As A Creditor, Should I Transfer My Claim To Small Claims Court?

On October 1, 2025, the monetary limit for the Small Claims Court was increased from $35,000 to $50,000, and the minimum appealable amount from $3,500 to $5,000.¹ This doesn’t mean that all proceedings that began in the Superior Court of Justice for amounts between $35,000 and $50,000 were automatically transferred to Small Claims Court as of October 1, 2025. If you want to move your claim to Small Claims Court, it may be done in the following ways.²

1) By transferring the claim (for more information, see our blog article here); or

2) By discontinuing the current claim and recommencing it (if your action falls within the prescribed limitation period).

In deciding to transfer your action to the Small Claims Court or remain in the Superior Court of Justice, it’s critical to assess the complexity of the matter and the potential costs. The practical question is often not only “Can we fit within $50,000?”, but rather, “is the amount we give up, if any, less than the cost and risk savings from using Small Claims Court?”

The Superior Court of Justice is generally ideal for claims that involve multiple parties, layered legal issues, or require the full range of civil procedure tools. These tools, including documentary discovery, examinations for discovery, and interlocutory motions, exist to ensure a just and fair administration of the law.

Small Claims Court, by contrast, aims to provide an accessible, streamlined, and proportionate forum for resolving disputes with smaller monetary amounts at stake, with simplified pleadings, mandatory settlement conferences, and less formal trial procedures.

Legal Costs

Legal costs exist at every stage of an action. In assessing potential costs, consider the following questions:

• Do I require legal counsel?
• What are the fees involved in participating in each court?
• What are the costs of enforcing the judgment?

For a $45,000 claim, the cost savings of remaining in or transferring to Small Claims Court can be substantial. Fewer procedural steps mean fewer billable hours, and the streamlined timeline reduces the carrying cost of the litigation. Where collectability is uncertain, keeping litigation expenses low also protects creditors from throwing good money after bad.

It’s also worth noting that creditors who remain in Superior Court for claims within the $50,000 to $200,000 range may benefit from the simplified procedure, which offers a streamlined and less costly process for resolving certain civil cases in the Superior Court.³ Simplified procedure eliminates some of the heavier procedural steps (e.g., oral examinations for discovery, in most cases) and can reduce the time and expense of a Superior Court proceeding, even if it does not match the simplicity of Small Claims Court. For claims just above $50,000 where the creditor is not prepared to abandon the excess, proceeding by way of simplified procedure, where applicable, may be a practical middle ground.

As an example, see below for some fees you can expect to incur in a claim⁴:

* A claimant who has filed 10+ claims in the same SCC office in a calendar year

In the Small Claims Court, the statutory limit on the award of costs is generally limited to 15% of the amount claimed, excluding any reasons in the interests of justice.⁵ Compare this to the 40-60% that courts generally award in Superior Court (“partial indemnity”), or 1.5 times partial indemnity costs (“substantial indemnity”), which is rare but possible.⁶

Additionally, as a creditor, enforcement is another factor to consider. Even if the action succeeds, there are numerous costs involved to search, obtain, or enforce a writ or lien against the debtor, which can add unexpected fees.⁷

Venue and Territorial Connection

Another consideration is where the Small Claims Court action would be heard. Under Rule 6.01 of the Rules of the Small Claims Court, an action must be commenced in the territorial division that has some connection to the region, whether by the cause of action or the defendant’s place of residence or business.⁸

Recently, some court locations have been requiring claimants to demonstrate a genuine connection to the region before accepting filings. The Milton courthouse, which serves the Halton region, is one example: we have seen claimants asked to justify why their matter has a rational connection to that jurisdiction.

Creditors should confirm, before filing or transferring, that they can establish a defensible basis for the chosen location. Practical examples of how to demonstrate a territorial connection include:

• The debtor’s registered head office or residential address falls within the territorial division.
• The contract giving rise to the debt was signed or executed within the territorial division.
• The goods or services underlying the claim were delivered or performed within the territorial division.
• Payment was to be made within the territorial division.
• The underlying agreement contains a forum selection clause designating the territorial division.

If none of these connections exist, the creditor risks a challenge to venue that could result in the claim being transferred to another court location or, at minimum, delay and additional cost to re-file the claim.

Don’t Try to Game the System

Choosing the wrong forum by accident is one thing, but choosing the wrong forum to manipulate the system is another. Courts take a dim view of forum manipulation. If a claimant improperly brings an action in the Small Claims Court and succeeds, the court could deny recovery of their legal costs.⁹ The Superior Court also has the power to order costs against a plaintiff if they improperly commenced the action in the Superior Court instead of in the Small Claims Court.¹⁰ In other words, inflating or deflating a claim to stay in either court can carry real cost consequences.

This blog was co-authored by summer law student Isabelle Park

Footnotes

1 Rules of Civil Procedure, RRO 1990, Reg 194, s 57.01, as amended by O Reg 42/25.

2 Importantly, the $50,000 limit does not include interest and costs, meaning a creditor whose principal claim falls at or below $50,000 can still proceed in Small Claims Court even where accrued interest or anticipated costs would push the total recovery higher.

3 Rules of Civil Procedure, RSO 1990, Reg 194, Rule 76.

4 Administration of Justice Act, RSO 1990, c A6, O Reg 332/16.

5 Courts of Justice Act, RSO 1990, c C43, Section 29.

6 Rules of Civil Procedure, RSO 1990, Reg 194, Rule 1.03 (1).

7 “Small claims court fees – Fees payable to the sheriff” (24 October 2025) online: https://www.ontario.ca/page/fees-small-claims-court#:~:text=Fees%20payable%20to%20the%20sheriff.

8 Courts of Justice Act, RSO 1990, c C43, O Reg 258/98, Rule 6.01.

9 Rules of Civil Procedure, RSO 1990, Reg 194, Rule 57.05(1).

10 Rules of Civil Procedure, RSO 1990, Reg 194, Rule 57.05(5).