Crucial Exams

Multistate Bar Examination Practice Question

A technology firm based in State X enters into a partnership with a firm from State Y. They have a dispute over the partnership agreement, and the case is filed in federal court located in State X under diversity jurisdiction. There is no specific federal statute that addresses the issues in their contract. Which of the following best explains how the federal court should approach the applicable law in resolving this dispute?

  • Develop and apply federal common law principles to address the contract issues.

  • Apply the substantive contract law of State X to resolve the dispute.

  • Apply general federal law principles since the case is in federal court.

  • Refer the case to a state court instead of the federal court.

Multistate Bar Examination
Civil Procedure
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