Canaccord Capital Corporation v. Roscoe

[Indexed as: Canaccord Capital Corp. v. Roscoe]

Ontario Reports

Court of Appeal for Ontario,

Sharpe, Epstein and Pepall JJ.A.

June 7, 2013

115 O.R. (3d) 641 | 2013 ONCA 378

Case Summary

Limitations — Contribution and indemnity — Section 18 of Limitations Act applying to claims for contribution and indemnity that arise out of contract — Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, s. 18.

R was an investment advisor employed by C Corp., an investment dealer. His employment agreement contained a provision that he would indemnify C Corp. for any claim made against C Corp. arising out of R's acts or omissions within or without the course of his activities or employment. Two of R's former clients sued C Corp. and R for losses arising out of an investment for which R was their advisor. C Corp. did not cross-claim against R for indemnity, and ultimately settled the action without R's involvement. Almost three years after the delivery of the statement of claim in that action, C Corp. commenced an action against R based on the indemnification clause in the employment agreement. R brought a motion for summary judgment dismissing the action as time-barred by operation of s. 18 of the Limitations Act, 2002 as it was commenced more than two years after C Corp. was served with the clients' statement of claim. The motion was dismissed. R appealed.

Held, the appeal should be allowed.

The motion judge erred in holding that s. 18 of the Act did not apply to indemnity claims arising out of contracts. The fact that C Corp.'s claim was based upon the employment agreement rather than upon the Negligence Act, R.S.O. 1990, c. N.1 did not exclude the claim from the reach of s. 18. The motion judge's interpretation, creating one start date for the limitation period for claims for contribution and indemnity based on the Negligence Act and a different start date for the limitation period for claims for contribution and indemnity based upon contract, was inconsistent with the overall aim of the Act to achieve clarity and uniformity.

Cases referred to

Hardisty v. 851791 N.W.T. Ltd., [2004] N.W.T.J. No. 58, 2004 NWTSC 70, [2005] 5 W.W.R. 334, 26 C.C.L.T. (3d) 305, 134 A.C.W.S. (3d) 530; HSBC Securities (Canada) Inc. v. Davies, Ward & Beck (2005), 2005 1626 (ON CA), 74 O.R. (3d) 295, [2005] O.J. No. 277, 249 D.L.R. (4th) 571, 194 O.A.C. 1, 136 A.C.W.S. (3d) 822 (C.A.); IPEX Inc. v. Lubrizol Advanced Materials Canada Inc., [2012] O.J. No. 2218, 2012 ONSC 2717, 4 B.L.R. (5th) 148 (S.C.J.); Rizzo & Rizzo Shoes Ltd. (Re) (1998), 1998 837 (SCC), 36 O.R. (3d) 418, [1998] 1 S.C.R. 27, [1998] S.C.J. No. 2, 154 D.L.R. (4th) 193, 221 N.R. 241, J.E. 98-201, 106 O.A.C. 1, 50 C.B.R. (3d) 163, 33 C.C.E.L. (2d) 173, 98 CLLC Â210-006, 76 A.C.W.S. (3d) 894; Waterloo Region District School Board v. CRD Construction Ltd. (2010), 103 O.R. (3d) 81, [2010] O.J. No. 5358, 2010 ONCA 838, 271 O.A.C. 142, 97 C.L.R. (3d) 274, 327 D.L.R. (4th) 611, 100 C.P.C. (6th) 1, 196 A.C.W.S. (3d) 257; Yugraneft Corp. v. Rexx Management Corp., [2010] 1 S.C.R. 649, [2010] S.C.J. No. 19, 2010 SCC 19, 401 N.R. 341, EYB 2010-174202, 2010EXP-1696, J.E. 2010-926, 318 D.L.R. (4th) 257, 188 A.C.W.S. (3d) 330, 68 B.L.R. (4th) 1, 22 Alta. L.R. (5th) 166, 84 C.P.C. (6th) 201, [2010] 6 W.W.R. 387, 482 A.R. 1 [page642]

Statutes referred to

An Act to amend The Negligence Act, S.O. 1948, c. 61, s. 3

Justice Statute Law Amendment Act, 2002, S.O. 2002, c. 24, Sch. B, s. 26

Limitations Act, 2002, S.O. 2002, c. 24, Sch. B, ss. 4, 5 [as am.], 18, (2), 22 [as am.]

Negligence Act, R.S.O. 1937, c. 115

Negligence Act, R.S.O. 1990, c. N.1 [as am.]

Authorities referred to

Limitations Act Consultation, Recommendations for a New Limitations Act: Report of the Limitations Act Consultation Group (Toronto: Ministry of the Attorney General, 1991)

Ontario Law Reform Commission, Report of the Ontario Law Reform Commission on Limitation of Actions (Toronto: Department of the Attorney General, 1969)

APPEAL from the order of Polowin J., [2012] O.J. No. 4933, 2012 ONSC 5714, 222 A.C.W.S. (3d) 247 (S.C.J.) dismissing a motion for summary judgment.

John Melia, for appellant.

Helen Daley, for respondent.

The judgment of the court was delivered by

[1] SHARPE J.A.: — This appeal raises the issue of the scope of s. 18 of the Limitations Act, 2002, S.O. 2002, c. 24, Sch. B (the "Act"), which governs claims for contribution and indemnity brought by one wrongdoer against another. Is a claim for indemnity by an employer against an employee for an amount paid by the employer to settle a claim brought by a client for damages caused by the wrong of the employee governed by s. 18?

Facts

[2] The appellant, Gregory Roscoe ("Roscoe"), was an investment advisor employed by the respondent, Canaccord Capital Corporation ("Canaccord"), an investment dealer. Roscoe's employment agreement contained a provision providing that Roscoe would indemnify Canaccord for any claim made against Canaccord arising out of Roscoe's acts or omissions within or without the course of his activities or employment.

[3] In August 2008, two of Roscoe's former clients, Thomas and Kathleen Cavanagh (the "Cavanaghs"), served Canaccord and Roscoe with a statement of claim for losses arising out of an investment for which Roscoe was their investment advisor. The statement of claim alleged that both Roscoe and Canaccord owed the Cavanaughs a duty of care, inter alia, to assess their risk [page643] tolerance and to use due diligence with respect to investment recommendations. It further alleged that that duty had been breached by both Roscoe and Canaccord and asserted a claim for damages.

[4] Canaccord funded a joint defence and delivered a joint statement of defence. Canaccord did not cross-claim against Roscoe for indemnity. In April or May 2009, Canaccord entered settlement discussions with the Cavanaghs. Roscoe retained independent counsel who advised Canaccord that Roscoe denied any wrongdoing, would dispute any indemnity claim and reserved his right to assert any available defences to any claim for indemnity. In July 2009, without Roscoe's involvement, Canaccord settled with the Cavanaghs.

[5] In January 2010, a vice-president at Canaccord wrote to Roscoe requesting indemnification pursuant to Roscoe's employment agreement. Article 5.02 of the agreement provides:

In the event that any claim is made against the Company or the Company is found vicariously liable or jointly or severally liable with the Registered Representative resulting from a claim made against the Registered Representative and/ or the Company principally arising out of an act or omission of the Registered Representative within or without the course of his activities or employment, the Registered Representative shall be responsible for and shall indemnify, reimburse and save harmless the Company for all losses, damages or amounts due to any claimant and as well as e [sic] expenses or costs including legal fees reasonably incurred by the Company in defence of any claim or legal action arising from such act or omission. Such liability of the Registered Representative shall extend to indemnify and reimburse the Company as aforesaid whether or not such liability arises as a result of a judgment of a court of law, decision of an administrative body, an arbitration [award] or a settlement reasonably made by the Company to avoid the necessity of a trial or hearing.

[6] Through a letter from his counsel in February 2010, Roscoe denied any liability and resisted Canaccord's claim for indemnification.

[7] In June 2011, almost three years after the delivery of the Cavanagh statement of claim, Canaccord commenced this indemnity action against Roscoe, claiming the amount of the settlement plus Canaccord's legal fees. The claim is pleaded as a claim for damages for breach of contract. The basis for the claim against Roscoe is pleaded as follows:

9. Roscoe is liable to indemnify Canaccord for the amount it paid to settle the Cavanaghs' Claim and for its legal fees pursuant to his Employment Agreement with Canaccord. The Employment Agreement specifically provides that Roscoe is required to "indemnify, reimburse and save harmless" Canaccord for all amounts paid to settle claims by Roscoe's clients together with the legal fees reasonably incurred by Canaccord in relation to those claims. [page644]

10. In the alternative, it is an accepted custom and practice within the retail investment industry that investment advisors such as Roscoe indemnify their employer for [moneys] paid on the advisors' behalf to compensate clients in circumstances such as those arising in the Cavanagh Claim.

11. Notwithstanding Canaccord's demand that Roscoe honour his obligation to indemnify it for its legal fees and the amount which it paid to settle the Cavanagh Claim, Roscoe has neglected or refused to do so.

[8] In May 2012, Roscoe brought a motion for summary judgment dismissing the action, arguing that as Canaccord's action was commenced more than two years after Canaccord was served with the Cavanagh claim, it was time-barred by operation of s. 18 of the Act. The motion judge dismissed the motion and Roscoe appeals.

Legislation

[9] Section 18 of the Act governs claims "by one alleged wrongdoer against another for contribution and indemnity". It provides for a two-year limitation period that runs from the date the wrongdoer claiming contribution and indemnity was served with the claim of the injured party:

Contribution and indemnity

18(1) For the purposes of subsection 5(2) and section 15, in the case of a claim by one alleged wrongdoer against another for contribution and indemnity, the day on which the first alleged wrongdoer was served with the claim in respect of which contribution and indemnity is sought shall be deemed to be the day the act or omission on which that alleged wrongdoer's claim is based took place.

Application

(2) Subsection (1) applies whether the right to contribution and indemnity arises in respect of a tort or otherwise.

[10] The basic limitation period is two years and applies without reference to any specific causes of action to claims not otherwise specifically addressed in the Act. Sections 4 and 5 of the Act provide:

Basic limitation period

4. Unless this Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.

Discovery

5(1) A claim is discovered on the earlier of,

(a) the day on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred, [page645]

(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) that the act or omission was that of the person against whom the claim is made, and

(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and

(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).

Motion for Summary Judgment

[11] The motion judge held that s. 18 was not applicable because the provision did not apply to indemnity claims arising out of contract. She found that Canaccord's actions did not assert a claim for "'contribution and indemnity' as between one wrongdoer and another". In her view, Canaccord's action was more properly categorized for limitations purposes as a claim for breach of Roscoe's employment contract, and that it was therefore governed by the basic two-year limitation period that ran from the date Canaccord settled the Cavanagh action. The motion judge held that a breach of contract claim for damages is fundamentally different from a claim for contribution and indemnity as between two wrongdoers and that s. 18 does not apply to claims for damages for breach of contract.

[12] She interpreted art. 5.02 of the employment contract, set out above, as providing that Roscoe's obligation to reimburse Canaccord only arose at the point of a judgment of a court, a decision of an administrative body, an arbitration award or a settlement. As the indemnity claim did not crystallize until Canaccord settled, the obligation to reimburse did not arise until that time.

[13] Consequently, she concluded that Canaccord's claim was governed by the basic limitation period and Canaccord had two years to launch its action from discovery of the claim, which she held to be the settlement date, "the earliest date from which the limitation period could run". As Canaccord had commenced its action within two years of the settlement, the action had been brought within the applicable period. The motion for summary judgment was accordingly dismissed.

Issues

[14] Roscoe raises two issues:

(1) Did the motion judge err in finding that the action was not barred by s. 18 of the Act? [page646]

(2) If the motion judge did not err in finding that the action was governed by the two-year basic limitation period, did she err by deciding the discoverability issue?

Analysis

Issue 1. Did the motion judge err in finding that the action was not barred by s. 18 of the Act?

[15] In my respectful view, the motion judge erred in her characterization of the claim advanced by Canaccord against Roscoe and in her interpretation of s. 18. I reach that conclusion for the following reasons.

(a) Legislative history

[16] A brief review of the evolution of the legislation governing the limitation period applicable to claims for contribution and indemnity will facilitate my analysis of s. 18. The legislature first dealt specifically with claims for contribution and indemnity as between torfeasors in 1948. An Act to amend The Negligence Act, S.O. 1948, c. 61, s. 3 amended the Negligence Act, R.S.O. 1937, c. 115, and extended the limitation period for claims for contribution and indemnity by one tortfeasor against another by providing that such a claim could be brought within one year of the date of judgment or settlement disposing of the underlying tort claim despite the operation of any limitation period against the other tortfeasor: see HSBC Securities (Canada) Inc. v. Davies, Ward & Beck (2005), 2005 1626 (ON CA), 74 O.R. (3d) 295, [2005] O.J. No. 277 (C.A.), at para. 56. This provision was included in successive versions of the Negligence Act and remained in force for over 50 years until the Act was passed in 2002 and repealed the provision: Justice Statute Law Amendment Act, 2002, S.O. 2002, c. 24, Sch. B, s. 26.

[17] Section 18 of the Act reflects two significant changes relating to the limitation period applicable to claims for contribution and indemnity. First, s. 18 was part of a fundamental and comprehensive reform of the law of limitations in Ontario aimed at creating a clear and cohesive scheme for addressing limitation issues, one that balances the plaintiff's right to sue with the defendant's need for certainty and finality. Second, the wording of s. 18 is significantly different from the provision it replaced.

[18] Although the Act was passed in 2002 and only came into force in 2004, it was the culmination of numerous reports and bills beginning in the 1960s with a view to reforming the law of limitations. [page647]

[19] In 1969, the Ontario Law Reform Commission (the "OLRC") highlighted the need to reform Ontario's limitation legislation: see Ontario Law Reform Commission, Report of the Ontario Law Reform Commission on Limitation of Actions (Toronto: Department of the Attorney General, 1969). The OLRC identified the proliferation of special statutory limitation periods in over 60 different statutes and drew attention to the problem of "far too many special limitations periods": at p. 12. It lamented how "Ontario's limitation laws ha[d] become out of touch with current needs" and emphasized the "difficulties with regard to the time at which limitation periods begin to run": at p. 12. The OLRC described the purpose of limitation periods as follows, at p. 9:

Lawsuits should be brought within a reasonable time. This is the policy behind limitation statutes. These laws are designed to prevent persons from beginning actions once that reasonable time has passed. Underlying the policy is a recognition that it is not fair that an individual should be subject indefinitely to the threat of being sued over a particular matter. Nor is it in the interests of the community that disputes should be capable of dragging on interminably. Furthermore, evidentiary problems are likely to arise as time passes. Witnesses become forgetful or die: documents may be lost or destroyed. Certainly, it is desirable that, at some point, there should be an end to the possibility of litigation in any dispute. A statute of limitation is sometimes referred to as an "Act of peace".

[20] The second change is in the specific wording of s. 18, which contains two features that are consistent with and, in my view, driven by that general overall purpose. Significantly, s. 18 departs from the model established in 1948 in the Negligence Act. The provision in the Negligence Act applied only to claims for contribution and indemnity as between tortfeasors. It allowed such claims to be brought within one year of settlement or judgment in the underlying action, despite the expiry of any limitation period governing the claim of the injured party against the other tortfeasor. In contrast, s. 18 applies not only to claims as between tortfeasors but also to claims for contribution and indemnity by one "wrongdoer" against another, "whether the right to contribution and indemnity arises in respect of a tort or otherwise". Moreover, s. 18 significantly shortens the limitation period governing contribution and indemnity claims to two years from the date the first alleged wrongdoer was served with the underlying claim, thereby encouraging resolution of all claims arising from the wrong at the same time.

[21] The changes adopted in s. 18 seem to first have appeared in a report produced in 1991 for the Ministry of the Attorney General: see Limitation Act Consultation Group, Recommendations for a New Limitations Act: Report of the Limitations Act Consultation Group [page648] (Toronto: Ministry of the Attorney General, 1991). The consultation group that authored the report recommended that the date of the act or omission for triggering the standard two-year limitation period for contribution and indemnity against another tortfeasor be the date when the tortfeasor was served with the claim by the plaintiff: at p. 42. In describing the problem with focusing on the date of judgment or settlement, the consultation group wrote, at p. 42:

Under the present law . . . [t]he limitation period on the claim against the second wrongdoer begins when the first wrongdoer is adjudged to be liable to the plaintiff.

The difficulty with the present law is that the first wrongdoer can wait to commence legal proceedings against the second wrongdoer until long after the limitation period between the second wrongdoer and the plaintiff has expired, even though the first wrongdoer's claim is based on the second wrongdoer's liability to the plaintiff. If the second wrongdoer had been sued by the plaintiff in a timely manner, the second wrongdoer may have been able to defeat the plaintiff's claim. But, years later, the second wrongdoer may have lost his or her evidence or the plaintiff may no longer exist.

[22] The consultation group acknowledged that this approach had not been recommended in the OLRC's comprehensive report in 1969, but stated that "in the context of a comprehensive review of limitations policy, especially with emphasis upon the discovery principle, it [did] not seem unfair to encourage the first wrongdoer to commence proceedings for contribution as soon as possible": at p. 43. The consultation group concluded that by moving the limitation starting point to the date of the plaintiff's claim, "the limitation policy shorten[ed] the second wrongdoer's exposure to potential liability and increase[d] the second wrongdoer's ability to defend the claim": at p. 43.

[23] The recommendation of the consultation group was adopted in draft legislation that did not proceed beyond first reading in 1992 (Bill 99, An Act to revise the Limitations Act, 2nd Sess., 35th Leg., Ontario, 1992), 2000 (Bill 163, An Act to revise the Limitations Act, 1st Sess., 37th Leg., Ontario, 2000) and 2001 (Bill 10, An Act to revise the Limitations Act, 2nd Sess., 37th Leg., Ontario, 2000). Finally, the Act, which incorporated the consultation group's recommendation, was passed in 2002: Justice Statute Law Amendment Act.

[24] In my view, the departure from the 1948 model to embrace "wrongdoers", not just tortfeasors, and to cover claims that arise "in respect of a tort or otherwise" represented a conscious decision to expand the scope of the provision beyond the tort context to include claims like the one at issue in this case. [page649] This is consistent with the often-repeated goal of creating a clear, cohesive scheme for addressing limitation issues. As mentioned, the purpose of the Act is to balance the plaintiff's right to sue with the defendant's need for certainty and finality. Carving out exceptions to the general rule in s. 18 for certain types of claims in contribution and indemnity would undercut that purpose. It would expose defendants from whom contribution and indemnity is sought to unpredictable limitation periods, undermining the defendant's ability to defend the claim. Consequently, it is my view that the legislative history supports the conclusion that s. 18 of the Act governs the claim at issue.

(b) The principles of statutory interpretation

[25] The often-quoted basic principle of statutory interpretation is that expressed in Rizzo & Rizzo Shoes Ltd. (Re) (1998), 1998 837 (SCC), 36 O.R. (3d) 418, [1998] 1 S.C.R. 27, [1998] S.C.J. No. 2, at para. 21:

Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament.

[26] The claim Canaccord asserts against Roscoe in its statement of claim is that he "indemnify" Canaccord for the amount it paid to settle the Cavanagh claim. The source of the Canaccord claim is the claim the Cavanaghs asserted against both Canaccord and Roscoe as wrongdoers jointly liable to pay damages caused by the alleged breach of duty they owed the Cavanaghs as their investment dealer and advisor. It follows that Canaccord's claim against Roscoe falls squarely within the grammatical and ordinary meaning of the language of s. 18 as "a claim by one alleged wrongdoer against another for contribution and indemnity".

[27] When s. 18 is read harmoniously with the scheme and object of the Act and the intention of the legislature, the conclusion that Canaccord's claim against Roscoe is governed by s. 18 gains added strength. As I have noted, the Act reflects a marked departure from the past, when different limitation periods were found in different statutes and based upon the characterization of the specific cause of action pleaded. The Act achieved a significant reform by eliminating that plethora of limitation periods and replacing them with a "basic limitation period" based upon the discovery of the claim.

[28] Section 18 creates a specific rule for determining when a claim for contribution and indemnity is discovered. Section 18 provides that a claim for contribution and indemnity is discovered [page650] on the day the first alleged wrongdoer is served with the claim in respect of which contribution and indemnity is sought. In other words, once the party seeking indemnity is served with the injured party's statement of claim, the claim is discovered and the two-year limitation period starts to run. Section 18(2) makes clear that this special rule for claims for contribution and indemnity "applies whether the right to contribution and indemnity arises in respect of a tort or otherwise" (emphasis added). The legal theory grounding the contribution and indemnity claim is not relevant for deciding whether s. 18 is triggered; the provision applies when there is a claim for contribution and indemnity, no matter what legal theory underlies the claim.

[29] I therefore cannot agree that the fact that Canaccord's claim is based upon the employment agreement rather than upon the Negligence Act excludes the claim from the reach of s. 18. In my respectful view, to so hold would be to ignore a fundamental feature of the Act. It is, on its face, a claim for indemnity brought by one alleged wrongdoer against another and the fact that it is grounded in contract has no bearing on the question of whether or not it falls within the reach of s. 18. I agree with Roscoe that the motion judge's interpretation creating one start date for limitation period for claims for contribution and indemnity based upon the Negligence Act, R.S.O. 1990, c. N.1 and a different start date for limitation period for claims for contribution and indemnity based upon contract is inconsistent with the overall aim of the Act to achieve clarity and uniformity.

[30] While the specific point before us on this appeal is a matter of first impression, interpreting s. 18 to embrace all claims for contribution and indemnity, whether arising in tort or contract, accords with the interpretation this court gave s. 18 in Waterloo Region District School Board v. CRD Construction Ltd. (2010), 103 O.R. (3d) 81, [2010] O.J. No. 5358, 2010 ONCA 838, per Feldman J.A., writing for a five-judge panel. The issue in that case was whether by replacing the 1948 model, s. 18 had reverted to the situation in which a claim for contribution and indemnity is barred by the expiry of the limitation period governing the claim of the injured party against the party from whom contribution is sought. The court rejected that proposition, holding, at para. 24, that

. . . a claim for contribution and indemnity, whether in tort or otherwise, now has a two-year limitation period that is presumed to run from the date when the person who seeks contribution and indemnity is served with the plaintiff's claim that gives rise to its claim over. This is the only limitation period in the Act that applies to claims for contribution and indemnity.

(Emphasis added) [page651]

Feldman J.A. went on to state, at para. 26:

If the court were to conclude that, despite the clear wording of s. 18, there is a further limitation period that applies to claims for contribution and indemnity against a concurrent tortfeasor in negligence, and that such claims must also be brought before the expiry of the limitation period applicable to the plaintiff's claim against that tortfeasor, the effect of a universal limitation period for contribution and indemnity claims in s. 18 would be abrogated and the clarity and efficacy of the section undermined.

(Emphasis added)

[31] She then cited Yugraneft Corp. v. Rexx Management Corp., [2010] 1 S.C.R. 649, [2010] S.C.J. No. 19, 2010 SCC 19, at para. 36, where the Supreme Court explained the streamlining purpose of Alberta's new limitations regime:

The Act was intended to create a comprehensive and simplified limitations regime to replace the previous Limitation of Actions Act, R.S.A. 1980, c. L-15. As the Alberta Court of Appeal noted in Daniels v. Mitchell, 2005 ABCA 271, 51 Alta. L.R. (4th) 212, at para. 30:

[A] main purpose of the [Limitations Act] was the simplification of limitations law, by the imposition of one period (two years) for nearly all causes of action. . . . [D]ebates in the Legislative Assembly repeatedly emphasized that the new legislation would simplify and clarify the system while eliminating inconsistencies and special treatment for certain defendants.

Thus, the purpose of the Act was to streamline the law of limitations by limiting the number of exceptions and providing a uniform limitation period for most actions.

[32] Similarly, in IPEX Inc. v. Lubrizol Advanced Materials Canada Inc., [2012] O.J. No. 2218, 2012 ONSC 2717, 4 B.L.R. (5th) 148 (S.C.J.), at para. 19, Belobaba J. held that an indemnity claim based in contract and tort is "primarily a claim for indemnity" and therefore governed by s. 18.

[33] There is a suggestion in the reasons of the motion judge that s. 18 does not apply because it is a claim only for "indemnity" and not "contribution and indemnity". I agree with Roscoe that that is a distinction without a difference. The difference between contribution and indemnity is simply the extent of the recovery: see Hardisty v. 851791 N.W.T. Ltd., [2004] N.W.T.J. No. 58, 2004 NWTSC 70, 26 C.C.L.T. (3d) 305, at para. 3.

[34] Finally, I agree with Roscoe that the motion judge erred in her interpretation of the employment agreement to the extent that she held that Canaccord's claim only arose under the contract at the point of a judgment of a court, a decision of an administrative body, an arbitration award or a settlement. The employment contract provides that the obligation to indemnify is triggered, inter alia, if "any claim is made against the Company". This coincides with the language of s. 18 and, [page652] accordingly, it is not necessary for me to consider the situation that would arise if the language of the contract and the language of s. 18 differed.

[35] I add here that one of the motion judge's concerns was to avoid an interpretation that would, as a practical matter, require Canaccord to claim indemnity in the Cavanagh action and prevent Canaccord and Roscoe from presenting a common front. There are two answers to that concern.

[36] First, the concern is inconsistent with one of the intended features of s. 18. As noted by Feldman J.A. in Waterloo Region District School Board, at para. 29, by linking the limitation period governing contribution and indemnity claims to the claim of the injured party, "it is contemplated that all claims arising out of the incident that caused the injury will be tried and disposed of together". It is clearly in the interest of justice to have all related claims dealt with at the same time and that is encouraged by interpreting s. 18 to embrace all claims for indemnity as between the wrongdoers who are or may be responsible for the loss.

[37] Second, the Act provides at least a partial answer for those wrongdoers who wish to present a common front and postpone the litigation of their claims inter se. Section 22 permits parties to agree to toll the limitation period. There is nothing in the correspondence between counsel for Roscoe and Canaccord that could amount to a tolling agreement pursuant to s. 22.

[38] In my view, when the words of s. 18 are read in their full context, bearing in mind their grammatical and ordinary sense, the scheme and object of the Act and the legislature's purpose, it is clear that the provision applies and precludes Canaccord from asserting this claim for indemnification against Roscoe.

(c) Conclusion

[39] Having reviewed the legislative history of the Act and applied the principles of statutory interpretation, I would hold that the motion judge erred in finding that Canaccord's action was not barred by s. 18 of the Act.

Issue 2. If the motion judge did not err in finding that the action was governed by the two-year basic limitation period, did she err by deciding the discoverability issue?

[40] Given my answer to the first issue, it is not necessary to consider this issue. [page653]

Disposition

[41] For these reasons, I would allow the appeal, set aside the order of the motion judge and in its place substitute an order dismissing the action on the ground that the claim is barred by s. 18 of the Act. Roscoe is entitled to his costs of the appeal fixed at $12,500, inclusive of disbursements and applicable taxes.

Appeal allowed.

End of Document