Stating the obvious

Ontario: some self-evident points on the timing of limitations defences

The Court of Appeal’s decision in Filice v. Complex Services Inc. is a reminder of certain commonsense, probably generally self-evident principles about the timing of limitations defences.  Raise a limitations defence in response to an amendment motion (if there is one to raise) on the motion, and when you raise a limitations defence generally, it shouldn’t for the first time on appeal:

[55]      There is no information in the record whether the issue of the limitations period was argued when the respondent sought leave to amend his statement of claim.  That is where it ought to have been argued but I have to assume it was not. If so, it is, in my view, again too late to raise the issue in this court.  However, even if it were open to the appellant to raise the issue now, I would not give effect to it.  The appellant was on notice of the respondent’s essential claim, that is, that his dismissal was improper.  Whether the claim is styled as wrongful dismissal or constructive dismissal, the appellant was fully aware of the nature of the claim it was facing within the two year limitation period.

Ontario: the Limitations Act doesn’t apply to claims before administrative tribunals

Mea Culpa! Given my take-away from this decision below, I clearly read it too quickly.  It is actually one of the more remarkably wrong limitations decisions from the past several years, not least because it holds that any personal injury claim involving a tenant and a landlord is not subject to the Limitations Act, but the one year temporal limit in the Residential Tenenacies Act.  It’s under appeal.  (What follows may be the only thing right about the decision).  

 

The Limitations Act plainly applies only to court proceedings and not claims brought before administrative tribunals.  Should you ever need an authority for this proposition (aside from the plain meaning of s. 2), look to Justice Sloan’s decision in Letestu v. Ritlyn Investments:

[62]        Section 2 of the Limitations Act makes it clear that the Limitations Act applies to “claims pursued in court proceedings”.

[63]        Nowhere in the Limitations Act does it state that the Limitations Act applies to claims brought before administrative tribunals.

Ontario: the limitation of claims for attorney compensation

In Armitage v. The Salvation Army, Justice Ray held (incorrectly) that the limitation period for claiming compensation as a property attorney commences on the death of the person who granted the power of attorney.

[10] The principal issue is the limitation period applicable to the applicant’s claim for attorney compensation. The applicant’s position is that any claim must be commenced within two years of the death of the individual who granted the power of attorney, unless otherwise waived by those who are interested parties. She contends that the Substitute Decisions Act creates the right to compensation, is silent on any limitation period, and uses the permissive “may” in reference to when the claim could be made. The respondent agrees that the right to compensation was created by the statute but that the language of the statute in using “may” gives the attorney an option to claim compensation “each year”, which if not taken up by the commencement of proceedings within the following two years is to be treated as abandoned. He argues that a claimant must commence proceedings every three years in order avoid the limitation period. In other words, one is to infer from the statute that the end of each year triggers the beginning of the two year limitation period.

Justice Ray disagreed.

[15] I do not take the language of the Act or of the continuing powers of attorney to require the attorney to take their compensation annually such that it should be taken to trigger a limitation period if the compensation is not taken. […] [The death of the person who granted the power of attorney] terminated the continuing power of attorney. I conclude that it is at that point that the limitation period commenced. It was the triggering event. The applicant had two years within his date of death to commence proceedings, if that was to become necessary, to make her claim for compensation as an attorney.

As my colleague Matthew Furrow obliged to me to recognise, this decision is wrong.  While there may be sound policy reasons for limiting a claim for attorney’s compensation after the death of the grantor, no limitation period applies to such an application.  The application is not a “claim” within the meaning of the Limitations Act because it doesn’t seek to remedy loss resulting from an act or omission.  If it’s not a “claim”, the basic and ultimate limitation periods can’t apply.  In fairness to Justice Ray, neither party raised this point.

Ontario: s. 36 of the BIA has no impact on the limitation period

Section 38 of the Bankruptcy and Insolvency Act permits a creditor to obtain the court’s authorisation to commence a proceeding in the creditor’s own name.  The need for the court’s authorisation doesn’t operate to extend the limitation period.

In King Insurance Finance (Wines) Inc. v. Byers, the court in a bankruptcy proceeding issued an order authorising the plaintiff to commence proceedings in its own name to recover assets the bankrupt may have transferred.  The plaintiff argued that the limitation applicable to this claim didn’t commence until the date of the order.

Justice Faieta correctly rejected the argument as baseless:

[34]           In my view, the need for approval under section 38 of the BIA does not operate to extend the limitation period under the LA, 2002.

[35]           There is nothing under the LA, 2002 or the BIA which supports the Plaintiff’s submission.

[36]           The interaction of the BIA and the LA, 2002 was resolved by the Ontario Court of Appeal in in Indcondo Building Corp.v Sloan, 2010 ONCA 890 (CanLII), 103 O.R. (3d) 445 where the Court found that a creditor commencing an action under section 38 of the BIA acquired no higher right than the Trustee.  The Court ruled, at paragraph 20, that:

The application of s. 12(1) [of the LA, 2002]  to a creditor claiming through the trustee will be to make effective the earlier discoverability date of either the assignor or the assignee, so that an assignment cannot have the effect of re-starting the running of a limitation period. Ordinarily, this would operate to the benefit of the defendant. If the creditor were aware of the underlying facts under s. 5(1)(a) of the LA, 2002 and failed to bring a proceeding within the limitation period, the creditor would be statute barred from taking advantage of enhanced recovery under a s. 38 order.

 

Ontario: SABS denied? Sue within the limitation period

The Court of Appeal decision in Blake v. Dominion of Canada General Insurance Company provides some useful obiter on the limitation of statutory accident benefit claims.

The submission of a new application for benefits by a claimant following a clear refusal by the insurer to pay benefits will not restart the limitation period. When an insurer denies statutory accident benefits, the remedy is to seek recourse within the limitation period, not to submit a further application.