Decision to Sue
1) The First thing: The first that that a party must do before bringing a case to trial is decide whether it is truly the best thing or not to bring the case.
I. Choose Not to Sue: If you are deciding whether or not to sue, look over these elements.
a. The overall cost of litigation
i. Is it worth the money with the chances
b. Is it worth stepping on toes of current relationships
c. Long delays for litigation and remedy potential
d. The chance that we will not win anyways
e. Embarrassing testimony and information that may be made public or even media attention.
II. Other Options: Consider other options for the resolution
a. Alternative Dispute Resolution
i. Mediation
ii. Arbitration
b. Settlement: If there is information that the parties may not want to get out to the public then settlement may be the best option.
Subject Matter Jurisdiction
1) Subject Matter Jurisdiction Generally: The competency of a court to hear and decide particular categories of cases, in the United States the constitution and statutory provisions define and limit the subject matter jurisdiction of the state and federal courts.
I. Waiver and Consent: A party cannot consent to have a court without SMJ to hear the case, likewise a party cannot waive an objection to SMJ.
a. Objection: In fact an objection to a courts SMJ can be raised anytime, even by the court (sua sponte).
b. A court without: SMJ cannot render judgment, if they do it is corum non judice, without a judge, or without proper SMJ.
II. Mandatory Nature: The courts that have SMJ are generally obligated to hear the disputes, however they may choose not to under compelling reasons. If a court does so the proper procedure of a party is appeal to a superior court within the respective system by:
a. A writ of mandamus: A writ sought from a superior court to compel the inferior court to exercise its authority.
b. A writ of prohibition: Directs the judge and parties of a suit in an inferior court to cease litigating matters outside the inferior courts jurisdiction.
State Subject Matter Jurisdiction: When a case is first to be brought in a state court
1) State Subject Matter Jurisdiction brief history: The State Court System is quite complex, and no two are exactly alike.
I. Colonial Period: This complexity stems from the colonial period where each individual colony, as sovereign entities had their own constitution.
II. Independence-Reconstruction-Industrialization: After independence the state courts expressed great interest in development of independent court structures, and little desire for a powerful federal government.
a. State Courts: The state courts often conflicted with state legislatures.
b. Reconstruction-Industrialization: From the reconstruction through industrialization the state courts faced great strain as a slew of new civil cases came into the state courts as the nation expanded and became more industrialized.
i. Response: Many states in response developed new courts either over different geographic regions, specializations, or general matters.
ii. Outcome: Courts however compounded atop of one another, and the system became greatly fragmented and complicated.
III. Court Unification Movement: Proposed by Roscoe Pound, pushed for one or two trial courts. While this has been adopted by some states others have generally developed a four tier system:
2) State Subject Matter Jurisdiction Generally:
I. State Courts System: Are designed and designated by state statute, state constitution, and state laws.
II. The state court has Exclusive Jurisdiction: Over Probates, wills, Domestic Family Issues, Workers Compensation from the Industrial Commission.
a. Rationale: Strong State Interest in these issues and good competency.
III. The state has Concurrent Jurisdiction: Over both diversity claims, and federal question claims that the federal court has not been given exclusive jurisdiction over. Other original jurisdiction of the state courts is conferred through amendment 10 of the US constitution allowing jurisdiction of the state courts anything that is not specifically given to the federal courts.
IV. Federal Courts Have Exclusive Jurisdiction: & Therefore the state court DOES NOT have concurrent jurisdiction over:
a. 28 USC §1333: Admiralty & Maritime
b. 28 USC §1334: Bankruptcy under chapter 11
c. 28 USC §1337: Anti-trust and Commerce
d. 28 USC §1338: Patents, Trademarks, Copyrights, Plant Variety Protection, Mask Works, and Unfair Competition.
e. 28 USC §1346: United States as a Defendant.
3) Integrated Court System: Proposed by Roscoe Pound, this is the essence of what was discussed, however not an exact replica.
I. Limited Jurisdiction: Generally smaller claims, smaller criminal infractions and are usually called by magistrate courts, municipal courts, city courts.
a. Appeal: Since these are unrecorded courts, appeals are usually conducted as trial de novo (a new trial in a court of general jurisdiction).
b. Exclusive: Can have exclusive jurisdiction over certain matters.
c. Concurrent: Or may share jurisdictional power with another court.
II. General Jurisdiction: In all state courts there are courts of general jurisdiction which have the jurisdiction to hear cases that are not exclusively delegated to another court in the system:
a. Power: Has the broadest power in the state court system.
b. Repository: Court that is used when none other has jurisdiction.
c. Locations: Generally designated within the current boundaries within the state.
i. Rural: Judges may ride circuit holding court in specific places throughout year.
ii. Urban: Judges usually hold court in specific locations.
iii. Specialized: Some judges only hear criminal or civil matters.
iv. Judges: All are required to have law degrees
d. Names Typically: District, Circuit, Superior.
III. Court of Appeals: The court of appeals is the appellate division above the general trial court. The organization differs from state to state greatly.
a. Size: States can have as small as just a few appellate judges to over 100.
b. Sitting: Some courts the judges sit En Banc (All judges sitting) others will sit in rotating panels.
IV. Court of Last Resort: All states have a court of last resort which hears the final appeals coming either from the court of appeals, or directly from the general jurisdiction trial court under certain circumstances.
a. Discretion: Generally the court of last resort can exercise discretion as to which matters they will adjudicate, and their decisions are binding on all courts within the state.
3) Example System to Use: North Carolina court system, called the general court of justice, is a unified and state operated system consisting of three levels: Appellate division (Supreme Court and Court of Appeals), Superior Court Division, and District Court Division.
I. Appellate Division: The appellate division consists of the Supreme Court and the Court of Appeals and both sit in Raleigh, however appeals court may sit in other localities.
a. Directly to Supreme Court: Generally capital murder cases involving death penalty and Utility Commission Rate Making cases go to the Supreme Court Directly. All other cases go the the court of appeals and to the SC through certification.
II. Superior Court Division: The superior court is the court of original jurisdiction and is divided into districts and then further into divisions for electoral and administrative purposes.
a. Importance: Judges will ride the circuit through the division which may allow (our) case to shop for a more favorable judge.
b. Jurisdiction: Usually concurrent with district court, (meaning can be filed in both), however generally cases involving $10,000 or more or involving (injunctions, constitutional issues, eminent domain, and corporate receiverships) will likely be filed in the superior court.
c. Exclusive: Jurisdiction over probates of wills, administration of decedents and incompetents estates, administration of trust.
III. District Court Division: Is divided into districts as well and is tried by either a judge or a magistrate.
a. Jurisdiction: Is shared with the Superior Court except for exclusive matters in that court.
b. Amount In Controversy: Of $10,000 or more in the superior court is proper for that court but not exclusive, for matters of convenience the parties may consent to either court.
c. Proper Court for: Domestic Relations Matters.
d. Civil Cases of $5,000: May be considered small claims and tried by a magistrate under certain conditions.
IV. North Carolina Industrial Commission: Will hear claims with a ceiling of $500,000 for damages awarded.
V. Jury Availability: A jury of twelve is available in both the district and superior court is asked for.
VI. Alternative Dispute Resolution: The North Carolina Court system has been working with different methods of efficiency and has begun to adopt the:
a. Arbitration: In many cases involving amounts under $15,000, however the parties have a right to have the case heard in a district or superior court if not satisfied.
Federal Subject Matter Jurisdiction: When a case is to be brought in a federal court
1) Origination of the Power of the Federal District Courts: During the Judiciary Act of 1789, Article I of the United States Constitution was adopted, providing that the judiciary power of the United States shall be vested in one Supreme Court and any other courts that congress should deem necessary.
I. Article III §2: Shortly after it is
Included: The factors that can be included in the $75,000
i. Attorney’s fees
ii. Injunctive Relief
iii. Damages
iv. Punitive Damages (If the state allows)
b. Not to be Included: When calculating the $75,000 requirement
i. Court Costs
ii. Interest
iii. Counterclaims
c. Who Bears the Burden: The party seeking diversity of citizenship bears the burden of proving the amount in controversy.
d. Good-Faith Estimate: Is what the party uses to claim that they has exceeded the amount in controversy requirement.
e. Legal Certainty: A court cannot dismiss an action or refuse to hear an action over the amount in controversy requirement unless the claim does not exceed the required amount or if they can say with a legal certainty that it will not be met.
f. Actual Recovery: if the plaintiff actually recovers less than the amount that was asserted then there is no action or ramifications, it is insignificant.
g. Three Tests: To determine the amount in controversy
i. Plaintiff View: From the plaintiffs view of the value
ii. Defendant View: From the defendants point of view
iii. Invocation Rule: From the party that is invoking federal jurisdiction.
VI. Aggregation of Claims: Only under certain circumstances can individuals aggregate claims in order to meet an amount in controversy requirement.
a. Single Plaintiff v. Single Defendant: Can aggregate related claims or separate and independent claims.
i. Cannot aggregate for same injury based upon different theories of recovery.
b. Single Plaintiff v. Multiple Defendants: Can aggregate claims that are Jointly and Severally Liable, otherwise no.
c. Multiple Plaintiff v. Single Defendant: Cannot Aggregate unless joint claims.
d. Supplemental Change: As long as one plaintiff meets the amount in controversy, other parties may add their claim as long as complete diversity is not destroyed.
e. Class Action Suits: Originally in Zahn v. International Paper the requirement that each member had to meet the requirement, however this has changed, and not class action claims can and usually must be aggregated.
VII. Devices to Create/Defeat Diversity Jurisdiction: Under certain situations a party may defeat or create diversity jurisdiction by tactically pleading or making their case.
a. 28 USC §1359: A district court shall not have jurisdiction over a party collusively joined in an action as to invoke the jurisdiction of the federal courts.
b. Assignment: A plaintiff may not assign him claim to another party as to invoke the rights and privileges of diversity jurisdiction.
c. Low Dollar Claim: A plaintiff may decide to claim a lower dollar amount as not to meet the amount in controversy requirement of the federal courts.
d. Failure to add Indispensible parties: A plaintiff who has collusively failed to join indispensible parties will not be able to bring his action in federal court.
VIII. A federal Courts Refusal To Hear: A federal court may refuse to hear a diversity action under certain situations.
a. Where Parties Collusively Joined: Where parties have been collusively joined to create diversity.
b. Over State Matters: Such as Probate Matters or Domestic Issues.
c. Under the Abstention Doctrine:
i. If State Matters Substantially Predominate
ii. If the federal dockets are too congested
