This province’s statute of limitations ‘cries out for reform’

In trying to sue construction contractors for a leaky building, a Winnipeg hospital is actually criticizing Manitoba’s Limitation of Actions Act, a provincial appeal court judge suggested in a recent ruling.

In 2003, construction finished on a new five-storey building for St. Boniface General Hospital.

“Between 2012 and 2014, there were over 60 reports of water infiltration into the building described variously as wet windows, leaking ceilings, water collecting on window sills and damaged drywall,” Justice Jennifer Pfuetzner wrote in St. Boniface General Hospital v PCL Constructors, released May 14 by the Manitoba Court of Appeal.

Allegations against PCL Constructors and Ferguson Corporation – which built a curtain wall system for the hospital – have not been proven.

In 2016, the hospital asked the court for leave to start a lawsuit against PCL and Ferguson, under section 14(1) of the Limitation of Actions Act, which has a general rule imposing a one-year statute of limitations.

The hospital lost. An application judge denied leave to St. Boniface Hospital, which was unsuccessful on appeal.

As a result of the May 14 court of appeal decision, the lawsuit is time-barred.

Part of the hospital’s argument on appeal was “really a critique” of Part II of the Limitation of Actions Act, Justice Pfuetzner wrote in the unanimous ruling.

Previous Manitoba court rulings have described Part II of the Limitation of Actions Act as “rather obscure,” and “somewhat complicated” and “very difficult to understand,” she wrote.

Justice Pfuetzner quoted from a Manitoba Law Reform Commission on the statute of limitations published in 2010.

Having a statute of limitations means that defendants do not need to keep evidence forever and plaintiffs need to be diligent if they decide they want to sue someone.

Ontario has a “far more coherent and rational” statute of limitations than Manitoba’s Limitation of Actions Act, the law reform commission said.

“In my view, Part II of the Act cries out for reform,” Justice Pfuetzner wrote last week in St. Boniface. “The modern limitations statutes adopted in other provinces are far simpler. Generally, they provide that the limitation period does not begin to run until the claimant has actual or constructive knowledge of the fact that he or she has a claim.”

Rulings on plaintiffs’ applications under the Limitation of Actions Act should be treated with deference by appeal courts, judge Pfuetzner wrote. In its unanimous ruling against the hospital, the appeal court found that the applications judge did not make any palpable or overriding errors in applying the legal tests to the facts.

Early in 2015, the hospital hired a curtain wall systems expert to investigate the cause of water infiltration. The expert delivered its report June 11, 2015. That report listed findings indicative of “significant infiltration of cold, exterior air”; “significant air leakage of the building envelope”; “high levels of infiltration/exfiltration due to air leakage through the window and wall system”; and “the presence of significant air leakage through the framing of the curtain wall and at terminations.”

It was more than a year before the hospital filed its application for leave to file the lawsuit.

Section 14(1) of the Limitation of Actions Act is the statutory discoverability rule. That rule states that a court can grant a plaintiff leave to start or continue a lawsuit “if it is satisfied on evidence adduced by or on behalf of the applicant that not more than 12 months have elapsed between

(a)   the date on which the applicant first knew, or, in all the circumstances of the case, ought to have known, of all material facts of a decisive character upon which the action is based; and

(b)   the date on which the application was made to the court for leave.

A different section of the law defines “material fact” as

(a)   The fact that injuries or damages resulted from an act or omission.

(b)   The nature or extent of any injuries or damages resulting from an act or omission.

(c)   The fact that injuries or damages so resulting were attributable to an act or omission or the extent to which the injuries or damages were attributable to the act or omission.

(d)   The identity of a person performing an act or omitting to perform any act, duty, function or obligation.

(e)   The fact that a person performed an act or omitted to perform an act, duty, function or obligation as a result of which a person suffered injury or damage or a right accrued to a person.

St. Boniface hospital argued before the limitations clock starts running, a plaintiff needs “decisive evidence” in order for there to be “material facts” known to the plaintiff.

Both the applications judge and the appeal court disagreed, ruling that a plaintiff does not have to be certain of a link between the conduct of a potential defendant and the harm suffered. The limitations clock can start running if there is a link between the alleged conduct and harm, the courts ruled.

In its 2010 report, the Manitoba Law Reform Commission contrasted Manitoba law with Ontario.

Section 5 (1)(a) of Ontario’s Limitations Act says the clock starts on the day on which the person with the claim first knew,

(i) that the injury, loss or damage had occurred,

(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,

(iii) that the act or omission was that of the person against whom the claim is made, and

(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it.

Section 5 (1 (b)) says it could also start on the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).