RULE OF PROCEDURE FOR SMALL CLAIM CASES (AM No.

08-8-7-SC)

It is a special rule of procedure adopted by the SC pursuant to its rule-making power to govern small
claims. This rule allows a plaintiff to sue a defendant without the need of a lawyer.

NOTE: The Rule on small claim cases did not create new courts. It simply provides a procedure for
prosecuting, defending, and adjudicating small claims cases, which by law are already within the
jurisdiction of first level courts.

SCOPE AND APPLICABILITY OF THE RULE

Scope of the Rules for Small Claim Cases

The Rule governs the procedure in actions for money claims before the MeTCs, MTCCs, MTCs and
MCTCs where the value of the claim does not exceed Php 100,000.00, exclusive of interest and costs.

NOTE: The amount for small claims is jurisdictional.

Cases covered by the Rule on Small Claims
1. Those which are purely civil in nature where the claim or relief prayed for by the plaintiff is
solely for payment or reimbursement of sum of money;
2. The civil aspect of criminal actions either filed before the institution of the criminal action or
reserved upon the filing of a criminal action in court, pursuant to Rule 111 of the Revised Rules
of Criminal Procedure (Sec. 4); and 3. The enforcement of a barangay amicable settlement or an
arbitration award involving money claims covered by the Rule, pursuant to Sec. 417, LGC.

Claims or demands
1. For money owed under any of following:
a) Contract of lease;
b) Contract of loan;
c) Contract of services;
d) Contract of sale; or
e) Contract of mortgage.

2. For damages arising from any of the following:

a) Fault or negligence;
b) Quasi-contracts; and
c) Contracts.

3. The enforcement of a barangay amicable settlement or an arbitration award involving a money

claim covered by this rule pursuant to Sec. 417, LGC (Sec. 4, A.M. No. 08-8-7-SC).

COMMENCEMENT OF SMALL CLAIMS ACTION; RESPONSE

Commencement of small claims action

The plaintiff must first accomplish a verified Statement of Claim and certify the information provided,
stating that he has not filed any action involving the very same issue in any other court, tribunal or
agency through a verification and certification of non-forum shopping.
The Statement of Claim must be accompanied by certified duplicate photocopies of all supporting
documents.
The plaintiff then files the Statement of Claim with its accompanying documents with the office of the
clerk of court of the small claims court, personally or through mail, and pays the correct docket and filing
fees prescribed under Rule 141 of the Revised Rules of Court

NOTE: No evidence shall be allowed during the hearing which was not attached to the claim unless good
cause is shown for the admission of the evidence (Sec. 5, A.M. No. 08-8-7-SC).

When there are separate small claims

Plaintiff may join in a single statement of claim one or more separate small claims against a defendant
provided that the total amount claimed, exclusive of interest and costs, does not exceed Php 100,000
(Sec. 6, A.M. No. 08-8-7-SC).

Indigent party
If one is an indigent, he may apply to the small claims court to qualify as an indigent, and once qualified,
he is exempt from payment of such fees (Sec. 8, A.M. No. 08-8-7-SC).

NOTE: In no case shall a party, even if declared an indigent, be exempt from the payment of Php
1,000.00 fee for service of summons and processes in civil cases (Ibid.).

Filing of response
The defendant shall file with the court and serve on the plaintiff a duly accomplished and verified
response within a non-extendible period of 10 days from receipt of summons.

The response shall be accompanied by certified photocopies of documents, as well as affidavits of

witnesses and other evidence in support thereof. No evidence shall be allowed during the hearing which
was not attached to or submitted together with the Response, unless good cause is shown for the
admission of additional evidence (Sec. 11, A.M. No. 08-8-7-SC).

Failure to file a response within the required period

The court by itself shall render judgment as may be warranted by the facts alleged in the Statement of
Claims limited to what is prayed for. The court however, may, in its discretion reduce the amount of
damages for being excessive or unconscionable (Sec. 12, A.M. No. 08-8-7-SC).

Counterclaims
If at the time the action is commenced, the defendant in his response may file as counterclaim a claim
against the plaintiff that:
1. Is within the coverage of this Rule, exclusive of interest and costs;
2. Arises out of the same transaction or event that is the subject matter of the plaintiff’s claim;
3. Does not require for its adjudication the joinder of third parties; and
4. Is not a subject of another pending action (Sec. 13, A.M. No. 08-8-7-SC).

NOTE: The defendant may also elect to file a counterclaim against the plaintiff that does not arise out of
the same transaction or occurrence, provided that the amount and nature thereof are within the
coverage of this Rule and the prescribed docket and other legal fees are paid.

Failure to include a counterclaim in the response

If the counterclaim is compulsory, it must be raised in the same case. Otherwise, it will be barred (Ibid.).
PROHIBITED PLEADINGS AND MOTIONS
1. Motion to dismiss the complaint

NOTE: the amended rules on small claim removed the exception on motion to dismiss based on
lack of jurisdiction. The grounds for the dismissal of the claim, under rule 16 of the rules of
court, should be pleaded (Sec. 11, A.M. No. 08-87-SC).

2. Motion for a bill of particulars;

3. Motion for new trial, or for reconsideration of a judgment, or for reopening of trial;
4. Petition for relief from judgment;
5. Motion for extension of time to file pleadings, affidavits, or any other paper;
6. Memoranda;
7. Petition for certiorari, mandamus, or prohibition against any interlocutory order issued by the
court;
8. Motion to declare the defendant in default;
9. Dilatory motions for postponement;
10. Reply;
11. Third-party complaints; and
12. Interventions (Sec. 14, A.M. No. 08-8-7-SC).

APPEARANCES
Appearance of parties
The parties shall appear at the hearing personally or through a representative they may authorize under
a Special Power of Attorney to enter into an amicable settlement, to submit to Judicial Dispute
Resolution (JDR) and to enter into stipulations or admissions of facts and of documentary exhibits (Sec.
16, A.M. No. 08-8-7-SC).

Appearance through a representative

Appearance through a representative must be for a valid cause. The representative of an individual-
party must not be a lawyer, and must be related to or next-of-kin of the individual-party. Juridical
entities shall not be represented by a lawyer in any capacity (ibid.).

Prohibition against appearance of lawyers

Lawyers are not allowed to appear at the hearing unless they are the plaintiff or the defendant.
However, since the process is still a legal process, the parties and their authorized representatives can
still consult with a lawyer to assist them to prepare for the hearing or for other matters outside the
hearing (Sec. 17, A.M. No. 08-8-7-SC).

NOTE: The court, in its discretion, may allow another individual who is not a lawyer to assist the party
(Ibid.).

Non-appearance of a party
1. If the plaintiff does not appear, the claim shall be dismissed without prejudice. The defendant
who appears shall be entitled to judgment on a permissive counterclaim.
2. If the defendant does not appear, the effect will be the same as failure to file a Response. This
shall not apply where 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.
 3. If both parties do not appear, the claim and counterclaim shall be dismissed with prejudice (Sec.
18, A.M. No. 08-8-7-SC).

HEARING; DUTY OF THE JUDGE

Duty of the court at the beginning of the court session

At the beginning of the court session, the judge shall read aloud a short statement explaining the nature,
purpose and the rule of procedure of small claims cases (Sec. 20, A.M. No. 08-8-7-SC).

Duty of the judge at the hearing

The judge shall exert efforts to bring the parties to an amicable settlement of their dispute. Any
settlement or resolution of the dispute shall be reduced into writing, signed by the parties and
submitted to the court for approval.

NOTE: There is no trial under the Rules on Small Claim Cases. Under Sec. 22, if efforts at settlement fail,
the hearing shall proceed in an informal and expeditious manner and be terminated within 1 day. Either
party may move in writing to have another judge hear and decide the case. The reassignment of the
case shall be done in accordance with existing issuances.

The referral by the original judge to the Executive Judge shall be made within the same day the motion
is filed and granted, and by the Executive Judge to the designated judge within the same day of the
referral. The new judge shall hear and decide the case within 5 working days from receipt of the order of
reassignment.

Postponement of a hearing
It 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 1 postponement (Sec. 19, A.M. No. 08-8-7-SC).

FINALITY OF JUDGMENT

Finality of Judgment
A decision in small claims cases is final and unappealable (Sec. 23, A.M. No. 08-8-7-SC). The declaration
that the decision is final and unappealable is in line with the nature of small claims which is designed to
preclude unmeritorious appeals that result in long drawn litigation for cases of this nature, pursuant to
the SC’s constitutional mandate to enact rules of procedure.

Remedy of a party
The rule does not preclude a party from filing a petition for certiorari under Rule 65 when there is grave
abuse of discretion amounting to lack or excess of jurisdiction in relation to a judgment in a small claims
action (such a petition is prohibited with regard to interlocutory orders).

Further, the aggrieved party can also file an action for annulment of judgment when the requirements
under the Rules of Civil Procedure are complied with.