Meady et al. v. Greyhound Canada Transportation Corp. et al.; James et al., Third Parties [Indexed as: Meady v. Greyhound Canada Transportation Corp.]

90 O.R. (3d) 774

Court of Appeal for Ontario,

Winkler C.J.O., Rosenberg and Feldman JJ.A.

June 12, 2008

Limitations -- Extension -- Special circumstances -- Plaintiffs injured in bus collision in 2000 which was allegedly caused by D seizing steering wheel of bus -- Plaintiffs commencing action against bus company, Crown and others in 2001 -- Plaintiffs seeking in 2006 to add as party defendant doctor who had treated D -- Motion properly dismissed -- Plaintiffs not having commenced "proceeding" against doctor before January 1, 2004 -- Transition provisions of new Limitations Act applying -- Section 24(3) of new Act barring action against doctor -- Common law doctrine of special circumstances not repealed by new Act -- Doctrine available to extend former limitation period when transition provision of new Act applies -- Special circumstances not existing in this case as plaintiffs had made deliberate decision before expiry of former limitation period not to add doctor as defendant -- Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 24(3).

The plaintiffs were injured in a bus collision in December 2000. They alleged that the collision was caused by D, who seized the steering wheel of the bus while it was moving. In June 2001, the plaintiffs commenced actions against D, the bus company, the Crown and others. Prior to the expiry of the two- year limitation period then prescribed by s. 206 of the Highway Traffic Act, R.S.O. 1990, c. H.8, the Crown added Dr. J as a third party to the action, alleging that Dr. J was negligent in failing to provide proper medical care for D and in failing to advise him of the proper dosage and side effects of prescribed medication. In October 2006, the plaintiffs brought a motion to add Dr. J as a party defendant. The motion judge found that s. 21(1) of the Limitations Act, 2002 (the "new Act") applied and that it precluded the addition of Dr. J as a defendant. He also found that if s. 21(1) did not apply, there were no special circumstances that would cause him to exercise his discretion to add Dr. J as a defendant after the expiry of the limitation period. The plaintiffs appealed.

Held, the appeal should be dismissed.

The transition provision of the new Act, s. 24, applied in this case. The words "claims . . . in respect of which no proceeding has been commenced" in s. 24(2) of the new Act refer to claims resulting from particular acts or omissions by a particular party for which no court action has been commenced. Although the plaintiffs commenced a proceeding within the limitation period against certain defendants [page775] in respect of their acts or omissions, no proceeding was commenced by the plaintiffs in respect of the acts or omissions of Dr. J. Section 21(1) of the new Act only applies to claims based on acts or omissions that occurred after January 1, 2004, the effective date of the new Act. It does not apply to claims governed by the transition provisions in s. 24. Section 24(3) was the relevant subsection in this case. It states that where the former limitation period expired before January 1, 2004, "no proceeding shall be commenced in respect of the claim". The former two-year limitation period under the Highway Traffic Act expired before January 1, 2004. Thus, no proceeding could be commenced in respect of the plaintiffs' claim against Dr. J by virtue of s. 24(3).

The common-law doctrine of special circumstances was not repealed by the new Act. Therefore, it continues to form part of the former limitation period. The court can continue to apply the common law special circumstances doctrine, where appropriate, to extend a former limitation period when the transition provision, s. 24 of the new Act, applies. In this case, the plaintiffs made a deliberate decision prior to the expiry of the limitation period not to include Dr. J as a party defendant. There was no basis for interfering with the motion judge's decision that there were no special circumstances warranting an extension of the limitation period.

APPEAL from the order of G.P. Smith J., [2007] O.J. No. 1850, 42 C.P.C. (6th) 208 (S.C.J.), dismissing a motion to add a defendant.

Cases referred to Guillemette v. Doucet (2007), 88 O.R. (3d) 90, [2007] O.J. No. 4172, 2007 ONCA 743, 287 D.L.R. (4th) 522, 230 O.A.C. 202, 48 C.P.C. (6th) 17, 161 A.C.W.S. (3d) 639, consd Other cases considered Basarsky v. Quinlan, 1971 CanLII 5 (SCC), [1972] S.C.R. 380, [1971] S.C.J. No. 118, 24 D.L.R. (3d) 720, [1972] 1 W.W.R. 303; Iroquois Falls Power Corp. v. Jacobs Canada Inc., [2008] O.J. No. 1581, 2008 ONCA 320, 235 O.A.C. 260, 69 C.L.R. (3d) 46, 165 A.C.W.S. (3d) 928; Joseph v. Paramount Canada's Wonderland, (2008), 90 O.R.(3d) 401 [2008] O.J. No. 2339, 2008 ONCA 469, 166 A.C.W.S. (3d) 762; Mazzuca v. Silvercreek Pharmacy Ltd. (2001), 2001 CanLII 8620 (ON CA), 56 O.R. (3d) 768, [2001] O.J. No. 4567, 207 D.L.R. (4th) 492, 152 O.A.C. 201, 15 C.P.C. (5th) 235, 109 A.C.W.S. (3d) 880 (C.A.); Pallotta v. Marks, [2005] O.J. No. 2963, [2005] O.T.C. 606 (S.C.J.); York Condominium Corp. No. 382 v. Jay-M Holdings Ltd. (2007), 84 O.R. (3d) 414, [2007] O.J. No. 240, 2007 ONCA 49, 220 O.A.C. 311, 59 C.L.R. (3d) 15, 36 C.P.C. (6th) 233, 30 M.P.L.R. (4th) 161, 154 A.C.W.S. (3d) 1205 Statutes referred to Highway Traffic Act, R.S.O. 1990, c. H.8, s. 206 [rep.] Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, ss. 1, 4, 19, 20, 21(1), 24, 25 Solicitors Act, R.S.O. 1990, c. S.15, s. 4 Regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rules 1.03(1) [as am.], 5.04(2)

Christopher Hacio, for appellants. Matthew Sammon, for respondent Dr. Mary Ellen James. [page776]

The judgment of the court was delivered by

[1] FELDMAN J.A.: -- This case, released concurrently with this court's decision in Joseph v. Paramount Canada's Wonderland (2008), 2008 ONCA 469, [2008] O.J. No. 2339, 90 O.R.(3d) 401, (C.A.), deals with the application of the special circumstances doctrine under the transition provisions of the new Limitations Act, 2002, S.O. 2002, c. 24, Sch. B (the "new Act").

Background

[2] The appellant plaintiffs were injured in a bus collision that occurred on December 23, 2000. The plaintiffs alleged that the collision was caused by the defendant, Shaun Davis, who seized the steering wheel of the bus while it was moving, causing it to crash. The plaintiffs commenced separate actions against Davis, Greyhound Canada Transportation Corp., Her Majesty the Queen in Right of Ontario (the "Crown"), and others in June 2001.

[3] Prior to the expiry of the two-year limitation period then prescribed by s. 206 of the Highway Traffic Act, R.S.O. 1990, c. H.8, the defendant Crown added the respondent, Dr. James, as a third party to the action. The Crown alleged that Dr. James was negligent in failing to provide proper medical care for Davis and in failing to advise him of the proper dosage and side effects of certain medication prescribed to him, which the Crown alleged caused or contributed to his actions causing the accident. All actions, including the third- party claims, were ordered consolidated in December 2004.

[4] The relevant limitation period expired on December 23, 2002. In October 2006, the plaintiffs sought to add Dr. James as a party defendant to the action. Dr. James opposed the motion on two grounds: (1) that s. 21(1) of the new Act applied and its effect was to preclude the addition of a claim against a new party to an existing action after the expiry of the limitation period; and (2) that if s. 21(1) did not apply or did not have that effect, there were no special circumstances that would warrant adding Dr. James as a defendant, even though she was already a party to the action as a third party.

[5] The motion judge decided the motion on both grounds. He found that s. 21(1) of the new Act applied and that it precluded the addition of Dr. James as a defendant. Section 21(1) states:

21(1) If a limitation period in respect of a claim against a person has expired, the claim shall not be pursued by adding the person as a party to any existing proceeding. [page777]

[6] The motion judge also found that if s. 21(1) did not apply, there were no special circumstances that would cause him to exercise his discretion to add Dr. James as a defendant after the expiry of the limitation period.

Issues

[7] The following issues are raised on the appeal: (1) What provisions of the new Act apply in the circumstances of this case? (2) Can the court continue to consider whether an extension of the limitation period can be granted based on the common- law doctrine of special circumstances under s. 24, the transition provision of the new Act? (3) If so, is there any basis to interfere with the motion judge's decision that there were no special circumstances in this case?

Analysis

(1) Which provisions of the new Act apply?

[8] The events that gave rise to the claims in this case occurred in December 2000. The plaintiffs commenced an action against a number of defendants within the applicable two-year limitation period under the Highway Traffic Act. On January 1, 2004, the new Act came into effect. The plaintiffs brought their motion to add Dr. James as a defendant in October 2006. Because the relevant events occurred before January 1, 2004 but the motion was brought after, the court must determine which provisions of the new Act apply.

[9] The new Act contains transition provisions in s. 24 that deal with the application of the new Act to claims based on acts or omissions that took place before the new Act came into effect, but in respect of which no proceeding was commenced before January 1, 2004. Subsections 24(2) and (3) provide:

24(2) This section applies to claims based on acts or omissions that took place before the effective date and in respect of which no proceeding has been commenced before the effective date.

(3) If the former limitation period expired before the effective date, no proceeding shall be commenced in respect of the claim.

[10] In this case, the relevant events took place long before the new Act came into effect and, while the plaintiffs commenced a proceeding before the effective date, it was not a proceeding in respect of a claim against Dr. James. In order to determine [page778] whether s. 24 applies, it must first be determined what constitutes a "claim" and a "proceeding".

[11] The term "claim" is defined in s. 1 of the new Act as "a claim to remedy an injury, loss or damage that occurred as a result of an act or omission". This definition focuses on particular acts or omissions, even if more than one act or omission by more than one party contributed to the same injury. The term "proceeding" is not defined in the new Act. However, it is defined in rule 1.03(1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, as "an action or application". Thus, the words "claims . . . in respect of which no proceeding has been commenced" in s. 24(2) refer to claims resulting from particular acts or omissions by a particular party for which no court action has been commenced. This interpretation has been applied in several decisions of the Superior Court of Justice, including Pallotta v. Marks, [2005] O.J. No. 2963, [2005] O.T.C. 606 (S.C.J.), in which Hoy J. noted, at para. 23, that it would be inconsistent with the scheme of the new Act "for 'proceeding' in s. 24(2) to be interpreted without reference to the person against whom the proceeding is made". Accordingly, although the plaintiffs commenced a proceeding within the limitation period against certain defendants in respect of their acts or omissions, no proceeding was commenced by the plaintiffs in respect of the acts or omissions of Dr. James. Consequently, the transition provision, s. 24 of the new Act, applies.

[12] The motion judge applied s. 21(1) of the new Act. However, that section only applies to claims based on acts or omissions that occurred after January 1, 2004, the effective date of the new Act. It does not apply to claims governed by the transition provisions in s. 24.

[13] Section 24(3) is the relevant section in this case. It states that where the former limitation period expired before January 1, 2004, "no proceeding shall be commenced in respect of the claim". As discussed above, because a claim relates to a specific act or omission of a particular party, this transition section has a similar effect to s. 21(1) by precluding the addition of a claim based on the act or omission of a new party after the limitation period has expired. In this case, the former two-year limitation period under the Highway Traffic Act expired before January 1, 2004. Thus, no proceeding could be commenced in respect of the plaintiffs' claim against Dr. James by virtue of s. 24(3).

(2) Does the special circumstances doctrine apply?

[14] The next issue is whether the court retains discretion under the transition provision of the new Act to extend the [page779] former limitation period by applying the common law special circumstances doctrine to permit a claim to be brought after the expiry of the former limitation period.

[15] In Joseph, this court held that the common law doctrine of special circumstances cannot be used to extend the limitation period under the general, non-transition provisions of the new Act. The court concluded, at para. 26, that if these provisions:

. . . were interpreted to include the extension of limitation periods generally by the common law doctrine of special circumstances under the Rules, the effect would be contrary to the purpose of the new Act by removing the certainty of its limitation scheme.

[16] This analysis was based on the conclusion that the new Act is intended to provide a comprehensive limitations scheme. Section 4 establishes a basic two-year limitation period from the date a claim is discovered, "[u]nless this Act provides otherwise". A court is therefore required to find any exceptions to that basic limitation period elsewhere in the new Act. For example, s. 20 is an exception that provides:

20. This Act does not affect the extension, suspension or other variation of a limitation period or other time limit by or under another Act.

[17] In Joseph, this court held that s. 20, which refers to statutory extension provisions, does not extend to common-law extension provisions such as the common-law doctrine of special circumstances.

[18] The transition provision provides another such exception by defining how limitations are to be treated in transitional circumstances that bridge the former limitations regime and the new Act.

[19] Section 24(3) is definitive and makes no reference to an extension of the limitation period based on special circumstances. However, it refers to the former limitation period, not the new one. As noted in Joseph, the former limitation period was interpreted and applied in accordance with the common law developed in Basarsky v. Quinlan, 1971 CanLII 5 (SCC), [1972] S.C.R. 380, [1971] S.C.J. No. 118, and under rule 5.04(2) of the Rules of Civil Procedure to allow the court to add a party to an action after the expiry of a limitation period where special circumstances existed and where there was no non- compensable prejudice to the defendant: see e.g., Mazzuca v. Silvercreek Pharmacy Ltd. (2001), 2001 CanLII 8620 (ON CA), 56 O.R. (3d) 768, [2001] O.J. No. 4567 (C.A.).

[20] It is clear that a potential extension was available under the former limitation period if special circumstances were found to exist. The court's discretion to extend the period derived from the common law, as interpreted in conjunction [page780] with rule 5.04(2), rather than from any statutory provision. In this court's recent decision in Iroquois Falls Power Corp. v. Jacobs Canada Inc., [2008] O.J. No. 1581, 2008 ONCA 320, Juriansz J.A. held that where the former limitation period preserved by s. 24(3) contained a statutory discretionary extension provision that was specifically repealed by s. 25 of the new Act, the repeal of the discretionary extension meant that it was not available to be used when applying the former limitation period under s. 24.

[21] This can be contrasted with the situation in Guillemette v. Doucet (2007), 2007 ONCA 743, 88 O.R. (3d) 90, [2007] O.J. No. 4172 (C.A.), which dealt with the applicability of the limitation provision contained in s. 4 of the Solicitors Act, R.S.O. 1990, c. S.15. That section contained both a 12-month limitation period and a specific discretion for the court to extend the period under "special circumstances". The limitation portion of s. 4 was repealed by the general operation of s. 19 of the new Act, but the discretion to extend the limitation period was not repealed and remained effective under s. 20 of the new Act. The court held that if the transition section applied, the unrepealed statutory extension provision remained available under s. 24 to extend the former limitation period where appropriate.

[22] This case is more similar to Guillemette in that the common-law doctrine of special circumstances was not repealed by the new Act. Therefore, it continues to form part of the former limitation period. As in Guillemette, by incorporating the former limitation period, s. 24(3) includes all aspects of that period that were not repealed by the new Act, including the ability to extend the limitation period if there are special circumstances for doing so. This interpretation is consistent with Weiler J.A.'s comment in York Condominium Corp. No. 382 v. Jay-M Holdings Ltd. (2007), 2007 ONCA 49, 84 O.R. (3d) 414, [2007] O.J. No. 240 (C.A.), at para. 39, that although the transition provision "may be regarded as generous, it is part of the [new] Act's attempt to ensure that, with respect to pre-existing situations, access to justice be preserved".

[23] In my view, such an interpretation is also consistent with the comprehensive nature of the new Act. Section 24(3) "provides otherwise" within the meaning of s. 4 by making the former limitation period applicable to some claims otherwise governed by the new Act. There is no basis to conclude that in causing the former limitation period to apply, the legislature did not intend to include all aspects of the operation of that period, including extensions based on special circumstances. In that way, the transition provision differs from the general provisions of the new [page781] Act, which do not incorporate the former limitation period or the common-law extension that was previously available.

[24] For these reasons, I conclude that the court can continue to apply the common-law special circumstances doctrine, where appropriate, to extend a former limitation period when the transition provision, s. 24 of the new Act, applies.

(3) Were there special circumstances in this case?

[25] The motion judge considered whether there were special circumstances in this case that would allow him to extend the former limitation period to permit the plaintiffs to add a claim against Dr. James to the existing proceeding. He concluded that there were no such circumstances in this case. He found that the plaintiffs and their counsel made a deliberate decision before the expiry of the limitation period not to include Dr. James as a party defendant. This was a considered decision based on legal and practical factors. The motion judge observed that the plaintiffs and their counsel had changed their minds about suing Dr. James, but had not explained the reason for the change. He concluded that such a change of mind does not amount to special circumstances, even if there was no non-compensable prejudice to Dr. James.

[26] I see no basis to interfere with the motion judge's decision that there are no special circumstances in this case warranting an extension of the limitation period. As that decision is discretionary, this court will not interfere where the judge considered all the relevant factors and made no error of law or of perception of the facts.

Conclusion

[27] Therefore, while the motion judge erred in applying s. 21(1) of the new Act, and in holding that the transition provision did not apply in this case, his conclusion that the proceeding was barred was ultimately correct. Under s. 24(3), prima facie no claim could be brought against Dr. James after January 1, 2004. The former limitation period could only be extended based on special circumstances. The motion judge concluded that there were no special circumstances in this case and there is no basis to interfere with that conclusion.

[28] For these reasons, I would dismiss the appeal with costs fixed at $7,000, inclusive of GST and disbursements.

Appeal dismissed.