For most people, the only time they see a court case in action is on a television court drama like Law & Order.
But a civil case like debt collection or bankruptcy is very different from a criminal case.
In a criminal case things are pretty straight forward. You break the law, you go to court, you face a judge, most of the time a jury of your peers, and a public prosecutor representing the state.
Civil matters are a little more complex. For one thing, the party suing is seeking either money or trying to get you to do something you don’t want to do, but were obligated to (called specific performance). For another, the only time a person is entitled to a jury in a civil case is when a person is seeking money damages under Federal Law. Third, unless you are being sued by, or are suing a state or the federal government, the person representing the other party is a private attorney and not a public servant.
As stated before, both collection actions and bankruptcy are civil matters. Actions to collect on a debt are based on contract law, which is governed by state law. Bankruptcy, on the other hand, is a hybrid area of law, controlled by both State and Federal law. In order to understand how to manage either of these cases, you should know how both systems work separately and together to form the US legal system.
First, let’s take a look at the state courts.
The first and bottom most layer of the state court system is the trial court. The trial courts are the courts of first hearing in each state, meaning this is where a civil suit or criminal matter usually starts. These courts hear cases like collections, which is a civil matter, for the first time. If a creditor or collection agency wants to sue you to get the money they are owed, then they can only sue you in the county where you live, because Federal and State law says that is the proper place to sue.
The next layer of the court system is the State Circuit Court. The circuit courts hear state specific matters, like state tax cases. Above the Circuit courts are the state appellate courts. The appellate courts hear cases from the county and circuit courts when one party is unhappy with the verdict in their first case, or believe the judge in the first case made a mistake.
The top layer of a state court system is the State Supreme Court. State Supreme Courts are courts of appeals, just like the state appellate court. They hear appeals when one party in the case is unhappy with the judgment of the appellate court or has found a reason why the appellate judge’s ruling was incorrect. A state Supreme Court can also be the first court to hear a case if one of the parties or the State Supreme court, believes the Circuit court is not the proper place to hear the case. Simple right? But hold on, this is where things start getting more complicated.
Every one of the 50 states has their own different state court system, their own variations on enforcement and procedure. This is where Federal Law and the Federal court system steps in to try and level the field.
Under the US Constitution, the Federal government can tell the state governments which laws they have to enforce and which laws the state can decide on their own, in order to try and provide a uniform system of laws and court procedure.
The first layer of the federal court system is the Federal District Court. Like the county courts, these courts are where cases can be heard for the first time. Usually the cases that start in Federal court are cases that involve Federal law, but not always. Just as sometimes a state court can apply the law of another state, Federal courts can, and frequently do, apply the law of the state where the district court is located.
Bankruptcy cases are a good example of this. Bankruptcy is one of the few areas of law (Patent, Admiralty, and Immigration being the others) that can only be heard in Federal court, and for the most part falls under Federal law. However, when determining the exemptions that a debtor is allowed during bankruptcy, state law controls.
The second layer of the Federal Court system is comprised of the Federal Courts of Appeal. The Federal Court of Appeals is exactly like the State Court of Appeals, with one very important difference. The Federal Court of Appeals is the court of first hearing for patents that are pending with the USPTO.
The third and final layer of the court system in the United States is the United States Supreme Court, probably the most famous court in the US. The Supreme Court, as its name suggests, is the highest court in the land. Its judges are not elected, unlike the judges in the other courts, but appointed by the President, subject to Congressional oversight. The Supreme Court hears criminal and civil appeals from State Supreme Courts, as well as from the Federal Court of Appeals. The Supreme Court can also be a court of first hearing for certain limited matters, but usually only hears disputes between two states.
If you are having trouble navigating the court system and help, don’t hesitate to find a lawyer to help you. A licensed lawyer from your state can make sure that the law remains easy to digest and make sure your rights are enforced!