Collecting Through Small Claims Court

It’s no secret that when some owners fail to pay their assessments, other members must struggle to pick up the slack unless and until the delinquent owners can be made to pay up. There are several options available to the Association to try and collect; imposing late fees, taking away amenities and/or voting rights, placing a lien on the property and foreclosing on these liens. While each of those remedies has its advantages and disadvantages, another option available to the Association is to file a claim against the delinquent owner in small claims court or municipal court. Small claims court provides an expedited, cost-effective way for the Association and a delinquent owner to “have their day in court.”

A small claims case starts with a Complaint, prepared by the Association attorney and filed with the municipal court, detailing that the delinquent owner has an obligation to pay the Association, that they have failed to do so, and that they owe the Association for unpaid assessments and costs. On the date of the small claims hearing, a representative of the Association, either a Property Manager or Board Member, will accompany an attorney from our office to Court where the Judge or Magistrate will hear testimony with regard to the delinquent owner’s obligation to pay, and how much is owed to the Association. The Judge or Magistrate will then normally make a ruling and issue a judgment in favor of the Association.

If the Judge or Magistrate rules in favor of the Association, the Association may use the judgment obtained to garnish the delinquent owner’s wages, or attach bank accounts or personal property.

There are limits to small claims court, though. Each small claims court has a jurisdictional limit that they are unable to award a judgment in excess of $3,000. Civil actions in municipal court have a judgment range of $3,001 to $15,000 But if you are faced with an owner whose delinquency is relatively low, and are looking for a cost-effective, expedited way to potentially obtain a judgment outside of the foreclosure process, then the small claims process may be the answer.

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