Small Business Sued in Manitoba Small Claims Court — What to Do

A customer says the service was botched. A supplier claims you stiffed them on an invoice. A former client wants a refund you refused. However it started, your Manitoba business is now named as a defendant in Small Claims Court, and the 20-day clock is already running.

Small business owners face a specific set of complications that individual defendants don't: who signs the form, who shows up at the hearing, and how to protect the business without bleeding money on legal fees for a claim under $20,000.

Who Responds for the Business

If your business is a sole proprietorship, you respond personally — you and the business are legally the same entity. File Form 76D in your own name (the way you were named on Form 76A) at the court registry.

For a corporation or partnership, the response must come from someone authorized to act on the company's behalf — typically a director or officer. The court may require documentation showing that the person appearing has authority to bind the corporation. Bring a copy of your articles of incorporation or a board resolution naming you as the company's representative for this proceeding.

The 20-day filing deadline and the $50 fee apply regardless of business structure.

Common Claim Types Against Small Businesses

Customer disputes. A customer alleges your product was defective, your service was incomplete, or the result didn't match what was promised. Your defence will focus on what was actually agreed, what was delivered, and any terms of service or warranty limitations.

Contract disputes. A vendor or subcontractor claims you owe for goods delivered or work completed. If the goods were defective or the work was substandard, you dispute the claim and potentially counterclaim for your losses.

Refund demands. A client wants money back for a service you provided. Whether you owe a refund depends on your refund policy, what was promised, and whether you delivered what was agreed.

Building Your Defence

The dispute-reasons section of Form 76D should address the specific factual claims on Form 76A. For a breach-of-contract claim, cover:

• What the contract or agreement actually said (attach the written agreement, invoice, or email chain)
• What your business delivered or performed
• Why the claimant's version of events is inaccurate or incomplete
• Any terms, warranties, or disclaimers that limit your liability

For an unpaid-invoice claim where you're the one being sued, explain why payment was withheld — defective goods, failure to complete the work, billing for services not rendered.

The Opportunity Cost Problem

A half-day at the courthouse means a half-day away from running your business. Manitoba's small claims system accounts for this somewhat — first appearances are often short (under an hour), and contested hearings are scheduled separately. Virtual hearings via Microsoft Teams are sometimes available, though they must be requested or assigned by the Court Officer.

Still, preparation time is real. Budget a few hours to organize your evidence and write your Form 76D, then a morning or afternoon for each court appearance.

When to Counterclaim

If the customer damaged your property, failed to pay for part of the work, or caused losses tied to the same transaction, use Form 76E instead of 76D. The counterclaim and defence are filed together for a single $50 fee.

A counterclaim also changes the dynamic: now the claimant has to defend themselves too, which sometimes opens the door to a settlement that neither side would have considered before.

Settle Early If It Makes Sense

Small claims court is designed for disputes under $20,000. For many small businesses, the cost of preparation time, lost productivity, and the stress of litigation exceeds the claim amount. If the claimant's demand is reasonable (or close to it), a negotiated settlement — documented in writing and filed as a consent order — can be cheaper than a hearing.

File your Form 76D first, though. Never negotiate with an unfiled defence. If talks break down after day 20, you're in default.

The Manitoba Small Claims Response Guide covers business-specific response strategies, including corporate representation rules and an evidence checklist for contract disputes.

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