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This article was originally published on June 1, 2022 and has been updated to reflect recent legal developments.
The following post does not create a lawyer-client relationship between Alburo Alburo and Associates Law Offices (or any of its lawyers) and the reader. It is still best for you to engage the services of a lawyer or you may directly contact and consult Alburo Alburo and Associates Law Offices to address your specific legal concerns, if there is any.
Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
With the implementation of the Office of the Court Administrator (OCA) Circular No. 69-2002, the judiciary has taken a major step toward faster and more accessible justice. The new Rules on Expedited Procedures in the First Level Courts simplify the filing of small claims cases, allowing Filipinos to recover debts and resolve monetary disputes without the burden of lengthy trials or high legal costs. Now enhanced by electronic filing and service, the small claims process brings justice closer to the people, swift, convenient, and within everyone’s reach.
In an effort to streamline the judicial process of Small Claims Cases, the Office of the Court Administrator (OCA) issued Circular No. 69-2002, which introduced the Rules on Expedited Procedures in the First Level Courts. This circular took effect on April 11, 2022, making a major step toward simplifying the resolution of small monetary disputes in the country.
Under Section 1, Rule I of OCA Circular No. 69-2002, a “small claim” is defined as an action that is purely civil in nature where the claim or relief raised by the plaintiff is solely for the payment or reimbursement of a sum of money. It excludes actions seeking other claims or reliefs aside from payment or reimbursement of a sum of money and those coupled with provisional remedies.
This article breaks down the key provisions of OCA Circular No. 69-2002, and serves as a guide for filing a small claims case in the Philippines.
What Can be Claimed Under a Small Claims Action
A small claim covers payment or reimbursement of a sum of money where the value of the claim does not exceed One Million Pesos (PhP1,000,000.00), exclusive of interest and costs. [Rule IV, Sec. 1]
The claim or demand may be:
(a) For money owed under any of the following:
- Contract of Lease
- Contract of Loan and other credit accommodations
- Contract of Services
- Contract of Sale of personal property, excluding the recovery of the personal property, unless it is made the subject of a compromise agreement between the parties.
(b) For the enforcement of barangay amicable settlement agreements and arbitration awards, where the money claim does not exceed One Million Pesos (PhP1,000,000.00), provided that no execution has been enforced by the barangay within six (6) months from the date of the settlement or date of receipt of the award or from the date the obligation stipulated or adjudged in the arbitration award becomes due and demandable, pursuant to Section 417, Chapter VII of Republic Act No. 7160, otherwise known as the Local Government Code of 1991. [Rule I, Sect. 1]
You may join in a single Statement of Claim two (2) or more separate small claims against a defendant, provided that the total amount claimed, exclusive of interest and costs, does not exceed One Million Pesos (PhP1,000,000.00). [Rule IV, Sec. 6]
How to File a Small Claims Case
Section 4, Rule IV of OCA Circular No. 69-2002 states that a small claims action is commenced by filing with the court the following:
- An accomplished Statement of Claim/s with Verification and Certification Against Forum Shopping, Splitting a Single Cause of Action, and Multiplicity of Suits (Form 1-SCC)
- Duly certified photocopies of the actionable document/s subject of the claim
- Affidavit of witnesses
- Other evidence to support the claim, with as many copies thereof as there are defendants.
Take Note that no evidence shall be allowed during the hearing unless it was attached to or submitted together with the Statement of Claim/s, unless good cause is shown for the admission of additional evidence. [Rule IV, Sec. 4]
You must also state in the Statement of Claim/s you are engaged in the business of lending, banking and similar activities, and the number of small claims cases filed within the calendar year, regardless of judicial station. [Rule IV, Sec. 4]
If the plaintiff is a juridical entity, a Board Resolution or Secretary’s Certificate authorizing the representative to file the claim must be attached to the Statement of Claim/s. [Rule IV, Sec. 4]
Affidavits must state only facts based on affiant’s direct personal knowledge or on authentic records, which are admissible in evidence. In case of violation, the party, and the counsel who assisted that party in the preparation of the affidavits, if any, shall be subject to appropriate disciplinary record and the inadmissible affidavit(s) or portion(s) thereof shall be expunged from the record. Moreover, failure to submit the required affidavits will cause the immediate dismissal of the claim or counterclaim. [Rule IV, Sec. 7]
Where to File Your Small Claims Action
Submit the Form 1-SCC together with all the necessary supporting documents to the Small Claims Court, which may be a Metropolitan Trial Courts (MeTC), Municipal Trial Court in Cities(MTCC), Municipal Trial Courts(MTC), or Municipal Circuit Trial Courts(MCTC), depending on the location of the parties.
A small claims case should be filed:
- Where the plaintiff resides, or
- If the defendant is an individual, in the court where they reside or where the cause of action arose
- If the plaintiff is engaged in the business of lending, banking and similar activities, and has a branch within the municipality or city where the defendant resides or is holding business, file in the court of the city or municipality where the defendant resides or is holding business.
- If there are two (2) or more defendants, it shall be filed in the court of the city or municipality where any of them resides or is holding business, at the option of the plaintiff. [Rule IV, Sec. 5]
Submit your documents to the Office of the Clerk of Court and pay the necessary filing fees and service of summons fees.
If you cannot afford to pay, you may file a Motion to Sue as Indigent (Form 6-SCC) to request exemption from legal fees under Rule 141, Section 19 of the Rules of Court. [Rule IV, Sec. 8]
Electronic Filling and Service
The service of court issuances and filings by the plaintiff/s and defendant/s may be made through email, facsimile, and other electronic means. Notices may also be served through mobile phone calls, short messaging service (SMS), or instant messaging (IM) software applications. The consent to, and chosen mode of, electronic service and notice shall be indicated in the Statement of Claim/s or Response, as the case may be. [Rule IV, Sec. 11]
Court Action Upon Filing
Once the Statement of Claim is filed, the court may do either of the following:
- Dismiss the claim outright – The court may dismiss the case outright, on its own initiative, if upon examinations of the allegations contained in the Statement of Claim and of the attached evidences, the court finds any ground for dismissal stated under the Circular. [Rule IV, Sec. 9]
- Issue summons and notice of hearing – If no ground for dismissal is found, the court shall issue summons within twenty-four (24) hours from receipt of the Statement of Claim/s, directing the respondent to submit a verified Response. The court shall also issue a notice to both parties, directing them to appear before it on a specified date and time for hearing, with a warning that no unjustified postponement shall be allowed. [Rule IV, Sec. 10]
Appearance of Attorneys Not Allowed
Under Section 18, Rule IV of the OCA Circular, no attorney shall appear in behalf of or represent a party at the hearing, unless the attorney is the plaintiff or defendant. Only if the court determines that a party cannot properly present his/her/its claim or defense and needs assistance, the court may, in its discretion, allow another individual who is not an attorney to assist that party with their consent.
Non-Appearance of Parties
Failure to appear shall be cause for the dismissal of the Statement of Claim/s without prejudice and the defendant who appears in the absence of the plaintiff shall be entitled to judgement on the counterclaim.
In case the defendant fails to appear, it shall have the same effect as failure to file a Response, except when one of two or more defendants who are sued under a common cause of action and have pleaded a common defense appears at the hearing. [Rule IV, Sec. 19].
When are Postponements allowed?
A request for postponement of a hearing may be granted only upon proof of the physical inability of the party to appear before the court on the scheduled date and time. A party may avail of only one (1) postponement. [Rule IV, Sec. 20]
Filing a small claims case is an accessible, affordable and efficient way for individuals and businesses to resolve simple monetary disputes without the need for lengthy court battles or costly legal representation.
Thanks to the Rules on Expedited Procedures in the First Level Courts under OCA Circular No. 69-2022, the judicial process has become faster and more convenient, especially with the introduction of electronic filing and service.
Whether you’re seeking to recover unpaid debts, or reclaim money owed, understanding and knowing the right procedures empowers you to assert your rights effectively.
Related Article: Proven Ways in Debt Collection
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good day po. ask ko lang po. kasi may loan po ako sa home credit . nagpadala daw po supoena small claims sa bahay kung saan ako nakatira. hidi ko po na received kasi lola ko po naka received at late na po naibigay sa akin . what i eman po is naibigay sa kain supoena tapos na hiring. Paano po kaya gagawin ko. hindi ko po alam naging result ng judgement sa akin. pde pa po ba ako mag appeal?
Hi Atty. May utang po ako online. 3000 pero 2700 lang natanggap ko. I failed to give back 3900 sa tamang oras at nagbayad ako ng interes na 900. Pero yun pla, kahit magbayad ng 900 additional 700 pa din. Bale 2700 na po naibayad ko. Ngayon pinupuah nila na bayadan ko eh 10500 daw. Ano pong magandang gawin ko dito sir? Thanks po.
Good Morning Atty.
Hingi po ako ng advice, nagkautang din po ako sa isang mobile app o online lending company, na miss ko po na magbayad ngunit nang nag umpisa na po sila sa collection activities nila ay sobrang below the belt po, may mumurahin ka at sabi isasampal daw sa mukha ko ang warrant of arrest sa harap ng mga pamilya ko at pag napakulong daw nila ako ay may mga threat pa na ipapagahasa asawa ko habang nasa kulungan ako. Ganun po sila makipag usap kaya mula noon ay d ko na sinasagot tawag nila subalit ang interest ng inutang ko ay naging mahigit 50% at umaakyat pa araw araw. Ano po ang maipapayo nyo sa akin?
Hello sir,
Can I use FB messenger exchanges as agreement namin for loan nung nakahiram sa Amin? Tapos fund transfer receipts for the amounts na pinahiram?
I’m outside of Phils. My family is in Mindanao per nanghiram sa Amin taga Manila, where can I file the claim? Pwde sa Mindanao tapos SPA for my relative? Paano hearing Kung nasa Manila nanghiram? Salamat Po sa reply niyo
Paano po kung ayaw i-disclose ni defendant yung address nya? Pwede po ba ang last known address or address ng opisina nila?
Magkano po ang puwedeng hingin na interes kung taon na po ang binilang?
Kung hindi po talaga sila magbayad sa itinakda ng small claims court ano po ang susunod na hakbang?
Good day!
Attorney, same situation pero this time na provide ko na ang total sum ng utang ko. But the creditor is asking for the late payment and interest per day and is now contacting my employer. Pa resign na po ako this december, hinihintay ko lang po ang 13th month pay ko. Baka po matanggal ako dahil sa gagawin nila lalo akong mabaon sa utang dahil wala akong maipambabayad. Magpapasa nga din daw po sila ng case sa small claims court. Ano po pwede ko gawin? Nasa 6500 po binanggit na late payment at interest. Thanks
Hi Atty.
Goodmorning po sainyo, ako po ay isang ofw na nagtratrabaho sa middle east may nangutang po sakin ng halagang 100,000 dito may kasulatan po kami at nakapirma po sya, pwede ko po ba sya sampahan ng kaso kahit nasa abroad kaming dalawa? Bale kukuha lang po ako ng representative ko para mag file ng case, kasi po almost 3 taon na yung utang nya at nakasaad po doon na magpapatubo sya sakin dahil po inutang ko lang din po yung pera sa banko. Nagpadala napo ako ng letter of demand saknya ng isang beses pero nangako lang po sya na magbabayad at hanggang ngayon po hindi parin po sya nagbabayad, Sana po mabigyan nyo ako ng payo at kailngan ko na pong bayaran sa banko ang utang ko. Maraming maraming salamat po sainyo
Hi, may utang po kasi kami with the financing company. Nagkaproblema po kasi, e ang gusto nila mgbigay kami ng 20k a month. Kasi nasa 40k nalang utang ko inclusive of interest and penalty. Dpat last May pa tapos. Sabi ko mgdodown2 nalang ako. At wala naman buwan na indi ako naghuhulog at bnabayaran ko nman ang penalty and interest. Kung tutuusin bayad kona yung principal. Interest and penalty nalang kulang. Kaso hinaharass nila ang parents ko and brother na padadalhan ng demand letter, if indi ako makapagbigay ng 20k a month. Kasi lapse na daw yung payment ko. Sabi papadalhan nila demand letter yung company ng kuya ko, kasi sa kanya nakapangalan. E nawalan kasi ako ng work. So sabi ko mghuhulog2 nalang muna ako indi nman baba ng 5k hulog ko sa kanila. Pwede po ba yun? Mkakasuhan po ba kami? Thanks
Dear Eann c vela,
Since sa kapatid mo nakapangalan yung loan, pwede sya ma-demanda ng small claims. Pero yung demand letter ng creditor, dapat sa kanya ipadala at hindi sa kumpanya kung saan sya nagtatrabaho. Kung hindi sa kanya ipadala yung demand letter, pwede nyang i-deny na natanggap nya ito mula sa creditor just in case lang na mademanda sya ng small claims.
-Atty. Arjay
Follow-up lang po sa question ni Joseph, May Law po ba tayo para sa limitation ng interest?
Dear Justine,
Meron, at ito ay ang “Usury Law” (Act No. 2655). Kaya lang, sa ngayon suspended ang application ng Usury Law kaya walang ceiling ang interest na pwedeng mapag-usapan ng creditor at ng debtor.
-Atty. Arjay
May utang po ako online, Hindi KO pa sya nababayaran dahil may inuna akong bayaran lumagpas na po sa sa due date , yung 1800 KO ng utang nagging 2600, ngayon po , kada araw may patong na 80 pesos ,plus 700 na late payment fee, makakasuhan po ba ako kunng sakaling Hindi KO sya mabayaran, palake ng palake kase yung tubo,
Dear Joseph Ponsaran,
Pwede ka makasuhan ng small claims. Pero kung talagang kakasuhan ka man nila, sila lang ang makakapagsabi nun.
-Atty. Arjay