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Limitations Act - Acknowledgement [s.13]

. 1702108 Ontario Inc. v. 3283313 Canada Inc.

In 1702108 Ontario Inc. v. 3283313 Canada Inc. (Ont CA, 2016) the Court of Appeal sets out the specificity which is required before a debt admission constitutes an acknowledgement:
[2] First, the appellant contends the motion judge erred in failing to find that a March 14, 2013 email sent by Mr. Durrani, when read in the context of payments made by the respondent following the appellant’s 2009 demand letter, was an acknowledgement of liability within the meaning of s. 13(1) of the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B (the “Act”). That sub-section provides, in part: “If a person acknowledges liability in respect of a claim for payment of a liquidated sum… the act… on which the claim is based shall be deemed to have taken place on the day on which the acknowledgement was made.”

[3] The motion judge held that Mr. Durrani’s email of March 14, 2013 did not constitute an acknowledgement of liability for the purposes of s. 13 of the Act. The motion judge held that although the email acknowledged an outstanding amount, it did not contain an acknowledgement or concession of the amount owing and, therefore, was not an acknowledgement of the debt.

[4] The appellant submits the motion judge applied the wrong legal test for identifying an acknowledgement in reaching that conclusion. It contends the respondent’s statement in the email that he could not make any payments until he had settled the dispute with his ex-partner amounted to an acknowledgement for the purposes of s. 13(1) of the Act.

[5] The language of the statute sets out the applicable test: s. 13(1) is engaged when a person acknowledges liability in respect of a claim for payment of a liquidated amount. In Middleton v. Aboutown Enterprises Inc., 2009 ONCA 466, this court held, at para. 1, that s. 13(1) requires a “clear and unequivocal acknowledgement of the debt claimed.” In that case, the court upheld the motion judge’s finding that a mere offer to settle a claim, without acknowledging that any amount remained owing, did not amount to an acknowledgement of liability for the purposes of s. 13(1).

[6] In the present case, Mr. Durrani’s March 14 email did not acknowledge liability for the liquidated sum of $296,700 demanded by the appellant in its March 14 correspondence. At most, the respondent’s March 14 email proposed negotiating a settlement plan, without acknowledging that any amount remained owing. When the appellant subsequently pressed for an acknowledgement of liability for the liquidated sum, the respondent refused to give one. Accordingly, we see no basis to interfere with the motion judge’s conclusion that the March 14, 2013 email was not an acknowledgement. We would not give effect to this ground of appeal.


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