Interpreting the Ontario Limitations Act – The Appropriateness of Bringing a Proceeding

FCL LLP Partner, Kim Duong, acting for the respondents, successfully appeared before the Ontario Court of Appeal in Dass v. Kay, 2021 ONCA 565, on issues involving the interpretation of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B. (“Limitations Act”).

The appellants raised two grounds of appeal alleging: (i) the motion judge erred in law by misrepresenting s. 5 of the Limitations Act, 2002, and (ii) the motion judge made palpable and overriding misapprehensions of fact. The arguments between the appellants and respondents centered on the new factor added to the analysis of the discoverability principle, s.5(1)(a)(iv) the appropriateness of a bringing a proceeding.

The appellants, in their arguments, proposed an expansion of the class of matters under s. 5(1)(a)(iv) to include any situation where plaintiffs know they have been wronged or suffered damage at the hands of the defendants, but doubt they will be able to marshal the evidence to prove the claim and are unsure whether the scale of the eventual commercial loss will make an action remunerative.
The case law has recognized two situations delaying the start of the limitation period: (i) where a plaintiff relied on a defendant’s superior knowledge and expertise, especially where the defendant took steps to ameliorate the loss; and (ii) where the parties have engaged an alternative dispute resolution process offering an adequate remedy and it has not been completed. However, the Court of Appeal held that in the case at hand, the appellants did not come within either situation.

The Court of Appeal was clear in stating that appellants were not restricted to the two categories of cases identified to date that delay the start of the limitation period. But if they cannot bring themselves within those two categories, they must propose another set of circumstances in which it could be said, on a principled basis, that a person with a claim could not have known that an action would be an appropriate means to remedy the injury, loss, or damage.

In agreeing with the respondents’ arguments, the Court of Appeal held that “the limitation period does not commence only when one can ascertain what damages would be entitled to as a remedy, such that one would be better able to assess whether litigation would be an attractive option.”