2016 NSSM 27, 2016 NSSM 27

Case No. SCCH-15-445133 ORDER in the Small Claims Court of Nova Scotia Cite as: Preferred Credit Resources Ltd. v. Morrison, 2016 NSSM 27 B E T W E E N: PREFERRED CREDIT RESOURCES LIMITED Claimant -and- MICHAEL A. MORRISON Defendant DECISION 1 . This matter came before me on May 26, 2016. Mr. Peter Coulthard, Q.C. attended on behalf of the Claimant and Mr. Morrison attended on his own behalf. 2 . The action had originally been commenced in the Supreme Court of Nova Scotia, Hfx. No. 445133, involving the collection of an alleged outstanding credit card debt from MBNA Canada Bank in the total amount of $20,136.03.

This debt had been assigned to the Claimant, Prefered Credit Resources Limited, and they were now seeking collection. 3 . Mr. Morrison elected to transfer the matter down to the jurisdiction of the Small Claims Court on the premise that it was within the jurisdiction of the court in regards to the monetary amount. 4 . When I heard from Mr. Morrison in regards to this matter, he also indicated that he was unable to afford legal counsel and felt that he would be better able to respond to the claim on his own. He indicated that he had a number of arguments as it relates to the outstanding amount being claimed. 5 .

Upon the matter reaching my doorstep Mr. Coulthard, on behalf of the assignee of the alleged debt of Mr. Morrison’s, made a preliminary motion in regards to the jurisdiction of the Small Claims Court. Specifically, he noted that because the corporate assignee was not one of the original parties, the Small Claims Court would not have jurisdiction to hear this matter and in fact it would appear the Supreme Court administration incorrectly allowed the election. 6 . Mr.

Coulthard cited additional case law setting out how the court managed distinctions in regards to whether the corporate assignee was or was not one of the original parties. In this particular instance, Mr. Coulthard confirmed that Preferred Credit Resources Limited was never mentioned in the original contract between MBNA and Michael Morrison and this was a very straightforward “clean”

example of what the Small Claims Court legislation intended to exempt from the Small Claims Court jurisdiction. 7 . The specific

section of the Small Claims Court Act states as follows: Restriction on Corporation Partnership 5(1) To better effect the intent and purpose of this Act and to prevent the procedure provided by this Act to being used by a corporate person to collect a debt or a liquidated demand where there is no dispute, no partnership within the meaning of the Partnership and Business Names Registration Act and no corporation may succeed upon a claim pursuant to this Act in respect of a debt or liquidated demand unless the claimant is one of the original parties to the contract or tort upon which a claim is based or unless the claim is raised by way of set-off or counterclaim. 8 .

As Mr. Coulthard indicated at the hearing, the facts of this particular matter fall within the four corners of this section, except on one issue. There are many that would suggest that even where parties consent to jurisdiction , if the issue is not within the four corners of the Small Claims Court Act , there can be no jurisdiction nor power to issue an order or judgment. 9 . For those who would rigidly attorn to that concept, the delivery of appropriate justice would be lost should that perspective be successful.

While perhaps there are more clear circumstances where jurisdiction cannot be obtained simply by the consent of both parties, I believe this is not one of them. 10 . For starters, the substance of 5(1) speaks of an intention which appears, from my review and experience, to ensure that the services provided in the Small Claims Court are not consumed by parties that simply buy up other debts and attempt to realize on those debts more cheaply through the powers as set out under the Small Claims Court Act . 11 . Further, there is

Section 2, entitled “Purpose” which sets out the importance of providing an opportunity to adjudicate informally and inexpensively but in accordance with established principles of law and natural justice. 12 . If I understand Mr. Coulthard’s position vis-à-vis his client, they had no substantive issues in regards to being before the Small Claims Court however, they did not want to find themselves in a position where if appealed, they would have invested their time unwisely and then would be required to go back to the Supreme Court. 13 . More recently, there is the decision of Justice Suzanne H.

Hood in the matter of CIBC Life Insurance Company Limited v. Bete Hupman 2016 NSSC, 120 that involved the discretionary power of the adjudicator in the Small Claims Court. While the facts were significantly different in the noted case, Justice Hood was required to deal with a gap in the legislation and under those circumstances said as follows: There is, therefore, in my view, the ability for adjudicators to fill gaps in legislation to ensure there is natural justice in the proceedings before the Small Claims Court. This is a broad and purposive approach to the Small Claims Court Act . 14 .

I would quote her Ladyship’s reference in support of my ultimate determination consistent with the intent of the legislation to allow this matter to go forth but only on the basis that Mr. Morrison believed it to be the most just approach. This decision is based on the very unique facts if this case. ORDER

15 . On the basis of a motion made by the Claimant, Preferred Credit Resources Limited, I find that the Small Claims Court has jurisdiction to hear this matter and on that basis, I ask the parties to contact the Small Claims Court and set the matter down for a hearing. Dated this 7th day of July, 2016 J. W. Stephen Johnston Small Claims Court Adjudicator original – court file claimant/defendant