It comes as no surprise that today's challenging economy has resulted in many unpaid bills for real estate and other professionals. In most cases, these professionals were careful to require a portion of payment from clients up front before beginning any work.
However, as the economy has worsened, many professionals are finding their clients refusing to pay for their services, leaving some real estate representatives in a quandary: either walk away without receiving full payment or find an economical way to collect on the balance. Many times, the amount at issue is small enough to be handled through a small claims court with little to no outside assistance.
The phrase "small claims court" is likely to elicit a scene from Judge Judy or The People's Court. Many people wrongly assume small claims courts are more entertainment than a real-life venue to have serious disputes settled. However, for those who are in need of a place to have a minor dispute decided, small claims court presents an attractive option.
Cases Eligible for Small Claims
In Washington state, small claims courts are referred to as "courts of limited jurisdiction" because only cases with claims less than $5,000 may be filed in this venue. This excludes claims involving title to land, or attempts to seek a form of equitable relief under the law. In addition, similar to lawsuits filed in District or Superior Court, small claims court rulings may be appealed.
Filing Your Small Claims Case
Filing a case in small claims court is a fairly easy process thanks to the court's pre-printed forms. However, there is more involved than simply filling out the paperwork, arranging for service of the lawsuit on the other party and awaiting your court date. Before filing your case, you should consult a legal professional to ensure that you put your best case before the judge. While attorneys are generally not allowed to appear in small claims, they can assist you and help you prepare for your hearing.
Some of the advice you are likely to receive is to create a chronology of your case. Include key dates, such as when payment was due, or when you were told that the deal was off. After creating a timeline of key events, gather up all of your written evidence and assemble it in the same chronological order.
If necessary, prepare a separate spreadsheet or document outlining any commissions, additional charges, taxes, or fees that may need more explanation during the hearing. Your goal is to try to make things easy for the judge to track and follow as you present your case. Preparation and organization are the keys to presenting a solid case.
Conclusion
While no one relishes the thought of taking legal action, knowing all of the options available helps one to make an informed decision and prepare accordingly. Understanding the small claims process and how to present your best case are invaluable tools for today's real estate professional.
Phil Haberthur is an attorney in the Vancouver office of Northwest regional law firm Schwabe, Williamson & Wyatt.
