COVID-19: Limitations Need Not Apply
Mar 25, 2020
Amongst all the chaos and uncertainty that has reigned over the past few weeks, one question which keeps coming up with lawyers and our clients is "What happens to limitation periods?"
Under the basic limitation period prescribed in the Limitations Act, 2002, a party has two years to commence a claim from the event giving rise to the action. This time can be tolled in certain circumstances or expanded based on discovery. However, the Courts effectively closed as of March 17, 2020, thereby creating uncertainty with respect to claims which may have limitation periods which will expire over the next few weeks.
The Superior Court of Ontario issued a guideline to the COVID-19 crisis on March 15, 2020 and anticipated that it may be become impossible to file documents and noted that "parties can expect the Court to grant extensions of time once the Court’s normal operations resume." It also recommend that that parties file Statements of Claim electronically.
On March 20, 2020 a regulation went further and made it clear that COVID-19 was changing the regular practice of law within Ontario for the immediate future.
An Ontario regulation pursuant to s. 7.1(2) of the Emergency Management and Civil Protection Act ("EMCPA") came into effect on March 20, 2020 which suspends the limitation period:
- Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any limitation period shall be suspended for the duration of the emergency, and the suspension shall be retroactive to Monday, March 16, 2020.
The EMCPA clarifies that the limitation period will resume running on the date on which the suspension ends and the duration of the suspension would not be counted.
However, the regulation goes further than just suspending limitation periods, it also suspends other litigation deadlines:
- Any provision of any statute, regulation, rule, by-law or order of the Government of Ontario establishing any period of time within which any step must be taken in any proceeding in Ontario, including any intended proceeding, shall, subject to the discretion of the Court, tribunal, or other decision-maker responsible for the proceeding, be suspended for the duration of the emergency, and the suspension shall be retroactive to Monday, March 16, 2020.
This provision would include routine deadlines within the Rules (filing pleadings, etc). Practically, this ensures that no party is punished for missing a step beyond their control. However, some discretion is left with judicial decision maker.
Of note, the Regulation is silent as to deadlines imposed on agreement between the parties. We suspect that while it would depend on the deadline, the Courts will generally exercise discretion and follow the example set in the Regulation of excusing missed steps. Practically, if a party were to fail to miss a deadline set in the timetable, such as attending a discovery, the Court will likely excuse such a delay in light of the circumstances. However, if the party has missed several steps over an extended period of time, the Court would likely consider the larger pattern when faced with a motion to dismiss for failure to comply with a Court Order.
Of further note, this Regulation only deals with limitation periods or steps under provincial legislation, so federal limitations and deadlines would be unaffected. The federal government has not enacted any similar legislation as of this time.
This provincial regulation applies to all Ontario statutes, regulations, by-laws and rules. For those of us accustomed to practicing in insurance, this would include timelines imposed by not only the Limitations Act, but also the Insurance Act, the SABS, by the LAT Act, and by the Dispute Between Insurers regulation.
Further, the one area not affected by this regulation are time lines set by Order of a judge or adjudicator. While the parties may agree to an extension and seek a nunc pro tunc order from the Court or the LAT to amend the timelines imposed by an order, there is no guarantee the extension will be granted.
Finally, the Regulation anticipates that a renewal may be required. Generally, under the EMCPA, the order can only enact temporary suspensions for 90 days with further renewals allowed.
In light of this Regulation, it is important to do due diligence on files whether or not the deadlines have been temporarily suspended. The legislation also reminds us of the social importance of staying safe and staying at home.