Two aspects of the Court of Appeal decision in Abrahamovitz v. Berens are noteworthy.
First, the court explains why the expiry of the limitation period is a defence that must be pleaded in enough detail to makes this a candidate for leading decision on the principle:
[30] This court explained in Beardsley v. Ontario (2001), 2001 CanLII 8621 (ON CA), 57 O.R. (3d) 1 (C.A.), at para. 21 that “the expiry of a limitation period does not render a cause of action a nullity; rather, it is a defence and must be pleaded”. See also:Strong v. Paquet Estate (2000), 2000 CanLII 16831 (ON CA), 50 O.R. (3d) 70 (C.A.), at paras. 35-37; Tran v. University of Western Ontario, 2016 ONCA 978 (CanLII), 410 D.L.R. (4th) 527, at para. 18; and Salewski v. Lalonde, 2017 ONCA 515 (CanLII), 137 O.R. (3d) 750, at para. 43.
[31] There are two aspects to the statement from Beardsley. One is that from a procedural fairness point of view, a plaintiff is entitled to plead in response to a limitations defence, so that if a motion is brought to dismiss the claim, the court will have all the facts relied on to assess discoverability, or whatever other factors a plaintiff may wish to raise in response: Beardsley, at para. 22;Strong Estate, at para. 38; Metropolitan Toronto Condominium Corp. No. 1352 v. Newport Beach Development Inc., 2012 ONCA 850 (CanLII), 113 O.R. (3d) 673, at paras. 115-116; and Greatrek Trust S.A./Inc. v. Aurelian Resources Inc., [2009] O.J. No. 611 (Ont. S.C.J.), at para. 18.
[32] The requirement that an affirmative defence, including a limitations defense, be pleaded to avoid surprise to the opposite party is reflected in r. 25.07(4) of the Rules of Civil Procedure, which provides:
In a defence, a party shall plead any matter on which the party intends to rely to defeat the claim of the opposite party and which, if not specifically pleaded, might take the opposite party by surprise or raise an issue that has not been raised in the opposite party’s pleading.
[33] The second aspect of the statement from Beardsley, however, is more germane to this case. A limitations defence is “just that, a defence”: Lacroix (Litigation Guardian of) v. Dominique, 2001 MBCA 122 (CanLII), 202 D.L.R. (4th) 121, at para. 18. A defendant chooses whether or not to rely on a limitations defence, but is not obliged to do so: Graeme Mew, Debra Rolph, & Daniel Zacks, The Law of Limitations, 3rd ed. (Toronto: LexisNexis Canada Inc., 2016) p.166. See e.g.: Strong Estate, at paras. 35-40; and Girsberger v. Kresz (2000), 2000 CanLII 22406 (ON SC), 50 O.R. (3d) 157 (C.A.), at para. 13.
[34] The fact that the choice belongs to the defendant is codified in s. 22 of the Limitations Act, 2002, which allows a limitation period to be suspended or extended by agreement.
[35] This is a very important and useful provision that allows parties to a potential claim to suspend the running of a limitation (toll the limitation period) to allow them to conduct investigations or settlement discussions, without pressure on the claimant to commence the action unnecessarily. It promotes judicial economy and is cost-effective for the parties.
[36] Obviously, this provision would be ineffective if another party could assert the limitation period in spite of the defendant’s agreement to toll the limitation period, or if the action became a nullity on the expiry of the limitation period. See for example, Schreiber v. Lavoie (2002), 2002 CanLII 49430 (ON SC), 59 O.R. (3d) 130 (S.C.J.), where a third party was not entitled to rely on r. 29.05(1) (a rule which allows a third party to plead a defence not raised by the defendant) to assert a limitations defense that the defendant had expressly agreed it would not rely on.
Second, there is a reminder that special circumstances doctrine is of no application:
[24] I would not accept this argument for two reasons. First, the Estate has not commenced any proceeding or claimed any relief. The essence of this argument amounts to invocation of the old common law doctrine of special circumstances that no longer applies under the Limitations Act, 2002. See: Joseph v. Paramount Canada’s Wonderland, 2008 ONCA 469 (CanLII), 90 O.R. (3d) 401. The Estate is essentially saying that because all of the facts have already been pleaded in the action, there is no surprise and no prejudice to the defendants (or other parties) to allow the Estate to be added as a party now, even though the limitation period has expired.
