Steps in the Litigation Process
Prior to commencing a lawsuit in court, it is advised that a demand letter be sent to an individual or corporation who you are in a dispute with. A demand letter is used to encourage payment or rectification of the issue in dispute. The courts have viewed demand letters as a sign of good faith and demonstrates to the other party that you are serious about commencing legal action. While it is used to save you money and time, a demand letter may be ignored, in which case, you will be required to take the next step and determine which jurisdiction your dispute falls under.
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In Ontario, our courts have jurisdiction based on the total amount of money being claimed. If a claim is for $25,000.00 or less, the action must be started in the Small Claims Court. This route provides litigants with a straightforward and accelerated litigation process.
For claims between $25,000.00 and $100,000.00, the proceedings will be commenced under the Simplified Procedure in the Superior Court of Justice. This provides a quick and efficient litigation process due to the shortening of the time parties are allowed for discoveries, use of summary trials and cost consequences for failing to use this process for claims that are within its monetary limit.
All other claims over $100,000.00 are commenced in the Superior Court of Justice under the ordinary procedure by way of an action or application. Depending on the set of facts, one may be a better option than the other. These claims take longer to complete but provide parties a better opportunity to make use of the extended time.
An action is commenced by way of a Statement of Claim. The Statement of Claim details the set of facts and the legal reasons why the Plaintiff is entitled to seek the amount of compensation they are claiming they are entitled to from the other party, known as the Defendant.
In Ontario, a Statement of Claim must be served and filed within two years of the “triggering event” occurring. For example, if you allege that a business partner breached a contract on July 1, 2019, you have until July 1, 2021 to issue and file a Statement of Claim. However, there are exceptions to this strict timeline and relate to the discoverability of a claim. If it is not possible to issue a Statement of Claim within the limitation period, you can file a Notice of Action which provides you with additional time.
If you have been served with a Statement of Claim, you must serve and file a Statement of Defence within twenty (20) days of being served. If additional time is required, a Defendant can serve a Notice of Intent to Defend.
The Statement of Defence is a written answer or reply to a Statement of Claim admitting or denying each and every allegation raised by the Plaintiff and providing any additional facts that the Defendant wishes to assert in opposition to the Plaintiff’s case.
If the Defendant does not file a Statement of Defence within the prescribed time, the Plaintiff can seek to obtain a court order noting you in default and then obtain default judgment against you.
The Defendant also has the option to file a claim against the Plaintiff, known as a Counterclaim. The Defendant can also make a claim against a co-Defendant, known as a Crossclaim. In addition, the Defendant can make a claim against a new party known as a Third-Party Claim. A Reply to both a Counterclaim and Crossclaim is required.
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Within 60 days after the close of pleadings (filing of the Statement of Defence or Reply and Defence to Counterclaim/Crossclaim), parties must agree to a written discovery plan. The discovery plan will set out the scope of the documentary discovery, the names of individuals who will be produced at the examination for discovery and the timeline for completing the examination for discovery.
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Both parties are required to prepare and serve on the other an Affidavit of Documents containing all relevant documents that relate to the issues in dispute. It lists the documents in possession control or power of the party and any privileged or confidential documents that are in a party’s possession but not produced.
The Examination for Discovery consists of each party being asked questions under oath by the other party on issues relating to the litigation and the contents of their Affidavit of Documents. The point of the discovery process is to test the strengths and weaknesses of the other party in hopes that it can facilitate a settlement.
Motions can be brought at any moment in the litigation process. A motion is a hearing before a judge or master on an intermediate or procedural issue needing to be resolved. For example, a party may bring a motion to compel answers from an Examination for Discovery, to bring a Summary Judgement motion to dismiss a case or for substituted service of pleadings.
For all actions commenced in Ottawa, Toronto or Essex, parties are required to attend a mandatory mediation session within 180 days of the Statement of Defence being served. This date can be extended on the consent of all parties.
Parties meet with a neutral mediator who attempts to assist the parties in resolving the issues and reaching a settlement.
If a settlement cannot be obtained, the next step is to attend a trial to resolve the issues in dispute before a judge. During the trial, both parties present evidence to support their position through the calling of witnesses and expert witnesses.
At the end of the trial, a Judge will make a decision that is binding on all parties.
If a party does not agree with the Judge’s ruling, they can appeal the decision to the appropriate court of jurisdiction, either the Divisional Court or the Court of Appeal.