Small Claims Court & Consumer Lawsuits
Litigation can be time-consuming and expensive, requiring plaintiffs to devote months or years of their lives to the process while incurring legal fees and other costs. The American legal system has developed several ways to enable consumers to assert their rights without bearing the full burden of a lawsuit. Class actions, for example, allow large numbers of consumers with similar claims to bring suit together and share the expense of litigation. State judicial systems have created small claims courts, which allow consumers to bring claims with relatively low damages amounts against businesses, landlords, and others in a less formal setting. Many states relax their procedural and evidentiary rules in small claims court, so proceedings function more like an arbitration or mediation than a trial.
Jurisdiction of Small Claims Court
Small claims courts only exist at the state level. Federal courts have jurisdiction over all matters involving federal law, and they can only exercise diversity jurisdiction over questions of state law if the amount-in-controversy is $75,000 or more. This is much higher than the maximum amount in any state’s small claims court.
In many states, justices of the peace preside over small claims courts. Justices of the peace often have primary jurisdiction over certain types of cases, such as evictions and other landlord-tenant matters. As small claims court judges, they have jurisdiction over civil disputes with damages claims within the limits set by state law.
Larger disputes must be filed in the regular court system, which might include county courts, district courts, superior courts, or circuit courts, depending on the state. Those courts may have exclusive jurisdiction over certain types of cases, such as divorce and other family law matters.
Some states require disputes below a certain amount to be filed in small claims court, while others make it optional. The filing fees for small claims court lawsuits are often significantly lower than those for cases filed in higher courts, so it is often financially prudent to file claims with small damages amounts there.
Types of Cases Brought in Small Claims Court
Anyone familiar with popular courtroom television programs like The People’s Court and Judge Judy is probably familiar with the types of cases filed in small claims court, which may include:
- Minor personal injury claims;
- Failure to return a security deposit;
- Disputes with an auto mechanic or auto dealer;
- Home construction disputes;
- Breach of warranty claims; and
- Other claims under state consumer protection laws.
Monetary Limits
Each state establishes a maximum amount-in-controversy limit for small claims courts. The courts are not allowed to award damages above this amount, except in some states awards of court costs and attorneys' fees are not included in the maximum amount.
Monetary limits range from $2,500 in Kentucky to $5,000 in Rhode Island to $15,000 in Georgia and North Dakota to $25,000 in Tennessee.
Procedural and Evidentiary Rules
Smalls claims court proceedings are subject to somewhat relaxed rules regarding procedure and evidence, primarily in order to enable claimants to present their cases without the services of a lawyer. Plaintiffs and defendants, however, are usually allowed to have counsel represent them in small claims court.
Consumers may present evidence in the form of eyewitness testimony, photographs, written contracts, and correspondence with the defendant, advertisements and other materials prepared by the defendant, and other documents that support their claims. Expert testimony is not common in small claims trials. This includes testimony and written reports offered by someone who has specialized knowledge of an important aspect of the claim, such as auto repair or home construction. Plaintiffs must be able to prove that any photographs and documents they offer as evidence are authentic, and the hearsay rule may limit the witness testimony they can offer.
At the end of a trial, the judge will consider the evidence and issue a ruling. Small claims courts are usually not courts of record, meaning that no court reporter is present to transcribe what the judge says. The judge will sign a written ruling making a decision in favor of the plaintiff or the defendant, and if applicable, ordering the defendant to pay a certain amount in damages. The defendant might be able to appeal the ruling to a county court or other higher court. The plaintiff, once any appeals process has ended, can enforce the judgment through various methods, such as a writ of execution.
