The Fine Print: No Justice In Small Claims Court

The following is not legal advice. Contact Alexander Bachuwa, a New York attorney, at BachuwaLaw.com if you have an inquiry. 

When I first started writing The Fine Print series, I received comment after comment about the advantages of small claims court over arbitration. I pushed back and argued that consumer arbitration provides aggrieved claimants with a better chance of receiving relief. After beating Citi in one arbitration case, settling another, and fighting the likes of eBay, Dell, and everyone in between, I am still convinced that consumer arbitration is an effective tool for fighting corporate mischief.

Still, not every claim can be brought in arbitration. Others have to be adjudicated in small claims. For example, I had an issue with British Airways that did not have an arbitration provision. I filed that in New York Small Claims and the case settled. Counting on that positive experience, I took on another case against an airline hoping for a swift, equitable resolution. I detailed the play-by-play of my first time in small claims First-Hand Tutorial Guide.

Where We Were

Here’s the quick recap: I went to small claims. The airline’s lawyer did not show up. Instead, he sent a lawyer to appear on the airline’s behalf and ask for an adjournment. I spoke to that lawyer and gave him my contact information in the hopes that the airline would reach out to me to discuss the matter. They did not. Instead, my client and I had another court date scheduled. Since neither of us could be there, I paid for an attorney to appear on our behalf and ask for another adjournment. I also knew that the airline had to send its lawyer to court. Otherwise, a judgment could be found in our favor for the airline failing to appear. The lawyer did appear, and I contacted him about the status of the case. He said that there was no way that the airline was going to settle.

The Trial Date

Months later, the trial date had arrived. There would be no more adjournments. Justice would be served that night. Only it wasn’t. Here’s why: The airline’s lawyer would not agree to arbitrate the matter. Instead, he insisted that the judge preside over the hearing. This posed two problems: 1) We were #25 on the docket which meant that there was no chance that we would go before the judge that night. 2) Small claims, especially in New York, frowns upon two lawyers fighting it out in front of the judge. If you take the airline’s lawyer at his word, he said that there would be no way that the court would allow me to litigate this case on behalf of my client.

Meanwhile, right down the hall, the express train to justice was immediately available for those that would go before an arbitrator. I tried my best to convince the airline’s lawyer to choose this expeditious route. He demurred and stated that he wanted the right to appeal should we prevail at trial, an option unavailable in arbitration. Beyond annoyed and out of options, my client agreed to reschedule the trial for a future date.

Where We Are

If we want to go forward, my client has to return to small claims, deal with the DMV atmosphere, all in the hopes that he will be heard by the judge. It is likely that the docket will be full again, and the parties will have to agree to postpone it again. Groundhog’s Day will continue until the backlog is cleared and my client finally has a chance to present his case. If he does not appear throughout this ridiculous process, his case will be dismissed. If he does appear, most likely it will be without the aid of his attorney because I cannot spend my life in small claims, and I may not even be welcome to advocate on his behalf if I am in attendance. To make matters worse, even if he does win, it is likely that the airline will appeal and the nightmare will continue.

What This Means

There is no justice in small claims court. It is another ruse. While big companies can afford to send out their lawyers to postpone these cases by waiting it out until dismissal, the average consumer does not have the time to waste on such matters and will give up on the process. If the consumer’s day in court does arrive, the consumer still has a small shot at justice. This may be because the respondent refuses to go through the arbitration process and stalls the process interminably by insisting on a trial before a judge. That could take months. This may be because the client has to represent himself because the state does not allow lawyers in small claims. Now the consumer has to devote time and energy to understand the small claims process and present a lucid, logical argument as to why he or she is entitled to relief. If the state does allow for lawyers in small claims, it is a certainty that the judge will be impatient in dealing with two lawyers fighting over a dispute worth a few thousand dollars at the most.

Disillusioned, most consumers will not file a claim. Resultantly, companies continue to get away with questionable conduct.

Consumer Arbitration Is No Panacea

While the experience in small claims was frustrating for me and my client, it does not mean that the alternative, consumer arbitration, is always the answer. There are instances where small claims may serve a purpose e.g., if you have infinite time and are infinitely angry. Like small claims, consumer arbitration has many provisions that companies manipulate so that the claims are never arbitrated. The only certainty is that companies will do anything and everything they can to avoid liability. That does not mean that we should stop fighting. It just means that we have to be more cunning and, unfortunately, more patient. That is a tall order given our constraints on time and their limitless resources.

 

 

 

About Alex Bachuwa

Alexander Bachuwa is a New York attorney who focuses on consumer protection. He is also a BoardingArea blogger. Contact Alex at through his website at bachuwalaw.com and visit thepointsoflife.com

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    • It does but according to the defendant’s lawyers, lawyer vs lawyer is a nonstarter for the judge. I didn’t get to see what the judge would say because we didn’t have the chance to present our case.

    • I believe I have a right to be up there but the respondent said that the judge would never let it happen. I’m not sure what that means. What I do know is that judges in small claims do not like lawyers because it is supposed to be a pro se ‘friendly’ process and lawyers muddle it up by being lawyers. An angry judge may not have the patience to hear lawyers argue legal theory for hours while there are dozens of cases to be heard.

  1. Well, at a glance consumer arbitration may seem the better choice. But you need all parties agreement to settle it in arbitration. Some contracts may stipulated any dispute shall fall under arbitration jurisdiction, some are not. To each their own counsels opinion, whereby the consumer have no chance to negotiate the contract. It is a given. Take it or leave it (buy or get service or whatever somewhere else). Tough lawyers are sometimes the most creative creature, their creativity often limited by the nominal amount of the case. Thus, small claims find it hard to pursue justice. And the story continues, whereby peasants cannot hope to have justice against nobles…..

  2. @Rob
    Afaik the consumer can. But compared to the (small) claim, how much the client shall paid the lawyer for service rendered?

    • It’s a contingency fee. I do not charge unless we win or settle. Otherwise, no one could afford a lawyer for such small matters.

  3. The only time I ever filed a case in small claims court was in Western Pa. The district justice, who isn’t a judge or attorney, and often only has a 2 week course to qualify for the position, refused to hear the case. I agree that small claims court isn’t always a good idea.

    • Refusing to hear the case is a common problem. Cases may be dismissed because an unrepresented plaintiff does not understand the procedure or the court doesn’t understand the process.

      • Are you serious? Judge of small claim courts only got short course to decide justice and settle disputes? Moreover cases can be dismissed because court didn’t understand the process (bys dismissing I also assume the court refuse to try to understand). Then what the court actually do for seeker of justice?

        • I’m no expert in small claims. My only experience has been this claim, British Airways, and landlord/tenant. Obviously, some people get justice in small claims but there are many anecdotes of small claims gone bad, especially when it is a claim against a big company.

  4. I’ve had mostly good luck with cases I’ve taken to small claims court. Admittedly, the companies I’ve sued were not multi-million dollar corporations. But even when a lawyer bumped up a case of mine from small claims to a more official court, I prevailed. Agreed that you do need time, patience, and a well documented claim.

  5. Good luck and keep fighting. I had a positive experience in New York small-claims court (even though my lawyer dad said not to expect much help) when I sued CompUSA for failing to honor an extended warranty. We tried to arbitrate but I was having none of their offers (the best of which was to fix the computer and refund the warranty, but I had already bought a new computer). We were the last case to go before the judge that day and he awarded me what I hoped for — half what I paid for the old computer plus a full refund of the warranty.

    So I was lucky to be in and out in one day. I wonder if an unheard case gets any priority on the docket the next time — it seems unfair if luck of the draw puts it last again just because they ran out of time.

    Seth

    • It does get priority but the backlog has to be cleared first. Eventually, it will be at the top of the calendar. By that time, the plaintiff may not be able to make it or has given up on the process.

    • The small claims court in NYC has defendants info state as “NY”. I have a fraudulent merchant which did not provide me any services. The Citi Banks credit card legal address is 701 East 60th Street North Sioux Falls, South Dakota 57104. I’m not sure how to fill the defendant information as I live in Manhattan (New York, NY) and the small claims court in NYC has defendants info default state set to “NY”. Any suggestions? Thank you!!!!

  6. I filed in Small Claims when Chase once canceled all my cards and took my points. Small Claims is all about mediation and there is no reason for a bank to take a hard line, especially when the equities are not in their favor. They agreed to immediately transfer all my points to miles.

    From a financial standpoint having to hire an attorney is very costly to the other party. Usually much more costly than just agreeing to do what is right.

    • Yes, but they provide you a specific reason for your account closure? Or did they tell you that you are account can be closed at anytime? If it’s the latter then they may have broken the law. Your case may have been stronger than just points which may be why they settled.

  7. “While big companies can afford to send out their lawyers to postpone these cases by waiting it out until dismissal…”

    Except they can’t. Big Law charges $400+ per hour (usually +++). It doesn’t pay for the airline to put too many hours of attorney time into a case that is worth a few thousand dollars.

    • 1. Once a company decides to go all the way, they do not care about legal expenses. See my Citi arbitration victory linked above.

      2. For small claims, they don’t send in big law. They send in a sole practitioner who is on retainer. That lawyer’s practice is centered around small claims so he or she is always there.

  8. Sorry to hear that! So in the end you filed to dismiss your own case?

    I agree with what Rob said: if BA gets a lawyer, your client should too. As I’m sure you know, courts that prohibit lawyers require a non-lawyer regular employee to represent the company to make it a fair fight.

  9. I’m a lay person, but nothing really precludes you from serving them in a higher court in the first place, right?. Other than higher filing fees if you lose.

  10. I do agree it’s not going to be worth it for most people. Just the trips down to the federal or state courthouse to file all the motions and responses would require missing a lot of work.

    On the other hand, small claims in a much smaller urban area is not nearly as crowded, and the airline probably won’t have in-house counsel just sitting around waiting to fight it.

  11. My experience is quite different. Whole I usually practice is Federal Court and Supreme Court (general jurisdiction court in NY), I have had nothing but success in small claims, albeit with a small sample size of four or five cases, but all of which settled, one on day of trial.

    Only one got removed to federal court, but that, too was settled.

    And, as far as you buying that nonsense respondent fed you about the judge “not having” two attorney cases, come on you’re better than that 🙂

    • I was skeptical of him which is why I said said you take him at his word. I do know from my NY lawyer colleagues that going before the judge is not the way to go. That’s why I was hoping for arbitration. You comment validates the title of the post. Mr. Sly lawyer making stuff up. What happene d to ethics?

      • I do believe making the judge uncomfortable is not the best way to start a day with him/her. But I also believe that lawyer tends to use things only when it benefitted them, including ethics. When situation says otherwise, first comes to mind would be, like what penalty will I suffer? Surely you knew better….

        • Obviously, I do not think there is a penalty. You are getting lost in the weeds. The point is that I could not hear the case that day and as I wrote above, I’m not going to go to small claims again and again because I do not have the time.

  12. The attorney fees for large corporations being represented in small claims courts are not cost effective. Many cards rporations settle for nuisance value of several thousand dollars just to dispense with frivolous claims. Thus, Many people would say that these forums favor the pro se litigants bringing ridiculous claims. I personally think this is a more accurate view.

  13. The small claims court in NYC has defendants info state as “NY”. I have a fraudulent merchant which did not provide me any services. The Citi Banks legal address is 701 East 60th Street North
    Sioux Falls, South Dakota 57104. I’m not sure how to fill the defendant information as I live in Manhattan (New York, NY) and the small claims court in NYC has defendants info default state set to “NY”. Any suggestions? Thank you!!!!

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