Many states allow judges to grant relief (provided you ask for it) in ways that do not involve the payment of money, if equity (fairness) demands it. In small claims court, equitable relief is usually limited to one or more of four categories: rescission, restitution, reformation, and specific performance. Let's translate these into English.
This is a remedy that is used to wipe out a grossly unfair or fraudulent contract under any of the following conditions:
- it was based on a mistake as to an important fact
- it was induced by duress or undue influence, or
- one party simply didn't receive what was promised, through the fault of the other.
EXAMPLE: If a merchant sues you for failure to pay for aluminum siding, the quality of which you contend the merchant seriously misrepresented, you could ask that the contract be rescinded and that any money you paid be returned to you. Don't hesitate to ask for this remedy whenever you feel you have been unfairly treated in a contract dispute.
This is an important remedy. It gives a judge the power to order that a particular piece of property be transferred to its original owner when fairness requires the contracting parties be restored to their original positions. It can be used in the common situation in which one person sells another a piece of property (say a motor scooter) and the other fails to pay. Instead of simply giving the seller a money judgment that might be hard to collect, the judge has the power to order the scooter restored to its original owner. If money has been paid under a contract that is rescinded, the judge can order it to be returned, plus damages. Thus, if a used car purchase was rescinded based on the fraud of the seller, the buyer could get a judgment for the amount paid for the car, plus money spent for repairs and alternate transportation.
This remedy is somewhat unusual. It has to do with changing (reforming) a contract to meet the original intent of the parties in a situation where some term or condition the parties agreed to was left out or misstated and where fairness dictates the contract be reformed. Reformation is commonly used when an oral agreement is written down incorrectly.
EXAMPLE: Arthur the Author and Peter the Publisher orally agree that Peter will publish Arthur's 200-page book. They then write a contract, inadvertently leaving out the number of pages. If Arthur shows up with a 3,000-page manuscript and demands that it be published in its entirety, a court would very likely "reform" the contract to include the 200-page provision, assuming the judge was convinced that it should have been included in the first place.
This is an important remedy that comes into play when a contract involving an unusual or one-of-a-kind object has not been carried out. For example, you enter into an agreement with someone to buy a unique antique jade ring for your mother's birthday that is exactly like the one she lost years before. If the seller refuses to go through with the deal, a court could cite the doctrine of specific performance to order that the ring be turned over to you. Specific performance will only be ordered in situations where the payment of money will not adequately compensate the person bringing suit.
The small claims dollar maximum applies to cases involving equitable relief. In filling out your court papers for a case in which you want one of the types of equitable relief discussed here, you are still required to indicate that the value of the item in question is under the small claims maximum. Thus, you might describe the nature of your claim as follows: "I want the delivery of my 'one-of-a-kind' antique jade ring, worth approximately $4,000, according to my contract with defendant."
Conditional judgments and equitable relief
In some states, judges have the power to issue conditional judgments in cases involving equitable relief. That is, they can order a party to perform, or stop, a certain act or else pay a money judgment. For example, you agree to sell your baby grand piano for $3,000. The buyer fails to pay, and you sue. The judge orders the buyer to either return the piano or fork over the $3,000. If the piano isn't returned within a short period of time (determined by the judge), then you can enforce the money judgment.