As a business owner it is common to face disputes disputes at some point or another. However, given the time and expense involved, filing a lawsuit in civil court to resolve such minor disputes typically isn’t worthwhile, especially if you are only trying to recover a few thousand dollars.
If you can’t resolve the dispute privately, taking the case to small claims court may be your best option. Small claims courts are specifically designed to resolve relatively low-collar cases quickly and inexpensively.
If you are considering taking a case to small claims court, below we will review the basics of Small Claim Courts:
What types of cases are resolved in small claims court?
Small claims courts are real courts, and a judgment issued by a small claims court is just as binding and enforceable as one made in a traditional civil court. Small claims court can be a quick and inexpensive way for your business to collect on unpaid debts and resolve contractual disputes with clients, vendors, and other companies. However, you can only take your case to a small claims court if the money you’re seeking to collect is below a certain amount, which is known as the court’s jurisdictional limit.
Be aware that no state allows for small claims court cases involving divorce, guardianship, name changes, bankruptcy, or to seek an injunction against another individual. These cases all require you to file a lawsuit in state civil court.
Where can I file my small claims lawsuit?
If the other party does business or lives in our state, the law typically requires you to file your lawsuit in the small claims court district closest to that person’s residence or business headquarters. In some cases, you also may be able to file in the district where a legal agreement was signed or the dispute in question occurred. Check with the local small claims clerk for more detailed information.
In the event the other party you are looking to sue has no business or other contact within the state, you will most likely have to file your case in the state where the individual lives or does business. That said, unless the other party lives in a nearby state, out-of-state small claims lawsuits can be cost prohibitive due to travel expenses, so be sure to factor in the cost of traveling before you file your claim.
How does the small claims court process work?
To better understand, let’s get clear on some terminology. The person who initiates the claim is the plaintiff, and the person who is being sued is the defendant. The process begins when the plaintiff files a statement of claim with the county or district where the case will be held. You can typically get all the necessary paperwork for filing your claim from our local clerk of court website. Additionally, you will need to pay court fees, but they’re typically small, ranging from $20 to $200.
Once the claim has been filed, the court may schedule an initial pretrial conference and/or order the parties to mediation. If the case can’t be resolved via mediation, the court will set a trial date, which will typically be a month or so from the time the claim was filed.
Although small claims procedures vary by states and districts, for the most part the hearings are fairly informal and don’t involve complicated legal procedures or strict rules of evidence. Nonetheless, you still need to prepare and present your case before the judge. Make sure to bring all the documentation needed to help prove your case, such as contracts, invoices, photos of damages, copies of emails, and/or sales receipts. Some states also allow you to call witnesses.
One of the biggest advantages of small claims court is the time it takes for your case to be decided. Different from civil court, where cases can drag out for months or even years, a small claims judge normally issues judgment on the spot, once both sides have presented their arguments and evidence.
Do I need an attorney?
Small claims court is set-up to be easy to navigate on your own, without the need for an attorney. As a matter of fact, some states even prohibit lawyers from being present. Indeed, avoiding costly attorney’s fees is one of the primary benefits of these courts.
Of course, if you are going to file a case in small claims court and you are a client, you should definitely call and discuss your strategy with us first, and we can advise you about how to proceed, and/or assist with collecting a judgment.
Collecting a judgement:
Unfortunately, the court won’t collect your money for you. If you win your case and are awarded a judgment, unless the defendant agrees to pay you or you both agree to a payment plan, you may have to go back to court to get a lien on the defendant’s property or have the court order a wage garnishment.
At Legacy Counsel, we are here for you, to support and guide the best ways to collect on your judgment to ensure you get all the money you are owed.
If I lose, can I appeal my case?
In majority of the states, you cannot appeal if he or she loses. If the defendant loses, he or she can generally file an appeal, and if it’s accepted, a new trial will be held in a higher court. Once the appeal is finalized, the small claims court trial is completely negated, as if it never happened.
We are here for you!
At Legacy Counsel, we ensure assisting you in deciding whether to take your particular dispute to small claims court, as well as help you prepare your case. And although you most probably won’t need us during the trial, we’re here to support you, offering you better chances in winning your case and collect on your judgment. Call us today to learn more!
