Ontario Small Claims Court Proposal to Pay

When a Payment Proposal Makes Sense

Not every Defence is a full dispute. Sometimes you know you owe the money — or most of it — but can't pay a lump sum right now. Ontario's Small Claims Court rules let you admit the claim (fully or partially) and propose a payment schedule, all within the same Form 9A Defence.

This isn't giving up. It's a structured way to manage what you owe while keeping the process orderly and avoiding a default judgment.

How It Works Under Rule 9.03

When you file Form 9A, you check the box indicating you admit the claim (in full or in part) and fill in your proposed terms of payment. Your proposal can take several forms:

• Monthly instalments — for example, $200/month until the balance is paid
• Weekly or biweekly payments — matching your pay schedule
• A deferred lump sum — the full amount by a specific future date

Be realistic. The court isn't looking for what you wish you could pay — it needs a number grounded in what you actually earn and spend.

What Happens After You File

Once the plaintiff is served with your Defence containing a payment proposal, they have 20 days to file and serve a Request to Clerk (Form 9B) if they dispute your proposal and want a Terms of Payment Hearing. Two paths from here:

They accept (or do not request a hearing). If the plaintiff does not dispute your proposal within 20 days, you must pay according to it as if it were a court order. If you admit the full claim and no hearing is requested, no further court step is required unless there is a payment default.

They dispute it. If the plaintiff files and serves Form 9B within 20 days, the court schedules a Terms of Payment Hearing before a referee or other person appointed by the court. At the hearing, the court examines your financial information to determine what you can actually afford. The court may make a payment order that differs from what you proposed.

Preparing for a Terms of Payment Hearing

If the plaintiff rejects your proposal, you'll need to demonstrate your financial situation. Bring:

• Proof of income — recent pay stubs, tax returns, or bank statements showing deposits
• Monthly expense records — rent/mortgage, utilities, groceries, childcare, insurance, loan payments
• Financial Information Form (Form 20I) — if you are an individual, the court will send you a blank form. Complete it and serve it on the plaintiff before the hearing; it cannot be filed with the court.

The hearing is typically brief. The judge weighs your necessary expenses against your income to determine a sustainable payment amount. You don't need a lawyer or paralegal for this, though you can have one.

Partial Admission

You can admit part of the claim and dispute the rest. For example, if the plaintiff says you owe $8,000 but you believe the correct amount is $5,000, you can:

1. Admit $5,000 and propose payment terms for that amount
2. Dispute the remaining $3,000 with reasons

The admitted portion follows the payment proposal track. The disputed portion goes through the normal settlement conference and (if needed) trial process.

Key Advantages of a Payment Proposal

• Avoids default judgment — filing Form 9A with a proposal, even admitting the full amount, means you've responded and the plaintiff can't note you in default
• Court-ordered terms — if a Terms of Payment Hearing sets the schedule, follow the payment order made by the court
• Shows good faith — judges notice when defendants engage with the process rather than ignoring it, which can matter if costs are assessed

Risks to Know

If the plaintiff has not disputed your proposal and you fail to make a payment, the plaintiff may serve a Notice of Default of Payment (Form 20L). If you do not arrange payment within 15 days after service, the plaintiff may file an Affidavit of Default of Payment (Form 20M), and the clerk will sign judgment for the unpaid balance of the amount you admitted. If the court set terms at a hearing and you miss a payment, the plaintiff may file an affidavit of default; unless the order says otherwise, the clerk will sign judgment for the unpaid balance.

Propose only what you can sustain. Overcommitting to look good at the hearing backfires when you miss the third payment.

The Ontario Small Claims Court Defence Guide includes a financial-means worksheet and the exact Form 9A payment-proposal language for both full and partial admissions.

See more Ontario guides →