By Gemma Healy-Murphy
The Ontario Court of Appeal recently considered s. 5 of the Limitations Act, 2002 and provided a helpful reminder of the principles governing discoverability of claims, including the factor set out in s. 5(1)(a)(iv) regarding the appropriateness of bringing a proceeding:
5 (1) A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury, loss or damage had occurred,
(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,
(iii) that the act or omission was that of the person against whom the claim is made, and
(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and
(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a). 2002, c. 24, Sched. B, s. 5 (1).
In Dass v. Kay[1], Justice Fowler Byrne granted the defendants’ motion for summary judgment on grounds that the plaintiffs’ claims were statute-barred. The Court of Appeal was tasked with considering whether in doing so, Her Honour erred in law by misinterpreting s. 5 of the Limitations Act, 2002 and/or made palpable and overriding misapprehensions of fact.
In short, the appellate court rejected the plaintiffs’ appeal on both counts, and upheld the decision of the motion judge.
In discussing whether the motion judge erred in her analysis under s. 5 of the Limitations Act, and specifically s. 5(1)(a)(iv), the Court of Appeal reiterated its decision in Sosnowski v. MacEwan Petroluem Inc.[2], where Hourigan J.A. distilled the Court’s jurisprudence interpreting s. 5(1)(a)(iv) into three principles:
- The determination of whether a proceeding is an appropriate means to seek to remedy an injury, loss, or damage depends on the factual and statutory context of each case.[3]
- There are two non-exclusive factors that can operate to delay the date on which a claimant would know that a proceeding would be an appropriate means to remedy a loss:
- when the plaintiff relied on the defendant’s superior knowledge and expertise, particularly where the defendant has taken steps to ameliorate the plaintiff’s loss; and
- where an alternative dispute resolution process offers an adequate remedy, and it has not been completed.[4]
- “Appropriate” means that it is legally appropriate to bring a proceeding, rather than practically advantageous. This third principle excludes from consideration many practical and tactical reasons a claimant might have for not commencing a proceeding at an earlier time when it was legally appropriate to do so, such as the belief that the claim might be difficult to prove. Put differently, “[a]ppropriate does not include an evaluation of whether a civil proceeding will succeed”.[5]
In Dass, the plaintiffs were unable to convince either court that their claims came within either situation articulated above to delay the start of the limitation period. They were found to have never been delayed in bringing an action on the basis that they were dependent on the defendants for information, an understanding of their position, or efforts to remedy the damage they claim to have suffered.
Nor were the plaintiffs found to have engaged in an alternative dispute resolution process with the defendants, such that it would be unfair not to take that process into account in determining the earliest date the plaintiffs’ claim was discoverable to them.
The Court of Appeal again specifically rejected the notion that the date of discoverability regarding the appropriateness of bringing a proceeding can be delayed until such time that the plaintiffs are in a position to marshal the evidence to prove the claim and are sure that the scale of the eventual commercial loss will make an action remunerative. To do so would defeat the purpose of the Limitations Act to give certainty to potential litigants.
Interestingly, and leaving the door ajar for other cases, the Court of Appeal recognized that a litigant might propose another set of circumstances in which it could be said, on a principled basis, that they could not have known that an action would be an appropriate means to remedy the injury, loss, or damage.
[1] Dass v. Kay, 2021 ONCA 565 (CanLII)
[2] Sosnowski v. MacEwan Petroleum Inc., 2019 ONCA 1005, 441 D.L.R. (4th) 393, at paras. 16-19.
[3] Sosnowski, at para. 16.
[4] Sosnowski, at para. 17.
[5] Sosnowski, at paras. 18-19.
By Gemma Healy-Murphy
The Ontario Court of Appeal recently considered s. 5 of the Limitations Act, 2002 and provided a helpful reminder of the principles governing discoverability of claims, including the factor set out in s. 5(1)(a)(iv) regarding the appropriateness of bringing a proceeding:
In Dass v. Kay[1], Justice Fowler Byrne granted the defendants’ motion for summary judgment on grounds that the plaintiffs’ claims were statute-barred. The Court of Appeal was tasked with considering whether in doing so, Her Honour erred in law by misinterpreting s. 5 of the Limitations Act, 2002 and/or made palpable and overriding misapprehensions of fact.
In short, the appellate court rejected the plaintiffs’ appeal on both counts, and upheld the decision of the motion judge.
In discussing whether the motion judge erred in her analysis under s. 5 of the Limitations Act, and specifically s. 5(1)(a)(iv), the Court of Appeal reiterated its decision in Sosnowski v. MacEwan Petroluem Inc.[2], where Hourigan J.A. distilled the Court’s jurisprudence interpreting s. 5(1)(a)(iv) into three principles:
In Dass, the plaintiffs were unable to convince either court that their claims came within either situation articulated above to delay the start of the limitation period. They were found to have never been delayed in bringing an action on the basis that they were dependent on the defendants for information, an understanding of their position, or efforts to remedy the damage they claim to have suffered.
Nor were the plaintiffs found to have engaged in an alternative dispute resolution process with the defendants, such that it would be unfair not to take that process into account in determining the earliest date the plaintiffs’ claim was discoverable to them.
The Court of Appeal again specifically rejected the notion that the date of discoverability regarding the appropriateness of bringing a proceeding can be delayed until such time that the plaintiffs are in a position to marshal the evidence to prove the claim and are sure that the scale of the eventual commercial loss will make an action remunerative. To do so would defeat the purpose of the Limitations Act to give certainty to potential litigants.
Interestingly, and leaving the door ajar for other cases, the Court of Appeal recognized that a litigant might propose another set of circumstances in which it could be said, on a principled basis, that they could not have known that an action would be an appropriate means to remedy the injury, loss, or damage.
[1] Dass v. Kay, 2021 ONCA 565 (CanLII)
[2] Sosnowski v. MacEwan Petroleum Inc., 2019 ONCA 1005, 441 D.L.R. (4th) 393, at paras. 16-19.
[3] Sosnowski, at para. 16.
[4] Sosnowski, at para. 17.
[5] Sosnowski, at paras. 18-19.