By Bob Hunt
Its purpose is to help REALTORS®and their clients prepare and present a case in small claims court.
Over the course of a career, a real estate broker or agent may ﬁnd himself in small claims court in connection with a dispute arising out of a real estate transaction. He may be there as a defendant, as a witness, or even as a plaintiﬀ. Sometimes, he may be involved just in an attempt to help a client, even if he doesn’t have a role as a witness.
While small claims court may lack some of the trappings and formalities of higher venues, it can be intimidating enough to those who are not “regulars.” Moreover, its procedures may be such as to confuse and/or hinder even those with a meritorious case to present.
Thus it is that the Small Claims Court Assistance Manual for REALTORS® and Their Clients can provide valuable assistance to members of the California Association of REALTORS® (C.A.R.). The manual was created by the C.A.R. legal staﬀ. Its declared purpose is “to help REALTORS® and their clients prepare for and present a case in small claims court.”The rules for small claims courts vary from state to state. In California, as of January 1, 2012, small claims court jurisdiction is up to $10,000. Small is bigger than it used to be. Even if a plaintiﬀ is owed, or thinks he is owed, more than $10,000, he can choose to waive his rights to the excess and proceed in small claims court.
Suppose there is a dispute over a $15,000 earnest money deposit. The plaintiﬀ could waive the $5,000 excess over the court’s jurisdiction. It is understandable why someone might want to do this. The case will be heard in a much shorter time frame than would be likely in a higher venue. Also, in small claims court, there are minimal legal costs. That is because, with very limited exceptions, attorneys are not permitted to represent a party in a small claims court action.
The C.A.R. small claims manual is designed to provide help for typical real estate–related small claims matters. The ﬁrst chapter provides an overview of small claims court. The second chapter is titled “General Advice Applicable to all Claims; Preparing and Presenting Your Case.” This consists of such down-to-earth suggestions as the following:
Create a folder with tabs, so that if the judge wants to see, for example, the purchase agreement, he or she can quickly ﬂip right to it. The easier it is for a judge to ﬁnd and view a document, the more likely that judge will actually examine it . . .
Watch several cases before going to court.
State the most important part of your case ﬁrst and follow up with your key points.
Deﬁnitely do not interrupt the judge. When the judge begins talking, you stop talking. Don’t attempt to talk over the judge. The judge can interrupt you, but you cannot interrupt the judge!
Chapters 3 through 6 of the manual address a variety of scenarios. They are grouped around four categories:
- Chapter 3—Claims by a listing broker for compensation
- Chapter 4—Claims by a buyer for return of a deposit or damages
- Chapter 5—Claims by a seller for release of a deposit or damages
- Chapter 6—Defenses by a broker against claims made by a buyer
The scenarios have a sample opening statement, a list of suggested documents, a list of the relevant forms or clauses, and a list of supporting legal authorities for the position that is being taken. The appendix of the manual contains the relevant forms and documents, as well as the legal authorities or cases. They are not just citations; they present the opinions. This appendix is more than two hundred pages long.
C.A.R. members can access the small claims manual at the legal section of the organization website, CAR.org. It can be downloaded, or one can just use the link. The manual is a valuable member beneﬁt.
Bob Hunt is a director of the California Association of REALTORS® and is the author of Real Estate the Ethical Way. His email address is firstname.lastname@example.org.