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Can I sue in small claims court for more than the debt, either interest or hardship?

Menifee, CA |

I did a large function (service) for a large hotel chain. They were suppose to pay the day of but said they had mailed the check the day before. When I did not receive it I called and they said it would go in the mail. A week went by and I still did not receive a check. I called the director and hotel manger, and email about the problem. The "director of finance" wrote me an email and said he mailed me a check 5 days ago, a check that should have taken one day to get to me and still no check. It looks like I will have to sue but can I get the hardship this has cause to my small business? Can I charge interest?

Attorney Answers 5

  1. You may be able to get compensation for interest, but your "hardship" claim probably not going to be successful. The explanation for why this is so could be a long one so I won't go into it here. Whether you get interest depends on the judge. Small Claims judges have more latitude than Superior Court judges.

    Having said that, however, you should ask for whatever you want to be compensated for - there's a small chance that you could get everything if the defendant doesn't show up.

  2. Have them cancel the other check and go there to pickup the replacement check. Unless this is a huge amount of money (over $10k), the hassle of trying to collect interest will not be justified. Also, bear in mind that you may want to get another large project with this hotel, so by tacking on picky charges that they did not agree, you might not get a call back. Hopefully, they were satisfied with your work. If not and they are playing "check in the mail games," then send them an invoice and if they fail to timely pay, file in small claims court for the amount due. The judge can add interest if it is shown to be an agreed amount that was supposed to be paid. You can ask for interest at the legal rate in your small claims complaint.

    Robert Stempler (please see DISCLAIMER below)
    Twitter: @RStempler

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  3. Under California law, the breach of a contractual obligation to pay money (unless otherwise specified in the contract) is the amount owing, plus interest thereon. Interest is computed at 10% per annum simple interest. Therefore you do not get "hardship" or consequential" damages for their failure to pay as agreed. The amount of interest can be calculated on the date of the trial.

    You should confirm / document your communications with them in writing. Be sure to ask them to confirm, in writing, the address to which they claim to have mailed the check. And be sure to send them an invoice.

  4. As the others have said, you can collect "pre-judgment" interest. There are no other damages that are USUALLY given in small claims; but you have to be sure to ask for them.

    If you have further questions, be sure to contact a lawyer that knows about Small Claims. Try:

    Adam Jaffe Law Office of Adam Jay Jaffe 124 Lomas Santa Fe Dr, #204 Solana Beach, CA 92075 (619) 810-7964 This posting is provided for “information purposes” only and should not be relied upon as "legal advice". Nothing transmitted from this posting constitutes the establishment of an attorney-client relationship. Applicability of the legal principles discussed here may differ substantially in individual situations or in different states.

  5. Mail a demand letter to the CEO/PRESIDENT of the hotel with cc: to Director of Finance and hotel manager. Enclose a copy of your statement for services and copies of the emails you exchanged with hotel personnel. In your letter, state that if the hotel does not remit full payment of [amount due for services] by [month day, year], you will pursue legal recourse to collect that amount plus attorney fees, costs and interest.

    Should you need to file a Small Claim, you have an advantage: You have emails from staff confirming the amount due. In your claim, request that amount plus 10% yearly interest from date of service through the date of the Small Claim. If the Small Claims judge enters judgment, the court filing fee and process servers fee can be added to the judgment, as well.

    The courts try to make Small Claims matter fairly simple. I suggest you begin your research soon after you mail the demand letter. Start by finding the county court website; the county will be the same county in which the hotel is located.