Defendants Escape Liability

Several doctrines and statutory provisions prevent a Court from addressing otherwise good claims. Thus, it is important to be aware of what these rules are, to ensure one is not prevented from receiving a remedy from the Court.

One such statutory provision to be aware of is the Limitations Act. Under the Limitations Act, a defendant may be barred from being held liable for a claim. Section 3(1)(a) provides that if a person does not bring an action through the commencement of legal proceedings within 2 years after the date the person learned of a claim, the defendant is entitled to immunity. Therefore, if two years have passed since a person became aware they had a claim, then they will be without a remedy.

Another doctrine to be aware of is issue estoppel. Issue estoppel prevents a party from re-commencing legal proceedings in respect of an issue that has already been litigated in judicial proceedings.

A similar doctrine is cause of action estoppel. Cause of action estoppel prevents a party from litigating a cause of action where the basis for the cause of action was litigated, or could have been litigated in prior judicial proceedings.

The recent case, Klein (Re) provides an example of how the Courts may interpret these rules and principles. Three siblings Ann, Raymond and Marilynn were before the Court regarding issues relating to the administration and distribution of their deceased mother’s Estate. Several judicial proceedings had been heard between the parties in dispute before the March Court date. The parties requested the Honourable Mr. Justice R. A. Graesser make an Order on several issues that remained in dispute.

However, Justice Graesser did not issue an Order on all the claims, because some claims were:

1. Barred by the Limitations Act;
2. Should have been brought in prior judicial proceedings that had taken place between the parties; and/or
3. A previous judge had already issued an Order in relation to the claim

Ann’s claim that Raymond had taken money from their mother’s Estate, and her claim requesting possession of personal property owned by their mother were barred by the Limitations Act. More than two years had passed since she knew of these claims, and the Court did not issue an Order.

Raymond and Marilynn had several claims that Justice Graesser did not issue an Order for. Their request for reimbursement of expenses from the Estate had expired. Their claim that Ann took money from accounts improperly, and that she failed to properly accounts for expenses was barred. Justice Graerer stated they should have litigated these matters when the Court addressed issues relating to accounting.

Further, Raymond and Marilynn’s request that Ann incur $100,000 of her legal expenses personally, because that amount was depleted from the Estate due to her refusal to cooperate and her misconduct, was barred as well. The Court had previously issued an Order that all parties’ legal fees would be paid by the Estate, and the appropriate action would have been to bring an application to appeal the decision.

This case demonstrates the importance of bringing an application quickly once one becomes aware of a claim against another party, the importance of litigating all relating issues within one application, and the importance of following proper procedure and appealing an Order on an issue rather than commencing a new claim.

NOTE: The Court in Klein does not go over the principles of the issue estoppel or cause of action estoppel. He does not cite the legal doctrines that form the basis of why the claims cannot be brought.

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Case Summaries