Court File and Parties

CITATION: King Lofts Toronto I Ltd. v. P. Martin Emmons, 2013 ONSC 6949 DIVISIONAL COURT FILE NO.: 450/13 COURT FILE NO.: CV-11-417574 DATE: 20131108

SUPERIOR COURT OF JUSTICE – ONTARIO DIVISIONAL COURT

RE: KING LOFTS TORONTO I LTD. and KING LOFTS TORONTO II LTD., Plaintiffs/Respondents AND: P. MARTIN EMMONS, FRASER MILNER CASGRAIN LLP and CANADIAN TITLE INSURANCE COMPANY LTD., Defendants/Moving Parties

BEFORE: H. SACHS J.

COUNSEL: Melvyn L. Solmon & Matthew Valitutti, for the Plaintiffs/Respondents Anne E. Posno, for the Defendants, P. Martin Emmons and Fraser Milner Casgrain LLP

HEARD: November 7, 2013

ENDORSEMENT

[1] This is a motion by the Defendants for leave to appeal the dismissal of their summary judgment motion, which occurred on September 23, 2013. On the same date, Perell J. granted the Plaintiffs partial summary judgment. That decision is being appealed to the Court of Appeal. If leave is granted on this motion, the Defendants intend to bring a motion before the Court of Appeal to have the appeal of the dismissal heard in conjunction with the appeal of the judgment.

[2] The Defendants based their claim for summary judgment on a limitation period argument. As solicitors, they were being sued for negligence. The motion judge found that they were negligent because they did not warn the Plaintiffs that the City might insist on being paid for conveying lands that it owned and that this expense would not be covered by the title insurance.

[3] There is no issue that the Plaintiffs knew that the City was demanding payment for conveying the lands in question in April of 2008. However, they did not know that their title insurer would not cover the expense until January 8, 2009. The Plaintiffs commenced their claim against the Defendants on January 5, 2011. The motion judge found that the limitation period began to run from the date of denial of insurance coverage, not the date that the Plaintiffs knew that the City was demanding payment for conveying its lands.

[4] On the motion for leave to appeal, the Defendants submit that the motion judge’s decision in this regard is open to serious debate and is in conflict with existing caselaw. In particular, they argue that the motion judge’s ruling on this issue is inconsistent with the principle that discovery of a cause of action occurs when the plaintiff has notice of the harm that the defendant’s actions have caused, even when the extent of the harm is not known (see: 948298 Ontario Inc. v. Streit (Milton Mall) Ltd., [2012] O.N.S.C. 5537 at para. 21; Hamilton (City) v. Metcalfe & Mansfield Capital Corp.,[2012] OJ NO. 1099, 2012 ONCA 156, at para. 61).

[5] According to the Defendants, in this case, the Plaintiffs knew of the harm they were alleging the Defendants caused on the date that the City advised them that they were seeking payment for conveying the lands in question. That they knew they had suffered harm was confirmed when they filed their insurance claim. What they did not know was the extent of the harm.

[6] In my view, the issue raised on this appeal does raise questions about the application of the case law regarding limitation periods where insurance claims are made that it would be desirable for an appellate court to address. This issue is also very closely tied to the issues that the Court of Appeal will be dealing with on the appeal from the partial summary judgment that was granted.

[7] For these reasons, the motion for leave to appeal is granted. The costs of this motion are reserved to the court that hears the appeal.

SACHS J.

Date: 20131108