The Supreme Court of Canada recently rendered a decision setting out when the running of a two year general limitation begins. Grant Thornton LLP v. New Brunswick, 2021 SCC 31 (CanLII) was a case out of New Brunswick based on that Province’s Limitations of Actions Act.
Given the importance of starting a proceeding within the limitation period and given the number of claims we see each year that arise from missing the limitation, we would recommend this decision for your summer reading list.
But asking you to read it is not the reason for this note. Rather it is another point we often make, that when dealing with laws of other jurisdictions, one should not assume that the laws of that other jurisdiction are the same as ours.
The relevant provisions of the New Brunswick Act relied on in Grant Thornton are:
Definitions and interpretation
1(1) The following definitions apply in this Act.
“claim” means a claim to remedy the injury, loss or damage that occurred as a result of an act or omission.
General limitation periods
5(1) Unless otherwise provided in this Act, no claim shall be brought after the earlier of
(a) two years from the day on which the claim is discovered, and
(b) fifteen years from the day on which the act or omission on which the claim is based occurred.
5(2) A claim is discovered on the day on which the claimant first knew or ought reasonably to have known
(a) that the injury, loss or damage had occurred,
(b) that the injury, loss or damage was caused by or contributed to by an act or omission, and
(c) that the act or omission was that of the defendant.
In the interest of brevity, from the Supreme Court decision’s headnote:
In order to properly set the standard, two distinct inquiries are required. The first inquiry asks whether, in determining if a statutory limitation period has been triggered, the plaintiff’s state of knowledge is to be assessed in the same manner as the common law rule of discoverability. Under that rule, a cause of action arises for purposes of a limitation period when the material facts on which it is based have been discovered or ought to have been discovered by the plaintiff by the exercise of reasonable diligence. The common law rule of discoverability does not apply to every statutory limitation period. Rather, it is an interpretive tool for construing limitations statutes and, as such, it can be ousted by clear legislative language. Assessing whether a legislature has codified, limited or ousted the common law rule is a matter of statutory interpretation. Section 5(1)(a) and (2) of the LAA does not contain any language ousting or limiting the common law rule; rather, it codifies it… Accordingly, as established by the rule of discoverability and the LAA, the limitation period is triggered when the plaintiff discovers or ought to have discovered, through the exercise of reasonable diligence, the material facts on which the claim is based.
The second inquiry relates to the particular degree of knowledge required to discover a claim. A claim is discovered when a plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendant’s part can be drawn. This approach remains faithful to the common law rule of discoverability, which recognizes that it is unfair to deprive a plaintiff from bringing a claim before it can reasonably be expected to know the claim exists… A plausible inference of liability is enough; it strikes the equitable balance of interests that the common law rule of discoverability seeks to achieve.
The material facts that must be actually or constructively known are generally set out in the limitation statute. In the [Act], they are listed in s. 5(2)(a) to (c). A claim is discovered when the plaintiff has actual or constructive knowledge that: (a) the injury, loss or damage occurred; (b) the injury loss or damage was caused by or contributed to by an act or omission; and (c) the act or omission was that of the defendant. This list is cumulative.
Turning to Nova Scotia’s Limitations of Actions Act, the definition of claim set out in Section 2(1)(a) is the same as that found in the New Brunswick Act. As to the general rule, Section 8 of the Nova Scotia Limitations of Actions Act is very similar to the New Brunswick Act. But it is not identical:
General rules
8 (1) Unless otherwise provided in this Act, a claim may not be brought after the earlier of
(a) two years from the day on which the claim is discovered; and
(b) fifteen years from the day on which the act or omission on which the claim is based occurred.
(2) A claim is discovered on the day on which the claimant first knew or ought reasonably to have know
(a) that the injury, loss or damage had occurred;
(b) that the injury, loss or damage was caused by or contributed to by an act or omission;
(c) that the act or omission was that of the defendant; and
(d) that the injury, loss or damage is sufficiently serious to warrant a proceeding.
Section 8(2)(d) is not found in the New Brunswick Act.
In Grant Thornton, the Supreme Court said that the list of factors that determine when the claim is discovered is as set out in Section 5(2) of the New Brunswick Act (the equivalent of Section 8(2) of the Nova Scotia Act) and that the list is cumulative.
So it would seem that here, there is an additional factor to the analysis.
Would this factor have changed the Grant Thornton decision? Who knows. And as to an interpretation of Section 8(2)(d), we only found two cases - R.P. Anaka Properties Inc. v. 302186 Nova Scotia Limited, 2021 NSSC 218 (CanLII) and Keleher v. Nova Scotia (Attorney General), 2019 NSSC 375 (CanLII). But this section may present an additional argument in this Province that was not available to New Brunswick in its case.