The Small Claims court was created to provide a forum for people to obtain legal relief for small monetary claims without the need for formal legal processes. By using a simplified procedure and by eliminating the necessity of applying the technical rules of litigation, the Small Claims court enables a person to bring a lawsuit, without and attorney, for a monetary claim of up to $3000.00, exclusive of interests and costs. In order to bring a claim, the person being sued (defendant) must reside, or have an office for the transaction of business or regular employment, within the town or village that the court is located. The defendant must have a residential or business connection within the particular town or village in which the court sits.

Small claims court is a legal court of law designed to resolve disputes involving small amounts of money in an expeditious manner. Unlike other legal courts, small claims court does not operate by formal rules of evidence, and attorneys are (generally) not utilized. Instead, plaintiffs and defendants simply go before the court and present their respective perspectives on the dispute, and the court makes a judgment based on the evidence presented.

To sue in Small Claims, a person must be 18 years of age or older. If the person suing is under the age of 18, the complaint must be filed by the parent or guardian.

A claim can be filed:

Before going to the court all reasonable measures to realize the amount shall be taken.

The court clerk gives the affidavit and a claim form to file the claim. The form contains the name of the person or business being sued and the amount for which the claim is made.

To prepare for the trial, all papers, photographs, receipts, estimates, canceled checks, or other documents that concern the case need to be collected. It may be helpful to write down ahead of time the facts of the case in the order that they occurred. This would help in making a clear presentation of the story to the judge.

To file a small claims action, the owner needs to first find out if he or she has a case that can even be heard in the court. State limits vary considerably in this regard; some place a ceiling of several hundred dollars, while others will hear claims for as much as $5,000.

Once the business owner has familiarized himself or herself with the basic procedures, he/she should proceed with the filing. The document, known as a summons or complaint, should describe the dispute; the time, date, and location that it took place; names of witnesses (if any); and desired compensation.

The plaintiff should also try to name the defendant as accurately as possible when filing. The legal name of the defendant can be known from the office of the County clerk in the county where the business is located and the legal name that is operates under. If the correct legal name of the defendant is not known, the defendant can be sued by using any name under which the defendant does business.

When the defendant is a corporation, a plaintiff can check with the office of the secretary of state or corporate registration department to obtain the correct address because a corporation must register the name and address where it can be served with legal process.

Once the defendant receives notice of the claim, he or she can either try to reach a mutually satisfactory agreement with the plaintiff prior to the trial date or begin preparing for the case by gathering all favorable evidence available (itemized bills or invoices, written agreements, etc.)

If the defendant fails to appear for trial, the plaintiff will be granted judgment for the amount of the claim proven in court, plus costs--provided the plaintiff can show proof of service.

If the plaintiff fails to appear, the claim is dismissed; however, generally the court will permit the plaintiff to start over, if good cause for the non-appearance is shown.

An appeal can be made to the superior court within the prescribed time limit along with the filing fees.

If the settlement was arrived at through arbitration, the right to appeal may be limited.

Bankruptcy

Bankruptcy is the process where a person legally declares himself or his business unable to pay outstanding debts. Depending upon the type of bankruptcy filed, one meets with a judge to determine a payment schedule, or have a legal bankruptcy discharge most if not all debts. Businesses also may declare bankruptcy, which either means the business will close, or that the business will continue to operate with reduced payments to debtors.

The first step to file for bankruptcy petition involves a conference with an attorney regarding rights, and procedures (although this wouldn't occur if you file bankruptcy without an attorney).

Next is preparing the documents to file the bankruptcy petition. These documents are quite extensive, and can easily involve hundreds of pages. Once the documents are complete, then they must be filed with the U. S. District Court, Bankruptcy Division, in the same area. At this time, you would pay a filing fee, usually around $200.

Once the Court accepts the filing, the creditors will receive a notice from the Court advising of the filing, and when the first meeting will be held. This is called a “Meeting of Creditors." Any of the creditors, who wish to question about the debt, assets, etc., can appear at this meeting. If a creditor wishes to make an objection to filing bankruptcy, they will do it at this time, as well. In most instances, this is the only meeting that will occur for the majority of debtors.

Foremost among the advantages in filing for bankruptcy is the ability of a debtor to get a fresh start by having many of those crippling debts discharged or reduced. Although filing for bankruptcy will negatively affect your credit, trying to pay off debts you are unable to pay, missing payments and delinquencies can have the same affect, and can often affect your credit report for just as long or longer. Filing for bankruptcy may allow you to start all over much sooner and with a lot more peace of mind.

The biggest disadvantage to filing for bankruptcy is the stain it puts upon your credit report, which could affect you from making any major purchases for up to ten years. However, bankruptcy does not always prevent you from getting credit; indeed, a great deal of people who file for bankruptcy is able to get credit lines within three years, though interest rates might be higher.