The Short Answer
If they owe you up to ₱1,000,000, not counting interest and costs, you can file a small claims case. You file it in the local trial court for your city or town (the first-level court: the Metropolitan, Municipal, Municipal in Cities or Municipal Circuit Trial Court). Send a written demand first, and go to the barangay first if you both live in the same city or municipality. No lawyer may appear for either side at the hearing, the judge decides within a day, and the decision is final.
Example: Tess Bautista's Loan to Her Kumare
Names and details in this example are made up.
Teresita "Tess" Bautista runs a sari-sari store in Tanauan City, Batangas. In October 2025 she lends ₱80,000 to her kumare, Rowena dela Cruz, who lives in Lipa City. Rowena signs a Promissory Note: payable in full by 31 March 2026, no interest. By April, Rowena has paid only ₱20,000 and stops answering Tess's texts.
Step 1: the demand. On 4 May 2026, Tess sends Rowena a Demand Letter by registered mail with return card, asking her to pay the ₱60,000 balance within 15 days of receipt. The return card comes back signed on 11 May. Rowena does not pay.
Step 2: the barangay? Tess lives in Tanauan and Rowena in Lipa. They live in different cities, so barangay conciliation (settlement talks at the barangay) is not required, unless their barangays adjoin and they both agree to it. If Rowena lived in Tanauan too, Tess would need a Certificate to File Action (the barangay's go-signal to go to court) from the barangay first.
Step 3: filing. Tess fills in the Statement of Claim (Form 1-SCC), signs it under oath, and files it at the Municipal Trial Court in Cities of Tanauan, where she lives. She attaches certified copies of the Promissory Note, her receipts for Rowena's ₱20,000 payment, the Demand Letter and the return card, and pays the filing fees the Clerk of Court computes.
Step 4: the hearing. Tess and Rowena appear on the hearing day, with no lawyers. The judge first tries to get them to settle. Rowena admits the debt and offers ₱10,000 a month for six months. Tess agrees, and the settlement is written down and approved by the court. Had they not settled, the judge would have heard both sides and decided within 24 hours.
What about interest? The note said no interest, so Tess cannot claim the interest she might have earned. But when a debtor is in delay after a demand, the law allows legal interest as damages. Courts have set that rate at 6% a year. You can estimate it with the legal interest calculator.
What Small Claims Covers
Small claims is for money only, up to ₱1,000,000 not counting interest and costs. The Supreme Court raised the limit from ₱400,000 (₱300,000 in municipal trial courts) to ₱1,000,000 in its Rules on Expedited Procedures in the First Level Courts (A.M. No. 08-8-7-SC), in effect since 11 April 2022. Typical claims:
- a personal loan or utang, with or without a Promissory Note;
- unpaid rent;
- payment for services or goods you delivered;
- money due under a barangay settlement or award that was not paid.
It is not for getting a thing back, evicting a tenant or dividing property. Claims above ₱1,000,000 go through the regular rules. If someone paid you with a check that bounced, see what happens if a check bounces.
How a Small Claims Case Goes, in Short
- Demand first. Send a written demand in a way that gives you proof it was received. The court form asks whether you demanded payment, how and when. A demand is also what usually puts the debtor in delay (legally late in paying) under Article 1169 of the Civil Code.
- The barangay, if you live in the same city or town. If you and the debtor are individuals living in the same city or municipality, you usually need a Certificate to File Action (the barangay's go-signal to go to court) first. See do I need to go to the barangay first.
- File the form. Fill in the Supreme Court's Statement of Claim (Form 1-SCC), sign it under oath, attach certified copies of your proof and your witnesses' affidavits, and file it at the first-level court where you or the defendant lives. The Clerk of Court computes the fee under Rule 141 of the Rules of Court. People who qualify as indigent (very poor) can ask to be exempted.
- One hearing. The court sets it no later than 30 days from filing, or 60 days if a defendant lives or does business outside the court's judicial region. Both sides come in person, and no lawyer may appear for a party unless the lawyer is the plaintiff or defendant. The judge first tries to get you to settle. If you do not, the judge decides within 24 hours after the hearing ends, and the decision is final and cannot be appealed.
For the steps and papers, see collecting money through small claims court. For the letter itself, see Demand Letters.
Points People Often Miss
- No written note? You can still file. Messages admitting the debt, bank or e-wallet transfer records and witnesses can prove a loan.
- Missing affidavits. The rules say failing to attach the required affidavits of your witnesses leads to dismissal.
- Missing the hearing. If you do not show up, your claim is dismissed. If the defendant does not show up, the court decides based on what is on file.
- Working abroad. If you have a valid reason not to attend, such as working abroad, a non-lawyer representative may appear for you with a Special Power of Attorney (Form 7-SCC).
- Banks and lenders. A bank or lender with a branch where the defendant lives or does business must file there.
- If the loser still does not pay, ask the court for a writ of execution (an order to enforce the decision). A sheriff can then enforce it against their property.
Common Questions
Kailangan ba ng Abogado sa Small Claims?
No. No lawyer may appear for a party at the hearing, unless the lawyer is the plaintiff or defendant. You fill in the forms yourself. You can still ask a lawyer, the Public Attorney's Office (PAO) or IBP legal aid for advice before the hearing.
How Much Is the Filing Fee?
It depends on the amount you claim, under Rule 141 of the Rules of Court. The Clerk of Court computes it when you file. If you cannot afford it, ask about being treated as an indigent litigant (a party too poor to pay).
Can I File Small Claims While I Am Working Abroad?
You still need a valid Statement of Claim signed under oath. For the hearing, a non-lawyer representative can appear for you with a valid reason and a Special Power of Attorney (Form 7-SCC). See Special Power of Attorney for how to sign one abroad.
Can I Go to the Police Instead? He Just Does Not Want to Pay.
Not paying a debt is generally not a crime, and the police do not collect debts. It becomes a criminal matter only in special cases, such as fraud from the start or a bouncing check. See can you go to jail for unpaid debt.
What If They Still Do Not Pay After the Judge Decides?
File a motion for execution (a request that the court enforce its decision) with the same court. The court then issues a writ of execution, and a sheriff can enforce it against the debtor's property.
Not legal advice. This is general information. For advice on your own situation, consult a lawyer. If you cannot afford one, the Public Attorney's Office (PAO) or an IBP legal aid office may help for free.
Government fees, rules and requirements change, so always check with the office concerned before you go. This page explains the general rules; it cannot tell you how they apply to your own family or case. Last reviewed October 8, 2026.