I. Increases in Small Claims Court and Simplified Procedure Claim Limits
A recent announcement by the Ontario Ministry of Attorney General has advised that, effective January 1, 2020, a party will be permitted to claim up to $35,0001 in Ontario Small Claims Court proceedings, and up to $200,0002 in Rule 76 Simplified Procedure proceedings in the Ontario Superior Court of Justice.3
Ontario Regulation 344/19, which amends the Rule 76 Simplified Procedure effective January 1, 2020, also includes a number of other changes to the Simplified Procedure, some of which are highlighted below.
II. New Limitations on Cost Recovery in Simplified Procedure Actions
The amendments also include a new restriction on the quantum of costs which may be recovered by a party in a Rule 76 Simplified Procedure action commenced on or after January 1, 2020. Specifically, in such proceedings, no party will be permitted to recover costs exceeding $50,000, or to recover disbursements exceeding $25,000, exclusive of HST.4 These restrictions will not apply in the case of an action commenced before January 1, 2020.
III. Examination for Discovery Time Limits Increased
Currently, the time for oral examinations for discovery to be conducted by each party under the Rule 76 Simplified Procedure is limited to a total of two hours. With the amendments to Rule 76, this time limit will now be increased to three hours effective January 1, 2020.
IV. Trials Shall Now Be Limited to 5 Days for Rule 76 Simplified Procedure Actions
To balance the expanded scope of the Simplified Procedure with its purpose as an expedient means to resolve disputes, the amendments will now place a 5-day limit on Rule 76 Simplified Procedure trials, and no longer distinguish between ordinary trials and summary trials, while instead prescribing a new procedure5 that applies to all trials of Simplified Procedure actions.
V. Continuing Existing Actions in the Small Claims Court and Under Rule 76
Parties to litigation may be wondering whether existing Simplified Procedure claims between $25,001 - $35,000 may be transferred to the Small Claims Court as of January 1, 2020, and whether plaintiffs having existing actions for claims between $100,001 - $200,000 may “opt in” to the Simplified Procedure as of January 1, 2020. In short, the answer is “yes”.6
In determining whether it will be appropriate to transfer such an existing Simplified Procedure action to the Small Claims Court, or to continue an existing Ontario Superior Court of Justice action pursuant to the Rule 76 Simplified Procedure, parties will need to consider several factors, including: (i) the current stage of the proceeding, and the costs which have already been incurred; (ii) the need for oral examinations for discovery, and the time required for them, which examinations are not available in the Small Claims Court; (iii) the restrictions on costs recovery in the Small Claims Court, where the general rule is that no party is permitted to recover costs exceeding 15 percent of the amount of the claim, exclusive of disbursements;7 and (iv) the amount of trial time needed.
How these upcoming amendments will impact wait times in Ontario Small Claims Courts, and in the Superior Court of Justice, remains to be seen.