All About Estates

Triumph of the Trustee Act

You may be forgiven for thinking that the expression “clear as mud” was created specifically to describe limitation periods. The policy rationale behind limitation periods is to create certainty and predictability by establishing a firm deadline by which a claim must be brought or else the claim is lost forever. However, figuring out the limitation period may be difficult, especially when multiple statutes establish different limitation periods that apply to the same circumstances. Such was the case in Levesque v Crampton Estate.

By way of background, the plaintiff alleged that he was sexually assaulted by a priest in the 1970s. The priest pled guilty to the charges and was sentenced to eight month’s imprisonment in the 1980s. The priest passed away in 2010.

In 2013, the plaintiff brought the present action against the priest’s estate and the church’s governing organization (based in Ottawa).

In 2014, the church organization issued its statement of defence and a crossclaim against the priest’s estate for contribution and indemnity in the event any damages were awarded to the plaintiff.

In 2015, the plaintiff’s claim against the priest’s estate was dismissed on the grounds that it was barred – the plaintiff had started his action against the priest’s estate three years after the priest’s death, which was outside the two-year time limit set out in the Trustee Act .

The priest’s estate brought a motion to have the church organization’s crossclaim dismissed as well. The motion was unsuccessful at the trial level and the priest’s estate appealed.

The Court of Appeal for Ontario allowed the appeal and dismissed the crossclaim against the priest’s estate. In reaching its decision, the three-panel court reviewed the limitation periods set out in the Trustee Act and the Limitations Act, 2002.

Section 38(3) of the Trustee Act creates a hard two year deadline from date of death for any person or organization to bring an action against the deceased’s estate for any wrong committed by the deceased while alive. Because, his claim against the priest’s estate was dismissed.

The church organization argued that its crossclaim against the priest’s estate was governed by the Limitations Act, not the Trustee Act. Section 4 of the Limitations Act, 2002, establishes a general two year limitation period to commence any claim, beginning on the date the claim is discovered. Section 18(1) of the Limitations Act, 2002, sets out that the two-year limitation period for a defendant to bring a crossclaim for contribution and indemnity starts running from the date on which the underlying claim is served.

The Court of Appeal described the difference between the two deadlines as follows:

The Limitations Act, 2002 is based on discoverability. Section 18(1) deems the claim to be discovered on the date the claim is served on the person who seeks contribution or indemnity. In contrast, s. 38(3) of the Trustee Act is a “hard” or absolute limitation. It is triggered by a fixed and known event – the death of the party against whom a claim is made.

In this case, the church organization argued that while the plaintiff was statute barred from continuing his claim against the priest’s estate pursuant to the Trustee Act, the Limitations Act, 2002, imposed a different limitation period on its crossclaim, which had not yet expired.

The Court of Appeal held that the crossclaim was a type of “action” and therefore fell within the purview of the Trustee Act. However, section 18(1) of the Limitations Act also clearly applied to the crossclaim. In order to resolve the conflict, the court turned to section 19 of the Limitations Act, 2002.

Section 19 refers to a Schedule which lists other statutes which take precedence over the limitation periods established in the Limitations Act, 2002 (unless listed in the Schedule, the Limitation Act, 2002, takes precedence). Section 38(3) of the Trustee Act is among those set out in the Schedule to the Limitations Act, 2002. As a result, the court found that the “hard” two-year limitation period established in the Trustee Act took precedence over the “discoverability” deadline established by the Limitations Act, 2002. Since the crossclaim was started more than two years after the priest died, the crossclaim was dismissed.

While the fear of missing a limitation period keeps litigators up at night, they also provide a wealth of late night reading. For more discussions of limitation issues, see the blogs by Joanna Lindenberg and Jacob Kaufman.

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About Gillian Fournie

Gillian is a lawyer with de VRIES LITIGATION LLP. Her practice focuses on the area of trusts and estates litigation.

gfournie@devrieslitigation.com

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