Alternative Processes May Not Suspend Limitation Period

• Published date: 08 December 2020
• Subject Matter: Litigation, Mediation & Arbitration, Arbitration & Dispute Resolution, Trials & Appeals & Compensation
• Law Firm: Torkin Manes LLP
• Author: Mr Marco P. Falco

Since the 2016 decision in 407 ETR Concession Co. v. Day 2016 ONCA 709, Ontario law is clear that where a plaintiff pursues an alternative process to a civil action in order to resolve their dispute, the two-year limitation period may be suspended. But what happens when the plaintiff pursues that alternative process knowing it may not be the right forum in which to adjudicate their claim?

A 2020 decision of the Ontario Court of Appeal, Beniuk v. Leamington (Municipality) 2020 ONCA 238, addresses this question.

Beniuk suggests that where a plaintiff chooses to have their claim adjudicated outside the context of litigation, the limitations clock may continue to run for the plaintiff's action where the alternative dispute resolution process has no jurisdiction to hear the dispute.

The wrong forum

Beniuk involved a claim by the two plaintiff owners of a residential property. Their home experienced significant structural damage allegedly caused by vibrations from heavy truck traffic on a rural road abutting the residence.

After the defendant municipality declined to reconstruct the road and after the homeowners retained an engineer to opine on the cause of the damage, the owners commenced a proceeding before the Ontario Municipal Board (OMB) in December 2009.

At the OMB, the plaintiffs argued that the pre-1927 construction of the rural road caused them injurious affection. In Ontario, the 0MB has exclusive jurisdiction over injurious affection claims.

On Jan. 5, 2010, the defendant municipality delivered its reply to the plaintiff's OMB claim. In that reply, the municipality pleaded that the 0MB claim was not really one for injurious affection and, in any event, the 0MB was not the proper venue to resolve the dispute.

OMB ultimately held in favour of the municipality on Jan. 10, 2018. The OMB held that it did not have jurisdiction over the homeowners' claim. It further held that the essence of the claim was one concerning the use of the road, not its construction. As such, the concept of injurious affection did not apply.

following the dismissal of their OMB claim, the plaintiffs started a civil action in the Ontario Superior Court for nuisance and negligence against the defendant municipality on Jan. 17, 2018.

The municipality moved for summary judgment to dismiss the civil claim.

It argued that the plaintiffs' claim was statute-barred as having been started more than two years after the plaintiffs discovered their claim under section 4 of Ontario's...