Business Law Exam #1 Review

Comprehensive vocabulary flashcards covering the core legal concepts, doctrines, constitutional articles, court structures, and dispute resolution methods for Business Law Exam #1.

Functions of Law

The major purposes of law in society: to provide stability, predictability, and continuity; to identify legally right and wrong conduct; and to establish rights and obligations consistent with societal values.

Primary Source of Law

Binding legal authority that courts and parties must follow, including constitutions, statutes, administrative regulations, and case law.

Secondary Source of Law

A source that explains primary law but lacks binding legal authority, such as legal encyclopedias and restatements.

Supremacy Clause

A provision found in Article VI of the U.S. Constitution establishing that valid federal law controls whenever it conflicts with state law.

Article III of the U.S. Constitution

The constitutional article that establishes federal judicial power.

Rulemaking Power

An administrative agency's legal authority to create rules and regulations.

Investigatory Power

An administrative agency's authority to investigate conduct and verify compliance with its rules.

Adjudicatory Power

An administrative agency's authority to determine violations and impose sanctions or fines.

Securities and Exchange Commission

The administrative agency involved in the regulatory example concerning Elon Musk and Tesla.

Case Law

Judge-made law developed through judicial decisions, primarily functioning to interpret constitutions, statutes, regulations, and other primary sources.

Common-Law Tradition

The legal tradition that developed in England, historically associated with William the Conqueror and the creation of the King's Court.

Stare Decisis

A legal doctrine meaning 'to stand on decided cases,' requiring courts to decide similar cases similarly by adhering to precedent, which provides stability, predictability, and continuity.

Precedent

A court decision on a new legal issue that serves as an authority for future similar cases; lower courts are bound by it unless compelling reasons exist to overturn it.

Plessy v. Ferguson

The historic legal case associated with the establishment of the 'separate but equal' principle.

Brown v. Board of Education

The landmark Supreme Court decision that rejected the idea that 'separate but equal' is actually equal.

Substantive Law

Law that defines, describes, and regulates legal rights, duties, and claims.

Procedural Law

Law that establishes the methods, steps, and processes used to enforce legal rights, such as challenging personal jurisdiction.

Civil Law

The branch of law dealing with private disputes between individuals or businesses, typically seeking remedies such as monetary damages.

Criminal Law

The branch of law addressing wrongs committed against society as a whole, which can result in penalties involving loss of liberty or life.

Cyber Law

The emerging field of law dealing with wrongful or illegal conduct connected to technology and the internet.

Judicial Review

The authority of the judiciary to review legislative and executive acts and declare them unconstitutional, established by Marbury v. Madison based on Article III of the U.S. Constitution.

Marbury v. Madison

The foundational Supreme Court case that established the power of judicial review.

Basic Requirements to Bring a Case

The three procedural prerequisites that must be satisfied before a court can hear a lawsuit: jurisdiction, venue, and standing.

Personal Jurisdiction

A court's legal power over the parties to a lawsuit, established automatically by a defendant's residence in the forum state or via minimum contacts for nonresidents.

Minimum Contacts

The standard required to establish personal jurisdiction over a nonresident defendant in the forum state, illustrated by Southern Prestige v. Independence Plating.

Corporate Residence

The dual locations where a corporation is subject to personal jurisdiction as a resident: its state of incorporation and its principal place of business.

Internet Sliding-Scale Analysis

A legal standard used by courts to determine personal jurisdiction over an entity based on the degree of interactivity and commercial activity of its website.

Subject Matter Jurisdiction

A court's statutory or constitutional authority to hear and decide the specific type of controversy presented.

General Subject Matter Jurisdiction

A court's power to hear a wide, unrestricted range of legal disputes, except for those specifically assigned elsewhere.

Limited Subject Matter Jurisdiction

A court's power restricted to hearing only particular categories of cases or matters within strictly defined statutory limits.

Original Jurisdiction

The authority of a court to hear a case for the first time, take testimony, admit evidence, and create the initial trial record.

Appellate Jurisdiction

The authority of a reviewing court to examine decisions of a lower court, focusing primarily on assessing potential errors of law.

Federal Question Jurisdiction

Subject matter jurisdiction granted to federal courts for lawsuits that arise under the U.S. Constitution, federal statutes, or federal treaties.

Diversity of Citizenship Jurisdiction

Federal subject matter jurisdiction requiring that all opposing parties be citizens of different states and that the amount in controversy exceed $\$75{,}000$.

Exclusive Jurisdiction

A jurisdictional condition where only one designated court system has the sole authority to adjudicate a specific class of legal dispute.

Concurrent Jurisdiction

A situation where two or more court systems simultaneously possess subject matter jurisdiction over the same case.

United States District Court

The federal trial court of original subject matter jurisdiction, where evidence is presented, witnesses testify, and trials occur.

United States Circuit Courts of Appeals

The $13$ federal appellate courts responsible for reviewing decisions made by United States District Courts for errors of law.

United States Supreme Court

The highest court in the nation, located in Washington, D.C., with both original and appellate jurisdiction (primarily appellate), whose annual term runs from October through June 30.

Rule of Four

A procedural rule specifying that a minimum of four United States Supreme Court justices must vote affirmatively to grant a writ and hear a case.

Writ of Certiorari

A formal order issued by the United States Supreme Court commanding a lower court to forward the full record of a case for appellate review.

Arbitration

A method of Alternative Dispute Resolution where disputing parties submit their controversy to a neutral third-party arbitrator who renders a binding decision, as highlighted in Cleveland Construction Inc. v. Levco Construction Inc.

Mediation

A method of Alternative Dispute Resolution where a neutral mediator facilitates negotiations to assist parties in reaching a mutual agreement without imposing a decision.

Choice-of-Law and Choice-of-Forum Clauses

Contractual provisions strongly advised in international agreements to determine which jurisdiction's laws govern disputes and where litigation must occur.