Where Do Court Cases Come From?

(Abridged from “Law 101. Everything You Need to Know

About the American Legal System” by Jay M. Feinman)

Article III of the United States Constitution created an independent judiciary, one of the three separate and distinct branches of the federal government. The other two are the legislative and executive branches. The judicial system in the United States is actually made up of two different court systems: the federal court system and the state court system. Each of these two systems has its own respective jurisdictions. Where the Constitution gives Congress sole authority to make certain laws, a state court would lack jurisdiction in those matters. Likewise, where the Constitution does not give the federal government authority in a particular matter, a federal court would lack jurisdiction.

Let’s take a case and follow it through the litigation process. Litigation is so diverse that no case is typical, but the facts of this one are pretty ordinary.

Harry and Kay Robinson and their two children, Eva and George, were moving from New York to a new home in Arizona in 1977. As they were driving their year-old Audi 100 LS along Interstate 44 in Oklahoma en route to Arizona, their car was struck from behind by a Ford Torino driven by a drunk driver going around 90-100 m.p.h. The impact of the collision crushed the rear end of the Audi, jammed the doors shut, and punctured the car’s gas tank. The Robinsons’ car burst into flames, and Kay Robinson and the two children were severely burned.

It may be a little surprising that the Robinsons did not sue the drunk driver who struck their car. Instead, they sued Audi AG, the German company that manufactured the car; Volkswagen of America, Inc., the U.S. company that imported Audis; Seaway Volkswagen, Inc., the dealer in New York from whom they bought the car; and World-Wide Volkswagen Corp., the regional distributor that had sold the car to Seaway. This turn of events helps us think about how disputes make their way into the court system.

The first steps in initiating litigation are to recognize that there is a problem and that the problem is potentially subject to legal resolution. In the case of the Robinsons’ potential suit against the drunk driver, it’s easy to take those steps. The Robinsons suffered a severe injury. They knew, as we all do, that there is a legal remedy for injuring someone else by driving carelessly.

The Robinsons’ suit against the Audi defendants is less obvious. It requires a little more knowledge of the law and the situation to recognize that they might have a suit against the manufacturer and sellers of the car for a product defect that exacerbated their injuries.

A victim’s recognition that a potential legal dispute exists is only the first step. It must be worthwhile to incur the costs of the legal process rather than using alternative means of dispute resolution or forgetting the whole thing. In the Robinsons’ case, the obvious suit against the drunk driver probably was unattractive because the driver had little or no insurance or assets to pay a judgment. People seldom litigate just to establish a principle; unless there is a potential recovery, they will not spend the time and they will be unable to find a lawyer to invest in the litigation. Even if there is a potential recovery, alternative means of dealing with the problem may be better.

An important element of the decision to pursue litigation is the victim’s ability to obtain a lawyer to pursue the matter. The Robinsons found a lawyer willing to take their case, and the lawyer assessed the potential legal theories and identified defendants who might be held liable and who would be able to pay if they were. Probably the lawyer found that the driver who hit them had no insurance or assets or too little to pay for their injuries, and he contacted Audi, who refused to settle the case for an adequate amount, so it was time to sue.

Jurisdiction

Two kinds of considerations are involved when a lawyer decides where to bring a suit. The first is a legal issue: Which courts have the authority to hear the case? The second is a tactical issue: In which court is it most advantageous to litigate?

The law of civil procedure frames the first issue as involving jurisdiction. Jurisdiction, translated from the Latin, means “to speak the law.” Anyone can speak the law, but only a court with jurisdiction can speak the law authoritatively. If the court does not have jurisdiction, or legal authority over the parties and the case, it cannot lawfully hear the case, and any decision it reaches is not valid or binding on the parties. To lawfully adjudicate a case, a court must have both subject matter jurisdiction and personal jurisdiction. Subject matter jurisdiction empowers a court to hear the kind of case at issue, and personal jurisdiction permits the court to exercise authority over the parties to the dispute. For a court to hear the Robinsons’ case, therefore, it must have power over tort claims arising out of automobile accidents (subject matter jurisdiction) and power to compel the defendants to litigate before the court, and, if the Robinsons win, to pay a judgment (personal jurisdiction).

Three states have a logical relationship to the accident and the parties that makes them obvious places to bring a suit. The accident occurred in Oklahoma. The Robinsons had purchased their Audi in New York from Seaway Volkswagen, one of the defendants, and they were still legal residents of New York at the time of the accident. And they were on their way to establish a new legal residence in Arizona. Therefore, they might logically have brought suit in the courts of Oklahoma, New York or Arizona. We will strict our analysis to American courts; it is possible but unlikely that they would have sued in Germany, the home of Audi.

State Judicial System

Every state has a set of courts called courts of general jurisdiction that are empowered to hear most kinds of civil cases, including tort, contract, and property claims. These are the basic-level trial courts that hear the bulk of the state’s judicial business. Usually the subject matter jurisdiction of courts of general jurisdiction is unrestricted; the state constitutional provision or statute that gives them authority will be expressed in broad language, giving them “original jurisdiction in all civil, probate, and criminal cases, except as otherwise provided herein,” as the Colorado constitution provides. By tradition, the general jurisdiction courts of different states have different names. In Arizona, the Superior court is the Court of general jurisdiction; in Oklahoma, it’s the District Court; and strangely enough, in New York the general jurisdiction court is known as the Supreme Court. In New York, the highest court in the state, which is known everywhere as the state’s supreme court, is called the Court of Appeals. Every state also has courts of limited jurisdiction, such as a family court, whose subject matter jurisdiction is limited to divorce and child custody issues, a probate court, with jurisdiction limited to inheritance matters, and a small claims court, which only has jurisdiction over cases involving relatively small dollar amounts.

The Robinsons also have to sue in a court that has personal jurisdiction over the potential defendants. In most cases personal jurisdiction is easy. Suppose first that they want to sue the driver of the Ford that hit their car. They certainly can do so in Oklahoma, the state in which the accident occurred. If the Ford driver lives in Texas, the Robinsons can sue him there. But the personal jurisdiction issue is trickier when the defendants have a less obvious relationship to the state in which suit is brought and when they are corporations, not people, for whom it is harder to pin down where they are and where they act. Which courts, then, have personal jurisdiction over Audi, Volkswagen, World-Wide and Seaway?

The due process clause of the Constitution limits the ability of a state to exercise personal jurisdiction by requiring that the defendant have “minimum contacts” with the forum state, so that requiring him to defend there does not offend “traditional notions of fair play and substantial justice.”

The Robinsons attempted to sue the four Volkswagen defendants in Oklahoma, but the Supreme Court said that an Oklahoma court could properly assert jurisdiction only over the manufacturer, Audi, and not the distributor or dealer, World-Wide and Seaway. Audi sells its cars in a national market, so it has contacts with every state and should reasonably expect to be subject to a suit when one of its cars malfunctions in any state. It obtains the benefits of doing business everywhere, so it must accept the responsibility of being sued anywhere. World-wide and Seaway, however, only sells cars in the New York area. Although they could foresee that some of their customers would drive to Oklahoma, it would be constitutionally unfair to require them to go there to defend suits in the absence of any other contacts between them and that state.

Federal Judicial System

The Robinsons brought their case in the District Court in Creek County, Oklahoma, part of the Oklahoma state court system, but they could have “made a federal case out of it” by brining suit in the federal courts. The United States has a court system parallel to the state court systems. Like most state systems, the federal judicial system has trial courts (called the U.S. District Courts), intermediate appellate courts (called the U.S. Courts of Appeals, or sometimes the Circuits Courts, from the days when Supreme Court justices “rode circuit” to hold court in different places), and a highest court (the U.S. Supreme Court). This system is geographically organized.

Although the federal court system looks pretty much like the state systems, on the issue of jurisdiction the systems are fundamentally different. In the state courts, jurisdiction over the kind of case (subject matter jurisdiction) is usually easy, because the trial courts have general jurisdiction over most kinds of cases, but jurisdiction over the defendant (personal jurisdiction) is subject to the constitutional limitation of sufficient contacts with the state such that it is fair to assert authority over the defendant. In the federal courts it is just the opposite. Personal jurisdiction is unrestrained by constitutional due process requirements; even though the district courts sit locally, they are all part of a national system that can assert jurisdiction over defendants. Subject matter jurisdiction is much trickier, though, because the federal courts are courts of limited jurisdiction. . They only have authority to the extent that the Constitution and the Congress have granted it to them.

The framers of the Constitution and the Congress that enacted enabling legislation had two reasons for establishing federal courts. First, some cases involve important national issues that should be decided by judges of the United States government rather than of any particular state. Second, Americans always have been a bit parochial, so the framers wanted to provide a neutral forum for, say, New Yorkers who had to litigate in Oklahoma. Each of those reasons resulted in a particular kind of authority for the federal courts, known respectively as federal question jurisdiction and diversity jurisdiction. In addition, there are a few other classes of cases given to the federal courts, such as admiralty cases, which involve maritime affairs, and suits in which the United States government is a party.

One consequence of having different state court systems and a parallel federal system is that different bodies of law potentially apply to a single case. The Robinsons brought their case in Oklahoma state court. If they had gone to federal court instead, would the federal court have applied different law to determine if the Audi’s gas tank was defective? Or if they had sued in New York, would New York’s tort law have applied to the case instead of Oklahoma’s law? Because the law varies from place to place, issues like these often determine the outcome of the case, so it is essential that civil procedure has ways to resolve them.

Two kinds of conflict between the laws in different jurisdictions are easily resolved. Generally, a court applies its own rules of procedure, whatever substantive law applies to the case. Also, when a state court has a case involving federal law, it applies the federal law, including federal court decisions interpreting the law, because the Constitution makes federal law “the supreme law of the land”.

Two other kinds of conflict are much more complicated. The first involves a federal court hearing a diversity case. Today a federal court in a diversity case applies the same principles of tort law, contract law, and so on, as would be applied if the case were in state court. The second kind of complex interjurisdictional conflict is between two bodies of state law. Suppose Oklahoma holds manufacturers strictly liable for defects in their products but New York holds them liable only when they have been negligent in making their products. Can the Robinsons avoid the New York rule by suing in Oklahoma? This issue falls within the area of law known as conflict of laws, and requires a choice between the law of competing jurisdictions.

Exercise 3. Answer the questions.

1. What are the peculiarities of the judicial system in the United States?

2. When do state and federal courts lack jurisdiction to deal with certain matters?

3. What are the facts of the Robinsons’ case? In your opinion, why does the author use this case as an example?

4. Why did the Robinsons reject the idea of suing the drunk driver who hit their car?

5. What considerations are taken into account when deciding whether to pursue litigation?

6. What questions does the lawyer have to answer before deciding where to bring a suit? Why are the answers to those questions of essential importance?

7. What two types of jurisdiction must the court have to adjudicate a case? Why?

8. What courts does the state system of courts consist of? What cases are they empowered to deal with?

9. What does the due process clause mean?

10. What did the Supreme Court hold concerning jurisdiction of an Oklahoma court over defendants in the Robinsons case?

11. What courts does the federal judicial system consist of?

12. Is the federal court system similar to the state court system on the issue of jurisdiction?

13. What reasons did the framers of the US Constitution have for establishing federal courts?

14. What are the consequences of having state court systems and a parallel federal system?

15. Study the information concerning the Robinsons case here: http://www.wikilawschool.net/wiki/World-Wide_Volkswagen_Corp._v._Woodson. What is the outcome of the case?

Exercise 4.