Business Law and Ethics Final LEB 320F
Exam Questions with Complete
Solutions
Federal Laws - Answer-Laws that come from the government of the United States
State Laws - Answer-Laws created by individual states
Common Law - Answer-Legal ideas that originate in court opinions
Statutory Law - Answer-Legal rules created by bodies of elected representatives
Statute - Answer-When the Congress or a state legislature creates a new law
Civil lawsuit - Answer-People seeking compensation from others for wrongdoing against
them
Criminal Lawsuit - Answer-The government prosecuting someone for breaking the law
District Courts - Answer-First stop of every lawsuit, where lawyers file pleadings, select
juries, place witnesses on the stand for examination. Judges rule on motions and
objections, give juries instructions, and enter judgments. Juries listen to evidence,
deliberate, and return verdicts.
U.S. Courts of Appeal or circuit courts - Answer-If parties to a lawsuit are dissatisfied
with how a trial court handled a case, they can take an appeal here. Where a panel of
judges reviews the case for errors. Intermediate appellate courts
Supreme Court - Answer-If a party is unhappy with an intermediate court's actions, it
can ask a this court to give a final review to the case.
Jurisdiction - Answer-A court's power or authority over a case
Subject matter jurisdiction - Answer-A court's power to hear a particular type or category
of case. Some courts have been created to decide only one particular kind of case.
Federal courts only have subject matter jurisdiction over 2 major types of lawsuits -
Answer-Federal Question Cases and Diversity of Citizenship Cases
Federal Question Cases - Answer-Plaintiffs base their claims on federal laws or
statutes. (Ex: Plaintiffs believe they should win their case because of Civil Rights of
1964 or provision to the U.S Constitution)
,Diversity of Citizenship Cases - Answer-Plaintiff & defendants live in different states and
plaintiffs seeks at least $75,000
Federal courts - Answer-Courts of limited jurisdiction (limited to the types of cases the
Constitution says they can hear)
State courts - Answer-Courts of general jurisdiction that have much broader subject
matter jurisdiction and can even entertain federal question and diversity cases, with
some major exceptions.
Personal jurisdiction - Answer-A court's power or authority over the parties involved in a
lawsuit. Plaintiffs voluntarily submit themselves to a court's jurisdiction upon filing a
lawsuit, so the focus here is always on defendants.
Under what circumstances does a court come to have authority over a defendant? -
Answer-A court has personal jurisdiction over a defendant if he makes an appearance,
or takes a formal step to defend a lawsuit. A defendant may also be served with a
summons, or formal notice of a lawsuit.
Long arm statutes - Answer-This statue can establish personal jurisdiction if a
defendant has had minimum contacts, or some reasonable degree of interaction, with a
state
When can a lawsuit proceed without a court having personal jurisdiction over a
defendant? - Answer-When a court has in rem jurisdiction over property located in the
same state that a court sits, it can act as a substitute for personal jurisdiction if the
property is the focus of the claim
True
Any case that arises out of a federal statute, such as the Americans with disabilities act,
can be brought in a Federal District court. - Answer-T/F A claim arising out of the
Americans with disabilities act, which is a Federal statute, would be a Federal Question
case and, therefore, be within a federal district court's jurisdiction.
Courts of limited jurisdiction - Answer-Includes justice of the peace courts, municipal
courts, traffic courts, probate courts, and domestic relations courts.
False
An effective manager will attempt to alter political situations and regulations to aid their
company. - Answer-T/F An effective manager of a corporation should not attempt to
alter political situations.
True
Criminal cases require that the case be proved "beyond a reasonable doubt." Civil
cases vary, but generally require proof by a "preponderance of evidence." - Answer-T/F
,For a criminal trial, the government must prove their case "beyond a reasonable doubt"
in order to secure a guilty verdict
True
In Rem jurisdiction, which can be established by having property within the jurisdiction
of the court, can satisfy jurisdictional requirements for a case. - Answer-T/F Personal
jurisdiction over certain cases, such as bankruptcy cases, can be established simply by
having property relevant to the suit within the jurisdiction of the court.
True
If a defendant has continuous and systematic contacts with a jurisdiction, it has general
jurisdiction over the defendant. When a state has general jurisdiction over a party, it has
personal jurisdiction over the party. - Answer-T/F ACC, a Florida company, sells Zach, a
Louisiana citizen, a car in Minnesota. The car breaks down while Zach is driving in
Oklahoma. Florida has continuous and systematic contacts with Oklahoma because it
manufactures products in Oklahoma. Oklahoma has general jurisdiction over ACC and,
therefore, has personal jurisdiction over ACC.
False
The Supreme Court gets to choose which cases it hears. Generally, only cases granted
writ of certiorari are heard by the Supreme Court - Answer-T/F All cases before a
federal Circuit court have the right to be heard on appeal.
False
Simply having a website, "without requiring some level of 'interactivity' between the
defendant and consumers in the forum state" is not enough to establish general
jursidiction in a given jurisdiction. - Answer-T/F A website accessible in a jurisdiction is
enough to establish general jurisdiction.
True
Although there are many exceptions, a third party generally has no legal obligation to
assist a third party. - Answer-T/F Individuals are generally not required by law to help a
third party when they request aid.
False
Corporations are considered to be citizens of both the state in which they are
incorporated in and where their principle place of business is. Because USC's principle
place of business is in Texas and Johnny is a citizen of Texas, diversity jurisdiction
cannot be established. - Answer-T/F Johnny, a citizen of Texas, sues USC, a
corporation incorporated in California with a principle place of business in Texas, for
$2.5 million on a claim arising from state law. This suit can be brought in Federal Court.
False
Under Rules of Civil Procedure 4(k)(2), if a foreign defendant has a significant amount
of contact with the United states, but personal jurisdiction cannot be established with
any individual state, the foreign defendant can still be found to have personal
, jurisdiction. - Answer-T/F Magnus, a citizen of Sweden, has a significant number of
contacts with the United States as a whole to establish personal jurisdiction, but not
enough contacts with an individual state to establish jurisdiction. An American court
cannot establish personal jurisdiction over Magnus.
False
Most jurisdictions consider any defense claiming lack of personal jurisdiction to be
waived when a party makes an appearance before the court. - Answer-T/F A party may
make a special appearance at any point in a trial.
False
Some appeals from specialized federal courts go to federal district courts for their
appeals, while others go to Circuit Courts. - Answer-T/F Appeals from specialized
federal courts, such as bankruptcy courts always go to the Federal Court of Appeals.
Which of the following are factors in determining if a duty is owed to assist a third party?
- Answer-Foreseeability of harm to the plaintiff, extent of burden to the defendant,
consequences to the community of imposing a duty to exercise care with resulting
liability for breach, the degree of certainty that the plaintiff suffered injury, the closeness
of connection between the defendant's conduct and the injury suffered, the moral blame
attached to the defendant's conduct, and the availability, cost, and prevalence of
insurance for the risk involved.
Summary Judgement - Answer-A trial judge deciding a case as a matter of law because
there is "no genuine issue of material fact." A judge may decide the outcome of a case
without allowing the case to go before a jury.
The case is remanded to the lower court with instructions on what the lower court erred
on and how to properly try the case. - Answer-What happens when an appellate court
finds that a lower court judge erred in granting summary judgment?
California
If there is a provision that all litigation regarding the contract will be brought in a specific
state, it should be brought in that state as long as there is a passing connection to the
parties or to the transaction with the state. - Answer-A contract between a Texas
corporation and a California corporation, signed in New York contains a provision that
all litigation regarding the contract will be performed in California. What state's law
should be applied to the litigation?
Filing of the pleadings - Answer-The first significant pre-trial event
A complaint - Answer-Filed by a plaintiff and amounts to a list of allegations. Plaintiffs
submit a list of factual statements that, if proven with evidence, might show a defendant
guilty. Also tends to make a request for damages or some other remedy.
