Unjust Enrichment – Jurisdiction – Small
The Court of Appeal for Ontario held that the Small Claims Court
has equitable jurisdiction for the payment of money and the return
of personal property.
The appellants and respondents are individuals who lived in
Ontario and owned units in the same condominium complex in British
Columbia. A dispute arose between the owners and the management of
the condominium complex. The respondents John Hodgins and Ann
Dorans ("Hodgins and Dorans") hired legal counsel in
British Columbia and obtained an order in the Supreme Court of
British Columbia appointing an administrator to manage the
condominium council and to prepare an expert report on the
financial management of the complex.
Hodgins and Dorans brought an action in the Ontario Small Claims
Court ("OSCC") seeking payment of a portion of their
legal expenses by the appellants Chander Grover and Tabassum Grover
("Grovers"). Hodgins and Dorans based their claim in (1)
contract or, in the alternative, (2) the unjust enrichment of the
Grovers. The deputy judge dismissed the contract claim but upheld
the unjust enrichment claim. The deputy judge found that there was
a benefit to the Grovers, a corresponding deprivation to Hodgins
and Dorans, and no juristic reason for the enrichment. The Grovers
lost at the first stage of appeal before a single judge of the
The question for the Court of Appeal was whether the OSCC has
jurisdiction to grant equitable remedies. Two sections in the
Courts of Justice Act, R.S.O. 1990, c. C.43 appear to
conflict: section 23(1)(a) states that the OSCC "has
jurisdiction in any action for the payment of
money . . . ", while section 96(3) states
that only "the Court of Appeal and Superior Court of Justice,
exclusive of the Small Claims Court, may grant equitable relief,
unless otherwise provided".
Justice Epstein, writing for the Court, reviewed the legislative
history of these sections and the history of the OSCC. Of
importance was section 96(1) of the Courts of Justice Act
which states that courts "shall administer concurrently all
rules of equity and the common law". Justice Epstein held that
this section extends to the OSCC, which therefore has the power to
administer the rules of equity. Because it would not make sense for
the legislature to extend this power to the OSCC but then to
preclude the OSCC from granting equitable relief, the OSCC can
grant equitable relief. However, section 96(3) limits such
equitable relief to the payment of money within the OSCC's
jurisdictional boundary and to the return of personal property.
Although Justice Epstein held that the deputy judge had
jurisdiction to make the unjust enrichment award, she found he
erred in doing so on the facts before him. There was no benefit to
the Grovers and no deprivation to Hodgins and Dorans. The court
allowed the appeal.
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