Judge tightens rules on attorney fees in small claims court - 13 WTHR Indianapolis

Judge tightens rules on attorney fees in small claims court

Updated:
INDIANAPOLIS -

New rules to protect your pocketbook will soon take effect across Marion County.

The changes are the result of a 13 Investigates report uncovering high attorney fees in small claims courts. The investigation found collections attorneys operating by their own set of rules, charging people as much as four times what they actually owe in attorney fees.

In Decatur Township, attorney Derek Johnson was collecting a $500 fee, even for judgements under $100.

"I don't see how anybody could see your series without thinking, 'Maybe we need to take a second look at attorney's fees...and a lot of other things, as well," said Marion County Circuit Court Judge Louis Rosenberg.

For the first time, Rosenberg, who has oversight over small claims courts, is taking steps to protect everyday folks from exorbitant fees.

"Definitely. Definitely, there needs to be protections," said Washington Township resident Julie Sheffield.

In a just-released amendment, attorney fees must be based on the actual time spent on a case and charges separated out for work done by a paralegal, as opposed to an attorney. Attorneys can no longer charge each individual the full fee for costs associated with more than one case. That time must be apportioned, including travel expenses for cases heard on the same day.

"It was not supposed to turn into major ordeals, major legal costs. That's for another venue," said Mark Smith.

Smith lives in Perry Township and has heard the complaints about Marion County Small Claims Courts.

"To hear that there's some reason being applied to what I consider out-of-control attorney costs, in this day and age, that sounds like good news for the average person," he said.

Good news that quickly spread along a Saturday morning running course.

"It sounds like this new proposal is going to make sense in trying to minimize the cost and the barriers and obstructions to getting some sort of fair resolution," said Jeff Schmahl of Washington Township.

The new amendment takes effect December 1.

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