New Monetary Limit in Small Claims and the Enhanced Role of the Civil Resolution Tribunal
The Government of British Columbia recently announced significant changes to how legal disputes worth less than $5,000 and between $5,000 and $35,000 get resolved.
As of June 1, 2017, the Civil Resolution Tribunal (“CRT”) is assuming jurisdiction in respect of disputes under $5,000 in a number of areas which were formerly under the jurisdiction of the Provincial Court of British Columbia (Small Claims).
The CRT is an online tribunal that already accepted strata property disputes. With the upcoming amendments, the CRT will assume authority and jurisdiction to resolve disputes under $5,000 concerning:
- debt or damages;
- recovery of personal property;
- opposing claims to personal property; and
- demanding performance of an agreement about personal property or services.
The CRT continues to not have jurisdiction to resolve disputes concerning, among other things:
- libel, slander or malicious prosecution;
- constitutional claims;
- claims against the government; and
- disputes where the CRT declines to hear the matter.
Appeals from decisions of the CRT continue to be pursued through the Provincial Court.
Coupled with the change to the purview of the CRT on June 1, 2017 is a change in the monetary limit of Small Claims from $25,000 to $35,000.
At the time of this article, information on the transition provisions that will apply to this change is relatively scant. What is indicated by the Provincial Court website includes:
- claims already commenced in Small Claims can increase the amount of the claim by is by following Rule 8 (the Rule concerning changing or withdrawing a claim or reply); and
- claims commenced in the Supreme Court that are now within the Small Claims jurisdiction can continue in Supreme Court, but may be bumped down to the Supreme Court at the application of a party to the proceeding or on the discretion of a Judge or Master per s. 15 of the Supreme Court Act.
A number of points of clarification may be required, for example, how the new legislation would concern costs in settlements that are within the Small Claims jurisdiction, costs where the amount recovered is within the Small Claims jurisdiction or potential wasted steps and costs if a proceeding had already been transferred from Provincial Court to Supreme Court and may now be transferred back.
In consideration of the information known to date, prudence suggests that:
- settling or resolving Supreme Court matters that may be worth less than $35,000 but more than $25,000 prior to the change in the Small Claims limit may be beneficial as, afterwards, a party may no longer be entitled to court costs they were entitled to prior to the transition;
- resolving Small Claims matters that may be worth more than $25,000 prior to the transition provisions -whether through settlement or at trial- runs the risk of not recovering damages that might otherwise be recoverable after June 1, 2017;
- negotiations of the settlement Small Claims matters worth more than $25,000 should keep in mind that the claimant appears to have the right to increase their claim to more than $25,000 after June 1, 2017;
- there may be further as-of-yet unknown challenges, difficulties and risks and further legislative clarification for claims worth between $25,000 and $35,000 that are note known which makes commencing and continuing claims in that range, whether in Small Claims or Supreme Court, challenging and risky.
In this writer’s view, the expanded purview of the CRT will likely shift a number of relatively small and simple matters out of Small Claims, thereby freeing up Court resources, and reflects and ought to assist in the realization of the mandate of the CRT in respect of such disputes. The CRT’s mandate being:
- to provide accessible, speedy, economical, informal and flexible dispute resolution;
- to apply principles of law and fairness, and recognize any relationships between parties to a dispute that will likely continue after the CRT proceeding is concluded;
- to use electronic communication tools to facilitate resolution of disputes brought to the CRT; and
- to accommodate, so far as the CRT considers reasonably practicable, the diversity of circumstances of the persons using the services of the CRT.
There has long been a rallying cry for the jurisdiction of Small Claims to be expanded. Although the monetary jurisdiction increase does not go as far as many have called for, it does recognize that often Small Claims matters involve complex legal proceedings concerning sums of money which are, to the parties involved, significant. The increased monetary jurisdiction provides a little more room for it to make economic sense for parties to retain legal representation and provides a broader range of disputes with access to what is often the cheaper and faster Small Claims process as compared to the Supreme Court.