So let's back it up and talk about the mitzva to create a Torah judicial system throughout the land.
שֹׁפְטִים וְשֹׁטְרִים תִּתֶּן לְךָ בְּכָל שְׁעָרֶיךָ אֲשֶׁר ה' אֱלֹקֶיךָ נֹתֵן לְךָ לִשְׁבָטֶיךָ וְשָׁפְטוּ אֶת הָעָם מִשְׁפַּט צֶדֶק" (דברים ט"ז,יח).
Does it Apply in Chutz La'Aretz?
According to the Ramban's understanding(על דברים ט"ז,יח) of the Rambam, the mitzva to appoint judges only applies within Eretz Yisrael. The Ramban himself feels that it also applies in chutz la'aretz, but not necessarily in every single city
אתה מושיב בכל פלך ופלך ואי אתה מושיב בכל עיר ועיר
And note that Rav Fiksler makes a compelling argument that the Rambam may have actually held of the Ramaban's opinion himself.
But, in any case, we have too opinions and according to both there is a difference between our obligation to set-up halachic legal systems in Eretz Yisrael and Chutz La'Aretz. The the question, however, WHY? Why is the difference between different the different lands and why the difference between the two opinions?
Mitzvot in Eretz Yisrael
I'm reminded of the oft-quoted Ramban(ויקרא יח כה) on Eretz Yisrael's special status as Hashem's Domain and the resultant special status that Mitzva observance has there. According to this, we can certainly understand the Rambam's opinion(as understood by Ramban) that the mitzva only applies in Eretz Yisrael. Because of the increased importance of mitzva observance within the Land, there is a separate mitzva to create legal institutions to help enforce said observance.
Of course, the other opinion, that the mitzva of Shoftim Veshotrim also applies in Chutz La'Aretz, doesn't contradict this principal. Rather, a mitzva can exist for multiple reasons and so the mitzva in chutz La'Aretz exists generally to promote mitzva observance and to help settle disputes in a civil manner. It nevertheless has a lesser importance and therefore the obligation allows for a more sparse distribution of Batei Din in Chutz La'Aretz