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Return to First Part of Chapter
6. Geographical Jurisdiction (Venue)
(a) Overview
Sometimes complex issues can arise over the relationship between the location (both within and outside of Ontario) of the events of the litigation, the part/ies' residence and place of business - and the location (both within and outside of Ontario, and Canada for that matter) of the court where the case will be heard. These are important for determining whether the court that the proceeding was commenced in has "jurisdiction" to hear the matter - an issue is generally referred to as "venue" or "forum". If a defendant feels that the proceeding has been brought in the wrong "venue", this may be included in their Defence.
The issue of "venue" differs from other jurisdiction issues in the sense that the parties' desires can have some influence over the location of the case. A judge's decision on the issue of venue will involve a number of issues such as location of events, parties - and the convenience of the parties.
A key concept involved with determining jurisdiction within Ontario is that of "territorial division", which is the geographical area of any given local court office. Lists of territorial divisions and local court offices are found below.
(b) General Venue Criteria
A claim should be commenced in the local court office of the territorial division of the court [R6.01(1)]:- in which the events and transactions which constitute the cause of action (the basis of the dispute) predominantly took place, OR
- in which - or that is nearest to where - the defendant, or one of the defendants at least, resides or carries on business [R6.01(1)].
The territorial divisions of the Small Claims Court are any county, district or regional municipality - and each of the following as they existed on 31 December 2002 [R1.02(1)]:- The combined area of County of Brant and City of Brantford.
- Municipality of Chatham-Kent.
- Haldimand County.
- City of Hamilton.
- City of Kawartha Lakes.
- Norfolk County.
- City of Ottawa.
- County of Prince Edward.
- City of Toronto.
However, the court has a general authority to order that the action be tried at "another place" if "satisfied that the balance of convenience substantially favours" this [R6.01(2)]. Factors that might be relevant here are the preferences of the parties, the place/s of residence and business of the parties, the availability of witnesses, assets held in the jurisdiction which might be available for collection, travel costs, etc. "Another place" could mean another local court of the Small Claims court, a court in another province - or in another country for that matter. Obviously cases with international involvement can become quite interesting.
The court rules were amended 01 July 2006 to add an additional power for the court on its own, without a motion by a party), "when an action is called for trial or settlement conference" to "order that the action be tried in any other place where it could have been commenced under this rule" [R6.01(3)]. This amendment, freed from the criteria of "convenience", appears to give the court broader discretion to change venue. It is yet to be seen how this "new" venue authority will be exercised by the courts, but it seems largely redundant in the face of the existing authority (ie. what court would order a change of venue that would be "inconvenient" for the
parties?).
As well, sometimes written contracts anticipate the problem and include terms setting out in which venue disputes should be resolved. When deciding where a case should be heard, a court may consider such an agreements by the parties, but the agreement is not binding on the decision [CJA s.114].
While normally applying to prevent tinkering with the monetary amount sought in a case, R6.02 (which prohibits splitting a case into two or more proceedings in order to bring the case within a court's jurisdiction) can apply to venue issues as well. For instance, a case involving shipping goods from one province to another should not be split into two cases - one in each province - just to keep the total matter within court jurisdiction. The court has a general principle of avoiding "multiplicity of proceedings" [CJA s.138] - even in "foreign" venues.
(c) Ontario v Extra-Provincial Jurisdiction
Initially, a party is brought under the jurisdiction of an Ontario court when they are properly served with the statement of claim in accordance with Ontario law, no matter where in the world that service occurs (see Ch.6 "Service of Documents"). If they (or the judge, for that matter) disagrees with the plaintiff's choice of venue, they may make a motion to transfer it to another local court (within Ontario). If the change involves a move outside of Ontario the court has no jurisdiction to "transfer" the lawsuit such that a "foreign" court is obliged to accept the case, so it will normally issue a "stay" (suspension without prejudice) of the proceeding - commenting that it should be re-commenced elsewhere.
If a party does not challenge venue reasonably promptly, and if the court itself raises no objections to it [see the new Reg 6.01(3) authority, above], the defendant will be bound by the resulting judgment - though in a case where a defendant lives entirely outside of Ontario and the litigation events bare little relation to Ontario, a court is likely to decide that the case should more properly be conducted in "another place".
(d) Local Ontario Court Venue
As per the general criteria for venue cited above, factors determining which local Ontario court (practically, which "court office") the case should be filed in and heard at trial involve consideration of where the cause of action occurred, where the defendant/s reside or conduct business, and where it is most "convenient" to hold the trial.
While local courts all have a "home" court office, they do not always have to "sit" (ie. physically hear cases) in one location - they can move around for the convenience of the citizens of the area.
Where the local court sits in more than one location, the case will be heard closest to "the place where the defendant or, if there are several defendants, where any one of them resides or carries on business."
For purposes of court administration, Ontario is divided into several large regions, listed here: Reg 186/90.
Within these regions are smaller "territorial divisions", each of which have local court offices. Their addresses are listed here: Local Court Offices. If you are uncertain of which court you belong on, call the nearest one and inquire.
7. Bankruptcy of Defendant
Once the defendant "goes bankrupt", serious jurisdictional issues arise immediately.
There are several ways for a defendant to commence or be forced into bankruptcy proceedings. Regardless of the method (assignment by themselves, creditor seeking appointment of a receiver, etc) once the proceedings have commenced there is normally an automatic "stay" (suspension) on any proceedings which attempt to enforce a claim "provable in bankruptcy" against them. Without exhaustively reviewing the law of bankruptcy this include the vast majority of claims that might proceed in Small Claims Court (there are exceptions for fraud, breach of fiduciary duty and others).
Usually however what this means is that once the bankruptcy proceedings have commenced, all monetary litigation and (post-judgment) collection procedures must be halted and re-directed to within the bankruptcy proceedings, through the bankruptcy trustee. Generally, once the debtor is "discharged" the debts (and alleged claims) are extinguished, although the Bankruptcy court which grants the discharge may allow some claims to persist.
The goal of bankruptcy is to ensure that an organized distribution of the debtors' assets is made between the various classes and rankings of creditor. Complex issues can arise in such proceedings as to who is a "preferred creditor", a "secured creditor", an "unsecured creditor", etc.
Once in bankruptcy proceedings a debtor should provide the trustee with a list of their creditors (and plaintiffs claiming against them), and the trustee will then notify the creditors of the bankruptcy filing. Where this is not done the creditor should contact the trustee directly as soon as possible. IMPORTANT: Failure of the debtor to list your claim does not automatically mean your claim survives bankruptcy, nor that it may be continued outside of the bankruptcy proceeding.
8. Subject-Matter Jurisdiction Delegated to Other Tribunals
(a) Overview
Before we start, some background is relevant. Bear with me.
As mentioned earlier, the old English courts of common law and Chancery were merged by English statutes of 1873 and 1875 to form a unified court which eventually evolved into Canada's present courts. This united court (our Superior Court of Ontario) has what was referred to as "plenary" (total) jurisdiction.
Since the early 20th century, these main courts have been in the process of 'shedding' various subject-matter jurisdictions. Most of this "shedding" has been done by legislation which sets up specific non-judge "tribunals" dealing with statutory schemes such as Worker's Compensation, labour relations (unions), social assistance, property and zoning, landlord and tenant, and other too numerous or obscure to mention. In order to make any functional sense out of this process, each Tribunal is given responsibility for a designated "subject-matter", and this new jurisdiction is normally exclusive - even barring the Superior Court from considering such cases at first instance (although that court may have a statutory appeal role and always has a judicial review role).
Not surprisingly, this jurisdictional "line-drawing" is not always as clear and uncontentious as one might hope. Like situations of geographical venue (discussed above) sometimes people end up being told (after considerable wasted effort) that they are "in the wrong place" (ie. wrong Court or Tribunal). To compound the injury, it can also sometimes happen that the new "place" to which they are sent disagrees and wants to send them back - leaving the would-be litigant exasperated and usually considerably lighter in the wallet. In such a situation the would-be litigant is faced with the further effort of continuing up the appeal process/es or taking the matter to the Superior Court by way of application for a declaration to sort the matter out. The proceedings multiply with no clear hope of resolution of even this preliminary issue in sight.
Cases involving termination of a sick or injured employee are notorious for invoking these problems, as they invite involvement of all or several of: the Ontario Human Rights Code system, Ontario Labour Relations, the Employment Standards Branch and the Courts for disability insurer and/or employer short/long-term disability coverage and wrongful dismissal, Employment Insurance, and the Workplace Safety Insurance Board. That a recently fired and ill person can be faced with the herculean task of advancing their case in this morass is an embarassment to us all.
This situation presents parties with a range of tactical and practical problems involving choices of remedies available, expense, multiplicity of proceedings, limitation periods, and speed of proceedings.
The problems this situation presents are numerous and there is no simple answer to them. Always the situation will involve a detailed analysis of the factual allegations, of the jurisdictional authority of the Tribunal, and of the procedural and practical availability of the Tribunal's process. Commencing proceedings in several forums - to be safe - is expensive and provides the other side with tactical oppourtunities to steer the case to what they think is a more favourable place - or just to tie the issue up for years by arguing jurisdictional issues back and forth. Indeed, filing the case in several venues in order to preserve your rights in them can be cited by the other side in seeking a stay. But if you don't file everywhere to reserve your rights in the (eventual) right place you might miss a limitation period!
One ray of hope for clarity in this mess had been provided by the case of Rasanen v Rosemount Instruments 17 OR (3d) 267 (Ont CA). In Rasanen the court applied the principle of "res judicata" (the issue has been adjudicated) or "issue estoppel" to dismiss a lawsuit for wrongful dismissal. It reasoned that an earlier ruling on the issue of wrongful termination of the employee by a referee applying employment standards legislation, being a legal standard almost identical to issue of common law wrongful termination in the lawsuit, was binding as between the parties on the wrongful dismissal issue. This principle, assuming situations where the legal issues are identical or near identical across the different tribunals and courts, strongly motivates the parties to locate their case primarily and initially at the Tribunal or court that is best suited for them tactically (ie. cheapest, fastest, most sympathetic, etc). Success in that place may then be argued as binding in the other proceeding/s, seeking other remedies.
Alas - and to the great disadvantage of dismissed employees throughout the province - this brief shining light of practical and affordable litigation has since been darkened. In Lacambra v Richtree Markets Inc. [2005] OJ #3863 (QL)(Div Ct) the Divisional court reversed a res judicata dismissal of a Small Claims case where a Board of Referees under the Employment Insurance Act (EI) had earlier found an employment termination justified on the basis of misconduct. The court relied on an earlier Court of Appeal case, Minott v O'Shanter Development 42 OR (3d) 321 (Ont CA, 1999) and held that the legal tests for termination under the EI legislation, on the one hand, and those under the Employment Standards Act (ESA) and at common law, on the other hand, were different. In Minott the court also cautioned about a too-simplistic view of Rasanen, preferring to focus on the fact-findings made in related cases rather than an equating of the various employment termination tests across the common law, the ESA and the EIA. Lacambra suggests that if the fact-findings made at the EI hearing had been articulate enough to allow application of the different legal tests, res judicata was still a possibility. The court in Minott further noted that even if res judicata was a possible outcome on the facts, that the court retained a discretion not to apply it in such cases if to do so would result in injustice.
The tragedy of split jurisdictions in this field cries out for legislative reform to unify such matters before one over-arching tribunal with broad jurisdiction (although past political efforts to do this have to date failed). Perhaps the problem could be solved if the varied statutes stopped promulgating their own, distinct definitions of "just cause" and deferred to the common law definiton.
(b) Examples
Below are some brief discussions and case reviews of SOME situations where jurisdictional venue conflict can arise. When such issues do arise clear answers are hard to come by and the below considerations, which are not always consistent in their conclusions, illustrate this. I CAUTION that these cases should be used only as a starting point for further research into both cases and statutory language. Particular attention should be paid to the Weber case discussed next, as it is often cited as authoritative on the general issue.- Ontario Labour Relations Board
Generally, all employment-related issues (except those areas under federal jurisdiction such as shipping and airlines) governed by a collective agreement (ie. unionized) fall under the jurisdiction of the Ontario Labour Relations Board (OLRB).
The "leading" case on this issue of jurisdictional venue conflict was decided in the OLRB context: Weber v Ontario Hydro [1995] 2 SCR 929. Weber was suspended by Ontario Hydro on an allegation, gained from surveillance, that he was abusing sickness benefits. When he sued for damages for the surveillance the Supreme Court of Canada held that the allegations fell within the exclusive jurisdiction of the OLRB procedures, and dismissed the civil action.
Then in Piko v Hudson's Bay 41 OR (3d) 729 (Ont Ca, 1998) an employee under a collective agreement was charged with fraud after a complaint by her employer. She sued for malicious prosecution and mental distress in civil court. The Court of Appeal allowed the action to proceed as the remedy sought by the employee was not available through the labour relations procedures.
Similarly, Guenette v Canada 60 OR (3d) 601 (Ont CA) involved a civil action by several employees of the federal government who were under a collective agreement. They alleged that after they "whistle-blew" about waste in their department they were subject of punitive actions by their employer. The Court of Appeal ultimately upheld their right to proceed in the civil court on a detailed examination of the nature of the complaint, the remedial power of the collective agreement process and the degree to which the collective agreement was meant to be remedially exclusive. The case is a strong illustration of the uncertainty faced by would-be litigants when deciding what remedial route to adopt.
Numerous other similar cases have been argued, with mixed results. The most common exception to the principle in Weber appears to be when the remedial route set out in the Tribunal is no longer available to the complainant, leaving the courts as the only available route to avoid a complete denial of justice.
- Landlord and Tenant Board
The Landlord and Tenant Board combines jurisdiction that used to be scattered over the (now) Superior Court (evictions and more), a series of rent review tribunals of various names, and elsewhere.
There is a separate Isthatlegal.ca Legal Guide that discusses these issues in greater length in it's chapter on civil remedies:
Residential Landlord and Tenant (Ontario) Law: Ch.16: Civil Remedies
In Ziegler v Sherkston Resorts Inc. (1996) 30 OR (3d) 375 (OCJGD) a group of tenants sued a landlord in civil court for return of allegedly illegal rents. The court held that jurisdiction for the recovery of illegal rents was exclusively with the rent review tribunal, whose governing legislation provided a "complete code" for such matters. The lawsuit as therefore dismissed.
The facts in the case of O'Shanter Development Corp v Separi (1996) 7 WDCP (2d) 267 (Ont Div Ct) were decided while evictions were still heard by the court under the old Part IV of the (then) Landlord and Tenant Act. In O'Shanter the landlord sued in Small Claims Court for rent arrears which arose due to a rent control order retroactively authorizing a rent increase. The court held that the tenant was aware of and agreed to be bound by a rent increase if it was authorized. As the tenant was no longer in possession of the premises at the time of action the Part IV L&T those procedures were no longer available, so the Divisional Court upheld the jurisdiction of the Small Claims court over the arrears issue - though making plain that jurisdiction to decide the legal rent level lay with the rent review tribunal.
In Crooks v Levine (2001) 148 OAC 44 (Ont Div Ct) a tenant gave notice of termination but the landlord prematurely entered residential premises and disposed of the tenant's property. The tenant sued in Small Claims court for rent rebate for the time he was denied use of the premises and damages for the lost property. It was held that even though the Rental Housing Tribunal has exclusive jurisdiction over the rent rebate issue, the primary cause of action was in damages. As it was inconvenient for the issues to be split between two venues, both were properly heard and decided in the court. [Note: In such cases it is rare - but highly refreshing - to hear court's refer to the convenience of the parties.]
In Walleye Trailer Park Ltd v Swire [2001] OJ #3227 (QL) (Div Ct) the Divisional Court allowed an appeal from a Small Claims action by a landlord who wanted her trailer park tenants to pay their share of property taxes for the units. The court found that the trailers were subject to the Tenant Protection Act and as such the dispute was within the sole jurisdiction of the Ontario Rental Housing Tribunal.
In Potter v Weltman [2003] OJ #3588 (QL) (Div Ct) the Divisional Court dismissed a Small Claims property damage action by a tenant on the grounds that it had already been decided by the Ontario Rental Housing Tribunal which had "exclusive jurisdiction" over the case.
- Copyright Violation
In Dolmage v Erskine 23 CPR (4th) 495 (Small Claims Ct, 2003) educational materials of a consultant were used in violation of his copyright. While claims for declaration and injunction with respect to the use of the material were declined on the basis of lack of remedial juridiction (see above), a damage claim was allowed.
- Human Rights Code (Ontario)
Stemming from the seminal case of Bhaduria v Seneca College (1981) 2 SCR 181, which held that no tort (ie. civil action) for human rights discrimination could be maintained as the Ontario Human Rights Code process had exclusive jurisdiction, numerous other cases have considered this issue since. As mentioned above, the importance of this issue has been exacerbated by the notorious inefficiency and slowness of the Code process, coupled with the draconian case-management practices of the Human Rights Commission which often terminates complaints without fair procedural justice.
The case of Alpaerts v Obront [1993] OJ #732 (QL) (OCJGD) was one case which experienced limited success in challenging the exclusive remedial jurisdiction of the Code process. The plaintiff alleged sexual harassment in her workplace to the point of constructive dismissal (ie. intolerable circumstances). She sued for wrongful dismissal, alleging in part human rights violations by the employer. The case was allowed to proceed, partly on the basis that the plaintiff had a cause of action separate from the Code violation. The court was concerned that if a Code complaint had been brought at the same time that the result may have been different, and a stay may have been merited.
The recent and important case of Tranchemontagne v Director (ODSP) should also be considered on this issue. See the Isthatlegal.ca ODSP Guide at Ch.12, s.8.
These issues are also discussed in the Isthatlegal.ca Human Rights (Ontario) Legal Guide at this link:
Human Rights Law (Ontario): Ch.17, s.6: "Remedies and Offences: The Civil Courts and the Code"
The law is not yet clear on this issue. There are numerous other cases with mixed results. As mentioned, the issue is of significant public importance given the abysmal state of human rights enforcement under Code procedures.
- Worker's Compensation (now Workplace Safety and Insurance)
In V & M Gratton Enterprises Ltd v Ontario (WCB) (1997) OR #1497 (QL)(Ont Small Claims Ct) an employer sued the (then) Workers' Compensation Board in Small Claims Court for recovery of allegedly improperly assessed WCB premiums and punitive damages. The court dismissed the case, finding that the WCB governing statute established processes for the dispute which were exclusive on the issue of the premium assessment. The punitive damage claim was dismissed as it failed to meet the standard of "patently unreasonable" which was required to allow the intervention of the court. (Note: this "standard" appears to have been drawn from the law of judicial review, and to the author's knowledge has not been elsewhere suggested as a justification for damage awards).
- Family Law Proceedings
In Lemoine v Lemoine (1990) 80 Nfld and PEI 339 (Nfld TD) the court held that Small Claims court had no jurisdiction to interpret and provide a remedy under a separation agreement regarding property separation as the family court had exclusive juridiction over the matter.
In Hutson v Versteeg [1995] WDFL 1675 (Ont Small Claims Ct) the court enforced, by way of damages, terms of a contract between spouses which purported to terminate spousal support. The court was clearly influenced by the fact that terms of an earlier child support order had expired before the time of the material facts of the case.
In Gal v Gal [2002] OJ #2937 (Div Ct) a father sued his daughter in Small Claims Court alleging that the daughter was abusing monies he paid on her behalf under a child support order which designated the monies to be used for education. The Divisional Court allowed a motion to dismiss the action in part because the Small Claims Court had no jurisdiction to vary the terms of a divorce order made in
Superior Court.
- Condominium Act
In Stockey v Peel Condominum Corp #174, 30 OR (3d) 464 (Ont Div Ct, 1996) a small claims court was held to have jurisdiction over a damage claim by a member for replacement of a defective garage door. While the Condominium Act provided a route to the General Division court for disputes over the performance of "duties imposed by this Act" and orders to perform said duties, the consideration before the court was one of determining responsibility for the expense between the parties. Further, it was reasoned, the Small Claims court was a branch of the (then) General Division court, and as such had jurisdiction over the issue provided the remedy was within its jurisdiction.
- Class Proceedings Act
Class proceedings were established in law by statute, not the common law. A "court" under the Class Proceedings Act (Ontario) does not include a Small Claims Court [s.1, CPA], and as such class proceedings may not be advanced there.
- Construction Liens
In Concord Trimming Inc v Valley Garden Homes Inc [1998] OJ #6350 the Divisional Court held that the Small Claims Court had jurisdiction to countenance a breach of trust claim under the Construction Lien Act.
In Brighton Heating & Air Conditioning v Savoia (Ont Div Ct, 2006) the trial judge held that - despite the jurisdictional prohibition on the Small Claims Court issuing declarations - that it could make a finding under a statute that a party was a trustee to other parties under the Construction Lien Act (CLA) [ss.8 and 13]. The appeal was granted on other grounds.
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