The Small Claims Court in Ontario provides parties to a civil lawsuit with access to an accelerated and cost-effective process for resolving their dispute. The Small Claims Court has jurisdiction to hear claims with a monetary value of up to $25,000.00, but a party can still use the Small Claims Court as the forum for hearing his/her case if willing to abandon any claim for funds over that threshold. The typical steps in a Small Claims Court proceeding are as follows.
In the initial stage, the plaintiff commences the proceeding by preparing a Plaintiff’s Claim. This document sets out the nature of the claim(s), the facts as portrayed by the Plaintiff, and usually includes any documents on which the plaintiff intends to rely. The Plaintiff’s Claim is served on the defendant, and proof of service is filed with the Court. The defendant then has a limited period of time in which to prepare, serve, and file responding materials in the form of a document called the Defence. The Defence includes the defendant’s response to the claim(s), the defendant’s version of the facts, and also includes any documents on which the defendant intends to rely. It is also possible for the defendant to make a counterclaim against the plaintiff or a third-party, and this is accomplished by preparing, serving, and filing a Defendant’s Claim.
The Court then schedules a Settlement Conference, which must occur within 90 days of the Defence being filed. At least 14 days prior to the Settlement Conference, the parties must exchange and file a List of Proposed Witnesses, which is the list of people they would each call as witnesses at trial. Also, the parties must serve and file any additional documents on which they intend to rely at trial. The Settlement Conference is held before a Judge or a Deputy Judge, and the purpose of the Court appearance is to explore the possibility of settlement, narrow the issues, and to ensure that there are no procedural matters to be resolved prior to Trial.
Throughout the process, the parties are each entitled to bring Motions as may be required. A Motion is usually a mechanism for obtaining some type of interim (i.e. during the proceeding) relief, and typical examples are Motions requiring a party to produce copies of certain documents or Motions requiring a party to take some specific action while the proceeding is ongoing.
The parties will usually exchange Offers to Settle during the proceeding, and these are formal statements of their respective proposals for settlement. There can be significant costs consequences to making an Offer to Settle, and so it is prudent to make reasonable and generous settlement proposals as early as possible in the proceeding.
At a Trial, the parties present their evidence to the Court by calling witnesses who give oral testimony and having documents and other items admitted as exhibits. Each party also has an opportunity to make an opening statement and closing submissions. The Judge hearing the Trial may render a ruling immediately or may reserve his/her judgment until a later time.
If a party is successful at Trial, then he/she is usually awarded a fixed sum of money. The successful party is also usually awarded costs, which is an award to reflect the fact that he/she may have incurred legal expenses as a result of the proceeding. Costs awards in the Small Claims Court are typically limited to 15% of the amount claimed, but if the parties made Offers to Settle before the Trial, the Judge will review those proposals and the “cap” on costs awards may be varied as a result.
Even when a party is successful at Trial, it is no guarantee that he/she will actually be paid. The Small Claims Court provides various mechanisms for enforcing a Judgment, including garnishment, seizure and sale of property, registration of a writ of execution with the Sheriff, and contempt orders.
If you would like to discuss a possible proceeding in the Small Claims Court, or you are currently involved in such a proceeding, please feel free to visit the Civil Litigation section of our website or to contact us to schedule a consultation.