A clarification on the ultimate limitation period and the York Condominium Corp. and Jay-M Holding case
The How Long Should You Keep Your Close Files? article in the December 2010 issue of LAWPRO Magazine was well received by Ontario lawyers. From the emails, phone calls and personal comments we received, it is clear the information we provided was helpful to many lawyers in terms of the decisions they needed to make with respect to the retention and destruction of closed files.
We also received some questions with respect to the side note to the above article concerning the ultimate limitation period and the Court of Appeal decision in the York Condominium and Jay-M Holding case. To make the comments in that side note clearer, we have added three words to the opening sentence in the final paragraph. The full text of that side note with the additional words highlighted in bold appears here:
When the Limitations Act, 2002 was proclaimed in force on January 1, 2004, many lawyers hoped that s. 15 of the Act would provide immediate protection against claims arising from legal services performed more than 15 years before the claim was made.
Section 15(2) of the Act provides that “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…”
The judgment of the Court of Appeal in York Condominium Corp. No. 382 v. Jay-M Holdings, 2007 ONCA 49 (also found at 84 O.R. (3d) 414) put an end to this hope.
The Court held that where the allegedly defective services were rendered in 1978, by virtue of s. 24 of the Act (the “transition provision”), the defective services were deemed to have been rendered on January 1, 2004. Therefore, the 15-year “ultimate limitation period” was inapplicable.
By reason of this judgment, it appears that undiscovered claims based on legal services rendered on or before January 1, 2004, will be barred by s. 15 only as of January 2, 2019. As we move through 2019, legal services provided throughout 2004 will begin to be shielded from claims by s. 15. Claims for services rendered throughout 2005 will come under s. 15’s purview through 2020, and so on into the future. In the meantime, s. 15 appears to be of little practical importance.