Small claims courts are courts of limited jurisdiction that resolve civil disputes between private parties. Small claims courts were established to offer individuals a simple and cost-effective means of settling cases involving relatively small amounts of money. Trials heard in small claims court are much less formal than trials in other courts. Small claims courts typically do not use juries, leaving cases to be decided by a judge or magistrate. Parties to a small claims suit present their own legal and factual arguments, and are typically not represented by attorneys. Parties may bring witnesses to testify and help tell their story, and they may also introduce documents such as receipts, contracts or photographs. The rules of civil procedure and evidence are simplified to make the process move quickly and be accessible to all citizens.
In order to be heard in small claims court, both the parties and the case itself must meet certain prerequisites. If the requirements are not met, the parties must file the lawsuit in another court. While specific prerequisites vary among jurisdictions, the basic requirements are the same. First, a person must be eighteen years of age or older to bring a small claims suit. Institutions that lend money for interest, such as banks, cannot file a suit in small claims court. Collection agencies are also prohibited from using small claims proceedings to adjudicate their disputes. Corporations, however, are entitled to bring claims in small claims court if they are represented by an employee or officer. Small claims courts may only hear disputes involving a certain amount of money. In many jurisdictions, the small claims cases cannot be worth more than $5,000. Often, a party may reduce a claim in order to file in small claims court. If a party prevails in small claims court, they may recover only money, and they cannot recover more than the amount set by their court. The court cannot order people to act or stop acting in a certain way, nor can the court compensate parties with property or services. The court can also make no guarantee that the losing party will pay the judgment.
Types of Claims Filed in Small Claims Court
Generally, claims filed in small claims court involve one party who believes they are owed a sum of money by another party. Thus, small claims court cases often involve loans that have not been repaid, breach of contract actions, property damage caused by trespassing or automobile accidents, payment for work performed and landlord-tenant disputes, such as failure to return a deposit or wrongful eviction. Typically, small claims courts do not hear family law matters, such as domestic disputes or alimony claims.
Right to Appeal
The losing party may have the right to appeal the small claims court's ruling in superior court. The superior court reviews the small claims court's decision de novo. This means that the court will look at the transcript of the small claims court action and will reverse the ruling if they find that the small claims court made a significant error of law or fact.