Many Canadian limitations statutes explicitly state that no
limitation period is applicable to a proceeding in which the
relief sought is a declaratory judgment. In an attempt to bring
themselves within this special rule, counsel facing an expired
limitation period have been known to frame their claims as ones
seeking declaratory relief.
At issue was a dispute regarding the ownership of a pipeline
system and related assets. Because the plaintiff had first sought,
unsuccessfully, to sue an alleged third-party fraudster in a
separate action, the claim against the defendant was not commenced
until well outside the standard two-year limitation period under
the Limitations Act, RSA 2000, c
The plaintiff sought to circumvent this obstacle by framing its
claim as one seeking two declaratory remedies – namely, a
declaration that the plaintiff was the rightful owner of the assets
and a declaration that the plaintiff was entitled to recover
immediate possession of the assets.
The Court of Appeal noted that — in determining whether a
particular claim was or was not subject to a limitation period
— the test was whether the requested relief was merely
"declaratory" or genuinely "remedial" in
nature. The Court accepted the following distinction between the
two forms of order: (i) a declaratory order stands on its own, and
provides the plaintiff with full satisfaction, even if the
defendant refuses to comply with the declaration; in contrast, (ii)
a remedial order will allow (and may require) the plaintiff to
return for further judicial assistance if the defendant does not
comply with the terms of the order. In the latter case, the claim
is subject to the standard two-year limitation period.
In concluding that the orders sought by the plaintiff were
properly characterized as remedial relief in the guise of
declaratory orders, the Court of Appeal provided the following
A claim for declaratory relief is an exception to the usual
remedial order sought in litigation. Indeed, the exception is as to
"a declaration of rights and duties, legal relations or
personal status,": [Limitations Act], section
1(i)(i). It is construed narrowly so as to discourage litigants
from claiming declaratory relief merely to avoid the limitation
period. The task of the court is to characterize the remedy
actually being sought. Here, the summary trial judge looked at the
pleadings. She noted the wording of the amended statement which
sought a declaration that the plaintiff was "entitled to
recover immediate possession of the pipeline assets." She
characterized the claim as one in which the appellant sought to
have possession of the Assets and that what the appellant was
really seeking was an order that would require the respondent to
transfer the Assets. In other words, she found that what the
appellant was seeking was more than a declaration pronouncing on
legal rights. It was seeking an order that would require coercive
action, i.e., the transfer of the Assets. She made no
error in her characterization of the remedy actually being
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