Changes to the Small Claims Court Rules

This just in: Effective January 1, 2011, the Small Claims Court Rules will be amended.

There are a few changes coming, and this isn't a comprehensive examination of them, but some of the big ones involve recovery of legal costs, which I've blogged about before.

Some of the more technical rules are being changed. For example, there used to be a minimum of $500 on the claim in order to trigger certain costs provisions, and that will be gone. Also, there used to be a provision for successful parties to recover up to $50 for preparing and filing the pleadings. This is gone, replaced by a provision allowing the successful party to recover up to $100 for disbursements associated with preparing the pleadings.

Minor points. The 15% cap is still there for representation fees, so allowing representation costs on a less-than-$500 claim means that the successful represented party can go for up to a whopping amount of legal fees still under $75, by default. (By contrast to self-represented litigants, who can get up to $500 for inconvenience.)

Here's a big one, though: There is currently a half-costs rule for "agents" (i.e. paralegals) and students-at-law, so the 15% cap gets reduced by half for non-lawyers. That's gone. As of January 1st, 2011, a paralegal or student-at-law will be capped at 15%, same as lawyers.

Of course, it still has to be a "reasonable" representation fee - there's nothing automatic about 15%. That said, even at paralegal or student-at-law rates, it will be the rare case where 15% of the amount claimed at Small Claims Court is much more than a 'reasonable' representation fee.

This amendment is a coup for paralegals - whereas, in many cases before, a successful litigant would have to swallow a larger amount of legal fees by hiring a paralegal than by hiring a lawyer, now it will be quite the opposite, that a successful party will likely have a larger proportion of their legal fees covered by a cost award.

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This blog is not intended to and does not provide legal advice to any person in respect of any particular legal issue, and does not create a solicitor-client relationship with any readers, but rather provides general legal information. If you have a legal issue or possible legal issue, contact a lawyer.