Wednesday, February 29, 2012

Problems With Marion County's Small Claims Courts

This evening I attended the task force meeting in Pike Township reviewing the operation of Marion County Small Claims Courts.  I was able to speak briefly about problems with the courts and suggestions. Here is my followup letter to Judge Baker who chairs the task force:


Dear Judge Baker and Members of the Small Claims Court Task Force:

Thank you for appearing at the Pike Township Government Center and allowing members of the bar and the public to have input into possible changes with the Marion County Small Claims Court.  As one of the few attorneys who attended who is not a collection attorney, I think I can give a different picture of how things are going on.

I wanted to expand a bit upon the comments I made at the meeting.

FORUM SHOPPING:  Make no mistake, attorneys, in particular collection attorneys, are forum shopping in our small claims court.  There is an enormous incentive for them to keep big filers happy lest the township lose the income that comes to through the filing fees.  I remember when I ran in a vacancy election for Pike Twp Small Claims Court in the early 1990s, the Pike Township Trustee told me I should not rule against the big filers more than rarely lest they go somewhere else.

Decatur Township has often been complained of as being friendly territory for collection attorneys.  It doesn't help that they do not have a bus line down there.  That is the township I talked about the case my law firm had a defendant 10 years earlier had a medical bill of about $350 that went to collections. The medical provider received a judgment and at pro supp, the court ordered that the man’s be garnished to pay the $350 bill.  A decade later he was hauled into court on a pro supp proceeding on the same judgment.   Even though the debtor was represented by counsel and the collection attorney had no evidence that the garnishment didn’t fully satisfy the judgment, the court ruled against the client.  He paid it again.

I frankly did not understand their objections regarding venue and the Fair Debt Collection Act.  A collection attorney who spoke near the end clarified that this is apparently no longer an issue as it possibly was at one time in Cook County. Given modern technology, I do not buy that it is that difficult to tell which township a defendant lives in.  Regardless, you could just have a rule that the case gets automatically transferred if its filed in the wrong township, without penalty to the plaintiff.

The thrust of the testimony seemed to be that the small claims court defendant can ask for a change of venue to their home township.  My reading of Rule 12 is that a small claims court venue change is not mandatory…it’s discretionary with the court.  Some of the collection attorneys indicate that in all their years people rarely ask for a change of venue. That is because they do not know they can make that request.   The fact is these are very unsophisticated litigants.

SATISFACTIONS OF JUDGMENT:  What is noted above could have been avoided with the filing of a satisfaction of judgment.  I cannot emphasize enough the problem with courts not demanding that Plaintiffs file satisfactions of judgments on cases.  This month I had a case in nearby county where eight years earlier a landlord in a trailer park had sued my client for rent.  She agreed to give the landlord the trailer in full satisfaction of the judgment.   Because there was no satisfaction of judgment, a collection attorney eight years later filed another pro supp proceeding to collect on the original judgment. 

I can guess what was going on.  That collection attorney had gone through the court files looking for any cases where judgments were entered, and there was no satisfaction of judgment filed, and made a deal with the creditor that she would pursue it in return for a portion of what was collected.   Ironically that same day I was in a Marion County Small Claims Court and the judge there mentioned that a collection attorney had spent the day going through the files, undoubtedly looking for judgments not shown as satisfied.  Because a judgment can remain alive for at least ten years, it iseasy to pursue unsophisticated litigants who leave court thinking everything is resolved and will be taken care of, and then find out years later the final paperwork was never filed showing the judgment was satisfied. 

SMALL CLAIMS COURT JUDGMENT DOCKET AND NEED FOR UNIFIED COMPUTER SYSTEM:  One of the collection attorneys mentioned that the Marion County Clerk has a small claims court judgment docket.  I reviewed the rule and that it is indeed the case that the court is to send their judgments in to the Marion County Clerk. I have to wonder though if it is done on a regular basis – do they physically mail the judgments to the Clerk?  Nonetheless, that is just the judgments.  All filings in small claims court need to be viewable in the Marion County Clerk’s system.  Right now, if you want to know what’s filed on a case, you have to go out to the individual township or call. 

Thank you so much for your interest in working to make improvements to the Marion County Small Claims Court.  It is much appreciated.


Downtown Indy said...

Great blog template, by the way!!!

Paul K. Ogden said...

Thanks, DI. I think it is easier to read.

Irishking23 said...

Paul, I commend you on what you wrote drawing from your own experiences in Marion County Small Claims Courts. Many of those courts have been absolutely disgraceful in their operations and practices. The average Joe or Jane has just been run over by debt collectors not knowing what their rights really are and/or how to assert them. I was in one Township Small Claims Court yesterday and asked if they provided a Litigants' Manual to assist non-lawyer litigants in the process. I was told "No".

Try to get a panel of three judges appointed after a Small Claims Court judge steps down from a case. That is a struggle and a half. In fact it may be impossible.

Paul K. Ogden said...



I've never tried to get a change of judge in Small Claims Court, but I imagine that would be a problem. I'm not sure it's worthwhile from my client's perspective, because they can always pay $150 and get the judgment wiped away and the plaintiff has to refile in Superior Court. Sometimes a small claims court trial is a good opportunity to do a practice run through the evidence.

Irishking23 said...

I realize the economics of most small claims cases do not justify a costly battle. However, there are principles involved in some which are too valuable to simply toss aside. Laying down one's arms in the face of judicial error can only serve to bolster a broken system.
If a judge in a small claims cases who recuses himself fails or refuses to appoint a 3 judge panel as required by Trial Rule 79.1(G, then it could be worth a shot taking a Mandate action directly to the Indiana Supreme Court. The Supreme Court needs to see real cases on how the small claims courts are working or, rather, not working.

Irishking23 said...

When I read what one Marion County Township Small Claims Court judge said to a reporter I almost flipped. He was quoted as saying something like "I am sick and tired of hearing the feeble protests of debtors." How can the Indiana Supreme Court right that kind of judicial mentality? Well, I am sick and tired of being in Small Claims Court when I shouldn't even be there. It's been a eye opener indeed.

Irishking23 said...

How do you find out if a car is broken? You test drive it. How does one find out if the Marion County Small Claims Courts are broken? You test it.

Geoff Granfield said...
This comment has been removed by the author.
Geoff Granfield said...

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Concerned Tax Payer said...

Debt Collectors back to their old bag of tricks. This time the attorney lied and took advantage of a woman who's child was being seen at Riley Hospital for Children.
Copy of a womans experience with Decatur Small Claims Court and Derek F. Johnson of Jacob, Hammerle, and Johnson Law Office.

Woman's Story:
“12/13/12 initial court hearing for unpaid medical bill $397.00. Did not know about the bill I had signed letter from a different Attorney (not Derek Johnson) that the hospital inadvertently did not inform him or client about the bill at that time. The hospital also admitted to the mistake. I met Johnson in a room outside the court room. I informed Johnson that my son was being seen at Riley Hospital and was scheduled to see an Oncologist and I just didn't have any money. Told him I could pay the bill that was all when I got my tax check in Feb. Johnson gave me a paper and said just sign this. I asked the Attorney if he would dismiss the Judgment if I signed the paper. He asked me if I could pay by 2/9/13 $870. I said I would try as this is about the time I would get my tax check in Feb. Again, I asked him if he would dismiss the Judgment he said, "Yeah whatever, just sign the paper." I signed the paper but asked the Attorney to put it in writing that he would dismiss the judgment if I paid by 2/9/13. He refused. I said, "It's my right to get any deal in writing and get a copy of it." He refused again. I said, "I want to see the Judge because you're not doing something honest here." He stormed out and went into the court room. I told the Judge about the deal he tried to make but the Judge wouldn't listen. I told the Judge about my son and that I didn't have the money except to pay the bill. I begged them both. Derek Johnson LIED to the Judge and said Johnson said he didn't offer any deal or say he would dismiss anything. Then Derek Johnson said something to the Judge like "evidentiary/evidence hearing." I said to the Judge and Derek Johnson I was trying to be honest that i owed the bill and Mr. Johnson was not. I said in open court I would pay once I got my tax ck Feb. Judge agreed. On 1/9/13, Derek Johnson filed for non-payment. Only 11 business days after the Judge gave me the Judgment and not enough time to get a tax check. He CHARGED me more fees. Total $999.”

Anonymous said...

It's not just Small Claims courts in Marion County. Some of these practices highlighted here happen all over Indiana. I heard about a collections attorney who fell foul of a judge in a relatively small county. The judge did not approve of the attorney's hourly rate, and limited him (and all other attorneys filing at that court) to a maximum hourly fee). The attorney simply made up the difference, adjusting the paperwork by adding hours "worked" on the case.

I do see another side to this however. There are indeed many, many debtors who refuse to pay, or pay exceedingly little towards judgments. It's easy to understand a judge's exasperation at people who continually hold the court in contempt by not paying judgments as ordered. There has to be responsibility on the debtor's side to know what they owe and who they owe, ALWAYS come to court, and use the opportunity to ask questions about the debt and the judgment and well, fight their corner. Many of these debtors simply ignore the problem until a bench warrant is issued, and by then it's way too late to start talking down the amount you owe.