Simon's Legal Resources

Limitations Act - Contribution and Indemnity [s.18]

. Albert Bloom Limited v. London Transit Commission

In Albert Bloom Limited v. London Transit Commission (Ont CA, 2021) the Court of Appeal considered Limitations Act s.18 regarding contribution and indemnity:

(a) Claims for Contribution and Indemnity

[22] Claims for contribution and indemnity are governed by s. 18 of the Limitations Act, which provides:

18 (1) For the purposes of subsection 5 (2) and section 15, in the case of a claim by one alleged wrongdoer against another for contribution and indemnity, the day on which the first alleged wrongdoer was served with the claim in respect of which contribution and indemnity is sought shall be deemed to be the day the act or omission on which that alleged wrongdoer’s claim is based took place.

(2) Subsection (1) applies whether the right to contribution and indemnity arises in respect of a tort or otherwise.

[23] An absolute two-year limitation period running from the date on which the first alleged wrongdoer was served with the claim is not established by s. 18. Instead, as described by Paciocco J.A. in Mega International Commercial Bank (Canada) v. Yung, 2018 ONCA 429, 141 O.R. (3d) 81, at para. 74, s. 18 operates as follows:

The two-year limitation period prescribed by ss. 4, 5(2), and 18 for contribution and indemnity claims presumptively begins on the date of service of a claim in respect of which contribution and indemnity is sought. That presumptive limitation period start date, however, can be rebutted by the discoverability principles prescribed in s. 5 of the Limitations Act, 2002.

[24] It is worth reiterating that once the second anniversary of the service of the claim passes, the onus shifts to the party seeking contribution and indemnity to establish why its claim was not discoverable. In the case at bar, as will be discussed, it appears, based on some of the arguments being advanced on the appeal, there was some confusion regarding who has the onus.