Tag: limitations act

14 Oct

Applying the new standard for limitation periods

Diana Betlej Uncategorized Tags: , , 0 Comments

On Tuesday we discussed Grant Thornton LLP v. New Brunswick, 2021 SCC 31, and the new test for when a limitation period is triggered in New Brunswick under the Limitation of Actions Act (“LAA”).

The Requisite Degree of Knowledge

Thornton established that the new standard going forward for triggering the two-year limitation period requires that “the plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendant’s part can be drawn. This approach… remains faithful to the common law rule of discoverability set out in Rafuse and accords with s. 5 of the LAA” (Para 42).

Actual or constructive knowledge is furthered described by the LAA. In addition, a plaintiff will have constructive knowledge when the evidence shows that the plaintiff ought to have discovered the material facts by exercising reasonable diligence (para 44).

Plausible Inference of Liability

The final step that needs to be taken by the plaintiff is to “draw a plausible inference of liability on the part of the defendant from the material facts that are actually or constructively known” (para 45).  This requires the degree of knowledge needed to discover a claim is higher than just mere suspicion or speculation. This is in line with the “principles underlying the discoverability rule, which recognize that it is unfair to deprive a plaintiff from bringing a claim before it can reasonably be expected to know the claim exists” (para 46).

As previously mentioned, it is likely that going forward this new standard triggering the limitation period will apply in Ontario as well as other common law provinces going forward.

Thank you for reading.

Diana Betlej

25 Jun

Text Messages and Signatures

Paul Emile Trudelle General Interest, Litigation Tags: , , , , , , , , 0 Comments

Can a text message be tantamount to a signed acknowledgment?

Yes, according to the recent Ontario Divisional Court decision in 1475182 Ontario Inc. o/a Edges Contracting v. Ghotbi.

There, the court considered the application of certain provisions of the Limitations Act, 2002. Essentially, under the Act, a claim must be started within two years of the act or omission giving rise to the claim. However, under s. 13 of the Act, the date for a claim for payment can be extended where the debtor acknowledges the debt to a creditor IN WRITING and SIGNED BY THE PERSON MAKING IT OR THE PERSON’S AGENT.

In Edges, a contractor sued for money owing for renovation work. The last payment under the contract was made in March 2016. The claim was not commenced until May, 2018, and the defendant argued that the claim was statute-barred. However, the defendant texted the contractor in June, 2016, saying “The balance will be paid once everything is completed as per your agreement. No payment will be made until everything is clear. I’m going to hire a third-party inspector and their fees will be deducted from your payments too.”

The contractor argued that this was an acknowledgment of the debt, and therefore extended the limitation period. The defendant countered by arguing that the text was not signed, and therefore did not have that effect. The Small Claims Court judge and the Divisional Court disagreed.

On the issue of whether the text satisfied the statutory requirement that the acknowledgement be “signed”, the Divisional Court noted that there was no issue as to whether the text was authentic, or sent by the defendant. The Divisional Court held:

  1. The requirement of a signature is grounded in concerns of authenticity. As there was no issue with respect to the authenticity of the text, the underlying purpose of the signature requirement was satisfied.
  2. In any event, the Divisional Court concluded that the text was “signed”, albeit not in the traditional sense. The text was sent from the defendant’s cell phone. The phone had a unique phone number, and “other unique identifiers associated with … [the defendant’s] phone, including, without limitation, an International Mobile Equipment Identifier (IMEI) number. These unique identifiers provide, in effect, a digital signature on every message sent by the user of that particular device.”

The Divisional Court observed that “The world is changing. Everyone knows that. We live in a digital world now, much more than was the case when the Act came into force in 2002. It is incumbent upon the court to consider not just traditional means of affixing one’s signature to a document, but other, more modern means, including digital signatures.”

The world is indeed changing. Text with caution.

Have a great weekend.

Paul Trudelle

11 May

When Exactly Does the Two Year Limitation Period Expire?

Kira Domratchev Litigation Tags: , , , 0 Comments

As we all know, claims must be commenced in a timely fashion. If too much time passes, a claimant may be precluded from commencing their claim. That is referred to as a limitation period.

In Ontario, the Limitations Act, 2002, SO 2002, c. 24 governs the question of limitation periods. In accordance with section 4 of this Act, the basic limitation period for commencing proceedings is two years from the time the claim was discoverable.

The specific wording of section 4 is as follows:

“Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered”

When reading this, an interesting question comes to mind, in that, when does the limitation period expire, exactly?

I reviewed some of the cases that interpreted this provision (and there are well over 1,000 reported decisions that address it) and found a few interesting cases:

  • In the decision of Winmill v Woodstock Police Services Board, 2017 ONSC 2528, the Court addressed the question of a limitation period in the context of an altercation with the police that occurred on June 1, 2014. The Court found that the two year limitation period expired on June 1, 2016 – meaning exactly two years from the date of the incident.
  • In the case of Seenergy Foods Ltd v Ready Go Transport Inc, 2019 ONSC 4562, the Court addressed the question of whether the moving party was out of time to add a defendant to an ongoing action. For context, an examination for discovery took place on January 26, 2018 and the name of the proposed defendant was provided by way of an answer to an undertaking on November 12, 2018. The Court found that the limitation period did not expire earlier than January 26, 2020 and most likely not until November 12, 2020. In this case, the Court was also of the position that the limitation period expires exactly two years from the date that the claim was discovered.
  • In Prescott v Barbon, 2015 ONSC 7689, the Court addressed whether the plaintiff was out of time to pursue a claim relating to a motor vehicle accident that took place on December 28, 2008. The Court found that because December 28, 2010 was a holiday, the limitation period did not expire until the end of December 29, 2010. It is important to consider that the Court made its decision in reliance on whether or not the Court was opened so that the plaintiff could issue the claim. In light of that, I read this decision to suggest that the two year limitation period expired on December 29, 2010 at 5 p.m.

Thanks for reading!

Kira Domratchev

Find this blog interesting? Please consider these other related posts:

How to Deal with the Two-Year Limitation Period under Section 38(3) of the Trustee Act

Incapacity, Limitation Periods and Litigation Guardians: Complications Galore

Trustee Act – Limitation Periods and Discoverability

08 Apr

Incapacity to Sue under section 7 of the Limitations Act, 2002

Doreen So Capacity, Continuing Legal Education, Estate & Trust, Estate Litigation, Ethical Issues, Uncategorized Tags: , , , , 0 Comments

The basic limitation period under section 4 of the Limitations Act, 2002 provides that a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.  However, pursuant to section 7(1) of the Act,  the “clock” does not run when the person with the claim,

(a)  is incapable of commencing a proceeding in respect of the claim because of his or her physical, mental or psychological condition; and

(b)  is not represented by a litigation guardian in relation to the claim.

A person is also presumed to be capable of commencing a proceeding in respect of a claim at all time unless the contrary is proved (section 7(2)), although minors are dealt with separately under section 6 of the Act.

The issue of the plaintiff’s capacity to commence a proceeding in respect of his claim was considered at length by the Court of Appeal in Carmichael v. GlaxoSmithKline Inc., 2020 ONCA 447Carmichael is a tragic case involving the murder of the plaintiff’s 11 year old son.  The plaintiff strangled his son to death in 2004 when he was suffering from mental illness and psychotic delusions.  During this time, the plaintiff was also taking an anti-depressant that was manufactured by the defendant drug company.  The plaintiff was charged with murder and he was found to be not criminally responsible as a result of his mental disorder.  He later received an absolute discharge from the Ontario Review Board on December 2, 2009.  Nearly two years after that, the plaintiff commenced his claims against the drug company on October 5, 2011.

The defendant drug company brought a motion for summary judgment to dismiss the plaintiff’s claim as statute barred.  The motions judge dismissed the motion because he found that the plaintiff was incapable of commencing a proceeding because of his psychological condition until the day of his absolute discharge from the Ontario Review Board.  The Court of Appeal disagreed.

The Court of Appeal affirmed the use of the Huang/Hengeveld indicators as a list of non-exhaustive, objectively verifiable indicators of incapacity under section 7(1)(a) of the Act (see paras. 94-96):

  • a person’s ability to know or understand the minimum choices or decisions required to make them;
  • an appreciation of the consequences and effects of his or her choices or decisions;
  • an appreciation of the nature of the proceedings;
  • a person’s ability to choose and keep counsel;
  • a person’s ability to represent him or herself;
  • a person’s ability to distinguish between the relevant and irrelevant issues; and,
  • a person’s mistaken beliefs regarding the law or court procedures.

Moreover, the plaintiff’s physical, mental, or psychological condition must be the cause for the incapacity in order to meet section 7(1)(a).  The incapacity cannot arise from other sources, such as lack of sophistication, education, or cultural differences (para. 101).

The Court of Appeal ultimately found that the plaintiff had the capacity to sue the defendant drug company prior to his absolute discharge from the Ontario Review Board.  The Court disagreed with the motions judge’s view of the plaintiff’s expert evidence.  The plaintiff’s expert witness was criticized for never having prepared a capacity assessment before and for making conclusions that were unsupported by the evidence.  Rather,

“The evidence shows that Mr. Carmichael had several reasons for not suing GSK before December 2, 2009: he did not believe he had the necessary expert evidence until he received the genetic test from Dr. Lucire in October 2009; he was worried about repercussions if the Hospital decided that he was not taking responsibility for his actions; and he was concerned for his own and his family’s well-being. These are understandable reasons for not commencing a lawsuit. But in my view, none of these reasons, alone or together, prove that Mr. Carmichael was incapable of suing GSK until December 2, 2009 because of his psychological condition.” (para. 163)

Leave to appeal to the Supreme Court of Canada was denied last week.

Thanks for reading!

Doreen So

30 Sep

The Ontario Court of Appeal: Not All Roads Will Get You There

Suzana Popovic-Montag Estate & Trust Tags: , , , , , 0 Comments

In June of this year, the Divisional Court of Ontario clarified that Section 10(1) of the Estates Act did not supersede the Courts of Justice Act where leave is required in order to appeal an interlocutory order.

In Luck v. Hudson Re: Estate of Albert Luck, the court however did grant leave, in order to immediately dismiss an appeal that raised issues not heard by the judge in the court of first instance and revealed ulterior concerns.

Steven Luck is the son of the late Albert Luck. Albert owned a house jointly with his wife Marylou Hudson. The relationship between Steven and Albert had deteriorated during Albert’s life and litigation ensued. Albert sued his son, who in turn filed a counterclaim- skidoos and cottage upgrades were all under dispute. Then Albert died, and the Will challenge began.

The motion judge, Justice Salmers, held that money from the sale of the house of Albert and Marylou be paid into court to the credit of the estate of Albert and to be paid out and distributed pursuant to the terms of the Will.

Subsection 10(1) of the Estates Act says that a party to a proceeding under that statute “may appeal to the Divisional Court from an order, determination or judgment if the value of the property affected” exceeds $200. Steven did not seek leave to appeal the interlocutory order and instead relied on 10(1) saying that he had an appeal as of right.

Since only this brief decision is reported, we do not know the underlying dispute which gave rise to Salmers, J’s interlocutory injunction, but the panel made two issues clear:

1: Leave is required to hear an appeal of interlocutory injunction

2: An appeal is not the appropriate venue to raise new issues, or air grievances.

The Courts of Justice Act is clear in section 133 that no appeal lies without leave from an order made on consent, or where the appeal is only to costs. The test for granting leave to appeal from an interlocutory order is an onerous one. If the panel feels the decision was well reasoned and the issues raised are not of general importance (Bell ExpressVu Ltd v Morgan (2008) O.J. No. 4758) leave will not be granted.

In this case, the court determined that Steven was seeking not only to appeal the injunction but that, “at its root the true purpose of that motion was to raise concerns as to the validity of the Will.” While Steven made no objection to the appointment of Trustees or to the Will in first instance, the court went on to say:

“What has become apparent is that Steven Luck wants to contest the Will in order to overturn the distribution of the funds held in court. He wishes those funds to remain available as security for the enforcement of a counterclaim he has made in response to an action commenced by his father (prior to his death) against Steven Luck.”

The court determined that Steven was actually seeking a Mareva injunction: A freezing of the estate assets, as security, in advance of any judgement made, potentially, in his favour.

The court found Steven had not met any of the prerequisites for such an order, and in fact, may have been barred by the Limitations Act, 2002, as previously determined by Justice Salmers.

In the end, as quickly as leave was granted, the appeal was dismissed. And Steven, now on the hook for a $25,000 cost award, was no better off.

A valuable caution to those considering the appeal route.

Thanks for reading!

Suzana Popovic-Montag and Daniel Enright

28 Aug

Incapacity, Limitation Periods and Litigation Guardians: Complications Galore

Paul Emile Trudelle Litigation Tags: , , , , 0 Comments

Under the Limitations Act, 2002, most actions are subject to a two-year limitation period. However, the limitation period does not run during any time in which the person with the claim is incapable of commencing a proceeding AND not represented by a litigation guardian in relation to the claim. A person is presumed to be capable unless the contrary is proved.

What happens when a claim is commenced, but not all defendants are named? This issue arose in the recent decision of Wood v. David Mitchell et al., 2020 ONSC 4903 (CanLII). There, the plaintiff suffered a stroke. He sued a number of defendants in relation to his medical care. One doctor was referred to in the Statement of Claim, but not named as a party. Three years after the claim was started, the Public Guardian and Trustee was appointed as the plaintiff’s litigation guardian. The PGT moved to add the doctor as a defendant. The doctor moved to strike the claim on the basis of the passage of the limitation period.  The plaintiff resisted, taking the position that the plaintiff did not have capacity when the claim was commenced, and did not have a litigation guardian.

The doctor raised two main points. Firstly, the doctor sought information about communications between the plaintiff and his initial lawyers going to his capacity at the time. Secondly, the doctor argued that the plaintiff was represented initially by a “de facto” litigation guardian, a Mr. McQueen.

The decision addressed these issues from the perspective of a motion to compel answers to questions and further production. The plaintiff had refused to answer questions about his and Mr. McQueen’s communications with his initial lawyers and to produce the lawyers’ file on the basis of relevance and privilege.

At first instance, the Master disallowed the questions. On appeal, the court ordered that the lawyers’ files as they relate to the plaintiff’s capacity and to Mr. McQueen’s dealings with the lawyers must be produced, even if privileged.

The court held that on the first issue, as the plaintiff put his capacity in issue, information that his lawyers had about his capacity was to be produced. The court stated that the “elephant in the room” was “what were the plaintiff’s initial lawyers thinking” when they commenced the claim? Did they believe that the plaintiff had capacity? If so, what was that belief based on?

On the second issue, the court referred to the Court of Appeal decision of Azzeh (Litigation Guardian of) v. Legendre, 2017 ONCA 385 for the proposition that a de facto litigation guardian could recommence the running of the limitation period. In Azzeh, the court held that a person could be considered litigation guardian, even if not formally appointed, if they held themselves out as litigation guardian. In Wood, the court held that the definition of “litigation guardian” might even by broader.

As can be seen, the issues that arise in litigation where the capacity of a party may be in issue can be complex. The courts must walk a fine line of ensuring that the right to sue is not taken away from an incapable person, while ensuring that the rights of third parties, including the right to the protection of limitation periods, are safeguarded.

Thank you for reading.

Paul Trudelle

29 Jul

Self-Represented Litigant Defeated by a Limitation

Ian Hull Litigation Tags: , , 0 Comments

Few would have the audacity (or the poor judgment) to perform surgery or fly an airplane without requisite training. The hero of The Simpsons, Homer, (a sad example of his namesake), can often be seen, rather comically, making errors on the job at the Springfield nuclear power plant – and yet there is nothing funny, in real life, about an untrained nuclear technician staring down a crisis. Our world is no longer one in which most people provide all their wants for themselves; instead, trades are highly specialized. Lawyers, for instance, will not typically build their own houses – most, indeed, would not know how to build their own tables. There is temptation, however, in self-sufficiency: one may save money in cutting one’s own hair and gain pride in cooking one’s own meals; and in case of failure, one may always pay one’s expert barber to salvage one’s botched haircut and scramble to one’s favourite restaurant to relieve one’s palate.

Whereas the consequences of conducting surgery or flying an airplane without training are readily apparent to the imagination, the risks associated with self-representation in court can be deceiving. Some think they are – or truly are – qualified to argue their own cases if they do some private research, study the procedures and access free legal resources at their disposal. They may find the endeavour exciting, a personal rite of passage or a challenge from which they may grow. It is a sad truth, as well, that many self-represented litigants simply do not have the financial means to afford legal counsel. Options available to litigants of more modest means – such as legal aid, pro bono and hiring a lawyer on contingency – are often imperfect (and, alas, sometimes unattainable), but they may be preferable to going into the legal fray alone. In any case, Bristol v. Bristol, [2020] O.N.S.C. 1684 (“Bristol”), is a stirring instance of what may go wrong with respect to legal self-representation.

The facts in Bristol are as follows: the matriarch of the Bristol family, Elizabeth, passed away on December 6, 2016, survived by ten children; in 2002, she executed a will in which she distributed her estate equally amongst the ten children; in 2004, she left another will by which she disinherited nine of the children and left her entire estate to Berry, the tenth child. Her stated purpose for disinheriting the nine others was that she had assisted them sufficiently throughout their lives.

On December 30, 2016, one of the disinherited children, Stephanie, filed a Notice of Objection, on behalf of herself and four of her siblings, alleging incapacity and undue influence with respect to the latter will. Berry filed his Notice to Objector on July 18, 2017, and then Stephanie filed a Notice of Appearance on July 25, 2017. After almost two years, during which time Stephanie was allegedly waiting for Berry to “take a step in the probate proceeding”, Stephanie brought a Motion for Directions. This was on April 23, 2019. The Court indicated that she should issue an Application within 45 days but without prejudice to Berry bringing a motion to dismiss on the grounds that the Application was statute-barred, for sections 4 and 5 of the Limitations Act prohibit a proceeding from commencing more than two years after the day on which the claim was discovered.

In its decision, the Court found that the steps Stephanie had taken, namely filing the Notice of Objection and Notice of Appearance, did not commence a proceeding; the former is merely a “caveat” or “caution”, not a proceeding, and the latter does not institute proceedings. She needed to issue an Application. It was next determined that the date of discoverability was either December 6, 2016 (the date of death) or at the latest December 30, 2016 (the date of the Notice of Objection), and that, therefore, the two-year limitation period had expired. As a last resort, Stephanie argued that she was seeking declaratory relief and that no limitation period thus barred her. The Court decreed that “will challenges cannot be framed as declaratory relief”.

There was sympathy for Stephanie’s position, but the Court declined to make an exception for her merely because she was self-represented:

“The Applicant insisted that because she was self-represented and because the Respondent had taken no steps, she was forced to bring a Motion for Directions in April 2019. It was only on the motion date that she learned that she was required to actually issue an Application. While all of this is unfortunate, it does not permit the Applicant to escape the presumption in ss. 4 and 5 of the Act.”

In consideration of Stephanie’s position, however, the Court opted not to order costs for Berry, to which he would have been entitled “in normal circumstances”.

In conclusion, we may finish with three observations. Firstly, as Berry won the case, the Court may have awarded costs against Stephanie. As was mentioned in the decision, estates litigants may have costs awarded against themselves personally – the estate no longer by necessity absorbs the legal costs for all parties. Secondly, had Stephanie hired counsel, it is likely that this procedural error would have been avoided and the will challenge determined on its merits. Engaging counsel would have perhaps carried greater financial risks, but the chance of gain (winning the case, settling) would have also sweetened the prospect. Lastly, Bristol is another lesson that litigants, both trained and untrained, must beware of time, and the limitations it summons, for it can be a stern and unconquerable foe.

Ian Hull & Devin McMurtry

10 Mar

Fraudulent Conveyances and Actions to Recover Land under the Real Property Limitations Act

Christina Canestraro Estate Litigation Tags: , , , , , 0 Comments

An important and useful tool in any estate planning toolkit is the ability to transfer title to real property between spouses, which typically occurs for nominal consideration and/or natural love and affection. These types of transfers are recognized at law. In certain circumstances, transfers of this nature may be used by spouses seeking to defeat, hinder, delay, or defraud creditors. The Fraudulent Conveyances Act (“FCA”) provides the legislative authority to set aside transfers of property that are entered into with the intent to defeat the claims of a creditor.

Such was the case in Anisman v Drabinsky, 2020 ONSC 1197. On September 11, 2015, Mr. Drabinsky and his wife, Ms. Winford-Drabinsky, transferred their joint ownership of their home to Ms. Winford-Drabinsky alone (the “Drabinsky Property”). At the time of said transfer, Mr. Drabinsky had several unpaid judgments against him as well as ongoing monthly debt payments that were nearly double his monthly income. One such judgment, dated November 2018, was in favour of the Plaintiff for monies owed by Mr. Drabinsky.

In an effort to recover monies owed to him, the Plaintiff obtained a Certificate of Pending Litigation against the Drabinsky Property. It was not until April 2019 that the Plaintiff testified that he learned of the transfer through a title search conducted on Mr. Drabinsky in preparation for his examination in aid of execution respecting the unpaid judgment. On June 18, 2019, some three years and nine months after the impugned transfer of title, the Plaintiff commenced an action seeking to reverse the transfer of title in the Drabinsky Property.

In his defence, Mr. Drabinsky argued that the transfer itself was not fraudulent, but that in any event, the Plaintiff’s claim was statute barred given that the 2-year limitation period provided for in the Limitations Act, 2002, SO 2002, c. 24 (“Limitations Act”) had expired.

In considering the validity of Mr. Drabinsky’s limitation defence, the court considered two key principles regarding limitation periods: discoverability of claims and the applicable statutory authority. With respect to the latter, the court considered whether it was the 2-year limitation period pursuant to the Limitations Act, or the 10-year limitation period in the Real Property Limitations Act (RPLA”), that applied. The RPLA applies to actions to “recover” land. The question then became, does an action to set aside a conveyance of real property fall within the category of claims to “recover land”?

The court ultimately found that it was the 10-year limitation period in the RPLA that applied to the present action. In reaching its decision, the court relied on the case of Conde v Ripley, 2015 ONSC 3342, which found that claims made to set aside a conveyance of real property under the FCA are on their face, a claim to recover land. The court went further to say, “the Legislature has seen fit to… differentiate between actions involving recovery of land and other types of actions” given that the Limitations Act addresses claims in contract or tort, while the FCA addresses the recovery of real property.

However, as identified in this article, this line of reasoning contradicts earlier decisions that differentiated between the recovery of land itself and the recovery of debts connected to that land (see Wilfert v McCallum, 2017 ONSC 3853 and the Ontario Court of Appeal case of Zabanah v Capital Direct Lending Corp, 2014 ONCA 872), leaving the law in a state of uncertainty.

Thanks for reading!

Christina Canestraro

20 Jan

No Consequential Relief; No Limits to Will Challenges

Doreen So Continuing Legal Education, Estate Litigation, Executors and Trustees, Litigation, Uncategorized, Wills Tags: , , , 0 Comments

Last week the Court of Appeal dismissed an appeal of Justice Dietrich’s decision in Piekiut v. Romoli, 2019 ONSC 1190, 2020 ONCA 26.

The main issue on appeal was whether Justice Dietrich was right in finding that the applicant could still ask the court to determine whether certain codicils were valid (or invalid) seven years after death.  Justice Dietrich based her limitations analysis on whether this proceeding would fall under section 16(1)(a) of the Limitations Act, 2002 where there is no limitation period in respect of “a proceeding for a declaration if no consequential relief is sought”.

In her reasons, Justice Dietrich distinguished the case before her from the other limitations cases that have applied the two-year, basic limitation period to will challenges: Leibel v. Leibel2014 ONSC 4516, Birtzu v. McCron, 2017 ONSC 1420, and Shannon v. Hrabovsky, 2018 ONSC 6593.  The case before her was different from Liebel, Birtzu, and Shannon because nothing had been done by the respondent beneficiary to propound the codicils that she had an interest in.  If the proceeding was started differently in 2015, by the very beneficiary who has an interest in the codicils, then the estate trustee would have a limitations defence against the beneficiary.  Since the beneficiary had done nothing, it remained opened to the estate trustee to commence an application for declaratory relief.  Such declaratory relief is  “a formal statement by a court pronouncing upon the existence or non-existence of a legal state of affairs.’ It is restricted to a pronunciation on the parties’ rights” (see para. 46, 2019 ONSC 1190).

The Court of Appeal agreed that there was no limitation period in this case because the applicant did not seek consequential relief in addition to a determination of the validity or invalidity of the codicils.   The Will had not been probated and nothing had been done for seven years to resolve the issue.

“In these circumstances, Helen was entitled to seek declaratory relief, simply to establish the validity, or lack of validity, of the codicils – to define the rights of the parties in order to avoid future disputes.”, Strathy C.J.O., MacPherson J.A., and Jamal J.A.

Thanks for reading and more on these limitation cases to follow later this week!

Doreen So

 

11 Jul

Trustee Act – Limitation Periods and Discoverability

Stuart Clark Estate Litigation Tags: , , , , , , , , , , , , , , , , 0 Comments

When most people reference a “limitation period” in Ontario, chances are that they are referencing the limitation period imposed by the Limitations Act, 2002, which generally provides an individual with two years from the date on which a claim is “discovered” to commence a claim before it is statute barred. Although an individual is presumed under the Limitations Act to have “discovered” the claim on the date that the loss or injury occurred, if it can be shown that the individual did not “discover” the claim until some later date the limitation period will not begin to run until that later date, potentially extending the limitation period for the claim to be brought for many years beyond the second anniversary of the actual loss or damage.

Although the limitation period imposed by the Limitations Act must be considered for situations in which an individual intends to commence a claim against someone who has died, individuals in such situations must also consider the much stricter limitation period imposed by section 38 of the Trustee Act.

Section 38 of the Trustee Act imposes a hard two year limitation period from the date of death for any individual to commence a claim against a deceased individual in tort. Unlike the limitation period imposed by the Limitations Act, the limitation period imposed by section 38 of the Trustee Act is not subject to the “discoverability” principle, but is rather a hard limitation period that expires two years from death regardless of whether the individual has actually yet to “discover” the claim. If an individual starts a claim against a deceased individual in tort more than two years after the deceased’s individual’s death it is statute barred by section 38 of the Trustee Act regardless of when the claim was “discovered”.

The non-applicability of the “discoverability” principle to the two year  limitation period imposed by section 38 of the Trustee Act is confirmed by the Ontario Court of Appeal in Waschkowski v. Hopkinson Estate, (2000) 47 O.R. (3d) 370, wherein the court states:

As indicated earlier in these reasons, based on the language of the limitation provision, the discoverability principle does not apply to s. 38(3) of the Trustee Act. The effect of s. 38(3) is, in my view, that the state of actual or attributed knowledge of an injured person in a tort claim is not germane when a death has occurred. The only applicable limitation period is the two-year period found in s. 38(3) of the Trustee Act.” [emphasis added]

Although the Court of Appeal in Waschkowski v. Hopkinson Estate appears firm in their position that the court should not take when the claim was “discovered” into consideration when applying the limitation period from section 38 of the Trustee Act, it should be noted that in the recent decision of Estate of John Edward Graham v. Southlake Regional Health Centre, 2019 ONSC 392 (“Graham Estate“), the court allowed a claim to brought after the second anniversary of the deceased’s death citing “special circumstances”. Although the Graham Estate decision is from the lower court while the Waschkowski v. Hopkinson Estate decision is from the Court of Appeal, such that it is at least questionable whether it has established a new line of thinking or was correctly decided, the Graham Estate decision may suggest that the application of the limitation period from section 38 of the Trustee Act is not as harsh as it was once considered. More can be read about the Graham Estate decision in Garrett Horrocks’ previous blog found here.

Thank you for reading.

Stuart Clark

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