Court of Appeal Decision of the Week

Limitation Periods; Deference to Judges at First Instance

Case: Tapak v. Non-Marine Underwriters, 2018 ONCA 168 (CanLII)

Keywords: Transportation; Limitation Periods

Synopsis:

Two days before Christmas, in 2000, a passenger travelling on a bus grabs the steering wheel and forces it across the highway where it rolls onto its side and into a ditch. Several passengers suffer injuries and one passenger dies. The surviving passengers issue a statement of claim as against:

  • the steering wheel-grabbing passenger;
  • the bus driver;
  • Greyhound Canada Transportation (“Greyhound”) as operator;
  • Her Majesty the Queen in the Right of the Province of Ontario; and
  • the Ontario Provincial Police (including two individual Constables).

Ten years later, at trial, it is determined none of the defendants (with the exception of Mr. Shaun Davis, the passenger who grabbed the steering wheel) is liable. The plaintiff passengers appeal and later seek leave to the Supreme Court of Canada, but the motion is withdrawn following settlement.

As Mr. Davis is uninsured, and by this point deceased, the surviving passengers seek to recover their damages from the Motor Vehicles Accident Claims Fund. They are denied indemnification. A further two years later, in January 2016, counsel for the plaintiff passengers contacts the Respondent insurer, Non-Marine Underwriters, seeking payment under s. 258 of the Insurance Act, R.S.O. 1990, c. I.8. The Respondent was insurer for the bus.

The matter proceeds to a Motion Judge on two issues: First, whether Mr. Davis was an “occupant” of the bus such that the Respondent’s insurance covers him and second, whether the two year limitation period had expired. The Motion Judge concludes the claim is statute barred. The Court of Appeal agrees, citing the need for deference and finding no palpable and overriding error.

Importance:

The Motion Judge found as follows:

“The determination of whether or not Davis was an insured under the Lloyd’s policy was a question that should have been determined at the latest, no later than two years after the January 31, 2012 decision…” (See para. 10).

Citing Hryniak v. Mauldin, 2014 SCC 7 (CanLII) at para. 81, the Court of Appeal stated categorically that the Motion Judge’s factual findings with respect to the commencement of the applicable limitation period are “entitled to deference”. (See para. 11).

The Appellants made three attempts to extend the limitations period. Each failed. First, the Court of Appeal declined to apply Smith et al. v. Tellier et al., 1974 CanLII 37 (ON CA), which stands for the proposition that a judgment is not final until any right of appeal has been exhausted, on the basis that appeals related to the underlying action could not have altered the liability findings as against Mr. Davis. (See para. 12).

Second, the Court of Appeal rejected the application of s. 5(1)(a)(iv) of the Limitations Act, 2002 SO 2002, c 24, Sch B and Presidential MSH Corp. v. Marr, Foster & Co. LLP, 2017 ONCA 325 (CanLII) to the circumstances of this case:

In our view, s. 5(1)(a)(iv) is not intended to be used to parse claims as between different defendants and thus permit one defendant to be pursued before turning to another defendant. Rather, it is intended to address the situation where there may be an avenue of relief outside of a court proceeding that a party can use to remedy their “injury, loss or damage” – see, for example, 407 ETR Concession Co. v. Day, 2016 ONCA 709 (CanLII), 133 O.R. (3d) 762. (See para. 13).

Finally, the Court of Appeal found that, notwithstanding the Appellants’ assertion that they sought declaratory relief only, the claim really sought “consequential relief” in the form of damages and so the exception under s. 16(1)(a) of the Limitations Act, 2002 does not apply.

Counsel for the Appellants: Christopher Hacio (Hacio Law, Thunder Bay)

Counsel for the Respondent: Amanda McBride and Daniel Michaud-Shields (McBride & Shields, Toronto)

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Posted: Wednesday, March 07, 2018