In most states, a defendant doesn't have to file any papers to defend a case in small claims court unless the defendant wants the case transferred to formal court. However, in a few states, a defendant must respond in writing. (See the Appendix for your state's rules.) In the majority of states, defendants simply show up for the hearing on the date and at the time indicated on the papers served on them, ready to tell their side of the story. (If you need to get the hearing delayed, see "Changing a Court Date," below.) It is proper, and advisable, for a defendant to call or write the plaintiff and see whether a fair settlement can be reached without going to court, or to propose mediation. (See Chapter 6.)
Sometimes a party you planned to sue sues you first (for example, over a traffic accident where you each believe the other is at fault). As long as your grievance stems from the same incident, you can file a defendant's claim (sometimes called a counterclaim) for up to the small claims court maximum and have it heard by a judge at the same time that the plaintiff's claim against you is considered. However, if you believe that the plaintiff owes you money as the result of a different injury or breach of contract, you may have to file your own separate case.
In all states you must file any defendant's claim (counterclaim) in writing within a certain time period after being served with the plaintiff's claim (usually ten to 30 days). When you file a defendant's claim, you become a plaintiff as far as this claim is concerned. In those states where only the defendant can appeal, this means that if you lose your defendant's claim, you can't appeal that part of the case. Of course, even in these states, if you lose on the original plaintiff's claim, you can normally appeal that portion of the judgment. Appeal rules vary from state to state and can be complicated. (See Chapter 23 and the Appendix.)
In most states, if a defendant's claim is for more than the small claims maximum, the case will be transferred to a formal court. Some states allow transfers only at the discretion of a judge, who may inquire whether the defendant's claim is made in good faith. Check your court rules and your state's listing in the Appendix. A defendant who does not want to cope with the procedures of formal court may be wise to scale down the claim to fit under the small claims limit. (See Chapter 4.)
A defendant may be required to file a defendant's claim or lose the right to do so. A defendant who has a claim against a plaintiff arising out of the incident underlying the plaintiff's lawsuit will almost always want to promptly file it. Some states require defendants to file a counterclaim as part of the plaintiff's lawsuit; others allow defendants to file their own lawsuit later. If this is an issue for you, check your state's rules.