Chapter 1

In the Beginning

First Things..................................................................................... 6

Things to Think About Early On..................................................... 8

Some Legal Jargon...................................................................... 11

How to Use This Book................................................................. 18

First Things

The purpose of small claims court is to hear disputes involving modest amounts of money, without long delays and formal rules of evidence. Disputes are presented by the people involved, and lawyers are normally prohibited. The maximum amount of money that an individual can sue for in California is $10,000 (it’s $6,500 if you are suing a bonding company or other guarantor). Corporations and other entities (like government entities) can only ask for up to $5,000. In legal jargon, this is called the jurisdictional amount. In addition, you are only allowed to bring two lawsuits for more than $2,500 within any calendar year unless you are suing on behalf of a local government body, in which case there is no limit. To establish your eligibility to sue for between $2,500 and $10,000, you will have to state on your plaintiff’s claim form that you have not already used up your yearly quota.

There are three great advantages of small claims court:

• You get to prepare and present your own case without having to pay a lawyer more than your claim is worth.

• Filing, preparing, and presenting a small claims case is relatively easy. The gobbledygook of complicated legal forms and language found in other courts is kept to a minimum. To start your case, you need only fill out a few lines on a simple form called a “plaintiff’s claim.” For example, you would state: “Defendants owe me the sum of $4,000 because the 2008 Neon they sold me on January 1, 2009, in supposedly ‘excellent condition’ died less than a mile from the car lot.” When you get to court, you can talk to the judge in plain English without any legal jargon. Even better, if you have helpful documents or witnesses, you can present them to the judge without complying with the thousand years’ accumulation of rusty, musty procedures, habits, and so-called rules of evidence that must be followed in other courts.

• Small claims court doesn’t take long. Most disputes are heard in court within a month or two from the time the complaint is filed. The hearing itself seldom takes more than 15 minutes. The judge announces a decision either right there in the courtroom or mails it within a few days.

But before you decide that small claims court sounds like just the place to bring your case, you will want to answer a basic question: Will the results you expect to achieve balance out the effort you will have to expend? Even in small claims court, a successful case will probably take ten to 20 hours to prepare and present and, depending on your personality, may actually cause a few sleepless nights.

In order to assess whether your dispute is worth the effort of bringing to court, you will want to understand the details of how small claims court works. Being clear about who can sue, where, and for how much is a good start. You will also want to learn a little law to answer such important questions as whether you are likely to win and, if so, how much. And, of course, even if you conclude you do have a winning case, you’ll want to understand how best to prepare and present it. Finally, and most importantly, comes the detail that so many people overlook, to their later dismay. Assuming that you prepare and present your case brilliantly and get a judgment for everything you request, can you collect the money? The ability to get paid seems a silly thing to overlook, doesn’t it? Unfortunately, many plaintiffs who go through the entire small claims procedure and come out winners have no chance of collecting a dime because they have sued a person who has neither money nor any reasonable prospect of getting any.

The purpose of the first part of this book is to help you decide whether or not you have a case worth pursuing. These are not the chapters where grand strategies are brilliantly unrolled to baffle and confound the opposition—that comes later. Here we are more concerned with such mundane tasks as locating the person you want to sue, suing in the right court, filling out the necessary forms, and properly delivering the forms to the person you’re suing. Most California small claims forms and rules are the same for the entire state, although a few forms may vary slightly from one county to the next. Blank copies of all state-issued forms are available at your local small claims court clerk’s office and from www.courtinfo.ca.gov (click “Forms,” then select “Small Claims” from the drop-down list of forms).

Things to Think About Early On

Here is a preliminary checklist of things you will want to think about at this initial stage. As you read further, we will go into each of these areas in more detail. But if you haven’t already gotten a copy of your local small claims court rules, do it now. Free small claims information sheets are available to you in all counties and online at www.courts.ca.gov/forms.htm (select forms group “Small Claims”). Plaintiffs will want to refer to Form SC-100-INFO, Information for the Small Claims Plaintiff. Defendants will want to study the Information for the Defendant section of Form SC-100 (Plaintiff’s Claim and Order to Go to Small Claims Court). If you have further questions, you can either meet with a trained small claims adviser in person or talk to one by phone. (See “Free Small Claims Advice” in Chapter 13.)

TIP

Defendants may want to file their own lawsuit. In addition to their right to defend themselves, defendants also have the opportunity to file their own case against the plaintiff. (See Chapters 10 and 12.) If you are sued, you’ll want to do this if you believe that you lost money due to the same events and the plaintiff is legally responsible for your loss. Defendants’ claims commonly develop out of a situation in which both parties are negligent (say in a car accident) and the question is who was more at fault. If your claim is for less than the small claims court maximum, you can file your defendant’s claim in small claims court. But if it is for more, you will want to file your case in superior court and have the small claims court case transferred there. (See Chapter 10.)

Some Legal Jargon

Mercifully, there is not a great deal of technical language used in small claims courts. But there are a few terms that may be new to you and that you will have to become familiar with. Don’t try to learn all of these terms now. Refer back to these definitions when you need them.

Abstract of Judgment. An official document you get from the small claims court clerk’s office that indicates that you have a money judgment in your favor against another person. Filing it with the county recorder places a lien on real property owned by the judgment debtor. (For more information about property liens, see Chapter 24.)

Appeal. In the small claims context, a request that the superior court rehear the case from scratch and reverse the decision of the small claims court. Only a defendant can appeal the plaintiff’s claim, and only the plaintiff can appeal the defendant’s counterclaim, if there is one. In other words, a small claims appeal cannot be made by the person who brought the claim in the first place (the plaintiff). The appeal is heard in the appellate division of the superior court, and the parties may (but do not have to) be represented by ­attorneys.

Calendar. A list of cases to be heard by a small claims court on a particular day. A case taken off calendar is removed from the list. This usually occurs because the defendant has not received a copy of the plaintiff’s lawsuit or because the parties jointly request that the case be heard on another day.

California Civil Code (Civ. Code) and California Code of Civil Procedure (Code Civ. Proc.). Books that contain some of California’s most widely used substantive and procedural laws. They are available at all public law libraries (usually located at the county courthouse), or online at Nolo’s website (www.nolo.com). Go to “Site Map,” choose “State Law Resources,” then “California.” Small claims rules are covered in Code Civ. Proc. §§ 116.110–116.950.

Claim of Exemption. A procedure by which a judgment debtor can claim that, under federal or California law, certain money or other property is exempt from being grabbed to satisfy a debt.

Conditional Judgment. When a court issues equitable relief (such as the return of a piece of property), it has power to grant a conditional judgment. A conditional judgment consists of certain actions or requirements that are contingent on other actions (for instance, return the property in ten days or pay $2,000).

Continuance. A court order that a hearing be postponed to a later date.

Default Judgment. A court decision for the plaintiff (the person filing suit) when the defendant fails to show up (that is, defaults).

Defendant. The person or party being sued.

Defendant’s Claim. A claim by a defendant that the plaintiff owes him or her money, also called a Defendant’s Claim and Order to Go to Small Claims Court (Form SC-120). The claim is filed as part of the same small claims action that the plaintiff started.

Dismissed Case. A dismissal usually occurs when a plaintiff drops the case. If the defendant has not filed a counterclaim, the plaintiff simply files a written request for dismissal. If the defendant has filed a counterclaim, both plaintiff and defendant must agree in writing before the court will allow a dismissal. A judge may also dismiss a case if a defendant successfully claims that a case was filed in the wrong court. (See Chapter 9.) Also, if a plaintiff does not show up in court on the appointed day, the judge may dismiss the case. Most cases are dismissed without prejudice, which is legal jargon meaning they can be refiled. But if a case is dismissed with prejudice, it means that it can’t be refiled unless the plaintiff successfully appeals the dismissal.

Equitable Relief. There are several areas in which a small claims court judge has the power to issue judgment for something other than money damages—that is, to order a party to return unique property, end a fraudulent contract, fix a mistaken contract, or do one or more of the acts discussed in more detail in Chapter 4. This type of judgement is called equitable relief (as opposed to monetary relief).

Equity. The value of a particular piece of property that you own. For example, if a car has a fair market value of $10,000 and you owe a bank $8,000 on it, your equity is $2,000.

Exempt Property. Under California law, certain personal and real property is exempt from being taken to pay (satisfy) court judgments if the debtor follows certain procedures. For example, a judgment debtor’s equity in one or more motor vehicles is exempt up to $2,300. (See Chapter 24.)

Formal Court. As used here, this term refers to the regular state courts other than small claims court. In California, claims too large to qualify for small claims court are heard in superior court (Code Civ. Proc. § 86). Even though cases worth $25,000 or less are handled following somewhat simplified limited jurisdiction rules, litigating a case in superior court requires considerable attention to often confusing legal language and procedure, and you will want to do some homework if you decide to bring a case there. If your claim really is too big for small claims court, see Represent Yourself in Court: How to Prepare & Try a Winning Case, by Paul Bergman and Sara J. Berman-Barrett (Nolo), or Win Your Lawsuit: A Judge’s Guide to Representing Yourself in California Superior Court, by Judge Roderic Duncan (Nolo). With or without a lawyer, you’ll find guidance on certain important pretrial procedures in Nolo’s Deposition Handbook, by Paul Bergman and Albert Moore (Nolo).

Garnish. To attach (legally take) money—usually wages or commissions, or a bank account—for payment of a debt.

Hearing. The court trial.

Homestead Declaration. A piece of paper that homeowners can file with the county recorder’s office to protect the equity in their home from attachment (seizure) and sale to satisfy most debts. The equity protected is $100,000 for a family; $175,000 for persons who are over 65, blind, disabled, or over 55 with an income under $15,000 ($20,000 income for married couples); and $75,000 for a single person. A homeowner is entitled to substantial protection even if a homestead declaration is not filed. (See Chapter 24.)

Judge Pro Tem. A lawyer who pinch-hits for a regular judge on a tempo­rary basis. Because this person isn’t an elected or officially appointed judge, he or she can only hear your case with your written consent, which will normally be requested on the day you go to court.

Judgment. The decision given by the court. A judgment must be written down and signed by a judge.

Judgment Creditor. A person to whom money is owed under a court decision.

Judgment Debtor. A person who owes money under a court decision.

Judgment Debtor’s Statement of Assets. An informational form accompanying a notice of entry of judgment that must be completed by the losing side unless the judgment is appealed or paid. This form is designed to inform the winning party about such things as where the loser works, banks, and owns property. (See Chapter 24.)

Jurisdiction. A court’s authority to hear and decide a case. To properly hear a case, a court must have jurisdiction over the type of dispute and over the parties. The small claims courts have jurisdiction over disputes with damages of up to $10,000. Small claims courts have jurisdiction over parties who live in California, were present in California when the dispute arose, or who purposefully do business in California. (For more information about the courts’ jurisdiction over individuals, see Chapter 8.)

Jury Trial. All small claims cases and appeals are heard by judges or commissioners. There is no right to trial by jury in California small claims courts.

Legal Error. A situation in which the judge incorrectly applies the law to the facts. If a judgment is entered that contains a clear clerical or legal error, either party may promptly file a request (motion) with the small claims court asking to have it corrected. (See Chapter 23.)

Levy. A legal method to seize property or money for unpaid debts under court order. For example, a sheriff can levy on (take and sell) your automobile if you refuse to pay a judgment.

Lien. A legal right to an interest in the real estate (real property) of another for payment of a debt. To get a lien, you first must get a court judgment and then take proper steps to have the court enter an abstract of judgment. To establish the lien, you then take the abstract to the county recorder’s office in a county where the judgment debtor has real estate.

Mediation. A process encouraged in many California small claims courts by which the parties to a dispute meet with a neutral person (the mediator) who attempts to help them arrive at their own solution to the problem. If mediation succeeds, it’s normally not necessary to argue the case in court; if it fails, the dispute can still go to court to be decided on by a judge.

Motion to Vacate Judgment. A document filed on Form SC-135 (Notice of Motion to Vacate (Cancel) Judgment and Declaration) by a defendant who did not appear in court to defend a case on the proper date, with the result that the judge entered a default judgment. The motion to vacate judgment asks the judge to reverse the default judgment. After the motion is filed, the parties must usually attend a hearing, at which the judge listens to the defendant’s explanation of why he or she missed the first hearing and then decides whether to set aside the default and reopen the case. (See Chapter 15.)

Order of Examination. A court procedure allowing a judgment creditor to question a judgment debtor about the extent and location of assets.

Party. Lawyer talk for a participant in a lawsuit. Thus the plaintiff or defendant may be referred to as a party—and both together as the parties—to a small claims suit.

Plaintiff. The person or party who starts a lawsuit.

Plaintiff’s Claim. Also called Plaintiff’s Claim and Order to Go to Small Claims Court, this form (SC-100) is filed with the small claims court to start a lawsuit.

Prejudice. A term used when a case is dismissed. A case dismissed without prejudice can be refiled at any time as long as the statute of limitations period has not run out (see Chapter 5). However, a case dismissed with prejudice is dead (can’t be refiled) unless the dismissal is first successfully appealed.

Process Server. The person who delivers court papers to a party or witness. (See Chapter 11.)

Recorder (Office of the County Recorder). The county office that creates and files important legal documents, such as deeds to real property. The county recorder’s office is usually located in the main county courthouse.

Release. A written agreement in which a person agrees to waive a right or responsibility, for example a release of liability.

Satisfaction of Judgment. A written statement filed by the judgment creditor when the judgment is paid. (See Chapter 23.)

Service. The formal delivery of court papers to a party or witness, which must be done in a manner specified by statute. Also called service of process.

Statute of Limitations. The time period during which you must file your lawsuit. It normally starts on the date the act or failure to act giving rise to the lawsuit occurred, and ends one or more years later, with the number of years depending on the type of suit. (See Chapter 5.)

Stay of Enforcement. When a defendant appeals a small claims court judgment to the superior court, enforcement (collection) of the judgment is stayed (stopped) until the time for appeal has expired.

Stipulation. An agreement on any topic relevant to a case, entered into by the parties and then presented to the judge.

Submission. When judges want to delay deciding a case until a later time, they take it under submission. Some judges announce their decision as to who won and who lost right in the courtroom. More often, they take the case under submission and mail out a decision later.

Subpoena. A court order requiring a witness to appear in court. It must be delivered to the person subpoenaed to be valid. (See Chapter 14.)

Subpoena Duces Tecum. A court order requiring that certain documents be produced in court.

Substituted Service. A method by which court papers may be delivered to a defendant who is difficult to reach by other means. (See Chapter 11.)

Superior Court. See “formal court.”

Transfer. The procedure by which defendants can have a small claims case transferred to a formal court if they file a counterclaim for a dollar amount larger than allowed in small claims court.

Trial de Novo. The rehearing of a small claims case from scratch by a superior court judge after a defendant appeals. In this situation, the previous decision by the small claims judge has no effect, and the appeal takes the form of a new trial (trial de novo).

Unlawful Detainer. Legalese for eviction. Unlawful detainers must be brought in superior court, not small claims court. (See Chapter 20.)

Venue. This basically refers to the proper location (courthouse or county) in which to bring a suit and is discussed in detail in Chapter 9. If a suit is brought in the wrong county or court (one that is too far from where the defendant lives or a key event in the case occurred), it can be transferred to the right court or dismissed. If it is dismissed, the plaintiff must refile in the right court. However, the case can be heard even in the wrong court if both parties appear and agree to it.

Wage Garnishment. After a judgment has been issued (and the defendant’s time to appeal has elapsed), the small claims court clerk will issue a writ of execution on the judgment creditor’s request. This may be turned over to a sheriff, marshal, or constable with orders to collect (garnish) a portion of the judgment debtor’s wages directly from an employer.

Writ of Execution. An order by a court to the sheriff, marshal, or constable to collect a specific amount of money due.

How to Use This Book

This guide covers the procedures that both plaintiffs and defendants should use to successfully bring or defend a small claims case in California. Unlike other guides, it also contains step-by-step instructions for preparing particularly common small claims cases, along with real-life examples of cases I’ve observed in small claims courts throughout California.

Chapters 2 and 3 help you answer the basic question of whether you should sue in the first place by asking two crucial questions: Do you have a good case? Can you collect any money from the defendant if you win? If your answer to either of these questions is “no,” then you should read Chapter 6 to see whether you might be able to settle your dispute without going to court, or you should consider dropping the idea of a lawsuit.

Chapters 4–9 walk you through the procedural details. Small claims court is meant to be easy, but it still has rules about how much money you can sue for, who you can sue, what court you should bring your lawsuit in, and so forth.

Chapters 10 and 11 are about the actual paperwork: How do you fill out your papers and deliver them to the defendant once you’ve decided to bring a small claims lawsuit?

Chapter 12 is for the defendant. You’ve just been sued; what do you do?

Chapters 13–15 get you ready for your day in court. In Chapters 23 and 24 you’ll find out how the judge issues a ruling, how to appeal, and how to collect your money if you’re successful.

In Chapters 16–22, we look at the most common types of cases and discuss strategies to handle each. Even if your fact situation doesn’t fit neatly in one of these categories, you should read this material. By picking up a few hints here and a little information there, you should be able to piece together a good plan of action. For example, many of the suggestions on how to handle motor vehicle repair disputes can also be applied to cases involving problems with fixing major appliances such as televisions, washers, and expensive stereos.