Third Party Procedure

Prepared by Glenn Gallins
Revised March 2008
Funded by the PLE Program of the Legal Services Society


 

WHAT THIS FACTSHEET IS ABOUT

This factsheet describes what Third Party Procedure is about. It tells:

  1. How a Defendant can add a Third party to a lawsuit;
  2. What a Third party should do when served with a Third Party Notice; and
  3. What options are open to a Claimant when informed that a Third Party has been added.

When a lawsuit is begun in Small Claims Court, the Claimant files a Notice of Claim at the Small Claims Court Registry. The Notice of Claim contains a statement which describes the Claimant's claim against the Defendant. The Defendant is then served with the Notice of Claim. After receiving the Notice of Claim, the Defendant must file a Reply to be able to defend the lawsuit.

 

EXAMPLES OF WHEN A THIRD PARTY MIGHT BE ADDED TO A LAWSUIT

At this point the Defendant should also think about whether anyone else should be added to the lawsuit. The Defendant might want another person added to the lawsuit for two reasons. First, the person may be required by law to repay the Defendant for any money the Defendant is forced to pay the Claimant. The legal requirement to pay back the Defendant for any money that the Defendant must pay to the Claimant is called an "indemnity." For example, suppose the Defendant worked for a company. The company may have agreed to be responsible for any claims made for faulty work done by the Defendant. Suppose the Defendant is sued for faulty work. Suppose the company then refuses to pay for the claim. In this situation the Defendant may wish to make the employer a "third party" to the lawsuit. That way if the person suing wins the lawsuit, the Defendant may get an order against the company for the amount owed to the person suing.

 

There is a second reason for a Defendant making another person a party to a lawsuit. When a Defendant believes she has a claim against a third person which is in some way related to the subject matter of the lawsuit which was begun by the Claimant, she may wish to add that third person to the lawsuit. For example, suppose the Defendant is being sued by the person who bought her house. The buyer is claiming that the Defendant told him the insulation in the ceiling was eight inches thick. In fact it was only four inches thick. The Defendant had the insulation work done by a contractor who contracted to put in eight inches of insulation. The Defendant may add the insulation contractor as a third party to the lawsuit because the subject matter of the lawsuit is the same. That is, the subject matter relates to the thickness of the insulation. In the lawsuit, the Claimant is seeking money from the Defendant for misrepresentation or breach of contract. The Defendant will also seek money from the insulation contractor for a breach of contract.

 

 

WHAT HAPPENS IF THE LAWSUIT IS SUCCESSFUL AGAINST THE THIRD PARTY

If after trial a Claimant is successful against a Defendant and the Defendant is successful against a third person (called a "Third Party") who has been added to the lawsuit, then:

  1. The Claimant can recover the amount ordered against the Defendant; and
  2. The Defendant can recover from the Third Party up to the amount awarded to the Claimant against the Defendant.

Thus the Court will make two separate orders. One will be for the Claimant against the Defendant and one will be for the Defendant against the Third Party.

 

 

PROCEDURES FOR ADDING A THIRD PARTY

There are two different procedures to add a third party. One procedure applies if a Settlement Conference has not yet been held. The second procedure must be followed if a Settlement Conference has already been held.

 

 

BEFORE A SETTLEMENT CONFERENCE

If no Settlement Conference has yet been held to add a person to a lawsuit as a third party you must:

  1. Prepare and file at the Small Claims Court Registry a Reply to the Notice of Claim. Information about preparing a Reply can be found in Factsheet 8.
  2. Prepare and file a Third Party Notice.
  3. Serve on the person being added to the lawsuit a copy of the Notice of Claim which started the lawsuit, your Reply to the Notice of Claim, the Third Party Notice, a blank Reply form and a copy of a Notice of Settlement Conference or Notice of Trial if one has been already issued.
  4. File a Certificate of Service. The Certificate of Service must be filed within 30 days of the filing of the Third Party Notice. If the Third Party Notice is not served and the Certificate of Service is not filed within 30 days, the Third Party Notice may be invalid. In that case a new Third Party Notice will have to be issued and served or an application will have to be made to a Judge to extend the time for serving or filing the Certificate of Service.

 

 

AFTER A SETTLEMENT CONFERENCE

If a Settlement Conference has already been held, to add a third party you must:

  1. Prepare and file at the Small Claims Court Registry an Application to a Judge for an Order permitting a claim to be made against the third party.
  2. Serve the Application on the Claimant.
  3. Appear before a Judge to explain why the Order should be made.
  4. If you are successful, prepare an Order.
  5. Prepare and file a Third Party Notice.
  6. Serve the Third Party Notice, Notice of Claim, your Reply, a blank Reply form and Notice of Trial if one has been issued.
  7. File a Certificate of Service.

 

PREPARING A THIRD PARTY NOTICE

Click here to view a sample Notice of Claim, Reply, and Third Party Notice

. The samples are provided so you can see how they relate to one another. First, the Claimant sets out the claim in the Notice of Claim. The Defendant defends the claim by filing a Reply. Then the Defendant files a Notice of Third Party to add to the lawsuit someone he thinks should pay the claim.

 

To prepare a Third Party Notice you will need a blank Third Party Notice form.

Click here to obtain a copy of the form

. The form has instructions on it which must be followed. You will see the form requires 6 types of information:

  1. The registry file number and location.
  2. The name, address, phone number of the Third Party (the person being added to the lawsuit).
  3. The name, address and phone number of the Defendant.
  4. The name, address and phone number of the Claimant.
  5. A description of what happened to lead to the lawsuit.
  6. A statement of how much money is being claimed.

Only two parts of the form may cause you any problem. They are the "what happened" part and the "how much" part.

WHAT HAPPENED

In the "WHAT HAPPENED" part you should write why the Third Party should be responsible for the Claimant's claim. The general types of reasons were listed

above

.

 

The "WHAT HAPPENED" part of the form should be written in clear, simple English. Each important point can be numbered and set out in a separate sentence. The goal is to write enough facts so that a Judge will understand why the Third Party should pay the claim.

 

HOW MUCH

In the "HOW MUCH" section of the Third Party Notice form fill in the amount you are claiming. If you think the Third Party is responsible for the entire amount of the Claimant's claim write down that amount. If the Third Party is responsible for only part, indicate just the amount the Third Party should be required to pay.

 

 

FILE AND SERVE THE THIRD PARTY NOTICE

If no Settlement Conference has been held yet, you must now file the Third Party Notice at the Small Claims Court Registry. Then serve it (

and the other documents required

) on the Third Party. Remember that a

Certificate of Service

must be filed at the Small Claims Court Registry within 30 days of the filing of a Third Party Notice. For more information about a Third Party Notice and a sample of a completed Certificate of Service see

Factsheet 6

which is called "Serving Documents."

 

 

AFTER A SETTLEMENT CONFERENCE

If you want to add a Third Party after the Settlement Conference you will have to make an Application to a Judge. To do so you must fill in an Application to a Judge form.

 

PREPARE AN APPLICATION TO A JUDGE

Click here to obtain a blank Application to a Judge form.
Click here to view a sample of a completed Application to a Judge form

.

 

If you refer to that form, you will see that there are only two parts of the form which may be difficult to fill in. The first is the part of the form that asks you for details of the order you are asking for. The second is the part of the form that asks you for the facts upon which your application is based.

 

DETAILS OF THE ORDER YOU ARE ASKING FOR

The words you want to describe the order you want are as follows:

"The Court grant an order permitting a claim to be made against (insert the name of the person, company, society, etc.)."

FACTS UPON WHICH THE APPLICATION IS BASED

After the words, "The facts on which the application is based are as follows:" you should write the facts that will show the that proposed Third Party should be responsible for the Claimant's claim. This section of the form can be completed just like the

"what happened" section of the Third Party Notice

.

 

FILE THE APPLICATION

After you have filled in the Application to a Judge form, you should make three photocopies of it. The form should then be filed at the Small Claims Court Registry. At the time you file the form the clerk will tell you the date and time of the hearing.

 

SERVE THE APPLICATION

You must then serve the Application on the Defendant. You can serve the Application form in three ways. You can:

  1. Leave a copy with the Defendant.
  2. Mail it by ordinary mail to the Defendant's address.
  3. Mail it by registered mail or certified mail.

If the Application is mailed, it is presumed by law to have been delivered fourteen days after being sent, unless there is evidence of earlier delivery.

 

HOW LONG BEFORE THE HEARING

The Defendant must receive the Application seven days before the hearing. Thus, the soonest the hearing could take place would be eight days after the Application was filed. To have the hearing so soon would require the Clerk to have set the court date eight days after the Application was filed. The Defendant would also have to be handed a copy of the Application on the same day it was filed.

 

If the Application is going to be mailed to the Defendant, the date of hearing should be set not less than 22 days after the date of filing. This would allow 14 days for the delivery of the application by mail plus 7 days the Defendant is allowed to have between the time of being served and the time of the hearing.

 

 

APPEAR BEFORE A JUDGE

Appear in Court on the day and at the time required on the Application to a Judge form.

 

Be sure to arrive on time. Your opportunity to speak to the Judge will usually occur early in the Court session. When you arrive you should take a seat in the Courtroom. After Court is called to order, the Judge or Court Clerk will usually read through the whole list of the day's cases. When your case is called, stand up and inform the Judge you are present. After the Judge reads through the list once, the Judge will begin to go through the list a second time. When the Judge calls out the name of your case the second time, you should go to the front of the Courtroom. Stand when you speak to the Judge and address the Judge as

"Your Honour."

You should say the following:

 

"Your Honour, I am making an application to permit a claim to be made against (name of person) by adding (name of person) to this lawsuit as a Third Party."

 

You should then give the Judge a summary of the facts relating to your case. The Judge may ask you to be sworn so that the facts are given under oath.

 

The Judge may also ask you questions. If the Claimant is present in Court, the Claimant may also ask you questions.

 

After you have spoken (and given evidence under oath if requested by the Judge), the Claimant, if present, will be given an opportunity to tell the Judge what his or her position is.

 

 

THE DECISION

If the Judge decides it is appropriate, an Order will be granted permitting you to add the Third Party to the lawsuit.

 

 

PREPARE AN ORDER

If the Judge decides to grant an Order in your favour, then the Order must be put in writing.

 

The bottom of the Application to a Judge form is used for this purpose. Sometimes the Judge (or Clerk) will fill in the form. Other times, the Judge will order you to fill in the form. In both cases, the Judge must sign the Order in the box containing the words "By the Court." The Order must then be filed at the Court Registry.

 

 

THE NEXT STEPS

If you succeed in obtaining an Order, you must then prepare a Third Party Notice, file it, serve it (together with the other required documents) and file a Certificate of Service.

 


 

WHAT TO DO IF YOU ARE ADDED TO A LAWSUIT AS A THIRD PARTY

If you are made a party to a lawsuit by being served with a Third Party Notice, you have a number of choices about what to do. These choices are:

  1. You could do nothing. In that case the Defendant will be able to obtain a Default Order against you. Although the Defendant will have to make an Application to a Judge for an Order, the Defendant will win his case against you and obtain an Order without the need to go to a full trial.
  2. You could defend against the claim described in the Third Party Notice. To defend against the Defendant's claim you must file a Reply. For information about how to prepare a Reply see Factsheet 8 which is called "What To Do If You Are Sued in Small Claims Court."
  3. You could make a counterclaim against the Defendant by filing at the Small Claims Court Registry a counterclaim using the appropriate section of the Reply form (again, see Factsheet 8).
  4. You could defend against the claim made by the Claimant against the Defendant. To defend against the Claimant's claim you must file a second Reply. If you do not file a second Reply, you may not be able to participate in the part of the trial which deals with the suit by the Claimant against the Defendant. The Reply could include new defenses or could merely repeat defenses which the Defendant has set out in his Reply.
  5. You could add another person to the lawsuit. This is sometimes called "Fourth Party proceedings." The procedures which have been described above for adding a third party are the same procedures which are used for adding a fourth party.

 

WHAT SHOULD A CLAIMANT DO WHEN SERVED WITH A THIRD PARTY NOTICE

A Claimant will receive a copy of the Third Party Notice from the Small Claims Court Registrar. The Claimant could do nothing and just proceed to Settlement Conference or Trial. However, it may be better for a Claimant to add the Third Party as a Defendant by amending the Notice of Claim. The procedure for amending the Notice of Claim is set out in

Factsheet 2

which is called "Starting A Lawsuit."

 

There are two good reasons for adding the Third Party as a Defendant. First, it allows the Claimant to conduct the trial against the Third Party rather than leaving it just to the Defendant (who might do a poor job).

 

Second, if successful at trial the Claimant can collect money directly from the Third Party, rather than only being able to collect from the Defendant, who then may or may not collect from the Third Party. Put another way, if the Defendant was unable to pay, the Claimant might be out of luck even if the Third Party could pay.

 


 

 

THE NEXT STEP

If a Settlement Conference has not yet been held, then the Registry will schedule one. See

Factsheet 12

for more information on Settlement Conferences.

 

If a Settlement Conference already took place before the Third Party was added, then a new Settlement Conference will be scheduled unless a Judge orders otherwise.

 

After the Settlement Conference will be a Trial. For more information about preparing for a trial see

Factsheet 13

.

 



Page Last edited: 2008-10-15 16:05

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