The other day I had a conversation with a lawyer who was threatening to sue my client as well as two others. The claim was for $24,000. He was proposing to start the action in the Supreme Court of Nova Scotia.
I asked him why he didn't start the action in the Small Claims Court (where, in Nova Scotia, the jurisdiction includes claims of up to $25,000). He said that he thought that under the new civil procedure rules in Nova Scotia (which came into effect January 1, 2009) he could get his discoveries done in two days and then to trial "reasonably quickly." He thought that the ability to recover some of his client's legal costs (which can't be recovered in Small Claims Court) justified starting the action in the Supreme Court.
But consider the cost of doing it this way.
Two days of discovery and disclosure would cost the client something in the range of $5,000 if not more. Add to that the delay of getting the matter to discovery (at least six months) coupled with the delay of getting it to trial (probably another six months) and then the actual cost of trial itself (again, at least $5,000) coupled with the risk of loss means that the client would be "spending" a year and at least $10,000 to pursue the matter worth $24,000 in the Supreme Court.
Contrast that with a claim in the Small Claims Court. The matter could be heard in one or two evenings (so the client wouldn't loss a day's work) within a month or two of the claim being issued. The client would be paying only for the lawyer's time in court, as opposed to days of shuffling paper at a discovery in a Supreme Court action. He or she would get a decision soon after the hearing, if not on the evening of the hearing. And they would not have to fear paying a portion of the legal costs of the other side if they lost, as is the case in the Supreme Court.
Which aproach do you think the client would chose if asked?
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