Ruling Out Unlicensed Practice: Changing Small Claims Court Rules

Andrew Hyland

Photo: Andrew Hyland

Paralegal Andrew Hyland breaks down the coming changes to the Rules of the Small Claims Court.

In Law Society of Upper Canada v. Chiarelli, 2013 ONSC 1428 (CanLII), the Superior Court of Justice held in that a property manager may not act as a paid representative before the Landlord and Tenant Board. Combined with the Court’s prior ruling in Law Society of Upper Canada v. Augier, 2013 ONSC 451 (CanLII) both the Court and the Law Society indicated a clear intent toward cracking down on unlicensed practice before Ontario’s Courts and Administrative Tribunals.

It appears that Queen’s Park is listening.

Beginning Jan. 1, 2014, the Rules of the Small Claims Court will be amended to include a new Rule 1.08:

1.08  For greater certainty, nothing in these rules permits or authorizes the court to permit a person to act as a representative if that person is not authorized to do so under the Law Society Act.

This new rule is likely to have a significant impact on the way business is conducted before the Court; it is important to understand exactly what it means.

The new rule does not require all parties to be represented; nor does it restrict the Court’s discretion to allow or remove persons appearing before it. In particular, s. 26 of the Courts of Justice Act remains un-amended, as follows:

26.  A party may be represented in a proceeding in the Small Claims Court by a person authorized under the Law Society Act to represent the party, but the court may exclude from a hearing anyone, other than a person licensed under the Law Society Act, appearing on behalf of the party if it finds that such person is not competent properly to represent the party, or does not understand and comply at the hearing with the duties and responsibilities of an advocate.

Self-represented persons (including, presumably, corporations via directors and employees) will continue to be allowed to speak before the Court. So will persons exempted under the Law Society Act, including but not limited to friends and family members — provided they meet the requirements set out in By-law 4, including the requirement not to be paid. This is made further explicit in changes to rule 19.04, which restricts representation fees to lawyers, paralegals, and students-at-law only. The Court also retains its powers to exclude unlicensed persons exempted under the Law Society Act if they fail to meet the standards of competency and responsibility under s. 26.

Unlicensed Practice Costs Dearly

The primary target of the new rule, then, is unlicensed practice. Paralegals who practice in Small Claims Court have frequently encountered unlicensed practitioners, ranging from persons who are completely unaware of the Court’s rules, to those who are deliberately ignorant of them, to those who abuse the exemptions in the Law Society Act while appearing before the Court.

Too often, what should be relatively un-convoluted matters turn vexatious, resulting in significant delays, increased costs, and prejudice to both parties, as the Court deals with matters that might have been resolved much sooner if all parties were properly represented. Instead, proceedings can become akin to something out of a U.S. daytime court show. Put another way, while Small Claims Court is a people’s court, it is not The People’s Court.

As paralegals, we have a professional obligation to report unlicensed practice; however, the act of doing so did not mean we would cease to encounter the subjects of our complaints before the Court. Rule 1.08 represents a significant step towards solving this problem, by making explicit what is implied in s. 26 of the Courts of Justice Act.

While this new rule will not completely eliminate the problem of unlicensed practice, it should give paralegals hope and cause to rest a bit easier at the end of the day.


The changes coming in next year are to ONTARIO REGULATION 230/13, under the Courts of Justice Act. These amend O. Reg. 258/98, the Rules of the Small Claims Court

Andrew Hyland operates Veritas Legal Services in Oshawa. Reach Andrew at:

      andrew.hyland@vlsparalegal.com
      www.vlsparalegal.com

Law Times reports that Joseph Kary, counsel for Chiarelli, told the Court of Appeal in December that his client meets the definition of a landlord under Ontario legislation.

Chiarelli is wholly responsible for managing the property, Kary said, arguing his client should have the rights normally granted to landlords.

2 comments

  1. Baruch, if I were a betting man, I would suggest it is going in precisely that direction and could come to encompass all tribunals and boards; in fact it could be argued that counsel could already make that motion in light of the recent decisions. It would not be a big stretch at this point – the game board has definitely tilted.

  2. This is all very interesting. I see a pattern slowly starting to form. The Small Claims rules get changed to permit only licensees to function as paid representatives, and property managers are no longer permitted to be paid representatives in front of the LTB, in favour of licensees. I am wondering if this will eventually lead to other Tribunals heading in the same direction. For example, could labour negotiators lose their rights to function as paid representatives in front of the Employment Tribunal, in favour of licensees?

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