How to Settle Out of Small Claims Court
Small claims court is a convenient method of resolving disputes involving small amounts of money---in most jurisdictions, $2,500 or less. After you file your claim, you will be assigned a hearing date and be required to serve the person or business you are suing with your claim and the hearing date. After having been served with your claim, the other party may contact you to try to settle the case before the hearing date. If you can agree on a settlement, there are a few steps you should take to effectuate the out-of-court settlement.
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Instructions
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Discuss with the other party, either in person or by phone, the terms on which you would be willing to settle your small claims case without having to go to court for the scheduled hearing. Once you and the other party have agreed on a settlement amount, set a time to meet with each other to obtain the payment.
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Meet with the other party and obtain the settlement payment. With your case settled, you must file a dismissal form with the clerk of court prior to the scheduled hearing.
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Obtain the appropriate form to dismiss your small claims case from the clerk of court's office. You can also check the court's website regarding the availability of the form via downloading.
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Prepare the dismissal form for filing by filling in all the identifying information about your case, such as the case number, court name, and names of parties. Because your settlement has fully resolved the dispute, indicate on the dismissal where appropriate that the case is being dismissed in its entirety, with prejudice.
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Mail a copy of the dismissal form to the other party at the time you file it with the clerk of court.
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Tips & Warnings
Always take advantage of an opportunity to settle your case. There is no certainty that you will win at the hearing. Also, even if you do win, the other party may appeal the decision and get your win reversed.
With a settlement payment in hand, you do not have to worry about collecting a judgment.
The other party may want you to provide the executed dismissal form in exchange for the settlement payment. This is a reasonable request, so long as the settlement payment is in the form of cash, money order or cashier's check. You don't want to have the other party's check bounce on you after you have already provided the dismissal.
