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Subject matter jurisdiction is the authority of a court to hear the type of case brought before it. It is jurisdiction over the type of claim brought by the plaintiff. For example, a small claims court only has subject matter jurisdiction of claims up to a certain dollar amount. Federal courts have jurisdiction over claims involving federal laws.
In another example, the court has subject matter jurisdiction over a divorce case when a spouse has lived in the county where the court is located for a certain period of time. The court is then held to have jurisdiction over the subject matter of the marriage. This is distinguished from other types of jurisdiction, such as personal jurisdiction to exercise authority to order a person to appear in court.