The correct answer is: A State trial court.
Step-by-step explanation:
The state trial court has general jurisdiction over disputes that occur within the borders of the state, they can happen in different cities as long as they are in the same state. The majority of civil and criminal cases are held in state trial courts and the law is applied according to each state's constitution unless the higher level state asks for the case to be hand over. A dispute over a contract between two people that live in the same city would be heard in a state trial court and would be resolved with the state's constitution and statutes.