Big News in Small Claims

Published on: September 1, 2010

Small claims procedure in Massachusetts Courts provides anyone with the opportunity to start an action simply by printing a concise written statement of their claim, and filing it with the district or housing court clerk. The clerk then sends out a certified letter to the Defendant, notifying them of the date (typically 2-4 months from the date of filing) on which the claim will be heard in an informal proceeding, typically before a clerk magistrate. The Massachusetts Rules of Evidence are “loosely” applicable, the court (not the claimant) effects service of the claim, and only upon leave of court would either party be entitled to discovery. In addition, the Plaintiff does not have a right of appeal, but is entitled to recover the filing fee from the Defendant in the event that she prevails on her claim.

On Thursday, August 5, 2010, Governor Deval Patrick signed into law An Act Relative to Economic Development Reorganization (“Act”). The Act is intended to “make the state more business friendly”, and garnered support from every senator and 151 of the 153 congressmen…a very popular law, to say the least. One of the many provisions within the Act, altered the limits and filing fees related to small claims actions. Once capped at $2,000.00, small claims actions for contract and damages claims have now been increased to $7,000.00. The Act sets the fees for the filing of small claims actions based upon the amount claimed. The filing fees range from $30 for claims under $500 to $140 for claims over $5,000. These changes to the small claims procedure are going to be “big”.

Prior to the Act, attorneys were uninterested in small claims court because the stakes were too small to make it worth their time, and magistrates tended to look less favorably upon the small claims player that showed up to the hearing with representation. After all, small claims court was intended to provide pro se litigants with an informal setting to do “their own talking”.

The new $7,000.00 cap and reduced filing fees are sure to spark a lot of interest among attorneys, landlords, small business owners, and various claimants that would otherwise be turned off by the high expenses associated with a civil lawsuit. Why file a civil complaint, when you can file a concise statement of a claim, which the Court will send to the respondent for you?

Following the passage of the Act, District Court Chief Justice Lynda M. Connolly forecasted a significant increase in small claims, and mentioned that this likely spike in small claims cases would come at a time when budget cuts have resulted in a reduced number of magistrates. She further stressed that the new rates and special provisions take effect “immediately”. Why pay a higher filing fee to commence a civil action, when you can pay a fee according to the size of your damages; avoid the intricacies of civil procedure and the rules of evidence; ensure a quick hearing; and circumvent discovery deadlines?

Only time will tell what effect the Act will have on new small claims cases, and the players that will take advantage of the casual procedure and low filing fees. However, one could safely assume that there will be an influx of claimants looking to take advantage of this informal and newly expanded arena within every District Court and Housing Court. It should also be noted that Rule 4 of the Uniform Small Claims Rules will still permit the Court to transfer a small claims case to the civil docket upon request of either party, or upon its own motion.

However, regardless of any possible transfers, the increased limit and reduced filing fees will certainly result in an increased demand for magistrates across the Commonwealth, as the small claims docket becomes “HUGE”.

The relevant sections of the Act are provided below for your review.

SECTION 156. Section 21 of Chapter 218 of the General Laws, as so appearing, is hereby amended by striking out, lines 6 and 35, the following words, “two thousand dollars” and inserting in place thereof, in each instance, the following figure “$7,000”.

SECTION 157. Section 22 of said Chapter 218, as so appearing, is hereby amended by adding the following paragraph:

The procedure shall include the beginning of actions with an entry fee of $30 for claims of $500 or less, $40 for claims of greater than $500 but less than or equal to $2000, $90 for claims of greater than $2000 but less than or equal to $5000, and $140 for claims greater than $5000, plus the surcharge required by section four C of chapter two hundred and sixty two, but without summons and complaint and without requirement, except by special order of court, of any pleading other than a concise written statement of the claim.