Ontario: Laches can’t trump the Limitations Act

In Intact Insurance Company v. Lombard General Insurance, the Court of Appeal held that laches can’t defeat an otherwise timely claim.

The court reviewed the legislative history of the Limitations Act and concluded that the removal of the laches-saving provision was intentional, and the absence of this provision overrules any suggestion that laches might bar the commencement of a proceeding to pursue an unexpired legal claim.  The court’s review of the legislative history is the most thorough since its decision in York Condominium Corporation No. 382 v. Jay-M Holdings Limited, and will be helpful whenever a consideration of the act’s legislative history is appropriate.

The comprehensiveness of the limitations scheme also informed the court’s decision:

[54]      As I note above, the old Limitations Act applied only to a closed list of enumerated causes of action and not to civil actions in general. Equitable causes of action, with few exceptions, were outside of its scope. The Limitations Act, 2002 “represents a revised, comprehensive approach to the limitation of actions”: Joseph v. Paramount Canada’s Wonderland, 2008 ONCA 469 (CanLII), 90 O.R. (3d) 401, at para. 8. In Joseph, this court concluded that the common law doctrine of special circumstances had no application under the new, comprehensive Limitations Act, 2002. That doctrine had allowed a court to add or substitute a party or to add a cause of action after the expiry of a limitation period where special circumstances existed, unless the change would cause prejudice that could not be compensated for with either costs or an adjournment. Permitting a defendant to invoke the equitable doctrine of laches because a legal claim has an “equitable flavour” would be inconsistent with the comprehensive approach to the limitation of actions represented by the Limitations Act, 2002.

[55]      Permitting a defendant to rely on the defence of laches where the claim is a legal claim and subject to and within the basic limitation period prescribed under the Limitations Act, 2002 would also be counter to the purpose of that Act of promoting certainty and clarity in the law of limitation periods: msi Spergel Inc. v. I.F. Propco Holdings (Ontario) 36 Ltd., 2013 ONCA 550, 117 O.R. (3d) 81, at para. 61.

The court was explicit in limiting the scope of its decision:

[57]      I wish to make clear that this decision does not address the availability of equitable defences (such as waiver, estoppel and acquiescence) to the extent not founded solely on a plaintiff’s delay in initiating its claim. Nor do I suggest that delay in seeking equitable relief such as an injunction could not be a relevant factor in deciding whether such equitable relief should be granted. This decision considers whether a defendant seeking legal relief within the basic limitation period prescribed under the Limitations Act, 2002 can rely on the delay-based defence of laches.

This isn’t an especially surprising decision given the trend toward emphasising the comprehensive nature of the limitations regime.  The alternative would have been a reversion to a classification of actions approach to limitation periods, where ascertaining the applicable limitation period would require first classifying the claim as equitable or legal, and then determining whether the limitation period in equity is shorter than in law.

I also note the decision’s helpful summary of laches jurisprudence at paragraphs eight through twelve.

Ontario: the limitation of mortgage enforcement

Curiously, posts about the Real Property Limitations Act receive the most views on Under the Limit.  My guess is that this reflects the murkiness of the Act more than people’s interest in it.  The Act is Part I of the former Limitations Act, renamed, but otherwise unchanged from its antiquated and impermeable glory.  When the Ontario limitations regime was being reformed, a complete review of limitations was too time-consuming, and so review of the real property limitation periods was abandoned to avoid delaying the other reforms.  Should you be interested, the legislative history is detailed here at paragraphs 27-33.

In the spirit of catering to my market, I present the decision in 552439 Ontario Limited v. Forbes Building Material Limited for its summary of the section 23(1) limitation period for mortgage enforcement:

Real Property Limitations Act

−        Paragraph 23(1) of the Real Property Limitations Act provides for a ten-year limitation period for the enforcement of a mortgage.  It reads as follows:


23(1)  “4.  No action shall be brought to recover out of any land or rent any sum of money secured by any mortgage or lien, or otherwise charged upon or payable out of the land or rent, or to recover any legacy, whether it is or is not charged upon land, but within ten years next after a present right to receive it accrued to some person capable of giving a discharge for, or release of it, unless in the meantime some part of the principal money or some interest thereon has been paid, or some acknowledgment in writing of the right thereto signed by the person by whom it is payable, or the person’s agent, has been given to the person entitled thereto or that person’s agent, and in such case no action shall be brought but within ten years after the payment or acknowledgment, or the last of the payments or acknowledgments if more than one, was made or given.”

−        It is the nature of the mortgage which will determine when the ten-year period is triggered.  The limitation cannot pass before the mortgagee has any right to enforce.  The limitation runs from the earliest time at which repayment can be required.


−        While there are exceptions, on a demand mortgage, the cause of action accrues upon execution of the mortgage.


–  Mortgage Insurance Co. of Canada v. Grant 2009 ONCA 655 (CanLII), [2009] O.J. No. 3769

–  Alter v. Csontos [2004] O.J. No. 1590

–  Cioccio v. Cioccio [2005] O.J. No. 1182


−        If the terms of the mortgage provide for payment upon the happening of a specific contingency, then the cause of action arises upon the happening of the contingency.  Thus, the ten-year statutory limitation does not run until the contingency is satisfied.


–  Re Gould Ex Parte Garvey 1940 CanLII 89 (ON CA), [1940] O.R. 250 (Ont. C.A.)

–  Canada Mortgage and Housing Corp. v. 447136 British Columbia Ltd. [2014] B.C.J. No. 497