ANDROS ENTERPRISES LTD., ASTIR INVESTMENTS LTD. v. DIANE HANDLEY, 2023 SKKB 228

KING’S BENCH FOR SASKATCHEWAN Citation: 2023 SKKB 228 Date: 2023 10 31 Docket: QBG-RG-01425-2014 Judicial Centre: Regina ___________________________________________________________________________ BETWEEN: ANDROS ENTERPRISES LTD., ASTIR INVESTMENTS LTD. and DIANE HANDLEY PLAINTIFFS - and - BENJAMIN BENNETT DEFENDANT - and - FIESTA BARBEQUES LIMITED and WOLFEDALE ENGINEERING LIMITED DEFENDANTS/PLAINTIFFS BY THIRD PARTY CLAIM (RESPONDENTS) - and – VOMAR INDUSTRIES INC.

DEFENDANT BY THIRD PARTY CLAIM (APPLICANT) Counsel: No one appearing for the plaintiffs Tristan Culham and Allison Graham for the defendants/plaintiffs by third party claim/respondents, Fiesta Barbeques Limited and Wolfendale Engineering Limited

Holli Kuski Bassett for defendant by third party claim/applicant, Vomar Industries Inc. Haley Irwin for the defendant, Benjamin Bennett __________________________________________________________________________ FIAT MITCHELL J. OCTOBER 31, 2023 ___________________________________________________________________________ I. Overview [ 1 ] Vomar Industries Ltd. [Vomar], the third-party defendant in this insurance action, applies for an order under either Rule 7-9(2) or Rules 7-2 to 7-5 – the

summary judgment regime – of The Queen’s Bench Rules for an order either striking or dismissing the third-party claim of the respondents, Fiesta Barbeques Limited [Fiesta], and Wolfedale Engineering Limited [Wolfedale]. Vomar contends that this third-party claim is statute-barred by virtue of The Limitations Act , SS 2004, c L-16.1 [ Act ]. [ 2 ] This action arose following a fire which occurred on July 8, 2012 on the balcony of an apartment occupied by Benjamin Bennett [Mr. Bennett]. A barbeque being used by Mr.

Bennett caught fire and caused significant damage to the apartment building, as well as to the suite adjacent to his. Ms. Diane Handley [Ms. Handley] occupied this suite. [ 3 ] Fiesta had manufactured the barbeque. Wolfedale distributed it. [ 4 ] Andros Enterprises Ltd. [Andros] and Astir Investments Ltd. [Astir] owned the apartment building that had been damaged by the barbeque fire. Together with Ms. Handley, Andros, and Astir [plaintiffs] commenced an action against Fiesta, Wolfedale, and Mr. Bennett on July 4, 2014.

They seek compensation for damage to the apartment building, lost rent and related expenses, including Ms. Handley’s damaged property and living expenses. [ 5 ] Vomar came to be involved in this action sometime in 2015. Vomar operates a business which supplies pre- filled propane cylinders to retail establishments as well as requalifies and refills empty propane cylinders. Vomar had requalified the propane cylinder which caught fire on Mr.

Bennett’s balcony. [ 6 ] On October 20, 2015, the plaintiffs sought to add Vomar as a defendant to the action alleging it had been negligent in its requalification and inspection of the propane cylinder which had caught fire. [ 7 ] On August 11, 2017, the plaintiffs’ application to amend the statement of claim by adding Vomar as a defendant, was dismissed. See: Andros Enterprises Ltd. v Fiesta Barbeques Limited , 2017 SKQB 234 [ Amendment Application ]. The chambers judge determined the limitation period had expired by the time the amendment application was commenced.

As well, he determined that the claim advanced by the plaintiffs against Vomar did not arise out of the “same transaction or occurrence” to facilitate an amendment under s. 20 of the Act . [ 8 ] On November 22, 2017, Fiesta, Wolfedale, and Mr. Bennett then applied to have Vomar added as a third party. This application, too, failed. See: Andros Enterprises Ltd. v Fiesta Barbeques Limited , 2018 SKQB 67 . [ 9 ] On November 5, 2019, the Saskatchewan Court of Appeal allowed an appeal from the lower court’s ruling denying leave to add Vomar as a third-party to this action.

See: Fiesta Barbeques Limited v Andros Enterprises Ltd. , 2019 SKCA 114 , 443 DLR (4th) 158. No appeal was taken from the decision denying leave to add Vomar as a defendant. [ 10 ] Subsequently, on November 22, 2019, Fiesta and Wolfedale served a formal third-party claim on Vomar. Vomar, in turn, served its statement of defence to this claim on January 21, 2020. [ 11 ] Finally, on January 21, 2020, Vomar commenced this application seeking either to strike the third-party claim or to have it summarily dismissed.

Vomar argues that the limitation period for commencing a claim for contribution and indemnity pursuant to s. 14 of the Act expired well-before Fiesta and Wolfedale filed their third-party application. [ 12 ] On this application, Vomar asserts that two dates are critical. The first is August 25, 2014 which is the date on which Fiesta, Wolfedale, and Mr. Bennett were served with the statement of claim. The second is November 22, 2017 which is the date they served notice of their application to issue a third-party claim.

Juxtaposing these two dates, Vomar submits, demonstrate that the third-party claim pressed by Fiesta and Wolfedale is statute-barred. [ 13 ] Fiesta and Wolfedale demur. They assert that they only came to know about, or “discovered”, Vomar and the role it potentially played in contributing to the fire on or about August 25, 2015. This is when the plaintiffs advised Fiesta and Wolfedale that they would bring a formal application to amend to add Vomar as a party defendant to their action.

[ 14 ] Fiesta and Wolfedale assert further that when the plaintiffs formally commenced such an application, it was unnecessary, and would have been legally inappropriate, to bring a parallel application seeking to commence a third-party claim against Vomar. Effectively, Fiesta and Wolfedale argue that the plaintiffs’ application to amend their statement of claim tolled the relevant limitation period.

Only when the plaintiffs’ application was dismissed – August 11, 2017 – did the limitation period recommence. [ 15 ] As Fiesta and Wolfedale formally commenced their third-party claim on November 22, 2017, they assert they were well within the two-year limitation period following “discovery” of Vomar’s potential liability for the fire. II. Relevant Timeline [ 16 ] The timeline of events in this matter is critical.

The following chart sets out more completely the important dates relevant to this application: DATE IMPORTANT EVENTS Approximately July 2007 Vomar “requalified” the tank that is alleged to have caused the fire in question. July 8, 2012 A fire erupts at the apartment of the defendant Bennett, allegedly when he was turning off the main valve to the propane tank that was connected by a rubber hose to the barbecue, which was manufactured by Fiesta and distributed by Wolfedale. July 4, 2014 The original statement of claim is issued by the plaintiffs against the defendants, including Fiesta and Wolfedale.

August 25, 2014 The original statement of claim is served on Fiesta and Wolfedale. Approximately January 2015 The plaintiffs come across a copy of a report forwarded by the Office of the City Solicitor on September 24, 2012. The report, dated July 9, 2012, identifies “a mechanical failure inside the main valve on the propane tank” as the cause of the fire. May 12, 2015 Counsel for the defendant, Mr. Bennett, indicate that Mr. Bennett’s position is that the cause of the fire was the propane tank.

August 20, 2015 The plaintiffs advise Fiesta and Wolfedale of their belief that the propane tank was a potential cause of the fire and their intention to add Vomar as a defendant to the action. October 20, 2015 Vomar is served with the plaintiffs’ application to amend their statement of claim and add Vomar as a defendant. February 9, 2016 Hearing on the plaintiffs’ application is heard by Justice Chicoine. August 25, 2016 Two years have passed since Fiesta and Wolfedale were served with the plaintiffs’ original statement of claim.

August 11, 2017 Justice Chicoine dismisses the plaintiffs’ application to amend their statement of claim and add Vomar as a defendant: Amendment Application . November 22, 2017 Fiesta and Wolfedale file an application for leave to issue a third-party claim against Vomar. February 23, 2018 Justice Kalmakoff (as he then was) dismisses Fiesta and Wolfedale’s application for leave to issue a third-party claim against Vomar: 2018 SKQB 67 .

April 27, 2018 Justice Whitmore declines Fiesta and Wolfedale’s application to grant an extension of time to appeal Justice Chicoine’s August 11, 2017 decision and grants Fiesta and Wolfedale’s application for leave to appeal Justice Kalmakoff’s February 23, 2018 decision: Fiesta Barbeques Limited v Andros Enterprises Ltd. , 2018 SKCA 32 . November 5, 2019 The Court of Appeal of Saskatchewan allows Fiesta and Wolfedale’s appeal of Justice Kalmakoff’s February 23, 2018 and grants Fiesta and Wolfedale leave to file a third-party claim against Vomar: 2019 SKCA 114 .

November 22, 2019 Fiesta and Wolfedale file their third-party claim against Vomar. February 4, 2020 Vomar files an application dated January 21, 2020 for

summary judgment or, in the alternative, that the Fiesta and Wolfedale’s third-party claim be struck on the grounds that it is statute barred. III. Issues [ 17 ] Two principal issues fall to be decided on this application: (

a) Do the principles of discoverability operate in the context of a claim for contribution and indemnity brought pursuant to s. 14 of the Act ? (

b) If so, is the third-party claim which Fiesta and Wolfedale seek to commence statute-barred? [ 18 ] This fiat explains why I have concluded that:

(

a) The principles of discoverability identified in ss. 6(1) of the Act apply to third-party claims brought pursuant to s. 14; and (

b) On the facts of this case, Fiesta and Wolfedale’s claim for contribution and indemnity as against Vomar is statute-barred. IV. Discussion [19] The central issue on this application is whether the third-party claim commenced by Fiesta and Wolfedale isstatute-barred by virtue of the Act? Yet, before embarking on a considered analysis of this question, there are certain procedural issues toaddress. A. Preliminary Procedural Issues [20] First, Vomar has commenced an application seeking

summary dismissal of this third-party claim. As in anyapplication for

summary judgment, the first step is to determine if there is a genuine issue requiring a trial. This inquiry is required whenassessing applications for

summary judgment involving the operation of a limitation period. See, for example: Jardine v SaskatoonPolice Service, 2017 SKQB 217 [Jardine], and Tyszko v St. Catharines (City), 2023 ONSC 2892 at paras 9-11 and 67. [21] On this application neither counsel claimed it was not an appropriate candidate for

summary judgment. I haveindependently reviewed the record file and must agree with their assessment. [22] Second, and alternatively, Vomar seeks an order pursuant to Rules 7-9(2)(

b) and (

e) of The Queen’s BenchRules striking the third-party claim as an abuse of process because it is statute-barred by the Act. There plainly is Saskatchewan caseauthority supporting this aspect of Vomar’s application. See, for example: Walker v Mitchell, 2020 SKCA 127 at paras 24-25, [2021] 4WWR 555, and Luhning v Hnatyshyn, 2021 SKQB 17, and Jardine. [23] Third, and finally, it is important to establish that on Vomar’s application, Fiesta and Wolfedale bear the onus ofestablishing on a balance of probabilities that their third-party claim is not statute barred.

See: s. 18 of the Act, and Saskatchewan(Highways and Infrastructure v Venture Construction Inc., 2020 SKCA 39 at para 36, 447 DLR (4th) 316 [Venture Construction Inc.] B. Do the Principles of Discoverability Apply to Third-Party Claims for Contribution Under S. 14 of the Act? [24] The question of whether the principles of discoverability provided for in s. 6 of the Act apply to third-partyclaims for contribution and indemnity under s. 14 is novel, and has not been judicially considered by Saskatchewan courts, to date.

Toresolve it in a principled way consideration must be had to a number of relevant factors, not the least of which are modern principles ofstatutory

interpretation. See, especially: The Legislation Act, SS 2019, c L-10.2, s 2-10, and Equinav Financial Corporation v RoessleinEstate, 2020 SKCA 69 at para 36, 449 DLR (4th) 620, citing Rizzo & Rizzo Shoes Ltd. (Re), (SCC), [1998] 1 SCR 27,at para 27 [Rizzo]. 1 Law 1.1 Purpose of the Act [25] To contextualize the analysis which follows, it is helpful to identify the public policy objectives the Act seeks toachieve. These objectives are known as the certainty, evidentiary, and diligence rationales.

See: Novak v Bond, (SCC),[1999] 1 SCR 808, at paras 64-67 [Novak]; M.(K.) v M.(H.), (SCC), [1992] 3 SCR 6 at 29-31, and Canadian ImperialBank of Commerce v Green, 2015 SCC 60 at paras 57-58, [2015] 3 SCR 801 [Green]. [26] In Green, for example, Coté J. expanded on these three rationales at paras. 57-58 as follows: [57] This Court has generally recognized that limitation periods have three purposes known as the certainty, evidentiary and diligencerationales. . .Limitation periods serve “(1) to promote accuracy and certainty in the adjudication of claims; (2) to provide fairness topersons who might be required to defend against claims based on stale evidence; and (3) to prompt persons who might wish to commenceclaims to be diligent in pursuing them in a timely fashion”: P.

M. Perell and J. W. Morden, The Law of Civil Procedure in Ontario (2nded. 2014), at p. 123. [58] Clearly, it is desirable that litigation be accurate and certain, given that the passage of time dims memories and erodes evidence,and also that the risk of error grows as an adjudicator is further removed from the cause of action. Furthermore, after a certain time,possible defendants may be unaware of the need to preserve potentially enlightening or even exonerating pieces of evidence.

Finally, it isappropriate to expect plaintiffs to assert their claims diligently and to be cognizant of their circumstances and of the extent of their controlover them. Modern limitations legislation is therefore based on a recognition that limitation periods, in order to be effective, need to befinal. This is the other side of the coin, the practical consequence of limitation periods that can make the application of a limitationsstatute seem harsh[.] [Citations omitted] [27] In Novak, McLachlin J. (as she then was) listed “four characteristics” of modern limitation statutes. Thesecharacteristics are: (

a) to define a time at which potential defendants may be free of ancient obligations; (

b) to prevent the bringing of claims where the evidence may have been lost to the passage of time; (

c) to provide an incentive for plaintiffs to bring suits in a timely fashion; and (

d) to account for the plaintiff’s own circumstances.

[ 28 ] McLachlin J. stated further that provided these characteristics “are reflected in the particular words and structure of the statute in question, the best

interpretation of a limitations statute seeks to give effect to each of these characteristics ” (emphasis added): Novak at para 67 . At the same time, she cautioned: “Even on this new approach, however, limitation periods are not postponed on the plaintiff’s whim. There is a burden on the plaintiff to act reasonably”: Novak at para 65 . 1.2 Relevant Provisions of the Act [ 29 ] I will now review the provisions of the Act which are engaged on this application. [ 30 ] To begin, s. 5 of the Act sets out a general limitation period of two years following discovery of a claim. It reads: Basic limitation period 5.

Unless otherwise provided in this Act , no proceedings shall be commenced with respect to a claim after two years from the day on which the claim is discovered. [ 31 ] Subsection 6(1) of the Act identifies circumstances, or material factors, that point to when a claim is “discovered” for purposes of

section 5 . Subsection 6 (2) provides that knowledge of the circumstances identified in ss. 6(1) is presumed unless the contrary is proved. In its entirety, s. 6 reads as follows: Discovery of claim 6.

(1) Unless otherwise provided in this Act and subject to subsection (2), a claim is discovered on the day on which the claimant first knew or in the circumstances ought to have known: (

a) that the injury, loss or damage had occurred; (

b) that the injury, loss or damage appeared to have been caused by or contributed to by

an act or omission that is the subject of the claim; (

c) that the act or omission that is the subject of the claim appeared to be that of the person against whom the claim is made; and (

d) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it.

(2) A claimant is presumed to have known of the matters mentioned in clauses (1)(

a) to (

d) on the day on which the act or omission on which the claim is based took place, unless the contrary is proved. [ 32 ]

Section 7 of the Act sets out the ultimate limitation period. For present purposes, ss. 7(1) is the most relevant and reads as follows: Ultimate limitation periods 7

(1) Subject to subsections (2) to (4), with respect to any claim to which a limitation period applies, no proceeding shall be commenced after 15 years from the day on which the act or omission on which the claim is based took place. [ 33 ]

Section 14 expressly deals with third party claims for contribution and indemnity. This

section makes clear that the day the claim is served on a defendant by a plaintiff is critical. In its entirety, s. 14 reads as follows: Contribution and indemnity 14

(1) 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 with respect to which contribution and indemnity is sought is deemed to be the day on which 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 with respect to a tort or otherwise. 1.3 Relevant Saskatchewan Case Authority [ 34 ] The inter-play of ss. 5 and 6 of the Act , for example, was recently considered by our Court of Appeal in Nadeau v Nadeau , 2021 SKCA 69 [ Nadeau ].

Ottenbreit, J.A. for the court, observed that s. 5 “makes it clear that the limitation period for all claims begins to run when the claim is discovered.

Section 5 establishes the concept of discoverability as a determiner of when a limitation period begins to run.” (Emphasis added). See: Nadeau at para 33 . [ 35 ] Turning to s. 6 of the Act , Ottenbreit J.A. had this to say at para. 36: [36] … A person is presumed to know of [the factors in s. 6(1)] on the day on which the act or omission on which the claim is based took place unless the contrary is proved (s. 6(2)). In short, the cumulative criteria in s. 6 provide the trigger date for when the limitation period will start to run, i.e., when the claim is discovered.

These discoverability factors apply to all claims , including those made for repayment of a demand loan. … [Emphasis added] [ 36 ] It appears, however, that s. 14 of the Act has been considered only twice by the courts of this province: Winacott Spring Western Star Trucks v Moore Industrial Ltd ., 2013 SKCA 88 , [2014] 1 WWR 755 [ Winacott ], and Case v Rotelick , 2018 SKQB

242 , 31 CPC (8th) 401 [ Case ]. [ 37 ] In Winacott , the plaintiff fell off a ladder and sued the owner of the ladder – Winacott – for damages flowing from his injuries. Winacott, in turn, sought contribution and indemnity from Moore Industrial Ltd. from whom he had purchased the ladder, and from Sturdy Ladder Inc., the company which had sold the ladder to Moore Industrial Ltd. The issue was whether Winacott’s third-party claim was statute barred. [ 38 ] The Court of Appeal upheld the judge at first instance who had found Winacott’s third-party claim to be statute- barred.

Writing for the court, Herauf J.A. stated at para. 30: [30] … In this case, the date of service on Winacott was April 11, 2007…Pursuant to s. 14 of The Limitations Act , the limitation period ended on April 11, 2009 and since there was not service prior to that date, Winacott’s actions against Moore and Sturdy is statute barred.

He underscored at para. 32 that “Winacott’s claim for contribution is deemed by s. 14 to have been discovered on April 11, 2007”. [ 39 ] Case involved a claim against a group of defendants whom the plaintiffs alleged were responsible to the Canada Revenue Agency for substantial and unanticipated tax consequences visited upon them.

After the statement of claim was issued, the defendants and proposed third-party defendants entered into a tolling agreement which could be terminated 30 days after the effective date of the notice. [ 40 ] Subsequently, the defendants’ filed their statement of defence, and an application for leave to issue a third-party claim a few days after the two-year limitation period expired. Elson J. denied this application and found the defendants had failed to comply with the limitation period set out in s. 14 of the Act .

He stated at paras. 45-46 as follows: [45] At the outset, I agree with the calculation of the s. 14 limitation set out in the written brief filed by the defendants’ counsel. By that calculation, the clock did not begin to run until April 9, 2013, being the date the statement of claim was served on the defendants, as stipulated in the Tolling Agreement. Parenthetically, I note that, by s. 14 , this date is “deemed” to be the appropriate starting point, something that applies irrespective of Mr.

Rotelick’s acknowledgement that he was aware of the potential claim well before his firm was served. [46] Calculating the basic two-year limitation period from April 9, 2013, it would have expired, but for the Tolling Agreement, by April 10, 2015. The beginning of the Tolling Period interrupted that limitation period as of, and including, March 30, 2015. Immediately before the Tolling Period, there were 11 days left in the applicable limitation. When the Tolling Period formally ended, at the end of the day of April 20, 2017, the remaining 11 days of the limitation resumed.

By the calculation of the defendants’ counsel, which I accept, that limitation would not have expired until the end of the day on May 1, 2017. To use the language in The Limitations Act , such as ss. 5 and 7 , that is the date after which “no proceedings shall be commenced”. 1.4 Jurisdictional Comparators [ 41 ] Each province and territory in Canada has enacted a limitation statute. These statutes may be classified in one of two ways. The first group comprises statutes that stipulate limitation periods based on specific categories of actions.

See: The Limitations Act , CCSM, c L150 , s 2(2); The Limitations Act , SNL 1995, c L-16.1 , ss 8–10; Statute of Limitations , RSPEI 1988, c S-7 , s 2; Limitation of Actions Act , RSY 2002, c 139 , s 2; The Limitation of Actions Act , RSNWT 1988, c L-8 , s 2; The Limitation of Actions Act , RSNWT (Nu) 1988, c L-8 , s 2. [ 42 ] These limitations statutes are distinct from the Act so

interpretations given to those statutes by courts of the respective jurisdictions do not assist in resolving the issue on this application. [ 43 ] The second group comprises statutes that unless otherwise provided, set forth a basic, and generally applicable, limitation period for all claims which will be triggered by the principle of discoverability. In addition to the Act , this group includes legislation in British Columbia, Alberta, Ontario, New Brunswick, and Nova Scotia.

See: Limitation Act , SBC 2012, c 13 , ss 6, 8; Limitations Act , RSA 2000, c L-12 , s 3; Limitations Act, 2002 , SO 2002, c 24 , ss 4–5; Limitation of Actions Act , SNB 2009, c L-8.5, s 5, and Limitation of Actions Act , SNS 2014, c 35 , s 8. [ 44 ] Generally, each of these statutes includes a provision stipulating the limitation period applicable to a claim by a defendant for contribution or indemnity against another alleged defendant.

The British Columbia, Alberta and New Brunswick statutes expressly include the principle of discoverability into the limitation period relating to claims for contribution or indemnity. See: Limitation Act , SBC 2012, c 13 , s 16; Limitations Act , RSA 2000, c L-12 , s 16, and Limitation of Actions Act , SNB 2009, c L-8.5 , s14. [ 45 ] Limitation statutes from those provinces are distinguishable for present purposes because the Act , the Ontario statute and the Nova Scotia statute do not expressly import the principles of discoverability into the limitation period for claims for contribution or indemnity.

See: Limitations Act, 2002 , SO 2002, c 24 , s 18 [ OLA ], and Limitation of Actions Act , SNS 2014, c 35 , s 15 [ NSLAA ]. For ease of reference, I reproduce the relevant sections of those statutes in the chart below: OLA NSLAA

Discovery 5

(1) A claim is discovered on the earlier of, (

a) the day on which the person with the claim first knew, (

i) that the injury, loss or damage had occurred, (ii) that the injury, loss or damage was caused by or contributed to by

an act or omission, (iii) that the act or omission was that of the person against whom the claim is made, and (iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and (

b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a). Presumption

(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1)(

a) on the day the act or omission on which the claim is based took place, unless the contrary is proved. ... Ultimate limitation periods 15

(1) Even if the limitation period established by any other

section of this Act in respect of a claim has not expired, no proceeding shall be commenced in respect of the claim after the expiry of a limitation period established by this section.

(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. Contribution and indemnity 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 General rules 8

(1) Unless otherwise provided in this Act , a claim may not be brought after the earlier of (

a) two years from the day on which the claim is discovered; and (

b) fifteen years from the day on which the act or omission on which the claim is based occurred. ... Contribution and indemnity 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 is served with the claim in respect of which contribution and indemnity is sought, or incurs a liability through the settlement of the claim, is, for the purpose of clause 8(1)(b), the day on which the act or omission on which the claim for contribution and indemnity is based occurs. [ 46 ] Turning to judicial consideration of these provisions in the NSLAA , and the OLA , respectively, it is evident that the jurisprudence from these two provinces is informative, if not authoritative.

Fiesta and Wolfedale, for example, cited Sears v Top O’the Mountain Apartments Limited , 2021 NSSC 80 [ Sears ] as illustrative of how I might interpret s. 14 of the Act . [ 47 ] In Sears , a slip and fall case, Norton J. carefully reviewed the legislative history of the recently enacted NSLAA .

He noted that prior to its enactment, the provincial Department of Justice had issued a Discussion Paper on Limitation of Actions Act (Halifax: Nova Scotia Department of Justice, April 2011) which recommended following the approach adopted in Ontario and Saskatchewan respecting the ultimate limitation period for a claim for contribution and indemnity. This approach used the trigger of service of a statement of claim to start the limitation period running, and to apply it to the ultimate limitation period. See: Sears at para 32 .

[48] The court then proceeded to elaborate on differences between the Ontario and Saskatchewan statutes, and theNSLAA. At para. 35, Norton J. opined: [35] There are two significant differences between the Acts in these provinces and the Nova Scotia LAA [Limitation of Actions Act,SNS 2015, c 22]. The Ontario and Saskatchewan legislation both include a provision creating a presumption that a claim is “discovered”– as that concept is defined in the Act – on the day on which the act or omission on which the claim is based took place.

For the purposesof a claim for contribution and indemnity, then, it is presumed that the claim is discovered on the day on which the first allegedwrongdoer was served with the claim with respect to which contribution and indemnity is sought. The second difference is that both theOntario and Saskatchewan Acts include a subsection which states that the contribution and indemnity provision applies whether the rightto contribution and indemnity arises with respect to a tort or otherwise. In other words, the

section applies to claims based in contract aswell as in tort. [Emphasis added] [49] At para. 54 of Sears, Norton J. reiterated that “it is presumed, under the Ontario and Saskatchewan legislationthat the contribution and indemnity claim is discovered on the day the act or omission on which the claim is based took place (that is, theday the first wrongdoer is served)”. [50] There is a large body of jurisprudence interpreting the OLA.

Respecting s. 18 of the OLA, for example, in theleading case of Canaccord Capital Corporation v Roscoe, 2013 ONCA 378, 363 DLR (4th) 182 [Roscoe] the Ontario Court of Appealtracked its’ legislative evolution. The specific issue presented in Roscoe was whether s. 18 permitted a claim for contribution andindemnity in cases involving a contractual breach. Writing for the court, Sharpe J.A. determined it did.

He elaborated at paras. 16-17 and27-28, as follows: [16] A brief review of the evolution of the legislation governing the limitation period applicable to claims for contribution andindemnity will facilitate my analysis of s. 18. The legislature first dealt specifically with claims for contribution and indemnity asbetween tortfeasors in 1948.

An Act to amend The Negligence Act, S.O. 1948, c. 61, s. 3 amended The Negligence Act, R.S.O 1937, c.115, and extended the limitation period for claims for contribution and indemnity by one tortfeasor against another by providing thatsuch a claim could be brought within one year of the date of judgment or settlement disposing of the underlying tort claim despite theoperation of any limitation period against the other tortfeasor: see HSBC Securities (Canada) Inc. v. Davies, Ward & Beck (2005), (ON CA), 74 O.R. (3d) 295, [2005] O.J. No. 277 (C.A.), at para. 56.

This provision was included in successive versions ofthe Negligence Act and remained in force for over 50 years until the Act was passed in 2002 and repealed the provision: Justice StatuteLaw Amendment Act, 2002, S.O. 2002, c. 24, Sch. B, s. 25. [17]

Section 18 of the Act [Limitations Act, 2002, SO 2002, c 24, Sch B] reflects two significant changes relating to the limitation periodapplicable to claims for contribution and indemnity. First, s. 18 was part of a fundamental and comprehensive reform of the law oflimitations in Ontario aimed at creating a clear and cohesive scheme for addressing limitation issues, one that balances the plaintiff’sright to sue with the defendant’s need for certainty and finality.

Second, the wording of s. 18 is significantly different from the provisionit replaced. ... [27] When s. 18 is read harmoniously with the scheme and object of the Act and the intention of the legislature, the conclusion thatCanaccord’s claim against Roscoe is governed by s. 18 gains added strength. As I have noted, the Act reflects a marked departure fromthe past when different limitation periods were found in different statutes and based upon the characterization of the specific cause ofaction pleaded.

The Act achieved a significant reform by eliminating that plethora of limitation periods and replacing them with a “basiclimitation period” based upon the discovery of the claim. [28]

Section 18 creates a specific rule for determining when a claim for contribution and indemnity is discovered.

Section 18 providesthat a claim for contribution and indemnity is discovered on the day the first alleged wrongdoer is served with the claim in respect ofwhich contribution and indemnity is sought. In other words, once the party seeking indemnity is served with the injured party’s statementof claim, the claim is discovered and the two-year limitation period starts to run. Section 18(2) makes clear that this special rule forclaims for contribution and indemnity “applies whether the right to contribution and indemnity arises in respect of a tort or otherwise”(emphasis added).

The legal theory grounding the contribution and indemnity claim is not relevant for deciding whether s. 18 istriggered; the provision applies when there is a claim for contribution and indemnity, no matter what legal theory underlies the claim. [Italics in original, underlining added] [51] Admittedly, Roscoe could be read as establishing an absolute two-year limitation period for any claim forcontribution and indemnity commenced in Ontario. Indeed, the judge at first instance in Mega International v Yung, 2017 ONSC 1005interpreted it exactly this way.

However, on appeal, the Ontario Court of Appeal determined that this was inaccurate. See: MegaInternational Commercial Bank (Canada) v Yung, 2018 ONCA 429, 425 DLR (4th) 439 [Mega] [52] In Mega, Paciocco J.A. for the court opined particularly at para. 54 that: [54] In my view, the motion judge erred in law in holding that the Limitations Act, 2002, s. 18 creates an absolute limitation period oftwo years for the commencement of contribution and indemnity claims.

Properly interpreted, s. 18 works with other provisions of theLimitations Act, 2002, to create a presumed start date for the running of the limitation period.

That presumed limitation period start datewill result in a claim for contribution or indemnity being statute-barred two years after the party seeking contribution or indemnity isserved with a claim in the proceeding in which contribution or indemnity is sought, unless that party proves that the claim forcontribution or indemnity was not discovered and was not capable of being discovered through the exercise of due diligence until somelater date. [53] Paciocco J.A. admitted that lower court authority in Ontario was divided on this question. See: Mega at paras

57-58. However, he then proceeded to resolve this division. His analysis begins at para. 59 as follows: [59] The

interpretation of s. 18 therefore falls to be determined by applying the principles of statutory

interpretation affirmed in Rizzo &Rizzo Shoes Ltd. (Re) (1998), (SCC), 36 O.R. (3d) 418, [1998] 1 S.C.R. 27, [1998] S.C.J. No. 2, at para. 21, citing E.A.Driedger, Construction of Statutes, 2nd ed. (Toronto: Butterworths, 1983), at p. 87: Today there is only one principle or approach, namely, the words of

an Act are to be read in their entire context and in their grammaticaland ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. See, also, Bell ExpressVu Ltd. Partnership v. Rex, [2002] 2 S.C.R. 559, [2002] S.C.J. No. 43, 2002 SCC 42, at para. 26; Sun IndalexFinance, LLC v. United Steelworkers, [2013] 1 S.C.R. 271, [2013] S.C.J. No. 6, 2013 SCC 6, at para. 136; and Schnarr v. Blue MountainResorts Ltd. (2018), 140 O.R. (3d) 241, [2018] O.J.

No. 1664, 2018 ONCA 313, at para. 23. ... [61] The words in s. 18, interpreted in their grammatical and ordinary sense, do not establish an absolute limitation period. Theprovisions in the Limitations Act, 2002 that do establish finite limitation periods, such as ss. 4, 15(1), 15(2) and 15(3), direct that "aproceeding shall not be commenced" or "no proceeding shall be commenced" after a described limitation period.

Section 18, on the otherhand, does not use such language or speak in any other terms that can be read as imposing an absolute limitation period, nor does it evenidentify a time span that could serve as a limitation period. [62] On its face, s. 18 does no more than deem a fact without disclosing the significance of that deemed fact. Specifically, it directs thatthe day on which a party is served with the claim in respect of which they seek contribution or indemnity, is deemed to be the day the actor omission on which that alleged claim is based took place.

As this court similarly described in Levesque [Levesque v Crampton Estate,2017 ONCA 455, 136 OR (3d) 161], at para. 39, s. 18 is obviously intended to work harmoniously along with other provisions of theLimitations Act, 2002 to give this deemed fact meaning. [63] In my view, s. 18 takes on meaning when it is linked to the Limitations Act, 2002, s. 5(2).

Subject to the absolute 15-year limitationperiod in s. 15(2), ss. 5(2) and 18 together establish the presumptive limitation period for contribution and indemnity claims -- apresumptive limitation period that incorporates the discoverability principles outlined in ss. 4 and 5(1) … ... [67] Sections 18 and 5(2), in my view, work hand in glove in contribution or indemnity claims.

Together, these two provisions [page96]identify the presumptive limitation period that applies in contribution and indemnity claim cases. [68] In this way, s. 18 works not as an exception to the "basic limitation period" in s. 4 of the Limitations Act, 2002, but as part of theintegrated scheme established by ss. 4 and 5. [54] Ultimately, Paciocco J.A. opined that to interpret s. 18 of the OLA as creating an absolute limitation period forclaims for contribution and indemnity could be unjust in some cases.

He said at para. 73: [73] Indeed, I agree with the observations of Leach J. in Demide [Demide v Canada (Attorney General), 2015 ONSC 3000, 47 CLR(4th) 126], at para. 88. There is an element of injustice in using a limitation period to deny a claim that could not have beendiscovered with reasonable diligence, and "the court should be reluctant to adopt a legislative

interpretation that effectivelypermits the possibility of such an injustice, unless that is the outcome clearly dictated by the legislation". In my view, that outcomeis not clearly dictated by s. 18. On the contrary, the opposite outcome is indicated. [Emphasis added] 2 Analysis and Application of Principles [55] To begin, Winacott and Case stand for the proposition that the limitation period for third-party claims begins torun the day the defendant is served with the plaintiff’s statement of claim.

Herauf J.A. made this point explicitly in Winacott when hestated that a third-party claim under s. 14 of the Act is “deemed” to be discovered on the day when a defendant is served with a statementof claim. [56] To be sure, in Case, this period was extended for a short time by a tolling agreement between the parties.However, as in Winacott, the date when the limitation period began was the date the statement of claim was served upon the defendants. [57] That much is clear.

Section 14 of the Act is not stand-alone provision, however. Put another way, reference mustbe had to other provisions of the Act to give meaning to

section 14. For ease of reference, I reproduce s. 14 below: 14(1) In the case of a claim by one alleged wrongdoer against another for contribution and indemnity, the day on which the first allegedwrongdoer was served with the claim with respect to which contribution and indemnity is sought is deemed to be the day on which theact 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 with respect to a tort or otherwise. [58]

Section 14 does not stipulate a limitation period. It merely deems a fact. Rather, it is necessary to refer to s. 5 ofthe Act to determine the operative limitation period. Without regard to s. 5, s. 14 would be meaningless. [59]

Section 7 of the Act sets out the ultimate limitation period, while s. 5 provides that this limitation period runs fortwo years following the discovery of the claim. Fiesta and Wolfedale assert that because s. 5 refers to discovery of a claim as the startingpoint, the principles of discoverability codified in ss. 6(1) are implicitly incorporated into its

interpretation. This, it would seem, is the

lesson to be drawn from Nadeau. [60] For its part, Vomar argues that because the text of s. 18 of the OLA differs from the text of s. 14 of the Act,Mega is distinguishable and Ontario jurisprudence should not be utilized as an interpretive guide. Although Vomar acknowledges thatboth provisions deem a fact, namely when the limitation period commences, that is where any similarity ends. Vomar argues further thats. 18 of the OLA expressly references s. 5 (discovery) and s. 15 (ultimate limitation period) of the OLA while s. 14 of does not incorporate complementary provisions of theAct.

Consequently, the discussion in Mega respecting the relevance of those two provisions is inapplicable to the Act. [61] Respectfully, I disagree with Vomar’s submissions. Since it is necessary to look to s. 5 of the Act to determinethe appropriate basic limitation period in order to understand, and interpret, s. 14, it would be illogical not to have regard to thediscoverability principles set out in s. 6. These principles are expressly referenced in

section 5, and to ignore them invites a crabbedinterpretation of the basic limitation period, and an incongruous result. As the court stated in Rizzo at para 27: 27 ... It is a well established principle of statutory

interpretation that the legislature does not intend to produce absurd consequences…[A]n

interpretation can be considered absurd if it leads to ridiculous or frivolous consequences, if it is extremely unreasonable orinequitable, if it is illogical or incoherent, or if it is incompatible with other provisions or with the object of the legislativeenactment. … [Emphasis added] [62] The

interpretation of these provisions advanced by Vomar, in my view, invites a reading of s. 14 of the Actwhich is “incompatible with other provisions or the object of the legislative enactment” [Rizzo at para 27] in question. By arguing that s.14 creates an absolute limitation period of two years for all claims for contribution and indemnity, Vomar privileges the objective ofcertainty above the other important public policy objectives of limitation statutes. As well, as the Ontario Court of Appeal in Megaobserved at para. 73, such an

interpretation holds the real potential of visiting an injustice upon otherwise diligent litigants. [63] Accordingly, I find that the discoverability principles identified in s. 6 of the Act apply to claims for contributionand indemnity under s. 14. For this reason, Ontario jurisprudence, while not binding on me, is instructive when addressing the remainingissues presented on this application. C.

Is Fiesta and Wolfedale’s Third Party Claim Statute Barred? [64] Having determined that the discoverability principles codified in s. 6 of the Act are applicable to s. 14, I mustdecide if Fiesta and Wolfedale’s third-party claim against Vomar was commenced within a two year period after its’ initial discovery. Aselaborated below, I conclude it was not.

Consequently, it is statute-barred. 1 Law [65] Limitation periods are driven by when the “material facts on which [a cause of action] is based have beendiscovered or ought to have been discovered by the plaintiff by the exercise of reasonable diligence”: Central Trust Co. v Rafuse, (SCC), [1986] 2 SCR 147 at 224. See also Grant Thornton LLP v New Brunswick, 2021 SCC 31 at paras 29 and 42, 461 DLR(4th) 613 [Grant Thornton]. Discoverability implies knowledge of facts that may give rise to the claim.

The knowledge required to startthe limitation running is “more than suspicion and less than perfect knowledge”: Vu v Canada (Attorney General), 2021 ONCA 574, atpara 47, 495 CRR (2d) 1 [Vu], quoting Zeppa v Woodbridge Heating & Air-Conditioning Ltd., 2019 ONCA 47 at para 41, 144 OR (3d)385. [66] Any claimant relying upon the discoverability principle is obligated to exercise reasonable diligence whenpursuing a legal claim. See: Langenburg (Town) v Gamey, 2010 SKCA 11 at para 28, [2010] 8 WWR 273. This obligation applies, aswell, to defendants seeking to bring a third-party claim.

It follows that once the second anniversary of the claim passes, the onus shifts tothe party seeking contribution and indemnity to establish why this claim was not discoverable within that time-period. See, for example:Albert Bloom Limited v London Transit Commission, 2021 ONCA 74 at paras 24 and 40. [67] When analyzing reasonable diligence, two overarching analytical questions need to be addressed. First, would areasonable person with the skills and abilities of the claimant have taken steps to determine if there were grounds for an application oraction to remedy the injury, loss or damage suffered.

See, for example: Jardine at paras 35-36. [68] Second, if it is determined that a reasonable person in the claimant’s shoes would have taken steps to protect hisor her interest, the issue becomes whether the party ought to have discovered the claim at some time before the expiry of the two-yearlimitation period. In claims for contribution and indemnity, this would be two years from the date the statement of claim is issued. [69] If the answer to these two inquiries is “yes” then the claim is statute-barred.

However, if the answer to eitherquestion is “no”, the claimant has satisfied its burden under s. 18 of the Act, and the limitation period will be tolled. [70] As the Ontario Court of Appeal in Vu stated at para. 47 knowledge beyond mere suspicion but less than actualknowledge is sufficient to trigger the discoverability rule.

Put another way, “the requirement for due diligence means that having asuspicion about certain facts will be enough to put a plaintiff on notice, or trigger a need for further investigation or inquiry”: A.S. vArslan, 2019 SKQB 94 at para 85, [2020] 2 WWR 131. [71] The Supreme Court speaking through Moldaver J. in Grant Thornton elaborated on a party’s requisite state ofknowledge for purposes of the discoverability rule. At paras. 44-46, he stated: [44] In assessing the plaintiff’s state of knowledge, both direct and circumstantial evidence can be used.

Moreover, a plaintiff will haveconstructive knowledge when the evidence shows that the plaintiff ought to have discovered the material facts by exercising reasonable

diligence. Suspicion may trigger that exercise (Crombie Property Holdings Ltd. v. McColl-Frontenac Inc., 2017 ONCA 16, 406 D.L.R.(4th) 252, at para. 42). [45] Finally, the governing standard requires the plaintiff to be able to draw a plausible inference of liability on the part of the defendantfrom the material facts that are actually or constructively known.

In this particular context, determining whether a plausible inference ofliability can be drawn from the material facts that are known is the same assessment as determining whether a plaintiff “had all of thematerial facts necessary to determine that [it] had prima facie grounds for inferring [liability on the part of the defendant]” (Brown v.Wahl, 2015 ONCA 778, 128 O.R. (3d) 583, at para. 7; see also para. 8, quoting Lawless v. Anderson, 2011 ONCA 102, 276 O.A.C. 75,at para. 30).

Although the question in both circumstances is whether the plaintiff’s knowledge of the material facts gives rise to aninference that the defendant is liable, I prefer to use the term plausible inference because in civil litigation, there does not appear to be auniversal definition of what qualifies as prima facie grounds. … [46] The plausible inference of liability requirement ensures that the degree of knowledge needed to discover a claim is morethan mere suspicion or speculation.

This accords with the principles underlying the discoverability rule, which recognize that it isunfair to deprive a plaintiff from bringing a claim before it can reasonably be expected to know the claim exists. At the sametime, requiring a plausible inference of liability ensures the standard does not rise so high as to require certainty of liability(Kowal v. Shyiak, 2012 ONCA 512, 296 O.A.C. 352) or “perfect knowledge” (De Shazo [De Shazo v Nations Energy Co., 2005 ABCA241, 48 Alta LR (4th) 25], at para. 31; see also the concept of “perfect certainty” in Hill v.

South Alberta Land Registration District(1993), 1993 ABCA 75 , 8 Alta. L.R. (3d) 379, at para. 8). Indeed, it is well established that a plaintiff does not need to knowthe exact extent or type of harm it has suffered, or the precise cause of its injury, in order for a limitation period to run (HOOPP RealtyInc. v. Emery Jamieson LLP, 2018 ABQB 276, 27 C.P.C. (8th) 83, at para. 213, citing Peixeiro [Peizeiro v Haberman, (SCC), [1997] 3 SCR 549], at para. 18). [Emphasis added] [72] The Court of Appeal in Venture Construction Inc. stated that the list of factors in ss. 6(1)(

a) to 6(1)(

d) of the Actis cumulative, not disjunctive. This means that a limitation period does not start to run “until a claimant knows, or ought to have known,that all of the factors enumerated in s. 6(1) of the Act have been established” (emphasis in original): Venture Construction Ltd. at para55. See also: Grant Thornton at para 43.

As regards, suspicion and diligence, it may be that when a claimant suspects a third-party mayexist, there is an obligation to pursue information relating to each of the factors identified in ss. 6(1). 2 Analysis and Application of Principles [73] On this aspect of the application, it is necessary to determine if Fiesta and Wolfedale have proved on a balanceof probabilities that the limitation period was tolled from August 24, 2014 (the day the statement of claim was served on them) toNovember 22, 2015 (two years before they served their application for leave to issue the third-party claim against Vomar).

This analysisrequires a consideration of the factors listed in ss. 6(1) of the Act. [74] For ease of reference, I reproduce ss. 6(1) below: Discovery of Claim 6.

(1) Unless otherwise provided in this Act and subject to subsection (2), a claim is discovered on the day on which the claimant firstknew or in the circumstances ought to have known: (

a) that the injury, loss or damage had occurred; (

b) that the injury, loss or damage appeared to have been caused by or contributed to by

an act or omission that is the subject ofthe claim; (

c) that the act or omission that is the subject of the claim appeared to be that of the person against whom the claim is made; and (

d) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek toremedy it. 2.1 Subsection 6(1)(a) – Knowledge of Injury, Loss or Damage [75] Subsection 6(1)(

a) requires determining when Fiesta and Wolfedale first knew or ought to have known that “theinjury, loss or damage had occurred”. This injury, loss or damage must have been caused by or contributed to by the act or omission of athird party.

Section 14 of the Act makes plain it occurs on the day the alleged wrongdoer is served with the statement of claim uponwhich the third-party claim may be based. See, for example: Sears at para 56. [76] Consequently, it is reasonable to conclude that for purposes of a claim for contribution and indemnity under s.14, ss. 6(1)(

a) is satisfied when the statement of claim is served on the defendants. For present purposes the operative date of whenFiesta and Wolfedale ostensibly learned that injury, loss or damage had occurred is August 25, 2014, the date they were served with thestatement of claim. 2.2 Subsections 6(1)(

b) and (c) – Knowledge of Wrongful Act and Wrongdoer [77] Once a claimant’s “injury, loss or damage” is identified, ss. 6(1)(

b) of the Act looks to whether the claimantknew or ought to have known that it “appeared to have been caused by or contributed to by

an act or omission that is the subject of theclaim”. This factor has been characterized as the “causal link” between the claimant’s injury, loss or damage, and the act or omissionreferred to in s. 6(1)(b). See, for example: Lorencz v Talukdar, 2017 SKQB 389 at para 36.

[ 78 ] Here, ss. 6(1)(

b) requires Fiesta and Wolfedale to demonstrate that they did not know that a causal link seemed to exist between the cause of action alleged in the statement of claim and

an act or omission by a potential third party prior to the expiry of the limitation period. See: Venture Construction Inc. v Saskatchewan (Highways and Infrastructure) , 2018 SKQB 293 at para 53 , 95 CLR (4th) 263 [ Venture Construction QB ], rev’d Venture Construction Inc . but not on this point. [ 79 ] Subsection 6(1)(

c) considers whether the claimant knew, or ought to have known that the act or omission “appeared to be that of the person against whom the claim is made”. In Venture Construction QB , for example, the issue was whether the plaintiff could be said to have conclusively identified the party or parties who had contributed to its loss. McCreary J. (as she then was) found that the plaintiff knew of potential acts or omissions responsible for its loss, and its knowledge of only two defendants who could have reasonably committed the wrongful action indicated the plaintiff “knew enough. . .to satisfy ss. 6(1) (

b) and (

c) of the Act ”: Venture Construction QB at para 53 . [ 80 ] Vomar submits that as of August 25, 2014, Fiesta and Wolfedale knew that an injury, loss or damage had occurred and it appeared that it had been caused by, or contributed to by, a defect in the propane tank based upon the following factual allegations in the statement of claim: (

a) The fire occurred when the defendant, Mr. Bennet was using a barbeque on the balcony of his apartment unit; (

b) The barbeque was attached to a propane tank at the time of the fire; (

c) This tank was materially involved in the fire as it was the fuel source for the ensuing fire; (

d) The flames erupted when the main valve of the tank was being turned off; (

e) The flames, smoke and water caused considerable property damage, and the plaintiffs sued Mr. Bennett alleging negligent installation and assembly of the propane tank, and the manufacturer and distributor of the barbeque for causing the fire; and (

f) The plaintiffs incurred losses of over $2,000,000. They sought this amount in damages from Mr. Bennett, Fiesta, and Wolfedale based on their negligence. [ 81 ] It may be plausible that as of August 25, 2014, Fiesta and Wolfedale did not have a well-grounded suspicion the propane tank was the source of the fire. To be sure, the plaintiffs’ statement of claim stated at para. 6 that the fire occurred when the defendant, Mr. Bennett “was turning off the main valve of the propane tank [and] flames erupted from the Fiesta BBQ”.

Although, as the tank was the only component containing flammable material, it may well be that Fiesta and Wolfedale lacked diligence in pursing the provenance of the propane tank in question, and why it caught fire in the circumstances alleged in the plaintiffs’ statement of claim. [ 82 ] However, this argument loses considerable force when the circumstances surrounding the discovery of the fire marshal’s report described as “Letter from the City of Regina and enclosed redacted copy of Fire Department Report” dated September 24, 2012.

This document was identified as document #13 in the plaintiffs’ affidavit of documents which was served on the defendants on or about December 22, 2014. [ 83 ] On May 12, 2015, Fiesta and Wolfedale were told by the defendant, Mr. Bennett at a mediation, that the cause of the fire was the propane tank. Clearly by then Fiesta and Wolfedale not only had a suspicion but had knowledge that Vomar was implicated in the damage suffered by the plaintiffs.

Yet, according to the materials filed on this application, even after learning all this information, Fiesta and Wolfedale appear to have taken no steps to seek out further information respecting the role the propane tank and what its requalifying by Vomar may have contributed to the fire. [ 84 ] Subsequently, on August 20, 2015, the plaintiffs advised Fiesta and Wolfedale that because they believed the propane tank was likely the cause of the fire, they were applying to add Vomar as a defendant. Consequently, by this date Fiesta and Wolfedale had actual knowledge of Vomar’s identity.

It is debatable whether Fiesta and Wolfedale failed to act diligently in determining Vomar’s identity after they were notified by Mr. Bennett on May 12, 2015 that the propane tank was the cause of the fire. However, and giving the benefit of the doubt to Fiesta and Wolfedale, there can be no question that they possessed absolute knowledge of this fact, and of Vomar’s potential liability as of August 20, 2015 , at the very latest. 2.3 Subsection 6(1)(d) – Legally Appropriate to Proceed with Claim [ 85 ] The last criterion for a claim to be discovered and a limitation period triggered is set out in ss. 6(1) (

d) of the Act . It requires consideration of when it was legally appropriate to commence proceedings. [ 86 ] Recently, in Venture Construction Inc. , the Court of Appeal per Kalmakoff J.A. reviewed the law related to ss. 6(1) (d). For “discovery” to occur, the claimant must have known, or ought to have known, “that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it.” According to Kalmakoff J.A., the

section “[i]s a legislative recognition that, in some cases, there may be compelling and appropriate reasons for a plaintiff to hold off on bringing an action, even when all the other elements of discoverability are fulfilled.” See: Venture Construction Inc. at para 63 . [ 87 ] The Ontario Court of Appeal, for example, has interpreted “appropriate” to mean “legally appropriate”. See, for example, Markel Insurance Company of Canada v ING Insurance Company of Canada , 2012 ONCA 218 at para 34 , 348 DLR (4th) 744 [ Markel Insurance Company ].

It follows that a proceeding is not legally appropriate where alternative avenues for remedying a plaintiff’s or a claimant’s injury, loss or damage are available. See: Venture Construction Inc. at para 72 . [ 88 ] Put another way, ss. 6(1) (

d) may delay the operation of a limitation period provided there is a juridical reason justifying the plaintiff’s or the claimant’s decision to wait. A juridical reason means there must be an explanation rooted in law as to why commencing a proceeding was not yet appropriate. See: Markel Insurance Company ; Pepper v Sanmina-Sci Systems (Canada) Inc., 2017 ONSC 1516 at para 65 , 65 CCLI (5th) 248; and Venture Construction QB at para 55 .

[ 89 ] Determining when it is “legally appropriate” to commence an action depends on the factual matrix of each case, including taking into account the particular interests and circumstances of the plaintiff: 407 ETR Concession Company Limited v Day , 2016 ONCA 709 , 403 DLR (4th) 385. Because analyses under ss. 6(1) (

d) of the Act , or similar legislation, are so fact specific, case law applying this legislation to different factual contexts, is of limited assistance: Brown v Baum, 2016 ONCA 325 at para 41 , 397 DLR (4th) 161. Nevertheless, courts have held that a proceeding is not legally appropriate until other dispute resolution mechanisms, including statutory or contractual remedies, have been exhausted.

See: Venture Construction Inc. at paras 67- 70 . [ 90 ] Turning to the facts of this case, Fiesta and Wolfedale should have identified Vomar as contributing to the damage suffered by the plaintiffs on May 12, 2015 – the date on which the plaintiffs, at mediation, advised them that the tank was the cause of the fire – or August 20, 2015, at the latest.

Yet, Fiesta and Wolfedale did not file their application for leave to file a third-party claim until November 22, 2017, more than two years later. [ 91 ] As of August 20, 2015, Fiesta and Wolfedale had to know a legal proceeding would be the appropriate means to attempt to mitigate their loss. They knew they were defending a claim predicated on the theory that the barbeque they manufactured and distributed, had malfunctioned causing the fire in question.

Given the absence of any appropriate alternative resolution mechanisms, if Fiesta and Wolfedale wanted to avail themselves of their right to have a third party contribute to a potential adverse judgment, a “proceeding” would not only be legally appropriate, but necessary. [ 92 ] Fiesta and Wolfedale assert that the plaintiffs’ application to have Vomar added as a party defendant – the Amendment Application – provided them with a juridical reason to await its’ outcome, before requiring them to proceed with an application to allow a third-party claim, should the plaintiffs’ application fail (which it did). [ 93 ] Yet, the Amendment Application could not provide Fiesta and Wolfedale with any remedy for their loss.

In other words, this is not a case where it was “legally appropriate … [to] delay in bringing a claim”, resulting in the relevant limitation period being tolled. See: Venture Construction Inc. at para 71 . Consequently, the Amendment Application cannot change the operative date. Fiesta and Wolfedale ought to have known that a legal proceeding would be appropriate to remedy their loss, namely, August 20, 2015, if not May 12, 2015. [ 94 ] Furthermore, the Act does not contemplate tolling a limitation period while an analogous interlocutory proceeding, such as the Amendment Application , remains in progress.

Given that Fiesta and Wolfedale knew, or ought to have known, that a proceeding would have been an appropriate means to remedy their loss and that Vomar appeared to be responsible for the act or omission claimed, the relevant limitation period began to run on August 20, 2015, at the very latest.

It expired on August 20, 2017, more than three months prior to the date that Fiesta and Wolfedale formally applied for leave to issue a third-party claim against Vomar. [ 95 ] The parties each cited the decision of the Ontario Court of Appeal in Lilydale Cooperative Limited v Meyn Canada Inc. , 2019 ONCA 761 , 439 DLR (4th) 385 [ Lilydale ] on this aspect of the application. Lilydale involved a jurisdictional dispute respecting whether the courts of Alberta or Ontario were the convenient forum for adjudicating the dispute.

Ultimately, the defendant’s application to stay the Ontario proceedings was denied, an appeal was subsequently dismissed, and the Alberta action was discontinued. See: Lilydale at para 9 . [ 96 ] The defendant then argued that, because the jurisdictional question remained unresolved until March 2008, it was not legally appropriate to issue a third-party claim in the Ontario proceedings until that time. See: Lilydale at paras 50 and 60-61 . [ 97 ] The Court of Appeal disagreed.

It held that “[a] forum challenge does not resolve the dispute between the parties but merely moves the dispute to a court in another jurisdiction. It is not an alternative process, but rather, it is the same process but in a different jurisdiction.”: Lilydale at para 61 . The purported “alternative process,” in other words, was not a “legally appropriate” reason for the appellant to delay in bringing its claim.

See: Lilydale at para 66 . [ 98 ] In coming to this conclusion, the Ontario Court of Appeal canvassed jurisprudence from that province respecting the “alternative process” argument and highlighted numerous cases where this argument proved insufficient to toll a limitation period. The Ontario Court of Appeal concluded in Lilydale as follows: [64] As in Ridel [ Ridel v Goldberg , 2019 OnCA 636 , 71 CBR (6th) 1 ] , Tapak v. Non-Marine Underwriters , Lloyd’s of London , 2018 ONCA 168 , 76 C.C.L.I. (5th) 197 , leave to appeal refused, [2018] S.C.C.A.

No. 157, and Gravelle [ Gravelle (CodePro Manufacturing) v Denis Grigoras Law Office , 2018 ONCA 396 ] , in this case, there was no alternative resolution process to which Weishaupt was a party that could have resolved the issue between it and Meyn.

Rather, Meyn was attempting to have the whole Ontario action dismissed, obviating the need for the third party claim. [65] To allow parties to wait, at their discretion, for other court or arbitral proceedings to conclude, where the result could obviate the need to bring a claim that they know exists, is inconsistent with the purpose of the Limitations Act [ Limitations Act, 2002 , SO 2002, c 24, Sched B ] for two reasons. First, this approach could extend the limitation period well beyond the two year original threshold in an uncertain and unpredictable manner.

Second, there were no significant savings to be achieved by not commencing the third party claim until the forum challenge was complete. Procedurally, a stand-still or tolling agreement could be sought until the forum issue had been finalized by the court so that the third party would not be required to plead in response.

However, it would be on notice that if the Ontario action proceeds, it is a named party, required to preserve its documents, and respond to the action as advised. [66] In my view, these factors drive the conclusion that the day Meyn was served with the statement of claim by Lilydale, it knew that a third party claim against Weishaupt was the appropriate means to seek a remedy from Weishaupt.

It was therefore not “legally appropriate” for Meyn to wait until the forum issue had been decided before the commencing third party claim. [Emphasis added] [ 99 ] It is noteworthy that the Lilydale court was careful to delineate which “alternative processes” may toll a

limitation period. It appears that to do so the alternative process must be one able to remedy the claimant’s injury, loss, or damage, and gives rise to a realistic possibility of successful resolution. See, also: Venture Construction Inc. at para 71 . [ 100 ] Applying these principles, I am persuaded that the plaintiffs’ Amendment Application is not an alternative proceeding which would toll the limitation period.

For one thing it is not an “alternative proceeding” as that concept is understood in the authorities because like the jurisdictional dispute at issue in Lilydale , the Amendment Application was an application in the same, and not an alternative, proceeding.

While the plaintiffs were entitled to attempt to add Vomar as a party defendant, this did not relieve Fiesta and Wolfedale from also attempting to commence a third-party claim against Vomar. [ 101 ] Second, the fact that Fiesta and Wolfedale adopted a “wait and see” stance while the Amendment Application was under reserve, was a deliberate and strategic choice on their part.

As the Ontario Court of Appeal in Markel Insurance Company stated at para. 34 : “To give ‘appropriate’ an evaluative gloss, allowing a party to delay the commencement of proceedings for some tactical or other reason beyond two years form the date the claim is fully ripened…would…inject an unacceptable element of uncertainty into the law of limitation of actions”. See, also: Lilydale at para 65 . [ 102 ] Vomar submitted that Fiesta and Wolfedale should have pursued a tolling agreement or otherwise issued a third- party claim to be adjourned sine die pending the resolution of the Amendment Application .

However, in response, Fiesta and Wolfedale stated that there was nothing to indicate that Vomar would be willing to enter into such an agreement. Respectfully, however, the onus is on Fiesta and Wolfedale to demonstrate they exercised due diligence and took steps to protect their interests. In my view, these were options available to them.

It is not for Vomar to prove, for example, that it would be open to agreeing to a tolling agreement. [ 103 ] Third, Fiesta and Wolfedale submit that it would not have been legally appropriate for them to commence a third- party claim while the plaintiffs’ application to add Vomar as a party defendant was under reserve. Had they done so, they contend, such an application would have altered the legal landscape and prejudiced an application already before the courts.

Fiesta and Wolfedale invoked Gurniak v Saskatchewan Government Insurance , 2016 SKQB 391 , 97 CPC (7th) 396 [ Gurniak ] to support this argument. [ 104 ] Respectfully, I do not find this argument compelling. The essence of the two applications was quite different. Whether the court ruled that Vomar was a co-defendant, would have no bearing on Fiesta and Wolfedale’s right to claim contribution and indemnity against it. Gurniak bears this out. There the court disallowed an application to file an amended statement of claim after an application to strike the claim had been heard and was on reserve.

That, plainly, is not this case. The two matters involve different parties and different considerations. [ 105 ] Accordingly, I conclude that the Amendment Application did not toll the limitation period for commencing a third-party claim against Vomar. Fiesta and Wolfedale should have commenced this application at the very latest by August 20, 2017, two years after learning that Vomar had requalified the propane tank which caused the fire on Mr. Bennett’s balcony.

As the notice of the third-party application was not issued until November 22, 2017, it is statute-barred. 3 Conclusion [ 106 ] To summarize: ss. 6(1) requires a court to ask when a claimant knew, or ought to have known, that (

a) it had sustained a loss, (

b) the loss appeared to be contributed to by

an act or omission, (

c) the act or omission appeared to be contributed to by another party, and (

d) a proceeding would be a legally appropriate means to remedy their loss. Where a claimant seeks to rely on a particular date when it gained knowledge of all the factors identified in ss. 6(1) , and thus “discovered” the claim, it must demonstrate it was not possible to learn of these factors any earlier. This assessment implicates a claimant’s obligation to exercise reasonable diligence compelling them to take all reasonable steps to protect its interests and preventing them from taking such steps for tactical reasons. [ 107 ] Applying these principles to this application, I conclude as follows: (

a) The principles of discoverability identified in ss. 6(1) of the Act , apply to third-party claims brought pursuant to s. 14 of the Act ; (

b) On August 20, 2015, if not before, Fiesta and Wolfedale satisfied all the factors identified in ss. 6(1) of the Act with the result that the two-year limitation on its third-party claim against Vomar commenced; (

c) The plaintiffs’ Amendment Application seeking to add Vomar as a party defendant was not an “alternative proceeding” providing a juridical reason for tolling the limitation period; (

d) The formal notice to bring a third-party application which Fiesta and Wolfedale served on Vomar on November 22, 2017 fell outside the two-year limitation period set out in s. 5 of the Act , and (

e) Fiesta and Wolfedale’s third-party claim is statute-barred, and must be summarily dismissed. [ 108 ] Respecting an order for costs, I acknowledge that the central legal issue presented on this application is novel and came before me as a matter of first impression. That said, Vomar has been successful in seeking to rebuff Fiesta and Wolfedale’s attempt to claim contribution and indemnity from it.

Accordingly, I direct that Vomar is entitled to its costs of this application which I set at $2,000 payable within 60 days from the date my order is issued. [ 109 ] Finally, I express my appreciation to counsel for their excellent written legal briefs and helpful oral submissions. J. G.G. MITCHELL