Lawsuits to collect debts are usually filed in state courts—and may be filed in small claims courts, depending on the amount of the debt and the small claims court’s jurisdictional limits (the maximum amount of a claim that can be filed in the court).
In Minnesota, lawsuits to collect debts are typically filed in the state court system. The venue for filing a debt collection lawsuit depends on the amount of the debt. For smaller debts, the claim may be filed in Minnesota's Conciliation Court, commonly known as small claims court, which is designed to handle disputes involving limited amounts of money without the need for an attorney. As of the knowledge cutoff in 2023, the jurisdictional limit for small claims court in Minnesota is $15,000. Claims exceeding this amount would need to be filed in the District Court. It's important for debtors and creditors to be aware of the statute of limitations for debt collection in Minnesota, which varies depending on the type of debt but generally ranges from two to six years. Once a lawsuit is filed, the debtor has the opportunity to respond and potentially contest the debt. If the creditor prevails, the court may issue a judgment for the amount owed, which can then be used to pursue collection activities such as wage garnishment or bank levies.