More good news for the Small Claims court!!

On July 8, 2011, Governor Jerry Brown signed Senate Bill 221 into law. SB 221 increases the Small Claims Court jurisdictional limit from $7,500 to $10,000 with two caveats. First, the jurisdictional limit of the Small Claims Court will remain $7,500 for claims of bodily injury resulting from a car accident if the defendant in the action is insured and the insured’s policy includes a duty to defend. Second, the Small Claims jurisdictional limit will remain $5,000 for suits brought by entities such as corporations, limited liability companies, partnerships and the like.

It should also be noted that pursuant to California Code of Civil Procedure Section 116.231, an individual may not file more than two small claims actions that exceed $2,500 in any year.

Since the new legislation does not include an “effective date,” it is assumed that SB 221 will become law on January 1, 2012.