Dollar limits for suing in small claims court raised in September, 2012
Governor Snyder recently signed legislation changing the Michigan Small Claims Courts maximum jurisdictional amount in controversy from $3,000 to $5,000. This means you can sue for up to $5,000 in small claims damages.
The increase went into effect on September 1, 2012. The jurisdictional limit will periodically increase up to $7,000 by January 1, 2024.
The increase benefits everyone. I realize no one really likes having to hire lawyers, and it is particularly exasperating when the cost and fees of hiring a lawyer is going to match or surpass the amount you can sue for and recover. So this benefits both businesses and individuals.
Businesses should see savings on the cost of litigation on loan defaults, small fraud, nonpayment and collection cases, and other smaller claims that can be filed in small claims court without a lawyer. Individuals save money on litigation costs when for example, the contractor never shows up. Instead of having to hire a lawyer to handle claims above $3,000, businesses and individuals will now be able to present a case on their own to the judge without having to hire a lawyer.
As a lawyer, I think that’s great. Too many lawyer jokes out there as it is!
Here’s my lawyer’s caveat: Remember that despite the increase in the jurisdictional limit you can sue for, in order to proceed in small claims court, the consent of both parties is needed. If one party does not want the case to proceed in small claims court, then that party can have the action removed to the district courts. And that means you will still need to hire a lawyer. Unfortunately, many bigger companies (Comcast anyone?) will do this to browbeat and intimidate aggrieved individuals, and it is a huge advantage when a corporation already has in-house lawyers but an individual has to hire a lawyer if a case gets removed.
But it’s a good start, and it’s an improvement over the way it’s been.
Costs for small claims court in Michigan