Small Claims
Small Claims Court in Canada
- What’s the difference between Small Claims Court and other courts?
- What kind of cases can go through Small Claims Court?
- Should I or Shouldn’t I Sue?
- What is the process or procedure?
- Counterclaim
- Small Claims Court Trial in Canada
- Judgement and Appeal
- Can I Appeal?
What’s the difference between Small Claims Court and other courts?
In Small Claims Court, the rules and procedures are less complicated and less formal so that people can more easily represent themselves. This is why it is often called “the people’s court.” It can also be more economical to go through Small Claims Court because people often don’t use a lawyer and because the fees for filing are usually less expensive.
The Judge in Small Claims Court is often experienced in working with self-represented parties and will not expect you to speak like a lawyer or argue legal technicalities.
Many government and court websites will provide information to the public which explains Small Claims Court, its procedures, and the paperwork required when suing someone.
What kind of cases can go through Small Claims Court?
There is always a maximum amount that can be claimed in Small Claims Court. It differs from province to province. While the amounts used to be much lower, like $5,000 or $10,000, these maximums are being raised over time. In some provinces, the amount is $20,000, and in some it is as high as $50,000.
One result of these increases is that even though people use Small Claims Court, they may be more likely to hire a lawyer to represent them. You may want to consider the pros and cons of hiring a lawyer to represent you in Small Claims Court, especially if you are suing a company or a rich person who will be hiring a lawyer.
If your claim is near the maximum limit, you may want to consider whether you should limit your claim to the maximum allowable amount and still proceed in Small Claims Court. For example, if you are suing your neighbour for $22,000 and the maximum allowable amount in your province in $20,000, you can still sue in Small Claims Court, but only for the $20,000. You are not allowed to then sue in another court for the remaining $2,000, nor are you allowed to sue again or break the lawsuit into two separate lawsuits to try to get the rest of the amount.
Typical claims in Small Claims Court include suing for damages, insurance claims, contract disputes, consumer claims (such as defective merchandise, poor workmanship, warranties) and failure to pay certain kinds of debts.
Generally speaking, you cannot sue in Small Claims Court for family matters, land title claims, libel or slander, false imprisonment and actions against someone who is bankrupt.
Should I or Shouldn’t I Sue?
Questions you should ask yourself include the following:
1) Can I settle without having to go to court?
2) Can someone help resolve the dispute by mediating or negotiating an agreement so I can avoid having to go to court?
3) Do I have the time and energy to spend preparing my case and arguing it in court?
4) Will I regret suing? Will I regret not suing?
5) Even if I went to court and won, is there a good chance the other person can pay me the judgment amount?
If you want to try to resolve the matter outside of court, consider doing the following. First, write a letter to the other party explaining your issue and telling them what you want (the amount of money and when you want it by, or, the performance of an action such as the return of an item and when you want it by). Keep a copy of this and any reply you may receive. If you do end up in Small Claims Court, you may be able to use this.
Offer to have the matter settled by a mediator. The mediator can sit down with both parties and help them work out an agreement. Several kinds of professionals provide mediation services, including lawyers, social workers and professionally trained mediators.
If you write a letter offering to settle the matter, mark the letter “Without Prejudice.” This means that you are not giving up your legal right to seek the full amount if the settlement is refused.
Keep in mind that even if you go to court and win, you may never be successful in collecting on a judgment, particularly if the losing party has no job, doesn’t own assets, or also owes other people money who may be in line before you.
What is the process or procedure?
The following is a very brief overview of the process of going to Small Claims Court. Some further reading will be helpful if you do in fact decide to go to court. Suggested further reading includes court websites, government websites, free legal information services such as Pro Bono clinics, student legal information clinics, the Public Legal Information Association in your province, or library books such as Lee Stuesser’s An Advocacy Primer.
1) Plaintiff (person suing)
Contacting the Court
First, you will need to contact the nearest Small Claims Court to ask them what to do. Generally, most Small Claims Courts will require you to make an appointment with the Clerk. To prepare for the appointment, you will need to create something called a Statement of Claim, as well as bring in relevant documents like contracts and invoices. You will also need to know the Defendants name. These requirements will be discussed in more detail below.
Naming the Defendant
This may seem obvious, but be careful. If you make a mistake when you name the Defendant, even if you win the case you may not be able to enforce the judgment against the Defendant. Don’t use nicknames or shortened versions of a persons name; use their legal name.
If you claim against an incorporated business, you will need to name the corporation as the Defendant, using the corporation’s legal name. Additionally, you will want to know the names of the directors or owners and the location of the registered office or place of business. You can find this out by paying a fee and conducting a name search at the Corporations Branch in your province. Keep in mind that some businesses are not corporations. If you are suing a business that is not incorporated, you should name both the business and the person who runs the business as Defendants.
Statement of Claim
This is an outline of the reasons the Plaintiff is suing, and the remedy the Plaintiff is seeking (such as money, or requiring the Defendant to do something). The Statement of Claim should include the details of the problem including dates, times and places, and should be accompanied by relevant documents like contracts and invoices. The Statement of Claim is usually in triplicate, and needs to be signed by the Plaintiff and then given to the Court Clerk who then submits it to the Judge.
Summons
If the Judge is satisfied that the Statement of Claim and supporting documents show that the Plaintiff may have a valid claim, s/he will issue a Summons. The Summons is a form that tells the Defendant they are being sued and the time and date of the court appearance.
Service
When the Judge issues the Summons, the Clerk keeps a copy and the other two copies go to the Plaintiff. The Plaintiff then has to serve the Summons and the Statement of Claim on the Defendant.
Usually, the Plaintiff must serve the Defendant at least 10 days before the court date.
There are several specific rules for service and the Plaintiff should check with the Court Clerk as to how to serve the Defendant. Usually, it is best to serve the Defendant personally, by handing them the Summons and Statement of Claim and saying “This is a summons”. If the Defendant won’t physically take the Summons, the Plaintiff should tell them they are being served and what the claim is about, and then leave the Summons right beside the Defendant or at their feet.
It is also possible to serve by registered mail or by using a process server.
Costs
The Plaintiff must pay the fee for issuing the Summons, which is based on a percentage of the amount of the claim. The Court Clerk will explain the calculation and the methods of payment available.
2) Defendant
Responding to the Claim
The Defendant may wish to settle the matter. For example, if the Defendant doesn’t dispute the amount of money claimed, s/he can pay the money to the Plaintiff or to the Court prior to the court date. The Defendant should keep proof of payment to show that the matter has been resolved.
Dispute
The Defendant may wish to dispute the claim. If so, the Defendant should file a “Dispute Notice” with the Court Clerk at least 3 days before the court date. This notice will include information about the claim and the reasons why the Defendant is disputing it.
Counterclaim
The Defendant may also claim against the Plaintiff, for example if the Defendant believes the Plaintiff owes them money or should be forced to do something (like return an item).
The Defendant can serve a Notice of Counterclaim on the Plaintiff at least 3 days before the court date, or raise the issue of the counterclaim on the court date. If the Defendant doesn’t serve notice on the Plaintiff in advance of the court date, the Judge may adjourn court to give the Plaintiff time to prepare.
3) Court-Ordered Mediation
Sometimes a Judge may tell the parties to try to resolve the dispute by mediation, before the Judge will set a court date.
4) Case Management Conference
Usually, the court date written on the Summons is the date of the case management conference. This is a meeting with a Judge, the Plaintiff and the Defendant (and their lawyers if any). The parties will try to settle, and if not possible, they will agree on certain matters regarding the trial itself.
Procedure at the Conference
The Judge at the conference will not be the Judge at trial, so parties can speak freely at the conference without prejudicing their case if they do go to trial later. Anything discussed at the conference cannot be used as evidence if the parties do go to trial later.
The Judge will give the parties an opinion on the strengths and concerns of each party’s case. The Judge may also give an opinion on the law that might be applicable to the case. The Judge may also suggest ways to resolve the conflict without going to court. The parties then choose whether or not they will settle.
If the parties decide to proceed to trial, they must discuss with the Judge information about the trial including: the number of witnesses they plan to call, the names and titles of expert witnesses, if any, whether the parties will be represented by a lawyer, what documents may need to be exchanged between the parties, exhibits to be presented at trial and how to do so, and whether there are any special accommodations such as giving witness evidence by phone.
Small Claims Court Trial in Canada
Trial
The Plaintiff has the burden of proof. This means, s/he must show that the Defendant should have to pay money or be forced to do something (such as returning an item). Generally speaking, first the Plaintiff will present evidence at trial (such as showing relevant documents, calling witnesses, testifying on their own behalf) and then the Defendant has the opportunity to do the same.
Evidence
This can include documents such as contracts, letters, cheques, receipts, photos and the like. You should have the original documents in Court, but you can leave a photocopy with the court if you need the original right away.
Witnesses
Both the Plaintiff and Defendant can call witnesses and it is their responsibility to notify witnesses of the date, time and location of the trial.
If a party calls a witness, s/he should have questions ready to ask them. It is advisable to go over the testimony before trial.
Hearsay
A Judge cannot accept evidence that the Plaintiff, Defendant or witness gives about something another person saw or said. It is important to have the person who saw or heard something be a witness themselves, as no one else can tell the Court on their behalf.
Keep in mind
It is important to show up for trial! If the Plaintiff doesn’t show up, the claim can be dismissed. If the Defendant doesn’t show up, the Judge might rule against them.
In most provinces, Small Claims Court Judges are called “Your Honour”.
The Plaintiff will give evidence (documents, witnesses etc.) first and the Defendant can cross examine the Plaintiff’s witnesses. Then, the Defendant will give evidence and the Plaintiff can cross examine the Defendant’s witnesses.
Judgement and Appeal
How will it end? Will I get my money?
After both parties have given their evidence, the Judge can either give her judgment right away or reserve her judgment for later. If the judgment is reserved, it will be mailed to each party later.
The judgment may be for one party (the losing party) to pay money to the other party, or for one party to do something (for example return an item). Sometimes the judgment will include a schedule setting out the date or dates by which the money must be paid, or setting out the date or dates by which one party must do something. If the judgment doesn’t include a schedule, either party can ask the Judge to make one. Either party can also apply to have the schedule changed. If the losing party is told to pay but does not pay, the whole amount becomes due.
As you can see, “winning” doesn’t mean the winning party will actually get the money. Sometimes the losing party will pay the amount owing, but sometimes s/he won’t. The winning party sometimes needs to take further legal steps to collect what is owed to them. If the losing party has decided to appeal, the winning party cannot yet start to take other legal steps to collect. However, after the appeal process is over, the winning party can proceed to try to collect.
The winning party can pay a small filing fee and then file a “Certificate of Judgment” at the courthouse. After that, the judgment can be enforced in several ways. For example, the winning party can garnish the money from someone else (a third party) such as the losing party’s employer or bank. Another example is to ask for what is usually called a “Write of Execution,” which is a court order that gives the Sheriff the power to take and sell items or property of the losing party, in order to pay the judgment owed to the winning party.
This area of the law is not black and white. There are differences between provinces. Keep in mind that you may never be successful in collecting on a judgment, particularly if the losing party has no job, doesn’t own assets, or also owes other people who may be in line before you.
Can I Appeal?
Either party is allowed to appeal, usually within 30 days of the judgment but extensions of time are sometimes allowed. You will need to file a Notice of Appeal along with other documents that the Court Clerk can explain to you. You must set out the reasons (or grounds) for the appeal.
Keep in mind, if you are appealing and the other party is a corporation or a business, you may need a lawyer and there may be different procedures involved.