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The objective of the study remained three-fold : namely to understand and describe how the different aspects of state legal system (i.e. Police, Courts , Jury, Correctional Services, Community programs, State Counseling Services etc.) are (i) perceived (ii) used and (iii) evaluated in terms of their efficacy to resolve disputes by the members of different races in the traditional southern black city of United States. Paper will also discuss the impact of changing demographics on the settlement mechanisms. Additionally, paper will also discuss such situations or cases where disputes are resolved outside the state legal system and the reasons there of.