British Columbia is in the process of rolling out a new dispute resolution mechanism for strata disputes and matters falling within the Provincial Court Small Claims jurisdiction ($25,000.00). The object of the Civil Resolution Tribunal (the “CRT”) is admirable. The aim is to provide convenient and cheaper access to justice through an online portal that is user friendly and purged of byzantine legal processes.
Litigants deal with each other directly, aided by a case manager. The hope is to find resolution through monitored negotiation, failing which the parties submit to an administrative adjudicator. But the flip side of this new tribunal is that parties can be denied access to legal representation through the CRT’s process. Further, the fact that many defendants, who have paid for liability policies which would otherwise provide a defence, may be denied that defence through this process. Little consideration seems to have been paid to the fact that many of the resolutions sought at the CRT will be funded by those liability policies.
By sometime in 2017, the CRT will be the mandatory dispute resolution tribunal for small claims under $10,000 and all strata property disputes. The tribunal will also hear, on a voluntary basis, non-strata claims between $10,000 and $25,000. Once the CRT opens in 2016, it will be accessible 24 hours a day, seven days a week, from a computer or mobile device with an internet connection. The dispute resolution process will be conducted almost entirely over the internet. Participants are encouraged to navigate the online dispute resolution tools on their own or with the help of a lawyer, trusted friend or family member. Dedicated case managers or facilitators will work with both parties to the dispute to help them reach a negotiated settlement. If a settlement cannot be reached, participants may apply to the tribunal for a binding decision.
Final decisions and orders of the tribunal are enforceable in the BC Provincial and Supreme Courts. Strata decisions are final, subject to a limited right to appeal. Concurrent with the plan to make small claims of $10,000 or less mandatory, participants unhappy with the results will be able to appeal to the Provincial Court, as of right, and that appeal will be a trial de novo, as though the CRT process never happened.
While participants are permitted to use a lawyer during the negotiation and case management phases of the online dispute resolution process, lawyers are not permitted to appear during hearings in front of the tribunal except as representative of a minor or an individual with impaired mental capacity. While participants may apply to the tribunal to bring representation to an in-person hearing, they are not permitted representation as a matter of right. The CRT has the right to deny participants legal representation during the in-person adjudicative phase pursuant to s. 66(2)(h)(ii) of the Civil Resolution Tribunal Act (CRTA). The CRT justifies this on the basis that, according to the CRT, “most people …will be more satisfied and have more enduring resolutions if they participate directly and actively in the process.”
1 While the mandate of the CRT is not explicitly set out in sections of the CRTA now in force or on the Civil Resolution Tribunal’s website,2 it can be found in section 2 of Bill 44 – 2012 Civil Resolution Tribunal Act;3 however, this section is not currently in force.4 According to Bill 44, the CRT’s mandate is to provide accessible, speedy, economical, informal and flexible dispute resolution services using an electronic format. Resolutions are to be made within the principles of law and fairness and with an eye to maintaining any relationships between the parties that will continue after the tribunal proceeding is concluded.
The CRT appears to be a response to the increasing cost of litigation, the growing number of self-represented litigants appearing before the courts and the perceived need to create more fairness in the system. The Chair of the CRT, Shannon Salter, has noted that court processes work well enough for lawyers, judges and staff, but are often over-whelming for the litigants themselves.5 The CRT is designed to provide early, expeditious access to dispute resolution with case managers and through direct negotiations between the parties themselves.
Presumably, the CRT sees representation by lawyers as counterproductive to the adjudicative phase of its dispute resolution process. They may have a point. Lawyers are well-versed in rules of procedure and know that those rules, when followed, serve to place parties on a level- playing field. The rules result in fair hearings. Self-represented litigants often see it differently. Lawyers, who have mastered procedure and seek to have the rules followed, can be seen as relying on “technicalities” by lay litigants. The self-represented feel disadvantaged and believe that the system is unfair as a result.
Justice must not only be done, but must be seen to be done. Confidence in the legal system is a cornerstone of civil society. But in trying to level the playing field for self-represented litigants, drafters of the legislation have removed lawyers from the equation, possibly putting some members of the public at increased risk. The mandatory nature of the CRT, which was prescribed in response to the “low uptake” when participation was voluntary, as originally conceived6, means that parties can be exposed to significant claims without the benefit of full legal representation.
Further, by making the CRT mandatory for small claims for less than $10,000 and by allowing for an automatic appeal process that is essentially a “do over” in Provincial Court, proponents of the CRT may have simply created another level of process, costing time and money, only to have the litigants ultimately wind up in court when unsuccessful participants press the reset button.
Worse still is the prospect of participants to strata disputes finding themselves in the CRT process without legal representation and with no right of appeal regardless of how significant the issues.
With respect, removing lawyers from the process does not make the process fairer. It can have the opposite effect. All litigants are not created equal with respect to resources and sophistication. Sometimes the only thing standing between a debtor and a collector engaged in unfair practices is a lawyer. Nobody should argue that taking away the debtor’s lawyer is going improve things for the debtor.
This has consequences for the insurance industry and insureds. Individuals and businesses carrying liability policies (almost every homeowner and business), pursuant to which they are entitled to a defence, may find themselves statutorily barred from using that defence. Insured defendants may be advised to wave at the CRT and wait for the right to proceed through Small Claims. Parties to a strata dispute will not have that option.
The insurance industry funds a large proportion of judgments and settlements. The CRT may inadvertently find its participants cut off from the pockets that fund the resolutions the CRT seeks. Insurers may find themselves being asked to fund negotiated settlements in which they had no right to participate. A logical but unintended outcome might be $10,000 deductibles or higher premiums. This places a significant burden on insureds. The consequence for the public and the CRT would be uninsured and unfunded judgments. This is an undesirable outcome from any rational policy perspective.
Thus, despite the best of intentions, the CRT may simply further erode the public’s perception of the legal system. However, none of this is set in stone. The legal profession has been criticized for its “deeply entrenched resistance to change.”7 It is true that the profession is conservative and does not accept change as quickly as it might. But when the change is the removal of the right to legal representation in the face of serious consequences, resistance may be justified.
Civil Resolution Tribunal Web Site: https://www.civilresolutionbc.ca/