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

Acknowledgments of Indebtedness in a Digital World

By Ara Basmadjian
June 23, 2021
  • Acknowledgment
Share on Facebook Share on Twitter Share via email Share on LinkedIn

Section 13(1) of the Limitations Act, 2002, SO 2002, c 24, Sch B (the “Act”) provides for the extension of the commencement date of a limitation period in relation to a claim for liquidated damages where an acknowledgment of the indebtedness is made. Under section 13(10) of the Act, however, an acknowledgment is not effective unless it is “in writing and signed by the person making it or the person’s agent.” Does an acknowledgment have to be “signed” in the traditional sense?

In 1475182 Ontario Inc. o/a Edges Contracting v. Ghotbi, 2021 ONSC 3477 (“Ghotbi”), the Divisional Court adopted a purposive approach to the signature requirement of section 13(10) of the Act based on concerns about authenticity. Justice Boswell determined that section 13(10) does not prescribe any particular type of signature and therefore the acknowledgment of a debt through a text message sent by a cellular telephone with a unique telephone number provides, in effect, a digital signature that is appropriate to meet the requirements of the Act.

According to Justice Boswell: “The world is changing. Everyone knows that. We live in a digital world now, much more than was the case when the Act came into force in 2002. It is incumbent upon the court to consider not just traditional means of affixing one’s signature to a document, but other, more modern means, including digital signatures.”

On the facts, there was no question about the authenticity of the text message acknowledging liability for payment of the liquidated sum. Accordingly, the underlying purpose of section 13(10) of the Act was satisfied. Justice Boswell went on to find that the signature requirement had been met through digital means:

I would also find that the express requirement of a signature is met in this case.  Dr. Ghotbi used his cellular telephone to send and receive texts with Mr. Lupo. Dr. Ghotbi, like all other cellular telephone users, has a unique phone number linked with his phone. In fact, there will undoubtedly be other unique identifiers associated with Dr. Ghotbi’s phone including, without limitation, an International Mobile Equipment Identifier (IMEI) number. These unique identifiers provide, in effect, a digital signature on every message sent by the user of that particular device. Again, there is no dispute that the user of the device was Dr. Ghotbi and that he sent the texts in issue. In my view, that digital signature is sufficient to meet the requirements of s. 13(10) of the Act.

Ghotbi is an important decision recognizing the realities of the modern world and confirming that an acknowledgment of liability in respect of a claim for payment of a liquidated sum can be in a text message provided that there are no legitimate concerns about the authenticity of the debtor’s acknowledgment.

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

RELATED POSTS

  • Acknowledgment
  • Discoverability

Emails can satisfy the acknowledgement requirement and Forbearance can postpone discoverability of a claim

By Dentons Limitations Law Group

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