Court File and Parties

COURT FILE NO.: CV-19-00003994 DATE: 2023-02-08 SUPERIOR COURT OF JUSTICE - ONTARIO

RE: Richard Karan, Plaintiff AND: 2038815 Ontario Business Corporation and The Corporation of the City of Mississauga, Defendants

BEFORE: Kurz J.

COUNSEL: Kay Wu, Student at Law, for the Plaintiff Jennifer Bruce, for the Proposed Defendant, The Regional Municipality of Peel

HEARD: February 6, 2023

ENDORSEMENT

Introduction

[1] The Plaintiff moves to amend its Statement of Claim to add the Regional Municipality of Peel (“Peel”) as a Defendant to this action. It seeks to do so despite the fact that more than two years have passed since the slip and fall accident that is the subject of this action. The Plaintiff argues that the ordinary two-year limitation period should be extended because he gave Peel notice of his claim less than a month after the subject accident but was told by Peel that it was not legally responsible for the portion of sidewalk where the accident occurred. Peel’s employee advised the Plaintiff’s counsel to make his claim against the City of Mississauga (the “City”) instead, asserting that it was the responsible government entity. The Plaintiff says that only after he commenced this action did he learn from the City that Peel is in fact responsible for the location of his accident.

[2] Thus, the Plaintiff argues, by relying on the information provided by Peel, the claim was not discoverable until shortly before he brought this motion. Prior to that date, he was misled by Peel’s representations. The early notice of the claim to Peel means that it will not be prejudiced by the timing of the amendment adding it as a party. In any event, any limitation issue should be dealt with at trial.

[3] Peel opposes the motion. It argues that the request to add it as a party is limitation barred. Further, the Plaintiff fails to meet the test for adding a party to an action after the expiry of a limitation period. Peel says that the advice of the City, as reported by the Plaintiff is erroneous; it is not legally responsible for the subject sidewalk. But in any event, the Plaintiff’s former counsel, who provided it with the notice of his claim, failed to act with due diligence. Peel’s jurisdiction (or non- jurisdiction) for the location of the slip and fall was easily discoverable. Further, any litigation commenced against a party after the expiry of a limitation date is prima facie prejudicial.

[4] For the reasons set out below, I allow the amendments and the addition of Peel. That order is without prejudice to any limitation defence that Peel may wish to raise in response to the Plaintiff’s claims against it, whether in its pleadings, at trial or otherwise.

Background

[5] The Plaintiff pleads that he suffered a slip and fall accident on September 28, 2017, while walking on a sidewalk at or near 101 The Queensway West, Mississauga (the “Sidewalk”). He says that the accident was caused by a collapsed retaining wall block hazardously protruding onto the Sidewalk.

[6] Less than a month later, on October 23, 2017, former counsel for the Plaintiff (“Former Counsel”) served a Notice of Claim on Peel. In that notice, Former Counsel erroneously referred to the site of the accident as 100 The Queensway West, Mississauga, which is across the street from the actual location of the accident. Counsel for Peel concedes that little turns on the distinction, since Peel’s jurisdiction (or non-jurisdiction) is equal on the sidewalks in front of the two locations.

[7] Former Counsel engaged in email correspondence with Michelle DeSantis, a claims analyst for Peel. Ms. DeSantis asserted more than once that the subject location of the accident was not within the jurisdiction of Peel. Rather, it was within the jurisdiction of the City of Mississauga (the “City”). For example, she wrote on April 15, 2018:

The Region of Peel and the City of Mississauga are two different entities. The Region is the upper government tier. The City maintains the sidewalks, and while the actual road (asphalt area) is a Region road, there is a maintenance agreement in place whereby the City inspects and maintains the road as well. But as this incident occurred on the sidewalk, that is entirely the City of Mississauga’s jurisdiction. If the sidewalk in question is not private (owned or maintained by the owner of 100 The Queensway, ) then it would fall to the City of Mississauga for inspections and maintenance. You can contact the City directly at: City of Mississauga, 300 Centre Dr., Mississauga, ON, L5B 3C1 or submit your notice electronically to risk.management@mississauga.ca.

[Emphasis added.]

[8] The Plaintiff issued his Statement of Claim on September 26, 2019. In accord with the representations of Ms. DeSantis for Peel, he sued the City but not Peel. In response to the Statement of Claim, counsel for the City wrote to counsel for the Plaintiff, asserting the position that it was Peel, not the City, that has jurisdiction over the subject sidewalk. The City’s counsel pointed to two by-laws passed by Peel which, the Plaintiff says, established it as a co-owner of the area that is the site of the accident and responsible for its maintenance.

[9] Former Counsel and any representative of Peel did not communicate at any time between April 17, 2018 and the date that the record for this motion was served, March 11, 2022.

Issues

[10] This Motion raises the following issues:

1. Does this court have the jurisdiction to add Peel as a party after the expiry of the applicable limitations period?
2. If the limitation period for this action has passed, should the court nonetheless allow the Peel to be added as a part and the statement of claim to be amended?

Issue No. 1: Does this court have the jurisdiction to add Peel as a party after the expiry of the applicable limitations period?

[11] Rule 5.03 of the Rules of Civil Procedure states that “every person whose presence is necessary to enable to court to adjudicate effectively and completely on the issues in a proceeding shall be joined as a party to the proceeding.”

[12] Rule 5.04(2) allows a court to add a party at any stage of a proceeding on such terms as are just unless prejudice would result that could not be compensated for with costs or an adjournment.

[13] Rule 26.01 allows a court, on motion to grant leave to amend a pleading on such terms as are just, unless prejudice would result that could not be compensated for with costs or an adjournment.

[14] Thus, it is open to the court to add a party and amend a pleading to allow a claim at any stage. However, the issue is whether a limitation period bars that addition and amendment.

Issue No. 2: If the limitation period for this action has passed, should the court nonetheless allow the Peel to be added as a part and the statement of claim to be amended?

[15] Under the Limitations Act, 2002, SO 2002, c. 24, Sched. B, s. 2, the basic limitation period expires on the second anniversary of the day on which the claim was discovered

[16] Under s. 5(1), the date that a claim is discovered is defined as follows:

(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). 2002, c. 24, Sched. B, s. 5 (1).

[17] Under s. 5(2), “[a] person with a claim shall be presumed to have known of the matters referred to in clause (1) (a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.”

[18] Under s. 21(2), “[i]f 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.” In Arcari v. Dawson, 2016 ONCA 715, at para. 7, leave to appeal to S.C.C. refused [2016] S.C.C.A. No. 522, the Court of Appeal for Ontario stated that the effect of s. 21(2) is that “the clear expiration of a limitation period is an absolute bar to the addition of a party to an already existing action". It added that “[s]ubject to the statutory exceptions from the general rule … that bar arises immediately after the second anniversary of the day the claim was discovered (s. 4).”

[19] The test to add a party after the ostensible expiry of a limitation period is a two-part one, as set out by the Court of Appeal for Ontario in Morrison v. Barzo, 2018 ONCA 979, at para. 31 – 33 as follows:

[31] The evidentiary burden on a plaintiff seeking to add a defendant to an action after the apparent expiry of a limitation period is two-fold. First, the plaintiff must overcome the presumption in s. 5(2) that he or she knew of the matters referred to in s. 5(1)(a) on the day the act or omission on which the claim is based took place, by leading evidence as to the date the claim was actually discovered (which evidence can be tested and contradicted by the proposed defendant). The presumption is displaced by the court's finding as to when the plaintiff subjectively knew he had a claim against the defendants: Mancinelli, at para. 18. To overcome the presumption, the plaintiff needs to prove only that the actual discovery of the claim was not on the date the events giving rise to the claim took place. It is therefore wrong to say that a plaintiff has an onus to show due diligence to rebut the presumption under s. 5(2): Fennell, at para. 26.

[32] Second, the plaintiff must offer a "reasonable explanation on proper evidence" as to why the claim could not have been discovered through the exercise of reasonable diligence. The evidentiary threshold here is low, and the plaintiff's explanation should be given a "generous reading", and considered in the context of the claim: Mancinelli, at paras. 20 and 24.

[Emphasis added]

[20] In a nutshell, the Plaintiff must 1) lead evidence showing that he or she first learned of the matters upon which the claim is based after the limitation period expired and when that occurred. That will overcome the s. 5(2) presumption. Second the Plaintiff must meet the low evidentiary burden of offering a reasonable explanation for the delay, demonstrating that the claim could not have been discovered before the expiry of the limitation period.

[21] Looking to the second element of the test, the court in Zieppeiri v Shahid, 2021 ONSC 2858, stated that the evidence required to meet the due diligence test is “not very much” and will usually involve a list of steps taken to identify the tortfeasor and a reasonable explanation as to why such information was not available.

[22] In Morrison v. Barzo, the court was candid in stating that the question of the date of reasonable discovery may not be capable of determination on a motion such as this. In that event, “the motion to add the defendant should be granted, with leave for the defendant to plead a limitation defence”.

Analysis

[23] Here the Plaintiff gave notice to Peel of his claim well within the two-year limitation period: in fact within less than a month. Arguably he was aware of the potential liability of Peel at that time. But he was disabused of that notion by Peel. Being so informed by Peel, he was arguably unaware of Peel’s potential liability to him for about 23 of the 24 months following his accident. Recall that it is not necessary to prove the Plaintiff’s due diligence in this regard. It is only necessary to prove that the actual discovery of the claim was not on the date the events giving rise to the claim took place, but rather after the expiry of the limitation period. I find that he has done so here.

[24] Moving to the second portion of the test, I have considered the evidence generously and in light of the low bar that Morrison v. Barzo directs this court to apply. I find that the Plaintiff has offered what appears to be a reasonable explanation on proper evidence as to the Plaintiff’s failure to discover that it had a claim against Peel. The Plaintiff, through his counsel, was arguably disabused of the notion that Peel was responsible for the maintenance of the sidewalk at the time of the accident. Having offered that representation more than once, it can easily be argued that it hardly lies in the metaphorical mouth of Peel to argue that reliance on its own representation is a breach of due diligence.

[25] Peel argues that proof of a want of due diligence is that the Plaintiff did not attempt to discover the name of the owner of the retaining wall (not Peel), whose fall on the Sidewalk was a contributing factor to his accident. But that argument is a “red herring”. It may be relevant to an argument relating to the late addition of that owner to this action. But it is not relevant to the issue of the addition of Peel as a party to this action.

[26] Turning to the issue of prejudice, Peel argues that any amendment to a statement of claim adding a party after the expiry of a limitation period is a form of non-compensable prejudice: Klassen v. Beausoleil, 2019 ONCA 407, at para. 26. But as the court stated in the same decision, at para. 33:

Irrespective of the form of prejudice alleged, there must be a causal connection between the non-compensable prejudice and the amendment. The prejudice must flow from the amendment and not from some other source.

[27] Here, there is no evidence of any non-compensable prejudice other than the delay itself. However, Peel has offered no evidence of how that delay will affect its ability to defend the Plaintiff’s claim. That evidentiary shortcoming is more pronounced when one considers the fact that Peel had actual notice of the Plaintiff’s claim within a month of the subject accident. Further, it is hard for Peel to point to its prejudice from the timing of the relief sought here when the evidence points to it playing a part in that timing.

[28] For the reasons cited above, I allow the amendment requested, including the addition of Peel as a party to the action. I also grant leave to Peel to plead a limitation defence to this action.

Costs

[29] The Plaintiff was the successful party and thus presumptively entitled to costs. But the order I grant is an indulgence. In light of the fact that this motion was necessitated by the failure to add Peel as a party when this action was commenced, there are no costs of this motion.

“Marvin Kurz J.”

Electronic signature of Justice Marvin Kurz

Date: February 8, 2023