July 12, 2012

How to Pursue Delinquent Owners in Small Claims Court

Owners in condominium and homeowners associations unfortunately do not always pay their assessments.  When that occurs, associations have many collection options available to them.  Most of those options involve hiring an attorney, but Seattle-area community associations can also pursue delinquent owners on their own by filing small claims in King County District Court.

If your association wants to file a small claim against a delinquent owner, then the first step in that process is to submit a notice of small claim form to the court.  The fee for filing a small claim is currently $35.  The court will add a case number and trial date to the notice of small claim and send two copies of that document back to the association.  Trials are typically scheduled between 40 and 90 days after the claim is filed.

The second step in the small claim process is to serve the completed notice of small claim on the delinquent owner.  Process service must take place at least 10 days before the scheduled trial date, and this can be accomplished by the sheriff's office, a professional process service company, or by certified mail with return receipt requested (as long as the owner signs the return receipt). 

The third step in the small claim process is to appear in court on the trial date.  If a mandatory mediation does not result in a settlement, then the trial will proceed.  A member of the association's board of directors must present its case at the trial.  Consulting an attorney in advance can help to ensure that the association's position is presented properly. 

While the small claim process can be a useful collection tool, associations should also be aware that it has significant drawbacks.  First, small claim judgments cannot exceed $5,000.  Second, associations’ ability to collect judgments will be limited by the amount of owners’ personal assets and wages that can be located and garnished.  Third, judgments will not prevent owners from continuing to reside in or lease their homes without paying assessments.  Fourth, board members must take time out of their busy schedules to travel to court and appear on the association’s behalf.  Despite those drawbacks, pursuing a small claim can be the best course of action in certain circumstances, particularly when the debt and the association’s legal budget are small.  Discussing the available collection options with an attorney can help associations decide if the small claim process is the right way to seek collection of unpaid assessments.          

The King County District Court’s website is an excellent resource if your association wants to learn more about pursuing small claims.