Small Claims Court

How do you sue a customer or client for an unpaid invoice in Ontario?

Last updated October 7, 2026.

To sue for an unpaid invoice in Ontario, you file a Plaintiff's Claim (Form 7A) in Small Claims Court for up to $50,000, attach the invoice and any contract, and ask for interest. You generally have two years from the day the invoice went unpaid. If the customer files no Defence within 20 days of being served, the clerk can sign default judgment for the amount owed.

A debt claim is often the most straightforward kind of Small Claims case, because the amount is fixed by the paperwork. Our page on Small Claims Court help for unpaid invoices and other claims explains how Carson Frankum, a licensed paralegal in Hamilton, handles these cases for businesses and individuals.

How do you sue for an unpaid invoice, step by step?

The Ontario government lists "goods or services sold and delivered that weren't paid for" first among the claims you can bring in Small Claims Court. The process below follows the Rules of the Small Claims Court and the government's own guide.

Check the deadline. Section 4 of the Limitations Act, 2002 bars a claim started more than two years after the claim was discovered. Under section 5(2), you are presumed to have known about the claim on the day the act or omission took place, which for an unpaid invoice is usually the day payment was due and not made.
Send a final demand. The Ontario government suggests trying to resolve the problem first, for example by sending a letter that explains what you think is owed. Keep a copy: it shows the amount and the date you asked.
Confirm who owes you. Sue the party you contracted with. The Ontario guide warns that a wrongly named defendant can leave you with a judgment you cannot enforce, and points to the Ontario Business Registry to find a company's exact legal name. The guide says a company's owner is named as well only where they have something to do with the case beyond being the owner, such as signing a personal guarantee; for a sole proprietorship or partnership, you may also name the owner or partners.
Prepare the Plaintiff's Claim. Rule 7.01(2) requires the claim to state, in plain language, what happened, the dates and the amount, and to attach every document the claim is based on (the invoice, quote, contract, purchase order or statement), or explain why a document is missing.
Ask for interest in the claim. The Ontario guide says interest must be requested on the claim form. Use the contract's rate if there is one, written as a yearly rate; otherwise ask for prejudgment interest under section 128 of the Courts of Justice Act.
File and pay the fee. The fee is $108 for most claimants, or $228 for a frequent claimant (O. Reg. 332/16). File in the right court office: where the work was done or the goods delivered, or where the customer lives or carries on business.
Serve the claim within six months. Rule 8.01(2) sets six months from the date the claim is issued, unless the court extends it.
Wait 20 days for a response. Under Rule 9.01, the customer has 20 days after service to file a Defence. Then one of three things happens, set out in the next section.

Unpaid invoice claim in Ontario Small Claims Court: key deadlines
Step	Time limit	Rule
Start the claim	Within two years of discovering the claim (usually the missed due date); never more than 15 years after the default	Limitations Act, 2002 ss. 4, 5 and 15
Serve the Plaintiff's Claim	Within six months after it is issued (court can extend)	Small Claims Court Rules r. 8.01(2)
Customer files a Defence	Within 20 days after being served	r. 9.01
Dispute a proposed payment plan in the Defence	Within 20 days after the Defence is served	r. 9.03(3)
Settlement conference	Within 90 days after the first Defence is filed	r. 13.01(3)
Offer to settle that can affect costs	At least seven days before trial	r. 14.07
Payment plan default notice	Judgment for the balance once 15 days pass after the notice of default is served	r. 9.03(2)

What happens after the customer is served?

Most invoice cases go one of three ways once the 20 days run out.

No Defence. You ask the clerk to note the customer in default (Form 9B). Because an invoice is a debt or liquidated demand, Rule 11.02 lets the clerk sign default judgment (Form 11B) for that amount, including interest if you claimed it. The fee is $94 for most claimants. Our guide to default judgment in Small Claims Court covers this route, including when a customer tries to set it aside.
A Defence admitting the debt with a payment plan. Under Rule 9.03, if you do not dispute the proposal within 20 days, the customer must pay as proposed as if it were a court order. If a payment is missed, you serve a notice of default, and 15 days later the clerk can sign judgment for the unpaid balance.
A Defence disputing the debt. The case goes to a settlement conference, required in every defended action by Rule 13.01. If it does not settle there, it can go to trial.

What changes the answer?

A written acknowledgment or a part payment

Section 13 of the Limitations Act, 2002 restarts the clock when a debtor acknowledges a claim for a liquidated sum, as if the default happened on the day of the acknowledgment. The acknowledgment must be in writing and signed (s. 13(10)) and made before the limitation period runs out (s. 13(9)). A part payment of the debt has the same effect (s. 13(11)). The 15-year ultimate limit in section 15 still applies. Our article on the limitation period for small claims explains the basics.

Business contracts can change the deadline

Section 22(5) of the Limitations Act lets a business agreement, meaning one where no party is a consumer, vary or exclude the basic two-year period. If your terms of business say something about deadlines, read them before you count on two years.

How interest was agreed

If your contract or invoice terms set an interest rate, you can claim it instead of the court rate: section 128(4)(g) of the Courts of Justice Act says court interest is not awarded where interest is payable by another right. But section 4 of the federal Interest Act limits interest to 5% a year where a written contract states only a monthly or daily rate without the equivalent yearly rate. With no agreed rate, section 128 gives prejudgment interest at the court rate from the date the claim arose, and section 129 gives postjudgment interest after judgment. Section 130 lets the court change either where it is just. See our guide to interest on debts and judgments for the arithmetic.

The size of the debt

Small Claims Court hears claims up to $50,000, not counting interest and costs. Several unpaid invoices under one contract may well be one cause of action, and Rule 6.02 forbids splitting a claim to fit under the limit. Read how much you can sue for if the total is close to $50,000.

A customer who complains about the work

If the customer says the goods were defective or the work was poor, expect a Defence and possibly a Defendant's Claim for their own losses. The amount then has to be proven at a settlement conference or trial rather than signed by the clerk. An offer to settle under Rule 14.07 can put pressure on a weak defence; see how offers to settle work.

A worked example

For example, imagine a Hamilton graphic designer named Alex who finishes a branding project for a local retailer and sends an invoice for $7,800, due in 30 days. The invoice says overdue accounts are charged "2% per month" but gives no yearly rate. The retailer pays nothing for months, then sends $1,000 and goes quiet.

The $1,000 part payment matters. Under section 13(11) of the Limitations Act, it has the same effect as a written acknowledgment, so Alex's two years now run from the date of that payment. Alex sends a final demand letter, then files a Plaintiff's Claim in Hamilton for $6,800, attaching the invoice, the signed quote and the email approving the final files.

For interest, the "2% per month" wording is a problem. Because the invoice does not state the equivalent yearly rate, section 4 of the Interest Act limits contract interest to 5% a year. Alex can ask for 5% a year under the contract. The retailer is served and files nothing within 20 days, so Alex requests default judgment and pays $94. If the retailer still does not pay, Alex can move to enforcement, starting with an examination hearing to learn about its bank accounts and assets. This example is hypothetical and is not based on any real client or result.

What mistakes do people make when suing for an invoice?

Suing the wrong name. Suing a trade name instead of the corporation that signed the contract can leave you with a judgment you cannot enforce. Search the Ontario Business Registry first.
Waiting out the clock. Months of "the cheque is in the mail" can quietly use up the two years. Only a written, signed acknowledgment or a part payment restarts it.
Claiming interest the law will not allow. A monthly rate with no yearly equivalent is capped at 5% a year by the Interest Act. Write rates as yearly figures.
Leaving out the paperwork. Rule 7.01(2) requires the documents your claim relies on to be attached, or an explanation of why they are missing.
Ignoring a payment proposal. If the Defence proposes a plan and you do nothing for 20 days, Rule 9.03(2) treats the plan as if it were a court order.
Not thinking about collection. The Ontario government warns that winning does not guarantee you will be paid. Find out early whether the customer has income, accounts or property.

What to do this week

Pull together the invoice, the quote or contract, delivery proof, and every message about payment.
Write down the due date, any payments received and their dates, and count two years from the latest one.
Check the customer's exact legal name and address on the Ontario Business Registry.
Send a dated final demand letter that states the amount and a deadline to pay.
Decide the interest rate you will claim: the contract rate written as a yearly rate, or the court rate.
Choose the court office using our guide to which courthouse to file in. For Hamilton cases, see the Hamilton Small Claims Court page.
Book a consultation if you want a licensed paralegal to prepare and file the claim.

Frequently asked questions

When does the two-year limitation start for an unpaid invoice?

Section 5 of the Limitations Act, 2002 starts the clock when you knew, or reasonably ought to have known, of the loss and who caused it. Section 5(2) presumes you knew on the day the act or omission happened, which for an invoice is usually the missed due date.

Does an email promising to pay restart the clock?

Section 13(10) requires an acknowledgment to be in writing and signed by the debtor or their agent, made before the period expires. Whether a particular email meets that standard depends on its content and how it was sent, so do not rely on it without advice. A part payment restarts the clock under section 13(11).

Can I charge interest if my invoice did not mention it?

Yes. Section 128 of the Courts of Justice Act entitles a person owed money to prejudgment interest at the court rate from the date the claim arose, as long as you ask for it in the claim.

Can I sue the owner of the business personally?

Only in some situations. The Ontario guide gives examples: a sole proprietor or partner, or a company owner who signed a personal guarantee. In its roofing example, the company that made the agreement is the defendant, not the person who did the work.

How long will a judgment last if I cannot collect right away?

Enforcement tools have their own time rules; for example, the Ontario guide says a writ of seizure and sale expires six years after it is issued unless renewed. Our guide on how long a Small Claims judgment lasts explains the rest.

Is a frequent claimant fee likely to apply to my business?

Only if you have already filed 10 or more claims in the same court office in that calendar year. Most small businesses pay the $108 rate.

Can a licensed paralegal sue on behalf of my company?

Yes. Law Society of Ontario By-Law 4 allows licensed paralegals to represent parties, including businesses, in Small Claims Court, and the Small Claims Court Rules define a representative to include a paralegal.

Sources

Need help with a Small Claims Court matter? Contact us today for a consultation.

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This page gives general information about Ontario law, not legal advice for your situation. Cheddar Paralegal PC is a paralegal firm licensed by the Law Society of Ontario; licensed paralegals can help only with matters the Law Society allows paralegals to handle.