Gale Encyclopedia Of American Law 3Rd Edition Volume 4 P30 doc

Objection Legal Basis Calls for speculation Questions that ask the witness to guess or speculate are improper. Is compound The question brings up two or more separate facts, and any simple answer would be unclear. Is argumentative The question is essentially an argument to the judge or jury; it elicits no new information but rather states a conclusion and asks the witness to agree with it. Is an improper characterization For example, the question calls the defendant a spoiled brat, greedy pig, or frenzied dog; characterization is something the jury or judge, not a witness or attorney, should infer. Mistakes evidence (or misquotes the witness) Misstating or distorting evidence, or misquoting a witness, is improper. Is cumulative When numerous witnesses testify to the same facts or numerous exhibits demonstrate the same things, without adding anything new, the evidence is objectionable. Constitutes an improper impeachment Rules surrounding the impeachment of a person’s character or credibility are highly technical. For example, evidence of a prior inconsistent statement made by a witness may be used only if the statement is materially inconsistent and is offered in the proper context. Violates the parol evidence rule The parol evidence rule bars evidence of oral, or verbal, modifications or contradictions of a written contract that is complete and clear on its face. Is unresponsive (or volunteered) An answer that does not directly respond to a question is objectionable as unresponsive; an answer that goes beyond what is necessary to answer the question is objectionable as volunteered. Only the attorney who called the witness may object on these grounds. Objections to Answers Is irrelevant Is immaterial Is privileged Is a conclusion Is improper opinion Is hearsay Is narrative Is improper characterization Objections to Exhibits Lacks proper foundation (or lacks foundation, or has no foundation) Before exhibits can be admitted into evidence, attorneys must establish the necessary foundation, or the facts that indicate the exhibit is what it purports to be. For a photograph of a crime scene, this might include calling the person who took the picture as a witness and asking whether she was at the crime scene, had a camera, and took a picture, and whether the exhibit is that picture. Lacks authentication Writings and conversations must be authenticated, or shown to have been executed by a party or that party’s agent. For example, before testifying about a telephone conversation, a witness must demonstrate his knowledge of who was speaking on the other end of the telephone. B GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EVIDENCE 279 with the inability to get the information via alternative means. Past Bad Acts Generally, evidence of past bad acts by a criminal defendant is not admissible to prove that the defendant is a bad person and, therefore, committed the crime charged. How- ever, evidence of past bad acts will be admitted for other purposes such as to show motive, intent, preparation, plan, knowledge, identity, or absence of a mistake or accident. Such evidence is also admissible for IMPEACHMENT purposes (for example, if a defendant takes the stand) and when a defendant seeks to introduce the evidence in his or her defense. In Ohler v. United States, 529 U.S. 753, 120 S. Ct. 1851, 146 L. Ed. 2d 826 (U.S.Cal., May 22, 2000) (No. 98-9828), the defendant Ohler was tried for importation of marijuana and posses- sion of marijuana with the intent to distribute. After the trial court granted the government’ s motion to admit evidence of her previous conviction for methamphetamine possession, as impeachment ev idence under Federal Rule of Evidence 609(a)(1), Ohler decided to bring out her prior conviction under direct examination, in order to “remove the sting” from the prosecutor’s possible elicitation of the convic- tion on cross-examination. (Under the tri al court’s ruling, the prior conviction was only admissible in the event that Ohler testified.) The jury convicted Ohler on both counts, and she appealed, claiming that the trial court erred in admitting her prior conviction. The U.S. Court of Appeals for the Ninth Circuit and the United States Supreme Court affirmed her conviction, holding that Ohler had waived her objection to the evidence by introducing it herself. FURTHER READINGS Gillmor, Barron, and Terry Simon. 1990. Mass Communi- cation Law Cases and Comment, 5th ed. St. Paul, MN: West. Nonevidentiary Objections Attorneys may also object to situations that arise during a trial or hearing that do not concern matters of evidence. During voir dire, or jury s election, attorneys may not argue to prospective jurors the law or the facts t hat will arise at tri al; if they do, they will likely receive an objection from opposing counsel. Likewise, attorneys often object to argu- ments made during opening statements, because opening statements are limited to a discussion of the evi dence that will be presented during the trial. An attorney’s personal opinion on any evidentiary matter is also objectionable because it places the attorney’s credibility directly at issue. And a personal attack by an attorney against a party, witness, or opposing counsel is unprofes- sional and will almost always re sult in a sustainable objection. FURTHER READING Park, Roger C. 2001. Trial Objections Handbook. 2d ed. St. Paul, Minn.: West Group. Is prejudicial The exhibit’s prejudicial effect outweighs its probative value. This objection is often raised with photo exhibits. A color photo of a murder victim may so prejudice the jury, without adding information helpful to determining the murderer, that the judge may disallow the photo as evidence. Contains inadmissible matter Exhibits in the forms of charts, diagrams, and maps must not disclose otherwise inadmissible material to the jury. For example, in most jurisdictions, evidence that a defendant in a personal injury case has insurance that may pay for the plaintiff’s damages is inadmissible. A chart, shown to the jury, that conveys the name of the defendant’s insurance company is improper and objectionable. Is irrelevant Is immaterial Contains hearsay B GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 280 EVIDENCE Leonard, David P. 1995. “Foreword: Twenty Years of the Federal Rules of Evidence.” Loyola of Los Angeles Law Review 28 (June). Mauet, Thomas A. 1988. Fundamentals of Trial Techniques. 2d ed. Boston: Little, Brown. McCormick on Evidence. 1984 and Supp. 1987. 3d ed. St. Paul, MN: West. Rothstein, Paul F., and Myrna S. Raeder. 2007. Evidence in a Nutshell. 5th ed. St. Paul, MN: West. CROSS REFERENCES Attorney-Client Privilege; Best Evidence; Character Evi- dence; Circumstantial Evidence ; Cumulative Evidence; Derivative Evidence; Direct Evidence; DNA Evidence; Documentary Evidence; Exclusionary Rule; Extrinsic Evi- dence; Forensic Science; Parole Evidence; Privileged Com- munication; Polygraph. EX DIVIDEND A phrase used by stockbrokers that denotes that a stock is sold without the purchaser receiving the right to own its recently declared dividend which has not yet been paid to the stockholders. The seller of a stock sold ex dividend retains the right to receive payment of the declared dividend. The purchaser of such a stock usually buys it at a price that is reduced by the amount of the dividend to be paid to the seller. EX OFFICIO [ Latin, From office. ] By virtue of the character- istics inherent in the holding of a particular office without the need of specific authorization or appointment. The phrase ex officio refer s to powers that,whilenotexpresslyconferreduponanofficial, are necessarily implie d i n t he office. A judge has ex officio powers of a CONSERVATOR OF THE PEACE. EX PARTE [ Latin, On one side only. ] Done by, for, or on the application of one party alone. An ex parte judicial proceeding is conducted for the benefit of only one party. Ex parte may also describe contact with a person represented by an attorney, outside the presence of the attorney. The term ex parte is used in a case name to signify that the suit was brought by the person whose name follows the term. Under the FIFTH AMENDMENT to the U.S. Constitution, “No person shall … be deprived of life, liberty, or property, without due process of law.” A bedrock feature of due process is fair notice to parties who may be affected by LEGAL PROCEEDINGS . An ex parte judicial proceeding, conducted without notice to, and outside the presence of, affected parties, would appear to violate the Constitution. However, adequate notice of judicial proceedings to concerned parties may at times work irreparable harm to one or more of those parties. In such a case, the threatened party or parties may receive an ex parte court hearing to request temporary judicial relief without notice to, and outside the presence of, other persons affected by the hearing. Ex parte judicial proceedings are usually reserved for urgent matters where requiring notice would subject one party to irreparable harm. For example, a person suffering abuse at the hands of a spouse or significant other may seek ex parte a TEMPORARY RESTRAINING ORDER from a court, directing the alleged abuser to stay away from him or her. Ex parte judicial proceedings are also used to stop IRREPARABLE INJURY to property. For example, if two neigh- bors, Reggie and Veronica, disagree over whose property a tree stands on, and Reggie wants to cut down the tree whereas Veronica wants to save it, Veronica can seek an ex parte hearing before a judge. At the hearing, she will ask the judge for a temporary RESTRAINING ORDER pre- venting Reggie from felling the tree. She will have to show the judge that she had no reasonable opportunity to provide Reggie with formal notice of the hearing, and that she might win the case. The court will then balance the potential hard- ships to Reggie and Veronica, in considering whether to grant Veronica’s request. A court order from an ex parte hearing is swiftly followed by a full hearing between the interested parties to the dispute. State and federal legislatures maintain laws allowing ex parte proceedings because such hearings balance the right to notice against the right to use the legal system to avert imminent and irreparable harm. Far from violating the Constitution, the ex parte proceeding is a lasting illustration of the elasticity of due process. Ex parte contact occurs when an attorney communicates with another party outside the presence of that party’s attorney. Ex parte contact also describes a judge who communicates with one party to a lawsuit to the exclusion of the other party or parties, or a judge who initiates discussions about a case with disinterested third parties. Canon 3(A)(4) of the AMERICAN BAR ASSOCIATION (ABA) Model CODE OF JUDICIAL GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EX PARTE 281 CONDUCT discourages judges from such ex parte communications. Under rule 4.2 of the ABA Model Rules of PROFESSIONAL RESPONSIBILITY,a lawyer should refrain from contacting a party who the lawyer knows is represented by another attorney, unless the lawyer has the consent of the other attorney or is authorized by law to do so. In a case name, ex parte signifies that the suit was initiated by the person whose name follows the term. For example, Ex parte Williams means that the case was brought on Williams’srequest alone. Many jurisdictions have abandoned ex parte in case names, preferring English over Latin terms (e.g., Application of Williams or Petition of Williams). In some jurisdictions, ex parte has been replaced by in re, which means “in the matter of” (e.g., In re Williams). However, most jurisdictions reserve the term in re for proceed- ings concerning property. FURTHER READINGS Campagna, Larry A. 2001. “Some Observations on Estab- lishing Independence: The Prohibition of Ex Parte Communications by Appeals Officers.” Chicago, IL: American Bar Association Section of Taxation. Flowers, Roberta K. 2000. “An Unholy Alliance: The Ex Parte Relationship between the Judge and the Prosecu- tor.” Nebraska Law Review 79 (spring). Gottlieb, Henry. 1995. “ABA Limits Ex-Parte Contacts; N.J. Lawyer Dissents.” New Jersey Law Journal (September 4). Harhut, C.T. 1995. “Ex Parte Communication Initiated by a Presiding Judge.” Temple Law Review 68. EX POST FACTO LAWS [ Latin, “After-the-fact” laws. ] Laws that provide for the infliction of punishment upon a person for some prior act that, at the time it was committed, was not illegal. Ex post f acto laws r etroactively change the rules of e vidence in a crimi nal case, retroactively alter t he definition of a crime, r etroactively increase the punishment f or a criminal act, or punish conduct that was legal w hen committed. They are p rohibited b y Article I, Section 10, Clause 1, of the U.S. Constitution. An ex post facto law is considered a h allmark o f t yranny because it deprives people of a s ense of what behavior will or will not be punished and allows for random punishment at the whim of those in power. The prohibition of ex post facto laws was an imperative in colonial America. The Framers of the Constitution understood the importance of such a prohibition, considering the historical tendency of government leaders to abuse power. As ALEXANDER HAMILTON observed, “[I]t is easy for men … to be zealous advocates for the rights of the citizens when they are invaded by others, and as soon as they have it in their power, to become the invaders themselves.” The desire to thwart abuses of power also inspired the Framers of the Constitution to prohibit bills of attainder, which are laws that inflict punish- ment on named individuals or on easily ascertainable members of a group without the benefit of a trial. Both ex post facto laws and bills of attainder deprive those subject to them of due process of law—that is, of notice and an opportunity to be heard before being deprived of life, liberty, or property. The Constitution did not provide a defini- tion for ex post facto laws, so the courts have been forced to attach meaning to the concept. In Calder v. Bull, 3 U.S. (3 Dall.) 386, 1 L. Ed. 648 (1798), the U.S. Supreme Court provided a first and lasting interpretation of the Ex Post Facto Clause. The focus of the Calder case was a May 1795 RESOLUTION of the Connecticut legislature that specifically set aside a March 1793 probate court decree. The resolution allowed the defeated party in the probate contest a new hearing on the matter of the will. The Court in Calder ruled that the Connecticut resolution did not constitute an ex post facto l aw because it did not affect a vested property right. In other words, no one had complete ownership of the property in the will, so depriving persons of the property did not violate the ex post facto clause. The Court went on to list situations that it believed the clause did address. It opined that an ex post facto law was one that rendered new or additional criminal punishment for a prior act or changed the rules of evidence in a criminal case. In Calder, the Court’s emphasis on criminal laws seemed to exclude civil laws from a definition of ex post facto— that is, it implied that if a statute did not inflict criminal punishment, it did not violate the Ex Pos t Facto Clause. Twelve years later, the U.S. Supreme Court held that a civil statute that revoked land grants to purchasers violated the Ex Post Fac to Clause ( FLETCHER V. PECK, 10 U.S. (6 Cranch) 87, 3 L. Ed. 162 [1810]). However, in 1854, faced with another opportunity to define ex post facto, the Court retreated from Fletcher and limited the prohibition to retroactively applied criminal laws ( Carpenter v. Pennsylvania, 58 U.S. (17 How.) 456, 15 L. Ed. 127 [1854]). GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 282 EX POST FACTO LAWS In Carpenter, the Court noted that the esteemed legal theorist SIR WILLIAM BLACKSTONE (1723–80) had described ex post facto in criminal terms. According to Blackstone, an ex post facto law has been created when, “after an action (indifferent in itself) is committed, the legislature then for the first time declares it to have been a crime, and inflicts punishment upon the person who has committed it.” Using this as the understanding of ex post facto in 1789, the Court reasoned that it must have been the Framers’ intent to limit the clause to criminal laws. However, notes from the Consti- tutional Convention indicate that the clause should cover the retroactive application of all laws, including civil laws. The only exception for ex post facto laws discussed at the Constitutional Convention was in case of “necessity and public safety” (Farrand, 1937). Since the Carpenter ruling, the Supreme Court has struck down some retroactive civil laws, but only those intended to have a punitive intent. This construction of the Ex Post Facto Clause has done little more than raise another question: What is punitive intent? The answer lies, invariably, with the U.S . Supreme Court. Court members have agreed unanimously on ex post facto arguments, but it have also split over the issue. In California Department of Corrections v. Morales, 514 U.S. 499, 115 S. Ct. 1597, 131 L. Ed. 2d 588 (1995), Jose Ramon Morales challenged a 1981 amendment (Cal. Penal Code Ann. SEC. 3041 [West 1982]) to California’s parole statute that allowed the California Board of Prison Terms to defer for three years the parole hearings of multiple murderers (1977 Cal. Stats. ch. 165, sec. 46). Before the amendment, California law stated that a prisoner eligible for parole was entitled to a parole hearing every year. Morales had two convictions for MURDER,his second conviction coming in 1980, one year before passage of the amendment. In 1989 the board denied parole to Morales and scheduled Morales’snexthearingfor1992. Morales filed suit, arguing that the amendment was retroactive punishment and therefore uncon- stitutional. The district court disagreed. However, on appeal, the U.S. Court of Appeals for the Ninth Circuit reversed that decision, holding that the law effectivelyincreased punishment for Morales, thus offending the Ex Post Facto Clause. By a vote of 7 to 2, the U.S. Supreme Court reversed the Ninth Circuit. Justice CLARENCE THOMAS , writing for the majority, noted that the law only “introduced the possibility” that a convict would receive fewer parole hearings and serve more pri son time than he or she expected. The board was required to formally find “no reasonable probability … for parole in the interim period” before it could defer a parole hearing for three years. According to the majority in Morales, the evident focus of the California law was “‘to relieve the [board] from the costly and time consuming responsibility of scheduling parole hearings’” (quoting In re Jackson, 39 Cal. 3d at 473, 216 Cal. Rptr. at 765, 703 P.2d at 106 [quoting legislative history]). The majority noted further that any assertion that the law might actually increase incarceration for those affected by it was largely “speculative.” Justices JOHN PAUL STEVENS and DAVID H. SOUTER dissented. The dissent warned of legislative over- reaching, arguing that “the concerns that animate the Ex Post Facto Clause demand enhanced, and not (as the majority seems to believe) reduced, judicial scrutiny.” To Stevens and Souter, the majority’s own opinion was speculative, and “not only unpersuasive, but actually perverse.” The Supreme Court has continued to be divided on issues related to this clause. In Carmell v. Texas, 529 U.S. 513, 120 S. Ct. 1620, 146 L. Ed. 2d 577 (2000), the Court ruled, in a 5 to 4 decision, that several criminal convictions of a sex offender could not stand because the state of Texas had changed the rules of evidence after he had committed the offenses. The DEFENDANT, Scott Carmell, was sentenced to life in prison for 15 counts involving various sexual offenses against his stepdaughter. The victim was 12 to 16 years old during the period that the offenses occurred. In 1993, the Texas Legislature changed its rules of evidence so that a person could be convicted based only on the testimony of the victim if the victim was less than 18 years old at the time of the offense. The previous age limit in Texas for a victim was 14 years old. Carmell challenged the convictions for offenses that occurred when the victim was older than fourteen, but younger than eighteen, because the change in the rules of evidence amounted to an ex post facto law. The Supreme Court, per Justice John Paul Stevens, agreed with the defendant. According to the majority, “laws that lower the BURDEN OF PROOF and laws that reduce the quantum of evidence necessary GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EX POST FACTO LAWS 283 to meet the burden are indistinguishable in all meaningful ways relevant to the concerns of the Ex Post Facto Clause.” The following year, the Court again consid- ered the application of the clause in Rogers v. Tennessee, 532 U.S. 451, 121 S. Ct. 1693, 149 L. Ed. 2d 697 (2001). The Court examined the relation of the clause to the Fourteenth Amendment’s Due Process Clause and to common law rules. It ruled that the clause did not apply to a state supreme court decision that abolished a common law rule dating back to medieval England. The debate over ex post facto interpretation continues. Critics of contemporary ex post facto interpretation argue that legislatures circumvent the ex post facto prohibition by casting i n civil terms laws that provide additional punishment for convicted criminals. For example, they have passed laws that require certain convicted sex offenders to register with local authorities and thus make public their continued presence in a community. By virtue of the VIOLENT CRIME CONTROL AND LAW ENFORCEMENT ACT OF 1994 (42 U.S.C.A. § 14071(a)(1)(A)), such laws are required of states that wish to receive certain anti-drug funds. Sex offender registration laws, or commu- nity notification laws, do not provide for retroactive additional incarceration. They do, however, provide additional consequences for a sex offender who was not, at the time the offense was committed, subject to such a constraint. Courts have held that such laws do not run afoul of the Ex Post Facto Clause, because, in part, the requirement is defined as civil regulation; that is, the law does not require extra prison time or exact an excessive fine. Also, such statutes are enacted for the protec- tion of the public, w hich is an exception to ex post facto prohibition. Dissenters maintain that sex offender registration laws inflict additional punishment and therefore violate the Ex Post Facto Clause. Only one state, Alaska, has found such a law unconstitutional (Rowe v. Burton, 884 F. Supp. 1372 [D. Alaska 1994]). The line between punitive measure and civil regulation can be thin. So long as legislatures pass laws that provide extra punishment for, or regulation of, conduct already committed, there will be arguments that the government is abusing its power in violation of the Ex Post Facto Clause. FURTHER READINGS Aiken, Jane Harris. 1992. “Ex Post Facto in the Civil Context: Unbridled Punishment.” Kentucky Law Journal 81. Blackstone, William. 1765. Commentaries on the Laws of England. Reprint, 2003. Clark, NJ: Lawbook Exchange. Booth, Michael. 1995. “State, U.S. Rift Leaves Megan’s Law Fate Unclear.” New Jersey Law Journal (July 31). Ferranti, William P. 2003. “Revised Sentencing Guidelines and the Ex Post Facto Clause.” Univ. of Chicago Law Review 70 (summer). Available online at http://www. allbusiness.com/legal/984733-1.html; website home page: http://www.allbusiness.com (accessed July 22, 2009). Lilienthal, Christopher. 2003. “Constitutional Challenge to Sentence Commutation Procedure Will March On: Federal Judge Preserves Due Process and Ex Post Facto Claims of Prisoner Advocates.” Pennsylvania Law Weekly (April 7). EXAMINATION A search, inspection, or inter rogation. In CRIMINAL PROCEDURE, the PRELIMINARY HEAR- ING held to decide whether a suspect arrested for a crime should be brought to trial. In trial practice, the interrogation of a witness to elicit his or her testimony in a civil or criminal action, so that the facts he or she possesses are presented before the trial of fact for consideration. In the law governing real property transac- tions, an investigation made into the history of the ownership of and conditions that exist upon land so that a purchaser can determine whether a seller is entitled to sell the land free and clear of any claims made by third persons. In patent law, an inquiry made at the Patent and Tradem ark Office to determine the novelty and utility of an invention for which a patent application has been filed and whether the invention interferes with any other invention. EXAMINER An official or other person empowered by another—whether an individual, business, or government agency—to investigate and review specified documents for accuracy and truthfulness. A court-appointed officer, such as a master or referee, who inspects evidence presented to resolve controverted matters and records statements made by witnesses in the particular proceeding pending before that court. A government employee in the PATENT AND TRADEMARK OFFICE whose duty it is to scrutinize the application made for a patent by an inventor to determine whether the invention meets the statutory requirements of patentability. A federal employee of the Internal Revenue Service who reviews income tax returns for accuracy and truthfulness. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 284 EXAMINATION EXCEPTION The act of excepting or excluding from a number designated or from a description; that which is excepted or separated from others in a general rule or description; a person, thing, or case specified as distinct or not included; an act of excepting, omitting from mention, or leaving out of con- sideration. Express exclusion of something from operation of contract or deed. An exception operates to take something out of a thing granted that would otherwise pass or be included. Objection to an order or ruling of a trial court. A formal objection to the action of the court, during the trial of a case, in refusing a request or overruling an objection; implying that the party excepting does not acquiesce in the decision of the court, but will seek to procure its reversal, and that he or she means to save the benefit of his or her request or objection in some future proc eeding. Under rules practiced in the federal and most state courts, the need for claiming an exception to evidence or to a ruling to preserve appellate rights has been eliminated in favor of an objection. EXCHANGE An exchange is an association, organization, or group of persons, incorporated or unincorporated, that constitutes, maintains, or provides a market- place or facilities for bringing together purchasers and sellers of securities or commodities futures. A security is a written proof of ownership of an investment, usually in the form of shares of stock, which are fractional units of ownership in a company. Commodities are raw materials such as wheat, gasoline, or silver that are sold either on the spot market, where cash is paid “on the spot,” or through futures contracts, where a price for a contract is set in advance, not to be changed even if the market price for the commodity increases or decreases by the time the contract comes due. Stock Exchanges The New York Stock Exchange (NYSE) is located on Wall Street in New York City. The NYSE acquired the American Stock Exchange in 2007, which was also located on Wall Street. Wall Street (named for a stockade built to protect the original settlers) is the busiest hub of SECURITIES trading in the United States. As of 2008, the combined capitalization of all U.S. companies traded on the NYSE was $10.1 trillion. There are five other, smaller, regional exchanges: the Pacific (in Los Angeles), Cincinnati, Chicago, Philadelphia (at the site of the first stock exchange in the United States), and Boston. These stock exchanges are private associations that sell memberships (seats) for a price, which can fluctuate based on the price of stocks and the volume of trading. The SECURITIES AND EXCHANGE COMMISSION, which was established pursuant to the Securities Act of 1933 (15 U.S.C.A. §§ 78a et seq., 78d), regulates the activities of securities exchanges (defined at 15 U.S.C.A. § 78c[a][1]). Private associations such as the NYSE and the National Association of Securities Dealers (NASD) initi- ate and execute a significant amount of self- regulation and disciplinary activities with the full support of the Securities and Exchange Commission. Futures Exchanges Futures contracts for commodities are traded on one of 11 commodities exchanges in the United States or on other exchanges throughout the world. Each futures contract is tied to the exchange that issued it. Exchanges specialize in various commodities, including currency and financial futures. For example, the Chicago Mercantile Exchange deals in meat, livestock, and currency, and the Minneapolis Grain Exchange exclusively deals in grain. Other exchanges include the Chicago Board of Trade and boards of trade and exchanges in Philadelphia; Kansas City, Missouri; and New York City. Traders buy and sell commodity futures on the floor of the Kansas City Board of Trade. AP IMAGES GALE ENCYCLOPEDIA OF AMERICAN LAW, 3 RD E DITION EXCHANGE 285 The Commodities Futures Trading Com- mission, which was established pursua nt to the Commodity Exchange Act (7 U.S.C.A. §§ 1 et seq., 4a[a]), regulates the activities of boards of trade, defined as associations or exchanges established to trade commodities futures. Pri- vate organizations such as the Chicago Board of Trade and the National Futures Association provide significant self-regulation to the com- modities futures trading market. The Auction Market Principle The floor of a stock or futures exchange operates on the auction market principle, whereby brokers meet face-to-face on the floor of the exchange to execute buy and sell orders. Futures exchanges operate on a pure auction system, often referred to as the open outcry system, where all trading takes place on the floor of the exchange, or in the pit. Buyers and sellers in the pit use hand signals and oral communications to place buy and sell orders simultaneously, acting for themselves and as agents for others. Securities exchanges operate on an auction- style system, where the market prices for securities are set by buyers and sellers meeting on the floor of the exchange. In contrast to futures exchanges, securities exchanges also employ specialists, who stand ready to buy or sell orders at market prices when there is, for example, a seller and no buyer for a particular security. In this capacity, specialists act as dealers, using their own capital to make bids and offers for stock. They can also act as brokers, holding limit orders (requests to buy or sell a security when it reaches a predetermined market price) for other brokers and executing those orders when the market moves up or down to the desired price. Specialists permit for a more orderly and continuous securities market and prevent wild price fluctuations due to imbalances in supply and demand. Computerized and Over-the- Counter Trading Computer technology has been introduced in the major exchanges to automate certain aspects of transactions, but the auction proces s remains the predominant method of trading securities in these forums. In fact, the statut ory definition of an exchange in the Securiti es Exch ange Act has been consistently interpreted not to include computerized trading. Stocks not traded on an exchange have historically been termed over-the-counter (OTC) stocks because they are sold over the counter (or desk or telephone) of individual brokers. The NASD once published the quotes of willing buyers and sellers of OTC stocks in what were called pink sheets. In the early 1970s, the NASD computerized this service and called it the National Association of Securities Dealers Auto- mated Quotations System. This decentralized method of trading stocks has grown in efficiency and popularity in the decades since its introduc- tion, but it has never been held to constitute an exchange because it does not facilitate the physical meeting of buyers and sellers. Like specialists in stock exchanges, who often are called upon to make the market (purchase and sell securities with their own money) in the absence of willing buyers and sellers, multiple market makers in the OTC market use their own capital to respond to fluctuations in the market. One development in the exchange of stocks has been the use of electronic communications networks (ECNs), which became popular in the United States and Europe in the late 1990s. ECNs are similar to stock exchanges in that they allow for stock transactions through a THIRD PARTY . They match orders to buy and sell at specified prices. They are also faster and more efficient than the traditional stock exchange. In 2000, the NYSE repealed a rule that limited member firms to trade only in stocks listed on the exchange. This repeal allowed securities listed on ECNs to become more competitive with stocks from larger companies. ECNs are required to register with the Securities and Exchange Com mission as broker- dealers. FURTHER READINGS Booth, Richard A. 1994. “The Uncertain Case for Regulating Program Trading.” Columbia Business Law Review 1. Gillette, Clayton P., and Steven D. Walt. 1999. Sales Law: Domestic and International. New York: Foundation Press. Maynard, Therese H. 1992. “What Is an ‘Exchange?’— Proprietary Securities Trading Systems and the Statu- tory Definition of an Exchange.” Washington & Lee Law Review 49. Morris, Kenneth M., and Alan M. Siegel. 1993. Wall Street Journal Guide to Understanding Money & Investing. Lightbulb Press. Romano, Roberta. 1996. “A Thumbnail Sketch of Derivative Securities and Their Regulation.” Maryland Law Review 55. Stockton, John M., and Frederick M. Miller. 2001. Sales and Leases of Goods in a Nutshell. 3d ed. St. Paul, Minn.: West. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 286 EXCHANGE CROSS REFERENCES Broker; Commodity Futures Trading Commission; Securi- ties; Securities and Exchange Commission. EXCHANGE OF PROPERTY A transaction wherein parties trade goods, or commodities, for other goods, in contrast with a sale or trading of goods for money. An exchange of property is a type of barter contract, applicable only to agreements relating to goods and services, not to agreements involving land. EXCISE A tax imposed on the performance of an act, the engaging in an occupation, or the enjoyment of a privilege. A tax on the manufacture, sale, or use of goods or on the carrying on of an occupation or activity, or a tax on the transfer of property. In current usage the term has been extended to include various license fees and practically every internal revenue tax except the income tax (e.g., federal alcohol and tobacco excise taxes). EXCLUSIONARY CLAUSE A term in a sales contract that limits the remedies available to one or both parties to it in an action for breach of warranty, statements made as to the quality of the goods sold. A provision of an insurance contract that prohibits recovery pursuant to its terms if certain designated circumstances occur. The exclusionary clause contains the excep- tions to insurance coverage upon which the insurer and insured have agreed prior to the execution of the policy. EXCLUSIONARY RULE Exclusionary rule is the principle based on federal constitutional law t hat evidence illegally seized by law enforcement officers in violation of a suspect’s right to be free from unreason able searc hes and seizures cannot be used against the suspect in a criminal prosecution. The exclusionary rule is designed to exclude evidence obtained in violation of a criminal defendant’s FOURTH AMENDMENT rights. The Fourth Amendment protects against unreason- able searches and seizures by law enforcement personnel. If the search of a criminal suspect is unreasonable, the evidence obtained in the search will be excluded from trial. The exclusionary rule is a co urt-made rule. This means that it was created not in statutes passed by legislative bodies but rather by the U.S. Supreme Court. The exclusionary rule applies in federal courts by virtue of the Fourth Amendment. The Court has ruled that it applies in state courts by virtue of the due process clause of the FOURTEENTH AMENDMENT. (The Bill of Rights—the first ten amendments—applies to actions by the federal government. The Fourteenth Amendment, the Court has held, makes most of the protections in the BILL OF RIGHTS applicable to actions by the states.) The exclusionary rule has been in existence since the early 1900s. Before the rule was fashioned, any evidence was admissible in a criminal trial if the judge found the evidence to be relevant. The manner in which the evidence had been seized was not an issue. This arrange- ment began to change in 1914, when the U.S. Supreme Court devised a way to enforce the Fourth Amendment. In Weeks v. United States, 232 U.S. 383, 34 S. Ct. 341, 58 L. Ed. 652 (1914), a federal agent had conducted a warrantless search for evidence of gambling at the home of Fremont Weeks. The evidence seized in the search was used at trial, and Weeks was convicted. On appeal, the Court held that the Fourth Amendment barred the use of evidence secured through a warrantless search. Weeks’s conviction was reversed and thus was born the exclusionary rule. The exclusionary rule established in Weeks was constitutionally required only in federal court until Mapp v. Ohio, 367 U.S. 643, 81 S. Ct. 1684, 6 L. Ed. 2d 1081 (1961). In Mapp, Cleveland police officers had gone to the home of Dollree Mapp to ask her questions regarding a recent bombing. The officers demanded entrance into her home. Mapp called her attorney and then refused to allow the officers in without a warrant. The officers became rough with Mapp, handcuffed her, and searched her home. They found allegedly obscene books, pictures, and photographs. Mapp was charged with violations of obscenity laws, prosec uted, convicted, and sentenced to seven years in prison. The Ohio Supreme Court affirmed the conviction, but the U.S. Supreme Court overturned it. In Mapp, the Court held that the exclusion- ary rule applied to state criminal proceedings through the due process clause of the Four- teenth Amendment. Before the Mapp ruling, GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EXCLUSIONARY RULE 287 not all states exclud ed evidence obtained in violation of the Fourth Amendment. Since Mapp, a defendant’s claim of unreasonable SEARCH AND SEIZURE has become a matter of course in most criminal prosecutions. A criminal defendant’s claim of unreason- able search and seizu re is usu ally heard in a suppression hearing before the presiding judge. This hearing is conducted before trial to determine what evidence will be suppressed, or excluded, from trial. The exclusionary rule has continued in the 2000s to be regularly invoked by criminal defendants, but its golden age may have passed. Since the 1980s, the U.S . Supreme Court has severely limited its application. According to the Court, this rule was not devised to cure all Fourth Amendment violations. Rather, it was designed primarily to deter police misconduct. This construction led to the GOOD FAITH exception to Fourth Amendment violations established in United States v. Leon, 468 U.S. 897, 104 S. Ct. 3405, 82 L. Ed. 2d 677 (1984). In Leon, police officers searched the Bur- bank, California, home of Alberto A. Leon, and arrested Leon after they found a large quantity of drugs in his possession. The search was executed pursuant to a warrant that was later determined to be invalid. The information provided by the police in their affidavit in support of the warrant had been stale, which meant that too much time had passed between the observations that prompted it and the application for the warrant. No evidence suggested that a police officer had lied about facts. Rather, the staleness of the affidavit had simply been overlooked by the magistrate. The drug evidence seized from Leon’shome was excluded from trial by the U.S. District Court for the Central District of California, and the Ninth CIRCUIT COURT of Appeals affirmed the ruling. On appeal, the U.S. Supreme Court reversed, holding that evidence gathered in a search executed pursuant to a warrant later found to be defective should not be excluded from trial. The majority in Leon opened its analysis by noting that the Fourth Amendment “contains no provisions expressly precluding the use of evidence obtained in violation of its com- mands.” The exclusionary rule, according to the majority, was not designed to be a personal right. It was created by the Court “to deter police misconduct rather than to punish the errors of judges and magistrates.” Under this interpretation, excluding evidence obtained through an honest mistake would serve no purpose. The Court ’s ruling in Leon meant that evidence obtained in violation of a person’s Fourth Amendment rights would not be excluded from trial if the law enforcement officer, although mistaken, acted reasonably. Justice JOHN PAUL STEVENS dissented, arguing that the facts of the case did not warrant such a sweeping exception to the exclusionary rule. In a separate dissenting opinion, Justices William J. Brennan Jr. and THURGOOD MARSHALL conceded that “as critics of the exclusionary rule never tire of repeating, ” the Fourth Amendment does not contain an express provision calling for the exclusion of evidence seized in violation of its commands. Brennan and Marshall dismissed this argument by noting that the Constitution is stated in general terms and that the U.S. Supreme Court regularly creates doctrines designed to enforce its simple terms. Brennan and Marshall maintained that “the chief deterrent function of the [exclusionary] rule is” far beyond the simple prevention of police misconduct, “the tendency to promote institutional compliance with Fourth Amend- ment requirements on the part of law enforce- ment agencies generally.” In other w ords, if a SEARCH WARRANT is found defective at any point in the prosecution, the evidence should be excluded, even if the defect is due to an honest mistake. This, according to Brennan and Marshall, would preserve the integrity of both law enforcement and the Fourth Amendment. Brennan and Marshall concluded that the majority’s reli ance on the deterrence rationale “robbed the [exclusionary] rule of legitimacy.” In 1995 the U.S. Supreme Court revisited the good faith exception to the exclusionary rule. In Arizona v. Evans, 514 U.S. 1, 115 S. Ct. 1185, 131 L. Ed. 2d 34 (1995), the error of a court employee mistakenly listed Isaac Evans as the subject of a misdemeanor ARREST WARRA NT.A police officer had stopped Evans for a traffic violation, searched Evans pursuant to the faulty warrant information, and found marijuana. On trial for possession of marijuana, Evans moved to suppress the marijuana evidence. The Maricopa County Superior Court granted the motion. The state of Arizona appealed, and the Arizona Court of Appeals reversed. The Supreme Court of Arizona then heard the case and held that the evidence should be excluded. GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 288 EXCLUSIONARY RULE . Model CODE OF JUDICIAL GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EX PARTE 281 CONDUCT discourages judges from such ex parte communications. Under rule 4. 2 of the ABA Model Rules of PROFESSIONAL. laws ( Carpenter v. Pennsylvania, 58 U.S. (17 How.) 45 6, 15 L. Ed. 127 [18 54] ). GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION 282 EX POST FACTO LAWS In Carpenter, the Court noted that the esteemed. majority, “laws that lower the BURDEN OF PROOF and laws that reduce the quantum of evidence necessary GALE ENCYCLOPEDIA OF AMERICAN LAW, 3RD E DITION EX POST FACTO LAWS 283 to meet the burden are indistinguishable