Over the years that I presided in small claims court, I entered hundreds, if not thousands, of form judgments without ever really pausing to examine the form. Recently, I taught a new course for magistrates on conducting hearings and entering judgments. As part of that course, I spent a couple of sessions analyzing two judgment forms frequently used by magistrates in small claims:
AOC-CVM-400, Judgment in Action to Recover Money or Personal Property;
AOC-CVM-401, Judgment in Action for Summary Ejectment. This post will explore the various parts of the form judgment for the recovery of money or personal property and the legal significance of the form’s contents.
Findings
- Notice of Claims and Date and Time of Hearing
Before the section for recording findings of fact, the form judgment includes the following language: “This action was tried before the undersigned on the cause stated in the complaint. The record shows that the defendant was given proper notice of the nature of the action and the date, time and location of trial.” While this section does not require action by the magistrate, this statement encompasses especially important aspects of due process—notice and an opportunity to be heard.
Motions to dismiss based on
Rule 12(b)(6) of the Rules of Civil Procedure are not permitted in small claims. However, the judicial official presiding over a small claims action should still ensure that the form
complaint filed by the plaintiff provides sufficient notice to the defendant of the claims to allow the defendant to effectively respond.
G.S. 7A-216.
Further, the judicial official is responsible for ensuring that the defendant was properly served with the summons and complaint prior to the date set for hearing. Service in actions for money owed or the recovery of personal property must be accomplished at least five days prior to the date set for hearing.
G.S. 7A-214. If the summons indicates that the minimum notice of five days has not been satisfied, the judicial official should continue (i.e., postpone) the case to satisfy the notice period, unless the defendant makes a knowing waiver of the minimum notice requirement.
A knowing waiver requires the judicial official to explicitly inform the defendant of the amount of minimum notice to which the defendant is entitled and to ask if the defendant wishes to continue the case or proceed. If the defendant waives minimum notice, the judicial official should record such waiver in the “Findings” section under “Other.” If the defendant does not waive minimum notice, the judicial official should continue the case for a time period that will at least satisfy the minimum notice requirement. The judicial official should use form
AOC-G-108, Order, to order the continuance.
Typically, the burden of proof in small claims cases is by the greater weight of the evidence, also referred to as the preponderance of the evidence, meaning more likely than not. It is important to remember that a defendant may, but is not required to, file an answer to the plaintiff’s complaint. The defendant’s failure to file an answer constitutes a general denial of all of the allegations in the complaint.
G.S. 7A-218. Therefore, the plaintiff must present evidence that establishes a
prima facie case for each claim.
G.S. 7A-222. If the plaintiff fails to establish a
prima facie case, then the judicial official may enter a dismissal by checking the appropriate box on the form judgment.
Id.
If the action is for breach of contract, the judicial official must make additional findings related to interest. The principal sum awarded in a breach of contract action earns interest from the date of breach, so it is imperative that the judicial official make a finding that establishes that date. Further, the interest rate will be the legal rate of eight percent (8%) unless the parties’ contract establishes a different rate for post-or pre-judgment interest. The form judgment provides space for these entries by the judicial official.
Note, this section does not list additional findings for the judicial official to complete if the action is based in tort, either intentional tort or negligence. The judicial official may want to include additional findings. For example, if the action is based on negligence and the defendant establishes that the plaintiff was contributorily negligent, the judicial official may want to note that in the “Findings” section under “Other.” The principal sum of the judgment also earns interest at the legal rate of eight percent (8%) from the time of filing the tort action, a date established by the time stamp on the complaint.
In actions to recover personal property, the judicial official may want to record in the “Findings” section under “Other” if any of the property listed on the complaint is no longer in the possession of the defendant. In part, this is because in the “Order” section the judicial official must decide whether to return all or a portion of the property listed on the complaint to the plaintiff.
These suggestions for additional findings are not exhaustive, and the judicial official may record other relevant findings in this area of the judgment form. These findings are appropriate to support the conclusions that the judicial official checks in the “Order” portion of the form judgment, especially with regard to interest in breach of contract and tort actions.
Order
- Recover Possession of Personal Property
In an action for the recovery of personal property, the complaint will list the personal property sought by the plaintiff. If the evidence supports the return of all of the property listed, then the judicial official will check the first box in the “Order” section of the form judgment. If the judicial official finds that the plaintiff is entitled to some, but not all, of the property listed on the complaint, the judicial official will check the second box and list the property to which the plaintiff is entitled. As noted above, this second scenario sometimes occurs when the defendant is no longer in possession of the property, or in the case of a secured transaction, when the defendant has paid off some of the property that was financed and is entitled to keep it.
If the plaintiff fails to persuade the judicial official by a preponderance of the evidence that the plaintiff is entitled to the relief sought, then the judicial official will dismiss the action by checking the third box in the Order section of the form judgment.
G.S. 7A-222. This dismissal is usually with prejudice, meaning that the plaintiff cannot refile the same claim against the defendant. If the plaintiff disagrees with the judicial official’s decision, the plaintiff has the right to appeal the case for a new trial in district court.
G.S. 7A-228.
Lastly, the form judgment requires the judicial official to determine whether the plaintiff will recover the costs of court. The costs of court include the filing fee paid to the court for initiating the action and the costs for service of process whether service is by certified mail, publication, or personal service by the sheriff, or in some cases, by a process server.
G.S. 7A-305. If the plaintiff is the prevailing party, then the plaintiff is presumptively entitled to the costs of court.
G.S. 6-1. In that instance, the judicial official will check the box in the “Order” section that taxes the costs to the defendant. If the plaintiff’s case is dismissed, then the plaintiff is responsible for the costs of court and the judicial official can check that box.
Service of the Magistrate’s Judgment
- Announced, Signed and Served in Open Court
The magistrate’s judgment is rendered when it is reduced to writing and signed by the magistrate or when it is rendered electronically by the magistrate.
G.S. 7A-224. And the time clock for the parties to file a written notice of appeal begins to run when the magistrate’s judgment is rendered.
G.S. 7A-228. Entry of the judgment takes place as soon as practicable thereafter. A judgment is entered when it is reduced to writing, signed by the judge, and filed with the clerk of court pursuant to Rule 5 of the North Carolina Rules of Civil Procedure.
G.S. 1A-1, Rule 58.
Although small claims judgments are entered in accordance with Rule 58 like all other judgments, service of small claims judgments is treated differently. When the judgment in small claims is announced and signed in open court at the conclusion of the hearing, the judgment is considered served on the parties, even if the defendant is not present.
Id. When the judgment is not announced and signed in open court, the judgment must be served by the magistrate on all the parties (and attorneys of record if applicable) within three days after the judgment is entered.
Id. All time periods, like the time to appeal, are tolled for the duration of any period of noncompliance with the service requirement in Rule 58.
Id. So, if the magistrate does not announce and sign the judgment, whether in writing or electronically, in open court at the end of the case, the time for appeal is extended until three days after the magistrate mails a copy of the judgment to the parties and attorneys of record or a maximum of ninety days after judgment is entered.
Id.
In speaking with magistrates, it has come to my attention that some magistrates are announcing their judgment, and recording it in the minutes, but not reducing the judgment to writing and signing it in open court. Then, at the end of the day, the magistrates are going back and entering the written judgments based upon the minutes. This practice is problematic for a couple of reasons. First, if the judgment is not reduced to writing or entered into Odyssey and signed, then the judgment has not been effectively rendered and served on the parties, even though it was announced. Because of this delay, it is as though the magistrate reserved judgment on the matter and now must serve the judgment on the parties. Second, there is a likelihood that the minutes will not accurately reflect what was announced, which will impact the precision of the written judgment. The best practice is to type and sign your judgment at the conclusion of the evidence and announce it from the written and signed judgment form.
- Reserved Judgment and Certification
When the magistrate intentionally decides to reserve judgment and does not reduce the judgment to writing and sign it in open court, the magistrate is responsible for serving the judgment on the parties and the attorneys of record. In those cases, the magistrate will complete the “Certification” box on the bottom of the form judgment indicating service of the judgment on the parties.
A Note of Gratitude
I would like to take this opportunity to thank the magistrates who bravely attended the inaugural offering of “Conducting Hearings and Entering Judgment” and the UNC School of Government Summer Law Fellows—Sloan Godbey, Faith Gray, and Amelia Walker—who skillfully assisted in the mock trials. I look forward to teaching the class again, but in the near future, magistrates who want to know more about judgments can attend my session at this year’s fall conference. I hope to see you in Beaufort in September.
