Simon's Megalomaniacal Legal Resources

Small Claims Court (Ontario) Legal Guide
(20 June 2021)

Chapter 17 - Appeals

1. Overview
   
2. Final v Interlocutory Orders
   (a) Interlocutory versus Final Orders
   (b) Appeals, Judicial Reviews and Interlocutory Orders from Small Claims Court
   
3. Appeal to Divisional Court
   (a) Overview
   (b) Casenote: Action Auto Leasing v Robillard and Payne
   
4. Scope of Appeal Court's Review
   
5. Scope of Appeal Court's Remedies
   
6. Appeal Procedures
   (a) Overview
   (b) Time Limit to File Appeal
   
7. Stay on Appeal
   
8. Judicial Review
   
9. Further Appeal

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1. Overview

Most people believe that if a party is unhappy with the disposition of their case that they have a "right of appeal". This is generally true, but appeal procedures and rights are limited in several important ways, which must be understood to use this right effectively:

• only "final orders" [judgments] of the Small Claims court may be appealed [CJA s.31];
  
  
• appeal courts will give significant "deference" (ie. benefit of the doubt) to trial judges on evidentiary fact-findings - especially credibility findings based on in-person testimony;
  
  
• appeal courts will NOT generally defer to trial judges on issues of jurisdiction and law.

It is wrong to view an appeal as "just another kick at the can". A new trial will not be ordered by a higher court unless "some substantial wrong or miscarriage of justice has occurred" [CJA s.134(6)]. Appeals are limited in very important ways and can be very expensive.


2. Final v Interlocutory Orders

(a) Interlocutory versus Final Orders

Interlocutory orders are the kind of orders discussed in Ch.11: "Motions and Procedural Changes". They tend to deal with procedural matters such as amending pleadings, adjournments, extending time limits, adding parties, and such like.

A "final order" is more typically called a "judgment", and - on its face at least - finally deals with some or all issues raised in the proceeding. This is the most common disposition of a proceeding that goes all the way to trial.

However the line between interlocutory and final orders is not as clear and bright as we might wish for. For example, the distinction between "interlocutory orders" and "final orders" can get blurred where an interlocutory order has the effect of finally disposing of all or part of a proceeding - for example: a losing motion to set aside a default judgment. A more detailed review of the law of this distinction is beyond the scope of this program, but it is recognized by the courts as a vexed area of law.

(b) Appeals, Judicial Reviews and Interlocutory Orders from Small Claims Court

As is made clear in Cudini v. 1704405 Ontario Inc. (Div Ct, 2012), no right of appeal lies from an interlocutory Order made by the Small Claims Court, and leave is not available for that purpose:

[32] As Granger J. concluded through his careful analysis in the Grainger case (at paras. 12 through 22), there is no right to appeal an order of the Small Claims Court other than pursuant to s. 31. There is no right to appeal an interlocutory order of that court, and there is no right to request leave to appeal an order of the Small Claims Court to the Divisional Court or to the Superior Court. Section 31 is the sole source of appeal jurisdiction for an order of the Ontario Small Claims Court.

That said, in Pardar v McKoy (Ont Div Ct, 2011) a party applied to the Divisional Court for judicial review of an interlocutory order of a small claims deputy judge which dismissed their motion to exclude the other side's choice of paralegal counsel. While the Divisional Court has jurisdiction to hear appeals from final orders, and jurisdiction to judicially review interlocutory orders (on grounds of lack of jurisdiction and breach of natural justice), the court here - finding neither of these present - dismissed the application. The court also dismissed on the basis that the application was essentially an attempt to appeal an interlocutory order, which - although not identified by the court as such - is essentially an 'abuse of process'. An almost identical ruling was made on similar procedural facts in Peck v Residential Property Management Inc (Ont Div Ct, 2009).

This issue has been litigated surprisingly frequently, with the cases being essentially of the same effect as Pardar and Peck:

• Mazinani v. Clark (Div Ct, 2014)
  
  This was a judicial review of a costs award on a pre-trial motion. The court dismissed the application as being "an appeal by a different name", not involving any issue of natural justice or jurisdiction.
  
  
• Stewart v. Toronto Standard Condominium Corporation No. 1591 (Div Ct, 2014)
  
  This was a judicial review of a costs award against an unsuccessful party at trial. The Divisional Court granted the application but made it clear that only grounds of natural justice, jurisdiction and bias would give it jurisdiction to do so. Here it found a jurisdictional issue when (in considering CJA 29 and R19.06 to the case) the deputy-judge below wrongly took into account the pre-litigation behaviour of a party in awarding more than 15% of the amount claimed as costs:

  [6] The issue remains whether the deputy judge acted within her jurisdiction to make an award of costs of $1,500 plus disbursements of $500 against the applicant. Section 29 of the Courts of Justice Act, R.S.O. 1990, c. C.34 limits an award of costs, other than disbursements, in a Small Claims Court matter to 15% of the amount claimed “unless the court considers it necessary in the interests of justice to penalize a party or a party’s representative for unreasonable behaviour in the proceeding”. Rule 19.06 of the Small Claims Court rules provides that “if a party has unduly complicated or prolonged an action or has otherwise acted unreasonably”, the court may order an amount as compensation for that conduct.
  
  [7] In my view, rule 19.06, when it refers to “otherwise acting unreasonably”, must be interpreted as referring to the conduct of a party within the proceeding. The rule is not intended to give the Small Claims Court a broad and unfettered discretion to make awards of compensation regarding the conduct of a party that is unrelated to the matter over which the Small Claims Court has jurisdiction. This interpretation is also consistent with the wording of s. 29 of the Courts of Justice Act, to which all of the Small Claims Court rules are subject, that makes it clear that the conduct to be considered when assessing a penalty is conduct in the proceeding.

• Millard, Villada, Ferguson v. Di Carlo (Div Ct, 2014)
  
  A judicial review application of a deputy-judge's dismissal of a motion to dismiss the case was denied when jurisdiction was only one aspect of the Small Claims Court ruling, leading the appeal court to characterize the proceeding as being in essence an appeal of an interlocutory order, which is not provided for under CJA 31.
  
  
• Tran v. Kerbel
  
  Here an appeal (not a judicial review) of an interlocutory order consolidating two Small Claims actions was denied for lack of jurisdiction in the Divisional Court, it being a necessary corollary of CJA 31 (granting an appeal right for final orders from the Small Claims Court over $2,500) that no appeal lay from interlocutory Orders from that court.

The result of these authorities is that in most cases where a party to a Small Claims Court case thinks that a mistake against their interests has been made in an interlocutory order, they should nonetheless argue their entire trial case as best they can, and - if warranted later - appeal the final judgment on the basis of both the alleged interlocutory error and whatever other grounds they may have. The only exceptions to this might be where interlocutory Orders are made that violate natural justice, exhibit judicial bias (a very difficult case to make) or exceed the court's jurisdiction, in which case prompt judicial review may be appropriate.


3. Appeal to Divisional Court

(a) Overview

The first level appeal from a final order of the Small Claims Court lies to the Ontario Divisional Court, but only in proceedings [CJA s.31; Reg 626/00, s.2].:

• for the payment of money in excess of $3,500, excluding costs; or
  
  
• for the recovery of possession of personal property exceeding $3,500 in value.

Case law (see the Casenote below) has held that this threshold is triggered by the amount claimed, not the amount ordered. Additionally, the value of a plaintiff's claim and a defendant's claim may not be totalled to reach this threshold for appeal purposes.

An appeal to the Divisional Court may be heard by one judge of that court [CJA s.21(2)]. No judge may sit in appeal on their own ruling [CJA s.132].

Appeals from orders made on consent of the parties or on issues of discretionary cost awards require leave (permission) of the court to which the appeal is taken [CJA s.133].

The Divisional Court has posted a useful Guide to Appeals in Divisional Court on its website, explaining some of it's procedures to the public.

(b) Casenote: Action Auto Leasing v Robillard and Payne (Ont Div Ct, 2011)

The case of Action Auto Leasing v Robillard and Payne (Ont Div Ct, 2011) considered whether the s.31 Courts of Justice Act rule that a party could only appeal orders "in an action ... for the payment of money in excess of the prescribed amount, excluding costs" [here $2,500] referred to the amount ordered or the amount claimed. The facts were that the plaintiff claimed over $2,500 but received an order for less than that amount. After an extensive historical review of similar provisions using different wording, the court focussed on the phrase "in an action" to reach the conclusion that CJA s.31 refers to the amount claimed and not the amount ordered.

The court held this to be the case despite the unfortunate wording of (then) s.2 of Reg 626/00 ["Small Claims Court Jurisdiction and Appeal Limit"] which set out the 'prescribed amount':

s.2
A final order of the Small Claims Court may be appealed to the Divisional
Court if the order is for,

(a) the payment of money in excess of $2,500, excluding costs; or

(b) the recovery of possession of personal property exceeding $2,500 in
value.

On this provision the court stated:

[38] The regulators have clearly gone beyond what the statute requires. All that s.31 requires is that a monetary amount be prescribed by regulation. Nothing more than a mere number is called for. The regulation, however, purports to rewrite s. 31 in a manner that is completely inconsistent with it.

The court also noted the absurdity of the literal interpretation of Rule s.2 in that it would deny the right of appeal to a plaintiff against a full dismissal.

Note: Reg 626/00 was amended on 01 July 2011 by Reg 317/11 to redress this problem, replacing it with a simple (then) $2,500 limit and abolished the superfluous and conflicting wording that caused the confusion in Action Auto Leasing.

4. Scope of Appeal Court's Review

An appeal is not a new trial. It is an examination of whether the trial court made a significant error.

The standard of review (the legal test the appeal court will apply to determine trial error) for purely legal issues is "correctness": Enbridge Gas Distribution Inc. v. Froese (Div Ct, 2012), para 40.

For fact-findings it is "reasonableness", which is a standard that gives more deference to the trial judge. Findings of mixed fact and law (ie. the application of the facts to a legal test to reach a legal conclusion) will vary depending on whether the material issue is more legal or factual in nature: Dunsmuir v New Brunswick (SCC, 2008).

A court hearing an appeal from a Small Claims Court final order may [CJA s.134(4)]:

• draw inferences of fact from the evidence, except that no inference shall be drawn that is inconsistent with a trial finding that has not been set aside;
  
  
• receive further evidence by affidavit, transcript of oral examination, oral examination before the court or in such other manner as the court directs [rarely done]; or
  
  
• direct a reference (consideration of a purely legal issue) or the trial of an issue [these are very rarely used].

Normally however an appeal court will limit itself to examining the transcript of testimony, exhibits (usually documents), and the written and oral legal arguments of the parties.

The hearing of and use of "fresh evidence" (ie. evidence that was not called at trial) is not a right and is only rarely granted on an appeal. The issue of "fresh evidence" on appeal is a specialized body of law that is not within the scope of this program. The main consideration in such a situation is whether the fresh evidence was available to be called at trial - if it was, this will tend to go against it being admitted as "fresh evidence".

In Vuong v Toronto East General and Orthopaedic Hospital (Ont Div Ct, 2009) the court allowed an appeal where the trial judgment was made in the complete absence of reasons. A new trial was ordered. The court noted that a primary reason for providing reasons was to permit appellate review.


5. Scope of Appeal Court's Remedies

Remedies available to an appeal court include [CJA s.134(1)]:

• making any order or decision that ought to or could have been made by the court or tribunal appealed from;
  
  
• ordering a new trial if "substantial wrong or miscarriage of justice has occurred" [CJA s.134(6)]; such new trial will be limited to aspects of the decision or to only some of the parties, as the error requires [CJA s.134(7)]
  
  
• quash (cancel) the appeal on motion [CJA s.134(3)]
  
  
• make any other order or decision that is considered just.

On dealing with an appeal, an appeal court may also:

• make any interim orders necessary to prevent prejudice to the party pending the appeal [CJA s.134(2)]
  
  
• review only part of an order under appeal [CJA s.134(5)];
  
  
• exercise their jurisdiction in favour of a party even though the party did not appeal [CJA s.134(5)].

6. Appeal Procedures

(a) Overview

Leave is not required to file an appeal of a final order of the Small Claims Court to the Divisional Court.

Court procedures for an appeal to the Divisional Court are complex and they do involve significant expense in court filing fees and obtaining a properly prepared transcript of evidence given at the trial (see Ch.18: "Court Fees").

The Rules of the Small Claims Court do not govern appeals. The Rules governing such appeals are found primarily at R61 of the "Rules of Civil Procedure" (which are the Rules for the Superior Court), and also in the Courts of Justice Act.

Rules of Civil Procedure, R61
As well, the Divisional court has published a general guide on it's appeal procedures: "Guide to Appeals in Divisional Court"].

(b) Time Limit to File Appeal

. Overview

R61.04(1) of the Rules of Civil Procedure (which governs procedures in the Superior Court, including the Divisional Court) establishes that the time limit for appealing a final order of the Small Claims Court to the Divisional Court is 30 days "after the making of the order appealed from". However another Rule allows the Divisional Court to extend that time limit [RCP R3.02(1)]:

R3.02(1)
Subject to subrule (3), the court may by order extend or abridge any time prescribed by these rules or an order, on such terms as are just.

(2) A motion for an order extending time may be made before or after the expiration of the time prescribed.

. Case Notes

1. On considering a defendant's motion to extend time to appeal a Small Claims Court final order to the Divisional Court, the Divisional Court in Feder v Duncan (Ont Div Ct, 2009) stated:

[2] An extension of time may be granted under Rule 3.02(1) (2) and (3) on such terms as are just. The court must consider the ?justice of the case;? factors to be considered include the continuing intention to appeal; the length and reason for the delay; the prejudice to the opposing party arising from the delay; and the merits of the appeal. See Frey v MacDonald (1989), 33 C.P.C. (2d) 13 (Ont.C.A.). See also Duca Community Credit Union Ltd. v. Giovannoli, [2001] O.J. No.36.

On the basis that no appeal proceedings were commenced until after four adjournments of debtor examination had occured (and were then finally denied), the court found that the defendant moving party had no continuing intention to appeal, and dismissed the motion.

2. In dismissing a motion to extend time for filing an appeal of a Small Claims Court final order, the court in Cozzi v Cordeiro (Ont Div Ct, 2009) cited the applicable legal test as follows:

[9] My authority to extend time is found in rule 3.02 [SS: of the Rules of Civil Procedure]. In Kefeli v. Centennial College of Applied Arts & Technology (2002), 23 C.P.C. (5th) 35, Simmons J.A. stated at paragraph 14:

In determining whether to extend the time for filing a notice of appeal, the court will generally consider whether the appellant formed an intention to appeal within the relevant time period, the length of delay, any prejudice to the respondent, and the merits of the appeal.

The general rule that the appellant must have formed an intention to appeal within the relevant time period and must provide a reasonable explanation for any subsequent delay is subject to the broader principle that an extension should be granted if the justice of the case requires it. Frey v. MacDonald (1989), 33 C.P.C. (2d) 13 (Ont. C.A.)

3. The case of 1541094 Ontario Ltd (427/QEW Kia) v Crangle (Ont Div Ct, 2008) touched on the significant issue of the effect of a new trial motion on the running of the 30-day Divisional Court appeal deadline of 'final orders' of the Small Claims Court. The losing defendant made a motion to the Divisional Court to extend time for filing the appeal, which had been deferred pending the outcome of the new trial motion. Without giving articulated reasons, the court denied the motion under the applicable principles set out in Frey v McDonald. As best I can infer, the factor that swayed the court was the parties absence of intention to appeal, electing rather to "'put all his eggs' in the new trial basket".

From this case we can conclude that the running of the 30-day time limit to file an appeal is not delayed by the making of a motion for a new trial, thus apparently leaving parties in such circumstances to have the extension decided on conventional 'extension' law as otherwise set out here.


7. Stay on Appeal

Once an appeal has been filed, all "money judgments" are automatically "stayed" (suspended) until the appeal is disposed of, subject to any appeal court order to the contrary [Rules of Civil Procedure, R63.01].

An award for the possession of personal property is not a money award and would require a motion to the appeal Court for a stay.


8. Judicial Review

Wherever an appeal is not available from a decision or act of a court (or any lower tribunal), it is possible that the matter might be brought before a higher court by way of "judicial review".

Judicial review will normally be limited to issues of juridiction, abuse of process or significant legal error. There is a high degree of deference shown to the lower court in a judicial review.

The law and procedures for judicial review are complex and beyond the scope of this program. The Rules governing judicial review are found at R68 of the "Rules of Civil Procedure" (the Rules for the Superior Court), and also in the Judicial Review Procedures Act.

Rules of Civil Procedure, R68

9. Further Appeal

Further appeal from the Divisional Court lies to the Ontario Court of Appeal, the highest court in Ontario [CJA s.6].

Such appeal is limited to questions of law and questions of mixed law and fact. This means that questions of fact alone - typically credibility findings made by the trial judge - will not be reviewed by an appeal court.

Appeal to the Court of Appeal also requires "leave" (preliminary permission) of the Court of Appeal. This is a way the courts have of pre-viewing a case to determine if there are important enough issues involved to merit it's attention. Procedures for a leave application and appeal to the Court of Appeal are set out in the Rules of Civil Procedure, and are beyond the scope of this program.

Technically, appeal from the Court of Appeal is available, with leave, to the Supreme Court of Canada. However the taking of an Ontario Small Claims Court case that far would be highly unusual (not for lack of will, but for lack of legal significance of the case). What may be very important for a single litigant is not likely to be of pressing policy interest to the higher courts - and in civil cases the courts ARE entitled to restrict their caseload in this way.