Before October 2017, if you asked any trial lawyer in North Carolina whether a company could represent itself in court, the answer would have been “Only in small claims court.” Most lawyers would have even been able to tell you the exact case that required companies to have an attorney represent them in court. That rule meant that if your company was sued in small claims court and won, the plaintiff could appeal to District Court and essentially require your company to hire an attorney to defend the case in the District Court. So, even though your company had not been the one to start the litigation and won before a magistrate, you would still have to spend the extra money to hire an attorney to represent you in District Court. That struck some people as unfair, including apparently some North Carolina legislators. Effective October 1, 2017, a new provision of North Carolina’s General Statutes exempts a company involved in an appeal of a small claims action from the requirement of hiring an attorney to represent it in District Court. The new law is North Carolina General Statutes Section 7A-228(e).
Unfortunately, however, it appears that some lawyers (and even some judges) may not yet be aware of the new statute. We have gotten recent reports of company representatives being told that they cannot represent the company in district court, even on appeal from a small claims decision. Therefore, if you do choose to try to represent your company, you should plan on coming with a copy of the statute and, even then, being prepared to be told that you need to hire an attorney. Of course, the question of whether you should have an attorney representing your company in district court is much different than whether the law requires you to do so. Many lawyers put a lot of faith in the old saying that a lawyer that represents himself has a fool for a client and would therefore recommend that anyone involved in the court system should have an attorney, with the possible exception of small claims court. Because of the availability of a new trial in district court, the consequences of making a mistake in small claims court are significantly reduced. Once your company is in District Court, however, the stakes can become much higher. Even if you do choose to act as your company’s lawyer (and the judge allows you to do so) you may be well-served in at least discussing the matter with your attorney first.