Traditional and Online Dispute Resolution

Traditional and Online Dispute Resolution true/false questions 1. Federal courts are superior to state courts. ANSWER: F 2. State courts are superior to federal courts. ANSWER: F 3. The courts act as a check on the other branches of government. ANSWER: T 4. Generally, a state court can exercise jurisdiction over anyone within the boundaries of the state. ANSWER: T 5. A long arm statute is a state law that permits courts to obtain jurisdiction over out-of-state defendants. ANSWER: T 6. Generally, a state court cannot exercise jurisdiction over a nonresident if he or she had minimum contacts with the state. ANSWER: F 7. A state court can not exercise jurisdiction over all of the property located within the boundaries of the state. ANSWER: F 8. Any lawsuit involving a federal question can originate in a federal court. ANSWER: T 9. For purposes of diversity of citizenship, a corporation is a citizen only of the state in which it does business. ANSWER: F 10. Cyberspace is its own jurisdiction. ANSWER: F 11. The Internet has no effect on a court’s assertion of personal jurisdiction. ANSWER: F 12. Doing substantial business in a jurisdiction exclusively over the Internet is not enough to support jurisdiction over an out-of-state defendant. ANSWER: F 13. To have standing to sue, a party must have been harmed or have been threatened with harm by the action about which he or she complains. ANSWER: T 14. A justiciable controversy is a case in which the court’s decision—the “justice” that will be served—will be controversial. ANSWER: F 15. The jurisdiction of state courts of appeals is substantially limited to hearing appeals. ANSWER: T 16. The federal equivalent of a state trial court is a U.S. court of appeals. ANSWER: F 17. The United States Supreme Court has appellate authority over all cases decided in the state courts. ANSWER: F 18. An answer can admit to the allegations made in a complaint. ANSWER: T 19. An answer can deny the allegations made in a complaint. ANSWER: T 20. A motion for summary judgment may be supported with sworn statements and other materials. ANSWER: T 21. Discovery is a process for gathering evidence and information in a suit. ANSWER: T 22. In a federal case at law involving more than $20 in damages, a defendant has the right to a jury trial. ANSWER: T 23. A motion for a new trial will be granted only if the trial judge feels that it is appropriate to grant a judgment for the other side. ANSWER: T 24. After a decision has been rendered in a case, neither party may file an appeal. ANSWER: F 25. Most lawsuits are settled or dismissed before they go to trial. ANSWER: T 26. No court requires mediation before a case goes to trial. ANSWER: F 27. Mediation is adversarial in nature. ANSWER: T 28. An arbitrator can never render a legally binding decision. ANSWER: F 29. A party to an arbitration agreement may be compelled to arbitrate a dispute, if the agreement covers the subject matter of the dispute. ANSWER: T 30. An arbitrator’s mistake in a finding of fact or a conclusion of law is the only basis for setting aside an award. ANSWER: F 31. Most states do not enforce arbitration clauses. ANSWER: F PAGE: 47 32. An arbitrator’s award is never the final word on a matter. ANSWER: F PAGE: 47 TYPE: = 33. A mini-trial is a private proceeding in which each party’s attorney argues the party’s case before the other party. ANSWER: T PAGE: 49 TYPE: = Thinking 34. Access to online dispute resolution services is possible 24/7. ANSWER: T PAGE: 49 TYPE: = Skill Level: AICPA Leveraging Technology 35. Unless otherwise agreed, the result of an online dispute resolution proceeding may not be appealed to a court. ANSWER: F PAGE: 49 TYPE: = MULTIPLE-CHOICE questions 1. The Ohio state legislature passes a law to regulate local delivery services. The final authority regarding the constitutionality of this law a. are the courts. b. is the president of the United States. c. is the governor of Ohio. d. is the U.S. Congress. ANSWER: A PAGE: 30 TYPE: + 2. Gail is a resident of New Hampshire. In Vermont, Gail enters into a contract with Heather, a resident of Vermont. When Gail breaches the contract, Heather files a suit against Gail in Vermont. Regarding Gail, Vermont can a. exercise diversity jurisdiction. b. exercise in personam jurisdiction. c. exercise in rem jurisdiction. d. not exercise jurisdiction. ANSWER: B PAGE: 31 TYPE: = 3. Leo, a resident of Missouri, owns a warehouse in Nebraska. A dispute arises over the ownership of the warehouse with Opal, a resident of Kansas. Opal files a suit against Leo in Nebraska. Regarding this suit, Nebraska has a. diversity jurisdiction. b. in personam jurisdiction. c. in rem jurisdiction. d. no jurisdiction. ANSWER: C PAGE: 32 TYPE: = 4. The case of Aaron v. Baker Co. is heard in a Minnesota district court, which has original jurisdiction. The case of NuCorp, Inc. v. Olson is heard in a Minnesota court of appeals, which has appellate jurisdiction. The difference between original and appellate jurisdiction lies in a. the subject matter of the cases that a court can decide. b. whether a case is brought by a citizen or by a business entity. c. whether a case is being heard for the first time. d. whether a court is exercising in personam or in rem jurisdiction. ANSWER: C PAGE: 33 5. Sam, a citizen of New Mexico, wants to file a suit against Tanya, a citizen of Texas. Their diversity of citizenship may be a basis for a. any court to exercise in rem jurisdiction. b. a federal district court to exercise original jurisdiction. c. a U.S. court of appeals to exercise appellate jurisdiction. d. the United States Supreme Court to issue a writ of certiorari. answer: B PAGE: 33 6. Don files a suit against Eagle Sales, Inc., in a Florida state court based on a Web site through which Florida residents can do business with Eagle. The court will likely exercise jurisdiction over Eagle if the interactivity of the site is seen as a. a “neutral” connection with the state. b. an “Internet” connection with the state. c. a “passive” connection with the state. d. a “substantial enough” connection with the state. ANSWER: D PAGE: 34 Thinking 7. Doug files a suit in Ohio against Beth over the ownership of a boat docked in Ohio. Doug and Beth are residents of New York. Beth could ask for a change of venue on the ground that New York a. has a sufficient stake in the matter. b. has jurisdiction. c. has sufficient minimum contacts with the parties. d. is a more convenient location to hold the trial. ANSWER: D PAGE: 34 TYPE: = 8. Consumer Goods Corporation sells products that are poorly made. Dina, who has never bought a Consumer Goods product, files a suit against the firm, alleging that its products are defective. The firm could ask for dismissal of the suit on the basis that Dina does not have a. jurisdiction. b. standing. c. sufficient minimum contacts. d. venue. ANSWER: B PAGE: 35 TYPE: = 9. Mary wins her suit against National Manufacturing Company. National’s best ground for appeal is the trial court’s interpretation of a. the conduct of the witnesses during the trial. b. the credibility of the evidence that Mary presented. c. the dealings between the parties before the suit. d. the law that applied to the issues in the case. ANSWER: D PAGE: 36 TYPE: = Thinking 10. Ben files a suit in a federal district court against Cathy. Cathy loses the suit, appeals to the U.S. Court of Appeals for the Second Circuit, and loses again. Cathy asks the United States Supreme Court to hear the case. The Court is a. not required to hear the case. b. required to hear the case because Cathy lost in a federal court. c. required to hear the case because Cathy lost in a lower court. d. required to hear the case because it is an appeal. ANSWER: A PAGE: 38 TYPE: = 11. Linda files a suit against Kate. Kate denies Linda’s charges and sets forth her own claim that Linda breached their contract and owes Kate money for the breach. This is a. an affirmative defense. b. a counterclaim. c. a crossclaim. d. an irrelevant response. ANSWER: B PAGE: 39 TYPE: = 12. Sam files a suit against Laura. The document that informs Laura that she is required to respond is a. the answer. b. the complaint. c. the service of process. d. the summons. answer: D PAGE: 39 Fact Pattern 2-1 (Questions 13–17 apply) Mack and Nancy engage in a business transaction from which a dispute arises. Mack initiates a lawsuit against Nancy by filing a complaint. 13. Refer to Fact Pattern 2-1. The sheriff serves Nancy with a summons. If Nancy chooses to ignore it a. Mack must file an amended complaint. b. Mack will have a judgment entered in his favor. c. Nancy must be served with a second summons. d. Nancy will have a judgment entered in her favor. ANSWER: B PAGE: 39 TYPE: + Thinking 14. Refer to Fact Pattern 2-1. If Nancy responds to Mack’s complaint by filing a counterclaim a. Mack will be given time to file a response. b. Mack will have a judgment entered in his favor. c. Nancy will be given time to file an amended answer. d. Nancy will have a judgment entered in her favor. ANSWER: A PAGE: 39 TYPE: + 15. Refer to Fact Pattern 2-1. If Nancy files a motion to dismiss, she is asserting that a. Mack did not state a claim for which relief can be granted. b. Mack’s statement of the facts is not true. c. Mack’s statement of the law is not true. d. Nancy suffered greater harm than Mack. ANSWER: A PAGE: 40 TYPE: + 16. Refer to Fact Pattern 2-1. If Nancy files a motion to dismiss, and the court denies it a. Mack will be given more time to file an amended complaint. b. Mack will have a judgment entered in his favor. c. Nancy will be given more time to file another response. d. Nancy will have a judgment entered in her favor. ANSWER: C PAGE: 40 TYPE: + 17. Refer to Fact Pattern 2-1. If Nancy files a motion to dismiss, and the court grants it a. Mack will be given more time to file an amended complaint. b. Mack will have a judgment entered in his favor. c. Nancy will be given more time to file another response. d. Nancy will have a judgment entered in her favor. ANSWER: A PAGE: 40 TYPE: + 18. Adam files a suit against Beta Products, Inc. Beta responds that even if Adam’s statement of the facts is true, according to the law Beta is not liable. This is a. a counterclaim. b. a motion for judgment on the pleadings. c. a motion for summary judgment. d. a motion to dismiss. ANSWER: D PAGE: 40 TYPE: = 19. Carol files a suit against Delta Corporation. Delta responds that it appears from the pleadings the parties do not dispute the facts and the only question is how the law applies to those facts. Delta supports this response with witnesses’ sworn statements. This is a. a counterclaim. b. a motion for judgment on the pleadings. c. a motion for summary judgment. d. a motion to dismiss. ANSWER: C PAGE: 40 TYPE: = 20. Home Appliances, Inc., files a suit against Retail Sales Corporation over a contract between them. Before the trial begins, Retail can obtain from Home a. access to related documents in Home’s possession. b. accurate information about Home’s trade secrets. c. an admission of the truth of matters not related to the trial. d. all of the above. ANSWER: A PAGE: 41 TYPE: + 21. Carl files a suit against Dina, over a contract between them. Before the trial begins, Carl can obtain from Dina a. access to related documents in Dina’s possession. b. accurate information about Dina’s privileged material. c. an admission of the truth of matters not related to the trial. d. all of the above. answer: A PAGE: 41 TYPE: + 22. Don files a suit against Eve. At the trial, each party’s attorney presents the party’s case before Fred, a judge, who hears the dispute and renders a legally binding decision. This is a. arbitration. b. litigation. c. mediation. d. negotiation. ANSWER: B PAGE: 42 TYPE: = 23. In Nation Corporation’s suit against Omega, Inc., the jury renders a verdict against Nation. Nation files a motion stating that even if the evidence is viewed in the light most favorable to Omega, a reasonable jury should not have found in its favor. This is a motion for a. a directed verdict. b. a judgment in accordance with the verdict. c. a judgment n.o.v. d. a new trial. ANSWER: C PAGE: 43 TYPE: = 24. In Greg’s suit against Holly, Greg seeks to recover the cost to provide copies of documents in hyperlinked CD format. According to the court in Case 2.2, Phansalkar v. Andersen, Weinroth & Co., this cost could be awarded if a. all of the parties used the electronic copies. b. Greg advanced the expense, hoping to recover it later. c. Holly consented to the expense in advance. d. the court encouraged the submission of electronic copies. ANSWER: C PAGE: 44 25. Sam files a suit against Tina. If this suit is like most cases, it will be a. dismissed before the parties enter a courtroom. b. settled before the parties enter a courtroom. c. dismissed or settled before the parties enter a courtroom. d. resolved only after a trial. ANSWER: C PAGE: 45 TYPE: = 26. Sally files a suit against Tom. Before going to trial, the parties meet, with their attorneys to represent them, to try to resolve their dispute. A third party assists them in reaching an agreement. This is a. arbitration. b. litigation. c. mediation. d. negotiation. ANSWER: C PAGE: 46 TYPE: = 27. Beta, Inc., and Beta’s employee Chuck have their dispute resolved in arbitration. The arbitrator makes an erroneous finding of fact. This is a ground for a court to a. review the merits of the dispute. b. review the sufficiency of the evidence. c. set aside the award. d. none of the above. ANSWER: D PAGE: 46 TYPE: + 28. Betty files a suit against Carl. Before going to trial, the parties meet, with their attorneys to represent them, to try to resolve their dispute without involving a third party. This is a. arbitration. b. litigation. c. mediation. d. negotiation. ANSWER: D PAGE: 46 TYPE: = 29. Mike files a suit against Kay. Before going to trial, the parties meet, with their attorneys to represent them, to formally present their dispute to a third party (other than a court) who renders a legally binding decision. This is a. arbitration. b. litigation. c. mediation. d. negotiation. ANSWER: A PAGE: 46 TYPE: = 30. Macro, Inc., and Micro Corporation ask Nora, an arbitrator, to resolve their dispute, which involves a matter of significant public concern. This is a ground for a court to a. review the merits of the dispute. b. review the sufficiency of the evidence. c. set aside the award. d. none of the above. ANSWER: D PAGE: 46 31. National Consumer Goods Corporation and Paula Purchaser agree to resolve their dispute in arbitration. The arbitrator’s decision is called a. a conclusion of law. b. a finding of fact. c. an award. d. a verdict. ANSWER: C PAGE: 46 32. Jan and Kyle sign a contract that provides if a dispute arises, they will submit to arbitration. A dispute arises, but before it goes to arbitration, Jan files a suit against Kyle. The court will likely a. hear the suit and then order the parties to arbitrate. b. hear the suit without ordering the parties to arbitrate. c. order relief without hearing the suit or compelling the parties to arbitrate. d. order the parties to arbitrate. ANSWER: D PAGE: 47 33. In Harry’s suit against Irma, the parties meet before going to trial, and each party’s attorney argues the party’s case before the other party. A third party renders an opinion as to how a court would likely decide the dispute. This is a. a mini-trial. b. arbitration. c. a summary jury trial. d. early neutral case evaluation. ANSWER: A PAGE: 48 TYPE: = Thinking 34. Lee files a suit against Grant. Lee and Grant meet, and each party’s attorney argues the party’s case before a jury. The jury presents a non-binding verdict, after which the parties try to reach an agreement. This is a. a mini-trial. b. arbitration. c. a summary jury trial. d. early neutral case evaluation. ANSWER: C PAGE: 48 TYPE: + 35. Dina submits her claim against Eagle Corporation to FairSettle.com, a private, online dispute resolution forum. At any time, an appeal of the dispute to a court may be made by a. Dina only. b. Eagle only. c. Dina or Eagle. d. neither Dina nor Eagle. ANSWER: C PAGE: 49 TYPE: = ESSAY questions 1. Eve is walking to work along a sidewalk next to a road. A National Distribution Company (NDC) truck strikes and injures Eve, causing her injuries that result in more than $100,000 in medical expenses. Eve is a resident of California, where the accident occurred. NDC has its principal place of business, and is incorporated, in New York. In what court may Eve sue NDC? ANSWER: Eve may sue NDC in New York, because NDC has its principal place of business, and is incorporated, in that state. NDC may be sued in California, because that is where Eve’s injury occurred. NDC may be subject to Eve’s suit in federal court, because the parties have diversity of citizenship (Eve is a resident of California and NDC has its principal place of business, and is incorporated, in New York) and the amount in controversy is more than $75,000 (the cost of Eve’s injuries is more than $100,000). PAGES: 31–33 TYPE: = Modeling 2. Best Engineering, Inc., performs computer programming services for American Products Corporation (APC). When APC’s computer system crashes, it loses $250,000 worth of business and pays $50,000 to have the system reprogrammed. APC announces to the media that the crash was due to Best Engineering’s incompetence and files a complaint in a federal court against the firm. In response, what are Best’s options? ANSWER: In response to a complaint, Best (the defendant) may file an answer in which the firm admits the statements or allegations set out in APC’s complaint or denies them and sets out any defenses that Best may have. (If Best admits to the allegations, a judgment will be entered in favor of APC. If Bests denies the allegations, the matter proceeds.) In the answer, Best may assert an affirmative defense—that is, admit the truth of the complaint but raise new facts to show that the firm should not be held liable for APC’s damages. (What sorts of facts these might be and what legal effect they might have are details explained in later chapters in this text.) Best could also deny APC’s allegations and assert a counterclaim that the crash occurred as a result of something APC did and APC owes Best money for damages to its reputation. APC would have to submit an answer to the counterclaim. Instead of filing an answer, Best might file a motion to dismiss. This motion might contend that APC failed to state a claim for which relief can be granted—in other words, even if the facts presented in the complaint are true, their legal consequences are such that there is no reason to go ahead with the suit. Other grounds for this motion include improper service of process and the court’s lack of jurisdiction or venue. (If the motion is denied, Best will be given time to file an answer. If the motion is granted, APC will be given time to file an amended complaint.)