A bill approved recently by Congress now awaiting President Reagan's signature would raise from $750 to $2,000 the limit on lawsuits in the city's small claims court, the first change in the limit in more than a decade.
The change is expected to have a dramatic impact on District residents and businesses who use the court system and is expected to reduce backlogs and delays that have plagued litigants and court officials.
The new limit would mean that people who have disputes involving money or goods valued at $2,000 or less could have their cases handled in small claims court and receive a faster hearing without an attorney. With the limit at $750, inflation has forced an increasing number of people to file their cases in the already clogged civil branch, which usually required hiring a lawyer and usually waiting a year or more for a hearing and a decision.
As many as 40 to 50 percent of all cases now filed in civil court could be filed as small claims if the president signs the law, said Larry Polansky, executive officer of the city's court system.
"What will happen, we hope, is that there will be a significant reduction in civil filings and we will weed out of the civil program what lawyers call collection cases on debts , leaving real legal matters," Polansky said. "Since the numbers will be less, we'll be able to move them much more quickly."
But the measure has also raised concerns that poorer city residents who don't pay their bills and can't afford an attorney would be forced to pay debts faster and that collection efforts by businesses would increase.
"It's going to have an important impact in terms of people getting cases in and out of the court with some dispatch," said Samuel F. Harahan, director of the Council for Court Excellence, a local court watchdog group that had pushed for the higher small claims limit.
Judges, businessmen and some lawyers have been complaining for years that the small claims limit was too low and that Congress, which is responsible for legislation affecting the city's courts, was not paying enough attention to the adverse effects of inflation on court administration.
Now in small claims court, cases are generally settled within two weeks or 21 days after they are filed, Polansky said. In the civil division the average length of time to settle disputes runs between a year to 18 months. Those who would be forced to file in the civil branch because their claims exceed the $2,000 limit would see a reduction in delays there, Polansky added.
Consumer advocates had expressed fears that a new limit would speed up collection efforts against poor city residents.
William Martin, assistant director of Neighborhood Legal Services, said the raised limit would encourage companies to pursue debts they now drop because of the delays and legal costs involved in the civil branch. He said he expects more suits by insurance companies with automobile negligence claims, and many consumers will be caught unaware of the change in the law or without legal help.
"It will probably increase demand to represent people in small claims," Martin said. But "because of our resources, we're limited in the number of people we can represent."
The measure would also result in an immediate savings to many litigants filing suits in the court. The fee for filing a small claim is only $1, plus a $1.50 charge for mailing the complaint to the defendant.
The fee for filing suit in the civil branch is $45, plus $75 for a jury trial. Plaintiffs in civil court must serve papers on defendants themselves.