When is it appropriate to contemplate a legal proceeding?
It's an important consideration that should not be overlooked
when calculating the applicable limitation period. A recent
decision of the Ontario Court of Appeal helps to clarify this
Ontario's Limitations Act, 20021
establishes a two-year limitation period for most proceedings.
While missing a limitation period can be fatal to a claim, it's
not always clear when the clock begins to tick.
The period begins to run from the date that a claimant
"discovers" their claim, having knowledge that:
the injury, loss or damage had occurred,
it was caused, or contributed to, by an act or omission,
by a person against whom the claim is made, and
a proceeding would be a legally appropriate means to remedy
The Act presumes that a claimant has knowledge of these criteria
on the date the act or omission giving rise to the claim takes
place. However, the claimant can rebut the presumption, and delay
the start of the limitation period, by proving that they could not
have reasonably discovered the claim until some later date.
Clarke2 is noteworthy because it turns on
the fourth discovery criterion, the question of when a proceeding
becomes legally appropriate, which has received little judicial
The case centres on Andrew and Gavin Clarke, who suffered soft
tissue injuries in a car accident in April 2006. They retained a
lawyer, Faust, to represent them in an action for accident benefits
and tort damages. Faust issued a claim in June 2008, more
than two years after the accident.
Some weeks later, the Clarkes retained a new lawyer who assured
them that the claim was not necessarily out of time since discovery
may not have occurred until medical documents indicated that the
injuries met the threshold for a claim under the Insurance
Nonetheless, to be safe, the new lawyer wrote to Faust in July
2008, notifying him of the potentially missed limitation period.
Faust replied that, in his view, the claim was issued in time given
the Act's discovery provisions. The defendants were apparently
of the same view, at least at first, because they did not initially
plead a limitations defence.
However, the defendants soon amended their defence to assert
that the claim was out of time. This led the Clarkes to issue a
claim against Faust in December 2010, alleging professional
negligence. Faust moved for summary judgment dismissing the
negligence action on the basis that it had been issued more than
two years after the Clarkes' second lawyer had identified the
potential limitation problem in July 2008.
The motion judge agreed and dismissed the negligence action.
The Court of Appeal set aside the dismissal, noting that the
limitations clock only begins to run when a claimant, or a
reasonable person in the circumstances the claimant, has good
reason to believe that they have a claim for damages and commencing
a proceeding would be appropriate.
In this case, the determinative issue was when a proceeding
became an appropriate means to seek to remedy Faust's
potential negligence. The Court held that until the defendants in
the accident lawsuit raised a limitations defence, the Clarkes did
not have good reason to believe that they had a legal claim against
Faust. Until then, it was reasonable for the Clarkes' to have
accepted the advice of their lawyers that discoverability had
delayed the start of the limitation period and that the claim had
been issued in time.
However, once the defence was amended and it became clear that
Faust's potential negligence could result in a loss, it was
legally appropriate for the Clarkes to contemplate a proceeding and
the limitations clock began to tick.
Take away points
By its nature, the concept of discoverability creates some
uncertainty in calculating the limitation period. However,
Clarke is a reminder that discovery of a claim does not
occur until claimants are in a position to reasonably believe that
they have a legal claim for damages.
Often that will be when the claimant has knowledge satisfying
the first three discovery criteria. However, there are
circumstances, particularly in professional negligence claims,
where advice claimants receive will prevent them from believing
that they have a legal claim or where it is not clear that a
potentially negligent act will actually result in a loss. The
question of when it first became appropriate to contemplate a
proceeding is an important consideration that should not be
overlooked when calculating the applicable limitation period.
It's not often that our little blog intersects with such titanic struggles as the U.S. presidential race – and by using the term "titanic" I certainly don't mean to suggest that anything disastrous is in the future.
J.J. v. C.C., is an interesting case in which the court held that an automotive garage owes a duty to minor children to secure the vehicles on the premises by locking the cars and safely storing the car keys...
In Irwin v. Alberta Veterinary Medical Association, 2015 ABCA 396, the Alberta Court of Appeal found that the "ABVMA" failed to afford procedural fairness to a veterinarian undergoing an incapacity assessment.
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).