Canada: Cassels Brock Has Ontario Product Liability Action Dismissed Based On Application Of Georgia Limitations Statute

Cassels Brock's Product Liability group was recently successful in having a $1 million claim against Chrysler Group LLC ("Chrysler Group") entirely dismissed based on the application of a limitation period under the law of the state of Georgia, USA.

Background

The action, Gavin v. Chrysler Group LLC, arose from a motor vehicle accident which occurred in Whitesburg, Georgia in May of 2011. The plaintiff, an Ontario resident, was a passenger in a Jeep owned by the driver, a Georgia citizen. After resolving an action commenced in Georgia against the driver, the plaintiff commenced an Ontario action against Chrysler Group, alleging that the accident was caused by a defect in the vehicle.

Upon being served with the Statement of Claim, Chrysler Group immediately advised the plaintiff's counsel that the action was barred by Georgia law, namely The Official Code of Georgia, Title 51 Torts, Chapter 1, General Provisions, O.C.G.A.§ 51-1-11 (2012) (the "Georgia Statute of Repose"). Pursuant to the Georgia Statute of Repose, any action for negligent design and/or manufacture of products, including motor vehicles, which is commenced more than 10 years from the date of the first sale for use or consumption of the product at issue, is statute-barred. The only exceptions to the Georgia Statue of Repose are (a) actions arising from products which cause a disease or birth defect, and (b) actions arising from conduct which manifests a wilful, reckless or wanton disregard for life or property. The "wilful, reckless or wanton disregard" standard only applies where there is evidence of actual intent to cause harm or injury or conduct so reckless as to be equivalent to actual intent.

Conflict of Law Principles

Canadian courts have long followed the principle that the substantive law of the jurisdiction where the tort occurred shall apply. This principle has been routinely applied to dismiss product liability claims arising from motor vehicle accidents commenced after the expiration of the applicable limitation period in the jurisdiction where the accident occurred.

As the vehicle in question was purchased more than 10 years before the Ontario action was commenced, the Georgia Statute of Repose clearly operated to bar the plaintiff's claim. Despite numerous requests by Chrysler Group, the plaintiff failed to acknowledge or respond to this issue. As such, Chrysler Group brought a motion for summary judgment seeking to have the action dismissed. Chrysler Group's summary judgment record included evidence from a Georgia lawyer as well as the original Certificate of Title for the vehicle obtained from the Georgia Department of Revenue, which showed that the vehicle was purchased more than 10 years before the Ontario action was commenced. Prior to the return date for the summary judgment motion, the plaintiff consented to judgment, which was issued May 1, 2014, dismissing his claim and awarding Chrysler Group $12,000 for its costs of the action.

The Take-Away

This case provides an important lesson on the benefits of determining the applicable law early in a products case and assessing whether your client is entitled to rely on a favourable limitations statute in a foreign jurisdiction. Although the action may reside in Canada, your client may still benefit from a little southern hospitality.

Chrysler Group was represented by Glenn Zakaib and Chris Horkins of Cassels Brock's Product Liability group, with the assistance of Alicia Timm of the Atlanta office of Swift Currie McGhee and Hiers LLP.

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