Lately we have seen some occupants in post-trustee sale evictions seeking to delay evictions by removing the case from justice or superior court to the federal United States District Court. This action is done in bad faith to delay the eviction and is without any legal basis. Tenants undertaking such actions are often sanctioned with monetary and other penalties by the federal court. When confronted with this situation, landlords are seeking to understand what “removal” is and are seeking to have the case returned to the state court so that they may proceed with the eviction. In representing landlords in these cases, I have found that many that are unfamiliar with the basic structure of our legal system and the interplay between the different courts. It’s important for any landlord and investor to know the basics of each court and what cases are appropriate for which courts. This article hopes to give an overview of the court structure from a landlord and investor perspective. This article also doesn’t address the appellate courts.
Our legal system is divided between the federal courts and the state courts. Most cases for investors and landlords are handled in the state courts which consist of: small claims; justice court and superior court. Landlords are most familiar with the justice courts, which include small claims matters. The justice court has a broad scope for the types of cases which can be heard, but it has a monetary limit of $10,000. The majority of evictions are handled through justice court. Additionally, most cases involving a return of security deposit and other landlord tenant issues are regularly seen in the justice court. A justice of the peace does not have authority to hear cases involving a dispute over title over real property; such matters must go to superior court. A justice of the peace does not have to be an attorney, and they are elected to the bench by the community.
Small claims cases, which have a limit of $2,500, are heard in a division of the justice court, but they do not follow the usual legal formalities. They are usually heard by a hearing officer who need not have formal legal training, and the parties do not file motions. The parties simply appear at the hearing and present their sides. It’s as informal as the courts get. Often times, tenants will file suits over security deposits in small claims because they like the informal proceedings and no appeal is allowed.
In some cases, landlords and investors end up in Superior Court. Usually this is in evictions for over $10,000, in disputes of ownership to homes, or in partnership disputes. Additionally, if a tenant is seriously injured in a property, they will likely file suit in superior court. This is because Superior Court is a court of general jurisdiction meaning that any lawsuit can be filed in Superior Court, and there is no monetary limit. Either party can sue for millions of dollars, but rarely does this happen in landlord tenant matters. Superior court judges have to be attorneys and most are selected by the governor to the bench through a merit selection process.
In contrast to state courts, federal courts (known as district courts) are limited in scope. A case can only be filed in federal court if certain factors are met: the case must raise a federal law question (i.e. constitutional issues) OR the parties must be from different states and the amount in dispute is over $75,000. Instead of being divided by state lines, the different courts are separated into circuits based upon their location in the country. In total there are 11 circuits. Judges in federal court are always attorneys, and they are appointed to the bench for life by the President of the United States. Most landlord tenant matters do not ever end up in the federal system, as the cases do not meet the necessary standards. However, that doesn’t mean an unscrupulous tenant won’t try to use the federal courts to delay eviction.
If a case is filed in state court that meets the requirements to be filed in federal court, the defendants can “remove” the case to federal court by filing a Notice of Removal. A case is automatically transferred upon proper filing of the Notice. However, as mentioned above, some post-foreclosure occupants are now filing these in evictions even though it’s clear that an eviction will never give rise to federal jurisdiction. Therefore, immediate action needs to be taken to ensure that the federal courts reviews the Notice and determines if it is frivolous. In cases where it is frivolously filed, such as in an eviction, the court can sanction the filer (tenant) for improperly seeking removal. To avoid your case simply disappearing into the amass of the federal court system, make sure you have legal counsel take immediate action to respond to any Notice of Removal.