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Damages - Continuing/Recurring. Huether v. Sharpe
In Huether v. Sharpe (Ont CA, 2025) the Ontario Court of Appeal allowed an appeal, here where the lower "motion judge dismissed the Township’s motion for summary judgement, finding that the Township’s negligence was ongoing and continuous and, therefore, the ultimate limitation period had not yet expired by virtue of s. 15(6)(a) of the Act".
Here the court extensively considers the concept of 'continuous act or omission' in limitations law [Note: the similar concept of 'rolling' limitation periods may bear only on contractual situations]:[1] This appeal raises the issue of what constitutes a “continuous act or omission” under s. 15(6)(a) of the Limitations Act, 2002, S.O. 2002 c. 24, Sched. B (the “Act”) sufficient to toll the running of the 15-year ultimate limitation period in s. 15(2).
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[6] ... the motion judge failed to properly interpret the meaning of a “continuous act or omission” and therefore incorrectly concluded that the ultimate limitation period in s. 15(2) had never commenced running in respect of the respondents’ claim. As I explain below, the ultimate limitation period had expired on January 1, 2019, and the motion judge ought therefore to have granted the Township’s motion for summary judgement dismissing the proceeding as statute barred.
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STANDARD OF REVIEW
[25] The interpretation of the ultimate limitation period in s. 15 of the Act is a question of law subject to review on a standard of correctness: Wong, at para. 16.
GOVERNING LEGAL PRINCIPLES
(1) Relevant statutory provisions
[26] Section 4 of the Act sets out a “basic” limitation period of two years after discovery of a claim. However, this basic limitation period is subject to the “ultimate limitation period” set out in s. 15(2), which provides as follows:(2) No proceeding shall be commenced in respect of any claim after the 15th anniversary of the day on which the act or omission on which the claim is based took place. [27] Section 15(6)(a) further provides that in the case of a “continuous act or omission”, the act or omission takes place “on the day on which the act or omission ceases”.
[28] Accordingly, if the alleged negligence of the Township is a “continuous act or omission” which has not yet ceased (as the respondents contend), then the act or omission on which the respondents’ claim is based has not yet occurred, and the limitation period in s. 15(2) has not yet commenced running.
[29] If, on the other hand, the alleged negligence was not a “continuous act or omission” then the limitation period in s. 15(2) would have commenced running on January 1, 2004 and expired 15 years later, on January 1, 2019. This results from the transitional provision in s. 24(5)1 of the Act, which provides that if the “former limitation period”[3] had not expired by January 1, 2004 and the claim was not discovered before that date, then “the Act applies as if the act or omission had taken place on that date.”
[30] In short, this appeal turns on whether the Township’s alleged negligence constitutes a “continuous act or omission” within the meaning of s. 15(6)(a) of the Act.
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(3) The purpose of the ultimate limitation period in s. 15(2)
[32] Ontario’s comprehensive reform of the law of limitations, which came into force in 2004, sought to create “a clear and cohesive scheme for addressing limitation issues, one that balances the plaintiff’s right to sue with the defendant’s need for certainty and finality”: Canaccord Capital Corp. v. Roscoe, 2013 ONCA 378, 115 O.R. (3d) 641, at para. 17.
[33] Thus, on the one hand, the basic limitation period was derived from the common law “discoverability principle”, such that the limitation period would generally only run once a person became aware (or ought reasonably to have become aware) of their claim.
[34] At the same time, the enactment of an ultimate limitation period was seen as necessary to avoid a situation where a legal proceeding could be brought in respect of hidden defects that that were only discovered many decades later. In introducing the legislation, Attorney General Bryant expressly justified the ultimate limitation period as necessary to prevent such untimely legal proceedings in respect of latent building defects:Does it make sense that architects and engineers can be sued 50 years after building a home? Of course not. Interestingly, that is the current state of affairs, which does not make much sense at all.[4] [35] The ultimate limitation period in s. 15(2) of the Act was intended to address this mischief. Its purposes include avoiding costs related to record-keeping and insurance due to continuous exposure to liability; addressing evidentiary concerns arising from deceased or missing witnesses or records that might have been destroyed by fires, floods, or other intervening events; recognizing that memories fade and even where a witness is available their ability to recall events that took place many decades in the past will be limited; and serving the public interest in bringing an end to litigation and the revisiting of past errors: York Condominium Corp. No. 380 v. Jay-M Holdings Ltd., 2007 ONCA 49, 84 O.R. (3d) 414, at paras. 30-34, leave to appeal refused, [2007] S.C.C.A. No. 154; Wong, at paras. 23-25.
[36] At the same time, in order to avoid unfairness to plaintiffs with undiscovered claims, the legislature provided a number of exceptions to the operation of the ultimate limitation period. One of these exceptions was that set out in s. 15(6)(a) in respect of “continuous acts or omissions”. As the Alberta Law Reform Institute explained in a 1989 report recommending an ultimate limitation period, in situations where wrongful conduct has continued, concerns over stale evidence are mitigated by the fact that “the evidence will have continually renewed itself with the defendant’s repetitive conduct”: Alberta Law Reform Institute, Limitations (Edmonton: Alberta Law Reform Institute, 1989), at p. 70; Seidel v. Kerr, 2003 ABCA 267, 19 Alta. L.R. (4th) 201, at para. 45. Moreover, “[j]ustice does not require giving the defendants repose for wrongful conduct which just stopped.” These are relevant and helpful considerations in determining the scope and application of the term “continuous act or omission” in s. 15(6)(a) of the Act.
(4) The elements of a “continuing cause of action”
[37] The concept of a “continuing cause of action” is a long-standing principle of procedural and limitations law in Ontario as well as other common law jurisdictions.[5]
[38] Section 117 of the Courts of Justice Act, R.S.O. 1990, c. C-43 entitles the court to assess damages with respect to a continuing cause of action that arises between the commencement of the action and trial. The predecessors of s. 117 have been in force in Ontario since at least 1919 and the concept of a continuing cause of action dates to the 19th century: Hamilton v. Quaker Oats Co. (1919), 46 O.L.R. 309 (H.C.) at para. 10; Hole v. Chard Union, [1894] 1 Ch. 293, at pp. 295-96. Equivalent provisions exist in procedural and limitation statutes in a number of other provinces: see e.g., Alberta Rules of Court, Alta. Reg. 124/2010, r. 9.9; Limitations Act, R.S.A. 2000, c. L-12, s. 3(3)(a); and Limitations of Actions Act, S.N.S. 2014, c. 35, s. 8(3)(a). The interpretation of these various provisions has generated a considerable body of law defining a “continuous cause of action”.
[39] In essence, the term is used to describe causes of action that accrue from repeating actionable conduct. Because each repetition of the actionable conduct is identical and occurs continuously, it founds a new and discrete cause of action.
[40] This understanding of the concept of a “continuing cause of action” was adopted by this court in its 1924 decision in McIntosh v. Parent (1924), 1924 CanLII 401 (ON CA), 55 O.L.R. 552 (C.A.), at p. 424, quoting the 1894 English Court of Chancery decision in Chard Union, at pp. 295-96:[W]hat is called a continuing cause of action is a cause of action which arises from the repetition of acts or omissions of the same kind as that for which the action was brought… If once a cause of action arises, and the acts complained of are continuously repeated, the cause of action continues and goes on de die in diem [from day to day]. [41] Nuisance and trespass are the most common examples of continuing causes of action, since each day the nuisance or trespass occurs a new and identical cause of action in nuisance or trespass accrues: see e.g., Smart v. South Saskatchewan Hospital Centre, 1989 CanLII 4801 (SK CA), 60 D.L.R. (4th) 8 (Sask. C.A.), at para. 46.[6] In such cases, “[the] injury is said to be a continuing one so long as it is still in the course of being committed and is not wholly past”: Roberts v. City of Portage La Prairie, 1971 CanLII 128 (SCC), [1971] S.C.R. 481, at p. 491, quoting Salmond on Torts, 15th ed., at p. 791.
[42] Continuing causes of action are uncommon. In Jalla & Ors v. Shell International Trading and Shipping Company & Anor, [2021] EWCA Civ 63, at paras. 52-53, the England and Wales Court of Appeal (Civil Division) observed that a cause of action in tort “is usually a single, self-contained package of rights, relating to an act or omission which has caused damage and is actionable in law” while “[a] continuing cause of action is more unusual.”
[43] Thus, actionable conduct is not continuing merely because it can be rectified or because the harm it causes is either continuing or delayed. This principle is illustrated by Sunset Inns Inc. v. Sioux Lookout (Municipality), 2012 ONSC 437, aff’d 2012 ONCA 416, where the defendant municipality installed a sewer line to the plaintiff’s building in 1986. There were ongoing problems with flow in the sewer line, which eventually led the plaintiff to commence a proceeding alleging that the municipality installed the line negligently. The defendant municipality brought a motion for summary judgement on the basis that the claim was statute barred, which the plaintiff resisted by arguing, inter alia, that the municipality was under an ongoing duty to repair the deficient sewer line and, therefore, the negligence was a “continuous cause of action”.
[44] In a judgment upheld on appeal to this court, the plaintiff’s argument was rejected on the basis that a continuous act or omission requires a succession or repetition of separate acts of the same character. The allegation that the defendant was under an ongoing duty of care to the plaintiff “does not constitute the type of repetitive and continuing conduct which is the foundation of the continuing cause of action”: Sunset Inns, at para. 22.
[45] Similarly, in Bowes v. Edmonton (City of), 2007 ABCA 347, 86 Alta. L.R. (4th) 47, a riverbank collapse destroyed the plaintiffs’ homes 12 years after their construction. The plaintiff sued the defendant municipality for negligence, alleging a breach of its duty to warn against construction on the riverbank and arguing that the breach was continuous. The Alberta Court of Appeal rejected this argument, reasoning that any alleged negligence had occurred by the time the buildings were constructed and “absolutely nothing happened” thereafter: at para. 169. The court pointed out that “[t]o regard every ancient failure to warn as occurring every day would be a fiction destroying all limitation periods… [since] most cases of delayed harm from a tort could be dressed up as failures to warn, with no limitation period”: at paras. 173-174.
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[48] .... As Sunset Inns explains, the mere allegation that the defendant has some generalized ongoing duty to the plaintiff is, in and of itself, insufficient to toll the running of the ultimate limitation period, absent some successive or repeated actionable conduct on the part of the defendant.
[49] This interpretation of a “continuous act or omission” is consistent with the purposes underlying the ultimate limitation period, including the exception in s. 15(6)(a). As Attorney General Bryant explained, a central concern that led to the enactment of s. 15(2) was precisely to avoid litigation over latent defects in buildings constructed decades in the past.[7]
[50] This proceeding is a classic illustration of the difficulties associated with such belated litigation. All the individuals who were directly involved in the construction of the Dwelling are now deceased. Amongst other things, this means that it is impossible for the Township to satisfy the obligation imposed by the motion judge to “follow up” with Attwood, the deceased Permit holder, regarding the status of construction that was completed over 35 years ago. While the motion judge claimed that the documents in the Permit file “speak for themselves”, this is belied by the fact that the source of the handwritten notation on the Order to Comply is unknown. Moreover, the documents in the file do not tell anywhere near the complete story, including whether Helka believed that he had closed the Permit.
[51] In short, this is not a situation such as that described by the Alberta Law Reform Institute in its 1989 report, where there is repeating actionable conduct that mitigates concerns over stale evidence. Rather, this proceeding exemplifies the observation of the Alberta Court of Appeal in Bowes, at para. 122, to the effect that “trying to find and test evidence about events decades old is usually roulette, not a serious exploration of the truth.”
[52] The practical effect of the motion judge’s reasoning is that there is no limitation period applicable to proceedings in respect of latent defects in the Dwelling. Consider that if the defects in this case had not been discovered until 50 or even 100 years from now, the then-owners could still commence a proceeding because the Township’s failure to satisfy their “duty to monitor” would have constituted a “continuing act or omission” that had not yet ceased. Such a result runs directly contrary to the Legislature’s stated intention to preclude such litigation, and the need to “balance the plaintiff’s right to sue with the defendant’s need for certainty and finality”: Canaccord, at para. 24.
[53] The respondents argue that if this proceeding is statute barred, homeowners will not be able to recover damages from a municipality for failure to conduct inspections or otherwise regulate building construction, contrary to this court’s holding in Breen.
[54] I do not agree. The issue is not whether a property owner has a right to sue for a municipality’s negligence, but for how long. In Breen, the municipality was found to have breached its duty of care to the plaintiffs by closing a permit file in 1993 without conducting the necessary inspections. But in Breen the action was commenced in February 2014. Thus, although the negligence had taken place in 1993, the ultimate limitation period did not commence running until January 2004, in accordance with s. 24(5)1 of the Act, and had not yet expired. Breen does not assist the respondents in this case since this proceeding was not commenced until February 2022, after the expiry of the ultimate limitation period on January 1, 2019.
[55] A continuing act or omission requires a repetition of actionable conduct on a continuous basis by a defendant. There is no evidence of any such actionable conduct by the Township after February 1998. Although the Permit may have technically remained open, the Township considered it closed upon the issuance of the 1988 Certificate. Thereafter, the file became dormant and eventually was moved into storage. Even assuming, without deciding, that the Township had a duty to monitor open building permits, the existence of such a duty alone cannot amount to a continuous act or omission on the part of the Township for the purposes of s. 15(6)(a).
[56] I therefore conclude that the respondents’ proceeding is barred by s. 15(2) of the Act and would allow the appeal on that basis.
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