Chapter 3

Courts and Alternative
Dispute Resolution

Answers to Learning Objectives/ For Review Questions at the Beginning and the End of the Chapter

Note that your students can find the answers to the even-numbered For Review questions in Appendix F at the end of the text. We repeat these answers here as a convenience to you.

1A Judicial review
The courts can decide whether the laws or actions of the legislative and executive branches of government are constitutional. The process for making this determi­nation is judicial review. The doctrine of judicial review was established in 1803 when the United States Supreme Court decided Marbury v. Madison.

2A Jurisdiction
To hear a case, a court must have jurisdiction over the person
If another party could freely void such an agreement, there would be a greater risk of arbitration in an inconvenient forum, costly formal litigation, or both. That risk increases the perceived costs of doing business, making the business opportunity less attractive. Thus, many parties may decline to enter contracts without enforceable arbitration provisions.

Answers to Questions in the Reviewing Feature at the End of the Chapter

1A. Federal jurisdiction
The federal district court can exercise jurisdiction in this case because the case involves diversity of citizenship. Diversity jurisdiction requires that the plaintiff and defendant be from different states and that the dollar amount of the controversy exceed $75,000. Here, Garner resides in Illinois, and Foreman and his manager live in Texas. Because the dispute involved the promotion of a series of boxing matches with George Foreman, the amount in controversy likely exceeded the required threshold amount.

2A. Original or appellate jurisdiction
Original jurisdiction, because the case was initiated in that court and that is where the trial will take place. Courts having original jurisdiction are courts of the first instance, or trial courts—that is courts in which lawsuits begin, trials take place, and evidence is presented. In the federal court system, the district courts are the trial courts, so the federal district