Guidelines for Seeking Damages in Dispossessory Actions in Georgia Magistrate Court
Knowing the requirements and limitations of Georgia magistrate courts is important to understanding when litigating in multiple courts – i.e., claims and counterclaims being severed and partially transferred to state court – is a potential outcome. Hiring an attorney who knows the nuances of the interplay between Georgia's magistrate courts and state courts will allow the landlord to effectively litigate its dispossessory action.
Georgia's magistrate courts are courts of limited jurisdiction. Even though the jurisdictional limitations are enumerated in O.C.G.A. § 15-10-2, questions have nonetheless arisen regarding statutory interpretation, particularly with respect to dispossessory actions that also involve claims and/or counterclaims seeking monetary damages in excess of the magistrate courts' jurisdictional limits. Pursuant to O.C.G.A. § 15-10-2(5), a claimant in magistrate court may not seek damages in a civil suit in excess of $15,000. That being said, O.C.G.A. § 15-10-2(6) provides magistrate courts an independent basis to exercise jurisdiction over the issuance of writs and judgments in dispossessory proceedings. This begs the question as to whether the $15,000 jurisdictional cap set forth in O.C.G.A. § 15-10-2(5) serves as a limitation on the amount of rent and other damages that a landlord may seek in a dispossessory action filed in magistrate court under O.C.G.A. § 15-10-2(6).
The Georgia appellate courts have attempted to harmonize the interplay between Sections (5) and (6) by distinguishing between monetary claims typically sought by the landlord in a dispossessory proceeding, such as for past due rent, late fees and attorneys' fees (i.e., "Section 6" cases), versus other contractual or tort claims, even though said claims may arise in the context of the landlord-tenant relationship (i.e., "Section 5" cases). For example, the Georgia Court of Appeals has clearly stated that the $15,000 cap set forth in O.C.G.A. § 15-10-2(5) does not apply to claims arising under O.C.G.A. § 15-10-2(6). See Atlanta J's, Inc. v. Houston Foods, Inc., 237 Ga. App. 415, 417, 514 S.E.2d 216, 218 (1999) (overruled on other grounds) ("[n]othing in the statute suggests that, where the magistrate court acquires jurisdiction under subsection 6, the extent of such jurisdiction is circumscribed by the [monetary] limitation set forth in subsection 5."). See also Blocker Farms of Florida, Inc. v. Bell, Case No. 06:13-cv-067, 2014 WL 12573839 (S.D. Ga. Sept. 15, 2014) (explaining when a magistrate court obtains jurisdiction under O.C.G.A. § 15-102(6), the $15,000 jurisdictional limit does not apply); North Avenue Nate, LLC v. Valentino, Civil Case No. 1:17-cv-02160-SCJ-RGV, 2017 WL 10410659 (N.D. Ga. Sept. 1, 2017) (same). Put simply, under Section 6, a landlord in Georgia can initiate a dispossessory action in magistrate court seeking both tenant removal and a monetary judgment in excess of $15,000.
On the other hand, the Georgia Court of Appeals has held that the magistrate court does not have jurisdiction to hear a tenant's counterclaims, whether sounding in contract or tort, where the tenant is seeking more than $15,000 – even though the claims are raised in a dispossessory proceeding and arise in the context of the landlord-tenant relationship, because those claims are treated as "Section 5" claims.1 Smith v. Bell, 346 Ga. App. 152, 156, 816 S.E.2d 698, 702 (2018). See also WPD Center, LLC v. Watershed, Inc., 330 Ga. App. 289, 290, 765 S.E.2d 531 (2014) (holding the magistrate court lacked jurisdiction to consider counterclaims in a dispossessory proceeding where the counterclaims exceeded the jurisdictional limitation for magistrate court). For example, in Roney v. Wright, the landlord filed a dispossessory action in magistrate court, and the tenant asserted counterclaims against the landlord for slander, wrongful eviction, punitive damages, lost wages, physical and mental distress, and attorneys' fees in an amount greater than $15,000. 362 Ga. App. 714, 715, 870 S.E.2d 64, 65 (2022). The magistrate court found that it lacked jurisdiction to hear the tenant's counterclaims and transferred the counterclaims to state court. Id. Similarly, in Smith v. Bell, the Court of Appeals acknowledged that the magistrate court lacked jurisdiction to adjudicate the tenant's counterclaims for misrepresentation and breach of contract because the tenant was seeking in excess of $15,000. 346 Ga. App. at 153-56.
Despite the foregoing jurisdictional limitations, a tenant is still required to assert compulsory counterclaims in a dispossessory proceeding, even though the magistrate court would not have jurisdiction to hear them because the damages sought are in excess of $15,000.00. Smith, 346 Ga. App. at 156; Atlanta J's, Inc., 237 Ga. App. at 417. As explained in Setlock v. Setlock, "[t]o avoid potential waiver of [the tenant's] counterclaims that arose out of the transaction or occurrence that was the subject matter of [the landlord']s dispossessory action, [the tenant] was required to raise them in magistrate court" even though raising them would not confer jurisdiction on the magistrate to adjudicate the claims. 286 Ga. 384, 385-86, 688 S.E.2d 346, 347-48 (2010). Indeed, the proper procedure is for the counterclaims to be raised in magistrate court during the dispossessory proceeding, and then the court can transfer the counterclaims to state or superior court for resolution. See e.g., Roney, 362 Ga. App. at 715. A party may find it to its advantage to pursue two-front litigation, in part based on the various requirements of each court; however, it may also lead to a delayed and more costly outcome. Therefore, understanding the full scope of how and when a Georgia magistrate court may hear a dispute will be important in pre-litigation planning.
1 There still remains some ambiguity as to whether there could exist some claims that a landlord may seek to assert against a tenant that arise out of the landlord-tenant relationship, but would nonetheless be subject to the $15,000 cap set forth in O.C.G.A. § 15-10-2(5)—such as a claim for conversion.