An employment law blog for employers and employees.
Published by Sean Bawden of Kelly Santini LLP.
T. 613.238.6321 | sbawden@kellysantini.com | www.kellysantini.com

Tuesday, 1 July 2014

Ontario Small Claims Court Gains New Powers to Dismiss Claims

As of July 1, 2014, the Ontario Small Claims Court has the power to summarily dismiss any claim made to it, “if the action appears on its face to be inflammatory, a waste of time, a nuisance or an abuse of the court’s process.” This change will be welcomed by those who practice in the Small Claims Court and are sometimes forced to respond to such claims.

The Rules

On July 1, 2014, The Small Claims Court Rules, O Reg 258/98 were amended by O. Reg. 44/14 in several important ways. Of relevance to this post is the court’s new power to dismiss claims that it deems to be “a waste of time, a nuisance or an abuse of the court’s process.”

This change is important for two reasons: (1) not all claims brought before the Small Claims Court are meritorious and (2) the rules of the court deem a defendant who does not defend an action to admit that which is claimed against him, her, or it.

Consider, for a moment, the case of Doe v. A & W Canada, 2013 HRTO 1259, in which an individual filed a complaint with the Human Rights Tribunal of Ontario alleging:

As a lesbian feminist, the whole notion of labelling a burger patron as a “Mama” or “Papa”; or “Teen”; based solely on the choice of meal is highly degrading and an attack on my womyn identity.

While that case was brought before the Human Rights Tribunal, similar claims are sometimes brought before the Ontario Small Claims Court.

Unlike the Human Rights Tribunal, however, before July 1st, 2014, the Ontario Small Claims Court had no way to summarily dismiss such claims. Defendants were forced to defend the claim against it or be deemed to admit that which was claimed. Defendants who failed to defend such claims risked having “default judgment” given against them on the basis that they were deemed to have admitted that which was claimed. While plaintiffs have always been required to prove that their claims entitled to damages, even if liability was proven, defendants have often been reluctant to leave such things to chance.

As of July 1, 2014, however, the rules have been changed. New rule 12.02(3) provides that:

The court may, on its own initiative, make the order… staying or dismissing an action, if the action appears on its face to be inflammatory, a waste of time, a nuisance or an abuse of the court’s process.

The rule is important because it gives the court the power to dismiss an action and does not require any party to bring a motion to do so. Subrule 12.02(4) provides the procedure that the court must follow before summarily dismissing any such claim.

Whether the court will regularly employ that rule to dismiss claims at the pleadings stage is yet to be seen. While the Human Rights Tribunal has done a rather good job of summarily dismissing claims, this power is new to the courts and I can foresee reluctance on the part of some judges to dismiss claims in such a fashion.

Fortunately, even if the court does not dismiss the claim at the pleadings stage, a new power given to judges at settlement conferences provides more hope. New subrule 13.05(2)(a)(iii) gives the judge conducting the settlement conference the power to make an order staying or dismissing the action, provided only that the judge provides written reasons for doing so.

Commentary

As someone who both practices in the Small Claims Court of Ontario and teaches both Trial Advocacy in the Small Claims Court and Small Claims Court Practice, I welcome these changes to the rules.

As mentioned, not all claims to the Small Claims Court are meritorious. On a not infrequent basis when I advise someone that their claim is likely to be unsuccessful, the response I will receive is something to the effect of, “then I will go to Small Claims Court.” I have always found this position difficult, because the Small Claims Court, for all its efficiencies and leniencies, is still a court of law. One cannot avoid the law simply by going to Small Claims Court.

Moreover, as someone who defends claims made in the Small Claims Court, it comes as a relief that there is now hope that not all claims will have to go to trial to be dismissed. Unlike the rules governing cases in the Ontario Superior Court, the Small Claims Court Rules do not really provide a means to dismiss claims on a summary basis. True, rule 12.02 has long provided that the court may, on a motion, strike out or amend all or part of any document that is inflammatory, a waste of time, a nuisance or an abuse of the court’s process, that rule required the defendant to bring a motion, which involved costs and delays. Now, knowing that the court may dismiss the claim at the settlement conference, which is both mandatory and free, parties may be more inclined to simply wait until that event and then avail themselves of the opportunity. Even if the judge conducting the settlement conference is reluctant to dismiss the claim, resort can still be had to the powers under rule 12.02.

Takeaways for those with Labour Pains

With the increase in the Small Claims Court’s monetary jurisdiction to $25,000, more and more claims for wrongful dismissal are being brought before Ontario Small Claims Court. (Indeed as I type this post I continue to wait for a decision concerning a wrongful dismissal matter argued before the Small Claims Court at Thunder Bay.) However, not all wrongful dismissal claims have merit. In those cases, it will be important for defendants to have claims dismissed as early and as efficiently as possible.

If you have been sued in the Ontario Small Claims Court, whether for an employment-law matter or otherwise, and you are looking for a lawyer to defend your interests on a pragmatic, effect and cost-effective basis, the professional, experienced and cost-effective litigation lawyers at Ottawa's Kelly Santini LLP would be happy to be of service to your business or organization.

To reach the author of this blog, Sean Bawden, email sbawden@kellysantini.com or call 613.238.6321 x260.

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As always, everyone’s situation is different. The above is not intended to be legal advice for any particular situation. It is always prudent to seek professional legal advice before making any decisions with respect to your own case.

Sean Bawden, publisher of Labour Pains, can be reached by email at sbawden@kellysantini.com or by phone at 613.238.6321.

Sean P. Bawden is an Ottawa, Ontario employment lawyer and wrongful dismissal lawyer practicing with Kelly Santini LLP. He is also a part-time professor at Algonquin College teaching Trial Advocacy for Paralegals and Small Claims Court Practice.



2 comments:

  1. Arthur Gallant1 July 2014 at 11:06

    Do these new powers only apply to claims filed as of today or there after? Could a deputy judge apply subrule 13.05(2)(a)(iii) for a claim filed before the new rules came into effect but in which a settlement conference is scheduled but hasn't been conducted yet.

    ReplyDelete
  2. I have reviewed both O Reg 44/14 and the Rules and see no transition provisions. Accordingly, I have to assume that deputy judges, starting tomorrow, can start exercising these powers with respect to any claim, including those already in the system.

    It is conceivable that a claim may be dismissed at a settlement conference as early as tomorrow morning.

    ReplyDelete