BUSINESS LAW TEXT AND CASES KENNETH
CLARKSON CERTIFICATION EVALUATION 2026
TEST PAPER QUESTIONS AND SOLUTIONS
100% CORRECT
◉ American Arbitration Association (AAA). Answer: The major
organization offering arbitration services in the United States.
◉ Arbitration. Answer: The settling of a dispute by submitting it to a
disinterested third party (other than a court), who renders a
decision. The decision may or may not be legally binding.42
◉ Arbitration clause. Answer: A clause in a contract that provides
that, in the event of a dispute, the parties will submit the dispute to
arbitration rather than litigate the dispute in court.
◉ Award. Answer: In the context of litigation, the amount of money
awarded to a plaintiff in a civil lawsuit as damages. In the context of
arbitration, the arbitrator's decision.
◉ Bankruptcy court. Answer: A federal court of limited jurisdiction
that handles only bankruptcy proceedings. Bankruptcy proceedings
are governed by federal bankruptcy law.
, ◉ Concurrent jurisdiction. Answer: Jurisdiction that exists when two
different courts have the power to hear a case. For example, some
cases can be heard in either a federal or a state court.
◉ Diversity of citizenship. Answer: Under Article III, Section 2, of the
Constitution, a basis for federal court jurisdiction over a lawsuit
between (1) citizens of different states, (2) a foreign country and
citizens of a state or of different states, or (3) citizens of a state and
citizens or subjects of a foreign country. The amount in controversy
must be more than $75,000 before a federal court can take
jurisdiction in such cases.
◉ Early neutral case evaluation. Answer: A form of alternative
dispute resolution in which a neutral third party evaluates the
strengths and weakness of the disputing parties' positions; the
evaluator's opinion forms the basis for negotiating a settlement.
◉ Exclusive jurisdiction. Answer: Jurisdiction that exists when a case
can be heard only in a particular court or type of court, such as a
federal court or a state court.
◉ Federal question. Answer: A question that pertains to the U.S.
Constitution, acts of Congress, or treaties. A federal question
provides a basis for federal jurisdiction.
CLARKSON CERTIFICATION EVALUATION 2026
TEST PAPER QUESTIONS AND SOLUTIONS
100% CORRECT
◉ American Arbitration Association (AAA). Answer: The major
organization offering arbitration services in the United States.
◉ Arbitration. Answer: The settling of a dispute by submitting it to a
disinterested third party (other than a court), who renders a
decision. The decision may or may not be legally binding.42
◉ Arbitration clause. Answer: A clause in a contract that provides
that, in the event of a dispute, the parties will submit the dispute to
arbitration rather than litigate the dispute in court.
◉ Award. Answer: In the context of litigation, the amount of money
awarded to a plaintiff in a civil lawsuit as damages. In the context of
arbitration, the arbitrator's decision.
◉ Bankruptcy court. Answer: A federal court of limited jurisdiction
that handles only bankruptcy proceedings. Bankruptcy proceedings
are governed by federal bankruptcy law.
, ◉ Concurrent jurisdiction. Answer: Jurisdiction that exists when two
different courts have the power to hear a case. For example, some
cases can be heard in either a federal or a state court.
◉ Diversity of citizenship. Answer: Under Article III, Section 2, of the
Constitution, a basis for federal court jurisdiction over a lawsuit
between (1) citizens of different states, (2) a foreign country and
citizens of a state or of different states, or (3) citizens of a state and
citizens or subjects of a foreign country. The amount in controversy
must be more than $75,000 before a federal court can take
jurisdiction in such cases.
◉ Early neutral case evaluation. Answer: A form of alternative
dispute resolution in which a neutral third party evaluates the
strengths and weakness of the disputing parties' positions; the
evaluator's opinion forms the basis for negotiating a settlement.
◉ Exclusive jurisdiction. Answer: Jurisdiction that exists when a case
can be heard only in a particular court or type of court, such as a
federal court or a state court.
◉ Federal question. Answer: A question that pertains to the U.S.
Constitution, acts of Congress, or treaties. A federal question
provides a basis for federal jurisdiction.
