Waschkowski v. Estate of Rosalie Hopkinson, Deceased [Indexed as: Waschkowski v. Hopkinson Estate]

47 O.R. (3d) 370

[2000] O.J. No. 470

No. C32484

Court of Appeal for Ontario

Abella, Charron and MacPherson JJ.A.

February 23, 2000

Limitations -- Tort -- Actions against estates -- Discoverability principle not applying to limitation period in s. 38(3) of Trustee Act -- Trustee Act, R.S.O. 1990, c. T.23.

More than five years after a motor vehicle accident, the plaintiff brought an action for damages for negligence. The alleged tortfeasor died in the accident and the action was commenced against her estate. The plaintiff claimed that she did not know until September 1996 that the accident resulted in injuries sufficiently serious to meet the threshold in s. 266(1) of the Insurance Act, R.S.O. 1990, c. I.8, and that the action was commenced within two years of that discovery. A motion was brought under rule 21.01(1)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 for a determination of the question of whether the plaintiff's claim was subject to the two-year limitation period in s. 38(3) of the Trustee Act and, if so, whether that limitation period is subject to the discoverability principle. The motions judge held that, while the claim was subject to the limitation period in s. 38(3) of the Trustee Act, that limitation period is subject to the discoverability rule. The estate appealed.

Held, the appeal should be allowed.

The discoverability rule does not apply to s. 38(3) of the Trustee Act. The limitation period in that section runs from the death of the alleged wrongdoer or the person wronged, not from the date when the damage was sustained or when the cause of action arose. Regardless of when the injuries occurred or matured into an actionable wrong, s. 38(3) of the Trustee Act prevents their transformation into a legal claim unless that claim is brought within two years of the death of the wrongdoer or the person wronged. The state of actual or attributed knowledge of the injured person is not germane.

APPEAL from a determination that the discoverability rule applies to s. 38(3) of Trustee Act, R.S.O. 1990, c. T.23.

Kamloops (City) v. Nielsen, 1984 CanLII 21 (SCC), [1984] 2 S.C.R. 2, 66 B.C.L.R. 273, 10 D.L.R. (4th) 641, 54 N.R. 1, [1984] 5 W.W.R. 1, 29 C.C.L.T. 97, 26 M.P.L.R. 81, 26 M.P.L.R. 81, consd Other cases referred to Corkhill Estate v. Ontario (Public Trustee) (1996), 1996 CanLII 8027 (ON SC), 30 O.R. (3d) 30, 15 E.T.R. (2d) 121 (Gen. Div.); Fehr v. Jacob (1993), 1993 CanLII 4407 (MB CA), 85 Man. R. (2d) 63, 41 W.A.C. 63, [1993] 5 W.W.R. 1, 14 C.C.L.T. (2d) 200, 14 C.P.C. (3d) 364 (C.A.), supp. reasons 1993 CanLII 14910 (MB CA), 88 Man. R. (2d) 10, 51 W.A.C. 10, 16 C.P.C. (3d) 382 (C.A.); Grenier v. Canadian General Insurance Co. (1999), 1999 CanLII 2156 (ON CA), 43 O.R. (3d) 715, 32 C.P.C. (4th) 267 (C.A.); Peixeiro v. Haberman, 1997 CanLII 325 (SCC), [1997] 3 S.C.R. 549, 151 D.L.R. (4th) 429, 217 N.R. 371, 30 M.V.R. (3d) 41, 12 C.P.C. (4th) 255 Statutes referred to Highway Traffic Act, R.S.O. 1990, c. H.8, s. 206(1) Insurance Act, R.S.O. 1990, c. I.8, s. 266(1) Trustee Act, R.S.O. 1990, c. T.23, s. 38 Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 21.01(1) (a)

J. Sebastian Winny, for appellant. Sandra L. Coleman, for respondent.

The judgment of the court was delivered by

[1] ABELLA J.A.: -- In Ontario, except in cases of libel and slander, a person wronged by someone who subsequently dies, can bring an action against the deceased person's executor or administrator. The action, however, must be brought no later than two years from the death of the alleged wrongdoer. The issue in this appeal is whether that two-year limitation can be extended if the injured person did not discover that there was a basis for an action until after the two years had elapsed.

[2] At common law, no action in negligence could be brought on behalf of or against someone who had died. This prohibition was lifted in most jurisdictions by statute. In Ontario, the legislative entitlement to maintain an action in tort by or against the estate of a deceased person is found in s. 38 of the Trustee Act, R.S.O. 1990, c. T.23, which states:

38(1) Except in cases of libel and slander, the executor or administrator of any deceased person may maintain an action for all torts or injuries to the person or to the property of the deceased in the same manner and with the same rights and remedies as the deceased would, if living, have been entitled to do, and the damages when recovered shall form part of the personal estate of the deceased but if death results from such injuries no damages shall be allowed for the death or for the loss of the expectation of life, but this proviso is not in derogation of any rights conferred by Part V of the Family Law Act.

(2) Except in cases of libel and slander, if a deceased person committed or is by law liable for a wrong to another in respect of his or her person or to another person's property, the person wronged may maintain an action against the executor or administrator of the person who committed or is by law liable for the wrong.

(3) An action under this section shall not be brought after the expiration of two years from the death of the deceased.

[3] In recent years, courts have followed the lead of the Supreme Court of Canada in Kamloops (City) v. Nielsen, 1984 CanLII 21 (SCC), [1984] 2 S.C.R. 2, 10 D.L.R. (4th) 641, by relieving injured persons from the strict application of limitation periods in cases where they did not know that a cause of action existed until after the expiration of the limitation period. In such cases, the limitation period was deemed to start running only after the plaintiff could be said reasonably to have known that the factual underpinning of a claim had crystallized. This was known as the discoverability rule.

[4] Until the later decision of the Supreme Court of Canada in Peixeiro v. Haberman, 1997 CanLII 325 (SCC), [1997] 3 S.C.R. 549, 151 D.L.R. (4th) 429, it was not clear whether the discoverability rule applied to all limitation provisions, or whether its application depended on the actual wording of the statutory limitation: see, for example, Corkhill Estate v. Ontario (Public Trustee) (1996), 1996 CanLII 8027 (ON SC), 30 O.R. (3d) 30, 15 E.T.R. (2d) 121 (Gen. Div.).

[5] At issue in Peixeiro was whether the limitation period in s. 206(1) of the Highway Traffic Act, R.S.O. 1990, c. H.8 was subject to the discoverability rule. This section states that:

206(1) . . . no proceeding shall be brought against a person for the recovery of damages occasioned by a motor vehicle after the expiration of two years from the time when the damages were sustained.

(Emphasis added)

[6] Major J. concluded that based on the language of this particular provision, the discoverability rule applied, but, citing Fehr v. Jacob (1993), 1993 CanLII 4407 (MB CA), 14 C.C.L.T. (2d) 200 at p. 206, [1993] 5 W.W.R. 1 (Man. C.A.), he adopted the following boundary line beyond which the discoverability rule could not extend:

. . . the judge-made discoverability rule is nothing more than a rule of construction. Whenever a statute requires an action to be commenced within a specified time from the happening of a specific event, the statutory language must be construed. When time runs from "the accrual of the cause of action" or from some other event which can be construed as occurring only when the injured party has knowledge of the injury sustained, the judge-made discoverability rule applies. But, when time runs from an event which clearly occurs without regard to the injured party's knowledge, the judge-made discoverability rule may not extend the period the legislature has prescribed.

(Emphasis added)

[7] The primary interpretative conclusion of Major J.'s analysis is that the application of the discoverability rule depends on the wording of the limitation provision. The ancillary conclusion is that the discoverability rule does not apply when, based on that wording, the limiting time runs from a fixed event unrelated to the injured party's knowledge or the basis of the cause of action: see Grenier v. Canadian General Insurance Co. (1999), 1999 CanLII 2156 (ON CA), 43 O.R. (3d) 715, 32 C.P.C. (4th) 267 (C.A.), per Morden A.C.J.O.).

[8] In s. 38(3) of the Trustee Act, the limitation period runs from a death. Unlike cases where the wording of the limitation period permits the time to run, for example, from "when the damage was sustained" (Peixeiro) or when the cause of action arose (Kamloops), there is no temporal elasticity possible when the pivotal event is the date of a death. Regardless of when the injuries occurred or matured into an actionable wrong, s. 38(3) of the Trustee Act prevents their transformation into a legal claim unless that claim is brought within two years of the death of the wrongdoer or the person wronged.

[9] The underlying policy considerations of this clear time limit are not difficult to understand. The draconian legal impact of the common law was that death terminated any possible redress for negligent conduct. On the other hand, there was a benefit to disposing of estate matters with finality. The legislative compromise in s. 38 of the Trustee Act was to open a two-year window, making access to a remedy available for a limited time without creating indefinite fiscal vulnerability for an estate.

[10] In the case before us, a motion was brought under rule 21.01(1)(a) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 for a determination before trial of a potentially determinative question of law. The question before the motions judge was whether the plaintiff's claim was subject to the limitation period created by s. 38(3) of the Trustee Act and, if the limitation period applied, whether this period was subject to the discoverability principle.

[11] The plaintiff's negligence action arose out of a motor vehicle accident which occurred on November 20, 1993. Rosalie Hopkinson, whose estate is the defendant in this action, died in the accident.

[12] The plaintiff, Coralie Waschkowski, commenced an action almost five years after the accident, on September 23, 1998. The plaintiff's position is that she did not know until September 24, 1996 that the accident resulted in injuries sufficiently serious to meet the threshold in s. 266(1) of the Insurance Act, R.S.O. 1990, c. I.8. This section states:

266(1) In respect of loss or damage arising directly or indirectly from the use or operation, after the 21st day of June, 1990, of an automobile and despite any other Act, none of the owner of an automobile, the occupant of an automobile or any person present at the incident are liable in an action in Ontario for loss or damage from bodily injury arising from such use or operation in Canada, the United States of America or any other jurisdiction designated in the No-Fault Benefits Schedule involving the automobile unless, as a result of such use or operation, the injured person has died or has sustained,

(a) permanent serious disfigurement; or

(b) permanent serious impairment of an important bodily function caused by continuing injury which is physical in nature.

[13] The parties acknowledged that based on Peixeiro, the two-year limitation period in s. 206(1) of the Highway Traffic Act is subject to the discoverability rule. Since Ms. Waschkowski brought her claim within two years of discovering that her injuries met the threshold in s. 266(1) of the Insurance Act, there was agreement that the plaintiff's claim is not defeated by the two-year limitation period in s. 206(1) of the Highway Traffic Act.

[14] The issue before the motions judge was whether the principle of discoverability also applied to save the plaintiff's claim from the two-year limitation period set out in s. 38(3) of the Trustee Act.

[15] The motions judge held that although the plaintiff's claim was subject to the limitation period created by s. 38(3) of the Trustee Act, that limitation period was subject to the discoverability rule. The estate of Rosalie Hopkinson appealed from the determination that the discoverability rule applied to s. 38(3) of the Trustee Act. The plaintiff, Ms. Waschkowski cross-appealed the order of costs made against her because of her delay in "initiating proceedings".

[16] As indicated earlier in these reasons, based on the language of the limitation provision, the discoverability principle does not apply to s. 38(3) of the Trustee Act. The effect of s. 38(3) is, in my view, that the state of actual or attributed knowledge of an injured person in a tort claim is not germane when a death has occurred. The only applicable limitation period is the two-year period found in s. 38(3) of the Trustee Act.

[17] The appeal is allowed with costs throughout. In the circumstances, leave to cross-appeal is granted but the cross- appeal is dismissed.

Appeal allowed.