Court of Appeal for Ontario

Date: December 20, 2019

Docket: C66914

Judges: Watt, Hourigan and Trotter JJ.A.

Parties

Between

Leslie Sosnowski and Theresa Sosnowski Plaintiffs (Appellants)

and

MacEwen Petroleum Inc. and Richard Joseph Paul Bourdeau Defendants (Respondent)

Counsel

For the Appellants: Gustavo Camelino

For the Respondent: Porter Heffernan and Joël Rocque

Hearing and Appeal

Heard: November 27, 2019

On appeal from: The judgment of Justice Helen MacLeod-Beliveau of the Superior Court of Justice, dated April 11, 2019, with reasons reported at 2019 ONSC 1860.

Decision

Hourigan J.A.:

Introduction

[1] At issue on this appeal is the interpretation of s. 5(1)(a)(iv) of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B, the so-called appropriate means provision. That subsection provides that a claim is not discovered until the day on which a putative plaintiff first knows that a proceeding would be an appropriate means to seek to remedy an injury, loss, or damage.

[2] The appellant commenced an action for wrongful dismissal approximately six years after he was dismissed for cause by his employer, the respondent, MacEwen Petroleum ("MacEwen"). On a summary judgment motion brought by MacEwen to dismiss the action as statute-barred, the appellant submitted that he did not know if an action was the appropriate means to seek a remedy until related criminal proceedings had been resolved. The motion judge rejected the appellant's argument and dismissed the action. In so ruling, she distinguished this court's decision in Winmill v. Woodstock (Police Services Board), 2017 ONCA 962, 138 O.R. (3d) 641, leave to appeal refused, [2018] S.C.C.A. No. 39.

[3] On appeal, the appellant submits that the motion judge erred in distinguishing Winmill and in finding that he knew before the completion of the criminal proceeding that litigation was the appropriate means to seek redress. These reasons explain why I would dismiss the appeal.

Facts

[4] The appellant began working as a fuel delivery truck driver for MacEwen in 1996. In November 2009, MacEwen received an anonymous tip that one of its drivers was involved in the theft of its fuel. It began an internal investigation that ultimately found that the appellant had committed several acts of theft.

[5] On November 9, 2009, MacEwen terminated the appellant for cause. That day, the appellant retained counsel, the respondent Richard Bourdeau, who requested further details from MacEwen regarding the appellant's termination. On May 6, 2010, the appellant retained a second lawyer who wrote to MacEwen in May and June of 2010, asserting that the appellant had been wrongfully dismissed and was entitled to damages. The appellant did not commence an action for wrongful dismissal at that time.

[6] The appellant was criminally charged on July 7, 2010, and convicted on August 15, 2011, of three counts of theft and three counts of fraud. He appealed his convictions, and this court acquitted him on all counts on November 26, 2014. The appellant commenced an action for wrongful dismissal against MacEwen and in negligence against Mr. Bourdeau on July 24, 2015.[1]

[7] MacEwen brought a motion for summary judgment on the basis that the Limitations Act barred the appellant's action. The motion hinged on whether the appellant knew that it was appropriate, for the purposes of s. 5(1)(a)(iv) of the Limitations Act, to commence a civil proceeding. The motion judge rejected the argument that the appellant did not know it was appropriate until the criminal proceedings had concluded. She found that the appellant knew, or with reasonable diligence ought to have known, that he had a claim against MacEwen at the time of his dismissal on November 9, 2009.

[8] The appellant submits that until the criminal proceedings were completed, he did not know if he had a viable claim. If he were ultimately convicted, his claim for wrongful dismissal would have had little chance of success because it would have been proven beyond a reasonable doubt that he had committed multiple thefts against his employer. Therefore, according to the appellant, it made sense to await the outcome of the criminal proceeding before deciding whether to commence his action.

Analysis

[9] In considering the appellant's argument, I will review the origins of the current Limitations Act, the jurisprudence regarding the appropriate means provision, and this court's decision in Winmill. I will then apply the relevant legal principles to this case.

(i) The Limitations Act

[10] In 1969, the Ontario Law Reform Commission in its Report on Limitation of Actions said the following about Ontario's law of limitations at that time, at p. 7:

To the lawyer, Ontario's limitation laws are, at the very least, perplexing. They introduce an element of hazard into the practice of law which is quite unnecessary.

To the ordinary citizen, these laws are beyond comprehension. It is he, of course, who really suffers in their application.

[11] There was widespread acknowledgement in the civil bar even then that reform of Ontario's limitations law was long overdue. The patchwork of various limitations and the lack of uniformity in how they were interpreted resulted in uncertainty both for the bar and the public. Over the course of the next 30 years, successive Ontario governments made efforts to reform the law. After many starts and stops, in 2002, the current Limitations Act was passed in the provincial legislature. It was heralded as a significant reform of the existing law of limitations. It was hoped that the new legislation would reduce the number of limitations-related motions and negligence claims against lawyers by bringing certainty and consistency to this area of the law.[2]

[12] Two of the most significant changes in the new Limitations Act were found in ss. 4 and 5. Section 4 introduced a new basic limitation period of two years:

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.

[13] In s. 5, the legislature attempted to codify the existing jurisprudence on the discoverability of claims and added a new factor to the discoverability analysis. That section reads as follows:

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,

(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). [Emphasis added.]

[14] The new factor was the appropriateness of bringing an action. It was not an element of the previous iteration of the Limitations Act or the common law discoverability rule. It is the interpretation of s. 5(1)(a)(iv) that is determinative of this appeal and to which I will next turn.

(ii) Subsection 5(1)(a)(iv) Jurisprudence

[15] This court's jurisprudence has developed certain principles for the interpretation and application of s. 5(1)(a)(iv).

[16] First, the determination of whether a proceeding is an appropriate means to seek to remedy an injury, loss, or damage depends upon the specific factual and/or statutory setting of each case: Nasr Hospitality Services Inc. v. Intact Insurance, 2018 ONCA 725, 142 O.R. (3d) 561, at para. 46.

[17] Second, this court has observed that two circumstances most often delay the date on which a claim is discovered under this subsection. The first is when the plaintiff relied on the defendant's superior knowledge and expertise, especially where the defendant took steps to ameliorate the loss. The other situation is where an alternative dispute resolution process offers an adequate remedy, and it has not been completed: Nasr, at para. 50.

[18] Third, Sharpe J.A. in Markel Insurance Company of Canada v. ING Insurance Company of Canada, 2012 ONCA 218, 109 O.R. (3d) 652, at para. 34, provided the following guidance concerning the meaning of the term "appropriate":

This brings me to the question of when it would be "appropriate" to bring a proceeding within the meaning of s. 5(1)(a)(iv) of the Limitations Act. Here as well, I fully accept that parties should be discouraged from rushing to litigation or arbitration and encouraged to discuss and negotiate claims. In my view, when s. 5(1)(a)(iv) states that a claim is "discovered" only when "having a regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it," the word "appropriate" must mean legally appropriate. To give "appropriate" an evaluative gloss allowing a party to delay the commencement of proceedings for some tactical or other reason beyond two years from the date the claim is fully ripened and requiring the court to assess the tone and tenor of communications in search of a clear denial would, in my opinion, inject an unacceptable element of uncertainty into the law of limitation of actions. [Emphasis in original.]

[19] In other words, appropriate means whether it is legally appropriate to bring an action. Appropriate does not include an evaluation of whether a civil proceeding will succeed.

(iii) Winmill

[20] Winmill concerned an appellant who was involved in a physical altercation with the police. He was charged with assaulting a police officer and resisting arrest but was eventually acquitted of both charges. After his acquittals, the appellant issued a notice of action and then a statement of claim seeking damages for negligent investigation and battery.

[21] The respondents brought a motion for summary judgment to dismiss the appellant's claim on the basis that it was commenced two years and one day after the police altercation, and thus he had missed the limitation period by one day. The motion judge found that the claim for negligent investigation began to run on the date the appellant was acquitted. However, she dismissed the claim for battery because the limitation period ran from the date of the altercation with the police.

[22] In Winmill, the majority of this court found that the appellant could not determine whether it was appropriate to bring an action until he knew the outcome of the criminal proceedings. The court stated at para. 33 that "the criminal charges of assault and resisting arrest against the appellant and his tort claim of battery against the respondents are very close to being two sides of the same coin or mirror images of each other." Accordingly, the order dismissing the battery claim was set aside.

(iv) Application of Principles

[23] As noted, the determination of whether a civil proceeding is an appropriate means depends upon the specific factual and/or statutory setting of each case. In Winmill, the majority held that the civil claim and the criminal charges were two sides of the same coin. That finding was presumably made on the basis that the civil claim involved determining the appropriateness of the conduct of the police, who were also closely involved with the criminal charges. That makes Winmill distinguishable from the facts of the present case, where the police's conduct is not the subject of the civil proceeding. In my view, therefore, the motion judge did not err in distinguishing Winmill. The issue that remains is whether the motion judge otherwise erred in her analysis of s. 5(1)(a)(iv).

[24] The appellant relies on 407 ETR Concession Co. v. Day, 2016 ONCA 709, 133 O.R. (3d) 762, in support of his position. However, 407 ETR was an example of a case where an alternative administrative means of settling the dispute had not been completed. It has no application to the case at bar, where there is no alternative process.

[25] The appellant also relies on the following statement in Novak v. Bond, [1999] 1 S.C.R. 808, 63 B.C.L.R. (3d) 41, at para. 85:

Litigation is never a process to be embarked upon casually and sometimes a plaintiff's individual circumstances and interests may mean that he or she cannot reasonably bring an action at the time it first materializes. This approach makes good policy sense. To force a plaintiff to sue without having regard to his or her own circumstances may be unfair to the plaintiff and may also disserve the defendant by forcing him or her to meet an action pressed into court prematurely. [Citation omitted.]

[26] The factual and statutory context of that statement is important. Novak involved a situation where a doctor misdiagnosed a lump on the plaintiff as benign. It was later discovered that she had cancer. After undergoing surgery, it appeared that the cancer had been cured. The plaintiff considered suing her doctor at that point but decided instead to focus on her recovery and accept the diagnosis that she had fully recovered from cancer. Some years later, the cancer reoccurred, and she sued her original doctor.

[27] The case considered British Columbia's limitations legislation. Subsection 6(4)(b) of that statute provided for the postponement of the limitation period until a properly advised reasonable person would consider that the plaintiff "ought, in the person's own interests and taking the person's circumstances into account, to be able to bring an action." That, of course, is a very different provision than s. 5(1)(a)(iv). In my view, Novak does not assist the appellant because the British Columbia legislation explicitly permitted an evaluation of whether it was in the plaintiff's interests to commence a proceeding.

[28] The appellant's principal submission is that he should have been permitted to wait until the criminal proceedings concluded so that he could evaluate his chances of success in litigation. He argues that litigation is an expensive and risky proposition, and he should not have been forced to commence a civil proceeding until he knew that he had a chance of success. This argument, of course, is precisely what this court in Markel said a plaintiff is not permitted to do.

[29] If such an evaluative analysis could effectively stop the running of the limitation period, questions will necessarily follow regarding the nature of that analysis and the factors that could be considered. For example, is it open to a plaintiff to argue that he or she can await the outcome of a related discipline process in a professional negligence claim? May a potential plaintiff commence a claim many years after the events if there is a change in the law that increases his or her chances of success? If a critical witness goes missing and is later discovered, is it open to the plaintiff to assert that he or she did not know whether it was appropriate to bring an action until the witness was found?

[30] I cite these examples, not to suggest that they should succeed under the appropriate means provision, but to show how far that provision might be expanded once plaintiffs are permitted to evaluate the strength of their claim before being required to commence a proceeding. This approach would introduce a measure of uncertainty that is contrary to the legislature's intention in enacting the current Limitations Act. It would, in effect, transport the law back to the same state of uncertainty that existed before the changes in the legislation in 2002.

Disposition

[31] For the foregoing reasons, I would dismiss the appeal. The respondent is entitled to its costs of the appeal payable by the appellant, which I would fix in the agreed-upon, all-inclusive sum of $10,000.

Released: December 20, 2019

"C.W. Hourigan J.A."

"I agree. David Watt J.A."

"I agree. G.T. Trotter J.A."

Footnotes

[1] Mr. Bourdeau brought a separate motion for summary judgment. Counsel advised us that the decision on that motion is under reserve.

[2] For a discussion of the impetus behind reforming the Limitations Act, see: Graeme Mew, "Limitations Act 2002: A huge reform of existing law", LAWPRO Magazine 2:1 (March 2003), online: https://www.practicepro.ca/wp-content/uploads/2003/03/2003-02-full-article-limitations-act-2002.pdf.