Yet Another Reason Not to Sit on Your Rights

January 23, 2022

By Brian Babcock

We have written before, more than once, about why waiting until the last moment to start your lawsuit is a bad idea.

And yet, there are still new examples of how the time limit may be missed.

These cases do not necessarily just involve small losses, or unsophisticated clients.

This week’s example, Gordon Dunk Farms Limited v. HFH  may appear to involve a family farm suing to recover losses due to a barn collapse, but that family farm is backed by an insurance company which paid off some of the loss. Insurers pretty much fit the definition of sophisticated clients.

The barn collapsed on May 6, 2014. The insurer hired two engineers to examine the cause of the collapse on May 8th. Both provided preliminary reports the same day. The final report was provided May 21.

Both Gordon Dunk and his son acknowledged that they had experience and understanding of barn construction and believed that they understood the cause of the collapse, even though Gordon did not see the expert report until 2019.

Now here’s where the facts get tricky – the action was not commenced until May 24, 2016.

You may recall from previously articles that the general time limit in Ontario to start an action is two years from when you know, or ought to have known, that you have a claim. A claim means a potential right to a remedy for your loss or damage.

So when do you have enough knowledge?

The Plaintiffs alleged that they could not know until they had received and reviewed the expert report. They convinced a motions judge of this argument

Then, while the appeal was pending, the Supreme Court of Canada in a case from New Brunswick considered that issue, and clarified that: “[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.”

Ontario and New Brunswick use the same definition of a claim.

The reference to “plausible inference” is important – it means that you do not need to be certain that you will succeed in your claim, because no one is ever certain until after judgment, and after all appeals are complete.

The Court of Appeal adds to this by clarifying that you need not know the exact cause of the loss. You merely need to know that an incident has occurred that that resulted in you having a loss; that the defendant was involved in the loss in a way that their acts or omission might have caused the loss; and that a court action is the appropriate means to seek a remedy.

The court uses the example of a car accident. You may know you were injured when struck by the other vehicle, but not be aware whether that was because their brakes failed or they were distracted. Your time for a claim starts before you learn those specifics.

So in the Dunk case, the evidence of Gordon and his son established that soon after the collapse, by May 12, 2014, they knew that an error by one or more of the defendants had caused the barn to collapse. That started the time running. The claim filed on May 24, 2016 was out of time.

The law of limitations is subtle, but it is also fact driven. The Dunks and their insurer were also caught by the clarification of the law after they started their claim.

Because protecting your rights requires a review of the facts and sometimes the law, if you have suffered a loss, even if you are not sure that you have a claim, make an appointment to meet with us in Thunder Bay, Nipigon, via Zoom, or perhaps on your premises. Give us the time to protect your rights by not sleeping on your rights.