Skip to content

Brought to you by

Dentons logo

Limitations Law Blog

Updates on key developments on laws involving limitation periods in Ontario.

open menu close menu

Limitations Law Blog

  • Home
  • About us

A Limitation Period is Not Automatically Extended Until Professional Advice is Obtained

By Ara Basmadjian and Nicole Tzannidakis
March 24, 2022
  • Discoverability
Share on Facebook Share on Twitter Share via email Share on LinkedIn

Introduction

In Fryday v. Pilot Insurance, 2021 ONSC 8150 (“Fryday”), the Ontario Superior Court of Justice summarily dismissed an action, which was commenced approximately 19½ years after an alleged improvident settlement of a statutory accident benefits claim and 18 years after the plaintiff was no longer a minor, as statute-barred. The decision is noteworthy as a reminder that circumstantial evidence can be used to assess a plaintiff’s level of knowledge about a potential claim and that “a limitation period does not automatically extend until a professional opinion is obtained.”

Factual Background

The plaintiff, Brock Fryday, was seriously injured in an accident in 1982. He was 14 years old at the time of the incident. The defendant, Nigel Gilby, was the lawyer retained to represent Mr. Fryday. Mr. Gilby provided Mr. Fryday with advice about the settlement of an accident benefits claim and a tort claim. Both matters were ultimately settled in 1999. Mr. Fryday, who was 17 years old at the time of the settlement, and his litigation guardian and mother, executed all settlement documents. The settlement agreements were later approved by the court.

In September 2017, Mr. Fryday sought advice from another lawyer, James Leone. Mr. Leone made inquiries of the accident benefits claim and advised Mr. Fryday that he had a claim in negligence against Mr. Gilby on the basis that the accident benefits settlement was improvident.

By statement of claim issued on December 17, 2018, Mr. Fryday commenced an action against Mr. Gilby and his law firm seeking damages for apparently giving up access to various statutory accident benefits. Mr. Gilby and his firm brought a motion for summary judgment to dismiss the action as statute-barred under the Limitations Act, 2002, SO 2002, c 24, Sch B (the “Limitations Act”).

Circumstantial Evidence and Plausible Inferences of Liability

Section 4 of the Limitations Act states that “[u]nless 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.”

Section 5 of the Limitations Act sets out the scheme for determining when a claim is discovered. It provides, in relevant part, as follows:

Discovery

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).

Faced with a motion for summary judgment, Mr. Fryday was required to “put his best foot forward” and prove that his claim was not time-barred. The evidence before the court was that Mr. Fryday never considered whether he had been properly advised by Mr. Gilby until he received advice from Mr. Leone in September 2017. As Justice Sproat recognized, a limitation period is not suspended until an individual obtains legal advice.

In Grant Thornton LLP v. New Brunswick, 2021 SCC 31, the Supreme Court of Canada held that “[i]n assessing the plaintiff’s state of knowledge, both direct and circumstantial evidence can be used.” Indeed, “the governing standard requires the plaintiff to be able to draw a plausible inference of liability on the part of the defendant from the material facts that are actually or constructively known.”

According to Justice Sproat: “If there was any significant shortfall between Fryday’s income and accident benefits for goods and services I infer and find that he would have been aware of it. Certainly, a reasonable person would have been aware of it. Neither Fryday nor a reasonable person would need a lawyer to tell him that his income was inadequate to meet his needs.” Justice Sproat determined that “a plausible inference of liability” could have been made within five years of the 1999 accident benefits settlement. As such, the court granted summary judgment and dismissed the action as statute-barred under both section 5(1)(a) and section 5(1)(b) of the Limitations Act.

Comment

Litigants in Ontario should be aware of the decision in Fryday which demonstrates the court’s willingness to use circumstantial evidence and common sense to draw a plausible inference of liability on the part of a defendant thereby starting the limitations clock. A plaintiff who is faced with an obvious limitations issue, as in Fryday, must be prepared to tender evidence that would be relevant to the court’s section 5(1) analysis or risk that his or her action will be summarily dismissed. A limitation period is not automatically suspended until a legal opinion is obtained.

Share on Facebook Share on Twitter Share via email Share on LinkedIn
Subscribe and stay updated
Receive our latest blog posts by email.
Stay in Touch
Ara Basmadjian

About Ara Basmadjian

Ara Basmadjian is a Partner in the Litigation and Dispute Resolution group at Dentons Canada LLP. His practice involves a variety of complex corporate, commercial and civil litigation matters. Ara has particular experience in cases involving commercial contracts, negligence, product liability, class actions, competition law, cannabis in Canada, and extraordinary remedies, such as injunctions.

All posts Full bio

Nicole Tzannidakis

About Nicole Tzannidakis

Nicole Tzannidakis is an associate in the Litigation & Dispute Resolution group of the Dentons Toronto office. Her experience includes advising clients on a broad variety of litigation and arbitration matters, with a focus on corporate and commercial disputes.

All posts

RELATED POSTS

  • Discoverability

Duchesne v. St. Denis, 2012 ONCA 699 (Discoverability, s. 5)

By Dentons Limitations Law Group
  • Discoverability

CJSC “Sankokr-Moskva” v. Tradeoil Management Inc., 2013 ONSC 7487 (limitation period to amend statement of claim)

By Dentons Limitations Law Group
  • Contribution and Indemnity
  • Discoverability

Court of Appeal for Ontario Addresses Actual and Constructive Knowledge of Claims for Contribution and Indemnity

By Ara Basmadjian and Barbara Grossman

About Dentons

Dentons is designed to be different. As the world’s largest law firm with 20,000 professionals in over 200 locations in more than 80 countries, we can help you grow, protect, operate and finance your business. Our polycentric and purpose-driven approach, together with our commitment to inclusion, diversity, equity and ESG, ensures we challenge the status quo to stay focused on what matters most to you. www.dentons.com

Dentons boilerplate image

Twitter

Categories

  • Acknowledgment
  • Adding a Party
  • Amending Pleadings
  • Attempted Resolution
  • Contribution and Indemnity
  • COVID-19
  • Demand Obligations
  • Discoverability
  • Enforcement of Foreign Judgments
  • General
  • Limitation Periods contained in "Other Acts"
  • Limitation Periods in Federal Court
  • Misnomer
  • Motions to Strike
  • Notable cases in other provinces
  • Special Circumstances
  • Statutory Variation of Time Limits
  • Successors
  • Tolling/Varying Agreements
  • Transitional Provisions
  • Ultimate Limitation Periods

Subscribe and stay updated

Receive our latest blog posts by email.

Stay in Touch

Dentons logo

© 2023 Dentons

  • Legal notices
  • Privacy policy
  • Terms of use
  • Cookies on this site