Three days and $400,000

On Friday, October 4, 2019, a crane working on the building next door struck a Toronto condominium. The damage to the concrete above the parking garage came to more than $400,000. The concierge told the property manager the same day. On Monday, October 7, the manager met the contractor.

The condo corporation issued its claim on April 7, 2022. In Toronto Standard Condominium Corporation No. 2587 v. Rock Contracting Services & Management Inc., the Court of Appeal upheld summary judgment dismissing the action as statute-barred.

Why April 2022? The basic limitation period in Ontario is two years from the day you discover the claim. In 2020, the province suspended limitation periods for about six months because of the pandemic. Add the suspension to two years from October 7, 2019, and by my arithmetic you land on April 7, 2022. The claim was issued within a day of the end of that calculation.

The problem is the calculation started on the wrong day. The corporation argued it could not have discovered the claim until it learned the contractor’s name on the Monday. The court said the clock started on the Friday. The difference was three days, and the claim was late.

Three things decided the appeal.

First, the property manager’s knowledge was the corporation’s knowledge. The manager was the corporation’s agent, and the corporation did not challenge that finding. A condo corporation acts through its manager, and it discovers claims through its manager too.

Second, the Limitations Act presumes that you knew of your claim on the day the damage happened. To rebut the presumption you need evidence, and it has to come from the right people. The two people who knew what the corporation knew on October 4 were the concierge and the manager. Neither swore an affidavit. A board member did, but he first heard of the incident on October 11 and could not say what the manager knew on the Friday. The presumption stood.

Third, the court said that even if the contractor’s name only came on the Monday, nobody explained why the claim then sat for the next two years. Discoverability is a question of fact, and the motion judge’s finding gets deference on appeal. You do not want to be the appellant asking a panel to move a start date by three days.

In 2013 I wrote that one of the three reasons to sue is to protect your right to sue at all. Almost everything else in litigation can be fixed, negotiated, or appealed. A missed limitation period cannot. This case shows what that looks like in practice. The corporation had a real loss and a known defendant, and it still lost the claim over which of two days the clock started.

An argument about when the clock started is not one anyone wants to be having. When there is doubt, the safer course is to count from the earliest date the other side could point to and issue the claim with time to spare. Filing on the last day of a calculation works only if the court agrees with the calculation. This corporation found out what happens when it does not.