How Does Small Claims Court Work?

Before issuing a court claim, you are expected to send a formal "letter before action" (also called a letter before claim) to the person or business you are in dispute with. This is required under the Pre-Action Protocol for Debt Claims and gives the other side a final chance to resolve the matter without court involvement.

Your letter should clearly state what you are claiming, the amount owed, and a reasonable deadline for response (usually 14 days, or 30 days for debt claims). You should also warn that court proceedings will follow if the matter is not resolved.

Keep a copy of this letter and proof of postage. If you end up in court, the judge will want to see that you attempted to settle the dispute before issuing proceedings.

If your letter before action does not resolve the dispute, the next step is to issue your claim. You can do this in two ways:

• Online via Money Claim Online (MCOL): Available at moneyclaims.service.gov.uk. This is the quickest and cheapest method for money-only claims up to £10,000.
• Paper form N1: Complete an N1 claim form and submit it to your local County Court. This is required for non-money claims (such as wanting goods repaired or replaced) or if the defendant is outside England and Wales.

Your claim must include your details, the defendant's details, the amount claimed, and a brief statement of why you believe the money is owed (called the "particulars of claim").

Once your claim is served on the defendant, they have 14 days to respond (or 28 days if they request an extension by filing an acknowledgment of service). The defendant can:

• Pay the full amount: The case ends and you receive your money.
• Admit the claim (fully or partly): They accept they owe some or all of the money and may propose a payment plan.
• Defend the claim: They file a defence disputing your claim.
• Counterclaim: They claim that you owe them money instead.
• Ignore the claim: They do not respond at all.

If the defendant fails to respond within the deadline, you can apply for a default judgment. This means the court will rule in your favour without a hearing, simply because the defendant did not engage with the process.

You can request default judgment online through MCOL or by filing form N225 (for a specified amount) or N227 (for an unspecified amount) at the court.

If the defendant files a defence, the court will send both parties a Directions Questionnaire (form N180). This form asks about your case, any witnesses, whether you need an expert, and your availability for a hearing.

Based on the questionnaire responses and the value of the claim, a judge will allocate the case to the appropriate track. Claims up to £10,000 will normally be allocated to the small claims track.

The judge will also issue directions - instructions about what each party must do to prepare for the hearing, including deadlines for exchanging documents and evidence.

For most small claims, the court will offer free telephone mediation through the Small Claims Mediation Service run by HMCTS. This is a one-hour phone call with a trained, impartial mediator who will try to help both parties reach an agreement.

Mediation is voluntary, but courts strongly encourage it. If you unreasonably refuse to mediate, the judge may take this into account when deciding on costs. Many disputes are successfully resolved at this stage, saving both parties the time and stress of a court hearing.

If mediation succeeds, the agreement is legally binding. If it fails, your case continues to a hearing.

If mediation fails or is not suitable, the case will proceed to a hearing. Small claims hearings are informal compared to other court proceedings. They typically take place in the judge's private room (called "chambers") rather than a formal courtroom.

The judge will ask both parties to explain their case, look at the evidence, and may ask questions. You do not need to follow formal court procedures - the judge will guide the process. Most hearings last between 30 minutes and an hour.

After hearing both sides, the judge will make a decision (called a "judgment"), usually on the same day. In straightforward cases, the judge may decide the case "on paper" without requiring either party to attend in person.

Winning your case does not automatically mean you will receive payment. If the defendant does not pay the judgment amount voluntarily, you will need to take enforcement action. Several options are available:

• Warrant of Control: County Court bailiffs attend the defendant's address to seize goods to the value of the debt.
• Attachment of Earnings: Money is deducted directly from the defendant's wages.
• Third Party Debt Order: Money is taken directly from the defendant's bank account.
• Charging Order: A charge is placed on the defendant's property, meaning you get paid when the property is sold.