Key Takeaways:

  • Small claims court is often the most efficient and cost-effective way to handle breach of contract disputes involving smaller sums of money.
  • Breach of contract claims require proof that a valid contract existed, the other party breached it, and the breach resulted in financial damages.
  • State laws vary on small claims court limits, procedures, and allowable damages, so understanding local rules is crucial.
  • Remedies in breach of contract cases can include monetary damages, specific performance, or contract cancellation and restitution.
  • Defendants can raise defenses such as fraud, misrepresentation, or failure by the plaintiff to perform their part of the agreement.
  • Proper preparation, including organizing documents, contracts, invoices, and witness testimony, significantly increases the likelihood of success in court.
  • If collecting a judgment is difficult, additional legal steps such as wage garnishments or bank levies might be necessary.

Suing in Small Claims Court

Small claims court lets you bring smaller claims before a judge without costly fees. It's a simple, inexpensive, and relatively quick alternative to a lawsuit.

Some common reasons to file a claim in small claims court include:

  • Recover a security deposit from a landlord after you vacate the property.
  • Recover unpaid rent after a tenant vacates a property.
  • Recover for medical bills after an injury accident.
  • Recover for repaired, damaged, or destroyed personal property.
  • Recover from a small unpaid debt.

You must determine whether or not your claim meets jurisdictional requirements. Each state has a maximum monetary limit, which ranges from $2,000 up to $10,000. If your dispute exceeds the maximum, you may need to file in a superior court.

Before your hearing date arrives, gather all documents that support your claim. Documents may include letters, memos, photographs, canceled checks, and receipts. Bring several copies with you to court, and make sure you organize them.

Understanding Small Claims Court Limits and Jurisdiction

Each state imposes a monetary limit on small claims court cases, typically ranging from $2,500 to $10,000, with a few states allowing higher limits. These limits determine whether your breach of contract claim qualifies for small claims court. Filing a claim that exceeds the maximum may lead to dismissal or transfer to a higher court. Additionally, small claims courts often have jurisdiction only over monetary disputes, not cases seeking specific performance or injunctions.Before filing your breach of contract case, verify the following:

  • The maximum claim amount in your state.
  • Whether your case involves monetary damages or non-monetary remedies.
  • Residency requirements for both parties, as you may need to file in the defendant’s local jurisdiction.

How to Sue Someone for Breach of Contract

When one party fails to perform a task as promised or if something occurs to make it impossible for one party to perform as promised, a breach of contract occurs. When preparing your case, keep these aspects in mind:

  • Determine if you have a valid contract. The contract is a written or oral promise. Oral contracts are more difficult to prove. Some contracts must be in writing. These include marriage, real estate transactions, property transfers after a death, debt repayments, goods valued over $500, and agreements that last longer than one year.
  • Determine if a breach of contract occurred. This happens when one party fails to provide goods or services to someone else.
  • Figure out if you fall within the statute of limitations. All states have their own time limits, whether based on circumstances, agreement type, or where you file the claim. You can typically find your state's information online. The timeframe begins once you realize a breach occurred.
  • Determine if the breach caused damages. The law states that prior to suing for breach of contract, the breach must have resulted in financial loss.
  • Take note of all damages. Keep records of monetary damages you experience.

Once you prepare your case, you can begin to file your lawsuit. There are also some tips to remember:

  • Figure out if you can go to small claims court. If the amount is less than the limit in the state where you file suit, you can file in small claims court instead of the county civil court. However, you cannot appeal the verdict.
  • Investigate state laws on serving the opposing party. You must provide the other party with a lawsuit notice and give the other party a chance to respond. Giving notice is another name for serving.
  • Get a complaint form. You must prepare a complaint document that you file with the court. Each state has its own form, so make sure you have the correct one and fill it out accurately. Make at least three copies of the form.
  • File your complaint. You must type the forms and include information such as the names and addresses of each party, a statement explaining why the court has jurisdiction, a description of the contract, an explanation of how the defendant violated the contract, and damages suffered.
  • Wait for a summons. The court will issue a summons, which includes the lawsuit's file number, names of parties, and instructions that the defendant should follow. The defendant must also receive this document.

Types of Breaches in Small Claims Court

Understanding the nature of the breach is critical to building your case. Breaches typically fall into these categories:

  • Material Breach: A significant failure to fulfill a contract term, resulting in harm to the other party. This often justifies terminating the contract and seeking damages.
  • Minor Breach: A partial failure or deviation from the contract that does not fundamentally undermine its purpose but may still result in financial harm.
  • Anticipatory Breach: When one party signals, before performance is due, that they will not fulfill their contractual obligations.
  • Actual Breach: When one party outright fails to perform their part of the agreement as required.

Identifying the type of breach can help frame your argument and support your request for appropriate damages.

Remedies Available in Small Claims Court Breach of Contract Cases

Winning a small claims court breach of contract case can result in several types of remedies:

  • Monetary Damages: Compensation for direct financial losses due to the breach, such as unpaid invoices, repair costs, or the cost of hiring a replacement contractor.
  • Restitution: Reimbursement to restore the plaintiff to the financial position they were in before the breach.
  • Cancellation and Rescission: Terminating the contract and relieving both parties of further obligations, often coupled with restitution.
  • Specific Performance: Although less common in small claims court, a judge may order the breaching party to fulfill their contractual duties in certain cases (e.g., delivering a unique product). However, this remedy is typically reserved for higher courts.

Understanding the potential outcomes can help you determine what to seek when presenting your case.

Tips for Presenting a Contract Claim in Small Claims Court

One of the most common types of claims filed in small claims court is a breach of contract, also known as a breach of contract cause of action. When filing one of these claims, follow these tips:

  • Organize your claim to establish liability, and then focus on damages.
  • Establish liability through the existence of a contract, and then focus on breach of contract evidence.
  • Use evidence to establish damages pertaining to breach of the contract.

Common Defenses to a Breach of Contract Claim

Defendants in small claims court breach of contract cases often raise defenses to counter a plaintiff’s claims. Some common defenses include:

  • Lack of Contract Formation: Arguing that no valid contract existed, possibly due to lack of mutual agreement or proper consideration.
  • Performance Excused by Plaintiff: Claiming that the plaintiff waived performance requirements or excused the defendant’s obligations.
  • Breach by Plaintiff: Asserting that the plaintiff failed to fulfill their obligations under the contract, nullifying the defendant’s performance duty.
  • Fraud or Misrepresentation: Alleging that the contract was induced by false statements or deceit.
  • Impossibility or Impracticability: Demonstrating that unforeseen circumstances made fulfilling the contract impossible or excessively burdensome.
  • Statute of Limitations: Arguing that the claim is time-barred under the state’s statute of limitations for breach of contract claims.

Preparing for these potential defenses can help strengthen your case and prevent unexpected setbacks.

Collecting a Judgment After Winning Your Case

Winning a small claims court breach of contract case is only the first step. Collecting the awarded judgment can be challenging if the defendant is unwilling to pay. Consider these steps if you encounter difficulties:

  • Demand Payment: Send a formal written request for payment, referencing the court’s judgment.
  • Wage Garnishment: In some states, you can garnish the defendant’s wages to recover the judgment amount.
  • Bank Levy: Seek a court order to freeze and withdraw funds from the defendant’s bank account.
  • Lien on Property: Place a lien on the defendant’s property, preventing its sale until the judgment is paid.
  • Renewing the Judgment: Judgments typically expire after a certain period (e.g., 10 years), but you may renew them if payment remains outstanding.

Consult your local court’s website for specific procedures and requirements related to judgment collection.

FAQs

1. What types of contracts can be enforced in small claims court?

Contracts involving services, sales, leases, loans, and other common agreements can be enforced, provided they do not exceed the state’s monetary limit.

2. Can I sue for emotional distress in a breach of contract case?

Generally, small claims courts award only monetary damages for direct financial losses. Emotional distress is not typically recoverable unless tied to fraud or other tort claims.

3. What happens if the defendant doesn’t show up to small claims court?

If the defendant fails to appear, the judge may issue a default judgment in your favor, provided you present sufficient evidence to support your claim.

4. How long do I have to file a breach of contract claim?

Each state imposes a statute of limitations, often ranging from 2 to 6 years, depending on the type of contract and local laws. Filing beyond this period may result in case dismissal.

5. Can I bring a lawyer to small claims court for a breach of contract case?

Some states permit attorneys in small claims court, while others encourage self-representation. Review your state’s rules, and if permitted, consider consulting an UpCounsel attorney for legal guidance.

If you need help on suing for breach of contract in a small claims court, you can post your legal need on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Menlo Ventures, and Airbnb.