Before deciding whether to sue someone in small claims court, it’s important to understand the limitations and the purpose of this kind of court. First, you must understand the types of cases that you can file in small claims court:
Next, you must understand the limitations for the amount of money you can collect in small claims court. Small claims court can only be used to reclaim monetary amounts between $2,500 and $15,000. The amount varies by state; for example, the State of Kentucky limits small court claims to $2,500, while the State of Delaware allows claims of up to $15,000.
Finally, you must determine whether the person you are suing has the capability to pay you. For example, just because the judge declares you the "winner" does not mean you will collect the judgment. In fact, although many businesses and individuals are solvent and will pay, there are a certain number of defendants who are considered “judgment proof,” which means that they will not voluntarily pay you – either because they have no income or assets, or because they simply decide to hide the assets that they do have. And although there are some laws that will help you collect a judgment, there are also laws that will prevent you from seizing certain types of property.
Let’s put aside the question of whether or not you can actually collect. The good news is that filing a claim in small claims court is actually quite simple and can be the quickest and easiest way to collect debts. With that in mind, let’s take a look at the steps you will need to follow to complete your small claim's court case.
Unfortunately, even if you win your case, the court will not simply cut you a check for the amount owed. You will have to collect the judgment. Best-case scenario: The defendant will agree to pay and pay you either in full or through installment payments.
Otherwise, you will have to get what is generally called a writ of execution or a writ of attachment. This will allow the appropriate authorities to seize assets. This can include collecting money from the debtor’s bank accounts, seizing personal assets that are not exempt or placing a lien on real estate. A writ of garnishment can also be used to collect a percentage of the defendant’s wages.
Claims can be filed in small claims court without hiring a lawyer. In fact, California, Michigan and Nebraska do not allow claimants to have legal representation. Other states allow it, but generally the cost to hire an attorney is too high given the limited amount of money that you are likely to collect if you win your lawsuit.