ACC 150 THE LEGAL ENVIRONMENT OF BUSINESS With Doreen Smith, Esquire Chapter 2 * THE COURT SYSTEM AND DISPUTE RESOLUTION OVERVIEWThe Court SystemFederal and state courtsThe Court ProcedureThe procedural steps for a lawsuit when the case goes to trial.Alternative Dispute ResolutionWhen parties resolve a dispute using alternative methods of resolution (don’t go to trial). THE COURT SYSTEM What is a court? Tribunal established by law to: Hear and decide matters brought before it, Provide remedies (this would include monetary damages and equitable relief) when wrongs have been committed, and Prevent possible future wrongs. Courts award money damages and provide equitable relief. * THE COURT SYSTEMJurisdictionCourt’s power to hear a court case; the power to act over a particular defendant. Subject matter jurisdiction Jurisdiction over the subject matter of a case. For example, the Federal Bankruptcy Court cannot hear a divorce case.General jurisdictionCourt that can hear most controversiesLimited jurisdictionCourt that can hear only a particular type of case. Such as the Federal Bankruptcy Court can only hear bankruptcy cases. Chapter Two THE COURT SYSTEMPersonal jurisdiction (not covered in textbook but should be covered)This is the power of a court over a particular person (second part of jurisdiction definition).Example: You had a car accident with a Mr. Jones who lives in California. The car accident happened in Pennsylvania and you are a resident of Pennsylvania. You have never been to California. Mr. Jones sues you in California. The California court would lack personal jurisdiction over you. COURT SYSTEMThe courts in the United States are organized into the state and federal court systems, each (generally) with three levels: trial courts (has original jurisdiction).appellate courts.a supreme court.Supreme and appellate courts review the decisions of trial courts and either affirm, reverse or remand the lower court’s decision.Appellate jurisdiction reviews the work of a lower court. No trials occur in an appellate court. This court determines whether the judgment of a lower court was correct. Chapter Two * THE FEDERAL COURTS Chapter Two United States Supreme Court United States Court Of Appeals United States District Court The U.S. District Court is the trial court in Pennsylvania we have 3 Courts.—the local one is the U.S. District Ct. for the Eastern District of PA The U.S. Ct. of Appeals is the first appellate court. Pennsylvania is in the 3rd Circuit. The U.S. Supreme Court is the final appellate court. PENNSYLVANIA COURTS Chapter Two *The Commonwealth Court only hears appeals relating to local or state government. The Superior Court hears all other appeals. **De Novo –means over again. In this situation, you can appeal a district justice case and have the entire case tried over again. Supreme Court of Pennsylvania Commonwealth Court* Superior Court Court of Common Pleas– Tria.

1. ACC 150
THE LEGAL ENVIRONMENT OF BUSINESS
With Doreen Smith, Esquire
Chapter 2
*
THE COURT SYSTEM AND DISPUTE RESOLUTION
OVERVIEWThe Court SystemFederal and state courtsThe Court
ProcedureThe procedural steps for a lawsuit when the case goes
to trial.Alternative Dispute ResolutionWhen parties resolve a
dispute using alternative methods of resolution (don’t go to
trial).
THE COURT SYSTEM
What is a court? Tribunal established by law to:
Hear and decide matters brought before it,
Provide remedies (this would include monetary damages and
equitable relief) when wrongs have been committed, and
Prevent possible future wrongs.
Courts award money damages and provide equitable relief.
*

2. THE COURT SYSTEMJurisdictionCourt’s power to hear a court
case; the power to act over a particular defendant. Subject
matter jurisdiction Jurisdiction over the subject matter of a
case. For example, the Federal Bankruptcy Court cannot hear a
divorce case.General jurisdictionCourt that can hear most
controversiesLimited jurisdictionCourt that can hear only a
particular type of case. Such as the Federal Bankruptcy Court
can only hear bankruptcy cases.
Chapter Two
THE COURT SYSTEMPersonal jurisdiction (not covered in
textbook but should be covered)This is the power of a court
over a particular person (second part of jurisdiction
definition).Example: You had a car accident with a Mr. Jones
who lives in California. The car accident happened in
Pennsylvania and you are a resident of Pennsylvania. You have
never been to California. Mr. Jones sues you in California. The
California court would lack personal jurisdiction over you.
COURT SYSTEMThe courts in the United States are organized
into the state and federal court systems, each (generally) with
three levels: trial courts (has original jurisdiction).appellate
courts.a supreme court.Supreme and appellate courts review the
decisions of trial courts and either affirm, reverse or remand the
lower court’s decision.Appellate jurisdiction reviews the work
of a lower court. No trials occur in an appellate court. This
court determines whether the judgment of a lower court was
correct.

3. Chapter Two
*
THE FEDERAL COURTS
Chapter Two
United States
Supreme Court
United States Court
Of Appeals
United States
District Court
The U.S. District Court is the trial court in Pennsylvania we
have 3 Courts.—the local one is the U.S. District Ct. for the
Eastern District of PA
The U.S. Ct. of Appeals is the first appellate court.
Pennsylvania is in the 3rd Circuit.
The U.S. Supreme Court is the final appellate court.
PENNSYLVANIA COURTS
Chapter Two
*The Commonwealth Court only hears appeals relating to local
or
state government. The Superior Court hears all other appeals.
**De Novo –means over again. In this situation, you can appeal

4. a district justice case and have the entire case tried over again.
Supreme Court of Pennsylvania
Commonwealth Court*
Superior Court
Court of Common Pleas–
Trial court
Court of Common Pleas-
Trial court
District Justice (Small Claims)
Trial court with de novo** appeal
District Justice (Small Claims)
Trial court with de novo appeal
TRIAL COURTEvidence is presented at the trial level.The
testimony, documents or other tangible evidence all gets
presented here.Trier of Fact- Usually is a juryLaw—This is the
province of the judge. The judge presents the jury with the law
in the charge (jury instructions).
APPELLATE COURTIntermediate Court of AppealThese Courts
hear appeals from the trial courtNo evidence is given here.Panel
of 3 Judges hear casesEn Banc—entire court hears case—Only
done for important cases.Supreme CourtDiscretionary
jurisdiction—does not have to hear every casePetition for Writ
of CertiorariCourt can refuse to hear cases

5. THE COURT SYSTEM
What cases go to federal court?Federal District Courts: general
trial courts of original jurisdiction in both civil and criminal
matters. Jurisdiction limited to:
Civil suits against United States of America.
Diversity: $75,000 and citizenship from different states.
Cases arising under US Constitution or federal law.
Criminal cases in which a defendant is charged under a federal
statute.
*
THE COURT SYSTEM
State Court Systems.General Trial Courts. Courts of general
and original jurisdiction hear both civil and criminal
cases.Specialty Courts. Limited jurisdiction for family law,
probate, or juvenile cases.City, Municipal, and Justice Courts.
Handle civil matters below a certain jurisdictional amount in
dispute and misdemeanor cases. In Pennsylvania, these are
called District Justice (DJ’s), Municipal Court or Small Claims
Court.
*
COURT PROCEDURE Participants in the Court System.
Plaintiff: initiates civil proceedings. Prosecutor initiates
criminal proceedings.
Defendant: party against whom civil or criminal case is brought.
Judge: primary officer of the court, manages the case.
Jury: trier of fact, group of citizens and “peers.”
*

6. *
COURT PROCEDURE Which Law Applies—Conflict of
Laws.Law of state where complaint is filed governs procedural
issues and rules of evidence.For contract formation, courts
apply law of state in which contract was formed.For contract
performance, courts apply law of state in which contract is to be
performed.International: most significant contacts with
transaction.Parties often put choice of law provisions in
contracts which then clarifies any choice of law issue if a
dispute arises under a contract.
*
COURT PROCEDURE Initial Steps in Lawsuit.Commencement
of Lawsuit. Begins with filing a complaint, allegations and
request for relief.Service of Process. Complaint served on
defendant to give proper notice.Defendant’s Response and
Pleadings. Defendant can answer and deny the allegations in
the complaint, file a motion to dismiss (demurrer), or file
counterclaim.
These initial documents are called pleadings.
*
COURT PROCEDURE
Initial Steps in Lawsuit.Discovery. Requires each side to
disclose, upon request, information relevant to the case.
Deposition: testimony of witness under oath, can be used to

7. impeach and preserve.Interrogatories: written questions
answered under oathRequests for Production of Documents:
requesting written papers, photographs or other relevant
physical evidence from the other party in a lawsuit.
*
COURT PROCEDURE Initial Steps in Lawsuit.Motion for
Summary Judgment. When case has no ‘material facts’ in
dispute, judge may award verdict to movant party. This would
happen prior to a trial.Designation of Expert Witness. Some
special expertise that will help the trier of fact (usually a jury)
explain a standard of care or give value to a legal injury.
*
COURT PROCEDURE The Trial.Selecting a Jury. Process of
voir dire, the parties may challenge the selection of certain
potential jurors. Opening Statements.Presentation of Evidence.
Judge determines admissibility. Direct-exam of own witnesses,
cross-exam of opposing witnesses.Motion for Directed Verdict.
Asks the court to rule in movant’s favor because there is no
basis for recovery. This motion happens during a trial.
*
COURT PROCEDURE The Trial.Summation. Also called
closing arguments.Motion for Mistrial. To avoid great
injustice, usually based on misconduct or when jurors cannot
reach a verdict.Jury Instructions (judge provides law to jury)
and Verdict.Motion for New Trial; Motion for JNOV. Court
may grant JNOV if verdict is clearly wrong as a matter of law.
*

8. COURT PROCEDURE Posttrial Procedures.Recovery of Costs
Generally prevailing party is awarded (this does not include
attorney’s fees)Attorney fees are recoverable by prevailing
party if a statute allows for that or if a contract provision
includes an award of attorneys fees.Execution of Judgment.
Accomplished by seizure and sale of losing party’s assets by
sheriff. Garnishment is also a common method for collecting
judgment.
*
ALTERNATIVE DISPUTE RESOLUTION
Chapter Two
What is Alternative Dispute Resolution (ADR)?Methods of
resolving disputes without having a full jury trial
(litigation).The majority of cases filed in court do not proceed
to trial (they are settled or resolved by some other form of
alternative dispute resolution).
ALTERNATIVE DISPUTE RESOLUTION
Arbitration Disputes are resolved by arbitrators who hear
evidence and make a binding or non-binding decision.Parties to
contracts sometimes negotiate provisions that require disputes
to go to binding arbitration (no appeal of judgment).Some
statutes require cases to used mandatory arbitration (however
then a party can appeal the decision and get a full jury trial).
ALTERNATIVE DISPUTE RESOLUTION

9. Chapter Two
Mediation Disputes are resolved by the parties who use a third
person to facilitate their settlement.Mediator acts like a
messenger carrying possible offers between parties. Mediators
have no power to make a decision.
Summary Jury TrialA mock or dry-run trial so parties can see
how the case will play to a jury.
Mini-trialA trial held on portions of the case or certain issues in
the case (such as damages).
ALTERNATIVE DISPUTE RESOLUTIONContractsContract
sometimes contain clauses requiring the parties to use ADR to
settle the matters.The contract can make the ADR binding or
nonbinding.Court Ordered ADRSome courts require ADR for
certain kinds of cases.If ADR is mandatory, then the losing
party may appeal from ADR.
ACC 150
THE LEGAL ENVIRONMENT OF BUSINESS
With Doreen Smith, Esquire
Chapter 1
LAWDefinition of “law”?The order or pattern of rules that
society establishes to govern the conduct of individuals and the
relationships among them.Functions of the law:Keeps the
peaceMaintains orderFacilitating planningProviding a basis for
compromise

10. Chapter One
NATURE OF LAW AND LEGAL RIGHTS
Legal Rights: legal capacity to require another person to do or
not do an act.
Our rights flow from the U.S. Constitution, state constitutions,
federal and state statutes, local laws.
*
*
NATURE OF LAW AND LEGAL RIGHTS
Individual Rights:
Include freedom of speech, due process, right to vote.
Right of Privacy.Right to be secure against unreasonable
searches and seizures.Includes right to protection against
intrusion by others.
*
NATURE OF LAW AND LEGAL RIGHTS
Privacy and Technology.Technology has changed the way we
interact with each other and allows easier intrusion into
another’s privacy.Courts and Congress have said that right to
privacy also exists in electronic form and the internet.
*

11. SOURCES OF LAWConstitutional LawCase Law or Common
LawStatutory LawAdministrative Law
CONSTITUTIONAL LAWBody of principles that establishes
the structure of government and the relationship of that
government to the people who are governed.Certain checks and
balances are built into the Constitution to ensure that no one
branch of federal government becomes too strong.Commerce
Clause A clause in the Constitution that allows Congress to
regulate commerce between foreign nations or among several
states.
Chapter One
*
STATUTORY LAWSPassed by Federal or State
LegislaturesMust comply with US and State Constitution or the
law will be struck downExample Title VII of the Civil Rights
Act of 1964 was passed by Congress governs employers across
the countryLocal governments also pass laws which govern
conduct within a particular municipality (often called
ordinances).
ADMINISTRATIVE LAWAdministrative LawRules and
regulations created by an agency to carry out the mandates of a
statute. Example:Environmental Protection Agency (EPA)Has
been charged with the task of creating rules and regulations to

12. advance federal environmental protection laws.
PRIVATE LAWThe rules and regulations parties agree to as
part of their contractual relationship.Example:A lease between a
tenant and landlord will set forth all the various rules that must
be followed by each party based on the agreement. For
example, the lease may set forth which party will clear the
sidewalk of ice and snow should there be inclement weather.
CASE LAW OR COMMON LAWDefinition Laws made by
Judges in Court decisionsPrecedentA past judicial decision that
stands as the law for a particular problem in the future.Stare
DecisisThis means “let the decision stand.” The principle that
the decision of a court should serve as a guide or precedent and
control the decision of a similar case in the future.
EXECUTIVE ORDERS (E.O.)These are typically ordered by the
President.Example: E.O. 11246 requires federal contractors
who have contracts over a certain monetary value with the
federal government to create an affirmative action
plan.Executive Orders have the power of laws but do not require
Congressional action.Some recent Executive Orders are
considered controversial and beyond the power of the President.
SOURCES OF LAW
Chapter One
Common Law – made up of tradition and court precedent; may
be repealed or strengthened by case law and statutory law.

13. Case Law– laws made by decisions of a court; also courts may
enforce common law rules
Constitutional Law
Administrative Law
Statutory Law
Federal (U.S) Constitution
State Constitution
Federal (U.S. Congress)
State Legislatures
Local Government (City, County)
Federal Administrative Agencies
State Administrative Agencies
*
1
Chapter 1
UNIFORM STATE LAWS National Conference of
Commissioners on Uniform State Laws has drafted model
statutes. Best example is the Uniform Commercial Code which
regulates sale of goods, leases, banking, and letters of credit.
Other examples include: Model Business Corporations Act and
Uniform Partnership Act.

14. Uniform laws are considered sample laws that states can adopt.
These laws do not have any power until adopted by each
individual state.
*
CLASSIFICATION OF LAW
Substantive law
Creates, defines and regulates rights and liabilities.
Example-
Laws that apply to contracts are substantive law.
Procedural law
Specific steps that must be followed in enforcing rights and
liabilities.
Example-
The time frame given to a defendant to respond to a civil
complaint (more of this in Chapter 2).
Chapter One
*
CRIMINAL AND CIVIL LAWCriminal lawThe laws that define
wrongs against society. These actions are brought by the
government.Example: You see your former spouse walking
behind your car. You intentionally run them over! This would
be a criminal situation. Although a civil case can also be
brought by the injured spouse for damages.Civil lawThe laws
that define the right of one person against another.Example:
You are in the college parking lot backing up. You don’t notice
a fellow student walking behind you. You mistakenly hit them

15. with your vehicle. This would be a civil case because there was
no intent.
EQUITY Definition of Equity:The body of principles that
originally developed because of the inadequacy of the rule then
applied by the common law courts of England.Examples of
equitable relief (also referred to as remedies or
damages)InjunctionsStopping someone from doing
something….Such as stopping a union from picketing.Specific
performanceForcing a party to do something… Such as forcing
a seller (who has breached a sales agreement) to sell their
house.
Chapter One
*