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Thursday, October 03, 2013

Ind. Courts - "Marion Circuit Court Adopts Amendment to Small Claims Court Rule"

Yesterday the ILB saw this item on the Indianapolis Bar Ass'n. website:

Marion Circuit Court Adopts Amendment to Small Claims Court Rule

On July 16th, the Marion Circuit Court published for comment a proposed amendment to Marion County Small Claims Court Rule 49SC00502. Following a comment period ending August 31, the court modified the rule as proposed. Pursuant to Indiana Trial Rule 81 and Indiana Code § 33-34-5-6, the Marion County Circuit Court now adopts the attached rule.

To view the order amending the rule, click here. To view the rule change, click here.

This rule will be effective on December 1, 2013.

The rule change has to do with a attorney's fees and how they are to be determined by the small claims court judge. Here is the comment to the rule:
Comment: The purposes of the proposed amendment are two‐ fold. This court has observed divergent practices and policies for determining “reasonable attorneys fees”. The first purpose is then to promote uniformity on this subject.

The second purpose of the amendment is to clarify that the courts are obliged to consider a wide variety of factors other than the amount of attorney time spent on the case. The amendment incorporates by reference Rule 1.5 of the Rules of Professional Conduct which lists no less than 8 factors.The list is not, however, exhaustive.

The Rule as amended would require counsel to separate work done by a paralegal from work done by an attorney. It also requires documentation of the time expended.

It disallows costs which are attributable to more than one case, unless the time can be apportioned with reasonable accuracy. Thus, if an attorney has travel time of one hour to cover 3 cases, 1/3 of an hour may be charged to each case. On the other hand, the time required to develop a standard demand
letter would not be recoverable, although the time spent generating such a letter in a particular case would be compensable.

While the Rule bars the recovery of anticipated legal services, it does not bar the Plaintiff from seeking a supplemental award of attorneys fees for work done after judgment.

Subsection B3, which addresses the problem of fees, which are disproportionate to the relief sought or received , is implicit in RPC 1.5(4), but warranted elaboration in view of its relevance to Small Claims cases.

Several commentators on the Rule as proposed and published on July 16, 2013, criticized the provision requiring the Court to consider the course of negotiations in determining what a reasonable fee would be. The critics noted the conflict between this provision and Indiana Rules of Evidence, Rule 408. This provision was also criticized as potentially counterproductive ie. will deter rather than encourage negotiations. The Court believes that the above criticisms are valid and has accordingly deleted the provision in the final draft. No other changes to the proposed amendment of this Rule have been made.

Many rule changes and changes to the court structure have been proposed to resolve problems with the Marion county small claims courts - see this May 31, 2013 ILB post.

This rule change seems to address the last paragraph of that post:

A second story [by Sandra Chapman, WTHR.com], from May 30th, is headed "Judge seeks changes to eliminate high small claims fees." It includes quotes from Marion County Circuit Judge Louis Rosenberg, who is charged with overseeing the small claims courts, re plans for improvement.

Posted by Marcia Oddi on October 3, 2013 09:53 AM
Posted to Indiana Courts