Small Claims Court increases claim amount limitations

Published 4:00 am Wednesday, August 5, 2015

Small business owners and others hoping to file claims in Small Claims Court are no longer limited to the $3,000 jurisdictional limitation any longer.

Pike County Circuit Clerk Jamie Scarbrough announced the limitation raise from $3,000 to $6,000 for Small Claims court after Act 2015-224 was put into affect Aug. 1, which will allow businesses, banks or individuals to sue in the Small Claims Division of the court for a greater amount while still paying smaller court costs.

“This just opens up small claims for the small business, for the banks, for individuals,” Scarbrough said. “It’ll open it up for them to be able to file without going into the Civil District jurisdiction, which sometimes requires the hiring of an attorney. It’s basically so they don’t have to hire an attorney to collect debts for small businesses or banks or anybody else, any individual that wants to file.”

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The fees for filing for $1,500 or less have remained the same at $53. The costs of filing for claims ranging from more than $1,500 to $3,000 has also remained unchanged at $127. Those wishing to file claims for the new bracket of more than $3,000 to $6,000 will pay a filing fee of $216, which is still less than what they would pay in attorney fees in higher courts.

Scarbrough also said that business owners or individuals may file claims for free online at Alafile, the Alabama Unified Judicial System’s electronic filing system, which could potentially save money and time for those wishing to file claims.

“I would encourage users and businesses to utilize Alafile,” Scarbrough said. “It’s free to use that service, and they can actually file claims directly from their offices. They don’t even have to drive up here to file it anymore. There is a four percent convenience fee with filing online, but that is collectible in their judgment.”

While Scarbrough said she wasn’t sure the immediate impacts of the change in limitation would bring for small business owners in Pike County, she said she truly felt it was a great thing for smaller businesses and individuals hoping to collect debts.

“I think it’s just great for the business,” Scarbrough said. “We see a lot of times where businesses will cut themselves short and file claims for $3,000 just so they can stay within the small claims court. It would be cheaper for them to sometimes cut themselves short rather than hiring an attorney to represent them. This is really going to help out small business owners and the banks that collect on some of their smaller accounts and overdraft fees.”