n. the total of cost, insurance and freight charges to be paid on goods purchased and shipped.
1) n. the list of cases to be called for trial before a particular court; 2) v. to set and give a date and time for a case, petition or motion to be heard by a court. Usually a judge, a trial setting commissioner, or the clerk of the court calendars cases.
n. the hearing at which a case is set for trial.
n. the demand by a corporation that a stockholder pay an installment or assessment on shares already owned.
n. the intentional and generally vicious false accusation of a crime or other offense designed to damage one’s reputation.
v. to cross out, annul, destroy, void and/or rescind a document. Cancelling can be done in several ways: tear up the document or mark on its face that it is cancelled, void, or terminated if the debt for which it stood has been paid. It is important that the document (like a promissory note) itself become no longer operative either by destruction or marking, so that it cannot be used again.
1) n. from Latin for caput, meaning “head,” the basic assets of a business (particularly corporations or partnerships) or of an individual, including actual funds, equipment and property as distinguished from stock in trade, inventory, payroll, maintenance and services. 2) adj. related to the basic assets or activities of a business or individual, such as capital account, capital assets, capital expenditure, and capital gain or loss. 3) n. an amount of money a person owns, as in “how much capital do you have to put into this investment?” as distinguished from the amount which must be financed.
n. the record which lists all basic assets of a business, not including inventory or the alleged value of good will.
n. equipment, property, and funds owned by a business.
n. payment by a business for basic assets such as property, fixtures, or machinery, but not for day-to-day operations such as payroll, inventory, maintenance and advertising. Capital expenditures supposedly increase the value of company assets and are usually intended to improve productivity.
The profit on the sale of a capital asset, such as stock or real estate.The difference between the sales price and the original cost (plus improvements) of property.
The original amount paid by investors into a corporation for its issued stock. Capital stock bears no direct relationship to the present value of stock, which can fluctuate after the initial issue or first stock offering. Capital stock also does not reflect the value of corporate assets, which can go up or down based on profits, losses, or purchases of equipment. Capital stock remains as a ledger entry at the original price.
n. 1) the act of counting anticipated earnings and expenses as capital assets (property, equipment, fixtures) for accounting purposes. 2) the amount of anticipated net earnings which hypothetically can be used for conversion into capital assets.
The accrued interest that is added to the principal balance of a loan while you are not making payments or your payments are insufficient to cover both the principal and interest due. When this happens, you end up paying interest on interest, sometimes called “negative amortization.”
n. anticipated earnings which are discounted (given a lower value) so that they represent a more realistic current value since projected earnings do not always turn out as favorably as expected or hoped.
A heading on all pleadings submitted to the court. It states basic information such as the parties names, court and case number. Each jurisdiction has its own rules as to the exact format of the caption.
n. in law, to be attentive, prudent and vigilant. Essentially, care (and careful) means that a person does everything he/she is supposed to do (to prevent an accident). It is the opposite of negligence (and negligent), which makes the responsible person liable for damages to persons injured. If a person “exercises care,” a court cannot find him/her responsible for damages from an accident in which he/she is involved.
n. in general, any person or business which transports property or people by any means of conveyance (truck, auto, taxi, bus, airplane, railroad, ship), almost always for a charge. The carrier is the transportation system and not the owner or operator of the system. There are two types of carriers: common carrier (in the regular business or a public utility of transportation) and a private carrier (a party not in the business, which agrees to make a delivery or carry a passenger in a specific instance). Common carriers are regulated by states and by the Interstate Commerce Commission if they cross state lines.
n. in taxation accounting, using a current tax year’s deductions, business losses or credits to refigure and amend a previously filed tax return to reduce the tax liability.
Carrying for hire
n. the act of transporting goods or individuals for a fee. It is important to determine if the carrier has liability for safe delivery or is subject to regulation.
Carrying on business
v. pursuing a particular occupation on a continuous and substantial basis. There need not be a physical or visible business “entity” as such.
The tax basis of someone who receives a gift. The recipient’s basis is the same as the giver’s; it simply “carries over” when the gift is made.
A term that most often refers to a lawsuit. “Case” also refers to a written decision by a judge — or for an appellate case, a panel of judges. Finally, the term also describes the evidence a party submits in support of her position.
n. reported decisions of appeals courts and other courts which make new interpretations of the law and, therefore, can be cited as precedents. These interpretations are distinguished from “statutory law,” which is the statutes and codes (laws) enacted by legislative bodies; “regulatory law,” which is regulations required by agencies based on statutes; and in some states, the common law, which is the generally accepted law carried down from England. The rulings in trials and hearings which are not appealed and not reported are not case law and, therefore, not precedent or new interpretations. Law students principally study case law to understand the application of law to facts and learn the courts’ subsequent interpretations of statutes. The entire collection of published legal decisions of the courts which, because of stare decisis, contributes a large part of the legal rules which apply in modern society.
Case of first impression
n. a case in which a question of interpretation of law is presented which has never arisen before in any reported case. Sometimes, it is only of first impression in the particular state or jurisdiction, so decisions from other states or the federal courts may be examined as a guideline.
n. the method of studying law generally used in American law schools, in which the students read, outline (brief), discuss and hear lectures about the cases. Each case presented stands for a particular rule of law in the subject matter covered and is contained in “casebooks” on particular topics (contracts, torts, criminal law, constitutional law, agency, etc.). The system is useful since it relates the law to real and factual situations which assist students in memorization and encourages deductive reasoning. The case system is reinforced by textbooks and outlines on the subject matter, which were formerly the principal sources of learning.
Cash surrender value
The amount of cash available upon voluntary termination of an insurance policy before the insurance benefits become payable.
n. a check issued by a bank on its own account for the amount paid to the bank by the purchaser with a named payee, and stating the name of the party purchasing the check (the remitter). The check is received as cash since it is guaranteed by the bank and does not depend on the account of a private individual or business. Cashiers’ checks are commonly used when payment must be credited immediately upon receipt for business, real estate transfers, tax payments and the like.
adj. defining something that happens by chance, without being foreseen, or informally. This includes “casual” labor or employment, which is someone hired to do a task just because he/she was available at the moment. “Casual laborer” carries the implication that the laborer does not belong to a union and that the employer and the laborer will not pay appropriate taxes on the wages paid.
n. 1) an accident which could not have been foreseen or guarded against, such as a shipwreck caused by storm or fire caused by lightning. 2) the loss, as of life, from such an unavoidable accident. The courts remain inconsistent on the exact definition.
n. in taxation, loss due to damage which qualifies for a casualty loss tax deduction. It must be caused by a sudden, unexpected or unusual occurrence such as a storm, flood, fire, shipwreck, earthquake or act of God, but would not include gradual damage from water seepage or erosion.
from Latin causa 1) v. to make something happen. 2) n. the reason something happens. A cause implies what is called a “causal connection” as distinguished from events which may occur but do not have any effect on later events.
Cause of action
A specific legal claim — such as for negligence, breach of contract or medical malpractice — for which a plaintiff seeks compensation. Each cause of action is divided into discrete elements, all of which must be proved to present a winning case.
Cease and desist order
n. an order of a court or government agency to a person, business or organization to stop doing something upon a strong showing that the activity is harmful and/or contrary to law. The order may be permanent or hold until a final judicial determination of legality occurs. In many instances the activity is believed to cause irreparable damage such as receipt of funds illegally, felling of timber contrary to regulation, selling of shares of stock without a proper permit, or oil drilling which would damage the ecology.
Certificate of deposit (CD)
n. a document issued by a bank in return for a deposit of money which pays a fixed interest rate for a specified period (from a month to several years). Interest rates on CD’s are usually higher than savings accounts because banking institutions require a commitment to leave money in the CD for a fixed period of time. Often there is a financial penalty (fee) for cashing in a CD before the pledged time runs out.
Certificate of incorporation
n. document which some states issue to prove a corporation’s existence upon the filing of articles of incorporation. In most states the articles are sufficient proof.
Certificate of title
n. generally, the title document for a motor vehicle issued by the state in which it is registered, describing the vehicle by type and engine number, as well as the name and address of the registered owner and the lienholder (financial institution that loaned money to buy the car). Since in some states these documents are usually pink, the certificate of title is sometimes called a “pink slip.”
A name, symbol, or other device used by an organization to vouch for the quality of products and services provided by others, for example, the “AAA Approved” sign found at hotels.
n. a check issued by a bank which certifies that the maker of the check has enough money in his/her account to cover the amount to be paid. The bank sets aside the funds so that the check will remain good even if other checks are written on the particular account. Like a cashier’s check, a certified check guarantees that it is immediately good since it is guaranteed by the bank and the recipient does not have to wait until it “clears.”
A copy of a document issued by a court or government agency guaranteed to be a true and exact copy of the original. Many agencies and institutions require certified copies of legal documents before permitting certain transactions. For example, a certified copy of a death certificate is required before a bank will release the funds in a deceased person’s payable-on-death account to the person who has inherited them.
a writ (order) of a higher court to a lower court to send all the documents in a case to it so the higher court can review the lower court’s decision. Certiorari is most commonly used by the U.S. Supreme Court, which is selective about which cases it will hear on appeal. To appeal to the Supreme Court one applies to the Supreme Court for a writ of certiorari, which it grants at its discretion and only when at least three members believe that the case involves a sufficiently significant federal question in the public interest. By denying such a writ the Supreme Court says it will let the lower court decision stand, particularly if it conforms to accepted precedents (previously decided cases).
Cestui que trust
1) an old-fashioned expression for the beneficiary of a trust. 2) “the one who trusts” or the person who will benefit from the trust and will receive payments or a future distribution from the trust’s assets.
Cestui que use
n. an old-fashioned term for a person who benefits from assets held in a trust for the beneficiary’s use. The term “beneficiary” is now used instead.
Chain of title
n. the succession of title ownership to real property from the present owner back to the original owner at some distant time. Chains of title include notations of deeds, judgments of distribution from estates, certificates of death of a joint tenant, foreclosures, judgments of quiet title (lawsuit to prove one’s right to property title) and other recorded transfers (conveyances) of title to real property. Usually title companies or abstractors are the professionals who search out the chain of title and provide a report so that a purchaser will be sure the title is clear of any claims.
n. the right of each attorney in a jury trial to request that a juror be excused. There may be a “challenge for cause” on the basis the juror had admitted prejudice or shows some obvious conflict of interest (e.g. the juror used to work for the defendant or was once charged with the same type of crime) which the judge must resolve. If the juror is excused (removed) “for cause,” then the challenge does not count against the limited number of challenges allowed each side. More common is the “peremptory challenge,” which is a request that a juror be excused without stating a reason. An attorney might say: “Juror number eight may be excused.” Only six or eight peremptory challenges are normally allowed each side. Systematic peremptory challenges of all blacks or all women may be examples and proof that a defendant has been deprived of a jury of his/her peers and result in an appeal based on lack of due process.
Challenge for cause
A party’s request that the judge dismiss a potential juror from serving on a trial jury by providing a valid legal reason why he shouldn’t serve. Potential bias is a common reason potential jurors are challenged for cause — for example, the potential juror is a relative of a party or one of the lawyers, or admits to a prejudice against one party’s race or religion. Judges can also dismiss a potential juror for cause. There is no limit on the number of successful challenges for cause. Compare peremptory challenges.
n. the private office of a judge, usually close to the courtroom so that the judge can enter the court from behind the bench and not encounter people on the way. Judges hear some motions, discuss formal legal problems like jury instructions, or conduct hearings on sensitive matters such as adoptions “in chambers.”
n. an agreement between the party suing in a lawsuit (plaintiff) and another person, usually an attorney, who agrees to finance and carry the lawsuit in return for a percentage of the recovery (money won and paid). In common law this was illegal on the theory that it encouraged lawsuits. Today it is legal and often part of a “contingent fee” agreement between lawyer and client. It is not the same as barratry, which is active encouragement of lawsuits.
Change of circumstances
n. the principal reason for a court modifying (amending) an existing order for the payment of alimony and/or child support. The change may be an increase or decrease in the income of either the party obligated to pay or the ex-spouse receiving payment, or the health, the employment, or needs of either party. Thus, if an ex-husband’s income is substantially increased or the ex-wife becomes ill and cannot work, the judge may order the ex-husband to pay her more. Remarriage of a spouse who is receiving alimony automatically terminates the alimony order, unless there is a special provision that it continue, which is rare.
1) in jury trials, the oral instructions by the judge to the jurors just before the jury begins deliberations. This charge is based on jury instructions submitted by attorneys on both sides and agreed upon by the trial judge. 2) a fee for services.
n. in taxation, a contribution to an organization which is officially created for charitable, religious, educational, scientific, artistic, literary, or other good works. Such contributions are deductible from gross income, and thus lower the taxes paid.
Any trust designed to make a substantial gift to a charity and also achieve income and estate tax savings for the person who creates the trust (the grantor).
n. an item of personal property which is movable, as distinguished from real property (land and improvements).
n. an outmoded written document which made a chattel (tangible personal asset) security for a loan of a certain amount. It has been replaced in most states by a security agreement, the form of which is designated in a Uniform Commercial Code as UCC-1. UCC-1 security agreements must be filed with a specific public agency (e.g. a state Secretary of State) to protect buyers of the personal property and lenders making loans secured by the property.
n. a draft upon a particular account in a bank, in which the drawer or maker (the person who has the account and signs the check) directs the bank to pay a certain amount to the payee (which may include the drawer, “cash,” or someone else). Other checks include cashier’s checks issued by the bank for a sum paid to the bank, and certified checks in which the bank sets aside an amount from the maker’s bank account and then guarantees the check can be cashed immediately.
1) A son or daughter of any age, sometimes including biological offspring, unborn children, adopted children, stepchildren, foster children and children born outside of marriage. 2) A person under an age specified by law, often 14 or 16. For example, state law may require a person to be over the age of 14 to make a valid will, or may define the crime of statutory rape as sex with a person under the age of 16. In this sense, a child can be distinguished from a minor, who is a person under the age of 18 in most states. A person below the specified legal age who is married is often considered an adult rather than a child. See also emancipation.
n. a court’s determination of which parent, relative or other adult should have physical and/or legal control and responsibility for a minor (child) under 18. Child custody can be decided by a local court in a divorce or if a child, relative, close friend or state agency questions whether one or both parents is unfit, absent, dead, in prison or dangerous to the child’s well-being. In such cases custody can be awarded to a grandparent or other relative, a foster parent or an orphanage or other organization or institution. While a divorce is pending the court may grant temporary custody to one of the parents, require conferences or investigation (in some states, if the parents cannot agree, custody is automatically referred to a mediator, commissioner or social worker) before making a final ruling. There is a difference between physical custody, which designates where the child will actually live, and legal custody, which gives the custodial person(s) the right to make decisions for the child’s welfare. If the parents agree, the court can award joint custody, physical and/or legal. Joint legal custody is becoming increasingly common. The basic consideration on custody matters is supposed to be the best interests of the child or children. In most cases the non-custodial parent is given visitation rights, which may include weekends, parts of vacations and other occasions. The court can always change custody if circumstances warrant.
The entitlement of all children to be supported by their parents until the children reach the age of majority or become emancipated — usually by marriage, by entry into the armed forces or by living independently. Many states also impose child support obligations on parents for a year or two beyond this point if the child is a full-time student. If the parents are living separately, they each must still support the children. Typically, the parent who has custody meets his or her support obligation through taking care of the child every day, while the other parent must make payments to the custodial parent on behalf of the child — usually cash but sometimes other kinds of contributions. When parents divorce, the court almost always orders the non-custodial parent to pay the custodial parent an amount of child support fixed by state law. Sometimes, however, if the parents share physical custody more or less equally, the court will order the higher-income parent to make payments to the lower-income parent.
n. the unethical and usually illegal practice of excessive buying and selling of shares of stock for a customer by a stockbroker or sales agent for the purpose of obtaining high sales commissions.
The name used for the principal trial court in many states. In the federal system, appellate courts are organized into thirteen circuits. Eleven of these cover different geographical areas of the country — for example, the United States Court of Appeal for the Ninth Circuit covers Alaska, Arizona, California, Hawaii, Idaho, Montana, Nevada, Oregon and Washington. The remaining circuits are the District of Columbia Circuit and the Federal Circuit, (which hears patent, customs and other specialized cases based on subject matter). The term derives from an age before mechanized transit, when judges and lawyers rode “the circuit” of their territory to hold court in various places.
Evidence that proves a fact by means of an inference. For example, from the evidence that a person was seen running away from the scene of a crime, a judge or jury may infer that the person committed the crime.
n. 1) a notice to appear in court due to the probable commission of a minor crime such as a traffic violation, drinking liquor in a park where prohibited, letting a dog loose without a leash, and in some states for possession of a small amount of marijuana. Failure to appear can result in a warrant for the citee’s arrest. 2) a notice to appear in court in a civil matter in which the presence of a party appears necessary, usually required by statute, such as a person whose relatives wish to place him/her under a conservatorship (take over and manage his/her affairs). 3) the act of referring to (citing) a statute, precedent-setting case or legal textbook, in a brief (written legal court statement) or argument in court, called “citation of authority.” 4) the section of the statute or the name of the case as well as the volume number, the report series and the page number of a case referred to in a brief, points and authorities, or other legal argument. Example: United States vs. Wong Kim Ark, (1898) 169 U.S. 649, which is the name of the case, the year when decided, with the decision found at volume 169 of the United States [Supreme Court] Reporter at page 649. A citation also refers to the case itself, as in “counsel’s citation of the Wong case is not in point.” An order of a court to either do a certain thing or to appear before it to answer charges.
v. to make reference to a decision in another case to make a legal point in argument.
n. person who by place of birth, nationality of one or both parents, or by going through the naturalization process has sworn loyalty to a nation.
adj. 1) that part of the law that encompasses business, contracts, estates, domestic (family) relations, accidents, negligence and everything related to legal issues, statutes and lawsuits, that is not criminal law.2) referring to one’s basic rights guaranteed under the Constitution (and the interpretations and statutes intended to implement the enforcement of those rights) such as voting, equitable taxation, freedom of speech, press, religion and assembly. Generally these are referred to as “civil rights”. Violation of one’s civil rights may be a crime under federal and/or state statutes. Civil rights include civil liberties. Civil liberties emphasize protection from infringement upon basic freedoms, while statutory rights are based on laws passed by Congress or state legislatures.
n. the list of lawsuits (cases) that are approaching trial in any court. Attorneys and/or parties whose cases are coming to the top of the list receive notice of the “calling” of the civil calendar on a particular day for setting a trial date. Unfortunately, some courts are so clogged with pending lawsuits that one case may be called on several civil calendars, possibly months apart, before being finally sent to trial.
A noncriminal lawsuit, usually involving private property rights. For example, lawsuits involving breach of contract, probate, divorce, negligence and copyright violations are just a few of the many hundreds of varieties of civil lawsuits.
n. in many states, the name for the collection of statutes and laws which deal with business and negligence lawsuits and practices.
n. 1) a body of laws and legal concepts which come down from old Roman laws established by Emperor Justinian, and which differ from Englishcommon law, which is the framework of most state legal systems. In the United States only Louisiana (relying on the French Napoleonic Code) has a legal structure based on civil law. 2) generic term for non-criminal law.
n. potential responsibility for payment of damages or other court-enforcement in a lawsuit, as distinguished from criminal liability, which means open to punishment for a crime.
n. rights or freedoms given to the people by the First Amendment to the Constitution, by Common Law, or legislation, allowing the individual to be free to speak, think, assemble, organize, worship, or petition without government (or even private) interference or restraints. These liberties are protective in nature, while civil rights form a broader concept and include positive elements such as the right to use facilities, the right to an equal education, or the right to participate in government.
n. fines or surcharges imposed by a governmental agency to enforce regulations such as late payment of taxes, failure to obtain a permit, etc.
The rules used to handle a civil case from the time the initial complaint is filed through pretrial discovery, the trial itself and any subsequent appeal. Each state adopts its own rules of civil procedure (often set out in a separate Code of Civil Procedure), but many are influenced by or modeled on the Federal Rules of Civil Procedure.
n. those rights guaranteed by the Bill of Rights, the 13th and 14th Amendments to the Constitution, including the right to due process, equal treatment under the law of all people regarding enjoyment of life, liberty, property, and protection. Positive civil rights include the right to vote, the opportunity to enjoy the benefits of a democratic society, such as equal access to public schools, recreation, transportation, public facilities, and housing, and equal and fair treatment by law enforcement and the courts.
1) v. to make a demand for money, for property, or for enforcement of a right provided by law. 2) n. the making of a demand (asserting a claim) for money due, for property, from damages or for enforcement of a right. If such a demand is not honored, it may result in a lawsuit. In order to enforce a right against a government agency (ranging for damages from a negligent bus driver to a shortage in payroll) a claim must be filed first. If rejected or ignored by the government, it is lawsuit time.
Claim in bankruptcy
n. the written claim filed by persons or businesses owed money (creditors) by a party who files for bankruptcy (debtor) to benefit from the distribution if money becomes available. The known creditors receive written notice of the bankruptcy and will receive a creditor’s claim form. They may also receive notice that the bankrupt party has no assets to distribute and that they should not file a claim until further notice (this is bad news for the creditor).
n. in legal terms, all those persons in the same category, level of rights (e.g. heirs of dead person who are related by the same degree), or who have suffered from the same incident. Whether a person is part of a class is often crucial in determining who can sue on behalf of the people who have been similarly damaged or collect his/her share if a class action judgment is given.
A lawsuit in which a large number of people with similar legal claims join together in a group (the class) to sue someone, usually a company or organization. Common class actions involve cases in which a product has injured many people, or in which a group of people has suffered discrimination at the hands of an organization.
Clean hands doctrine
n. a rule of law that a person coming to court with a lawsuit or petition for a court order must be free from unfair conduct (have “clean hands” or not have done anything wrong) in regard to the subject matter of his/her claim. His/her activities not involved in the legal action can be abominable because they are considered irrelevant. As an affirmative defense (positive response) a defendant might claim the plaintiff (party suing him/her) has a “lack of clean hands” or “violates the clean hands doctrine” because the plaintiff has misled the defendant or has done something wrong regarding the matter under consideration. Example: A former partner sues on a claim that he was owed money on a consulting contract with the partnership when he left, but the defense states that the plaintiff (party suing) has tried to get customers from the partnership by spreading untrue stories about the remaining partner’s business practices.
Clear and convincing evidence
n. evidence that proves a matter by the “preponderance of evidence” required in civil cases and beyond the “reasonable doubt” needed to convict in a criminal case.
Clear and present danger
Speech that poses a “clear and present danger” to the public or government will not be protected under the First Amendment’s guarantee of free speech. The classic example is that shouting “Fire!” in a crowded theatre is not protected speech.
n. holding ownership of real property without any claims by others on the owner’s title and no history of past claims which might affect the ownership.
n. 1) an official or employee who handles the business of a court or a system of courts, maintains files of each case, and issues routine documents. Almost every county has a clerk of the courts or County Clerk who fulfills those functions, and most courtrooms have a clerk to keep records and assist the judge in the management of the court. 2) a young lawyer who assists a judge or a senior attorney in research and drafting of documents, usually for a year or two, and benefits in at least two ways: learning from the judge or attorney and enjoying association with them. Law clerks for judges, particularly on the Courts of Appeal and the Supreme Court, are chosen from among the top students graduating from law school. 3) a person who works in an office or a store who performs physical work such as filing, stocking shelves, or counter sales.
A corporation owned and operated by a few individuals, often members of the same family, rather than by public shareholders. State laws permit close corporations to function more informally than regular corporations. For example, shareholders can make decisions without holding meetings of the board of directors, and can fill vacancies on the board without a vote of the shareholders.
n. the final step in the sale and purchase of real estate in which a deed of title, financing documents, title insurance policies, and remaining funds due are exchanged. Some of the final documents, including the deed and mortgage or deed of trust, are then delivered to the county recorder to be recorded. Depending on local practice, the closing is handled by a title company, escrow holder or attorney.
At trial, a speech made by each party after all the evidence has been presented. The purpose is to review the testimony and evidence presented during the trial as part of forcefully explaining why your side should win. Especially in trials before a judge without a jury, it is common for both parties to waive their closing argument on the theory that the judge has almost surely already arrived at her decision.
Cloud on title (cloud)
n. an actual or apparent outstanding claim on the title to real property. “Clouds” can include an old mortgage or deed of trust with no recording showing the secured debt was paid off, a failure to properly transfer all interests in the real property (such as mineral rights) to a former owner, a previous deed which was improperly written or signed, an unresolved legal debt or levy by a creditor or a taxing authority, or some other doubtful link in the chain of title. Often the “cloud” can be removed by a quiet title action, by finding a person to create or execute a document to prove a debt had been paid or corrected. Title companies will refuse to insure title to be transferred with a “cloud,” or they will insure ownership except for (“insure around”) the “cloud.”
Two or more tenants who rent the same property under the same lease or rental agreement. Each co-tenant is 100% responsible for carrying out the rental agreement, which includes paying the entire rent if the other tenant skips town and paying for damage caused by the other tenant.
n. a trustee of a trust when there is more than one trustee serving at the same time, usually with the same powers and obligations. Occasionally a co-trustee may be a temporary fill-in, as when the original trustee is ill but recovers. The co-trustee must act in consultation with the other trustee(s), unless the language of the trust allows one co-trustee to act alone.
n. a collection of written laws gathered together, usually covering specific subject matter. Thus, a state may have a civil code, corporations code, education code, evidence code, health and safety codes, insurance code, labor code, motor vehicle code, penal code, revenue and taxation code, and so forth. Federal statutes which deal with legal matters are grouped together in codes. There are also statutes which are not codified. Despite their apparent permanence, codes are constantly being amended by legislative bodies. Some codes are administrative and have the force of law even though they were created and adopted by regulatory agencies and are not actually statutes or laws.
Code of Professional Responsibility
n. a set of rules governing the ethical conduct of attorneys in the practice of the law. It covers such topics as conflicts of interest, honesty with clients, confidentiality and conduct toward other attorneys and the courts. First developed and pushed by the American Bar Association, the code has been adopted by most states.
n. when more than one person or entity is sued in one lawsuit, each party sued is called a codefendant.
A supplement or addition to a will. A codicil may explain, modify, add to, subtract from, qualify, alter or revoke existing provisions in a will. Because a codicil changes a will, it must be signed in front of witnesses, just like a will.
v. to arrange and label a system of laws.
n. an insurance policy in which the insurance company insures only a partial value of the property owned by the insured owner. Essentially the owner and the insurance company share the risk.
Property that guarantees payment of a secured debt.
A company hired by a creditor to collect a debt that it is owed. Creditors typically hire a collection agency only after they have made efforts to collect the debt themselves, typically through letters (called “dunning” letters) and telephone calls. Collection agencies are regulated by the federal Fair Debt Collection Practices Act. Unfortunately, too many collectors ignore this law.
A name, symbol or other device used by members of a group or organization to identify goods or services it provides. For example, the letters ILGWU on a shirt label signify that the shirt was made by a member of the International Ladies’ Garment Workers’ Union.
For copyright purposes, a work, such as a periodical, anthology or encyclopedia, in which a number of separate and independent works are assembled into one work. To create a collective work, permission must be obtained from the owners of the copyrights of the constituent parts (assuming such parts are not already in the public domain). Although the author of the compilation may not own the copyright to any of the individual parts, the creativity involved in selecting and organizing the constituent materials is in itself protected by copyright.
Collision insurance coverage
A component of car insurance that pays for damages to the insured vehicle that result from a collision with another vehicle or object. Collision insurance generally covers the amount of damage over and above an amount the insured person must pay, called the “deductible” amount.
n. where two persons (or business entities through their officers or other employees) enter into a deceitful agreement, usually secret, to defraud and/or gain an unfair advantage over a third party, competitors, consumers or those with whom they are negotiating. Collusion can include secret price or wage fixing, secret rebates, or pretending to be independent of each other when actually conspiring together for their joint ends.
n. a lawsuit brought by parties pretending to be adversaries in order to obtain by subterfuge an advisory opinion or precedent-setting decision from the court. If a judge determines the action does not involve a true controversy he/she will dismiss it.
n. when two or more people sign a check or a promissory note, each is a comaker, and each is liable for the entire amount to be paid.
n. a statement made by a judge or an attorney during a trial which is based on an alleged fact, but not a proven fact
Trade that the federal government is authorized to regulate. To qualify for federal trademark protection and registration, a mark must have first been used in commerce. In practice, this means that a product or service must be sold outside of the state in which it originates, be advertised out of state or cater to travelers, such as a hotel, before it can qualify for trademark protection.
n. an unforeseen uncontrollable event which occurs after a written or oral contract is entered into between parties, and makes it impossible for one of the parties to fulfill his/her duties under the contract. This circumstance allows the frustrated party to rescind the contract without penalty. Such frustration (called frustration of purpose) could include the destruction by fire of the goods to be purchased, the denial of a permit to construct a building by a potential buyer, or denial of an application for a zoning variance to allow expansion by a contractor.
n. all the law which applies to the rights, relations and conduct of persons and businesses engaged in commerce, merchandising, trade and sales. In recent years this body of law has been codified in the Uniform Commercial Code, which has been almost universally adopted by the states.
n. the act of mixing the funds belonging to one party with those of another party, or, most importantly with funds held in trust for another. Spouses or business partners may commingle without a problem, except that a spouse may thus risk turning separate property into community property (transmutation), and a business partner may have to account to the other. However, trustees, guardians or lawyers holding client funds must be careful not to commingle those funds with their own, since commingling is generally prohibited as a conflict of interest. Use of commingled funds for an investment, even though it might benefit both the trustee and the beneficiary, is still improper. Inadvertent commingling or temporary commingling (say, upon receipt of a settlement check in which both the client and attorney have an interest) requires prompt separation of funds and accounting to the client or beneficiary. To avoid commingling, trustees, lawyers, guardians and those responsible for another’s funds set up trust accounts for funds of another.
n. 1) a fee paid based on a percentage of the sale made by an employee or agent, as distinguished from regular payments of wages or salary. 2) a group appointed pursuant to law to conduct certain government business, especially regulation. These range from the local planning or zoning commission to the Securities and Exchange Commission or the Federal Trade Commission.
n. a judge’s order sending someone to jail or prison, upon conviction or before trial, or directing that a mentally unstable person be confined to a mental institution. Technically the judge orders law enforcement personnel to take the prisoner or patient to such places.
n. in condominium and some cooperative housing projects, the areas not owned by an individual owner of the condominium or cooperative residence, but shared by all owners, either by percentage inter- est or owned by the management organization. Common areas may include recreation facilities, outdoor space, parking, landscaping, fences, laundry rooms and all other jointly used space. Management is by a homeowners’ association or cooperative board, which collects assessments from the owners and pays for upkeep, some insurance, maintenance and reserves for replacement of improvements in the common area. This can also refer to the area in a shopping center or mall outside of the individual stores, for which each business pays a share of maintenance based on percentage of total store space occupied.
n. an individual, a company or a public utility (like municipal buses) which is in the regular business of transporting people and/or freight. This is distinguished from a private carrier, which only transports occasionally or as a one-time-only event.
n. claims for debt alleged in a lawsuit (included in the complaint) which are general and alleged together so that the defendant cannot squirm out of liability on some technicality on one of the counts. Common counts may include claims of debt for goods sold and delivered, for work performed, for money loaned or advanced, for money paid requiring repayment, for money received on behalf of the plaintiff, or for money due on an account stated or on an open book account.
n. the traditional unwritten law of England, based on custom and usage, which began to develop over a thousand years before the founding of the United States. The best of the pre-Saxon compendiums of the common law was reportedly written by a woman, Queen Martia, wife of a king of a small English kingdom. Together with a book on the “law of the monarchy” by a Duke of Cornwall, Queen Martia’s work was translated into the emerging English language by King Alfred (849-899 A.D.). When William the Conqueror invaded England in 1066, he combined the best of this Anglo-Saxon law with Norman law, which resulted in the English common law, much of which was by custom and precedent rather than by written code. By the 14th century legal decisions and commentaries on the common law began providing precedents for the courts and lawyers to follow. It did not include the so-called law of equity (chancery), which came from the royal power to order or prohibit specific acts. The common law became the basic law of most states due to the Commentaries on the Laws of England, completed by Sir William Blackstone in 1769, which became every American lawyer’s bible. Today almost all common law has been enacted into statutes with modern variations by all the states except Louisiana, which is still influenced by the Napoleonic Code. In some states the principles of Common Law are so basic they are applied without reference to statute.
n. 1) real property owned by “tenants in common,” who each have an “undivided interest” in the entire property. 2) property managed by a homeowners’ association in a condominium project or a subdivision development, which all owners may use and each owns a percentage interest in. 3) lands owned by the government for public (common) use, like parks and national forests.
n. stock in a corporation in which dividends (payouts) are calculated upon a percentage of net profits, with distribution determined by the board of directors. Usually holders of common stock have voting rights. These are distinguished from preferred stock in which the profits are a predetermined percentage and are paid before the common shareholders who gamble on higher profits, and collectively have voting control of the corporation.
n. any formal business entity for profit, which may be a corporation, a partnership, association or individual proprietorship. Often people think the term “company” means the business is incorporated, but that is not true. In fact, a corporation usually must use some term in its name such as “corporation,” “incorporated,” “corp.” or “inc.” to show it is a corporation.
A doctrine that grants the spouse least at fault a divorce when both spouses have shown grounds for divorce. It is a response to an old common-law rule that prevented a divorce when both spouses were at fault.
n. a rule of law applied in accident cases to determine responsibility and damages based on the negligence of every party directly involved in the accident. Most cases are not as simple, and the formulas to figure out, attribute and compare negligence often make assessment of damages problematic, difficult, and possibly totally subjective. Not all states use comparative negligence (California is a fairly recent convert), and some states still use contributory negligence which denies recovery to any party whose negligence has added to the cause of the accident in any way. Contributory negligence is often so unfair that juries tend to ignore it.
n. 1) payment for work performed, by salary, wages, commission or otherwise. It can include giving goods rather than money. 2) the amount received to “make one whole” (or at least better) after an injury or loss, particularly that paid by an insurance company either of the party causing the damage or by one’s own insurer.
n. damages recovered in payment for actual injury or economic loss, which does not include punitive damages (as added damages due to malicious or grossly negligent action).
adj. 1) in general, able to act in the circumstances, including the ability to perform a job or occupation, or to reason or make decisions. 2) in wills, trusts and contracts, sufficiently mentally able to understand and execute a document. To be competent to make a will a person must understand what a will is, what he/she owns (although forgetting a few items among many does not show incompetency), and who are relatives who would normally inherit (“the natural objects of his/her bounty”) such as children and spouse (although forgetting a child in a will is not automatic proof of lack of competency, since it may be intentional or the child has been long gone). 3) in criminal law, sufficiently mentally able to stand trial, if he/she understands the proceedings and can rationally deal with his/her lawyer. This is often broadly interpreted by psychiatrists whose testimony may persuade a court that a party is too psychotic to be tried. If the court finds incompetency then the defendant may be sent to a state mental facility until such time as he/she regains sanity. At that time a trial may be held, but this is rare. 4) in evidence, “competent” means “relevant” and/or “material.” Lawyers often make the objection to evidence: “incompetent, irrelevant and immaterial” to cover all bases.
Legally admissible evidence. Competent evidence tends to prove the matter in dispute.
n. a person or entity who begins a lawsuit by filing a complaint and is usually called the plaintiff, or in some cases the petitioner.
Papers filed with a court clerk by the plaintiff to initiate a lawsuit by setting out facts and legal claims (usually called causes of action). In some states and in some types of legal actions, such as divorce, complaints are called petitions and the person filing is called the petitioner. To complete the initial stage of a lawsuit, the plaintiff’s complaint must be served on the defendant, who then has the opportunity to respond by filing an answer. In practice, few lawyers prepare complaints from scratch. Instead they use — and sometimes modify — pre-drafted complaints widely available in form books.
n. payment of interest upon principal and previously accumulated interest, which increases the amount paid for money use above simple interest. Thus, it can increase more rapidly if compounded daily, monthly or quarterly.
Comprehensive insurance coverage
An element of car insurance that pays for damages to your vehicle caused by anything other than a collision, including vandalism, theft and natural disasters.
1) n. an agreement between opposing parties to settle a dispute or reach a settlement in which each gives some ground, rather than continue the dispute or go to trial. Judges encourage compromise and settlement, which is often economically sensible, since it avoids mounting attorneys’ fees and costs. 2) v. to reach a settlement in which each party gives up some demands.
n. 1) in general, the end. 2) in a trial, when all evidence has been introduced and final arguments made, so nothing more can be presented, even if a lawyer thinks of something new or forgotten. 3) in a trial or court hearing, a final determination of the facts by the trier of fact (jury or judge) and/or a judge’s decision on the law.
Conclusion of fact
n. in a trial, the final result of an analysis of the facts presented in evidence, made by the trier of fact (a jury or by the judge if there is no jury). When a judge is the trier of fact he/she will present orally in open court or in a written judgment his/her findings of fact to support his/her decision. In most cases either party is entitled to written conclusion of facts if requested.
Conclusion of law
n. a judge’s final decision on a question of law which has been raised in a trial or a court hearing, particularly those issues which are vital to reaching a statement. These may be presented orally by the judge in open court, but are often contained in a written judgment in support of his/her judgment such as an award of damages or denial of a petition. In most cases either party is entitled to written conclusions of law if requested.
n. a term or requirement stated in a contract, which must be met for the other party to have the duty to fulfill his/her obligations.
n. 1) in a contract, an event which must take place before a party to a contract must perform or do their part. 2) in a deed to real property, an event which has to occur before the title (or other right) to the property will actually be in the name of the party receiving title.
n. 1) in a contract, a happening which terminates the duty of a party to perform or do his/her part. 2) in a deed to real property, an event which terminates a person’s interest in the property.
n. in a will, a gift which will take place only if a particular event has occurred by the time the maker of the will dies.
n. a sale of property or goods which will be completed if certain conditions are met (as agreed) by one or both parties to the transaction.
Conditions of carriage
The terms of your contract with an airline after you buy a ticket. Conditions of carriage cover everything from baggage limitations to the amount of compensation you can recover if you’re injured on the flight. These provisions often vary from airline to airline. A few, but by no means most, conditions of carriage appear in the fine print on the back of your ticket. To find out about the rest, you can ask the airline for a copy; it is legally obligated to provide one. The conditions of carriage contain a lot of fine print detail and will not make for exciting reading.
n. title to a unit of real property which, in reality, is the airspace which an apartment, office or store occupies. An increasingly common form of property title in a multi-unit project. The owner of the condominium also owns a common tenancy with owners of other units in the common area, which includes all the driveways, parking, elevators, outside hallways, recreation and landscaped areas, which are managed by a homeowners’ or tenant’s association. If the condominium unit is destroyed by fire or other disaster, the owner has the right to rebuild in his/her airspace. Most states have adopted statutes to cover special issues involving development, construction, management and taxation of condominium projects.
Information exchanged between two people who (1) have a relationship in which private communications are protected by law, and (2) intend that the information be kept in confidence. The law recognizes certain parties whose communications will be considered confidential and protected, including spouses, doctor and patient, attorney and client, and priest and confessor. Communications between these individuals cannot be disclosed in court unless the protected party waives that protection. The intention that the communication be confidential is critical. For example, if an attorney and his client are discussing a matter in the presence of an unnecessary third party — for example, in an elevator with other people present — the discussion will not be considered confidential and may be admitted at trial. Also known as privileged communication.
n. a relationship in which one person has confidence in and relies on another because of some combination of a history of trust, older age, family connection and/or superior training and knowledge, to a point where the party relied upon dominates the situation, for good or bad. While it may include attorney and client, stockbroker and customer, real estate agent and buyer, a senior family member and an unsophisticated relative, the relationship is defined on a case-by-case basis, with reliance and dominance the key factors. In this situation, the trusting party does not have to be as vigilant or suspicious as with strangers or people who are not relied upon.
v. to take one’s goods or property without legal right, although there may appear to be some lawful basis. In the case of a government seizing property, it may include taking without the just compensation as guaranteed by the Constitution. There are some acts of legal confiscation, such as taking an automobile used in illegal drug traffic.
Conflict of interest
n. a situation in which a person has a duty to more than one person or organization, but cannot do justice to the actual or potentially adverse interests of both parties. This includes when an individual’s personal interests or concerns are inconsistent with the best for a customer, or when a public official’s personal interests are contrary to his/her loyalty to public business. An attorney, an accountant, a business adviser or realtor cannot represent two parties in a dispute and must avoid even the appearance of conflict. He/she may not join with a client in business without making full disclosure of his/her potential conflicts, he/she must avoid commingling funds with the client, and never, never take a position adverse to the customer.
Conflict of law
n. a situation in which both state and federal laws or courts, or laws of more than one state, are applicable to a potential lawsuit or interpretation of a document and seem to be inconsistent or in conflict. The plaintiff’s attorney’s first problem is to decide in what state or federal court the lawsuit should be filed. This can apply to a dead person’s estate with property in several states, when people earn income in several states, are involved in business in several states, or violate both state and federal laws in one scheme. Also to be considered is the issue of federal preemption, which may dictate that the federal statutes have been given a monopoly on the subject (pre-empted the field) and that a federal court must try the case, but that it will apply the laws of the state where the controversy arose.
An exact copy of a document filed with a court. To conform a copy, the court clerk will stamp the document with the filing date and add any handwritten notations to the document that exist on the original, including dates and the judge’s signature. A conformed copy may or may not be certified.
adj. in the law of trademarks, when a trademark, logo or business name is so close to that of a pre-existing trademark, logo or name that the public might misidentify the new one with the old trademark, logo or name. Such confusion may not be found if the products or businesses are clearly not in the actual or potential product markets or geographic area of the other.
1) n. a voluntary agreement to another’s proposition. 2) v. to voluntarily agree to an act or proposal of another, which may range from contracts to sexual relations.
n. an order of a judge based upon an agreement, almost always put in writing, between the parties to a lawsuit instead of continuing the case through trial or hearing. It cannot be appealed unless it was based upon fraud by one of the parties (he lied about the situation), mutual mistake (both parties misunderstood the situation) or if the court does not have jurisdiction over the case or the parties. Obviously, such a decree is almost always final and non-appealable since the parties worked it out. A consent decree is a common practice when the government has sued to make a person or corporation comply with the law (improper securities practices, pollution, restraints of trade, conspiracy) or the defendant agrees to the consent decree (often not to repeat the offense) in return for the government not pursuing criminal penalties. In general a consent decree and a consent judgment are the same.
n. a judgment issued by a judge based on an agreement between the parties to a lawsuit to settle the matter, aimed at ending the litigation with a judgment that is enforceable.
n. damages claimed and/or awarded in a lawsuit which were caused as a direct foreseeable result of wrongdoing.
Someone appointed by a judge to oversee the affairs of an incapacitated person. A conservator who manages financial affairs is often called a “conservator of the estate.” One who takes care of personal matters, such as healthcare and living arrangements, is known as a “conservator of the person.” Sometimes, one conservator is appointed to handle all these tasks. Depending on where you live, a conservator may also be called a guardian, committee or curator.
The basis of a contract. Consideration is a benefit or right for which the parties to a contract must bargain; the contract is founded on an exchange of one form of consideration for another. Consideration may be a promise to perform a certain act — for example, a promise to fix a leaky roof — or a promise not to do something, such as build a second story on a house that will block the neighbor’s view. Whatever its particulars, consideration must be something of value to the people who are making the contract.
v. 1) to deliver goods to a merchant to sell on behalf of the party delivering the items, as distinguished from transferring to a retailer at a wholesale price for re-sale. Example: leaving one’s auto at a dealer to sell and split the profit. 2) to deliver to a carrier to be taken to an agent of the sender. 3) when a debtor has belongings but no money to pay his/her creditors and deposits his/her goods with a trustee who will sell them to raise money to pay the owner’s debts and creditors. This is done by agreement between a debtor and his/her creditors or by order of a bankruptcy judge.
n. a person or business holding another’s goods for sale or for delivery to a designated agent.
n. the act of consigning goods to one who will sell them for the owner or transport them for the owner.
1) A group of separate individuals or companies that come together to undertake an enterprise or transaction that is beyond the means of any one member. For example, a group of local businesses may form a consortium to fund and construct a new office complex. 2) The duties and rights associated with marriage. Consortium includes all the tangible and intangible benefits that one spouse derives from the other, including material support, companionship, affection, guidance and sexual relations. The term may arise in a lawsuit if a spouse brings a claim against a third party for “loss of consortium” after the other spouse is injured or killed.
A peace officer for a particular geographic area — most often a rural county — who commonly has the power to serve legal papers, arrest lawbreakers and keep the peace. Depending on the state, a constable may be similar to a marshal or sheriff.
n. the act of a lawyer or court in interpreting and giving meaning to a statute or the language of a document such as a contract or will when there is some ambiguity or question about its meaning. In constitutional law, there is a distinction between liberal construction (broad construction) and strict construction (narrow construction). Liberal construction adds modern and societal meanings to the language, while strict construction adheres closely to the original language and intent without interpretation.
When a landlord provides housing that is so substandard that a landlord has legally evicted the tenant. For example, if the landlord refuses to provide heat or water or refuses to clean up an environmental health hazard, the tenant has the right to move out and stop paying rent, without incurring legal liability for breaking the lease.
n. when the circumstances show that someone’s actions give him/her an unfair advantage over another by unfair means (lying or not telling a buyer about defects in a product, for example), the court may decide from the methods used and the result that it should treat the situation as if there was actual fraud even if all the technical elements of fraud have not been proven.
n. a fiction that a person got notice even though actual notice was not personally delivered to him/her. The law may provide that a public notice put on the courthouse bulletin board is a substitute for actual notice. A prime example is allowing service by publication when a spouse has left the state to avoid service (legal delivery of a legal notice) in a divorce action. The legal advertisement of the summons in an approved newspaper is treated as constructive notice, just as if the summons and petition had been served personally.
n. when a person does not have actual possession, but has the power to control an asset, he/she has constructive possession. Having the key to a safe deposit box, for example, gives one constructive possession.
n. when a person has title to property and/or takes possession of it under circumstances in which he/she is holding it for another, even though there is no formal trust document or agreement. The court may determine that the holder of the title holds it as constructive trustee for the benefit of the intended owner. This may occur through fraud, breach of faith, ignorance or inadvertence.
v. to determine the meaning of the words of a written document, statute or legal decision, based upon rules of legal interpretation as well as normal, widely accepted meanings.
Consumer protection laws
n. almost all states and the federal government have enacted laws and set up agencies to protect the consumer (the retail purchasers of goods and services) from inferior, adulterated, hazardous or deceptively advertised products, and deceptive or fraudulent sales practices. Federal statutes and regulations govern mail fraud, wholesome poultry and meat, misbranding and adulteration of food and cosmetics, truth in lending, false advertising, the soundness of banks, securities sales, standards of housing materials, flammable fabrics, and various business practices. The Magnuson-Moss Act (1973) sets minimum standards for product warranties, makes a company that financed the sale responsible for product defects, and creates liability (financial responsibility) for “implied” warranties (when the circumstances show that a warranty of lack of defects was intended) as well as express (specific) warranties. Mail fraud may include fake contests, “low-ball” price traps (bait and switch), supposed credit for referrals of your friends, phoney home improvement loans with huge final payments, and swamp land sales. Some states’ laws regulate and give some protection against high-pressure door-to-door sales, false labeling, unsolicited merchandise, abusive collection practices, misleading advertising and referral and promotional sales. Almost all states have agencies set up to actively protect the consumer.
Contempt of court
Behavior in or out of court that violates a court order, or otherwise disrupts or shows disregard for the court. Refusing to answer a proper question, to file court papers on time or to follow local court rules can expose witnesses, lawyers and litigants to contempt findings. Contempt of court is punishable by fine or imprisonment.
A provision in a contract stating that some or all of the terms of the contract will be altered or voided by the occurrence of a specific event. For example, a contingency in a contract for the purchase of a house might state that if the buyer does not approve the inspection report of the physical condition of the property, the buyer does not have to complete the purchase.
A method of paying a lawyer for legal representation by which, instead of an hourly or per job fee, the lawyer receives a percentage of the money her client obtains after settling or winning the case. Often contingency fee agreements — which are most commonly used in personal injury cases — award the successful lawyer between 20% and 50% of the amount recovered. Lawyers representing defendants charged with crimes may not charge contingency fees. In most states, contingency fee agreements must be in writing.
adj. possible, but not certain.
1) An alternate beneficiary named in a will, trust or other document. 2) Any person entitled to property under a will if one or more prior conditions are satisfied. For example, if Fred is entitled to take property under a will only if he’s married at the time of the will maker’s death, Fred is a contingent beneficiary. Similarly, if Ellen is named to receive a house only in the event her mother, who has been named to live in the house, moves out of it, Ellen is a contingent beneficiary.
n. an interest in real property which, according to the deed (or a will or trust), a party will receive only if a certain event occurs or certain circumstances happen. Examples: surviving a person who had a life estate (the right to use the property for his/her life), or having children at the time such a life estate ends.
The postponement of a hearing, trial or other scheduled court proceeding, at the request of one or both parties, or by the judge without consulting them. Unhappiness with long trial court delays has resulted in the adoption by most states of “fast track” rules that sharply limit the ability of judges to grant continuances.
n. an objection to certain questions or testimony during a trial which has been “overruled” by the judge, but the attorney who made the objection announces he/she is “continuing” the objection to all other questions on the same topic or with the same legal impropriety in the opinion of the attorney. Thus a “continuing” objection does not require an objection every time the same question or same subject is introduced.
Latin for “against” or “opposite to”. This usage is usually found in legal writing in statements.
A legally binding agreement involving two or more people or businesses (called parties) that sets forth what the parties will or will not do. Most contracts that can be carried out within one year can be either oral or written. Major exceptions include contracts involving the ownership of real estate and commercial contracts for goods worth $500 or more, which must be in writing to be enforceable. A contract is formed when competent parties — usually adults of sound mind or business entities — mutually agree to provide each other some benefit (called consideration), such as a promise to pay money in exchange for a promise to deliver specified goods or services or the actual delivery of those goods and services. A contract normally requires one party to make a reasonably detailed offer to do something — including, typically, the price, time for performance and other essential terms and conditions — and the other to accept without significant change. For example, if I offer to sell you ten roses for $5 to be delivered next Thursday and you say “It’s a deal,” we’ve made a valid contract. On the other hand, if one party fails to offer something of benefit to the other, there is no contract.
n. 1) a person or entity that enters into a contract. 2) commonly, a person or entity that agrees to construct a building or to provide or install specialized portions of the construction. The party responsible for the overall job is a “general contractor,” and those he/she/it hires to construct or install certain parts (electrical, plumbing, roofing, tile-laying, etc.) are “subcontractors,” who are responsible to the general contractor and not to the property owner. An owner must be sure that the subcontractors are paid by the general contractor by demanding and receiving proof of payment, or the subcontractor will be entitled to payment from the owner based on a mechanic’s lien against the property. 3) a person who performs services but is not an employee, often called an “independent contractor.”
n. 1) donation to a charity or political campaign. 2) the sharing of a loss by each of several persons who may have been jointly responsible for injury to a third party, who entered into a business which lost money or who owe a debt jointly. Quite often this arises when one responsible party pays more than his share and then demands contribution from the others in proportion to their share of the obligation.
n. a doctrine of common law that if a person was injured in part due to his/her own negligence (his/her negligence “contributed” to the accident), the injured party would not be entitled to collect any damages (money) from another party who supposedly caused the accident. Under this rule, a badly injured person who was only slightly negligent could not win in court against a very negligent defendant. The possible unfair results have led some juries to ignore the rule and, in the past few decades, most states have adopted a comparative negligence test in which the relative percentages of negligence by each person are used to determine damage recovery (how much money would be paid to the injured person).
1) n. the power to direct, manage, oversee and/or restrict the affairs, business or assets of a person or entity. 2) v. to exercise the power of control.
n. the laws of the state which will be relied upon in interpreting or judging disputes involving a contract, trust or other documents. Quite often an agreement will state as one of its provisions that the controlling law will be that of a particular state.
n. 1) disagreement, argument or quarrel. 2) a dispute, which must be an actual contested issue between parties in order to be heard by a court. The U.S. Supreme Court particularly requires an “actual controversy” and avoids giving “what if” advisory opinions.
v. to transfer title (official ownership) to real property (or an interest in real property) from one (grantor) to another (grantee) by a written deed (or an equivalent document such as a judgment of distribution which conveys real property from an estate). This is completed by recording the document with the County Recorder or Recorder of Deeds. It only applies to real property.
n. a generic term for any written document which transfers (conveys) real property or real property interests from one party to another. A conveyance must be acknowledged before a notary (or if a court judgment be certified as the same as the document on file) and recorded with the County Recorder or Recorder of Deeds.
A rule that allows you to cancel a contract within a specified time period (typically three days) after signing it. Federal cooling-off rules apply this three-day grace period to sales made door-to-door and anywhere other than a seller’s normal place of business, such as at a trade show. Another federal cooling-off rule lets you cancel a home improvement loan or second mortgage within three days of signing. Various states have cooling-off rules that sometimes apply even longer cancellation periods to specific types of sales, such as dancing lessons and timeshares.
n. an association of individual businesses, farmers, ranchers or manufacturers with similar interests, intending to cooperate in marketing, shipping and related activities (sometimes under a single brand name) to sell their products efficiently, and then share the profits based on the production, capital or effort of each. Cooperatives include dairy milk producers, cotton gins and thousands of other enterprises of all sizes. There are also cooperatives in which consumers form retail outlets like grocery stores and share the profits based on the amount of patronage of each member, but they have found it difficult to compete with the giant supermarket chains. Some cooperatives exist to operate housing complexes.
n. an arrangement in which an association or corporation owns a group of housing units and the common areas for the use of all the residents. The individual participants own a share in the cooperative which entitles them to occupy an apartment (or town house) as if they were owners, to have equal access to the common areas and to vote for members of the board of directors which manages the cooperative. A cooperative differs from a condominium project in that the owners of the condominium units actually own their airspace and a percentage interest in the common area. In a cooperative there are often restrictions on transfer of shares such as giving priority to other members, limits on income or maximum sales price.
Compulsory employment benefits provided by a state or federal government to ensure a minimum standard of living for lower and middle income people. Survivors benefits, disability benefits and health insurance are common examples. Also called social insurance.
For copyright purposes, the physical form in which an expression is reproduced and retained over time, no matter how brief. Copies include such things as photocopies, computer disks and tape recordings. The exclusive right to prepare copies of an original work is one of the primary rights protected by a copyright.
A legal device that provides the owner the right to control how a creative work is used. A copyright is comprised of a number of exclusive rights, including the right to make copies, authorize others to make copies, make derivative works, sell and market the work and perform the work. Any one of these rights can be sold separately through transfers of copyright ownership.
The © symbol, plus the date of publication and the author’s name. For works published in the U.S. after March 1, 1989, no copyright notice is required for copyright protection within the U.S. or any country that has signed the Berne Convention or GATT. A notice is still useful to remind others that the work is copyrighted, to steer a would-be user in the right direction to obtain permission to use the copyrighted material and to preclude a defense of “I didn’t know it was copyrighted” if someone uses the copyrighted material without permission.
A branch of the U.S. Library of Congress that oversees the implementation of the federal copyright laws, including issuing regulations and processing applications for the registration of copyrights.
Under the Copyright Act of 1976, a term with two meanings. First, it refers to the person or entity listed as the owner in the U.S. Copyright Office, usually the original author or developer. Second, it refers to a person or entity to which an exclusive part of the copyright has been transferred in writing. For instance, if Harry writes and copyrights a book, then sells the right to prepare a screenplay based on the book to a movie studio, both he and the studio are copyright owners.
Act required by the U.S. Copyright Office before a court action may be brought to prevent infringement. Copyright protection automatically attaches to any work of authorship as soon as it is fixed in a tangible medium of expression. Registration also confers strategic benefits in an infringement action, including a presumption that the registered owner is the rightful owner, as well as the ability to collect damages that often make the difference between an owner being able to afford litigation and having to forego his or her rights.
n. a county official with the responsibility to determine the cause of death of anyone who dies violently (by attack or accident), suddenly, or suspiciously. The coroner or one of his/her staff must examine the body at the scene of such a death and make a report. If the cause is not obvious or certified by an attending physician, then the coroner may order a “coroner’s inquest” which requires an autopsy (postmortem). If that is not conclusive, the coroner may hold a hearing as part of the inquest, although this is rare due to scientific advances in pathology.
n. a business opportunity which becomes known to a corporate official, particularly a director or other upper management, due to his/her position within the corporation. In essence, the opportunity or knowledge belongs to the corporation, and the officials owe a duty (a fiduciary duty) not to use that opportunity or knowledge for their own benefit. The corporation may have the right to damages (to be paid off) for such improper appropriation (use) of the opportunity on the theory that the official holds it in “constructive trust” for the corporation. The corporation may obtain an injunction (court order) to prevent someone’s use of the knowledge or opportunity.
A written document that describes an action taken by the board of directors of a corporation. For example, when a corporation issues a stock dividend, the declaration of the dividend is a corporate resolution.
A legal structure authorized by state law that allows a business to organize as a separate legal entity from its owners. A nonprofit is often referred to as an “artificial legal person,” meaning that, like an individual, it can enter into contracts, sue and be sued and do the many other things necessary to carry on a business. One advantage of incorporating is that a corporation’s owners (shareholders) are legally shielded from personal liability for the corporation’s liabilities and debts (unpaid taxes are often an exception). In theory, a corporation can be organized either for profit-making or nonprofit purposes. Most profit-making corporations are known as C corporations and are taxed separately from their owners, but those organized under subchapter S of the Internal Revenue Code are pass-through tax entities, meaning that all profits are federally taxed on the personal income tax returns of their owners
Latin for body.The principal (usually money, securities and other assets) of a trust or estate as distinguished from interest or profits.
Latin for the “body of the crime.” Used to describe physical evidence, such as the corpse of a murder victim or the charred frame of a torched building.
Latin the body of the law, meaning a compendium of all laws, cases and the varied interpretations of them. There are several encyclopedias of the law which fit this definition, the most famous of which is Corpus Juris Secundum. Several states have such series of books covering explanations of the law of that state.
v. to confirm and sometimes add substantiating (reinforcing) testimony to the testimony of another witness or a party in a trial.
n. evidence which strengthens, adds to, or confirms already existing evidence.
A person who signs his or her name to a loan agreement, lease or credit application. If the primary debtor does not pay, the cosigner is fully responsible for the loan or debt. Many people use cosigners to qualify for a loan or credit card. Landlords may require a cosigner when renting to a student or someone with a poor credit history.
n. a list of claimed court costs submitted by the prevailing (winning) party in a lawsuit after the judge states his/her judgment formally called a “memorandum of costs.” Statutes limit what can be included in these costs.
Cost of completion
n. the amount of money (damages) required to complete performance (finish the job) when a contract has been breached by the failure to perform. Example: when a general contractor breaches by not completing a house, the cost of completion is the actual cost of bringing in a new builder to finish what is left to do. The actual costs become the measure of damages rather than an estimate of cost based on percentage of work to be done.
1) n. a lawyer, attorney, attorney-at-law, counsellor, counsellor-at-law, solicitor, barrister, advocate or proctor (a lawyer in admiralty court), licensed to practice law. In the United States they all mean the same thing. 2) v. to give legal advice. 3) v. in some jurisdictions, to urge someone to commit a crime, which in itself is a crime.
n. a licensed attorney.
n. each separate statement in a complaint which states a cause of action which, standing alone, would give rise to a lawsuit, or each separate charge in a criminal action. For example, the complaint in a civil (non-criminal) lawsuit might state: First Count (or cause of action) for negligence, and then state the detailed allegations; Second Count for breach of contract; Third Count for debt and so forth. In a criminal case each count would be a statement of a different alleged crime. There are also so-called common counts which cover various types of debt.
A defendant’s court papers that seek to reverse the thrust of the lawsuit by claiming that it was the plaintiff — not the defendant — who committed legal wrongs, and that as a result it is the defendant who is entitled to money damages or other relief. Usually filed as part of the defendant’s answer — which also denies plaintiff’s claims — a counterclaim is commonly but not always based on the same events that form the basis of the plaintiff’s complaint. For example, a defendant in an auto accident lawsuit might file a counterclaim alleging that it was really the plaintiff who caused the accident. In some states, the counterclaim has been replaced by a similar legal pleading called a cross-complaint. In other states and in federal court, where counterclaims are still used, a defendant must file any counterclaim that stems from the same events covered by the plaintiff’s complaint or forever lose the right to do so. In still other states where counterclaims are used, they are not mandatory, meaning a defendant is free to raise a claim that it was really the plaintiff who was at fault either in a counterclaim or later as part of a separate lawsuit.
n. a retaliatory claim by a defendant against a plaintiff in a lawsuit included in the defendant’s answer and intending to off-set and/or reduce the amount of the plaintiff’s original claim against the defendant. In many states the counterclaim is no longer allowed, in which case a cross-complaint, which is a separate complaint, must be filed by the defendant, but as part of the same lawsuit. On the other hand, in federal cases, if the defendant believes he/she/it has a legitimate counterclaim to reduce damages it must be alleged (stated) in the answer or it is barred from being considered.
1) adj. describing a document, particularly money, which is forged or created to look real and intended to pass for real. 2) v. to criminally forge or print a false copy of money, bonds, or other valuable documents, intending to profit from the falsity. 3) n. shorthand for phoney money passed for real.
The rejection of an offer to buy or sell that simultaneously makes a different offer, changing the terms in some way. For example, if a buyer offers $5000 for a used car, and the seller replies that he wants $5500, the seller has rejected the buyer’s offer of $5000 and made a counteroffer to sell at $5500. The legal significance of a counteroffer is that it completely voids the original offer, so that if the seller decided to sell for $5000 the next day, the buyer would be under no legal obligation to pay that amount for the car.
n. in the law of contracts, a written paper which is one of several documents which constitute a contract, such as a written offer and a written acceptance. Often a contract is in several counterparts which are the same but each paper is signed by a different party, particularly if they are in different localities.
n. in the midst of or actively involved in at that time, as “in the course of business, course of employment, course of trade.”
Course of employment
adj. actively involved in a person’s employment at a particular time, most likely when an accident occurred, which is required to make a claim for work-related injury under state Worker’s Compensation Acts.
n. 1) the judge, as in “The court rules in favor of the plaintiff.” 2) any official tribunal (court) presided over by a judge or judges in which legal issues and claims are heard and determined. In the United States there are essentially two systems: federal courts and state courts. The basic federal court system has jurisdiction over cases involving federal statutes, constitutional questions, actions between citizens of different states, and certain other types of cases. Its trial courts are District Courts in one or more districts per state, over which there are District Courts of Appeal (usually three-judge panels) to hear appeals from judgments of the District Courts within the “circuit.” There are 10 geographic circuits throughout the nation. Appeals on constitutional questions and other significant cases are heard by the Supreme Court, but only if that court agrees to hear the case. There are also special federal courts such as bankruptcy and tax courts with appeals directed to the District Courts. Each state has local trial courts, which include courts for misdemeanors (non-penitentiary crimes), smaller demand civil actions (called municipal, city, justice or some other designation), and then courts, usually set up in each county (variously called Superior, District, County, Common Pleas courts and called Supreme Court in New York) to hear felonies (crimes punished by state prison terms), estates, divorces and major lawsuits. The highest state court is called the State Supreme Court, except in New York and Maryland, which call them Court of Appeals. Some 29 states have intermediate appeals courts which hear appeals from trial courts which will result in final decisions unless the State Supreme Court chooses to consider the matter. Some states have speciality courts such as family, surrogate and domestic relations. Small claims courts are an adjunct of the lowest courts handling lesser disputes (although California’s limit is $5,000) with no representation by attorneys and short and somewhat informal trials conducted by judges, commissioners or lawyers. The great number of law cases and lawyers’ procedural maneuvers has clogged courts’ calendars and has induced many states or local courts to set up mediation, arbitration, mandatory settlement conferences and other formats to encourage settlement or early judgments without the cost and wait of full court trials.
A list of the cases and hearings that will be held by a court on a particular day, week or month. Because the length of time it will take to conduct a particular hearing or trial is at best a guess and many courts have a number of judges, accurately scheduling cases is difficult, with the result that court calendars are often revised and cases are often heard later than initially planned. A court calendar is sometimes called a docket, trial schedule or trial list.
The fees charged for the use of a court, including the initial filing fee, fees for serving the summons, complaint and other court papers, fees to pay a court reporter to transcribe deposition and in-court testimony and, if a jury is involved, to pay the daily stipend of jurors. Often costs to photocopy court papers and exhibits are also included. Court costs must be paid by both parties as the case progresses, but ultimately, the losing party will be responsible for both parties’ costs.
Court of appeals
n. any court (state or federal) which hears appeals from judgments and rulings of trial courts or lower appeals courts.
Court of Customs and Patent Appeals
n. a federal court established (1929) to hear appeals from decisions by the U.S. Patent Office and from the U.S. Customs Court. It sits in Washington, D. C. and is composed of five judges.
Court of equity
n. originally in English common law and in several states there were separate courts (often called chancery courts) which handled lawsuits and petitions requesting remedies other than damages, such as writs, injunctions and specific performance. Gradually the courts of equity have merged with courts of law. Federal bankruptcy courts are the one example of courts which operate as courts of equity.
Court of law
n. any tribunal within a judicial system. Under English common law and in some states it was a court which heard only lawsuits in which damages were sought, as distinguished from a court of equity which could grant special remedies. That distinction has dissolved and every court (with the exception of federal bankruptcy courts) is a court of law.
a trial with a judge but no jury.
A restriction on the use of real estate that governs its use, such as a requirement that the property will be used only for residential purposes. Covenants are found in deeds or in documents that bind everyone who owns land in a particular development. See covenants, conditions and restrictions
Covenant not to compete
n. a common provision in a contract for sale of a business in which the seller agrees not to compete in the same business for a period of years or in the geographic area. This covenant is usually allocated (given) a value in the sales price.
Covenant that runs with the land
n. a promise contained in a deed to land or real estate which is binding upon the current owner and all future owners.
Covenants, conditions & restrictions (CC&Rs)
The restrictions governing the use of real estate, usually enforced by a homeowners’ association and passed on to the new owners of property. For example, CC&Rs may tell you how big your house can be, how you must landscape your yard or whether you can have pets. If property is subject to CC&Rs, buyers must be notified before the sale takes place.
n. whether testimony is worthy of belief, based on competence of the witness and likelihood that it is true. Unless the testimony is contrary to other known facts or is extremely unlikely based on human experience, the test of credibility is purely subjective.
n. a witness whose testimony is more than likely to be true based on his/her experience, knowledge, training and appearance of honesty and forthrightness, as well as common human experience. This is subjective in that the trier of fact (judge or jury) may be influenced by the demeanor of the witness or other factors.
A private, profit-making company that collects and sells information about a person’s credit history. Typical clients include banks, mortgage lenders and credit card companies that use the information to screen applicants for loans and credit cards. There are three major credit bureaus, Equifax, Experian and Trans Union, and they are regulated by the federal Fair Credit Reporting Act.
Counseling that explores the possibility of repaying debts outside of bankruptcy and educates the debtor about credit, budgeting, and financial management. Under the new bankruptcy law, a debtor must undergo credit counseling with an approved provider before filing for bankruptcy.
Insurance a lender requires a borrower to purchase to cover the loan. If the borrower dies or becomes disabled before paying off the loan, the policy will pay off the remaining balance. Federal and state consumer protection laws require the lender to disclose to existing and potential borrowers the terms and costs of obtaining credit insurance because it can affect the terms of the loan.
An account of your credit history, prepared by a credit bureau. A credit report will contain both credit history, such as what you owe to whom and whether you make the payments on time, as well as personal history, such as your former addresses, employment record and lawsuits in which you have been involved. An estimated 50% of all credit reports contain errors, such as accounts that don’t belong to you, an incorrect account status or information reported that is older than seven years (ten years in the case of a bankruptcy).
A person or entity (such as a bank) to whom a debt is owed.
n. a claim required to be filed in writing, in a proper form by a person or entity owed money by a debtor who has filed a petition in bankruptcy court (or had a petition filed to declare the debtor bankrupt), or is owed money by a person who has died. Notice of the need to file a creditor’s claim in the estate of a person who has died must be printed in a legal advertisement giving notice of death. Then a creditor has only a few months to file the claim, and it must be in a form approved by the courts.
n. the field of law dealing with the legal means and procedures to collect debts and judgments.
A type of behavior that is has been defined by the state, as deserving of punishment which usually includes imprisonment. Crimes and their punishments are defined by Congress and state legislatures.
1) n. a popular term for anyone who has committed a crime, whether convicted of the offense or not. More properly it should apply only to those actually convicted of a crime. Repeat offenders are sometimes called habitual criminals. 2) adj. describing certain acts or people involved in or relating to a crime. Examples of uses include “criminal taking,” “criminal conspiracy,” a “criminal gang.”
A lawsuit brought by a prosecutor employed by the federal, state or local government that charges a person with the commission of a crime.
Laws written by Congress and state legislators that make certain behavior illegal and punishable by fines and/or imprisonment. By contrast, civil laws are not punishable by imprisonment. In order to be found guilty of a criminal law, the prosecution must show that the defendant intended to act as he did; in civil law, you may sometimes be responsible for your actions even though you did not intend the consequences. For example, civil law makes you financially responsible for a car accident you caused but didn’t intend.
Sometimes called a cross-claim, legal paperwork that a defendant files to initiate her own lawsuit against the original plaintiff, a co-defendant or someone who is not yet a party to the lawsuit. A cross-complaint must concern the same events that gave rise to the original lawsuit. For example, a defendant accused of causing an injury when she failed to stop at a red light might cross-complain against the mechanic who recently repaired her car, claiming that his negligence resulted in the brakes failing and, hence, that the accident was his fault. In some states where the defendant wishes to make a legal claim against the original plaintiff and no third party is claimed to be involved, a counterclaim, not a cross-complaint, should be used.
At trial, the opportunity to question any witness, including your opponent, who testifies against you on direct examination. The opportunity to cross-examine usually occurs as soon as a witness completes her direct testimony — often the opposing lawyer or party, or sometimes the judge, signals that it is time to begin cross-examination by saying, “Your witness.” Typically, there are two important reasons to engage in cross-examination: to attempt to get the witness to say something helpful to your side, or to cast doubt on (impeach) the witness by getting her to admit something that reduces her credibility — for example, that her eyesight is so poor that she may not have seen an event clearly.
Businesses’ sharing of patent rights through licensing agreements so that they can use each other’s inventions.
Any act of inflicting unnecessary emotional or physical pain. Cruelty or mental cruelty is the most frequently used fault ground for divorce because as a practical matter, courts will accept minor wrongs or disagreements as sufficient evidence of cruelty to justify the divorce.
adj. sufficiently responsible for criminal acts or negligence to be at fault and liable for the conduct. Sometimes culpability rests on whether the person realized the wrongful nature of his/her actions and thus should take the blame.
n. an attorney employed by a defendant in a lawsuit when there is an insurance policy supposedly covering the claim, but there is a conflict of interest between the insurance company and the insured defendant. Such a conflict might arise if the insurance company is denying full coverage. In some states (notably California) the defendant can demand that the insurance company pay the fees of his/her own attorney rather than use an insurance company lawyer. Often the insurance company will require that the attorney for the defendant be approved by the company.
n. in corporations, a system of voting by shareholders for directors in which the shareholder can multiply his voting shares by the number of candidates and vote them all for one person for director. This is intended to give minority shareholders a chance to elect at least one director whom they favor.
Current monthly income
As defined by the new bankruptcy law, a bankruptcy filer’s total gross income (whether taxable or not), averaged over the six-month period immediately preceding the bankruptcy filing. The debtor’s current monthly income is used to determine whether the debtor can file for Chapter 7 bankruptcy, among other things.
n. in old common law, the right of a surviving husband to a life estate in the lands of his deceased wife, if they had a surviv- ing child or children who would inherit the land. A few states still recognize this charming anachronism.
The taking of a child from his or her parent with the intent to interfere with that parent’s physical custody of the child. This is a crime in most states, even if the taker also has custody rights.
n. 1) holding property under one’s control. 2) law enforcement officials’ act of holding an accused or convicted person in criminal proceedings, beginning with the arrest of that person. 3) in domestic relations (divorce, dissolution) a court’s determination of which parent (or other appropriate party) should have physical and/or legal control and responsibility for a minor child.
Cy pres doctrine
n. (see-pray doctrine) from French, meaning “as close as possible.” When a gift is made by will or trust (usually for charitable or educational purposes), and the named recipient of the gift does not exist, has dissolved or no longer conducts the activity for which the gift is made, then the estate or trustee must make the gift to an organization which comes closest to fulfilling the purpose of the gift. Sometimes this results in heated court disputes in which a judge must determine the appropriate substitute to receive the gift. Example: dozens of local Societies for Protection of Cruelty to Animals contested for a gift which was made without designating which chapter would receive the benefits. The judge wisely divided up the money among several S.P.C.A. chapters.
Buying a domain name that reflects the name of a business or famous person with the intent of selling the name back to the business or celebrity for a profit. The Anticybersquatting Consumer Protection Act of 1999 authorizes a cybersquatting victim to file a federal lawsuit to regain a domain name or sue for financial compensation. Under the act, registering, selling or using a domain name with the intent to profit from someone else’s good name is considered cybersquatting. Victims of cybersquatting can also use the provisions of the Uniform Domain Name Dispute Resolution Policy adopted by ICANN, an international tribunal administering domain names. This international policy results in arbitration of the dispute, not litigation.