In the Philippines, the Rules of Procedure for Small Claims Cases aim to provide an expedited and inexpensive means of settling disputes involving pure money claims. Unlike regular civil litigation, these proceedings are informal and strictly prohibit the use of lawyers during the hearing.

I. Scope and Applicability

A small claims case involves claims for payment of money where the total amount—excluding interests and costs—does not exceed ₱1,000,000.00. This applies to all Metropolitan Trial Courts (MeTCs), Municipal Trial Courts in Cities (MTCCs), Municipal Trial Courts (MTCs), and Municipal Circuit Trial Courts (MCTCs).

Common sources of these claims include:

Contract of Lease
Contract of Loan
Contract of Services
Contract of Sale
Contract of Mortgage
Liquidated damages arising from contracts

II. Receiving the Summons

The legal process begins when the defendant receives a Summons from the court, accompanied by a copy of the Statement of Claim and its supporting evidence.

Note: Do not ignore the summons. Failure to respond within the prescribed period allows the court to render judgment based on the facts alleged in the Statement of Claim.

III. The Verified Response

The defendant must file a Verified Response within a non-extendible period of ten (10) days from receipt of the summons.

Key Components of the Response:

Form: The defendant must use Form 3-SCC (Response). Submitting a traditional legal pleading may be rejected or ordered to be corrected to fit the standard form.
Defenses: State clearly why the money is not owed. This may include:
- Payment: Proof that the debt has already been settled.
- Prescription: The period to file the claim has already lapsed.
- Lack of Jurisdiction: The claim exceeds the monetary limit or is not a pure money claim.
- Novation: The original obligation was replaced by a new one.
Compulsory Counterclaims: If the plaintiff also owes the defendant money arising from the same transaction, the defendant must include this in the Response. If not raised here, the claim is barred forever.
Evidence: Attach all supporting documents (receipts, affidavits of witnesses, contracts, or text message screenshots) to the Response.

IV. Prohibited Pleadings and Motions

To ensure speed, the Rules prohibit several filings that are common in regular courts. These include:

Motions to dismiss (except for lack of jurisdiction).
Motions for bill of particulars.
Motions for extension of time.
Petitions for relief from judgment.

V. The Hearing and Judicial Dispute Resolution (JDR)

The court will set the case for a hearing on a specific date.

Appearance: Both parties must appear in person. Because lawyers are prohibited from representing parties at the hearing, you must speak for yourself.
Representation for Corporations: If the defendant is a corporation, it must authorize an officer or employee (via a Secretary's Certificate/Board Resolution) who is not a lawyer to represent it.
Judicial Dispute Resolution (JDR): On the day of the hearing, the judge will first attempt to broker a settlement between the parties.
- If a settlement is reached: A Compromise Agreement is signed, and the court issues a Judgement based on that agreement.
- If no settlement is reached: The judge will proceed with a summary hearing and decide the case immediately or within 24 hours.

VI. Consequences of Non-Appearance

If the Defendant fails to appear: If the Response was filed, the court shall render judgment based on the Statement of Claim and the Response. If no Response was filed, the court shall render judgment as may be warranted by the Statement of Claim.
If both parties fail to appear: The case will be dismissed with prejudice (meaning it cannot be refiled).

VII. Finality of Judgment

The decision of the court in a small claims case is final, executory, and unappealable.

This means that the losing party cannot appeal the decision to the Regional Trial Court. The only legal remedy available in cases of grave abuse of discretion amounting to lack or excess of jurisdiction is a Petition for Certiorari under Rule 65 of the Rules of Court, though this is an extraordinary remedy and does not stay the execution of the judgment unless a preliminary injunction is issued.

VIII. Execution

Once the judgment is rendered, the winning party can move for the issuance of a Writ of Execution. The court-appointed sheriff will then enforce the decision, which may involve the garnishment of bank accounts or the levy of personal property to satisfy the debt.