RELATING TO SMALL CLAIMS COURT.

HB518

HOUSE OF REPRESENTATIVES

H.B. NO.

518

THIRTY-THIRD LEGISLATURE, 2025

STATE OF HAWAII

A BILL FOR AN ACT

RELATING
TO SMALL CLAIMS COURT
.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

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SECTION
1.
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The legislature finds that small
claims court was initially intended to be a means to bypass the formal and
expensive traditional judicial process.
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Though in practice, by allowing for legal representation, individuals
can find themselves in inequitable circumstances when it comes to presenting
legal arguments, objecting to motions, and appealing decisions.

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The
legislature finds that hiring a lawyer for small claims court is rarely cost
efficient.
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In addition, Hawaii small
claims court limits the amount in controversy in most cases to $5,000, while
most individuals filing claims for that amount or less are unable to afford or
find an attorney to represent them.
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The
legislature also finds that numerous states including California, Nebraska, and
Idaho do not allow for legal representation in small claims courts.

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The
purpose of this Act is to ensure that small claims court remains a cost
effective, equitable, fair, and accessible method of obtaining justice for all individuals
in Hawaii by prohibiting representation in small claims court by legal counsel
for all parties.

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SECTION
2
.
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Section 633-28, Hawaii Revised Statutes, is
amended to read as follows:

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"
�633-28
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Small claims, no appeal; appearance by whom.
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(a)
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Actions shall be commenced and conducted in the small claims division of
the district court as provided by the rules of court.
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The clerk of the court, at the request of an
individual, shall prepare the papers required to be filed in an action in the
court, but the clerk's services in the preparation of these papers shall not be
available to a corporation, partnership, or association, or to any individual
proprietorship.
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The mode of service
shall be:

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(1)
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As provided by law or rule of court for cases
in the district courts; provided that for any small claims action, service may
be made by one of the parties to the action by means of personal service to the
other parties, on the condition that:

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(A)
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The party being served signs that party's name
to indicate actual receipt of service; or

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(B)
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A competent witness, who is not an employee,
family member, or agent of the plaintiff appears at a hearing on the matter or
provides a notarized affidavit testifying that personal service on the party
sought to be served was accomplished in the witness' presence;

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(2)
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As to actions arising under paragraphs (1) and
(3) of section 633-27(a), by registered mail or by certified mail with return
receipt signed by the addressee showing delivery within the circuit; or

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(3)
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As to actions arising under paragraph (2) of
section 633-27(a), by registered mail or by certified mail with return receipt
signed by the addressee showing delivery at any place within or without the
State.

There shall be no appeal from a judgment of the
small claims division, but the court, sitting as the small claims division, may
alter or set aside any judgment as provided by the rules of court.

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(b)
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Notwithstanding any provision of law
requiring the licensing of practitioners, [
any person, with the approval of
the court, may appear on behalf of the person or another person in the small
claims division of the district court; provided that,
] in cases in the
small claims division of the district court [
involving disagreement between
landlord and tenant about the security deposit in a residential landlord-tenant
relationship,
] licensed practitioners are prohibited from appearing on
behalf of another person.
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The services
of an unlicensed person appearing under this subsection shall be without
compensation, either by way of direct fee, contingent fee, or otherwise.
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In the event representation services are
rendered for compensation, this subsection is inapplicable and the rendering of
the services constitutes the unlawful practice of law, except as otherwise
provided."

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SECTION 3.
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Statutory material to be repealed is
bracketed and stricken.

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SECTION 4.
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This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________

Report Title:

Small Claims
Court; Attorney; Representation; Legal Counsel

Description:

Prohibits
licensed attorneys from representing clients in small claims court.

The summary description
of legislation appearing on this page is for informational purposes only and is
not legislation or evidence of legislative intent.