Ohio Consumer Law Blog

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Ohio Increases Small Claims Money Limits, Helps Consumers Avoid Arbitration


Nearly everyone has heard the story of David and Goliath.  David, a very small man, was able to take-out a much larger foe, Goliath.  In September, a new law took effect in Ohio, allowing consumers to take on a corporate Goliath in larger cases than previous allowed in Small Claims courts.  This change in the law increases the potential reward for consumers, increases the risk and stakes for corporate Goliaths, and takes away one of the key weapons corporations use to avoid liability:  arbitration.

For the past few decades, Ohio Small Claims courts could generally only hear and decide cases involving disputes of $3,000 or less.  Due to a recent change in the law, which became effective on September 28, 2016, Small Claims courts can now decide cases where a party is seeking up to $6,000.  The law effectively doubled the claim value for lawsuits that consumers could bring under the Consumer Sales Practices Act.

Small Claims courts are an important tool for all everyone.  They were created to be a speedier, less expensive avenue for deciding smaller cases.  There are fewer formal rules that litigants and parties need to follow in small claims, and fewer strict rules of what is able to be used and considered as “evidence” by the court.  Instead of having to call and pay an expert witness to testify about the damage done to your vehicle and the cost to repair your vehicle (likely required in Common Pleas courts), you can sometimes simply provide a Small Claims court with a repair estimate or bill, saving yourself many hours and hundreds of dollars in witness expenses.

While Small Claims court was designed to make lawyers less necessary, you should still contact an attorney about your small claims case.  First, your case may not be small, at all.  Due to the possibility of damages being tripled, non-economic damages being awarded, and statutory damages being added, even on the average consumer lawsuit, a case you think is valued at only $6,000 could be worth $23,000 if filed in a different level of court.  A lawyer can help protect you from filing your claim in the wrong court.  Second, if you are suing a corporate Goliath, you can be sure that they will have a high-priced attorney, even on small cases, who is looking to take advantage of your lack of legal knowledge.  It is a good idea to try to speak with an attorney before filing a Small Claims lawsuit.

In addition to being able to sue for more money in a faster court, there is another, larger benefit to Ohio consumers in this change to the Small Claims court monetary limits.  It might help you avoid a tool used by corporations to limit your rights and limit your recovery:  arbitration.

Due to the speedy and limited liability involved in Small Claims cases, many companies wrote exceptions for cases filed in Small Claims into their arbitration clauses.  To see more about arbitration, and why it is traditionally bad for consumers, check out this article and this article.  For example, companies that include the widely used American Arbitration Association (“AAA”) consumer or commercial arbitration clauses in their contracts with consumers allow for claims to be filed in Small Claims courts instead of in arbitration.  A larger Small Claims jurisdiction means a smaller chance of being forced into arbitration with the AAA or other arbitration forums.

Now that the monetary jurisdiction of Ohio Small Claims courts have increased, consumers can file more and more cases in court, albeit a Small Claims court, than they could before.  Consumers in many cases can avoid what is, in my opinion, to be harmful and expensive arbitration by filing their consumer claims in Small Claims courts in many cases.  This is not possible in every case–there are arbitration clauses that do not exempt or exclude Small Claims cases.  However, for many consumers and many arbitration clauses, the increased monetary claims in Small Claims courts can eliminate the fear and limitations of arbitration on larger claims.

Before you file a demand for arbitration, or feel forced into arbitration, contact a consumer attorney, and see if your claim can instead be brought in the (Not So Small) Small Claims courts.

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This entry was posted on October 3, 2016 by in Ohio, Uncategorized.

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