First step: the demand letter

A demand letter is a formal notice demanding that the recipient perform a contractual obligation within a specified time frame. The letter gives the recipient a chance to perform the obligation without being taken to court. You can do it yourself with BidSettle; you don’t need to hire a lawyer.

A demand letter must include the following information:

  • the date;
  • the recipient’s contact information;
  • the legal phrase “Without Prejudice” to protect the sender in case of a future litigation;
  • the term “demand letter” clearly stated in the letter’s subject line to avoid any ambiguity for the recipient;
  • a summary of the dispute or matter;
  • a demand;
  • a deadline by which the recipient must act;
  • the sender’s contact information and signature.

How much time do I have to send a demand letter?

The legal deadline to sue someone, also called “the prescription”, is generally three years. This deadline is much shorter, however, if you intend to sue a municipality. The deadline may change according to the specific circumstances of your case so we recommend not to waste time and to send your demand letter as soon as possible. Important: the demand letter does not stop the prescription (legal deadline) from running.

The opposing party did not respond to your demand letter?

You will then have to submit your claim to the Small Claims Division clerk, normally located at the Courthouse. In order to make sure that you are at the right location, we recommend that you call your city or region’s Courthouse. Here is a link that will help you find the right judicial district. Normally, you must make your claim in the district where:

  • the event took place;
  • the defendant resides; or
  • the contract was concluded.

How to make a legal action?

One must submit a demand (or claim) to launch the process. Said demand must contain the reasons why you are suing, details of what you are asking for, witnesses who will be called, as well as any other document that will be submitted in evidence. These are required to confirm your version of the story. You have three choices to make this demand:

  • write it yourself;
  • fill out an online smartform, such as the one available on;
  • ask a lawyer to write it for you.

Practical tip 1: if the amount you are seeking if not very high, we recommend option 1 or 2. If you feel comfortable drafting it yourself, you will most definitely save costs by doing so. If not, it may be wise to consult a lawyer or be guided through the steps by an online solution.

Practical tip 2: if you are seeking slightly more than the Small Claims Court minimum, it may be wise to reduce your demand to  in order for your case to be admissible at the Small Claims Court. If not, you will have to proceed in a higher-level court where costs will most likely be greater and delays longer. Also, at a higher-level court, it will be difficult not to hire a lawyer to help you with your case, which will also lead to more costs.

Are there any fees to submit a claim?

Yes. The plaintiff must pay the fees associated with the demand. Court costs generally vary between $101 and $302.

What if I want to sue a company?

Double-check the company’s name <ahref=”http:”” en=”” default.aspx”=””>on the Corporations Canada website. It is important to identify the business correctly to avoid having to make corrections or even to start over your demand.</ahref=”http:>

Why make a legal action in Small Claims Court?

Easy answer: to obtain justice. A legal action clearly demonstrates the seriousness of your stance and in the majority of cases, it encourages the other party to settle out of court. If not, a judge will render a decision.

The party being sued has typically has 20 calendar days to pay the amount or to propose a mediation session (to obtain an out of court settlement). If not, the judge will set a date for the hearing.

If the opposing party has not contested the claim, it has 10 days to pay creditor (the party to whom the money is owed). When a judge has rendered a decision, the debtor (the party that is ordered to pay money) has to pay the creditor within 30 days of the judgment date.

If the debtor has not paid within the deadline, the creditor can take steps such as hiring a bailiff to enforce the judgment. Generally, the party that won the case has 10 years to see the judgment enforced.

This text explains the law in a general manner the law and does not constitute a legal opinion or legal advice. To find out the specific rules for your situation, write to us and we will refer you to a lawyer.