The moving municipality sought summary judgment dismissing an action as statute‑barred under the Limitations Act, 2002.
The dispute arose from a by‑law transferring responsibility for public transit assets and liabilities from lower‑tier municipalities to a regional municipality, including unresolved responsibility for unfunded employee liabilities.
The moving party argued the two‑year limitation period began when the by‑law took effect or when negotiations and an arbitration clause permitted referral to arbitration.
The court held that a permissive arbitration clause stating parties “may” proceed to arbitration does not trigger the limitation period.
The claim was discoverable only when municipal council formally passed a resolution denying responsibility and refusing arbitration, as municipal staff cannot bind the municipality without delegated authority.
