Resolving Disputes in Small Claims Court

Disputes between two small businesses or a business and a customer are also common in small claims court. Most involve a contract. Commonly, a business argues that goods or services were of poor quality, or provided late, or not at all. For example, suppose Ted, an independent graphic designer, sues Tip Top Excavators because it won't pay him for redesigning its logo and newsletter. Tip Top's defense is that because the work was both substandard and late, the contract was broken and no payment is due.

If the parties don't negotiate their own solution or arrive at one through mediation, each would have a chance to present their side of the story to a small claims court judge. A succinct and well-organized court presentation is always important. And in a close case, chances are good that the side with the most convincing written evidence will have the edge.

For example, if Ted can produce a written contract (or other documents showing that a contract existed), a decent-looking sample of the redesigned newsletter, and a letter from someone with expertise in the field stating that the work met industry standards, he will be in an excellent position. Ted would also be wise to prepare to rebut the likely points the opposing business will make. For example, if the design work was a few weeks late, Ted would want to present a good excuse, such as the fact that Tip Top asked for time-consuming changes.

When Ted's presentation is complete, it will be up to Tip Top to back up its version of the story. It will want to present evidence that either the work was delivered so late that it amounted to a serious breach of the contract or that Ted failed to meet other important contractual specifications (designed a 4-color, 24-page newsletter template when the contract called for a 2-color, 12-page job). Again, the more hard evidence Tip Top has (such as a letter to Ted pointing out the project was over deadline and asking for immediate completion), the better Tip Top's chances.