<\/p>\n
In Independence Plaza 1 Associates, L.L.C. v. Figlioni<\/em><\/a>, the Court of Appeal held that the basic two-year limitation period applies to a claim\u00a0on a foreign judgment in Ontario, and begins to run, at the earliest, when the time to appeal the judgment has expired or, if there is an appeal, the date of the appeal decision.\u00a0 Section 5 of the Limitations Act<\/a> can operate to delay discovery of the claim.<\/p>\n This is a terrific decision from Justice Strathy that settles one of the last unresolved limitations issues.\u00a0 I wrote about the issue in a now out-of-date section of the Law of Limitations<\/em>.\u00a0 Conflicting jurisprudence held that the basic limitation period applied (correctly, I suggested), and that as a proceeding to enforce an order no limitation period applied at all (utterly wrongly, I suggested, in more measured language).\u00a0\u00a0\u00a0\u00a0 \u00a0<\/em><\/p>\n Justice Strathy’s analysis turns on a close reading\u00a0of the Limitations Act. \u00a0His decision begins with the following: “The correct approach to resolving the two questions raised by this appeal begins and ends with the provisions of the Limitations Act, 2002, <\/em>which is a comprehensive and exhaustive scheme for dealing with limitation periods”.\u00a0 I would offer, gently, that the correct approach to a limitations question always begins and ends with the Limitations Act’s provisions, which courts rather often forget, but this mustn’t detract from the really excellent analyses.<\/p>\n The analyses begins where limitations analyses should\u2014with section 2, which describes the application of the Limitations Act:<\/p>\n [<\/a>31]\u00a0\u00a0 Because the proceeding on the New Jersey judgment brought by the respondent in this appeal is a \u201cclaim pursued in a court proceeding,\u201d it falls within the comprehensive and exhaustive scheme of the statute.<\/p><\/blockquote>\n Having found that the Limitations Act applies, Justice Strathy turned to the application of\u00a0s. 16(1)(b).<\/p>\n [<\/a>33]\u00a0\u00a0 I turn now to the first question raised in this appeal \u2013 whether there is any<\/span> limitation period applicable to a proceeding on a foreign judgment. Section 16(1)<\/a> of the Limitations Act, 2002<\/a><\/em>, which had no counterpart in the former statute, created a class of claims that are subject to no limitation period, rather than the \u201cbasic\u201d two-year limitation period or the \u201cultimate\u201d fifteen-year limitation period.<\/p>\n [<\/a>42]\u00a0\u00a0 It falls to this court, as a matter of first impression, to interpret whether s. 16(1)<\/a>(b) applies to a proceeding on a foreign judgment. The words of s. 16(1)<\/a>(b) are to be read in light of the language of the provision as a whole, their context within the statutory scheme, and the purposes of the Limitations Act, 2002<\/a>:<\/em> see R. v. Hajivasilis<\/em>, 2013 ONCA 27<\/span> (CanLII)<\/a>, 114 O.R. (3d) 337<\/span>, at para. 23<\/span>; and Ayr Farmers Mutual Insurance Co. v. Wright<\/em>, 2016 ONCA 789<\/span> (CanLII)<\/a>, at paras. 26<\/span>, 28-29, 31-32.<\/p>\n [<\/a>43]\u00a0\u00a0 First<\/span>, therefore, I consider the language of s. 16(1)<\/a>(b) as a whole.<\/p>\n [<\/a>44]\u00a0\u00a0 Phrases serving parallel functions and associated by the disjunction \u201cor\u201d in a statutory provision influence each other\u2019s meaning. The parallelism \u201cinvites the reader to look for a common feature among the terms\u201d to resolve any ambiguities: Ruth Sullivan, The Construction of Statutes<\/em>, 6th ed. (Markham: LexisNexis, 2014), at p. 230. The Supreme Court has stated that \u201ca term or an expression should not be interpreted without taking the surrounding terms into account\u201d in order to identify a \u201ccommon thread\u201d: Opitz v. Wrzesnewskyj<\/em>, 2012 SCC 55<\/span> (CanLII)<\/a>, [2012] 3 S.C.R. 76<\/span>, at paras. 40<\/span>, 43.<\/p>\n [<\/a>45]\u00a0\u00a0 In my view, the term \u201corder of a court\u201d in s. 16(1)<\/a>(b) takes its meaning, in part, from the parallel phrase immediately associated with it \u2013 namely, \u201cany other order that may be enforced<\/span> in the same way as an order of a court\u201d (emphasis added). I observe that a similar parallel phrase is found in s. 19(1)<\/a> of the Statutory Powers Procedure Act<\/em>, R.S.O. 1990, c. S.22<\/a>, which provides that \u201c[a] certified copy of a tribunal\u2019s decision or order in a proceeding may be filed in the Superior Court of Justice by the tribunal or by a party and on filing shall be deemed to be an order of that court and is enforceable<\/span> as such\u201d (emphasis added).<\/p>\n [<\/a>46]\u00a0\u00a0 The \u201ccommon feature\u201d or \u201ccommon thread\u201d linking these parallelisms is the concept of enforceability. Section 16(1)<\/a>(b) of theLimitations Act, 2002<\/a><\/em> applies to court orders and to other orders, such as those of persons exercising a statutory power of decision, that are enforceable in the same way as a court order.<\/p>\n [<\/a>47]\u00a0\u00a0 This common thread within s. 16(1)<\/a>(b) does not extend to foreign judgments. The domestic judgments contemplated by the provision are directly enforceable in Ontario by means of the execution procedures in r. 60<\/a> of the Rules of Civil Procedure<\/a><\/em>, including writs of seizure and sale, garnishment, or the appointment of a receiver: Lax<\/em>, at para. 21. By contrast, like an order of a foreign arbitral tribunal, the debt obligation created by a foreign judgment cannot be directly enforced in Ontario in the absence of reciprocal enforcement legislation such as REJA<\/a> or REJUKA. A proceeding in Ontario must be brought first: see Lax <\/em>at paras. 11-13; Yugraneft <\/em>at para. 45; Chevron Corp. v. Yaiguaje<\/em>, 2015 SCC 42<\/span> (CanLII)<\/a>, [2015] 3 S.C.R. 69<\/span>, at para. 43<\/span>. That proceeding may result in a judgment or order of the Ontario court. The resulting order may be enforced as an order of the court, with no applicable limitation period.<\/p>\n [<\/a>48]\u00a0\u00a0 Thus, the judgment of a foreign court is one step removed from being an order of a court for the purpose of s. 16(1)<\/a>(b) of theLimitations Act, 2002<\/a><\/em>. It is not on the same level as an order of an Ontario court or any other order, such as an order of an Ontario statutory decision maker, which may be enforced as an order of a domestic court. This was adverted to by Feldman J.A. in Lax<\/em>, at para. 31, in explaining why she did not agree with the approach taken by Cumming J. in Girsberger<\/em>:<\/p>\n [A]s long as only domestic judgments can be enforced by execution and the other methods discussed above, and therefore foreign judgments must be transformed into domestic judgments or registered before they are enforceable as domestic judgments, there is not parity of treatment.<\/p>\n [<\/a>49]\u00a0\u00a0 There are good reasons for giving different treatment for limitations purposes to the enforcement in Ontario of a judgment of an Ontario court, on the one hand, and a judgment of a foreign court, on the other hand. The principle of territorial sovereignty means that the judgment of a court has effect only inside the territory in which the court is located and cannot be enforced outside its borders: Stephen G.A. Pitel & Nicholas S. Rafferty, Conflict of Laws<\/em>, 2d ed. (Toronto: Irwin Law, 2016), at p. 162. The extraterritorial enforcement of a court\u2019s order is not a legitimate exercise of state power: see Tolofson v. Jensen<\/em>, 1994 CanLII 44 (SCC)<\/a>, [1994] 3 S.C.R. 1022<\/span>, at p. 1052<\/span>; Club Resorts Ltd. v. Van Breda<\/em>, 2012 SCC 17<\/span> (CanLII)<\/a>, [2012] 1 S.C.R. 572<\/span>, at para. 31<\/span>;Chevron<\/em>, at paras. 47-48; and Endean v. British Columbia<\/em>, 2016 SCC 42<\/span> (CanLII)<\/a>, 401 D.L.R. (4th) 577<\/span>, at para. 45<\/span>.<\/p>\n [<\/a>50]\u00a0\u00a0 Thus, while a domestic judgment can be enforced as of right in Ontario, it is necessary to bring a proceeding on a foreign judgment. If that proceeding is successful, it will give rise to an Ontario judgment which can be directly enforced in the province.<\/p>\n [<\/a>51]\u00a0\u00a0 \u00a0Furthermore, a judgment creditor who brings an Ontario proceeding on a foreign judgment must show that the foreign court had jurisdiction and that the judgment is final and for the payment of money (or that it would be appropriate for the Ontario court to recognize it as enforceable within the province even if it is interlocutory or non-monetary): see Pro Swing<\/em>; Chevron<\/em>; and Cavell Insurance Co. (Re)<\/em> (2006), 2006 CanLII 16529 (ON CA)<\/a>, 80 O.R. (3d) 500 (C.A.)<\/span>, at para. 41<\/span>.<\/p>\n [<\/a>52]\u00a0\u00a0 The foreign judgment debtor is entitled to raise defences to the proceeding, such as fraud, denial of natural justice and public policy: see Beals<\/em>. These defences \u201cdistinguish foreign judgments from local judgments, against which the sole recourse is an appeal\u201d: Janet Walker & Jean-Gabriel Castel, Canadian Conflict of Laws<\/em>, loose-leaf (Rel. 54-3\/2016 Pub.5911), 6th ed. (Toronto: LexisNexis, 2005), at para. 14.3.<\/p>\n [<\/a>53]\u00a0\u00a0 I conclude that the language of s. 16(1)<\/a>(b) of the Limitations Act, 2002<\/a><\/em> suggests that the term \u201corder of a court\u201d refers to an order of a domestic court.<\/p>\n [<\/a>54]\u00a0\u00a0 Second<\/span>, I consider the statutory context of s. 16(1)<\/a>(b) of the Limitations Act, 2002<\/a><\/em>.<\/p>\n [<\/a>55]\u00a0\u00a0 Section 16(1)<\/a>(b) also takes its meaning from the surrounding provisions of s. 16. When statutory provisions are grouped together, the legislature is presumed to have drafted each with the others in mind: Inland Revenue Commissioners v.\u00a0Hinchy<\/em>,[1960] A.C. 748 (H.L.)<\/span>, at p. 766<\/span>. They tend to illuminate each other\u2019s meaning because they \u201cshare a single idea\u201d: Ruth Sullivan,Statutory Interpretation<\/em>, 3d ed. (Toronto, Irwin Law, 2016), at p. 175.<\/p>\n [<\/a>56]\u00a0\u00a0 The other provisions grouped together in s. 16 pertain to claims such as family law support awards, sexual assault claims and government claims that are considered so important that, for one policy reason or another, they should have no limitation period at all. For example, the policy reason underlying the exemption for sexual assault claims \u201cis grounded in the likelihood that the dynamic of the relationship will impede the autonomy of the victim\u201d: Boyce v. Toronto (City) Police Services Board<\/em>, 2011 ONSC 53<\/span>(CanLII)<\/a>, at para. 40<\/span>, aff\u2019d, 2012 ONCA 230 (CanLII)<\/span><\/a><\/span>.<\/p>\n [<\/a>57]\u00a0\u00a0 In this context, it is important to identify the policy reason for including claims \u201cto enforce an order of a court\u201d in the subset of claims that have no limitation period under s. 16. In my view, the reason is that such claims have already passed a limitations hurdle under Ontario law \u2013 a court order can only be obtained if the underlying cause of action giving rise to it was not time-barred.<\/p>\n [<\/a>58]\u00a0\u00a0 This was the policy reason suggested by the British Columbia Law Reform Commission, in its 1974 Report on Limitations<\/em>, for the argument that no limitation period should apply to claims to enforce domestic court orders. As quoted by Newbury J.A. inYoung v. Verigin<\/em>, at para. 7, the commission wrote:<\/p>\n Furthermore, the successful plaintiff cannot be said to have slept on his rights. He has taken action, and as a consequence recovered judgment. It might be argued, with considerable justification, that no limitation period whatsoever should exist with respect to the enforcement of judgments. It may seem unfair that the plaintiff who has been put to the trouble and expense of obtaining a judgment to enforce a right or obligation should face a further limitation period with respect to the exercise of his rights under the judgment. Why should he not be free to pursue his rights under the judgment at his leisure if he so chooses?<\/p>\n [<\/a>59]\u00a0\u00a0 It follows that the term \u201corder of a court\u201d in s. 16(1)<\/a>(b) should be interpreted as referring to an order of a domestic court only. A proceeding on a foreign judgment has not passed any Ontario limitations hurdle. If the action on the foreign judgment is successful, it results in an Ontario judgment, which is subject to no limitation period. But that can only be justified if the underlying cause of action based on the foreign judgment has already passed a limitations hurdle in Ontario.<\/p>\n [<\/a>60]\u00a0\u00a0 \u00a0\u00a0I find support for this conclusion in the Report of the<\/em> Ontario Law Reform Commission on the Limitation of Actions<\/em> (Toronto: Department of the Attorney General, 1969), at pp.50-51. The report stated, at p. 49, that there was good reason to apply the longer twenty-year limitation period in the former Limitations Act<\/em> to actions on domestic judgments because, in terms later adopted by the British Columbia report, \u201cthe successful plaintiff cannot be said to have slept on his rights. He has taken action and, as a consequence, recovered judgment.\u201d However, the report nevertheless recommended that foreign judgments should remain subject to the six-year limitation period governing debts in the former Limitations Act<\/em>, notwithstanding the artificiality of treating them as simple contract debts.<\/p>\n [<\/a>61]\u00a0\u00a0 It is also noteworthy that several provinces have subjected foreign judgment proceedings to a special limitation period that is distinct from the one that applies to proceedings on domestic judgments. British Columbia\u2019s Limitation Act<\/em> subjects \u201clocal\u201d judgment proceedings to a ten year limitation period in s. 7<\/a>, but it deals with \u201cextraprovincial judgments\u201d separately. Section 2(1)(l) of Manitoba\u2019s The Limitation of Actions Act<\/em>, C.C.S.M., c L150<\/a>, treats \u201cCanadian judgments\u201d differently from other judgments. Newfoundland sets a six-year limitation period on an action \u201cto enforce a foreign judgment\u201d and a ten-year period on actions to enforce a judgment of a court in the province: see Limitations Act<\/em>, S.N.L. 1995, c. L-16.1, s. 6(1)<\/a>(g). And Prince Edward Island\u2019sStatute of Limitations<\/em>, R.S.P.E.I. 1988, c. S-7, s. 2(1)<\/a>(f) distinguishes between \u201cextraprovincial judgments\u201d and other judgments.<\/p>\n [<\/a>62]\u00a0\u00a0 The statutory context therefore suggests that the language of s. 16(1)<\/a>(b) of the Limitations Act, 2002<\/a><\/em> is confined to orders of domestic courts.<\/p>\n [<\/a>63]\u00a0\u00a0 Third<\/span>, and finally, I consider s. 16(1)<\/a>(b) in light of the purposes of limitations statutes.<\/p>\n [<\/a>64]\u00a0\u00a0 It would be contrary to the purposes of limitations statutes to interpret s. 16(1)<\/a>(b) as exempting foreign judgments from any limitation period. If it were always possible to bring a proceeding on a foreign judgment in Ontario without time limitation, no matter when and where it was obtained, the debtor would be indefinitely exposed to the prospect of defending such proceedings in Ontario. As was pointed out in the Ontario Law Reform Commission\u2019s report at p. 50, problems associated with the preservation and reliability of evidence are especially pronounced for foreign judgment debtors. This militates in favour of having some limitation period apply to proceedings on foreign judgments. As well, exempting such proceedings from a limitation period would not encourage diligence or reasonable dispatch on the part of the foreign judgment creditor, who, unlike domestic judgment creditors, has not already surmounted an Ontario limitations hurdle.<\/p>\n [<\/a>66]\u00a0\u00a0 I conclude, therefore, that s. 16(1)<\/a>(b) of the Limitations Act, 2002<\/a><\/em> does not apply to proceedings on foreign judgments, and the applicable limitation period for the respondent\u2019s proceeding on the New Jersey judgment at issue in this appeal is the basic two-year period in s. 4<\/a>. The result is that time begins to run when the claim is \u201cdiscovered\u201d within the meaning of s. 5<\/a>. I turn to that question next.<\/p>\n<\/blockquote>\n Justice Strathy then considered when time begins to run on a claim\u00a0on a foreign judgment in Ontario:<\/p>\n [<\/a>70]\u00a0\u00a0 The test under the Limitations Act, 2002<\/a><\/em> is not whether the judgment is \u201cfinal\u201d; it is when the claim is discovered<\/span>, a fact that is ascertained through the application of s. 5(1)<\/a>, aided by the presumption in s. 5(2)<\/a>.<\/p>\n [<\/a>71]\u00a0\u00a0 I acknowledge the point made by Newbould J. in PT ATPK <\/em>that, in the context of s. 5(1)<\/a> of the Limitations Act, 2002<\/a><\/em>, a proceeding on a foreign judgment does not fall particularly neatly into the definition of \u201cclaim\u201d as \u201ca claim to remedy an injury, loss or damage that occurred as a result of an act or omission.\u201d However, the statute was meant to be comprehensive and exhaustive.Section 2(1)<\/a> provides that it applies to \u201cclaims pursued in court proceedings,\u201d and s. 4<\/a> provides that the basic two-year limitation period applies \u201cunless this Act provides otherwise.\u201d<\/p>\n [<\/a>72]\u00a0\u00a0 The words \u201cinjury, loss or damage\u201d in s. 5(1)<\/a> can reasonably refer to the debt obligation created by a foreign judgment and owed by the foreign judgment debtor to the creditor. The \u201cact or omission\u201d can reasonably refer to the debtor\u2019s failure to discharge the obligation once it became final.<\/em> Viewed in this light, s. 5(1)<\/a> can reasonably be viewed as applying to a proceeding on a foreign judgment.<\/p>\n [<\/a>74]\u00a0\u00a0 Section 5(1)<\/a> provides that a claim is discovered on the earlier of: (a) the day on which the claimant first knew, among other things, \u201cthat having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it\u201d; and (b) the day on which \u201ca reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a)\u201d. The test in s. 5(1)<\/a>(a) has been referred to as a \u201csubjective test\u201d because it looks to the claimant\u2019s actual knowledge, and the test in s.5(1)<\/a>(b) as a \u201cmodified objective\u201d test because it looks to what a reasonable person with the abilities and in the circumstances of the claimant ought to have known: see Ferrera v. Lorenzetti Wolfe Barristers and Solicitors<\/em>, 2012 ONCA 851<\/span> (CanLII)<\/a>, 113 O.R. (3d) 401<\/span>, at para. 70<\/span>; and Crombie Property Holdings Limited v. McColl-Frontenac Inc. (Texaco Canada Limited)<\/em>, 2017 ONCA 16<\/span> (CanLII)<\/a>, at para. 35<\/span>.<\/p>\n [<\/a>75]\u00a0\u00a0 In 407 ETR Concession Co. v. Day<\/em>, 2016 ONCA 709<\/span> (CanLII)<\/a>, at para. 48<\/span>, Laskin J.A. explained that \u201cone reason why the legislature added \u2018appropriate means\u2019 [in s. 5(1)<\/a>(a)] as an element of discoverability was to enable courts to function more efficiently by deterring needless litigation.\u201d \u201cAppropriate\u201d means \u201clegally appropriate.\u201d For example, a tactical choice to delay commencement of a proceeding to engage in settlement discussions after a loss, injury or damage is known does not make the proceeding inappropriate: Markel Insurance Co. of Canada v. ING Insurance Co. of Canada<\/em>, 2012 ONCA 218<\/span> (CanLII)<\/a>, 109 O.R. (3d) 652<\/span>, at para. 24<\/span>.<\/p>\n [<\/a>76]\u00a0\u00a0 Appropriateness must be assessed on the facts of each case, and case law applying s. 5(1)<\/a>(a)(iv) is of limited assistance:Brown v. Baum<\/em>, 2016 ONCA 325<\/span> (CanLII)<\/a>, 348 O.A.C. 251<\/span>, at para. 41<\/span>. However, it is noteworthy that courts have held that a proceeding is not legally appropriate until other mechanisms for resolving a dispute, such as a statutory remedial process, have been exhausted: see 407 ETR<\/em>, at para. 40; U-Pak Disposals (1989) Ltd. v. Durham (Regional Municipality)<\/em>, 2014 ONSC 1103<\/span>(CanLII)<\/a>, at paras. 22-25<\/span>; Kadiri v. Southlake Regional Health Centre<\/em>, 2015 ONSC 621<\/span> (CanLII)<\/a>, at paras. 52-57<\/span>, aff\u2019d, 2015 ONCA 847 (CanLII)<\/span><\/a><\/span>; and Mew, at pp. 95-96.<\/p>\n [<\/a>77]\u00a0\u00a0 In the usual case, it will not be legally appropriate to commence a legal proceeding on a foreign judgment in Ontario until the time to appeal the judgment in the foreign jurisdiction has expired or all appeal remedies have been exhausted. The foreign appeal process has the potential to resolve the dispute between the parties. If the judgment is overturned, the debt obligation underlying the judgment creditor\u2019s proceeding on the foreign judgment disappears.<\/p>\n [<\/a>79]\u00a0\u00a0 To regard a claim based on the foreign judgment as discoverable and appropriate only when all appeals have been exhausted is also consistent with the observations of Rothstein J. in Yugraneft<\/em>. He stated, at para. 57, that the limitation period to enforce a foreign arbitral judgment under Alberta\u2019s Limitations Act<\/em> starts to run when the time to appeal the judgment has expired or, where an appeal is taken, the date of the appeal decision.<\/p>\n [<\/a>79]\u00a0\u00a0 To regard a claim based on the foreign judgment as discoverable and appropriate only when all appeals have been exhausted is also consistent with the observations of Rothstein J. in Yugraneft<\/em>. He stated, at para. 57, that the limitation period to enforce a foreign arbitral judgment under Alberta\u2019s Limitations Act<\/em> starts to run when the time to appeal the judgment has expired or, where an appeal is taken, the date of the appeal decision.<\/p>\n [<\/a>80]\u00a0\u00a0 Finally, as the application judge noted, this approach avoids the risk of multiplicity of proceedings by not requiring the judgment creditor to commence a proceeding on a foreign judgment in Ontario before all proceedings in the foreign jurisdiction have run their course. It furthers the purpose of s. 5(1)<\/a>(a)(iv) of the Limitations Act, 2002<\/a><\/em> by deterring the unnecessary litigation that may result from commencing an Ontario proceeding on a foreign judgment that is subsequently overturned.<\/p>\n [<\/a>82]\u00a0\u00a0 In a particular case, a claim based on a foreign judgment may not be discovered under s. 5<\/a> of the Limitations Act, 2002<\/a><\/em> until such time as the judgment creditor knew or ought to have known that the judgment debtor had exigible assets in Ontario and could be served with process: see Yugraneft<\/em> at paras. 49. 58, 61. As s. 5(1)(b) makes clear, the discoverability assessment, including the appropriateness criterion, must take account of the factual context and the plaintiff\u2019s actual circumstances, and I reiterate that each case must be decided on its own facts: see 407 ETR<\/em>, at paras. 34, 45-46.<\/p>\n<\/blockquote>\n These are the other noteworthy aspects of the decision:<\/p>\n\n
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