Can a judge penalize me with extra costs in Small Claims Court if my claim is frivolous?

Yes. The Rules of the Small Claims Court give a judge discretion to award costs against a party who has acted in bad faith, brought a claim without a reasonable basis, or conducted proceedings in a manner that caused unnecessary delay or expense. This power exists to deter parties from using the court system to harass others or to pursue claims that have no genuine merit.

A judge can also order costs against a self-represented party whose claim or defence is found to be frivolous or made in bad faith. The cap on representation fees does not fully limit the court's ability to sanction misconduct — if a party's conduct has been particularly egregious, the judge can award costs that go beyond the standard ceiling.

In practice, Small Claims Court judges use enhanced cost awards as a last resort and are more likely to comment on the weakness of a position than to impose financial penalties on first-time litigants who had a genuine (if misguided) belief in their claim. However, repeat offenders or parties who clearly abuse the process face real financial exposure.

If you are facing a claim you believe is brought in bad faith, document the pattern of conduct carefully and raise it at the Settlement Conference or trial. A frank conversation with a paralegal before responding can help you decide how to address it.