The Legal Environment of Business and Online Commerce, 7e (Cheeseman)
Chapter 3 Courts, Jurisdiction, and Administrative Agencies
1) A decision of a limited-jurisdiction trial court can be appealed at a general jurisdiction court or
an appellate court.
2) In small claims courts, it is necessary that the parties are represented by a lawyer at all times.
3) General jurisdiction trial courts can be found in every state.
4) In general jurisdiction trial courts, the testimony and evidence at trial are recorded and stored
for future reference.
5) The decisions handed down by the general jurisdiction trial courts are appealable to an
intermediate appellate court or the state supreme court.
6) Intermediate appellate courts review new evidence or testimony that was not seen or heard in
the lower courts.
7) Appellate court decisions are final and cannot be appealed to any higher courts.
8) The intermediate appellate courts do not allow the parties to have oral hearings.
9) No new evidence or testimony is heard in the state supreme courts.
10) Decisions of highest state courts are final unless a question of law is involved that is
appealable to the U.S. Supreme Court.
11) Federal judges of the U.S. district courts are appointed for 14-year terms.
12) Pursuant to the power given to it by Article III of the U.S. Constitution, Congress has
established the U.S. courts of appeals.
13) In the United States, each state has only a single district court.
14) The federal district courts are empowered to impanel juries, receive evidence, hear
testimony, and decide cases.
15) The first 12 circuits of the U.S. court of appeals are geographical.
16) In U.S. courts of appeals, the parties file legal briefs with the court and are given a short oral
hearing.
17) In the U.S. Circuit Courts of Appeals, an en banc review refers to an appeal heard by a three-
judge panel.
18) Appeals from the Court of International Trade are heard by the Court of Appeals for the
Federal Circuit.
19) The highest court in the land is the Supreme Court of the United States, which is located in
Washington, DC.
20) The decisions of the U.S. Supreme Court can be appealed to higher courts.
21) A petitioner must file a petition for certiorari, asking the Supreme Court to hear the case.
22) A tie decision by the U.S. Supreme Court sets a precedent for later cases.
23) A justice who agrees with the outcome of a case but not the reason proffered by other
justices can issue a dissenting opinion that sets forth his or her reasons for deciding the case.
24) The Chief Justice of the Supreme Court is elected by the Associate Justices of the U.S.
Supreme Court.
25) The U.S. Supreme Court hears new evidence and testimony that was not permitted in the
U.S. district court.
26) The U.S. Congress gives the Supreme Court discretion to decide what cases it will hear.
27) ________ are courts that hear matters of a specialized or limited nature.
A) General-jurisdiction trial courts
B) Inferior trial courts
C) Intermediate appellate courts
D) Chancery courts
28) ________ are courts that hear cases of a general nature that are not within the jurisdiction of
limited-jurisdiction trial courts.
A) Courts of record
B) Intermediate appellate courts
C) Inferior trial courts
D) State supreme courts
29) ________ hears appeals from trial courts.
A) The highest state court
B) A court of record
C) An inferior trial court
D) An intermediate appellate court
30) Decisions of the ________ are final unless a question of law is involved that is appealable to
the U.S. Supreme Court.
A) courts of appeals
B) courts of records
C) highest state courts
D) general-jurisdiction trial courts
31) Which of the following is a function of the state supreme courts?
A) conducting trials related to misdemeanor criminal law
B) hearing appeals from intermediate appellate state courts and certain trial courts
C) conducting trials related to felonies and civil disputes
D) reviewing the judgments and records of the lower courts and ratifying them
32) Which of the following statements is true about intermediate appellate courts?
A) They hear new evidence and testimony that have come to light after the trial courts have
made their decision.
B) They do not grant any oral hearings to the parties.
C) They have jurisdiction to hear cases of a limited or specialized nature.
D) They review either pertinent parts or the whole trial court record from the lower court.
33) The ________ established by Congress have limited jurisdiction.
A) state supreme courts
B) state appeals courts
C) special federal courts
D) courts of records
34) Which of the following courts are the federal court system’s trial courts of general
jurisdiction?
A) U.S. district courts
B) U.S. Tax Courts
C) U.S. courts of appeals
D) U.S. courts of federal claims
35) The geographical area served by each U.S. court of appeals is referred to as a ________.
A) district
B) county
C) range
D) circuit
36) The ________ has special appellate jurisdiction to review the decisions of the Court of
Federal Claims, the Patent and Trademark Office, and the Court of International Trade.
A) U.S. District Court
B) Court of Appeals for the Federal Circuit
C) First Circuit Court
D) District of Columbia Circuit
37) The ________ hears cases brought against the United States.
A) U.S. Supreme Court
B) U.S. Tax Court
C) U.S. Court of Federal Claims
D) U.S. District Court
38) Which of the following courts are considered as the federal court system’s intermediate
appellate courts?
A) U.S. Courts of Appeals for Veterans Claims
B) U.S. courts of appeals
C) U.S. district courts
D) U.S. courts of federal claims
39) Why was the Court of Appeals for the Federal Circuit created?
A) It was created to exercise appellate jurisdiction over members of the armed services.
B) It was created to hear cases that involve federal tax laws.
C) It was created to provide uniformity in the application of federal law in certain areas,
particularly patent law.
D) It was created to hear appeals from intermediate appellate state courts and certain trial courts.
40) The U.S. Supreme Court is composed of ________ justices.
A) nine
B) six
C) ten
D) three
41) Which of the following courts was created by Article III of the U.S. Constitution?
A) U.S. Supreme Court
B) U.S. Tax Court
C) U.S. Court of Appeals
D) U.S. Court of Federal Claims
42) The U.S. Supreme Court is composed of ________ justices.
A) nine
B) six
C) ten
D) three
43) How are the justices of the U.S. Supreme Court appointed?
A) They are nominated by the President and confirmed by the Senate.
B) They are appointed by the President of the United States.
C) They are nominated and confirmed by the Chief Justice of the Supreme Court.
D) They are nominated by the Associate Justices and confirmed by the Chief Justice.
44) Which of the following statements is true of the U.S. Supreme Court?
A) The U.S. Supreme Court’s decisions are appealable.
B) The U.S. Supreme Court hears appeals only from the federal circuit courts of appeals.
C) The U.S. Supreme Court does not hear any new evidence or testimony in reviewed cases.
D) The U.S. Supreme Court does not grant any oral hearings to the parties.
45) ________ refers to an official notice that the Supreme Court will review a case.
A) Writ of certiorari
B) Stare decisis
C) En banc review
D) Sua sponte
46) In the U.S. Supreme Court, if all the justices voting agree as to the outcome and reasoning
used to decide a case, it is a ________ decision.
A) tie
B) plurality
C) majority
D) unanimous
47) In the U.S. Supreme Court, if a majority of the justices agree as to the outcome of a case but
not as to the reasoning for reaching the outcome, it is a ________ decision.
A) unanimous
B) majority
C) plurality
D) tie
48) Mary has already won her case at the U.S. Court of Appeals. When the case is reviewed by
the Supreme Court, only eight judges are present. Four of the judges vote for Mary while the
other four vote against her. Which if the following will be the result of this case?
A) The case will be sent to the U.S. Court of Appeals for a review.
B) Mary will win the case as she had already won at the U.S. Court of Appeals.
C) The case will be reviewed again by the U.S. Supreme Court when all the judges are present.
D) Mary will win and the case will set a precedent for later cases.
49) Which of the following is true about a plurality decision of the Supreme Court?
A) It settles the case but does not set the precedent for later cases.
B) It affirms the decision of the lower court.
C) It settles the case and sets the precedent for later cases.
D) It causes the case to be reviewed again at later date.
50) Which of the following is true about a majority decision reached by the U.S. Supreme Court?
A) All the judges agree as to the outcome and reasoning used to decide a case.
B) A majority of the judges agree as to the outcome but not the reasoning used to decide a case.
C) A majority of the justices agree as to the outcome and reasoning used to decide a case.
D) An equal number of judges vote for and against the petitioner and case remains undecided.
51) Which of the following similarities is observed between tie and plurality decisions reached
by the U.S. Supreme Court?
A) the decisions can be appealed against in the U.S. courts of appeals
B) the decisions do not set precedent for later cases
C) the decision of the lower court is affirmed
D) new evidence and testimony is heard before reaching decisions
52) Sue, a resident of the state of New York, is visiting her aunt in Iowa. While there, her car is
hit by a drunk driver named Jerry, a resident of the state of Iowa. Sue is injured in the accident.
Which of the following actions is Sue allowed to take?
A) Sue can sue Jerry and bring the case to Iowa state court provided that the dollar amount of the
controversy exceeds $75,000.
B) Sue can file a case against Jerry in the New York state court as she is a resident of that state.
C) Sue can file a case against Jerry only in the Iowa state court as this is a matter that involves
state negligence law.
D) Sue can sue Jerry and bring the case to Iowa federal court as this is a case that involves
diversity of citizenship.
53) ________ refers to cases arising under the U.S. Constitution, treaties, or federal statutes and
regulations.
A) Federal question cases
B) Diversity of citizenship cases
C) Federal crimes cases
D) Copyrights and trademarks cases
54) In which of the following cases do federal and state courts have concurrent jurisdiction?
A) bankruptcy cases
B) diversity of citizenship cases
C) antitrust cases
D) patents cases
55) In which of the following cases do federal courts have exclusive jurisdiction?
A) cases involving sales and lease contracts
B) federal question cases
C) suits against the United States
D) diversity of citizenship cases
56) Altonvista Inc., a company based in California, is sued by a plaintiff from the state of Texas.
Which of the following statements would apply to this situation?
A) The case must be heard in the California federal court as this is a subject matter in which
federal courts have exclusive jurisdiction.
B) If the plaintiff chooses to bring the case to the California federal court, it would stay in the
federal court.
C) If the plaintiff decides to bring the case to the California federal court, Altonvista Inc. can
have the case moved to a California state court.
D) The case can only be heard in a California state court as the matter is not subject to federal
jurisdiction.
57) Jeremy crashes his friend John’s car because he is an incompetent driver. Emily, John’s sister,
is outraged and wants John to sue his friend. John refuses to file a case against his long-time
friend. Which of the following is Emily allowed to do in this situation?
A) She can sue Jeremy on John’s behalf, as she has standing to sue.
B) She can sue Jeremy, provided that John gives his consent.
C) She can file a case in the state court where she will have standing to sue.
D) She cannot sue Jeremy as she has no stake in the outcome of the case.
58) ________ refers to a court’s jurisdiction over the parties to a lawsuit.
A) In rem jurisdiction
B) Quasi in rem jurisdiction
C) In personam jurisdiction
D) Sua sponte
59) ________ refers to jurisdiction to hear a case because of jurisdiction over the property of the
lawsuit.
A) In rem jurisdiction
B) Quasi in rem jurisdiction
C) Private jurisdiction
D) In personam jurisdiction
60) ________ refers to jurisdiction that allows a plaintiff who obtains a judgment in one state to
try to collect the judgment by attaching property of the defendant located in another state.
A) In rem jurisdiction
B) In personam jurisdiction
C) Private jurisdiction
D) Quasi in rem jurisdiction
61) Why do courts need to accomplish a service of process?
A) to obtain personal jurisdiction over the plaintiff in a lawsuit
B) to obtain personal jurisdiction over the defendant in a lawsuit
C) to obtain jurisdiction to hear a case where the court has jurisdiction over the property in the
lawsuit
D) to obtain jurisdiction over nonresidents who were not served summons within the state
62) Bill is trying to sell his house in Oklahoma City to George who lives in Arkansas. They have
a dispute over the terms of the contract and Bill decides to sue George. Which of the following
statements is true in this situation?
A) The Arkansas state court will hear this case as it has in personam jurisdiction over George.
B) The Arkansas state court has in rem jurisdiction to hear this case.
C) The Oklahoma state court has in rem jurisdiction to hear this case.
D) The Oklahoma state court does not have jurisdiction to hear this case as the defendant is from
another state.
63) Jill wins a lawsuit against Terry in the Wyoming state court. The court passes a judgment for
Terry to pay $20,000 to Jill. Immediately after the case is settled, Terry moves to Colorado,
where she owns a house, and refuses to pay Jill the money. Which of the following is the best
course of action for Jill?
A) file a lawsuit against Terry in a Colorado state court to enforce the Wyoming court judgment
B) file another case against Terry in the Wyoming state court to collect the money against Terry’s
property
C) file a case against Terry in Wyoming to force Terry to sell her house in Colorado to pay the
money
D) file a case in the Colorado federal court as this qualifies as a federal question case
64) ________ refers to a concept that requires lawsuits to be heard by the court with jurisdiction
that is nearest the location in which the incident occurred or where the parties reside.
A) Jurisdiction
B) Venue
C) Circuit
D) Doctrine of stare decisis
65) Donald, who is a resident of Louisiana, is robbed in Oklahoma County, Oklahoma. The
robber, who is a resident of the state of Texas, is soon apprehended. Which of the following is
the proper venue to hear this case?
A) state court in Louisiana because the plaintiff is from Louisiana
B) state court in Texas because the defendant is from Texas
C) Oklahoma federal court because the robber has committed a federal crime
D) Oklahoma County Court because it is nearest in location to the scene of the crime
66) ________ refers to a contract provision that designates a certain court to hear any dispute
concerning nonperformance of the contract.
A) No-contest clause
B) Choice of law clause
C) Forum-selection clause
D) Arbitration clause
67) ________ refers to a contract provision that designates a certain state’s law or country’s law
that will be applied in any dispute concerning nonperformance of the contract.
A) Choice of law clause
B) Forum-shopping
C) Arbitration clause
D) Forum selection clause
68) Which of the following powers of administrative agencies facilitates the investigation and
prosecution of possible violations of statutes and rules?
A) rulemaking power
B) executive power
C) judicial authority
D) licensing
69) ________ refers to a court that hears appeals from trial courts.
70) The geographical area served by each U.S. court of appeals is referred to as a ________.
71) ________ refers to a court’s jurisdiction over the parties to a lawsuit.
72) ________ refers to a concept that requires lawsuits to be heard by the court with jurisdiction
that is nearest the location in which the incident occurred or where the parties reside.
73) ________ are created by the government to enforce regulatory statutes.
74) ________ refers to the law that governments enact to regulate industries, businesses, and
professionals.
75) ________ refers to the federal statute enacted by Congress, or the state statute enacted by a
state legislature, that is enforced by the administrative agency.
76) Administrative law is a combination of substantive administrative law and ________.
77) The Department of Homeland Security, the federal Food and Drug Administration (FDA),
the National Labor Relations Board (NLRB), and the Equal Employment Opportunity
Commission (EEOC) are all examples of ________.
78) ________ are created by legislative branches of state to administer state regulatory laws.
79) ________ are created by cities, municipalities, and counties to administer local regulatory
law.
80) ________ refers to a rule issued by an administrative agency that has the force of law and to
which covered persons and businesses must adhere.
81) ________ refers to a federal statute that establishes procedures for federal administrative
agencies to follow while conducting their affairs.
82) An administrative law judge’s decision is issued in the form of a(n) ________.
83) Decisions of administrative law judges are subject to ________.
84) What is the jurisdiction of the U.S. Supreme Court?
85) Discuss the need and significance of the long-arm statute.
86) Compare and contrast between in rem and quasi in rem jurisdiction.
87) Describe the need for forum-selection and choice of law clauses.