Is commencing a proceeding in respect of a claim determinative of the discovery of that claim? Not always, according to the Court of Appeal in Har Jo Management Services Canada Ltd. V. York (Regional Municipality).
Flood waters flowing from adjacent land, which the respondent municipality had expropriated for a construction project, damaged the appellant’s property.
In 2011, the appellant commenced proceeding before the Ontario Municipal Board claiming damages for injurious affection in respect of the expropriation.
On June 3, 2013, the appellant sent a letter to the respondent stating that its activities on the adjacent land caused the flooding and resulting damage. The respondent denied causing the flooding on June 28, 2013.
The appellant commenced an action two years form the respondent’s denial. The respondent pleaded a limitations defence and move for summary judgment .
The Statement of Claim tracked the language of the appellant’s claim to the respondent. The Motion Judge found that the appellant knew of his claim on the day he issued it.
Not so, held the Court of Appeal. The Expropriations Act provides for damages for injurious affection and gives the OMB exclusive jurisdiction to award such damages. If the flooding damage was caused by the respondent’s construction, the Superior Court would have no jurisdiction to hear the claim.
The appellant’s evidence explained that, to the extent the damage from the flood properly formed part of a claim for damages for injurious affection under the Expropriations Act, it would be part of the appellant’s existing OMB claim. The action was merely “out of an abundance of caution” in case it turned out that the flooding was not caused by the respondent’s construction, but by some other factors that did not meet the definition of injurious affection.
There was no suggestion that something other than the construction might have caused the flooding until the respondent’s June 28, 2013 letter. It was on this date that that appellant knew that a proceeding was an appropriate remedy for a claim against the respondent and not a proceeding before the OMB.
The curious aspect of this decision is that issuing a statement of claim (or even drafting the statement of claim) was not determinative of the discovery of the claim it pleads. There is authority for the principle that it is logically inconsistent for a plaintiff to commence an action before discovering a claim. See also s. 14(3) of the Limitations Act.
It’s certainly hard to understand how a court could find that a statement of claim does not indicate discovery of the claim pleaded in it, or that objective discovery can occur after subjective discovery.
Here, the Court seems to have avoided this problem by finding that the appellant’s evidence demonstrated that the statement of claim did not indicate subjective discovery of the claim. This is likely to happen very rarely, and I expect that this decision will be an outlier.
I think the limitations defence might have been avoided if the statement of claim (which I haven’t seen) had pleaded explicitly that it advanced a claim only in regards of the damage that was not within the OMB’s exclusive jurisdiction.