As the world becomes increasingly interconnected, we encounter increasing numbers of cases where individuals or corporations from the United States, the UK and even as far as China must, unfortunately, sue in Ontario. Toronto Small Claims Court, in particular, often sees cases between plaintiffs and defendants from other provinces and countries. And so: can the Small Claims Court procedure be used to assist a non-resident of Ontario to enforce rights under a contract made with an Ontario resident? Can Ontario residents do the same outside Ontario? In most cases, this is possible under Ontario law as it now stands. Below we offer answers to some of the most common questions related to the topic.
Can a company or individual from another country or province make a claim in Ontario Small Claims Court?
Small Claims Court procedural rules do not include any specific limits which would prevent a foreigner or resident of another Canadian province from starting a lawsuit in the Ontario Small Claims Court. Individuals or corporations from other provinces, the United States, the UK, Australia, China or any other place in the world can typically sue an Ontarian in Ontario Small Claims Court as long as two conditions are met. First, the amount of the claim should not exceed the monetary limit of the Small Claims Court. For now, this is $25,000 Canadian dollars. Second, the defendant against whom the claim is being filed must do business or reside in the province and be otherwise subject to the jurisdiction of the Small Claims Court in which the claim is filed.
Can an Ontario company or resident sue someone from another province or foreign country in an Ontario Small Claims Court?
The answer is yes. However, there is one condition: the plaintiff must show that the cause of action for the claim arose in Ontario. A cause of action is a fact or a set of facts which establishes that a dispute is connected to Ontario and therefore allows a claim to be filed in Ontario. For example, if a contract for a sale was signed in Toronto, the goods were shipped from Toronto and payment for goods was supposed to be received in Toronto, we can say that the cause of action arose in Toronto, Ontario even if the purchaser of the goods lives or works elsewhere.
Can a judgment issued by a Small Claims Court in Ontario be enforced elsewhere?
An Ontario judgment is generally enforceable in other provinces of Canada. All Canadian provinces except Quebec have laws which allow anyone to collect money based on a judgment issued in another province. These laws are similar across provinces, and typically require the person looking to collect money to register a judgment from another province with a court in the province where the plaintiff seeks to collect money under the judgment. Quebec has its own rules. Some American states have legislation that recognizes Canadian judgments as valid and allows the enforcement of these judgments under certain conditions. Other states and countries may have their own rules.
Can a judgment issued in another Canadian province or the USA be enforced in Ontario?
The answer is yes. A judgment from another province may be registered with a court in Ontario and then be enforced in the same way as a judgment of the Ontario court. This registration is done by filing a motion with the court. Court considers the motion and registers the extra-provincial judgment to be enforced in Ontario.
This is somewhat different when it comes to judgments issued in Quebec, some states in the USA and certain other countries. Such foreign judgments can be enforced in Ontario, but the process is somewhat more complicated. The rules require a holder of foreign judgment to file an action to obtain an Ontario court decision confirming that the judgment can be enforced.
It must be noted that it does not matter which court has issued a judgment in another province or country. If the amount of judgment is within the monetary jurisdiction of the Ontario Small Claims Court, an out-of-province or foreign judgment may be registered or confirmed by this court. For example, if a Superior Court in British Columbia or Alberta issued a judgment for $20,000, the judgment can be enforced in Toronto Small Claims Court – there is no need to apply to the Superior Court for enforcement.