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Consequences for not having a matter placed into Simplified Procedure

Simplified Procedure

In today’s age of litigation, it is common to see claims for $1 million and above.  However, what about claims that are not within the ambit of Small Claims Court (i.e. under $25,000).  To address these type of Claims, the Court created a different category for addressing certain Claims; Simplified Procedure.

The purpose of Simplified Procedure is to address claims that fall between $25,000 to $100,000 by streamlining the action, so that it is conducted in a cost-effective manner, given the claim amount being sought.  The Rules of Civil Procedure also limit examinations for discovery for these claims (two hours for each party) and provide for an additional Schedule in the affidavit of documents, amongst other directions.

In this recent Court of Appeal case, Filice v. Complex Services Inc, the Plaintiff/Respondent commenced an action for constructive dismissal.  Before the trial commenced, a summary judgment motion was brought which struck all of the other claims, including a claim for punitive damages.  At that time, the claim fell within the purview of Simplified Procedure, but the Plaintiff/Respondent never had the case transferred into Simplified Procedure, and the Defendant/Appellant never requested that it be transferred.  This was a loophole that was explored by the Court of Appeal.

The case had a seven day trial, with the Plaintiff calling seven witnesses, which the Court of Appeal found excessive.  At the end of the trial, the Plaintiff was awarded costs of $82,600. Accordingly this case was within the claim limits of the Simplified Procedure.  However, this was appealed by the Defendant/Appellant, on that basis that the Plaintiff/Respondent, although successful at trial, did not require the length of trial that transpired.

Rule 76.13 stipulates that a plaintiff “shall not recover any costs” if a claim that properly falls within the Simplified Procedure, is not pursued under Rule 76.  While that consequence is mandatory, there is discretion in the court to depart from it if the court considers it reasonable to do so.  The Court of Appeal decided to use its discretion.  The costs of the trial were reduced to $40,000.00, all inclusive, but costs were still awarded.

The Defendant/Appellant was awarded $10,000 in costs for success on the Appeal.

Why wasn’t the Plaintiff/Respondent not shut out on costs, given that the action was not transferred into Simplified Procedure?  The Defendant has to object if a case that should properly be brought under Simplified Procedure, is not.  By not objecting, as this case demonstrates, the Court has discretion to award costs, for cases not properly brought under Simplified Procedure.

Objecting to having a matter placed into Simplified Procedure is an often overlooked measure, but can be used to either argue against the awarding of costs altogether, or to reduce costs, as this case demonstrates.

Something to keep in mind on future claims!

If you have any questions about Simplified Procedure actions, do not hesitate to contact me.

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