The New Small Claims Court Procedures in Ontario

Felicia Zipete

The Small Claims Court provides an informal and inexpensive process for settling disputes. To ensure the simplicity of the process, the court will only entertain monetary and property claims up to $10,000. If your claim exceeds these limits you may still wish to use the small claims procedure for the ease, speed and cost at which disputes are resolved. You must, however, be willing to waive your right to claim any amount over the $10,000 limit. Parties may represent themselves in simple disputes and may want to retain legal experts for more complex matters. The Small Claims Court has its own new rules of procedure as described as below.

Commencing the Claim

The person commencing the claim will be called the “Plaintiff”. A claim can be commenced by filing a “Plaintiff’s Claim” with the court together with the required fee. The claim must set out the monetary value of the claim and a short summary of the facts. As well, all documents that the plaintiff intends to rely upon must be submitted together with the claim. On filing the claim and the supporting documents, the court clerk will issue the claim.

Serving the Defendant

Generally, the plaintiff, or a representative of the plaintiff, must personally provide a copy of the claim in person to the defendant within 6 months of the claim being issued by the court. This is known as “personal service”. If it is not possible or practical to personally serve the claim upon the defendant, the rules provide for alternative methods to serve the claim upon the defendant. If both personal service and the alternate methods are impractical, the court may allow a final method of providing the claim to the defendant known as “substituted service”. In order to serve the claim by substituted service, the plaintiff obtain the permission of the court, which can be done by way of a motion.

The Defence

Upon receiving the claim, the defendant has 20 days within which to file a “Defence”. The defendant may admit the claim, in which case it is advisable for her or him to pay the outstanding amount to the plaintiff directly in order to avoid having a judgment entered against her or his name. If the defendant disputes part or whole of the claim, he or she may summarize his or her Defence and submit the supporting documents. The defendant may also want to bring her or his own claim against the plaintiff, known as a “Counterclaim”; or, a claim against a third party, known as a “Third Party Claim”. Such Counterclaims and Third Party Claims can be filed at the same time as the Defence, or with permission of the court, such claims can be raised any time before the trial. If the defendant fails to file a Defence within the 20 day time period, the plaintiff may pursue a motion for default judgment. The defendant’s failure to reply would enable the court to enter a judgment against the defendant in respect of the claim without any further notice to the defendant.

The Settlement Conference

Within 90 days of the first defence being filed, a mandatory settlement conference is held before a judge. The judge that presides over the conference will not be the same judge that conducts the trial; this ensures that the parties are able to speak freely and openly.

The purpose of the conference is to:

• resolve or narrow the issues of the claim(s);
• expedite the disposition of the claims(s);
• encourage settlement of the claims(s);
• assist the parties in effective preparation for trial; and,
• provide full disclosure between the parties of the relevant facts and evidence.

All parties are required to file with the court and serve upon the other parties all documents upon which they intend to rely at least 14 days prior to the conference, together with a list of their proposed witnesses. Failure to attend a conference or failure to file the conference material can result in costs (a financial penalty) being awarded against the defaulting party.

Various orders can be granted at a settlement conference including a final order by consent, which disposes of the matter. The opinion of the judge should be given serious consideration in determining whether to continue or resolve the claim(s). The conference can result in a positive outcome if both parties participate actively and honestly. At the conclusion of the settlement conference if either party still wishes to proceed to litigation in the Small Claims Court they may request the court to set a date for trial.

The Trial & Judgment

The trial will involve presentation of the evidence by both the plaintiff and the defendant. The evidence can include written statements, witnesses and any documents in support of the claim and defence. Both parties will have the opportunity to cross-examine each other’s evidence. The trial will typically last anywhere from half an hour to a full day. Failure to attend a trial can result in the trial proceeding in the absence of one of the parties or in the entire case being struck out. Usually, a judgment is rendered by the court immediately after all the evidence is heard. It may, however, be necessary for the court to review documents and evidence and render a judgment after the hearing.

Costs

A losing party may be required to pay the winning party’s reasonable disbursements and reasonable legal fees. An unrepresented successful party is also entitled to a maximum of $500 as compensation for inconvenience.

Appealing a Small Claims Court Judgment

A judgment from the small claims court can be appealed provided that the claim was for more than $500. The appeal procedure can be lengthy, expensive and complex.

Fees

Initiate an Action in the Small Claims Court ($800.00 plus GST, disbursements and 25% of any amounts recovered)

Disbursements include issuing and filing all court documents and service of documents on all parties