Question

Assume GC advertises aggressively in the Middle Atlantic States of Maryland, Delaware, Pennsylvania, West Virginia and Virginia. GC also advertises regularly via the internet soliciting business in all states.

Assume GC contracted with ABC Corporation (ABC), incorporated in Pennsylvania, to clean the company offices in Philadelphia. ABC paid for the cleaning, but after the cleaning, ABC was dissatisfied and sued GC in Pennsylvania to recover the costs of the cleaning. It was determined that the Pennsylvania state court had jurisdiction to hear the case.

1. Applying the concepts of jurisdiction to the scenario facts, discuss whether you believe it is fair for the Pennsylvania courts to have jurisdiction to hear the case, and why.

Fully support your conclusions.  Respond in 1 -2 paragraphs.

2. Analyze the scenario facts and discuss whether you believe it would be more appropriate to settle the dispute via mediation, rather than in a court trial, and why.

Fully support your conclusions.  Respond in 1 -2 paragraphs.

Answer 1

1. According to the Concept of Jurisdiction, GC has "minimal contact" with ABC, which is incorporated in Pennsylvania as GC advertises regularly through the internet in the Middle Atlantic States of Maryland, Delaware, Pennsylvania, West Virginia, and Virginia soliciting business in all states. So I believe it's fair that the State of Pennsylvania has the Jurisdiction to hear the case in Magisterial District Courts (if the amount is less than $12000) as both the defendant solicited its business and the plaintiff's office is incorporated in Pennsylvania. So it can be determined that the plaintiff responded to an ad in Pennsylvania by the defendant, to use defendant's services in Philadelphia, So Pennsylvania has both "subject-matter" and "Minimal Contact" jurisdiction.

2. I believe it would be more appropriate to settle the dispute via mediation, rather than in a court trial because according to the concept of Jurisdiction for small claims, the Plaintiff is recommended to send a certified letter to the defendant seeking the claim and should also send an intimation of filing a lawsuit in the Magisterial District or Small Claims Court if the claim is not paid within a said deadline. This gives them a chance to be compliant and is also one of the quickest and cheapest ways to recover money. More often business is successfully run on their goodwill, no company would want to smear their reputation by getting embroiled in a lawsuit, even though civil. So there are high chances that either GC will refund the cost amount or give their services again at no cost to ABC through mediation. But once dragged in a lawsuit, GC will not leave any stone unturned to lose the lawsuit, which will cost more than it will recover.