S. 4 of the Limitations Act is always at the top of a lawyer’s checklist when they’re advising a client. From the very outset of the retainer, clients are informed of any potential limitation period issues and encouraged to assert all of their claims in a timely manner.
The case of Total Meter Services Inc. v. GVM Integration, 2025 ONCA 321 provides a useful reminder that when a client raises new allegations during the course of the retainer, it’s advisable that their case is carefully reviewed and re-assessed to ensure that their claims do not raise new causes of action that may already be statute-barred.
The Facts
The respondent company commenced a claim against the appellants in 2014 pleading breach of fiduciary duty, breach of confidence and breach of contract. The respondent alleged that one of the appellants, a former employee, had copied confidential information and software and removed it from the respondent’s premises, later using that confidential information to create competing software (the “Original Claim”).
Thereafter, in September 2020, the respondent amended its claim to allege that the appellant former employee had breached his fiduciary obligations to the respondent by appropriating corporate opportunities involving a particular customer (the “Amended Claim”). Consenting to the amendments, the appellants also reserved the right to argue that the Amended Claim was statute-barred under the Limitations Act. It was common ground between the parties that the date of discoverability of the Amended Claim was May 8, 2013.
The trial court ruled in favour of the respondent, granting judgment in their favour with regard to the Original Claim and Amended Claim. In the reasons for decision, however, the trial court did not address the Limitations Act defence.
On appeal, the appellants argued that the trial court erred by (1) drawing an adverse inference in assessing the appellant former employee’s credibility and (2) not having considered the Limitations Act in its decision.
For present purposes, this article will discuss the latter of the two issues.
The Appellate Decision on the Limitations Act Defence
The respondent contended that the Amended Claim was not a new cause of action but merely pleaded additional facts as the bases for the original causes of action of breach of fiduciary duty, breach of confidence and breach of contract. Moreover, the respondents argued, the trial judge was presumed to know the law and had implicitly considered the Limitations Act defence.
The Ontario Court of Appeal disagreed.
The Original Claim pleaded misconduct by the appellant former employee two days before the end of his employment on November 30, 2012 with the respondent. There was no mention in the Original Claim of the particular customer identified in the Amended Claim nor did the respondent plead that the appellant former employee communicated inappropriately with the respondent’s clients. The Original Claim focused on the appellant’s actions in copying confidential information after November 30, 2012 when he resigned.
Importantly, in its ratio, the Court had this to say:
“An amendment to a statement of claim will be refused if it seeks to assert a new cause of action after the expiry of the applicable limitation period [citation omitted]. In this context, “cause of action” refers to “a factual situation the existence of which entitles one person to obtain from the court a remedy against another person,” [Emphasis added.] rather than the legal label attached to a claim (such as a “breach of fiduciary duty”) [citation omitted]. In considering whether an amendment raises a new cause of action, the court must consider whether the original pleading already contains the factual matrix – the acts or omissions said to give rise to liability – to support the claim in the proposed amendment, or whether the proposed amendment seeks to put forward additional facts that are necessary to a new and different claim [Emphasis added.]. In conducting this assessment, the court must read the pleadings generously, in favour of the proposed amendment [citation omitted].
In addition, the Court of Appeal also did not accept the respondent’s argument that the trial judge had implicitly considered the Limitations Act defence. The trial judge did not make any mention of it in her reasons for decision and, further, the Limitations Act defence was absent from her list of issues in the reasons for decision.
In the circumstances, the Court of Appeal determined that the appropriate remedy was to deduct from the total damages awarded the damages attributable to the Amended Claim.
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