How to win without going to a small claim court

How do you win a small claim in a small claim court? One short answer is to avoid it altogether. 

You can be a winner by resolving your dispute before you enter the small claim court. Litigation is not easy and you may lose or you may not recover the full amount you are seeking.

Here's some winning ways of settling your small claim before going to a small claim court:

Step 1: Offer to compromise

Contact the person you are pursuing a small claim with. Try to work matters out. A willingness to compromise is not a sign of weakness but a sign of intelligence. A small compromise may allow you to settle the matter right away. People often refuse to settle matters because they have never been asked to. Just ask!

An offer of compromise, made either orally or in writing, doesn't bind you to that amount if the compromise isn't accepted. But your correspondence should be marked 'without prejudice'. For example, if you tell your adversary that you will accept £1,500 of the £1,750 you feel is due, you can still issue proceedings for the original £1,750 if the offer is rejected.

Once you reach a compromise, put your agreement in writing. This way avoids confusion about the terms of your oral agreement, and you will have proof of the settlement if there are any later problems in collecting.

If you cannot reach a compromise, also put this in writing. This will show your good faith in attempting to settle rather than going to a small claim court. Some judges appreciate this effort.

Step 2: First demand letter

The sole purpose of a demand letter is to resolve the problem. Write your letter tactfully and don't alienate the other party. Be firm but polite. For instance, if you own a business, your letter should gently remind a forgetful debtor of his overdue bill. There is no need to be hostile.

Your demand letter should be brief and set out the relevant facts of the dispute. Present your small claim case logically. Write the letter so that it briefly reviews the entire dispute. Include in your letter your reply to any points the other party is likely to make. It may seem odd to recite facts to someone who already knows them, but you are not really just writing to your adversary. The small claim court may eventually see your letter, so you want to state your position in a way the judge can most easily understand it. Remember, the judge doesn't know how your problem started or developed. Your letter may be the only way the judge becomes familiar with your position.

Your demand letter must say that if you don't get satisfaction, you will go to the small claim court. Set a time limit for resolution but don't threaten. When setting time limits always make them clearly identifiable, i.e. seven days from the date of the letter. Make the issuing of a claim form your last resort.

Step 3. Telephone calls

A telephone call is an alternative way of settling your small claim. Calls can produce positive results because they are difficult to ignore, and often people may be more inclined to work out some type of payment arrangement there and then.

Speaking to your adversary may also help to resolve the matter amicably by giving them a chance to voice their reasons for not paying you. But to succeed your telephone calls must be reasonable and businesslike, not harassing or abusive.

Step 4. Use successful settlement methods

To get paid without making a small claim requires some basic understanding of the collection methods that do work. Here are a few pointers:

  • Start by demanding payment in full.
  • Encourage the debtor to make the first offer of settlement.
  • Negotiate for instalments.
  • Try for security.
  • Request that the problem be resolved.
  • Make the settlement sound appealing.
  • Send a confirming letter referring to your discussions and stressing the date you expect payment.
  • Does the debtor belong to some type of association or professional body who can put pressure on him or her to pay?
  • Ignore lame excuses.

And remember it saves everyone time and money if you can settle without the small claim court.

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Published on: February 1, 2006

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