Legal Blog:

Limitations & Dismissal Based on Pleadings

Miano v. Campos 2019 Ont SCJ

Defendant defended a personal injury claim, in part with a limitations defence. The plaintiff did not deliver a reply, as he should have, claiming that he relied on the discovery sections of the Limitations Act. The defendant brought a motion under Rule 21(1)(a), alleging that the plaintiff had no cause of action because the action was commenced more than 2 years after the accident. The motion judge dismissed the motion; in effect, the discovery principle raised issues of mixed fact and law and, unless the facts are crystal clear and undisputed, Rule 21(1)(a) should not be used to determine limitation issues.

Assignment Versus Sublet

V Hazelton Limited v. Perfect Smile Dental Inc. 2019 Ont CA

Tenant sublet the entire premises, with the landlord’s consent, to a subtenant. Tenant had a right to renew under the lease. The sublease specifically acknowledged the tenant’s right, but stated that the subtenant did not have that right. The sublease sublet the entire remaining term, rather than the term less one day. When it came time to renew the lease, landlord took the position that, in failing to reserve a portion of the term, tenant assigned the lease and therefore had no standing to renew it. Under common law, landlord was correct; however, under section 3 of the Commercial Tenancies Act, which has been around in one form or another since 1895 and mostly ignored, the landlord-tenant relationship does not depend on tenure and a reversion is not necessary to create that relationship. However, as the Court of Appeal pointed out, the section does not say what is necessary to create the relationship. The court interpreted section 3 to mean that there may be a landlord-tenant relationship without reserving any of the term, but only if sufficient evidence demonstrated that, objectively, the tenant and subtenant did not intend to create an assignment. In this case, the specific reference to the subtenant’s inability to exercise the tenant’s right of renewal comprised sufficient evidence in favour of a sublease only and tenant was allowed to renew the lease.

Limitations (5)

The Limitations Act was enacted in 2002 and was proclaimed in force as of January 1, 2004. We probably do not exaggerate when we suggest that no Ontario statute claims as much prominence as the Act. It is continually discussed in the jurisprudence and any time a lawyer considers whether to advise a client to commence or defend an action, the lawyer considers the effect of the Act. The Act has a basic limitation period of 2 years from discovery and an absolute limitation period of 15 years regardless of discovery.