Limitations motions

Ontario: can you assess intersection design? (the dangers of aggressive limitations defences)

Ontario courts are filled with pro forma and ill-conceived limitations defences.  Sometimes these stand out, particularly when advanced by institutions that maybe shouldn’t be too creative with limitations defences.  Take Sun v. Ferreira as an example.  The Plaintiffs claimed that the City of Toronto and the TTC are laible for the location of a bus stop and a cross-walk.  The TTC and the City of Toronto moved for judgment on a limitations defence that would have required the court to find that the plaintiffs, through their observations, ought to have known that an intersection was defectively designed.  It strikes me as rather fraught to suggest that a reasonable person with the abilities and in the circumstances of someone who knows nothing about standards of intersection design could assess whether one was designed competently.  The court agreed:

[45]           The Claims, in these proceedings against the moving parties are that there was an alleged design deficiency with respect to the TTC bus stop, and the adjoining crosswalks. Were the Moving Parties, by designing  an allegedly inherently dangerous situation, involving passengers, many of which would be children exiting a TTC bus, and crossing a busy highway to get to school, negligent as they did not take the appropriate care required in designing and constructing and whether the Moving Parties failed to warn of the hazard their design and construction created.  The main argument of the moving parties is that the responding parties were familiar with the accident location, the location of the TTC stop and location of the cross-walks adjacent to the School, and the absence of a traffic light or cross-walks.

[46]            The moving parties submit that the fact that the City or the TTC or both changed the configuration of the intersection following the accident “is not actionable”. The respondents, however, submit that the change raised the question of whether the change was made to remedy the negligent design of the accident location, and if so, whether the City and the TTC were aware of this negligent design, or ought to have been aware of this negligent design, prior to the accident. If they were aware of the negligent design, what steps, if any, did the Moving Parties take to rectify this deficiency before the accident occurred.  These will be the issues at trial.

[47]           The issue for this court is when did the Plaintiffs or Defendant know or ought to have known of the alleged deficient design, and the consequent failure to warn of the deficiency on the date of the accident.

[48]           Applying the analysis of the court in the cases of Shukster and Frederick, I find that there is a genuine issue requiring a trial on when the alleged deficiency with the intersection was known or ought to have been known by the responding parties. They knew of the accident location, but did they have the knowledge required to question if the intersection was defectively designed?  Further, when did they know that it was appropriate to take legal action against the moving parties?

[49]            The position of the Moving Parties is that the Respondents should have concluded that legal action would be appropriate to commence an action on the basis of their own observations and opinions of the alleged negligent design of municipal infrastructure or the configuration of the street and without the benefit of expert advice and the knowledge that the alleged design defect of the accident location had been corrected.  I do not agree that such is a reasonable conclusion for the court to reach.  In my view, such personal observations would not be sufficient for the Respondents to conclude that legal action would be appropriate, especially in light of the position taken by the City of Toronto that the intersection did not meet its criteria for the installation of a traffic light.

[50]           Rather, I am of the view that I can not make the findings that would be required to satisfy the test set out in Hryniak by our Supreme Court of Canada, namely, does the evidence allow me to fairly and justly adjudicate this dispute?

[51]           I find that following the guidance of our Courts, which I have referred to above, the respondents have established that there is a genuine issue requiring a trial on the discoverability of these causes of action, as it may not have been legally appropriate for the responding parties to commence litigation without any evidentiary basis, other than their own observations and opinions.  This issue requires a trial and for this reason, the motions must be dismissed

This decision is a reminder of the importance of considering the question asked by s. 5(1)(b) when advancing (and responding to) limitations defences.

Ontario: adding a plaintiff to a proceeding after the limitation period’s presumptive expiry

 

The Superior Court decision in Scalabrini v. Khan holds that the test for adding a plaintiff to a proceeding after the presumptive expiry of the limitation period is the same as adding a defendant:

[8]               The respondents argued that the test in Morrison is not applicable to a case such as this one where it is a plaintiff rather than defendant for whom leave is sought to be added. I see no basis for applying a different limitations test for leave to add a plaintiff than for leave to add a defendant. However, I do see a difference in the required findings and proof that would be needed to support a decision to deny leave to add a plaintiff (or defendant) on limitation grounds than would be needed to grant leave in the face of a limitations argument. If the master in this case had decided that Cinzia’s claims were statute barred and could not proceed, the Court of Appeal’s directive in Morrison that there be a finding that her claims had been discovered more than two years before the motion was brought makes sense because that decision would put an end to her claims.

Ontario: remember the amendment principles

Master Muir provides a helpful summary of amendment principles in Concord Adex Inc. v. 20/20 Management Limited:

[20]           The law in relation to motions seeking leave to amend a pleading is well settled and was not seriously in dispute on this motion. The applicable principles are summarized in my decision in Greenwald v. Ridgevale Inc., 2016 ONSC 3031 (CanLII), 2016 ONSC 3031 (Master). At paragraph 21 of Greenwald I set out those factors as follows:

• the amendments must not result in prejudice;

• the amendments must be legally tenable;

• the amendments must comply with the rules of pleading;

• a motion to add a party must meet all of the requirements of a motion under Rule 26.01;

• the addition of the party should relate to the same transaction or occurrence;

• the addition of the party should not unduly delay or complicate the hearing;

• the addition of a party will not be permitted if it is shown to be an abuse of process.

It is useful to keep these in mind when considering whether a motion to add a party of the presumptive expiry of the limitation period.

There is also a reminder that standard of discovery applicable when determining whether to add a proposed defendant after the presumptive expiry of the limitation period is reasonable discovery, not possible discovery:

[47]           With respect to all of these arguments it is important to emphasize that it is reasonable discoverability and not the mere possibility of discovery that triggers a limitation period. See Crombie Property Holdings Ltd. v. McColl-Frontenac Inc., 2017 ONCA 16 (CanLII) at paragraph 35; leave to appeal refused, 2017 SCCA No. 85. The proposed defendants appear to be holding the plaintiffs to a standard of perfection. That is simply not the test.

Ontario: r. 21 motions and limitation defences

Can you bring a r. 21 motion to strike a claim as statute-barred before delivering a statement of defence? Yes, the Divisional Court confirmed in Amrane v. York University, but only where it is plain and obvious that the plaintiff could assert no additional facts that would alter the limitations analysis:

[14]           I agree with the motion judge that the expiry of a limitation period is normally a defence that must be pleaded. However, as the Court of Appeal recognized in Beardsley v. Ontario, 2001 CarswellOnt. 4137 at para. 21, in those cases where it is plain and obvious from a review of the claim that no additional facts could be asserted that would alter the conclusion that a limitation period had expired, it would be unduly technical to require the delivery of a statement of defence.

See also this summary from Justice Stinson’s decision in Clark v. Ontario (Attorney General):

[12]        By way of response the plaintiffs argue that, save in exceptional cases (of which this is not one) courts do not entertain motions to decide limitation period issues prior to service of a statement of defence. In any event, they further contend, there are live factual issues that bear on the limitation issue, which are expressly raised in the statement of claim and preclude determination of the question on a pleadings-based motion such as this.

[13]        Strong authority for the former proposition can be found in Beardsley v. Ontario Provincial Police (2001), 2001 CanLII 8621 (ON CA),57 O.R. (3d) 1 (C.A.) where the Court of Appeal stated as follows (at paras 21 and 22):

[21]      The motion to strike based on the expiry of a limitation period could only be made pursuant to Rule 21.01(1)(a), which provides that a party may move for the determination of a question of law “raised by a pleading”. The expiry of a limitation period does not render a cause of action a nullity; rather, it is a defence and must be pleaded. Although we agree that it would be unduly technical to require delivery of a statement of defence in circumstances where it is plain and obvious from a review of a statement of claim that no additional facts could be asserted that would alter the conclusion that a limitation period had expired [for example expiry of the two-year limitation period under the Highway Traffic Act … in connection with a claim for property damage only, in circumstances where it is clear the discoverability rule does not apply] , a plain reading of the rule requires that the limitation period be pleaded in all other cases. See Pollakis v. Corner (1975), 1975 CanLII 597 (ON SC), 9 O.R. (2d) 691 (H.C.J.).

[22]           Plaintiffs would be deprived of the opportunity to place a complete factual context before the court if limitation defences were determined, on a routine basis, without being pleaded. Adherence to rules that ensure procedural fairness is an integral component of an appearance of justice. The appearance of justice takes on an even greater significance where claims are made against those who administer the law. …

[14]        More recently, Brown J. observed in Portuguese Canadian Credit Union Ltd. v CUMIS General Insurance (2010), 2010 ONSC 6107 (CanLII), 104 O.R. (3d) 16 (S.C.J.) as follows (at para. 33):

… I do not accept the submission of the Credit Union that its Rule 21 motion falls within the category of cases alluded to inBeardsley “where it is plain and obvious from a review of a statement of claim that no additional facts could be asserted”. InBeardsley the possibility of bringing a Rule 21.01(1)(a) motion before the close of pleadings was discussed in the context of a determination as to whether an action was statute-barred – for example, such as in cases where the injuries suffered in a car accident occurred on a date certain and nothing more could be said about that fact. That type of case is a far cry from the complex claim asserted in this proceeding. [Footnote omitted.]

[15]        In Canadian Real Estate Assn. v. American Home Assurance Co., 2015 ONCA 389 (CanLII) (at para. 2) the Court of Appeal again reminded us that “the exception in Beardsley … must be confined to cases that involve no legal or factual complexities.”

 

Ontario: Don’t bring limitations motions under r. 21.01(3)(d)

Does the expiry of the limitation period entitle a party to move under rule 21.01(3)(d) for an order staying or dismissing an action on the basis that the action is frivolous or vexations or an abuse of process?

Almost certainly not.  Evidence-based motions are the appropriate procedure for addressing a limitations defence, and these are brought pursuant to rule 20.

This is Justice Faieta’s review of the relevant jurisprudence in Kantor v. Fry:

[41]           However, the Defendant did not provide any case law precedent that support the use of Rule 21.01(3)(d) to stay or dismiss a claim on the basis of an expired limitation period.  While Rule 21.01(3)(d) was not specifically addressed, it is doubtful that such authority exists given that in Beardsley v. Ontario Provincial Police (2001), 2001 CanLII 8621 (ON CA),57 O.R. (3d) 1 (C.A.) the Ontario Court of Appeal  stated, at para. 21, that:

The motion to strike based on the expiry of a limitation period could only be made pursuant to Rule 21.01(1)(a), which provides that a party may move for the determination of a question of law “raised by a pleading”. [Emphasis added.]

[42]           In my view, where the determination of whether a claim is defeated by a limitation period turns on disputed facts, the better approach is a motion for a summary judgment using the tools that Rule 20.04 of the Rules of Civil Procedureprovides to resolve disputed facts.

[43]           In Boutin v. Co-operators Life Insurance Co. (1999), 1999 CanLII 2071 (ON CA), 42 O.R. (3d) 612 (C.A.), the Ontario Court of Appeal stated, at paras. 19-22:

To understand the scope of Rule 21, it is important to take into account the difference among Rules 20, 21 and 22, all of which seek to shorten or eliminate trials and thus reduce the cost of litigation. These rules are clearly related in their function, but they are not randomly interchangeable.

On a motion under Rule 20 the motions judge must determine that there is or is not a genuine issue for trial: see Irving Ungerman Ltd. v. Galanis (1991), 1991 CanLII 7275 (ON CA), 4 O.R. (3d) 545 (C.A.). That determination is based on the evidence filed on the motion. It is not based on the pleadings, apart from any admissions in the pleadings. Thus, a party responding to a summary judgment motion cannot sit back and rely on the pleadings. See 1061590 Ontario Ltd. v. Ontario Jockey Club (1995), 1995 CanLII 1686 (ON CA), 21 O.R. (3d) 547 (C.A.). Because of the provisions of Rule 20.04(4), if the only genuine issue for trial is a question of law, the motions judge may determine the question of law and grant judgment accordingly. Rule 20.04(4) provides that this will be done only where there are no facts in dispute which may give rise to a genuine issue for trial.

Motions under Rule 21 and 22 are different from summary judgment motions under Rule 20. Motions under Rules 21 and 22 focus on questions of law raised by the pleadings (Rule 21.01(1)(a)), or stated by agreement of the parties (Rule 22.01(1)). A Rule 22 motion brought by the agreement of the parties will, as a result of the provisions of Rule 22.04(a), be accompanied by an agreed statement of fact to the extent that facts are necessary “to enable the court to determine the question stated.” Rule 21.01(2) provides that there be no evidence on a motion under Rule 21.01(1)(a) “except with leave of a judge or on consent of the parties.” Since Rule 21.01(1)(a) requires that the question of law be raised by the pleadings there will generally be no need for evidence on a Rule 21.01(1)(a) motion. It seems clear to me that it was for this reason that the drafters of the Rules provided that there should be no evidence on a motion under Rule 21.01(1)(a), except for cases in which leave is granted or there is consent.

I do not think that the issue whether the policy limitation period is a bar to the appellant’s action is a question of law that should have been resolved on a Rule 21.01(1)(a) motion. As the motions judge’s endorsement indicates, the application of the limitation period in this case depends upon findings of fact for its resolution. This is also apparent from the appellant’s reply to the respondent’s statement of defence.  In my opinion, whether the respondent is entitled to rely on the limitation period in the policy has a significant factual component and is thus a matter which should be addressed at trial, not on a Rule 21.01(1)(a) motion. [emphasis added]

[44]           Finally, in Greatrek Trust S.A./Inc. v. Aurelian Resources Inc., [2009] O.J. No. 611, Justice D.M. Brown (as he then was) stated, at para. 19:

Further, an unhealthy devotion to Rule 21 motions exists at the present time in the Toronto Region. Too many parties regard Rule 21 motions as abbreviated surrogates for motions for summary judgment. Rule 21 motions are not even close cousins to motions for summary judgment. Summary judgment motions permit courts to review evidence in order to test the merits of a case – albeit a limited form of testing at present, but more robust testing will occur with the implementation of the improved Rule 20 on January 1, 2010: O. Reg 438/08. Rule 21 motions, by contrast, “focus on questions of law raised by the pleadings”: Boutin v. Co-operators Life Insurance Co. (1999), 1999 CanLII 2071 (ON CA), 42 O.R. (3d) 612 (C.A.), para. 21. As Osborne J.A. noted in Boutin, in most cases the application of a limitation period “depends upon findings of fact for its resolution”: para. 22. Evidence-based motions offer the more appropriate procedure by which to deal with the applicability of limitation defences. [Emphasis added.]