Ontario: Court of Appeal on the factual nature of discovery

The Court of Appeal decision in Albert Bloom Limited v. London Transit Commission contains a great statement on the factual nature of the s. 5(1)(a) analysis.  When a claimant knows the s. 5(1)(a) discovery matters is fact-specific and there’s little value in comparing the unique facts of one case to another:


[31]      To be clear, the determination of when a claimant obtains actual knowledge of a claim is case-specific. Little is to be gained from comparing the unique circumstances of one case to another. There is no bright-line test that establishes when a party has actual knowledge of a claim. Instead, the totality of factual circumstances will dictate how and when a claimant obtains actual knowledge. In the present case, the motion judge undertook a detailed analysis of the factual circumstances. The evidence she relied on was uncontested, and I do not understand LTC to be arguing that the motion judge committed any palpable and overriding errors of fact.

The decision also shows the consequences of admitting facts material to the discovery analysis in a pleading. The plaintiff argued that such an admission was ignorable “boilerplate”, but filed no evidence to support this argument (also note that the Court found that an affidavit’s double hearsay was inadmissible):


[32]      There is another unique circumstance in this case that supports the motion judge’s finding regarding actual knowledge. It is the plea in the statement of defence and crossclaim that the contamination was caused by a previous owner of the LTC property. That fact clearly distinguishes this case from Crombie, where there was no such plea.

[33]      On the motion and this appeal, LTC attempts to explain away that pleading: it was just a “standard pleading” and did not reflect its actual state of knowledge at the time of the filing of the statement of defence and crossclaim. However, the evidence that counsel had informed the affiant in the affidavit filed by LTC that this was a standard pleading was double hearsay. Contrary to what the affiant stated in her affidavit, on cross-examination, she testified that she had never been provided with this information by LTC’s counsel. In fact, she had received the information from her predecessor at LTC, who apparently was told the information by legal counsel. This evidence was therefore inadmissible on the motion.

[34]      LTC asserts, “[t]here was absolutely no evidence on the record before the Motions Judge to suggest that this pleading was other than a boilerplate pleading commonly set out in environmental defences without any factual knowledge attributable to LTC” : Factum, para. 27.  This submission reflects a fundamental misunderstanding of the onus on the motion. LTC’s onus was not met by asserting that there was no evidence that this was not a boilerplate pleading. LTC had an obligation to adduce compelling and admissible evidence that it was boilerplate and thus could be ignored. It failed to adduce that evidence.

Ontario: admitting liability on cross-examination doesn’t waive the limitation period

An admission of liability on a cross-examination is not a waiver of the limitation period that applies to the claim.

In Cross Bridges Inc. v. Z-Teca Foods Inc., the plaintiff moved for summary judgment for a declaration that it brought its claim in time. (Although not unprecedented, you’re in good company if this seems like an unusual tactic.  Justice Emery’s decision begins with this observation: “It is often said that the best defense is a good offense. The converse is seldom true. Rarely does a plaintiff in a civil action take defensive steps, particularly of a binding nature.”)

The defendant had admitted on cross-examination that it owed to the plaintiff an amount to be determined.  The plaintiff argued that this admission was a waiver of the limitation period. Justice Emery rejected this reasoning.  The admission came in the course of the motion, after the defendant had pleaded a limitations defence.   It could not resurrect the plaintiff’s right to its claim; otherwise, plaintiffs could resurrect statute-barred claims merely by asking the appropriate question of defendants on cross-examination (and receiving a truthful response). Actual waiver of the limitation period requires full knowledge of the legal rights a party holds, and an unequivocal intention to surrender those rights.

Update: the Court of Appeal upheld this decision.  Here are the key paragraphs:

[9]         Secondly, the appellant submits that the limitation defence should be unavailable because the respondent admitted his indebtedness in his cross-examination on his affidavit filed in the summary judgment proceedings.

[10]      We disagree.  Read in its totality, the admission of indebtedness by the respondent was qualified and stated to be subject to the limitation period defence.  In addition, under s. 13(9) of the Limitations Act, 2002, for an acknowledgement to reset the limitation clock, it must be made before the expiry of the limitation period applicable to the claim.  Here, the cross-examination occurred long after the expiry date.