How to File a Counterclaim in Alabama Small Claims Court

When someone sues you in Alabama small claims court, you don't have to play defense only. If the plaintiff owes you money from the same transaction or incident — a contractor who damaged your property while suing you for unpaid work, a landlord who's withholding your deposit while claiming you owe rent — you can file a counterclaim alongside your answer.

What a Counterclaim Is (and When It's Required)

A counterclaim is your own lawsuit against the plaintiff, filed within the existing case rather than as a separate action. In Alabama small claims, you assert it on Form SM-06 (Defendant's Counterclaim), available free at eforms.alacourt.gov.

The critical rule: counterclaims that arise from the same transaction or occurrence as the plaintiff's claim are compulsory under Alabama law. That means if you don't file the counterclaim now, you're permanently barred from suing the plaintiff on those facts later in a separate case. If someone sues you for $2,000 over a home repair dispute and you believe they owe you $1,500 in damages from the same job, you must assert that counterclaim in this case or lose it forever.

Counterclaims based on a completely unrelated transaction are permissive — you can file them if it's convenient, but you're not barred from bringing a separate lawsuit later if you don't.

How to File Form SM-06

Attach the completed Form SM-06 to your Form SM-03 (Defendant's Answer) and file both together with the District Court Clerk within your 14-day answer window. You'll need to include the case number, party names, and a clear description of what the plaintiff owes you and why.

Two requirements that defendants commonly miss:

1. Filing fee — unlike the answer itself (which is free to file), a counterclaim carries a filing fee equal to what a plaintiff would pay to initiate a new case in that monetary tier. Published county schedules range from $61 to $245 depending on the county and the amount you're claiming.
2. Service on the plaintiff — under Alabama Small Claims Rule F, when your answer includes a counterclaim, you must serve a copy of both documents on the plaintiff. Mail them a copy via first-class mail and keep your proof of mailing.

What If Your Counterclaim Exceeds $6,000?

The Small Claims Division has a $6,000 jurisdictional cap, exclusive of court costs and accrued interest. If your counterclaim exceeds that amount, the entire case — including the plaintiff's original claim — gets transferred to a higher court:

• More than $6,000 up to $20,000 — transferred to the regular District Court Civil docket
• Over $20,000 — transferred to Circuit Court

The party asserting the over-limit counterclaim pays the docket transfer fee. Once transferred, the simplified Small Claims Rules no longer apply — the case proceeds under the formal Alabama Rules of Civil Procedure, and corporations must be represented by a licensed attorney.

When Not to Counterclaim

Filing a counterclaim triggers additional costs (the filing fee) and may extend the case timeline. If your claim against the plaintiff is from a completely separate matter, it might be simpler to file it as an independent small claims action on your own terms. Consider whether the claim genuinely arises from the same set of facts before paying the fee.

If you cannot afford the filing fee, file Form C-10-Civil (Affidavit of Substantial Hardship and Order) to request a fee waiver or postponement.

The Alabama Small Claims Response Guide covers the full counterclaim process, including how to decide whether your claim is compulsory, what to write on Form SM-06, and how to serve the plaintiff properly.

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