Do you really want your day in court?
Ask someone who has been involved in a lawsuit, and the answer might surprise you. Generally speaking, the civil litigation system is not a cost-effective way to resolve small monetary disputes. Even for simple conflicts, the process can be drawn out and expensive, leaving those without significant resources at a disadvantage. Many start out litigation expecting that justice will be served but end up discouraged and having to withdraw their claim or settle it for an amount that would otherwise be unacceptable, simply due to the high cost (and risk) of proceeding to a trial. The saying that you “start out litigation as a pig, but end up a sausage” aptly describes the bitter experience some have had with the system.
Did you know that small monetary disputes can be litigated without attorneys-or attorney’s fees-in the Small Claims Court? Surprising information coming from an attorney to be sure but it’s true. Complex cases or cases involving larger amounts in controversy cannot be handled in this manner but for small matters you might consider this path.
One of the chief misconceptions contributing to the belief that litigation can effectively resolve small disputes arises out of the right to recoup legal fees from your opponent if you win the case. In Florida, the prevailing party of a litigation is entitled to recover his or her legal fees and costs from the opposing party, so long as the litigation was over a contract containing an attorney’s fee provision, or over a right granted by a statute that authorizes such a recovery. But, in reality, the amount of attorneys’ fees that are ultimately awarded to the winner of a lawsuit is usually far less than what actually had to be spent to win that suit. Also, both the judgment and the attorneys fees awarded to that prevailing party still have to be collected – and there is no guarantee that the defeated party can, or will, voluntarily reimburse the victor. Even more money may therefore have to be spent trying to collect these judgments (and you may be throwing good money after bad – it is likely not a coincidence that high profile defendants have moved to a debtor-friendly state like Florida in the face of civil judgments being entered against them). Because of these practical realities, a conscientious attorney will counsel clients to accept otherwise unacceptable settlement offers rather than file lawsuits over small business disputes.
Along with entering displeasing pre-litigation settlements or avoiding lawsuits altogether, another alternative to resolving small monetary disputes is the small claims court. My firm often counsels our community association clients to file small claims court actions for uncomplicated matters such as collection of fines, reimbursement of repairs to damages to the common elements, or reimbursement of expenditures for necessary repairs made to a unit by the Association. The small claims court is set up to avoid the drain on time and resources that often occur in the State Circuit Court. Small claims proceedings can be used by anyone – individuals or corporations – where the amount in dispute is less than $5,000.00. Small claims proceedings are intentionally designed to permit a quick, simple and inexpensive way to resolve small monetary disputes. Unlike in the State Circuit Courts, corporations (including community associations) are allowed to appear in the small claims court without a lawyer. Immediately, this avoids the lion’s share of the cost of a lawsuit – legal fees. As the opposition most likely also will not retain counsel, the risk of having to reimburse legal fees is also avoided.
Self-representation may seem like a daunting task, but there is really no need to fear doing so in the small claims court. While small claims proceedings might not be quite as simple as they appear on television shows such as “Judge Judy,” they are nowhere near as procedurally complicated as ordinary civil lawsuits. In small claims court, there is generally no discovery (such as interrogatories, document requests and depositions) allowed, and the evidentiary rules at the “trial” are significantly relaxed. The process is genuinely designed to permit persons without legal training to proceed without attorneys, and the judges are acutely aware of this and give significant latitude to such persons.
Along with the savings in cost, small claims proceedings also save you time. Small claims do not get bogged down in a judge’s cluttered trial docket as can often occur in the State Circuit Courts. The small claims system is set up to resolve matters within several months, not years. Initially, the case is assigned a pre-trial hearing date, to take place within fifty (50) days of the initial filing. This pre-trial hearing is simply a settlement conference similar to a mediation – where many, if not most, cases are resolved without the need for further proceedings. If the matter does not settle at the pre-trial hearing, a “trial” date is assigned, which by statute is to take place within sixty (60) days.
Although the jurisdiction of the Small Claims Court is limited to matters under $5,000.00, a party can take advantage of this system regardless of the amount at issue so long as they are willing to accept a maximum award of $5,000.00 Such a tactic may be economically advantageous when taking into account the savings on legal fees and the cost of the additional time that would otherwise be incurred if litigating in the State Circuit Court. Obviously, there are some limitations to the small claims system, and we always recommend consultation with an attorney before filing a small claims action. However, this manner of litigating small monetary disputes can be highly effective and should be considered by persons who believe they are owed money but are reluctant to pay an attorney to seek recovery with no guarantee of success.
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