Your day in court
By Melanie Chambers • Bankrate.com

Using the Hell's Angels to recover an unpaid bill would have been more effective than going to small claims court, says one woman.

Leslie Smith, a freelance writer in Toronto, sued a client for $350 for an unpaid writing assignment a couple years ago. But after spending almost $750 on document fees, parking and other incidentals, she started to wonder if it was worth it.

"I'm only half-kidding when I say hiring a couple of Hell's Angels would have been far cheaper and easier," she says.

That's the rub with small claims court -- there is no guarantee that the time and effort you put into a legal battle won't cost you more in the long run.

But if you've been ripped off, you don't have to live with the results. Thanks to small claims court, you can take matters into your own hands and redeem some or all of the lost money. To decide if justice is worth the effort, read on.

What is small claims court?
Small claims court is a less formal branch of the provincial courts and the larger Superior Court of Justice. The judge is usually a lawyer, and in most cases you represent yourself. The court hears cases concerning $10,000 or less, although the limits vary slightly from province to province.

They can involve a contract or oral agreement between you and another party. You can sue for auto accident or property damage, some landlord tenant issues, bad cheques, unpaid wages and consumer-related issues such as poor workmanship.

Because small claims court is less formal, you do most of the legwork. You file the original claim, photocopy your own forms and even collect your own money, should you win your case.

You can find the local small claims court in the blue pages of your phone book. Keep in mind that if the person you are suing lives in Thunder Bay, Ont., and you live in Toronto, you must sue in Thunder Bay.

Where to begin
To start, write a letter of demand to the person you wish to sue, otherwise known as the defendant. If you can come to an amicable decision before it reaches court, all the better because you save yourself time and money.

If you can't work things out, file a notice of claim to start the ball rolling. The filing cost varies from province to province, but you can generally count on paying between $80 and $100.

In most provinces, the defendant has about 30 days to reply (14 days in British Columbia) before legal proceedings get started.

Before heading to court, check your provincial government's Web site, which will explain in detail what to do and where to go. If you need further explanation or your case is complicated, hire a lawyer for a consultation, which costs between $100 and $150 an hour.

When Holly Quan, of Calgary, took her landlord to court when he refused to cough up her damage deposit, her dad hired a lawyer. "I probably could have figured out the process on my own, but to have someone coaching me on what to say and how to present the information was a big help," she says.

But if you use a lawyer, keep in mind she will expect about half of whatever money the court awards you.

Plan for a long haul
Expect your legal proceedings to take about one year from start to finish. While the courtroom part of that time can be fairly short, what takes the most time and effort is gathering documents.

Besides asking the court for the money you are owed, you can also claim interest on it in most cases. "When you go to court and win, the judge will ask when you sent your first demand letter or when you filed your claim," says lawyer Bram Lecker, of Lecker and Associates in Toronto. "Interest starts ticking from that date."

To determine the interest rate, the Court of Justice Act sets out a quarterly rate, which is prime plus one percent, says Lecker.

If you win, the defendant must pay your legal costs to a maximum of $500. That's why you should think twice about retaining a lawyer. If you sue for a few thousand dollars and the legal fees start to mount, most of your win will get handed over to a lawyer.

If the defendant fails to show up in court, you automatically win a default order, "unless the absent party can show cause why he/she cannot attend or proceed," says Lecker.

You win, but...
If the defendant isn't prompt with payment, it's your responsibility to find out information about his assets -- i.e., bank account, occupation and property -- to present to the court. If the defendant isn't forthcoming with the information to you, he can reveal his assets to the court if he prefers.

If he refuses to pay, the court can put a lien against any property or belongings and even garnish wages to recoup your win. That's what happened to Quan, whose landlord didn't pay the final judgment.

"My lawyer suggested putting a lien on the property, which we did. Eventually, when the mortgage came up for renewal, the landlord had to pay me before he could renew the mortgage."

Winning in small claims court is hit or miss. Quan was lucky when she sued, while Smith is still awaiting a judgment after two years.

"In the end, whether you get your money back or not is just a crapshoot, and I can see why so many people don't bother pursuing an issue through the courts," she says.

But if the fire is in your belly and you are determined, knowing how the system works will help you see that justice is served.

Melanie Chambers is a writer in London, Ont.