Introductory Business Law CLEP Prep Practice Exam

Without a provision concerning forum selection, parties to a contract must dispute matters in what court?

1. State Appellate Court

2. Federal District Court

3. Any Court mutually Agreed To

4. The Court of the State Where the Contract Was Entered Into

The correct answer is: The Court of the State Where the Contract Was Entered Into

Without a provision concerning forum selection, parties to a contract must dispute matters in the court of the state where the contract was entered into. This means that if no specific court is mentioned in the contract, the parties are required to bring their dispute to the court in the state where the contract was formed. Option A, the state appellate court, may be an incorrect option because appellate courts generally do not handle initial disputes, but rather review decisions made by lower courts. Option B, the federal district court, may also be an incorrect option because federal courts typically only have jurisdiction over certain types of cases, such as those involving federal laws or disputes between citizens of different states. Option C, any court mutually agreed to, may be incorrect as it assumes that the parties have already chosen a specific court to handle their disputes. If no mutual agreement has been reached, then the parties are required to bring