Updated on
Author: Sergei Lemberg
Can I Sue a Collection Agency in a Small Claims Court?
![Small Claims Court Lawsuit]()
General Rule: Yes. However, there are limitations in small claims court, such as the amount of damages they can award.
When a collection agency manages your account, they will send various types of communication about your debt. Certain collection agencies may be very aggressive in attempting to collect the debt. However, there are certain lines a collection agency cannot cross.
This is because all consumers are protected under the Fair Debt Collection Practices Act (“FDCPA”). This federal law provides a framework for how debt collectors handle these accounts. This includes how they communicate with you, what information they provide and more.
If you are dealing with a collection agency, you must be aware of these potential violations. If there is a violation, you then have options on how to address the situation. One of those options is filing a lawsuit in small claims court.
This article will provide guidance on when to consider a lawsuit in small claims court. It will also provide other options if a small claims court will not effectively resolve your situation.
Reasons You Can Sue a Collection Agency
The first thing you need to determine is whether there was a violation of the FDCPA. While there are many potential violations, they fall into a few categories. They are as follows:
➜ Deception. This includes misrepresenting your debt, who they are, false threats and other forms of deception.
➜ Harassment. A collection agency cannot call at odd times, repeatedly or use profane language. These are just a few of many examples of harassment.
➜ Publicizing Your Debt. A collection agency cannot tell others about your debt to embarrass you or coerce a payment. This includes telling a third party or publishing your name on a debtor’s list.
When To Sue in Small Claims Court
Suing in small claims court has a lot of advantages. Small Claims Courts are set up to allow individuals to represent themselves without an attorney. Typically, the form to file a lawsuit is brief and provides detailed instructions. These courts are also usually helpful in helping you understand how to serve the complaint on the collection agency.
Another advantage of small claims court is how quickly a case can progress. In small claims court, you will likely get a court date quicker than filing in state court. This ultimately means a quicker resolution of your case.
There are a few potential disadvantages to consider when filing in small claims court. Those include:
- Amount of Damages. While each state is different, there is a cap on how much you can receive in damages. If your damages exceed this amount, you may need to consider alternative options.
- Preparing Your Case. Typically, people represent themselves in small claims court. You will be responsible for determining what type of evidence you need and presenting it to the court.
Alternative Options to Small Claims Court
It may be that your damages are higher than the limit set in your small claims court. Or maybe you prefer not to file a lawsuit alone or at all. There are other options to consider. Here are some ways you can resolve an FDCPA violation without suing in Small Claims Court:
- Contact the Collection Agency Directly. In some cases, you can quickly resolve a situation by writing to the collection agency about the violation.
- Sue in State Court. With this option, you do not have a cap on the amount of damages you can request. However, the process is more complex and it will likely take longer to resolve. If you choose this option, consider hiring an attorney to represent you.
- File a Report with a Federal Agency. You can submit a complaint to the Federal Trade Commission (FTC) for FDCPA violations. You may also send a general complaint to the Consumer Financial Protection Bureau (CFPB).
- Negotiate a Settlement of Any Outstanding Debt. In some cases, you may be able to use an FDCPA violation to your advantage. A collection agency does not want a bad reputation or a guilty verdict in court. They may agree to a steep discount if you choose not to file a lawsuit.
Conclusion
There are many different options if you have a collection agency that is violating your rights. Small claims court is a great option if the damages are not too high. You can represent yourself and get a quick resolution.
However, you may be unsure whether this is the best option for you. You always have the option to request a consultation with a consumer rights attorney. They can help you determine the best course of action.
About the author:
Sergei Lemberg is a consumer rights attorney, practicing since 2006, whose practice focuses on consumer law, class actions and personal injury litigation. He is known for a United States Supreme Court case (Facebook v. Duguid) defending consumers from autodialers under the Telephone Consumer Protection Act of 1991 to send unsolicited text messages. He is also the author of Defanging Debt Collectors, a book that teaches consumers how to battle debt collectors and win.
See more posts from Sergei Lemberg