Effective August 1, 2013, the maximum limits for lawsuits in small claims court and district court will rise significantly. The small claims limit is doubling from $5,000 to $10,000 and the limit for district court cases is increasing from $10,000 to $25,000. Anything over that amount must be brought in Superior Court. The rise in the small claims limit will significantly increase the number of cases that individuals and companies may bring without the assistance of an attorney, which may reduce the cost of pursuing claims of less than $10,000. A note of caution however – the losing party in any small claims action can appeal to the District Court, which reviews the matter with no consideration of what happened at the small claims stage. At that point, any corporate party must hire an attorney to represent it before the District Court, and all parties will be required to engage in non-binding arbitration before a court-approved arbitrator. This should be an important consideration when deciding whether to move forward in small claims court, whether with an attorney or not – if you believe the party you are suing is likely to appeal any adverse decision to the district court, it may make sense just to begin there yourself, even if the initial costs may be higher.
If you have any questions about handling matters in small claims court, or about navigating the North Carolina court system generally, please feel free to contact us.