Limitation Periods: When is it Appropriate to Commence That Claim?

FCL LLP Partner, Kim Duong successfully argued a summary judgment motion involving issues of limitation and solicitor-client privilege.

In CFO Capital et al. ats Paul Dass et al., the plaintiffs sought damages for fraud, professional negligence and reputational injury alleged to have been caused by the defendants. In addition to the denial of any and all allegations of wrongdoing, the defendants asserted that the plaintiffs’ claim had breached the two year limitation period.

While the plaintiffs became aware of the material facts required to advance a claim, they waited over two and a half years before commencing the action. The plaintiffs argued that the evidence they had available at that time was insufficient to be successful in an action.  However, the Court in agreeing with the defendants, held that the absolute success of a claim, or the exact amount of damages claimed is not required to trigger the limitation period.

In doing so, the Court referred to the recent Court of Appeal decision, Sosnowski v. MacEwan, which set out three main principles in interpreting when it is “appropriate” to commence an action:

  1. To determine if an action is the appropriate means to seek to remedy
    a loss or damage depends on the specific factual and/or statutory
    setting of each case;
  2. Two circumstances have been accepted as delaying the date on
    which a claim is discovered under this subsection: when the plaintiff
    relies on the superior knowledge and expertise of the defendant, or
    where an alternative dispute resolution process offers an adequate
    remedy, and it is not complete; and
  3. The word “appropriate” means “legally appropriate”. In other words,
    “appropriate” does not include an evaluation of whether a civil
    proceeding will succeed.

Ultimately, the Court was satisfied that there was no genuine issue requiring a trial and granted summary judgment in favor of the defendants.

The plaintiffs have indicated they intend to appeal this decision. Stay tuned for the decision of the Court of Appeal on this matter.