In Bailey v. Milo-Food & Agricultural Infrastructure & Services Inc., the Court of Appeal held that in a wrongful dismissal action, the cause of action for wrongful dismissal arises on the date of the termination notice:
[5] The appellant submits that the motion judge erred in concluding that his cause of action for wrongful dismissal arose on the date he was provided notice and not on the last day he worked for Milo-FAIS. He argues that the motion judge’s reliance on Jones v. Friedman, 2006 CanLII 580 (ON CA), 2006 CarswellOnt 120 (C.A.) in this regard was misplaced. His submission is that the motion judge erred by conflating actual dismissal with notice of future dismissal, since in Jones the date of dismissal, as pleaded, coincided with the date of notice. According to the appellant, subsequent trial decisions relying on Jones have continued to conflate these dates.
[6] We do not give effect to this submission and decline to adopt the restrictive interpretation of Jones urged upon us by the appellant. In Jones the notice of termination was given on December 12, 1994 and the employment ended on January 31, 1995. The breach the appellant relied on occurred on December 12, 1994 when his employment was terminated without reasonable notice. This court fully appreciated the context, and decided the date of notice of termination was when the limitation period began. Jones stands for the principle that a cause of action for wrongful dismissal arises on the date of notice of termination. The motion judge made no error in his reliance on that case or in striking the wrongful dismissal claim.
This is an example of the misapplication of common law principles to a Limitations Act analysis. Limitation periods under the Act commence on discovery of a claim, not the accrual of a cause of action.
The words “cause of action” do not appear in the Limitations Act. It is the discovery of a “claim”, not a cause of action, that commences time. This is by design. Cause of action accrual was a leading grievance in the movement to reform the former limitations scheme; it required a confounding, even esoteric analysis that resulted in ambiguity and confusion. Here are the essential differences between a “claim” and a cause of action:
- A “claim” as defined by the Limitations Act is materially different than a cause of action. A “claim” is purely a limitations concept, whereas a cause of action is what entitles a plaintiff to relief from the court. A claim has only two factual components (wrongful conduct and resulting damage), whereas a cause of action may have multiple factual components (like negligent misrepresentation, which has five). Damage is always a component of a “claim”, whereas it is not always a component of a cause of action (such as breach of contract).
- Discovery of a “claim” is materially different from discovery of a cause of action. Discovery of a “claim” requires knowledge that a proceeding is an appropriate remedy, whereas at common law, discovery of a cause of action requires knowledge of its material facts. The appropriateness of a proceeding as a remedy is not a material fact of any cause of action.
- “Claims” and causes of action are connected. The cause of action informs the content of the “claim”. The wrongful conduct in the cause of action is the wrongful conduct in the Claim. The damage that is relevant to the wrongful conduct, whether it forms part of the cause of action or not, is the damage in the Claim.
