Motor Vehical Accident

Ontario: the limitation of uninsured motorist proceedings

Sarokin v. Zhang has a comprehensive summary of the limitation of uninsured motorist proceedings. It’s a good resource if you practice in the area:

[28]              Section 265 (1) of the Insurance Act (Ontario) sets out the mandatory provisions for uninsured automobile coverage to be contained in all Ontario automobile insurance policies:

 265 (1) Every contract evidenced by a motor vehicle liability policy shall provide for payment of all sums that,

(a) a person insured under the contract is legally entitled to recover from the owner or driver of an uninsured automobile or unidentified automobile as damages for bodily injuries resulting from an accident involving an automobile;

(b) any person is legally entitled to recover from the owner or driver of an uninsured automobile or unidentified automobile as damages for bodily injury to or the death of a person insured under the contract resulting from an accident involving an automobile; and

(c) a person insured under the contract is legally entitled to recover from the identified owner or driver of an uninsured automobile as damages for accidental damage to the insured automobile or its contents, or to both the insured automobile and its contents, resulting from an accident involving an automobile,

subject to the terms, conditions, provisions, exclusions and limits as are prescribed by the regulations.

 [29]              Regulation 676 under the Insurance Act sets out the applicable terms, conditions, provisions, exclusions and limits to payments under an automobile insurance policy pursuant to s. 265(1) of the Insurance Act. Section 6 of Regulation 676 sets out the mandatory notice provisions for claims made under s. 265(1) of the Insurance Act:

 (1) A person entitled to make a claim in respect of the bodily injury or death of a person insured under the contract shall do so in accordance with this section.

(2) The claimant shall give the insurer written notice of the claim within thirty days after the accident or as soon as is practicable after that date.

(3) The claimant shall give the insurer, within ninety days after the accident or as soon as is practicable after that date, such proof as is reasonably possible in the circumstances of the accident, the resulting loss and the claim.

(4) The claimant shall provide the insurer upon request with a certificate of the medical or psychological advisor of the person insured under the contract stating the cause of the injury or death and, if applicable, the nature of the injury and the expected duration of any disability.

 [30]              The applicable limitation periods for claims under s. 265(1) are set out in section 8 of Regulation 676:

 (1) No person is entitled to bring an action to recover an amount provided for under the contract, as required by subsection 265 (1) of the Act, unless the requirements of this Schedule with respect to the claim have been complied with.

(2) An action or proceeding against an insurer in respect of loss or damage to the insured automobile or its contents shall be commenced within one year after the loss or damage occurs.

(3) An action or proceeding against an insurer in respect of bodily injury or death, or in respect of loss or damage to property other than the insured automobile or its contents, shall be commenced within two years after the cause of action arises.

 [31]              The leading case with respect the application of the Limitations Act to claims under OPCF 44R is Schmitz v. Lombard General Insurance Company of Canada, 2014 ONCA 86. Following its decision in Markel Insurance Co. of Canada v. ING Insurance Co. of Canada, 2012 ONCA 218, the Court of Appeal held that the limitation period for claims under OPCF 44R starts to run on the day after a demand for indemnity is made:

“[20] ….Once a legally valid claim for indemnification under the OPCF 44R is asserted, the underinsured coverage insurer is under a legal obligation to respond to it. To paraphrase and adapt Sharpe J.A.’s observations, at para. 27 of Markel, the claimant for indemnity under the OPCF 44R “suffers a loss from the moment [the insurer] can be said to have failed to satisfy its legal obligation [under the OPCF 44R]”. Thus, the claimant suffers a loss “caused by” the underinsured [page700] coverage insurer’s omission in failing to satisfy the claim for indemnity the day after the demand for indemnification is made.” (Schmitz at paras. 20 and 26)

[32]              Unlike the claim of an injured party against a tortfeasor, the cause of action for an insured’s claim against his or her own insurer for the insurer’s failure to indemnify pursuant to the unidentified motorist endorsement is for breach of contract which does not arise until the insurer breaches its insurance contract to indemnify by failing or refusing to pay the insured’s claim (Jones v. Doe et al, 2018 ONSC 4780 at paras. 25-26; Chahine v. Grybas, 2014 ONSC 4698 at paras. 34-35; Tucker v. Unknown Persons, 2015 NLCA 21 at paras. 38-39).

[33]              In Schmitz, the Court of Appeal rejected the insurer’s submission that the definition of discoverability in s. 17 of OPCF 44R applies, holding that both ss. 4-5 of the Limitations Act apply to determine the commencement of the limitation period for an OPCF 44R claim (Schmitz at para. 16). The Court of Appeal also held that insurers are not prejudiced as they could require that insureds provide timely notice pursuant to other provisions in OPCF 44R and other insurance contracts (Schmitz at para. 22). The Court of Appeal also rejected the insurer’s arguments that the limitation period should begin to run on the day a claimant accumulates a body of evidence that would permit it a reasonable chance of persuading a Judge that his or her claims will exceed the limits of their policy and that starting the limitation period when a demand for indemnification is made does not limit when the demand could or should be made such that an insured does not need to wait until the outcome of the trial is known (Schmitz at paras. 23-24).

[34]              Markel arose from a loss transfer claim made by one insurer against another seeking indemnification for statutory accident benefits paid to an insured. The Court of Appeal held that the earliest the limitation period can start to run is the date the first party insurer demands indemnification from the second party insurer (Markel at para. 36). However, the Court also held that a claim cannot be delayed for tactical or other reasons and must be commenced when it is “legally appropriate”:

“[34] This brings me to the question of when it would be “appropriate” to bring a proceeding within the meaning of s. 5(1)(a)(iv) of the Limitations Act. Here as well, I fully accept that parties should be discouraged from rushing to litigation or arbitration and encouraged to discuss and negotiate claims. In my view, when s. 5(1)(a)(iv) states that a claim is “discovered” only when “having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it”, the word “appropriate” must mean legally appropriate. To give “appropriate” an evaluative gloss, allowing a party to delay the commencement of proceedings for some tactical or other reason beyond two years from the date the claim is fully ripened and requiring the court to assess to tone and tenor of communications in search of a clear denial would, in my opinion, inject an unacceptable element of uncertainty into the law of limitation of actions.” (Markel at para. 34)

[35]              These issues were considered more recently by Justice LeMay in Howell v. Jatheeskumar, 2016 ONSC 1381, a case decided in the context of an OPCF 44R claim similar to the present case. In Howell, plaintiff’s counsel sent a third party notice letter to the defendant’s presumptive insurer 7.5 months after the accident. Plaintiff’s counsel did not follow up with the presumptive insurer for 2 years and 4 months. At that time, the presumptive insurer advised that it was not the defendant’s insurer. Five months later, the plaintiff brought a motion to add the plaintiff’s own automobile insurer, TD.

[36]              LeMay J. held that that there were 3 possible outcomes. The court could determine that: i.) there was insufficient due diligence on the part of the Plaintiff and no other reason to extend the time limits thereby defeating any claim the plaintiff may have to extend the time limits as a result of the principles of discoverability; ii.) there was a triable issue about the issues of discovery and whether the claim was timely as a result of the application of the discoverability principles which could include whether there was any other statute under which the limitations period could be extended; or iii.) on the materials filed there was clearly an issue of discoverability that made the claim timely (Howell at para. 35).

 [37]              LeMay J. concluded that it was clear from Schmitz and Markel that there were good arguments available to the plaintiff to defeat any limitations defence advanced by TD:

37  In this case, the Plaintiff has a reasonable argument that the claim against TD General Insurance was not discoverable until August of 2015. However, there may be issues relating to the Plaintiff’s due diligence that TD General Insurance may wish to raise. As a result, I am prepared to find that this claim falls at least into the second category, that there was a triable issue about discovery. As a result, the claim should be amended.

38  The Plaintiff is not required to plead any discoverability issues at this stage (see Collins v. Cortez, supra at paragraph 15). Instead, if TD General Insurance raises a Limitations Act issue in its defence, then the Plaintiff will be required to plead the relevant facts on discoverability in reply to TD’s defence. (Howell at paras. 37-38)

Ontario: the principles of mva “threshold” claims

Dimech v. Osman contains a useful summary of the limitation of claims for non-pecuniary losses arising from a motor vehicle accident:

[14]      Under s. 4(1) of the Limitations Act, 2002 a person loses the right to sue for a claim two years after she “discovers” the claim. Under s. 5(2) of the Limitations Act, 2002 a plaintiff injured in a car accident will be presumed to have discovered her claim on the day of the accident unless she proves that she did not discover the claim that day and that a reasonable person with her abilities and in her circumstances would not have discovered the claim until a later time.

[15]      While one might normally think that being injured in a car accident automatically gives one a claim or the right to sue, that is not necessarily the case. Under s.267.5(5) of the Insurance Act, RSO 1990, c I.8 a person injured in a car accident in Ontario can only sue for non-pecuniary losses if the accident caused her to suffer “permanent serious impairment of an important physical, mental or psychological function.” This is commonly referred to as the “threshold”. If a plaintiff cannot prove that her injuries meet the threshold, her claim for non-pecuniary loss will be dismissed.

[16]      While a plaintiff can sue for pecuniary loss without meeting the threshold, case law provides that for the limitation period to commence in Ontario in relation to a motor vehicle accident lawsuit in which both pecuniary

and non-pecuniary damages are claimed, the plaintiff must have known or ought reasonably to have known that she could likely meet the threshold so as to have the right to sue. In Ioannidis v. Hawkings 1998 CanLII 14822 (ON SC), Justice Langdon held that for the two-year limitation period to start running, there must be,

…a sufficient body of evidence available to be placed before a judge that, in counsel’s opinion, has a reasonable chance of persuading a judge, on the balance of probabilities that the injury qualifies.

[17]      The question of when the limitation period commences is a question of fact. See: Farhat v Monteanu, 2015 ONSC 2119 (CanLII), at para. 33. It requires a finding of a date when a plaintiff or her lawyer knew or ought reasonably to have known that she had a reasonable chance to prove that she suffered permanent serious impairment of an important physical, mental or psychological function as a result of the car accident.

The decision also provides an example of the consequences of failing to adduce the evidence material to the limitation of these claims:

[18]      There is no evidence from Mr. Bekiaris as to whether he, as the plaintiff’s counsel, had formed an opinion during the 37-day pre-limitation period window that the plaintiff had a reasonable chance of persuading a judge that his injuries would meet the threshold. I offered Mr. Bekiaris an opportunity to consider refraining for acting as counsel on this motion both due to this evidentiary issue and in consideration of the fact that if the defendants succeed in having this action dismissed, Mr. Bekiaris could possibly face a claim for having missed the limitation period. He determined to proceed as counsel.

 [22]      With no evidence from counsel, and no evidence of any contemporaneous prognosis from a doctor, I am left to try to determine by inference whether the plaintiff or his counsel ought reasonably to have known that his injuries reasonably could have met the threshold during the 37-day pre-limitation period window.

 [26]      The defendants argue that with the burden lying on the plaintiff to prove that he could not reasonably have discovered his claim in the 37-day pre-limitation period window, it was incumbent upon him to adduce evidence to show that he or his counsel acted with diligence by asking a doctor for a prognosis. The defendants argue that the plaintiff has failed to prove that he asked any doctor whether his injuries were likely to permanently seriously impair an important function right up to the time that the claim was issued. As such, he cannot meet his burden to show that he acted with diligence as required to rebut the presumption in s. 5(2) of the Limitations Act, 2002.

 [29]      Like the plaintiff, the defendants have adduced no evidence to establish that a reasonable person, in the first 37 days after this type of accident, suffering injuries like those of the plaintiff, would likely know that he or she is likely to meet the threshold. There is no expert prognosis. There is no evidence about whether in the 37-day pre-limitation period window the plaintiff’s counsel ought to have concluded that he had a sufficient body of evidence to provide a reasonable chance of persuading a judge that the plaintiff’s injuries will meet the threshold.

 [31]      In my view, the defendants have not met their evidentiary burden to allow me to fairly and justly adjudicate the limitation period issue summarily. While there may perhaps be cases where a plaintiff’s injuries are so severe that they can confidently be said to meet the threshold from day one, I cannot tell if this is such a case. The defendants have given me the plaintiff’s medical records. But I have nothing to allow me to draw an inference that the plaintiff or his lawyer ought to have concluded in the first 37 days after the accident that the injuries met or were likely to meet the threshold at some time in future.

 [32]      Similarly, while I was able to conclude at first instance in Yasmin that the plaintiff had not diligently pursued a claim on the facts, I have nothing to allow me to reach the same conclusion here and now. I do not know if a reasonable patient 37 days into treatment ought to have been asking his doctors for long term prognoses about serious impairment of important functions. Neither is there any evidence before me to let me weigh or conclude whether a reasonable personal injury lawyer ought to have been seeking reports from the doctors about threshold issues within the 37-day pre-limitation period window.

Ontario: limitations issues that shouldn’t need deciding

There is a category of limitations jurisprudence that decides issues which shouldn’t need deciding. Three decisions recently expanded it.

Having commenced a proceeding by notice of action within the limitation period, can a plaintiff add defendants to the proceeding outside the limitation period by naming them as defendant in the statement of claim? No, obviously, the court held in Bercovici v. Attorney General of Canada:

[13]           The plaintiff’s action was commenced by notice of action.  Under rules 14.03(1)(a) and (2), where a plaintiff commences an action by notice of action, the notice of action, and not the statement of claim, is the originating process.  Under rule 14.06(1), the originating process shall contain “a title of the proceeding setting out the names of all the parties”.  Therefore, where the originating process is a notice of action, it is the title of proceeding in the notice of action that identifies the parties to the action.

[14]           The plaintiff relies on rule 14.03(2), which provides that a notice of action contain “a short statement of the nature of the claim” [emphasis added] and rule 14.03(5), which provides that “in an action commenced by the issuing of a notice of action, the statement of claim may alter or extend the claim stated in the notice of action”.  The plaintiff argues that these two rules read together allow the plaintiff to add to the statement of claim both claims and parties not included in the notice of action.  Specifically, the plaintiff submits that where the notice of action referred to the conduct of “responsible officials”, it was open to her to name those officials as defendants in the statement of claim as an extension of the claim in the notice of action.

[15]           Rules 14.03(1) and (2) and 14.03(5) must be interpreted in the context of the rules as a whole, which include rule 5.04(2).

[16]           Rules 14.03(1) and 14.06(1) read together provide that the parties to an action, which include the defendants, be named in the originating process, which in this case was the notice of action.  Rule 5.04(2) provides the means by which parties may be added to an action: “[T]he court may by order add, delete or substitute a party . . .” [emphasis added].  However, there is no provision in rule 14.03 that allows parties to be added to a proceeding commenced by notice of action simply by including them in the statement of claim.  In the face of the specific provision in rule 5.04(2) requiring a court order to add parties, the fact that rule 14.03(5) allows a plaintiff who has issued a notice of action to “alter or extend the claim” when filing her statement of claim does not enable that plaintiff to add new defendants simply by including them in the statement of claim.

[17]           Rule 14.03(2) enables a plaintiff to comply with a limitation period by commencing an action by notice of action “where there is insufficient time to prepare a statement of claim”.  The notice of action is therefore intended to be a document that can be prepared and issued quickly before the limitation period expires.  However, in order to defeat the operation of the limitation period, the plaintiff must still name all defendants within the limitation period, subject to the considerations discussed below.

[18]           If a plaintiff wishes to add defendants to an action commenced by notice of action, she must, as concluded above, do so by way of a motion under rule 5.04(2).  The registrar was therefore correct in refusing to accept for filing the statement of claim naming five new defendants.

Can you object to a request for documents on the basis that they are dated prior to the limitation period? No. A thousand times no! The court in Nanton v. Julien had no trouble dismissing this bizarre argument:

The defendants object to a number of requests for documents on the basis of the Limitations Act.  Limitations apply to bar claims, not requests for documentary production.  So long as the claim is properly pleaded and has not been dismissed by reason of a limitations defence, the parties are obliged to produce relevant documents, even if those documents date back to a time beyond the limitations period.

Does the limitation period for a claim arising from an auto accident commence on the date of the accident if the plaintiff can’t reasonably know the identity of the auto’s owner at that time? Also no, as the court in Miano v. Campos  held (while sighing, I imagine):

[30]         The Defendant’s position that the limitation period for a claim for damages arising from an automobile accident commences to run on the date of the accident even if the plaintiff does not know and cannot reasonably discover the identity of the owner and operator of the automobile on the date of the accident is misguided. It ignores the plain language of s. 5(1)(a)(iii) and 5(1)(b) and renders those provisions meaningless.   Given these provisions, it is unnecessary to commence a claim against “Jane Doe” in order to “preserve” a limitation period, as the limitation period does not commence to run until the identity of the owner or operator, as the case may be, is known or ought to have been known.  Such an approach adds nothing of value, clutters the record and, if Jane Doe was later identified, would then necessitate an unnecessary step in this proceeding to remove Jane Doe as a defendant and add the identified defendant.

Ontario: the limitation of claims for unidentified motorist coverage

The decision in Sukhu v. Bascombe holds that the limitation period for a claim for the unidentified motorist coverage in OPCF 44R does not run until the responding insurer refuses to satisfy a demand to indemnify.

[17]      In Schmitz v. Lombard General Insurance Company of Canada, 2014 ONCA 88 (CanLII); leave to appeal refused, [2014] SCCA No. 143, the Court of Appeal was dealing with the question of when the limitation period began to run for an indemnity claim under the underinsured motorist coverage provided by OPCF 44R optional endorsement to the standard form automobile insurance policy in Ontario. The Court of Appeal applied the reasoning in Markel and concluded that the limitation period does not begin to run until a demand to indemnify has been made and the responding insurer has failed to satisfy the claim. See Schmitz at paragraphs 22 to 26.

[18]      The reasoning behind Markel and Schmitz was applied in the decision of Justice Lofchik in Chahine v. Grybas, 2014 ONSC 4698 (CanLII). Justice Lofchik was faced with a motion involving facts very similar to the facts before the court on this motion. The plaintiff was involved in an accident and sued the other driver. After the claim was issued, the defendant’s lawyer advised the plaintiff’s lawyer that there was an unidentified motorist involved who may have been responsible for the accident. The plaintiff later confirmed this by obtaining a complete copy of the police report.

[19]      The plaintiff then brought a motion to add his own insurer pursuant to the unidentified motorist coverage in OPCF 44R of his policy. Justice Lofchik considered the provisions of the Limitations Act and the decisions of the Court of Appeal in Markel and Schmitz. He concluded that the same reasoning applied to unidentified motorist coverage. The limitation period for unidentified motorist coverage does not begin to run until a demand to indemnify has been made and the responding insurer has failed to satisfy the claim. See Chahine at paragraphs 36 to 39.

[20]      The plaintiffs also rely on the decision of Justice Leitch in Platero v. Pollock, 2015 ONSC 2922 (CanLII) which followed the decision in Chahine and also relied on the analysis of the Court of Appeal in Markel and Schmitz. See Platero at paragraphs 33 to 35.

[21]      TTC Insurance relies primarily on four decisions of the Court of Appeal. Those decisions are July v. Neal, 1986 CanLII 149 (ON CA), [1986] OJ No. 1101 (CA); Johnson v. Wunderlich, 1986 CanLII 2618 (ON CA), [1986] OJ No. 1251 (CA); Hier v. Allstate Insurance Co. of Canada, 1988 CanLII 4741 (ON CA), [1988] OJ No. 657 (CA) and Chambo v. Musseau, 1993 CanLII 8680 (ON CA), [1993] OJ No. 2140 (CA). Those decisions stand for the proposition that the limitation period for a claim under the unidentified motorist coverage of a policy of insurance begins to run when a plaintiff knew or ought to have discovered the accident involved the negligence of an unidentified motorist. TTC Insurance argues that these cases are binding authority and have represented the law of Ontario for decades.

[22]      The difficulty I have with the argument of TTC Insurance is that all of the Court of Appeal cases it relies upon were decided prior to the enactment of the current Limitations Act. They were also obviously decided before the decisions of the Court of Appeal in Markel and Schmitz.

[23]      The decisions in Chahine and Platero considered specific provisions and language of the current Limitations Act within the context of the Markel and Schmitz decisions. Both judges came to the conclusion that the limitation period for unidentified motorist coverage indemnity claims does not begin to run until a demand to indemnify has been made and the responding insurer has failed to satisfy the claim. I am unable to distinguish those decisions from the case before the court on this motion. They appear to be binding on this court.

[24]      TTC Insurance cited the contrary decision of Justice Sosna in Wilkinson v. Braithwaite, 2011 ONSC 2356 (CanLII) which held that the limitation period began to run when the plaintiff knew or ought to have discovered that the accident involved the negligence of an unidentified motorist. Although that decision involved the application of the current Limitations Act, it was decided before the Court of Appeal made its decisions in Markel and Schmitz. For this reason, the decisions in Chahine and Platero are to be preferred.

[25]      TTC Insurance also relies on the decision of Master McAfee in Bhatt v. Doe, 2018 ONSC 950 (CanLII), 2018 ONSC 950 (Master) in which she applied the July decision. The decisions in Chahine and Platero are not mentioned by Master McAfee and nor are the Markel and Schmitz Court of Appeal rulings. I do not know whether those cases were considered by her. In any event, the decision of another master is of persuasive value only. I am not bound to follow it, especially in the face of contrary decisions of a judge.

[26]      Counsel for TTC Insurance also suggested that the Chahine and Platero decisions were simply incorrect. TTC Insurance submits that the judges hearing those motions did not have the benefit of the earlier Court of Appeal decisions cited by TTC Insurance on this motion. If they had those decisions, those cases might have been decided differently. That may or may not be the case. I do not know. However, it is not the role of this court to question those decisions or the basis on which they were decided. Justices Lofchik and Leitch decided precisely the same issue as the one before me, having regard to specific provisions of the current Limitations Act and within the context of Markel and Schmitz. Decisions of a judge are binding on a master. In my view, I am bound to follow the decisions of Justices Lofchik and Leitch.

The decision also underscores the futility of relying on s. 16(1)(a) to avoid a limitations defence.  This is not an especially clever argument, has been made many times, and I’m pretty sure never succesfully:

 [12]           I do not accept the plaintiffs’ first argument involving section 16 of the Limitations Act. Section 16(1)(a) states that there is no limitation period in respect of a proceeding for a declaration if no consequential relief is sought. This is not the situation on this motion. The proposed pleading states that TTC Insurance must pay Ms. Sukhu’s damages in the event they are found to have been caused by the negligence of the unidentified motorist. This is obviously consequential relief, namely the payment of damages. See Tapak v. Non-Marine Underwriters, Lloyd’s of London, 2018 ONCA 168 (CanLII) at paragraph 14. The Court of Appeal has also emphasized that declaratory relief must be read narrowly so that section 16(1)(a) is not used as a means to circumvent a limitation period. See Alguire v. Manufacturers Life Insurance Company (Manulife Financial), 2018 ONCA 202 (CanLII) at paragraph 28.

Ontario: in an MVA claim, obtaining an accident report isn’t necessarily sufficient due diligence

 

Obtaining a motor vehcile accident report is not in all circumstances sufficient due diligence in identifying a potential defendant.  In Harold v. Quigley, Justice Broad held that there was no evidence to suggest that the police officer who completed the MVAR had investigated whether the proposed defendant had maintained and kept the highway in repair as the plaintiff proposed to plead.  The plaintiff was not entitled to assume that the officer had done so.  These are the relevant paragraphs:

[17]         There is nothing in the motion material which would suggest that the plaintiff’s abilities and circumstances affected her ability to investigate and understand the facts upon which the claim might be based.

[18]         The affidavit of George B. Dietrich, the managing lawyer at the Dietrich Law Office, did not disclose any steps taken by the plaintiff or her lawyers to discover the identity of all responsible parties within the two-year limitation period following the accident other than to obtain the MVAR. The plaintiff argues that nothing further was required in the exercise of due diligence. Mr. Dietrich stated that his firm relied upon the MVAR which reported that the defendant Quigley hit an icy spot, left the road into the median and flipped over and that he was driving too fast for the conditions. No enquiries were initiated on behalf of the plaintiff respecting the nature and extent of the winter road maintenance carried out by the Crown and Carillion in the period leading up to the accident.

[19]         The plaintiff relies upon the Court of Appeal decision in Lingard v. Milne-McIssac (2015), 2015 ONCA 213 (CanLII), 125 O.R. (3d) 118 (C.A.) for the proposition that “reliance on the information contained in a motor vehicle accident report is reasonable and sufficient and constitutes due diligence.” She also points to the case of Todhunter v. Owles, 2015 ONSC 5656 (CanLII), 2015 ONSC 5656 (S.C.J.) in which Tausendfreund, J. referred to Linguard  and rejected the proposition that “each action arising out of an MVA in winter conditions would require the addition of municipalities as defendants to address the standard of care regarding winter maintenance.”

[20]         The Crown and Carillion argue that the plaintiff’s motion material does not contain evidence of any due diligence to displace the presumption in s. 5(2) of the Limitations Act, 2002. They say that certainty of a defendant’s responsibility for the act or omission that caused or contributed to the loss is not a requirement for discoverability, citing the case of Kowal v. Shyiak, 2012 ONCA 512 (CanLII), 2012 ONCA 512 (C.A.) at para. 18-19, and that neither is knowledge of the standard of care or whether conduct fell below it, citing Cassidy v. Belleville (Police Service), 2015 ONCA 794 (CanLII), 2015 ONCA 794 (C.A.) at para. 13.

[21]         In my view the Lingard and Todhunter decisions are not determinative of the question as to whether the plaintiff has provided a reasonable explanation as to why information was not obtainable with respect to the possible claims against the Crown and Carillion within the limitation period. The Court of Appeal in Pepper v. Zellers Inc.  2006 CanLII 42355 (ON CA), [2006] O.J. No. 5042 (C.A.) at para. 14 confirmed that a motion under rule 5.04(2) to add parties after the apparent expiration of a limitation period is discretionary and involves a fact-based inquiry. The court observed that, while the threshold of such a motion is low, the motion judge is entitled to consider the evidentiary record to determine whether there is a live issue of fact or credibility about the commencement date of the limitation period.

[22]          Lingard dealt with information set forth on a MVAR with respect to insurance coverage of the defendant driver, holding that it was reasonable for the plaintiff to assume that the police officer who completed the report asked the defendant for proof of insurance and that the plaintiff was justified in relying upon the motor vehicle accident report for that information.

[23]         In the present case, there is nothing to suggest that the police officer who completed the MVAR conducted an investigation into whether the Ministry of Transportation and its contractor had maintained and kept the highway in repair, nor that the plaintiff was entitled to assume that the police officer had done so. Although the MVAC identified that the road was icy, it did not comment on whether the icy condition was connected to a failure of the Ministry and its contractor to keep the highway in a reasonable state of repair.

[24]         Teusendfreund, J. in Todhunter was considering a motion for leave to appeal to the Divisional Court from a decision of Tranmer, J. to grant leave to the plaintiff to amend to add two municipalities as defendants. Tranmer, J. found that the plaintiff had demonstrated due diligence in determining the parties liable for the accident by obtaining the MVAR, by moving to discovery and in bringing the motion shortly thereafter. He found that the MVAR did not suggest negligence on the part of either municipality with regard to road maintenance and it was not until the defendant’s examination for discovery that any issue with respect to the existence of black ice was identified.

[25]         As indicated above, Teusendfreund, J. rejected the proposition that each action arising out of an MVA in winter conditions would require the addition of municipalities as defendants. However, he did not hold that plaintiffs should be relieved in all circumstances from any obligation to carry out due diligence on whether the relevant authority had failed to maintain and keep the subject highway or road in repair, particularly when she or he is in possession of information that such may be the case.

[26]         In the present case the MVAR noted that the road was icy. The plaintiff has led no evidence that, armed with this information, she took any steps to attempt to ascertain whether the icy condition may have been a result of a failure of the authority having responsibility to maintain and repair the highway to the requisite standard. As indicated by the Court of Appeal in Kowal at para. 18, certainty of a party’s responsibility for an act or omission that caused or contributed to the loss is not a requirement and that it is enough to have prima facie grounds to infer that the acts or omissions were caused or contributed to by the party or parties identified. In Cassidy, at para. 13, the Court of Appeal held that discovery of sufficient material facts to trigger the commencement of a limitation period does not depend on precise knowledge of the applicable standard of care and whether the party’s conduct fell below it.

[27]         In contrast the situation in Todhunter, the plaintiff in the present case had knowledge of the existence of an icy road surface which contributed to the accident.  In her application for statutory accident benefits dated February 27, 2014, the plaintiff described the mechanism of the accident as involving the vehicle hitting black ice on Highway 11. As indicated above, the MVAR, received by the plaintiff’s counsel on January 9, 2015, had noted the presence of black ice on the highway.

[28]         It is noteworthy that counsel for the plaintiff requested the consent of Crown and Carillion to the amendment to add them as defendants prior to receipt of any documentation or records from their counsel respecting maintenance of the highway during the relevant time period. No new facts were discovered by counsel for the plaintiff prior to making the determination to amend her pleading.

[29]         In Wong v Adler, 2004 CanLII 8228 (ON SC), [2004] O.J. No. 1575 (Master) aff’d 2004 CanLII 73251 (ON SCDC), [2005] O.J. No. 1400 (Div. Ct.) Master Dash stated, at para. 45, that if the court determines that there is an issue of fact or credibility on a discoverability allegation the defendant should be added with leave to plead a limitations defence, whereas, if there is no such issue, the motion should be refused. In my view there is no issue of credibility on the question of whether simply obtaining the MVAR constituted sufficient due diligence on the part of the plaintiff in the circumstances. The court on this motion is in as good a position to determine that issue as would a judge on a summary judgment motion or at trial.

[30]         In my view the plaintiff has failed to discharge the onus on her show, by evidence, that discoverability delayed the commencement of the running of the limitation period. Her motion to amend the Statement of Claim to add the Crown and Carillion as defendants must therefore be dismissed.

 

Ontario: MVA litigation, lawyer’s letters, and the threshold

A lawyer’s letter stating that her plaintiff client has sustained permanent injuries is not, in the context of motor vehicle accident litigation, determinative of whether the plaintiff has discovered her claim within the meaning of the Limitations Act.

The plaintiff in Schaefer v. Ayeneababa suffered injuries in a motor vehicle accident.  The defendant moved for summary judgment dismissing the action as statute-barred by an expired limitation period.

The limitation period for a claim of permanent injury and impairment under section 276.5(5) of the Insurance Act doesn’t run until there’s a sufficient body evidence:

[4]              Both sides agree, as do I, that the limitations issue that is before me can be summarily adjudicated. Both sides also agree with the proposition set out in Ioannidis[2] – that in claims of permanent injury and impairment under s. 267.5(5) of the Insurance Act,[3] the court should grant “a degree of latitude to the plaintiff before declaring that the limitation period has begun to run.” A limitation period should not begin to run with regard to a serious and permanent impairment claim:

… until there is a sufficient body of evidence  available to be placed before a judge that, in counsel’s opinion, has a reasonable chance of persuading a judge on a balance of probabilities that the injury qualifies [as a serious permanent impairment].When such a body of material has been accumulated then and only then should the limitation begin to run.[4]

The defendant took the position that the plaintiff’s lawyer, by words and actions, “made clear to the insurer that the plaintiff’s injuries were permanent and that the limitation period would expire two years after the accident”.  The defendant relied on a letter from the lawyer to the insurer:

[11]         The defendant, however, points to a letter dated May 24, 2011 from the plaintiff’s lawyer to the insurer. The lawyer advises the insurer that as a result of the accident, the plaintiff suffered injuries to her neck, shoulders, back and hips and that the physical and psychological symptoms from these injuries (such as dizziness, headaches and acute depression) “are continuing up to the present.” The lawyer also notes that the limitation date is “fast approaching” and attaches a draft statement of claim. The draft statement of claim specifically pleads “permanent and serious impairments.” The lawyer then tries to file the claim by mail but the mailed-in claim is rejected by the court. The action is properly commenced on December 2, 2011.

The defendant argued that the letter was essentially an acknowledgement that the plaintiff’s injuries were permanent on the date of the accident.

Justice Belobaba correctly rejected this argument:

[12]         The defendant says that by these words and actions the plaintiff’s lawyer in essence acknowledged that his client’s injuries were indeed permanent and that he only had until June 24, 2011 (two years after the accident) to commence the action.

[13]         I do not agree. The fact that the plaintiff’s injuries were described as “continuing” is not, in and of itself, an acknowledgement of permanency. Nor is the fact that the lawyer attaches a draft statement of claim that pleads “permanent and serious impairments.” This claim is made in almost every motor vehicle accident that results in significant injury. And, in any event, pleadings are not evidence.

[14]          The fact that the lawyer noted in his letter that the two-year limitation period is “fast approaching” says as much about his desire to file the claim within the presumptive two-year period just to be on the safe side, as it does about an admission that his client knew she sustained permanent soft-tissue injuries at the date of the accident – which is generally an impossibility and is here rebutted by the medical documentation that the lawyer reviewed.

[15]         In his affidavit, the lawyer lists the various clinical and psychological reports that he had reviewed (none of which describe the impairments as permanent) and explains that when he sent the May 24, 2011 letter to the insurer, he “did not have the necessary medical reports and records to prove [that the impairments were permanent].” It was only after requesting a medical opinion from Dr. Sequeira on October 20, 2011 and receiving the doctor’s report a month later that he “formed the opinion that the plaintiff had sustained an injury that met the requirements of s. 267.5(5) of the Insurance Act.” The lawyer commenced the action less than a month later on December 2, 2011.

Ontario: interaction of the Insurance Act and Limitations Act

Justice Akhtar’s decision in Sorita v. TTC provides a helpful summary of the interaction between the Limitations Act and the statutory threshold in s. 267.5 of the Insurance Act:

[26]      As noted earlier, Ontario’s restriction on motor vehicle accident claims is contained in s. 267.5 of the Insurance Act, which provides:

(5) Despite any other Act and subject to subsection (6), the owner of an automobile, the occupants of an automobile and any person present at the incident are not liable in an action in Ontario for damages for non-pecuniary loss, including damages for non-pecuniary loss under clause 61(2)(e) of the Family Law Act, from bodily injury or death arising directly or indirectly from the use or operation of the automobile, unless as a result of the use or operation of the automobile the injured person has died or has sustained,

(a) permanent serious disfigurement; or

(b) permanent serious impairment of an important physical, mental or psychological function.

 [27]      Ontario’s no-fault insurance scheme means that, in the Insurance Act context, the limitation clock begins to run when the plaintiff becomes aware that their injuries constitute “permanent serious impairment”. To otherwise commence an action is futile, as no evidence would have been available of a qualifying injury: Peixeiro v. Haberman, 1997 CanLII 325 (SCC), [1997] 3 S.C.R. 549, at para. 32. Additionally, the plaintiff in a motor vehicle claim is not required to commence an action before they know that they have a “substantial chance” of success: Everding v. Skrijel, 2010 ONCA 437 (CanLII), 100 O.R. (3d) 641, at para. 11. The inquiry to be undertaken is “whether the prospective plaintiff knows enough facts on which to base an allegation of negligence against the defendant”: Lawless v. Anderson, 2011 ONCA 102 (CanLII), at para. 23.

Readers of Under The Limit will know not to rely on Lawless v. Anderson when considering the commencement of the limitation period.  Contrary to the above, the inquiry is not when the claimant knows enough facts on which to base an allegation of negligence, but when the claimant ought to have knowledge of the section 5 discovery criteria, including that a proceeding is an appropriate remedy.  It always bears repeating: the words “cause of action” do not appear in the Limitations Act.

Ontario: when it comes to a car accident, you can rely on the cops

In regards of discovering a claim for the purpose of the limitation period, a plaintiff can rely on the contents of a motor vehicle accident report prepared by the police at the scene of the accident.

In Lingard v. Milne-McIsaac, the plaintiff acted reasonably by relying on a statement in such a report that the defendant was insured.  It was reasonable for the plaintiff to assume that the police officer who completed the report asked the defendant for proof of insurance.  The Court of Appeal held that the plaintiff had no reason to treat insurance coverage as a live issue until he became aware that the defendant may not have coverage.

Ontario: Justice Perell on the interaction of the Insurance Act and the Limitations Act

In Farhat v. Monteanu, Justice Perell provides a typically thorough analysis of the interaction between the Insurance Act‘s section 267.5 threshold provisions and the limitation period.

The plaintiff sued for damages for his non-pecuniary injuries from a motor vehicle accident. The defendant pleaded a limitations defence and the plaintiff moved for partial summary judgment to defeat it.

The defendant ventured a novel defence. She argued that pursuant to section 5(2) of the Limitations Act, there is a presumption that a claimant discovers a motor vehicle accident claim when the accident occurs.  Because the plaintiff’s lawyer stated that the plaintiff’s injuries were serious in correspondence to the defendant eight days after the accident, this presumption was rebuttable only by the lawyer’s direct evidence that he delayed issuing the claim within two years of the accident because he wanted medical confirmation that the serious injury met the section 267.5  threshold.

No case law supported the defendant’s argument, and Justice Perell held that the jurisprudence “about the effect of the threshold on the running of limitation periods stands strongly against” it:

[27]           There is no onus on a plaintiff to prove or show: (a) that the limitation period was considered and a conscious decision made not to commence an action; (b) that a procedure was put in place to review the conscious decision at some reasonable point in the future; and (c) that a decision was made when additional information was obtained and counsel moved expeditiously.

[28]           Whether all this demonstration of what the lawyer must show “ought” to be the case is neither here nor there, because what “is” the case under the law about the running of limitation periods is that when an action is not commenced within two years after the accident the only onus on the plaintiff is to show that he or she could not have discovered the case during the period of delay before commencing the action […].

[29]           Mr. Farhat’s claim is apparently based on chronic pain becoming a permanent serious impairment of an important physical, mental or psychological function. Much to the dismay of insurance companies of defendants, almost invariably, it will take several months to determine whether ongoing pain suffered as a result of an accident is a permanent serious impairment. It will typically, almost invariably, be the case that a plaintiff with only a chronic pain claim will not know that the claim surpasses the Insurance Act threshold until sometime after the date of the accident.

[…]

[31]           Given the statutory presumption that a limitation period begins to run from the date of the accident, the onus is on the plaintiff to persuade the court that the seriousness of his or her injury was not discoverable within the applicable limitation period and the plaintiff must also persuade the court that he or she acted with due diligence to discover if there was a cause of action: Yelda v. Vu, 2013 ONSC 4973 (CanLII) at paras. 29-30.

[32]           In Everding v. Skrijel, 2010 ONCA 437 (CanLII), approving Vosin v. Hartin, [2000] O.T.C. 931 (S.C.J.), the Court of Appeal held that in applying the discoverability principle of the Limitations Act, 2002, the court should consider the threshold requirements of the Insurance Act, and the Court of Appeal held that a plaintiff will not have discovered his or her claim before he or she knows they have a substantial chance to succeed in recovering a judgment for damages. A person cannot be expected to commence an action before he or she knows that the necessary elements as set out in the legislation can be established on the evidence: Hoffman v. Jekel, 2011 ONSC 1324 (CanLII) at para. 9.

[33]           In Lawless v. Anderson, 2011 ONCA 102 (CanLII), the Ontario Court of Appeal stated at para. 23:

  1. Determining whether a person has discovered a claim is a fact-based analysis. The question to be posed is whether the prospective plaintiff knows enough facts on which to base an allegation of negligence against the defendant. If the plaintiff does, then the claim has been “discovered”, and the limitation period begins to run: see Soper v. Southcott (1998), 1998 CanLII 5359 (ON CA), 39 O.R. (3d) 737 (C.A.) and McSween v. Louis (2000), 2000 CanLII 5744 (ON CA), 132 O.A.C. 304 (C.A.).

[34]           When a limitation period defence is raised, the onus is on the plaintiff to show that its claim is not statute-barred and that it behaved as a reasonable person in the same or similar circumstances using reasonable diligence in discovering the facts relating to the limitation issue: Durham (Regional Municipality) v. Oshawa (City), 2012 ONSC 5803 (CanLII) at paras. 35-41; Bolton Oak Inc. v. McColl-Frontenac Inc., 2011 ONSC 6657 (CanLII) at paras. 12-14; Bhaduria v. Persaud (1985), 1998 CanLII 14846 (ON SC), 40 O.R. (3d) 140 (Gen. Div.). The limitation period runs from when the prospective plaintiff has, or ought to have had, knowledge of a potential claim and the question is whether the prospective plaintiff knows enough facts to base a cause of action against the defendant, and, if so, then the claim has been discovered and the limitation period begins to run: Lawless v. Anderson, supra at para. 23; Soper v. Southcott (1998), 1998 CanLII 5359 (ON CA), 39 O.R. (3d) 737 (C.A.); McSween v. Louis, 2000 CanLII 5744 (ON CA), [2000] O.J. No. 2076 (C.A.); Gaudet v. Levy (1984), 1984 CanLII 2047 (ON SC), 47 O.R. (2d) 577 at p. 582 (H.C.J.).

[35]           In some limitation period summary judgment motions, it may be necessary to demonstrate the time at which a plaintiff acting reasonably knew about his or her claim, but this motion is not one of those motions. For the purposes of the motions in the case at bar, for Mr. Farhat to rebut the presumption found in s. 5(2) of the Limitations Act, he need only show that he could not have discovered his chronic pain claim during the period between the date of the accident, May 18, 2006 and June 18, 2006 (two years before the date the action was commenced), which I am satisfied he has done.

[36]           Perhaps ironically, because s. 267.5 (5) of the Insurance Act was introduced to eliminate minor personal injury claims, its effect has also been to protect such claims from the running of a limitation period for a period of time commensurate with how long it would take a reasonable person with the abilities and in the circumstances of the plaintiff to have discovered that the threshold for a claim has been surpassed.

[37]           A simple comparison between Mr. Farhat’s automobile accident claim and a slip and fall case demonstrates why the operation of s. 267.5 on limitation periods rankles the insurance defence bar. Visualize, if Mr. Farhat had gotten out of his parked van and slipped and fell on a sidewalk in disrepair, there would be no waiting for a medical report and the limitation period for his occupier’s liability claim would immediately have commenced to run.

[38]           The law, however, for the discovery of slip and fall claims is not affected by s. 267.5 of the Insurance Act. Section 267.5, however, does influence the running of limitation periods for motor vehicle accident non-pecuniary claims.

[39]           No doubt much to the chagrin of the defence bar, s. 267.5 (5) of the Insurance Act introduces some slack into the apparent rigidity of the presumption found in s. 5(2) of the Limitations Act, 2002. A plaintiff, and in some instances his or her negligent lawyer, can take comfort from this slack because the limitation period only begins to run when a sufficient body of information is available to determine whether the plaintiff has a claim that may meet the threshold. In this regard, I adopt the observations of Justice Langdon in Ioannidis v. Hawkings (1998), 1998 CanLII 14822 (ON SC), 39 O.R. (3d) 427 at pp. 433-434 (Gen. Div.), where he stated:

… [N]o one can seriously argue that the decision whether a particular injury meets the statutory criteria is an easy one or, perhaps more important, that it will be easy to predict the outcome of a motion to dismiss a claim which the defendant asserts is unworthy. Even in such a motion, the onus is upon the plaintiff to demonstrate that his or her injuries meet the statutory criteria. When one is seeking to apply the discoverability rule to the plaintiff in a case such as this, it behooves the court to grant a degree of latitude to a plaintiff before declaring that the limitation period has begun to run. … In practical terms, the question is not whether the plaintiff believes that her injury meets the criteria but whether there is a sufficient body of evidence available to be placed before a judge that, in counsel’s opinion, has a reasonable chance of persuading a judge, on the balance of probabilities that the injury qualifies. When such a body of material has been accumulated, then and only then should the limitation begin to run. This is not to say that the plaintiff is entitled to wait until he or she has an overwhelming case. It is only to say that the court must afford a degree of latitude to a plaintiff in making this very individual and complicated determination.

I have one quibble with this otherwise excellent decision.  The statement in paragraph 34 that a plaintiff discovers her claim when she “knows enough facts to base a cause of action against the defendant” is incorrect. A plaintiff subjectively discovers her claim on the date she knows each of the facts listed in section 5(1)(a) of the Limitations Act, including that a proceeding is an appropriate remedy (which is not a fact that bases a cause of action).

For the same reason, while there is a presumption that the limitation period begins on the date of a slip and fall accident pursuant to section 5(2) of the Limitations Act, it doesn’t necessarily commence on that date. It may be that the plaintiff can only reasonably discover that the claim is the appropriate remedy on a later date, and because the section 5(1)(a) criteria are conjunctive, the limitation period will not commence until this later date.  It’s simply wrong to analyse the commencement of the limitation period based on the accrual of a cause of action. (Consider this a second salvo in my fight against on diminishing the impact of Lawless on limitations jurisprudence).