- Finance
What all freelancers should know about small claims court
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It’s every freelancer’s worst nightmare…
You start a project for a new client. They seem fine. They contact you often (sometimes TOO often), and they’re clear with you about what they want. Finally, after weeks or months of work, you finish the project, wait for your payment...but it never comes.
Months pass. All of your emails, letters, and increasingly-angry voice messages are ignored, and your once all-too-present client has now vanished into the ether.
You’ve tried everything. So what do you do? If you’ve exercised all available options, one way to get their attention is to take them to small claims court. Here’s what you should know:
What is small claims court?
Small claims court is a venue for resolving relatively small disputes over money and, depending on the state, other issues.
Do I need a lawyer?
Whether or not you can represent yourself depends on your state of residence. If you’re required to hire a lawyer (or just prefer to do so), be sure that the cost of paying him or her doesn’t exceed the amount that you’re looking to recover.
Sometimes hiring a lawyer will be enough. Once the client receives that first phone call from your lawyer, they’ll know that you mean business, and in a lot of cases you’ll receive payment shortly thereafter.
Who can I sue?
There may be regulations regarding where you can sue, and those questions should be directed to the small claims court clerk in your area. If you can only sue in the defendant's state of residence or business, and that’s not your state, it could add dramatically to the overall cost.
How much can I recover?
The amount that you can recover varies by state, but generally tends to be between $3,000 and $10,000. Unfortunately, if you’re owed more than the maximum recoverable amount, you can’t break a large payment into multiple parts and seek to collect on more than one. So if you’re looking to recover larger amounts, this is probably not the right solution for you.
So if I win, I get the money automatically?
Unfortunately, no. It’s not all that simple. If the client doesn’t immediately pay up, you’ll have to pursue the payment...and as you may have guessed, this process requires more time and more money.
Is there anything else that I should know?
Regardless of whether you hire a lawyer or not, you’re going to need something to persuade the judge. This could be copies of your contract, invoices, a deal memo, letter of agreement, photos, witnesses, or any other written/spoken communication with the client.
Also, don’t wait too long. Different states have specific statutes of limitations on how long you have to bring a lawsuit.
Where do I find all of the information on small claims courts in my state?
Get online, type “small claims court” and your state’s name into your browser, and look for official government websites ending in .gov or .us.
Freelancers, have you ever taken a client to small claims court? What was your experience?
Disclaimer: If you have any concerns about small claims court or any other specific legal issues, contact an attorney. This article is meant as an informational guide, not legal advice. You can find freelance-friendly lawyers in the Freelancers Union App.