Effective April 1, 2023, the Provincial Court of Alberta, commonly referred to as the “small claims court,” changed its name to the Alberta Court of Justice”. Chief Justice Derek Redman announced that the name change was made to reflect the growth and evolution of Alberta’s “front line”.
Going forward, judges of the former Provincial Court, will be referred to as Justices of the Alberta Court of Justice.
But, the name change was just the start!
The Justice Statutes Amendment Act (formerly Bill 5), 2022 (No.2), SA 2022, c.20, received royal assent on December 15, 2022, and amended six acts, including the Provincial Court (Civil Claims Limit) Amendment Act (the “Amendment Act”), for the purpose of simplifying the legal and court process, and improving security at the Legislature.
In terms of the Amendment Act, effective August 1, 2023, the civil claims limit will increase from $50,000 to $100,000. Notably, the civil claims limit was last increased in 2014 from $25,000 to $50,000.
In the long term, the court hopes the increased monetary limit will streamline the legal and court processes, reduce the pressures on the courts, enable the higher courts to focus on more complex issues, and provide Albertans with greater access to justice.
However, in the short term, there are likely to be some growing pains.
Generally, the small claims process is simplified, and less rigorous than that of the higher courts. This means there are fewer rules and deadlines invoked by the Justices. Although this is positive in terms of access to justice, it can have negative consequences on the parties, especially the defendants, that may be forced to respond to claims in an unrealistic timeframe, and/or before adequate document disclosure has occurred.
Further, it is worth noting that the legislation, which directly applies to the Alberta Court of Justice, mainly the Court of Justice Act, RSA 2000, c C-30.5, or the Court of Justice Civil Procedure Regulation, Alta Reg 176/2018, is silent on the rules/ processes pertaining to critical steps/ components of the legal process, mainly Questionings and disclosure of expert reports. This can create confusion as to the proper processes to be followed in these circumstances.
We see this issue becoming more prevalent with the increased monetary limit given claims will be worth more, and more likely warrant the increased litigation costs associated with going to Questioning, and exchanging expert reports, before trial.
Although the court hopes the increased claim limit will divert litigants from filing in the Court of King’s Bench, the option for litigants to pursue their claim in a higher court remains. Additionally, litigants will still be able to appeal decisions from the Alberta Court of Justice to a higher court, which likely will increase given the litigants greater financial stake. Therefore, it is possible that the higher-value “small claim” matters will still end up in the Court of King’s Bench, possibly nullifying the intended aim of the Amendment Act.
Ontario’s Small Claims Court gives us a glimpse into the changes that we may see in Alberta following the civil claims increase. After Ontario increased its small claim’s monetary limit from $25,000 to $35,000 in 2020, insurers saw an increase in the number of files being redirected towards the small claims court, and an increased number of self-represented litigants. On the one hand, Ontario’s increased limit had the desired effect of increasing access to justice. However, on the other hand, it resulted in more claims being handled by self-represented litigants who often lack the legal expertise to achieve a cost-effective and efficient resolution to their dispute.
Alberta’s $100,000 small claims limit is particularly noteworthy because the limit is substantially higher than any other small claims court in Canada. From British Columbia to Nova Scotia, the limits vary between $15,000 and $35,000, with the highest limits, besides Alberta, being in British Columbia and Ontario. Therefore, Alberta’s higher “small claim” monetary limit may serve as an opportunity for Alberta to pioneer a modern version of the small claims court.
With all that said, Section 9(1)(i) of the Court of Justice Act, supra, prescribes a maximum “small claims” limit of $200,000. Therefore, this latest increase may just be the beginning!
Written by Channing Brown with contribution from summer student, Xaviere Schneider.