Limitation periods in Ontario

The ongoing impact of COVID-19

Limitation periods in Ontario
Brittany Taylor

Since the pandemic began in March 2020, we have seen governments across Canada enact extraordinary legal measures to try and help stop the spread of COVID-19 and provide support to Canadians.

One of the many initiatives undertaken by several provinces has been with respect to the suspension of limitation periods, which establish the time limits within which a plaintiff must pursue a claim before the action is “out of time.”

In Ontario, the government temporarily suspended the running of all limitation periods as of March 16, 2020 pursuant to a regulation under the Emergency Management and Civil Protection Act. Limitation periods began running again on Sept 14, 2020, when the regulation was revoked.

The regulation expressly states that “any limitation period or period of time within which a step must be taken in a proceeding that is temporarily suspended under this regulation resumes running on the date on which the temporary suspension ends and the temporary suspension period shall not be counted.”

This means that for a period of about six months, or exactly 26 weeks, the clock was stopped on limitation periods. For example, if an individual had a claim that would have expired during the “freeze” period, such as on July 1, 2020, the claim would not actually expire until Dec. 30, 2020.

Similarly, if an individual discovered they had a claim during the freeze period (for example, an employee who was constructively dismissed on Aug. 15, 2020), the limitation period would not actually start running until the suspension was lifted on Sept. 14, 2020. As a result, this individual’s limitation period would not end until Sept. 14, 2022.

Despite the relatively plain wording of the regulation, once it was revoked, some doubts were raised as to whether the 26-week suspension period should or should not be counted towards limitation periods. As a result of this potential confusion, the Attorney General for Ontario, along with several intervenors, brought an application before the Ontario Superior Court of Justice seeking a declaration clarifying that the six-month period of the temporary suspension was not to be counted in the calculation of limitation periods.

The decision of the Superior Court of Justice
The court declined to issue the relief requested.

It is important to understand that this refusal was not a comment on the Attorney General’s interpretation of the practical effect of the suspension period, but based on the fact that the application did not satisfy the four-part test for declaratory relief:

  • the court has jurisdiction to hear the issue
  • the dispute is real and not theoretical
  • the party raising the issue has a genuine interest in its resolution
  • the responding party has an interest in opposing the declaration being sought.

The court found that only the first of the four factors was satisfied. In particular, the court noted that the second factor was not fulfilled as there was no evidence of “the nature of the confusion, the arguments that may be advanced in various scenarios, or the prejudice allegedly being suffered by anyone.”

In short, the court concluded that it was not necessary or appropriate to grant the declaratory relief sought.

Impact of the court’s decision
Despite the fact that the application was denied, the decision is still quite helpful. Justice Frederick Myers’ analysis suggests he was supportive of the attorney general’s position. He notes “I am not satisfied that there is a dispute. I have yet to hear anyone hint at a basis to argue that the repeal of O. Reg. 73/20 undermines the six-month suspension” and points out that the Legislation Act, 2006 expressly states that “the… revocation of a regulation does not... (a) affect the previous operation of the repealed or revoked… regulation.”

Further, despite the application being advertised, not a single interested party came forward to oppose the declaration requested. Myers noted this in his decision, stating “There is no admissible evidence of a single person having read the various regulations and statutes and forming a considered legal opinion that is contrary to the interpretation unanimously advanced by the attorney general, the intervenors, and the legal community supporting them.”

Although we do not have a decision from the court confirming that limitation periods are extended by six months, Myers’ comments seem to suggest this is the correct legal interpretation of the legislation. Even so, it is likely that counsel who have the option to do so will continue to file claims prior to the expiry of the “original” limitation period to be cautious.

If you suspect you may have a potential action against a current or former employer, it is always best to contact legal counsel as soon as possible to ensure you do not prejudice your ability to pursue legal action. However, employees who have a potential claim with a limitation period that is expiring soon, or which may have already expired, should not assume they are out of time, as they may have longer than anticipated to proceed.

Similarly, employers should be alert to the fact that employees may have more time to pursue a claim against them relating to their employment.

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