Considering litigation? If so, don't wait too long, because the clock is ticking, and you might run out of time sooner than you think.
Limitation Periods
All legal proceedings are subject to "limitation periods" – deadlines to sue. A claim must be filed before the limitation period has expired or it will be dismissed, regardless of the merits.
In general, there are two limitation periods that need to be considered.
1. Basic Limitation Period
The "basic" limitation period to start a court proceeding is two years from when a claim is "discovered".
In general, a claim is "discovered" on the first day that a person knows or ought to know that a potential defendant's act or omission contributed to loss or damage and that a court proceeding would be an appropriate remedy. In construction defect claims, it can be difficult to pinpoint the date on which the two-year limitation period started to run. The safest course of action in many instances is to sue promptly after a claim is discovered.
2. Ultimate Limitation Period
Regardless of when a claim is "discovered", a court proceeding in respect of the claim must also be filed before the expiry of the "ultimate" limitation period.
The current Limitation Act, which came into effect on June 1, 2013, shortened the "ultimate" limitation period to 15 years. Section 21(1) of the Act provides that "a court proceeding must not be commenced with respect to the claim more than 15 years after the day on which the act or omission on which the claim is based took place".
The 15-year ultimate limitation period starts to run on the later of:
- June 1, 2013, or
- the day the act or omission took place.
Deadline to File a Construction Defect Claim
Buildings that were designed and built before June 1, 2013 will be subject to the ultimate limitation period / deadline to sue of May 31, 2028, regardless of whether the two-year basic limitation has expired.
Some construction defects may be concealed and/or remain latent or hidden for many years. We therefore recommend that owners have their buildings or homes inspected by professional engineers or consultants and obtain legal advice in a timely manner, to reduce the risk of missing the basic or ultimate limitation periods.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
