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:
(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