Number 461, April 2013
THE IMPACT OF THE NEW BC LIMITATION ACT ON LICENSEES
On June 1, 2013 the new BC Limitation Act1 (new Act) will come into force. The new Act replaces the former Limitation Act2, which came into effect in 1975.
What is the Limitation Act? The Limitation Act sets out how long a person has before he/she must start a civil court proceeding for a legal remedy. "Limitation period" means the period after which a court proceeding cannot be brought with respect to a claim. In other words, if a person fails to start a civil court proceeding against another party for a legal remedy within the specified limitation period, the action will be barred. The Limitation Act is a default regime, meaning that it applies in the absence of another enactment setting the applicable limitation period.
The old Act set out limitations of two, six, and ten years depending on the nature of the claim. The two year limitation period applied to actions involving claims related to injury to person or property and to certain tort actions such as defamation, false imprisonment, malicious prosecution, and trespass. The ten year limitation period applied to claims against personal representatives and trustees in relation to recovery of trust property. The six year limitation period was a catch all period for all remaining claims including breach of contract and negligence claims that did not result in injury to person or property. Under the old Act, the six year limitation period did not start to run until the individual became aware of the potential claim, or when a court considered that a "reasonable person" would have first become aware of the existence of a potential claim.
Under the new Act, rather than having a variety of basic limitation periods, there will be a single two year limitation period for most civil claims, with the exception of civil claims that enforce a monetary judgment, exempted claims and actions that have limitation periods set by other statutes.
Under the new Act, time will start to run for the basic limitation period when a claim has been "discovered". A claim is considered "discovered" on the first day on which the person knew, or reasonably ought to have known, all of the following:
|a) ||that injury, loss or damage had occurred; |
|b) ||that the injury, loss or damage was caused or contributed to by an act or omission; |
|c) ||that the act or omission was that of the person against whom the claim is or may be made; and |
|d) || that, having regard to the nature of the injury, loss or damage, a Court proceeding would be an appropriate means to remedy the injury, loss or damage.3 |
The new Act also sets out discovery rules for special situations involving minors, persons under a disability, and various other different types of claims.
In addition to the replacement of multiple limitation periods with a two year basic limitation period, the new Act will also replace the current ultimate limitation period of 30 years with an ultimate limitation period of 15 years. This means that even if the limitation period established under the Act in respect of a claim has not expired, a court proceeding cannot be commenced with respect to the claim more than 15 years after the day on which the act or omission on which the claim is based took place.
The new Act includes other reforms that will impact the practice of law. The important take-away for licensees, is that under the new Act, most claims brought against professionals, including licensees, will now have to be brought within two years of a claim being "discovered" as set out above and, in any event, no later than 15 years after the event giving rise to the claim.
| ||1. ||Bill 34 – 2012 Limitation Act. |
| ||2. ||Limitation Act, R.S.B.C. 1996, c. 266. |
| ||3. ||Bill 34 – 2012 Part 2, Section 8. |
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