Small claims courts are courts of limited jurisdiction- meaning that they only handle disputes that don’t involve large amounts of money. Each state has a threshold amount that falls within the jurisdiction of their small claims court- to find out what the amount is in your state, click here.
In some cases, a plaintiff must choose whether to sue in small claims court or regular court. By suing in a small-claims court, the plaintiff typically waives any right to claim more than the court can award, but can take advantage of the expedited and simpler nature of the small claims venue. The plaintiff may or may not be allowed to reduce a claim to fit the requirements of this venue. ‘Court shopping’—where a plaintiff reduces the damage claim amount to have a trial in a court that otherwise does not have jurisdiction—is strictly forbidden in some states. For example, if a plaintiff asserts damages of $30,000 in hopes of winning an award of $25,000 in small-claims court, the court dismisses the case because the court does not have jurisdiction to hear cases in which asserted damages exceed the court’s maximum amount.
Thus, even if the plaintiff is willing to accept less than the full amount, the case cannot be brought to small-claims court. To bring the case to small-claims court, the plaintiff must prove that actual damages are within the court’s jurisdiction. In some jurisdictions, a party who loses in a small-claims court is entitled to a trial de novo in a court of more general jurisdiction and with more formal procedures.
The rules of civil procedure, and sometimes of evidence, are typically altered and simplified to make the procedures economical. A usual guiding principle in these courts is that individuals ought to be able to conduct their own cases and represent themselves without a lawyer. Rules are relaxed, but still apply to some degree. In some jurisdictions, corporations must still be represented by a lawyer in small-claims court. Expensive court procedures such as interrogatories and depositions are usually not allowed in small-claims court, and practically all matters filed in small-claims court are set for trial. Under some court rules, should the defendant not show up at trial and not have requested postponement, a default judgment may be entered in favor of the plaintiff.
Jury trials are seldom or never conducted in small-claims courts. Similarly, equitable remedies such as injunctions are seldom available from small-claims courts.
Winning in small-claims court does not automatically ensure payment in recompense of a plaintiff’s damages. This may be relatively easy, in the case of a dispute against an insured party, or extremely difficult, in the case of an uncooperative, transient, or indigent defendant. The judgment may be collected through wage garnishment and liens.
Most courts encourage parties with disputes to seek alternative dispute resolution, if possible, before filing suit.