Someone owes you up to RM5,000 and refuses to pay? Here’s how to drag them to Small Claims Court, no lawyers needed!
One misconception many in Malaysia have is that disputes between individuals will more often than not end up in a protracted legal battle in court and will cost you a ton in legal fees. Hence, when there are monetary disputes — say a friend owing you money and refusing to pay, or a company not paying you for a freelance job — many decide not to pursue legal action as they think it’s not worth the hassle and legal fees.
Well, this is far from the truth, as the Malaysian judicial system actually provides a simplified and cost-effective legal process to resolve money disputes of up to RM5,000, with no lawyers needed!
Aptly named the Small Claims Court, it is a specific kind of court that hears cases between an individual plaintiff and a defendant whereby the amount claimed doesn’t exceed RM5,000. An alternative to the regular court system, the Small Claims Court is meant to avoid the need for lengthy and expensive lawsuits, making justice more publicly accessible and affordable.
So, how does the Small Claims Court operate, and how do you file a case for any applicable grievances you have? Well, join us as we break it down below.
Small Claims Court and its procedures
In a Small Claims Court hearing, the case will be heard and decided by a Magistrate, with the procedures governed by Order 93 of the Rules of Court 2012.
Furthermore, neither the plaintiff nor the defendant is allowed to be represented by legal counsel, except where the defendant is required by law to be represented by an authorised person.
The Small Claims Court presides over several types of civil claims for remedies, damages or compensation, which include and not limited to:
Loans
Contract dispute
Property or motor vehicle damage
Personal injury claims
During a Small Claims Court hearing, the plaintiff must prove their claim against the defendant by producing witnesses and tendering documentary evidence. Accordingly, the defendant can also file their defence and any counterclaim, if any, in response.
While neither party can be represented by a lawyer, they can still seek legal advice from legal professionals when pursuing or defending a small claim. However, they are strictly required to be self-represented during the hearing.
Both parties can also opt for a settlement during a hearing, and if this option is taken, the Magistrate may direct parties to enter into a consent judgment, which is a decision made with the consent of all the parties.
At the end of the hearing, the Magistrate will make their decision to either allow or dismiss the claim. Most importantly, the Magistrate’s judgement is final and neither party can appeal to a higher court. The Small Claims Court may also award costs not more than RM100 to any party.
How to file a small claim case
For the plaintiff, in order to file a small claim case, you need to follow these procedures:
Go to the nearest Subordinate Court Registry and ask for the Small Claim form, i.e. Writ in Form 198
Prepare 4 copies, and please ensure that your form and claim are duly completed
Submit the completed form to the Subordinate Court’s Registry
The court will inform you of the hearing date
The Plaintiff must serve the sealed Writ on the Defendant and file the
Affidavit of Service. The fee is RM8.00
Meanwhile, for the defendant, these are the procedures to follow:
After being served with the sealed Form 198 from the Plaintiff, go to the nearest Subordinate Court Registry and ask for the Small Claim form. i.e. defence and counterclaim (if any) in Form 199
File your defence within 14 days from the date of the service. Failing to file a defence within 14 days from the date of service or failing to attend the small claim hearing, the judgment will be entered against you, and the plaintiff will get a judgment sum as claimed
Here are the relevant fees applicable in filing a small claim case:
Small Claims Court judgments and their enforcement
As per Order 93 of the Rules of Court 2012, in a case where the defendant fails to file their defence within 14 days from the date of service, the Court may enter a judgment against the defendant, and vice versa for an absent plaintiff. Moreover, the Plaintiff must file a judgment and serve it personally on the defendant (Rule 8).
Rule 8 further prescribes that in the event the defendant is absent during the hearing, the Court may enter a judgment against him and when the Plaintiff is absent, judgment may be entered against him.
Besides that, the defendant has a right to apply for the judgment or order to be set aside by filing the Application for setting aside judgment or order (Rule 10).
Meanwhile, Rule 16 establishes that if the person against whom the judgment is made (“Judgment Debtor”) has not complied with the said judgment, the Court may, after receiving a notice to show cause from the winning party, give orders to:
Order a writ of seizure and sale to the Judgment Debtor
Allow the Judgment Debtor time to settle the judgment debt or pay the debt by instalments
Order the Judgment Debtor to be committed to prison
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