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I lost a Small Claims Court case, but can't afford to pay what I owe. What can I do?

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I lost a Small Claims Court case, but can't afford to pay what I owe. What can I do?
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Ministry of the Attorney General
CLEO (Community Legal Education Ontario / Éducation juridique communautaire Ontario)

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I lost a Small Claims Court case, but can't afford to pay what I owe. What can I do?
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Reviewed: 
February 23, 2017
Answer

If you were the defendant in a Small Claims Court case and you lost, you become the debtor. The person who sued you becomes the creditor.

If you lose your court case, the court may order you to pay money or return personal property. But the court does not collect the money from you.

Talk to the creditor

It's best to pay the money right away. But if you can't, try asking the creditor for more time. For example, you could ask the creditor to wait until you get a job.

If you don’t have very much money or property, you may offer to pay in instalments. This is when you pay what you owe in small amounts over a period of time.

What the creditor can do

If you don't pay what you owe right away, you will have to pay more. The creditor will get post-judgment interest on any part of the debt not paid back right away.

If you don't pay the creditor, they can take steps to collect the money from you. This is called enforcing the judgment.

For example, the creditor may:

  • Write to you and ask for the money.
  • Get an order from the court to take part of your wages or money from your bank account. This is called garnishment.
  • Get an order from the court to take or sell your personal property or land. This is called seizure.

The creditor may also ask for an examination hearing. At the examination hearing, you must explain your financial situation. You will be asked to show your assets, debts, and income. This will help the court and the creditors decide how to collect the money you owe.

If you disagree with a decision

If you lost your case in Small Claims Court and the claim is for more than $2,500, you can appeal the decision in Divisional Court. Usually, you must appeal within 30 days of the decision in Small Claims Court. If you think you may need more time, talk to a lawyer to find out if you're allowed more time.

It's a good idea to get legal help if you're planning to appeal your case. Appeals can take a long time and be very expensive. An appeal may even cost you more than paying back what you owe based on the Small Claims Court decision.

Even if you can prove the judge made a mistake, it may not always change the overall decision in your case.

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