The customer charged back
after you did the work

By Jonathan Kleiman, Barrister & Solicitor · Published August 2026

The version I hear most often goes like this. A client approved the scope in writing. You did the work. You delivered it, they used it, and nobody complained for a month. Then your processor emails: the cardholder has disputed the charge, the funds are being held, and you have a short window to respond with documents. Somewhere in the notice is a reason code saying the service was not provided.

The instinct at that point is to treat it as theft and to start drafting something furious. That instinct is understandable and it is usually the wrong first move, because it skips the question that decides everything that follows: does this customer have a legal right to their money back, or not? Sometimes they plainly do not, and you have a collectible debt. Sometimes they do, and the chargeback is the cheap version of a problem that would otherwise have arrived as a claim.

A chargeback is not the final word on whether a customer owes your business money — but it is not nothing either. Before you re-invoice, threaten legal action, or write the loss off, you need two things: an honest read on whether the customer has a valid basis for a refund, and the documents that prove your agreement and your performance. This guide works through both, in the order the first week actually demands.

Is a chargeback the same as losing a legal claim?

No. A chargeback is a payment dispute administered through the card issuer, network, acquirer and processor under private contractual rules — not a court deciding whether the customer owes you money. The two processes ask different questions, apply different standards, and can land in opposite places on the same facts.

That cuts both ways, and it is worth being fair about the second direction. Losing a chargeback does not extinguish a debt: the network decided a payment question under its own rules, and a court applying Ontario contract law is not bound by that. But winning a chargeback does not immunise you either. A customer who loses a card dispute can still sue, and if they had a real cancellation right under the Act, your win on the payment channel has not resolved it.

What a chargeback does decide is money and operational consequence, immediately. Funds come out. Fees may attach. Enough of them and your processor starts looking at your account, your reserve, or your pricing. Those consequences are real and they arrive on the processor's timetable, not yours, which is why the response deadline in your case notice is the first thing to find and the first thing to diarise.

A note on those deadlines, because this is where a lot of online advice goes wrong: network and processor timelines vary by network, reason code, region and merchant agreement. Do not rely on a number you read in an article, including this one. Open the notice you were sent and work to the date it gives you.

The practical framing I would suggest: treat the chargeback as a deadline-driven evidence problem first, and a legal question second. The evidence you gather for the processor is almost exactly the evidence a court would want later, so the work is not wasted either way — and it is far easier to collect in week one than in month eight.

What should you do in the first 48 hours?

Find the deadline, then assemble the file — because the records that prove your case degrade fastest in exactly the period when you are angriest and least inclined to be methodical.

Work through this as a checklist. Most of it you will already have; the gaps you find are themselves diagnostic, because a gap here is usually the same gap that would sink a claim.

1. 01
   The processor's notice itself

   Case number, reason code, the documents requested, and the response deadline. Diarise the deadline the day you read it, not the day before it expires.

2. 02
   The agreement, as it existed then

   Signed proposal, contract, statement of work, terms of service or checkout record — and the version in force on the transaction date, not the version on your website today.

3. 03
   The payment record

   Invoice, payment authorization, receipt, and any deposit or milestone payments that preceded the disputed one.

4. 04
   Scope, deliverables and dates

   What you agreed to supply, by when, and on what terms for cancellation, rescheduling, revisions and refunds.

5. 05
   Approvals and change orders

   Emails, texts, client-portal comments, signed change orders — anything showing the customer directed or accepted a change to scope, price or timing.

6. 06
   Proof that you performed

   Timestamps, delivered files, photographs, shipping and delivery confirmation, access logs, meeting records, time entries, an acceptance email. For services, this is the single hardest thing to reconstruct later and the single most valuable thing to have.

7. 07
   The complaint trail

   Every message in which the customer complained, asked for a refund, or tried to cancel — including the ones that are unflattering to you. You need to know what a decision-maker will eventually see.

8. 08
   What you offered to do about it

   Revisions, replacement, rescheduling, repair, a partial refund. Evidence of a reasonable attempted remedy helps you in every forum this can end up in.

9. 09
   A written note of the cancellation question

   If the buyer was a consumer: did they give notice of cancellation, when, and by what method? Did you refund, and within what period? Those two dates drive the statutory analysis below.

10. 10
    The commercial arithmetic

    Amount in dispute, your realistic cost of recovery, and whether the customer could pay a judgment. Write the number down now, before sunk-cost reasoning sets in.

Keep this file even if you decide to walk away. If the customer later sues you — which happens more often than merchants expect, particularly where a consumer believes they were entitled to a refund all along — this is your defence, and by then most of it is unrecoverable.

Which of the four chargeback situations are you actually in?

Nearly every chargeback after completed work falls into one of four patterns, and they call for genuinely different responses — the mistake is running the same aggressive playbook against all of them.

Read the reason code and the customer's actual words, not your interpretation of their motives. What the customer is claiming determines which questions decide the outcome.

Scroll the table sideways to see all three columns →

Two of these — the unauthorised transaction and the non-delivery claim — are situations where a merchant who fights hard and loses ends up worse off than one who investigates and resolves. The fourth is where the collection question genuinely lives. The third is the one this article spends the most time on, because it is the one where Ontario law does work that most businesses do not expect.

When does the Consumer Protection Act let a customer reverse a credit card charge?

Section 99 of the Consumer Protection Act, 2002 gives a consumer a statutory route to ask their credit card issuer to cancel or reverse a charge — but only where the consumer has already cancelled or demanded a refund under the Act and the supplier has failed to refund within the required period. It is a different animal from the network chargeback, and the difference matters to you.

Section 99(1) lets a consumer who charged a payment to a credit card account request the issuer to "cancel or reverse the credit card charge and any associated interest or other charges." Section 99(2) lists the payments this covers: a payment in respect of a consumer agreement cancelled under the Act or a related agreement; a payment received in contravention of the Act; a payment of a fee or amount charged in contravention of the Act; and a payment collected for unsolicited goods or services for which no payment is required under section 13.

Then comes the provision that does the real work. Section 99(3) provides that a consumer may make the request "if the consumer has cancelled a consumer agreement or demanded a refund in accordance with this Act, and the supplier has not refunded all of the payment within the required period."

The timing is prescribed rather than left at large, and the numbers are worth knowing because they are frequently misreported:

• You have 15 days to refund. Section 96(1) of the Act requires a supplier whose consumer agreement has been cancelled to refund any payment made under the agreement or any related agreement. Section 79(1) of O. Reg. 17/05 sets the period: within 15 days after the day the consumer gives notice of cancellation under section 92 of the Act.
• The consumer then has 60 days to go to the issuer. Under section 85(1) of the regulation, the request must be given to the credit card issuer within 60 days after the end of the period within which you were required to refund.
• The request has a prescribed form. Section 85(2) requires it to be signed and to set out specified details — the consumer's name, account number and card expiry, your name, the date of the agreement if known, each charge with its amount, posting date and a description of the transaction, and, where the charge relates to a cancelled agreement, the date of cancellation and the method used to give you notice of it.
• The issuer must acknowledge within 30 days of the request being given, under section 85(3).
• And must then act by the second statement of account. Section 85(4) provides that the period runs from when the request is given and ends on the date of the second statement of account the issuer delivers to the consumer after the request. Under section 99(5)(b) the issuer must, within that period, either reverse the charge or send the consumer written reasons why it considers the consumer not entitled to cancel or to demand a refund.

That last item is a correction worth making, because "two complete billing cycles or 90 days, whichever comes first" circulates widely in Canadian merchant guidance. Ontario's regulation measures it by the second statement of account, and section 99(6) gives the consumer a right of action against the issuer if it does not comply.

One more point that changes your risk profile: notice under section 92 can be given in almost any form. Section 92(2) says the notice may be expressed in any way as long as it indicates the intention to seek the remedy, section 92(3) allows it to be oral or in writing and given by any means unless the regulations require otherwise, and section 92(4) deems written notice given when sent. In practice that means a customer's angry email saying they are cancelling can be effective statutory notice, and your 15-day refund clock may have started on a message somebody filed as a complaint. Whether they ultimately had the right to cancel is a separate question — but the clock does not wait for you to work that out.

Which cancellation rights actually trigger that route?

The statutory cancellation rights that most often catch service businesses are the future performance agreement rules, the internet agreement rules, and the late-delivery provision — and all three turn on paperwork rather than on whether your work was any good.

This is the uncomfortable part of the analysis for a business that performed well. These rights do not ask whether the customer got value. They ask whether you complied.

Future performance agreements

Section 20 defines a future performance agreement as a consumer agreement "in respect of which delivery, performance or payment in full is not made when the parties enter the agreement" — the ordinary shape of a deposit-now, deliver-later services engagement, and a far wider net than the name suggests. Sections 22 to 26 apply where the consumer's total potential payment obligation, excluding the cost of borrowing, exceeds a prescribed amount, which section 23.1 of O. Reg. 17/05 sets at $50 for agreements that are not gift card agreements. That threshold catches essentially every real engagement.

Section 22 requires every future performance agreement to be in writing, to be delivered to the consumer, and to be made in accordance with the prescribed requirements. Section 23 is the consequence: a consumer may cancel a future performance agreement within one year after the date of entering into it if they did not receive a copy of the agreement meeting the section 22 requirements. A year. Not seven days. If your engagement runs on a verbal understanding and an invoice, this is the provision to be worried about — and it is worth reading alongside our guide on service agreements for Ontario small businesses, which covers what a compliant written agreement should contain.

Internet agreements

Section 20 defines an internet agreement as a consumer agreement "formed by text-based internet communications" — narrower than "anything sold online," but it captures the ordinary web checkout and email-confirmed order. Where the customer bought that way and the total potential payment obligation exceeds $50 (section 37 of the Act; section 31 of the regulation), three obligations apply:

• Disclose before the customer commits. Section 38(1) requires prescribed information to be disclosed before the consumer enters into the agreement. Section 32 of the regulation lists it — your name and any business name, telephone number and business address and other contact methods, a fair and accurate description of the goods and services including technical requirements, an itemised price list including taxes and shipping, other charges, the total payable, terms and methods of payment, delivery and performance dates, delivery details, who will perform the services and where, any additional rights or obligations you accept regarding cancellations, returns, exchanges and refunds, trade-in details, currency if not Canadian, and any other restrictions, limitations and conditions.
• Give an express opportunity to accept, decline and correct errors. Section 38(2) requires that opportunity immediately before entering the agreement, and section 38(3) requires the disclosure to be accessible, and available in a way ensuring the consumer has accessed it and can retain and print it.
• Deliver a written copy within 15 days. Section 39(1) of the Act with section 33(1) of the regulation. Section 33(2) requires the copy to include the section 32 information plus the consumer's name and the date the agreement was entered into.

The cancellation rights in section 40 follow from those. Under section 40(1) a consumer may cancel at any time from the date of the agreement until seven days after receiving a copy if you did not make the required disclosure or did not provide the express accept-or-decline and error-correction opportunity. Under section 40(2) a consumer may cancel within 30 days of entering the agreement if you did not comply with section 39. A checkout flow that never emails a proper copy of the agreement is quietly creating 30-day cancellation rights on every consumer order.

Late delivery or late commencement

Section 26 lets a consumer cancel a future performance agreement at any time before delivery or commencement if you do not deliver within 30 days after the specified delivery date, or do not begin performance within 30 days after the specified commencement date — in each case as varied by an amended date the consumer agreed to in writing. If no date was specified, section 26(2) runs the 30 days from the date the agreement was entered into.

Two subsections cut the other way and are worth knowing, because they are rarely mentioned. Under section 26(3), if the consumer agrees to accept delivery or authorise commencement after the period has expired, they may no longer cancel under that section — a late start that the customer accepted is not a cancellation right they can revive months later. And under section 26(4) you are considered to have delivered or commenced where delivery or commencement was attempted but refused by the consumer, or could not proceed because nobody was available on a day for which you gave reasonable notice. If your file shows attempted delivery and a customer who would not take it, say so and prove it.

Does a "no refunds" policy protect you?

Against another business, often yes. Against a consumer exercising a statutory right, no — section 7(1) of the Act provides that the substantive and procedural rights it gives apply despite any agreement or waiver to the contrary.

A refund policy still does useful work. It governs the discretionary refunds you offer as goodwill, it sets expectations, and in a genuine business-to-business sale it can be close to decisive. What it cannot do is remove a cancellation right the legislature conferred. A "no refunds, all sales final" banner does not shorten the one-year window in section 23 or the 30-day window in section 40(2).

Section 93(1) goes further in a way that surprises people: a consumer agreement is not binding on the consumer unless the agreement is made in accordance with the Act and the regulations. Section 93(2) provides the counterweight — a court may order that a consumer is bound by all or part of an agreement even if it was not made in compliance, where it determines that it would be inequitable in the circumstances for the consumer not to be bound. That is a genuine argument and it is sometimes the argument that saves a merchant. It is not a compliance strategy.

Two related limits, if your terms contain the usual clauses. Section 7(2) makes a term requiring arbitration invalid insofar as it prevents a consumer from exercising a right to commence an action in the Superior Court of Justice given under the Act, and section 8(1) preserves a consumer's ability to bring or join a class proceeding. Section 7(3) does permit the parties to agree on another dispute-resolution process after a dispute has arisen, so a genuine post-dispute settlement route remains open. The same commercial-versus-consumer fork is worked through in more detail in our guide on whether an as-is clause is really as-is in Ontario.

Can you re-invoice, re-charge, or sue?

Re-invoicing is usually fine and is often the right first step. Re-charging the card without fresh authorization is not. Suing is possible, but only after you have honestly tested whether the customer has a contractual, statutory or factual answer.

Take them in order. An invoice is a demand, not self-help — sending one with the contract, the delivery proof and a clear statement of the amount is a reasonable step and it starts a collection process properly. Forcing a second charge through after a reversal is different. Commercially it is the kind of conduct that attracts processor scrutiny and can put your merchant account at risk. Legally, if the payment was one the customer was entitled to have refunded, taking it again does not fix your position: section 98(1) lets a consumer demand a refund of an amount charged or received in contravention of the Act within one year of paying it, and section 99(2) makes such a payment its own trigger for a further reversal.

On suing, the questions worth answering before you spend anything are these, and they are the questions I would work through with a client in a first meeting:

• Is there a clear, enforceable agreement, and can you produce the version in force at the time? If the arrangement was verbal, our guide on whether a verbal contract is enforceable in Ontario is the place to start.
• Did you deliver, and did the customer accept it — expressly or by conduct — and can you prove both with something better than your own recollection?
• If a consumer: did they get the required disclosure and a compliant copy of the agreement? Answer this before, not after, you take a position on their rights.
• Is there a real quality, misrepresentation or non-performance issue that a court would take seriously, separate from the customer's tone?
• Is the defendant collectible, and is a partial refund cheaper than the fight? A judgment against someone with nothing is an expensive piece of paper — see how to enforce a Small Claims judgment for what collection actually involves. Price the settlement honestly rather than treating it as capitulation.

If the answers point toward a claim, a demand letter comes first in most cases. It costs little, it frequently resolves the matter, and it creates a record of a reasonable attempt to settle that helps you later. You can draft a starting point with the Ontario demand letter generator.

Mind the clock while you are deciding. A claim for breach of contract or the price of goods and services is subject to the ordinary two-year basic limitation period, running from discovery — see how long you have to sue for breach of contract in Ontario, or run your own dates through the Ontario limitation period calculator.

Is Small Claims Court the right forum, and what will it demand of you?

For most chargeback disputes, yes — and for a claim within its limits it is not optional. The Small Claims Court hears claims up to $50,000 exclusive of interest and costs, and a claim within its jurisdiction cannot be started in the Superior Court except with leave.

The Small Claims Court is continued as a branch of the Superior Court of Justice under section 22(1) of the Courts of Justice Act. Section 23(1)(a) gives it jurisdiction in any action for the payment of money where the amount claimed does not exceed the prescribed amount exclusive of interest and costs, and section 1(1) of O. Reg. 626/00 sets that amount at $50,000. Section 23(1.1) then provides that an action within the Small Claims Court's jurisdiction shall not be commenced in the Superior Court of Justice except with leave — so for a $9,000 claim, the choice of the bigger court is not yours to make. Section 23(1.2) carves out counterclaims, crossclaims and third party claims where the main action was already commenced in the Superior Court.

The choice runs the other way too, and that matters if your loss is larger than the limit. A business owed more than $50,000 is not obliged to litigate in the Superior Court: it can abandon the excess and proceed in Small Claims for $50,000. The waiver is permanent — you give up the difference for good, not merely for that proceeding — but on a $57,000 claim the saving in cost, delay and procedural complexity often outweighs the amount given up. It is a real option to price, not a consolation prize; our guide on Small Claims Court versus the Superior Court works through the comparison.

That structure also answers a question consumers sometimes raise. Section 100(1) of the Consumer Protection Act, 2002 says a consumer with a right of action under the Act may commence it in the Superior Court of Justice. Because the Small Claims Court is a branch of that court, a consumer claim within the monetary limit is heard there in the ordinary way.

What the court will want from you is proof of both liability and amount. A chargeback notice is not evidence that the customer owes you money; it is evidence that a dispute happened. The documents in your first-48-hours file are what does the work — and the rules give you a specific route to get them in.

Rule 18.02(1) of the Rules of the Small Claims Court provides that a document or written statement or an audio or visual record served at least 30 days before the trial date on all parties who were served with the notice of trial "shall be received in evidence, unless the trial judge orders otherwise." Rule 18.02(2) applies that to the signed written statement of any witness — including an expert's written report, to the extent it relates to facts and opinions the witness could testify to in person — and to any other document, expressly including financial records, receipts, bills, documentary evidence of loss of income or property damage, and repair estimates.

The requirement people miss sits in rule 18.02(3): a party serving such a statement or document must append or include the name, telephone number and address for service of the witness or author, and a summary of qualifications where the evidence is expert evidence. Serve the documents without those details and you have not done what the rule requires. Our guide on what evidence wins in Small Claims Court goes through the practical side of assembling it, and how to sue in Small Claims Court covers the procedure end to end.

Before filing, price the decision. The Small Claims Court calculator will estimate the fees and interest, and the settle versus court calculator models the risk-weighted comparison between a negotiated resolution and pursuing the claim. For a chargeback of a few thousand dollars, that comparison quite often favours settling — and it is better to know that at the start than after the settlement conference.

How do you prevent the next chargeback?

Most chargeback exposure is created at the point of sale, months before the dispute — in what you disclosed, what you documented, and whether the customer ever received a copy of the agreement.

These are operational changes rather than legal theory, and they are cheap compared with one contested claim:

• Put the scope in writing, with specific deliverables and dates. "Website redesign" is not a scope. It is an invitation to a quality dispute you cannot win on paper.
• Deliver a copy of the agreement, and keep proof that you did. For consumer work this is not just good practice — sections 22 and 39 make it the difference between a binding engagement and a cancellation right that survives for 30 days or a year.
• Require written approval for changes to scope, price and deadlines. Section 26 only counts an amended delivery date the consumer agreed to in writing.
• Bill in milestones on longer engagements. It caps the exposure of any single reversal and it creates a natural record of acceptance along the way.
• State cancellation, refund, rescheduling and revision terms plainly — and make sure they do not purport to remove statutory rights, because section 7(1) means they cannot.
• Get a short written acceptance at key milestones. One line confirming the deliverable was received and approved is worth more than a folder of drafts.
• Audit your checkout page against section 32 of O. Reg. 17/05. Seller identity and contact details, an accurate description, itemised prices including taxes and shipping, additional charges, the total, payment terms, delivery and performance timing, and your cancellation and refund terms. Add the express accept-or-decline and error-correction step required by section 38(2).
• Automate the post-purchase copy of the agreement, including the customer's name and the date, and keep the send records.
• Keep delivery evidence by default, not by heroics. Timestamps, confirmations and acceptance emails should be a byproduct of how you work, not something you reconstruct under pressure.

If your terms of service have not been looked at since you wrote them, that is the highest-value hour available here. A contract lawyer in Toronto can review the agreement, the checkout flow and the refund policy together, which is the only way to see whether they actually line up with each other.

Key takeaways

• A chargeback is a payment decision, not a judgment. Losing one does not extinguish a debt; winning one does not resolve a claim the customer may still have.
• Find the deadline in your notice first. Network and processor timelines vary — never work from a number in an article.
• The consumer/business fork decides most of the analysis. Section 1 defines a consumer as an individual acting for personal, family or household purposes, expressly excluding a person acting for business purposes.
• Section 99 is not a general dissatisfaction remedy. Section 99(3) requires an underlying cancellation or refund right under the Act plus your failure to refund within the required period.
• The clock is 15 days, then 60. Refund within 15 days of notice (O. Reg. 17/05, s. 79(1)); the consumer's signed request goes to the issuer within 60 days after that period ends (s. 85(1)).
• The issuer's deadline is the second statement of account after the request (s. 85(4)) — not "two billing cycles or 90 days," despite what circulates online.
• Paperwork creates the cancellation rights. One year to cancel a future performance agreement without a compliant copy (s. 23); 30 days for an internet agreement without a compliant copy (s. 40(2)); seven days after the copy where disclosure or the accept-or-decline step was missing (s. 40(1)).
• "No refunds" does not beat the statute. Section 7(1) applies the Act's rights despite any agreement or waiver, and section 93(1) makes a non-compliant consumer agreement non-binding on the consumer, subject to the court's discretion in section 93(2).
• Do not re-charge the card. Re-invoice instead — an unlawful charge can start a fresh reversal route under sections 98 and 99(2).
• If you sue, it is Small Claims for most of these. $50,000 exclusive of interest and costs, and leave is required to start a Small-Claims-sized action in the Superior Court (Courts of Justice Act, s. 23(1.1)).
• Serve your documents 30 days before trial. Rule 18.02(1) is what gets receipts, invoices and written statements into evidence — with the author's contact details appended under rule 18.02(3).

Frequently asked questions

Can I sue a customer in Ontario after they win a credit card chargeback?

Sometimes, but the chargeback outcome does not decide it. A chargeback is a payment dispute run by the card issuer, acquirer and network under private contractual rules; it is not a court determining whether the customer owes you money. So losing one does not extinguish a debt, and winning one does not immunise you from a claim. What decides whether you can collect is the underlying position: whether there was an enforceable agreement, whether you actually performed, whether the buyer was a consumer with statutory rights, and whether your records prove both liability and the amount. If the customer had a valid cancellation right under the Consumer Protection Act, 2002 and you did not refund, suing may simply move the loss and add costs to it. Get advice on the specific agreement and facts before you send anything that commits you to a position.

Is a card-network chargeback the same as the Consumer Protection Act chargeback?

No, and conflating them is the most common mistake I see. The card-network process is contractual: it runs through your acquirer or processor under network rules and your merchant agreement, with its own reason codes and deadlines. Section 99 of the Consumer Protection Act, 2002 is a separate statutory route that runs from the consumer to the credit card issuer. Section 99(3) makes clear it is only available where the consumer has cancelled a consumer agreement or demanded a refund in accordance with the Act and the supplier has not refunded all of the payment within the required period. That means the statutory route depends on there being an underlying cancellation or refund right under the Act in the first place. Dissatisfaction on its own does not create one — though note the qualifier: a customer unhappy about quality who also never received a compliant copy of the agreement may be able to cancel under section 23 or section 40(2), and those rights do not ask why the customer is unhappy. Either way, a customer with no statutory entitlement can still file an ordinary network chargeback, which is why the two processes are so often confused.

How long does a consumer have to demand a section 99 credit card reversal in Ontario?

Under section 85(1) of O. Reg. 17/05, the consumer's request must be given to the credit card issuer within 60 days after the end of the period within which the supplier was required under the Act to refund the payment. That refund period is itself 15 days after the consumer gives notice of cancellation, under section 79(1) of the regulation. The request must be in writing, signed, and set out the prescribed details in section 85(2) — including the account number, the specific charges, the date the agreement was cancelled and the method used to give the supplier notice. The issuer must acknowledge the request within 30 days under section 85(3), and under section 85(4) the period for it to act ends on the date of the second statement of account delivered to the consumer after the request was given. Note that last point: it is a statement-of-account measure, not the "two billing cycles or 90 days" figure often repeated online.

Does a "no refunds, all sales final" policy stop a chargeback?

Not against a consumer with statutory rights. Section 7(1) of the Consumer Protection Act, 2002 provides that the substantive and procedural rights given under the Act apply despite any agreement or waiver to the contrary. So a refund policy can govern the goodwill refunds you offer voluntarily, and it can do real work in a business-to-business sale, but it cannot remove a cancellation right the statute confers. There is a second provision worth knowing: section 93(1) says a consumer agreement is not binding on the consumer unless it is made in accordance with the Act and the regulations. Section 93(2) softens that — a court may order the consumer bound anyway if it would be inequitable in the circumstances not to — but you do not want to be relying on a discretionary saving provision as your compliance plan.

Is my customer a "consumer" under Ontario law if they bought for their business?

No. Section 1 of the Consumer Protection Act, 2002 defines a consumer as "an individual acting for personal, family or household purposes" and expressly excludes "a person who is acting for business purposes." That single question reshapes the analysis: a genuine business-to-business buyer has no statutory cancellation rights, no section 99 route, and no protection from section 7(1) against your contractual terms, so the dispute is governed by the contract you actually made. The trap is the mixed case — the sole proprietor buying something used at home and at work, or the individual who paid personally for a company expense. Do not assume the answer from the payment method or the invoice name. Note also section 2(1): the Act applies where the consumer or the person engaging in the transaction is located in Ontario, so an Ontario business selling online to consumers elsewhere is generally inside the Act.

What evidence do I need to sue after a chargeback in Ontario Small Claims Court?

You must prove both that the defendant is liable and the amount owing, which in a chargeback case means the agreement, the performance and the loss. In practice that is the signed proposal or checkout record, the terms in force at the time, the invoice and payment authorization, the scope and deliverables, change orders and written approvals, proof of delivery or performance with timestamps, the customer's communications complaining or cancelling, and anything you offered by way of remedy. Rule 18.02(1) of the Rules of the Small Claims Court provides that a document, written statement, or audio or visual record served on all parties served with the notice of trial at least 30 days before the trial date shall be received in evidence unless the trial judge orders otherwise. Rule 18.02(2) expressly includes financial records, receipts, bills and documentary evidence of loss, and rule 18.02(3) requires you to append the name, telephone number and address for service of the witness or author. Missing that 30-day window is one of the more avoidable ways to weaken an otherwise sound claim.

Can I just re-charge the customer's card or re-invoice them?

Re-charging a card without fresh authorization is a poor idea on every axis. Commercially, forcing a second charge through after a reversal is the kind of conduct that draws processor scrutiny and can put your merchant account at risk. Legally, if the original payment was one the customer had a statutory right to have refunded, taking it again does not improve your position and may create a new problem: section 98(1) of the Consumer Protection Act, 2002 allows a consumer to demand a refund of an amount charged or received in contravention of the Act within one year, and section 99(2) makes a payment received or charged in contravention of the Act its own trigger for a credit card reversal. Re-invoicing is different and is often perfectly reasonable — an invoice is a demand, not a self-help remedy. Send it with the contract, the delivery proof and a clear statement of the amount, and treat it as the first step of a collection process rather than the end of one.

Is it worth suing for the amount of a chargeback?

That is a commercial question before it is a legal one, and the honest answer is often no for small amounts. Weigh the size of the claim against filing and service costs, the time the case will take, the recoverability of costs, and — the factor most people skip — whether the defendant can actually pay a judgment. A judgment you cannot enforce is an expensive piece of paper. The Small Claims Court can hear claims up to $50,000 exclusive of interest and costs, and you can model the trade-off with the settle-versus-court calculator on this site before committing. Where the amount is genuinely small, a well-drafted demand letter and a negotiated partial refund frequently produce a better net outcome than a claim, and it is worth pricing that option honestly rather than treating it as giving in.

Final thoughts

The hardest thing about a chargeback after completed work is that it feels like a verdict, and it is not one. It is a payment decision made quickly, on limited information, under private rules written by people with no view on your contract. Treating it as the end of the story leads businesses to write off money they could collect. Treating it as obviously wrong leads them to spend money chasing customers who had a statutory right to their refund all along.

The distinction that separates those two outcomes is usually not about who behaved better. It is about the paperwork — whether there was a written agreement, whether the customer received a copy of it, whether the disclosure was made before they committed, and whether you can prove you delivered. Ontario's consumer legislation attaches real consequences to those questions, and it attaches them regardless of how good the work was.

Which is the practical reason to deal with this now rather than during the week it happens. The same half-day spent on your agreement, your checkout flow and your delivery records both reduces the number of chargebacks you face and gives you something to work with when one arrives anyway.

If a customer has reversed a payment after you delivered, bring the agreement, the invoice, the dispute notice and your delivery records to a consultation. The first question is not whether you lost the chargeback — it is whether there is still a legally supportable and commercially worthwhile debt to collect. A business lawyer in Toronto can work through that with you. Call 416-554-1639 or book a free consultation.

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