Max amount pay in small claims court when sued for $500?

Question

I am being taken to small claims court in Utah for $500. If I was to lose what is the worst case situation? It sounds like I might have to pay the $100 filling fee. Is that true? Would I have to also pay any of their legal fees?

Answer 1

The judge has the right to order that you pay the court and legal fees, but he doesn't have to.

If you make an agreement to pay the person you owe, most judges will accept that.

Answer 2

Section 78A-8-102 of the Utah Statutes states in the pertinent part:

(1) A small claims action is a civil action:

(a) for the recovery of money when:

(i) the amount claimed does not exceed $11,000 including attorney fees, but exclusive of court costs and interest; and

(ii) the defendant resides or the action of indebtedness was incurred within the jurisdiction of the court in which the action is to be maintained[.]

So, if you are sued in small claims court for $500, the worst case scenario is that a judgment for $11,000 plus court costs is entered against you with interest on the judgment at the statutory or contractual rate.

Court costs includes filing fees, service of process fees, photocopying costs and printing costs and supply costs for exhibits used in the process, and potentially costs incurred after judgment to collect the debt from you such as fees paid to a sheriff to seize property to pay the judgment, or filing fees for a garnishment and related service of process fees. Court costs also includes the fees charged by expert witness fees and lay witness fees (along with service of process charges) for witnesses compelled to attend by subpoena. Usually court costs are on the order of $100-$300 in a small claims court case like this one. But, if the plaintiff hired an expert witness and won, that would be considerably more.

Whether attorneys' fees are awarded depends upon whether an attorney was employed by the Plaintiff and the nature of the transaction. Attorneys' fees are not allowed in the U.S. except when an exception to the general rule of no attorneys' fees, called the American Rule applies. Some of the most notable exceptions that could apply in small claims court are for contractually provided attorneys' fees (pretty much every written contract with a consumer has one), for groundless and frivolous claims or defenses, and for certain kinds of lawsuits authorized by statute (e.g. certain consumer protection claims and fair debt collections practices claims, and civil rights claims).

Of course, even if attorneys' fees are awarded, the attorneys' fees must be reasonable, and a $10,500 fee to collect a $500 claim is unlikely to be viewed as reasonable, and if no attorney is employed, then there are no attorneys' fees. Often a $500 claim would be brought in small claims court precisely because it wasn't cost effective to hire an attorney.

The worst outcome that is very likely is that you might have a judgment entered against you for $500, $300 of costs or so, and $1500 or so of attorneys' fees and/or expert witness fees, so perhaps $2,300.

But, worst case scenarios do happen, and attorneys' are always allowed for both parties in small claims courts in Utah. See Small Claims Court Procedure Rule 13 ("A party in a small claims action may be self-represented, represented by an attorney admitted to practice law in Utah, represented by an employee, or, with the express approval of the court, represented by any other person who is not compensated for the representation.")