IN THE PROVINCIAL COURT OF BRITISH COLUMBIA

[1]         Mr. Gregory McInroy brings an action against The Estate of Jon Gamble, Jon Burris and Mark Sedlickas for recovery of money he says he paid to Jon Gamble on December 23, 2005 and October 3, 2006 for an interest in a property in Tahsis, British Columbia (the “property”).  The total claimed is $9,464.00 plus filing and service fees.  His Notice of Claim was filed on May 4, 2021.

[2]         The defendants filed their Reply on May 11, 2021 alleging, among other things, that the claim is statute barred by virtue of the Limitation Act, S.B.C. 2012, c. 13, s. 8 (the Act).

[3]         A settlement conference was held on September 29, 2021 before Judge Gouge who ordered that a hearing be held to determine whether, as the defendants submit, Mr. McInroy’s claim should be dismissed for being beyond the time allowed by s. 8 of the Act.

[4]         The defendants reside in Washington, U.S.A. and applied for leave to appear at that hearing by MS Teams and advised that they did not intend to give evidence.  The application took place on November 19, 2021.  Leave was granted and the hearing, focused solely on the limitation defence, was scheduled to proceed on December 6, 2021.  In addition, the defendants were ordered to provide to Mr. McInroy any documents relating to the limitation defence.  Nothing was provided by the defendants.

[5]         The hearing commenced before me on December 6, 2021.  Mr. McInroy attended in person and gave evidence.  The defendants were represented by counsel and, as previously advised, gave no evidence.  At the outset of the hearing, the defendants asserted that Mr. McInroy’s claim must be dismissed as being past the time within which he could bring an action, pursuant to s. 8 of the Act.

[6]         The defendants assert that Mr. McInroy’s claim arose, at the latest, on October 3, 2006, when Mr. McInroy made his last payment to Mr. Gamble.  At best, the defendants say this was a demand loan for repayment and the time started running from the date the funds were advanced.  They also assert that, at the very latest, Mr. McInroy knew by 2012 or 2013 that he was not on title and could have taken legal action if he chose to do so.

[7]         Furthermore, the defendants say that even if I accept that Mr. Gamble continued to tell Mr. McInroy that he would “fix things”, there is no evidence that Mr. Gamble specifically told Mr. McInroy not to take court action.

[8]         The defendants referred to s. 24 (1) and (6) of the Act which allows the running of the limitation period to be extended if there has been an acknowledgment of liability and the acknowledgment was made in writing and signed.  They point out that nothing was provided by Mr. McInroy in writing that would operate as an admission that would extend the limitation period.

[9]         Essentially, the defendants say that Mr. McInroy should have known, much earlier than he did, that he could have taken legal action to enforce his claim or, alternatively, retain counsel to obtain advice.

[10]      Mr. McInroy asserts that he did do something when, during his last conversation with Mr. Gamble, he gave him an ultimatum to put his name on title or he would go to the police.  Mr. McInroy relies on s. 21 of the Act which provides that the ultimate limitation period is 15 years in certain circumstances.  Specifically, he relies on s. 21 (3) of the Act which can extend a limitation period if a defendant conceals certain facts that may allow a claimant to become aware there has been a loss caused by the defendant or if the defendant wilfully misleads a claimant about the appropriateness of a court proceeding as a remedy for that loss.  Mr. McInroy says that Mr. Gamble mislead him and he did not discover his loss until he found out in May 2021 that Mr. Gamble had been laughing about Mr. McInroy’s claim being barred by the Act.  He asserts that the limitation period therefore commenced in May 2021 and he is within the time required to commence legal action.

[11]      Commonly, these issues arise by way of application in a summary, or expedited, manner.  The issue in this case was raised in a Small Claims Court hearing requiring me to rule on the defendants’ application to dismiss the claim for being statutorily barred.  The defendants did not provide evidence.  Mr. McInroy represented himself.  This is not unusual in our court which is often the only way for people to resolve disputes in an inexpensive manner without the cost of retaining legal counsel.

[12]      Nonetheless, I must render a decision doing the best that I can after considering the law, the evidence and submissions of both parties.  After the hearing, I reserved my decision.

[13]      These are my reasons for judgment.  My decision is only in relation to the limitation issue and does not deal with the underlying cause of action alleged by Mr. McInroy.  Mr. McInroy did not have the benefit of counsel and there was very little precedent in British Columbia to guide me.  As will become apparent, this review took some time because it required a review of legal authorities in other jurisdictions as well as British Columbia.  I have outlined the results of my review to enable the parties to understand the rationale for my decision.  I reviewed all the legal authorities provided by the defendants and those have been considered by me in reaching my decision.

[14]      The issue is whether or not Mr. McInroy has commenced his action too late in accordance with the provisions of s. 8 of the Act.  To break it down, the issues are:

[15]      The only witness to give evidence was Mr. McInroy.  Mr. Gamble passed away in early 2021.  Therefore, a significant portion of the evidence from Mr. McInroy related to statements allegedly made to him by Mr. Jon Gamble and discussions between them.  The defendants did not raise any objections to this evidence.  Nevertheless, I am cognizant that hearsay evidence is presumptively inadmissible and, in the circumstances of this case, I must determine whether that evidence should be admitted, utilizing the criteria of necessity and reliability.

[16]      Necessity means that there is no other means of adducing the evidence and that criteria is certainly met here.  I must assess threshold reliability of the statements and their ultimate reliability in the context of all the evidence.  Hearsay statements may be admitted if, because of the way in which it came about, its contents are trustworthy, or if circumstances permit the ultimate trier of fact to sufficiently assess its worth:  R. v. Khelawon, 2006 SCC 57 at para. 2.

[17]      In this case, Mr. McInroy was subject to cross-examination by counsel for the defendants.  According to Mr. McInroy, both defendants, Mr. Mark Sedlickas and Mr. Jon Burris, who were present during this hearing, were friends of Mr. Gamble.  Mr. Sedlickas was involved in the original purchase of the property, Mr. Burris was placed on title at a later time, and both travelled regularly with Mr. Gamble to Vancouver Island to go fishing.  Mr. McInroy was hired as their guide.  I expect they would have been able to instruct their counsel appropriately.  Mr. Sedlickas and Mr. Burris could have given evidence but chose not to do so.

[18]      I am satisfied that the hearsay statements allegedly made by Mr. Gamble to Mr. McInroy are admissible and that I am able to assess the ultimate reliability and weight of that evidence.  This includes my assessment of the reliability and veracity of Mr. McInroy’s evidence.

[19]      Mr. McInroy has worked as a fishing guide since approximately 1993 - about twenty-eight or twenty-nine years.  His passion is fishing.  He originally lived in Port Alberni but had lived in Tahsis, British Columbia since June, 2006.  Tahsis is a small community near Gold River, British Columbia.  He regularly took his clients river fishing in the Tahsis and Gold River area.  He testified that  prior to meeting Mr. Gamble, Mr. Sedlickas, Todd Kramer, one of the original owners of the property, became his customer and Mr. McInroy took him river fishing in the Tahsis area.

[20]      In 1995, Mr. McInroy met Jon Gamble and Mark Sedlickas when they came up to Tahsis with Mr. Kramer to fish.  All three men were from the Seattle, Washington area.  Mr. Sedlickas owned an aircraft and Mr. Gamble and Mr. Kramer would fly to northern Vancouver Island with him.  Mr. Gamble owned a boat that he would leave in Tahsis and the three men would fish, with Mr. McInroy as their guide.  Mr. McInroy testified that the three men would come to Tahsis on weekends.  I accept that this was a regular, ongoing occurrence.

[21]      In the summer of 2005, the four of them started looking for a house in Tahsis where they would stay for their fishing trips.  Rental accommodation was expensive because of the demand for accommodation by people who were travelling to the area on fishing trips.

[22]      Mr. McInroy suggested they look at the property that is the subject of these proceedings. It was an old bunkhouse built possibly in the early 1970’s during the days when the mill was operating in Tahsis.  It originally had 48 rooms and 24 bathrooms but had been remodelled.

[23]      They looked at the building in August, 2005 and, according to Mr. McInroy, Mr. Gamble took the lead and contacted the owner – Western Forest Products.  Mr. McInroy testified that an offer was made by Mr. Gamble of $88,000 which was accepted.  Mr. McInroy thought the sale may have completed in the fall of 2005 but I do not believe he was sure about that.  I asked Mr. McInroy who was on title for the property when it was purchased.  His evidence is that Mr. Kramer told him that Mr. Gamble, Mr. Kramer and Mr. Sedlickas were on title at the time of the purchase and sale. 

[24]      Mr. McInroy testified that he spoke to Mr. Gamble over the Christmas holidays that year, 2005.  Mr. Gamble told him that they (Mr. Gamble, Mr. Kramer and Mr. Sedlickas) each contributed $30,000 to buy the property.  Mr. McInroy talked to Mr. Gamble about making his own contribution of $10,000, which, along with the additional $90,000 from the other three, would bring the total investment in the property to $100,000.  Mr. McInroy says that Mr. Gamble agreed with that proposition and accepted Mr. McInroy’s offer.  Mr. McInroy understood that his interest would represent 10% of the property.  Mr. McInroy didn’t have much money on hand and gave the funds to Mr. Gamble in two instalments.  Mr. McInroy obtained the first bank draft on December 23, 2005 in the amount of $5,000 and deposited it to Mr. Gamble’s bank account at that time.

[25]      He testified that he gave the December 23, 2005 bank draft to Mr. Gamble when they went to Tahsis to look at the property.  According to Mr. McInroy, the property needed quite a lot of work and appliances.

[26]      Mr. McInroy obtained another bank draft in the amount of $ 4,464 several months later and, on October 3, 2006, and deposited those funds into Mr. Gamble’s bank account.  To make up the rest of the money and to add up to $10,000, Mr. McInroy contributed a stove valued at just under $500.  The invoice for the stove was from a company in Port Alberni issued to Mr. McInroy and dated February 28, 2006.  According to Mr. McInroy, the three men, Gamble, Kramer and Sedlickas, travelled to Port Alberni in March, 2006 and he gave them the stove as well as a dishwasher, washer and dryer, which was “part of the deal (he) worked out with Mr. Gamble” because the house had no appliances.  Mr. McInroy’s copies of the original bank drafts and the invoice for the appliance were produced as evidence in this hearing.

[27]      Mr. McInroy moved to Tahsis in June, 2006.  He said that after the property was purchased it was “business as usual” and he lived in the property with the other three men.  He didn’t live there year round because he worked in Port Alberni during the winter and the building was left dormant.  The four men had their own bedrooms and other rooms were rental suites which, I understand, were used by McInroy’s other clients. Mr. McInroy charged those clients $100 per night for the accommodation and gave that money to Mr. Gamble, after deducting cleaning expenses.

[28]      Mr. McInroy thought that Mr. Kramer left this partnership about five years after the property was purchased.  That would be about 2010.

[29]      Mr. McInroy said that he spoke to Mr. Gamble about putting Mr. McInroy’s name on the title for the property “a handful of times over the years” and that Mr. Gamble always said he would do it.  Nothing was in writing.  At some point, Mr. Burris bought into the property.  I accept Mr. McInroy’s evidence that his discussions about the property were primarily, if not always, with Mr. Gamble.

[30]      Mr. McInroy moved out of the building at some point as a result of a disagreement with Mr. Gamble about the poor upkeep of the property and the need for insurance.

[31]      The last time Mr. McInroy saw Mr. Gamble was when he took him fishing in or about September, 2020.  He didn’t speak to him at that time about the title on the property because another person was present and he didn’t feel it was appropriate.  Mr. McInroy testified that the last time he spoke to Mr. Gamble about addressing the title issue and the money he had given to Mr. Gamble was November or early December 2020.  Mr. Gamble was at his own residence in Washington and Mr. McInroy spoke with him on the phone.

[32]      Mr. McInroy’s evidence is that during this call he told Mr. Gamble the next time Mr. Gamble came to Canada they would “settle this”.  Mr. McInroy was upset and threatened to report Mr. Gamble to the RCMP and have him charged with fraud.  As Mr. McInroy stated in his evidence - “he defrauded me of $10,000.”

[33]      His testified that every time he spoke with Mr. Gamble about putting his name on title, including this last time in late 2020, Mr. Gamble continued to tell Mr. McInroy, and promised, that he “would get it done”.  The last time they spoke about the issue in late 2020, Mr. McInroy’s evidence is that Mr. Gamble told him that Mr. McInroy would have to wait until Mr. Gamble was back in Canada and when he returned, he would pay him back or put him on title.  Mr. McInroy testified that he thought Mr. Gamble was attempting to have a realtor look at the property.

[34]      In March 2021, Mr. McInroy was advised by Mr. Burris that Mr. Gamble had passed away.  Mr. Gamble never did place Mr. McInroy’s name on title and did not address the issue of the money paid to Mr. Gamble.

[35]      In May, 2021, Mr. Burris and Mr. Hoff, the accountant and executor of Mr. Gamble’s estate, attended at Mr. McInroy’s residence in Port Alberni.  Mr. McInroy’s evidence is that he was told by them that his case was statute barred and that Mr. Burris and Mr. Gamble had previously laughed about it.

[36]      Two days later, on May 4, 2021, Mr. McInroy filed his Notice of Claim.

[37]      When asked why he didn’t commence his claim sooner, he replied “if you can’t trust your friends, who can you trust?”

[38]      In cross-examination he agreed that there was never anything in writing – no letters, text messages or emails.  He agreed that when Mr. Kramer left the partnership, it was brought to his attention that his own name was not on title.

[39]      When asked if he took any action to address this in 2012 or 2013, he responded that he spoke with Mr. Gamble and Mr. Gamble said he would “fix things”.  When asked if he took any legal action, his response was that he did when he “found out they were lying” but before then, Mr. Gamble continued to tell him he was going to “fix this”.  I understand that to mean that Mr. Gamble promised to put Mr. McInroy’s name on the title to the property.

[40]      I start by outlining the very basic premise underlying the law of limitations.  The purpose of legislation limiting the time within which parties may start legal proceedings is to provide security for individuals or potential defendants from stale actions brought years after the facts giving rise to the action are known or ought reasonably to have been known.  In addition to certainty, it ensures that when actions are brought, the evidence is relatively fresh and witness’ memories have not eroded through the effluxion of time.

[41]      The current Act was brought into force on June 1, 2013.  One of the purposes of this legislation was to bring it in line with modernized limitations statutes in Alberta, Saskatchewan, Ontario and New Brunswick.  The British Columbia Ministry of Justice referred to s. 8 specifically and stated that the newly worded provision “recognizes that courts will continue to have considerable discretion in interpreting the meaning of the discovery test, in order to come to a just result, and to achieve fairness for plaintiffs”: The New Limitation Act Explained (Civil Policy and Legislation Office: Ministry of Justice, June, 2013) at 26.

[42]      The Limitation Act, SBC 2012, c 13 is the governing legislation (the Act):

[43]      Therefore, ordinarily, and unless s. 21 (3) applies, a claim must be brought within two years of the date that the claim is “discovered”.

[44]      The interpretation of The Limitation of Actions Act, SNB 2009, c L-8.5, in New Brunswick and the concept of discoverability was the subject of recent jurisprudence from the Supreme Court of Canada in Grant Thornton LLP v. New Brunswick, 2021 SCC 31.  The provisions at issue in that legislation are virtually identical to s. 8 (a) to (c) of the Act.  In Grant Thornton, the Province was obligated to pay $50 million in loan guarantees it gave to a company which ultimately defaulted on its obligations to the bank.  When it provided the guarantee, the Province relied upon a report prepared by an auditor – Grant Thornton.  After the default, the province retained another accounting and auditing company who concluded that Grant Thornton had not identified the fact that the company’s financial statements had not been prepared according to generally accepted accounting principles and the company’s assets and net earnings had been significantly overstated (the “second report”).

[45]      The province commenced a legal action against Grant Thornton a little over four years after it paid out the guarantees, and a little over three years after it had received the draft of the second report.  Grant Thornton applied for summary dismissal of the claim on the basis that it was statute-barred by virtue of the limitation period under s. 5(1)(a) of The Limitations of Actions Act which provides that:

[46]      The court provided guidance on what is required to establish that a person “knew or reasonably ought to have known” the requirements set out in ss. 5(2)(a), (b) and (c) of that legislation (Grant Thornton, para. 34):

[47]      The motions judge concluded that the Plaintiff, the Province, “knew or ought to have known that it had prima facie grounds to infer that it had a potential cause of action against the defendants” on the date that it paid out the loan guarantees (Province of New Brunswick v. Grant Thornton LLP, et al, 2019 NBQB 36).  The action had been commenced almost four years after the date it paid out the guarantees and a little over three years after it received the draft second report and, accordingly, was statute-barred.  The province appealed.

[48]      The Court of Appeal (Province of New Brunswick v. Grant Thornton, 2020 NBCA 18) allowed the province’s appeal and overturned the motion judge’s ruling, applying a different and more stringent test.  The Court of Appeal concluded that a claimant must have knowledge that they actually have a claim, not a mere suspicion that would “accord the claimant a legal right to a judicial remedy for the defendant’s loss-causing act or omission.”  The appellate court held that the province could not have known that Grant Thornton’s actions fell below the requisite standard of care until the province had inspected Grant Thornton’s audit-related files, which Grant Thornton had refused to provide for a lengthy time.  Suspicion was not enough.  Grant Thornton appealed.

[49]      The Supreme Court of Canada, in a decision written by Justice Moldaver with all justices concurring, overturned the appellate court’s decision and restored the motion judge’s ruling (Grant Thornton LLP v. New Brunswick, 2021 SCC 31).  Comparing and contrasting the approach taken by the motion judge to the Court of Appeal, at para. 41, the Supreme Court of Canada concluded that neither approach was accurate:

[50]       The Supreme Court of Canada took the opportunity to thoroughly review the common law rule of “discoverability” and statutory limitation periods.  I do not need to set out those portions of the decision for the purpose of this decision.  However, in concluding that the statutory limitation period in the New Brunswick legislative framework did not oust the common law rule, the Supreme Court of Canada held that the limitation period was triggered when the province discovered, or ought to have discovered through the exercise of reasonable diligence, the material facts on which the claim is based (Grant Thornton, para. 40).

[51]      The court then went on to assess the particular degree of knowledge required to discover a claim under the legislation.  It applied an approach between that of the motions judge and the appellate court and, at para. 42, described the correct approach in this manner:

[52]      The material facts are those set out in s. 5(2)(a) to (c) of the Limitations of Actions Act: (a) that the injury, loss or damage has occurred; (b) that it was caused by or contributed to by an act or omission; and (c) the act or omission was that of the defendant.  These are cumulative and they all must apply.  At para’s 43 to 44 of Grant Thornton, the court explained that a plaintiff’s state of knowledge may be assessed by both direct and circumstantial evidence.  An example of constructive knowledge is when evidence establishes that the material facts could have been discovered by using reasonable diligence which may be triggered by suspicion.

[53]      Those known material facts must then give rise to a “plausible inference of liability” which is more than mere suspicion or speculation but not as much as a certainty of liability, perfect knowledge or perfect certainty:  Grant Thornton, para. 45 to 46.  Put another way, a “plausible inference is one which gives rise to a “permissible fact inference”: Grant Thornton, para. 45.

[54]      This approach, according to the court, provides the appropriate balance – it is not so low as to make it easy to defend an application to dismiss a claim (the motion judge’s approach), nor is it so high that the only way to obtain the requisite degree of knowledge is through discovery or experts (the Court of Appeal’s approach): para. 48.

[55]      The court determined that when the province received the draft report from another auditing firm (the second report), it knew, or ought to have known, the material facts upon which to draw a plausible inference that Grant Thornton had been negligent.

[56]      The common law rule of discoverability can be codified, limited or ousted by clear legislative language: Grant Thornton, para. 30.

[57]      The Act modifies the common law rule of discoverability by virtue of an additional provision that is not included in the New Brunswick Limitation of Actions Act.  The Act contains s. 8 (d) which adds the provision that:

[58]      The court in Grant Thornton was not required to address the interpretation of this statutory language.

[59]      There is a dearth of cases in which s. 8(d) of the Act has been considered by the courts in British Columbia.  In Aubichon v. Grafton, 2022 BCCA 77 the plaintiff commenced an action against an RCMP officer alleging that he had been assaulted in 2016.  The action was commenced a little over four years after the incident involving the parties.  The defendant brought an application to strike pleadings on the basis there was no prospect of success based upon the claim being brought past the limitation period.  The defendant argued that the plaintiff had the knowledge under s. 8 (a), (b) and (c) more than two years before he commenced the claim and therefore knew he had a claim “unless he did not have the practical ability to bring the claim   It was also asserted that the plaintiff had sought legal advice more than two years before the action and therefore knew, or ought to have known, that he “had a claim”.  The plaintiff asserted that he did not know a claim could be brought due to his experience of systemic racism as an indigenous youth and violence upon arrest. 

[60]      The chambers judge (Aubichon v. British Columbia (Attorney General), 2021 BCSC 1183) concluded that s. 8(d) was worded more broadly, declining to interpret it so narrowly as to apply only if a claimant does not have the “ability” to bring an action.  The chambers judge considered Mr. Aubichon’s subjective belief and experience as an indigenous youth in assessing whether it was appropriate for Mr. Aubichon to have brought an action at an earlier time:

[61]      The defendant’s appeal was unsuccessful.  One of the issues the appellate court considered was the interpretation of s. 8, particularly s. 8(d) of the Act.

[62]      Aubichon dealt with whether the claim was bound to fail and the provisions of Supreme Court Rule 9 as it relates to the limitation defence raised by the defendant and did not provide a detailed analysis of s. 8(d) of the Act.  The Court of Appeal was of the view that the issues raised in the case required the court to consider a new approach to the interpretation of the discoverability rule as it relates to a claimant who is unaware of the law, highlighting, at para. 53 that:

[63]      On the topic of the jurisprudence and judicial consideration of s. 8 of the Act, the court recognized that s. 8 has not been extensively considered or addressed by a court in British Columbia.  At para. 49 the court goes summarizes the task of a court asked to consider s. 8 of the Act: 

[64]      As a good starting point, Justice Marzari, in Borek v. Dr. Derek Stirling Hopkins, 2020 BCSC 304, nicely summarized the policy considerations underlying limitations legislation:

[65]      Marzari, J. concluded that Ms. Borek’s reliance upon Dr. Hopkins for ongoing treatment to fix and address her pain following placement of temporary crowns, coupled with Dr. Hopkins’ ongoing reassurances that her pain would be resolved, was not unreasonable.  On that basis, the court accepted that it would not have been appropriate, or practical, for Ms. Borek to have contemplated an earlier legal action:  paras. 51 & 52.

[66]      This approach required the court to make findings of fact about the claimant’s specific circumstances which provided the necessary context that allowed the court to assess when the claimant knew, or ought to have known, that a legal proceeding was appropriate.

[67]      A review of other decisions in this province indicates that other subjective factors may be relevant to that determination.  A claimant’s previous litigation experience with others, or the same parties, may result in a finding that it was reasonable for the claimant to have brought an earlier action:  Olenga v. Royal Columbian Hospital (R.C.H), 2017 BCSC 975, upheld on appeal 2018 BCCA 349.

[68]      The fact that the parties are involved in settlement negotiations will not suspend the running of the limitation period:  Arbutus Environmental Services Ltd. v. South Island Aggregates Ltd., 2017 BCSC 1.

[69]      Given the paucity of BC cases that analyse and apply s. 8 (d) of the Act, it is helpful to examine how courts in other provinces have interpreted the same, or similar, legislation. 

[70]      The wording of s. 8 (d) of the Act is identical to s. 6(1)(d) of The Limitations Act, SS 2004, c L-16.1 in Saskatchewan. Although not identically worded, s. 8(d) of the Act is strikingly similar to s. 3(1)(a)(iii) of the Limitations Act, RSA 2000, c L-12 in Alberta and uses the phrase “warrants bringing an action” instead of “a court proceeding would be an appropriate means  to …remedy the loss…”

[71]      In Ontario, the provisions of s. 5 (1)(a)(iv) of the Limitations Act, 2002, SO 2002, c. 24, Schedule B, s.5, is identical to s. 8(d) of the Act.  However, the Ontario legislation has added one additional provision:  s. 5(1)(b) that incorporates a subjective/objective analysis.  I will summarize some of the legal authorities from each of the regimes that have been helpful to my analysis in the case before me.

[72]      Saskatchewan’ legislation contains identical wording.  The Limitations Act, SS 2004, c L-16.1, provides that:

[73]      In Saskatchewan (Highways and Infrastructure) v. Venture Construction, 2020 SKCA 39, at para. 63, the Saskatchewan Court of Appeal recognized that a subjective element is an important aspect of this section, stating that s. 6(1)(d):

[74]      And, at para. 64:

[75]      In Alberta, the  Limitations Act, RSA 2000, c. L-12, s 3, has similar, but not identical, legislation which uses the word “warranted” instead of “appropriate”:

[76]      The Cambridge English Dictionary defines the words “warrants” and “appropriate” in this way:

[77]      The courts in Alberta have considered a number of factors in their consideration of s. 3 (1)(iii) - when an action, or proceeding, is “warranted”.  Although the wording of Alberta’s Limitations Act is not identical to that of British Columbia, the language is strikingly similar and I conclude the intent is the same. The jurisprudence from Alberta provides helpful guidance in my consideration of s. 8(d) of our Act.

[78]      In Mitchell v. Pytel, 2021 ABQB 403, the court provided a comprehensive review of the law regarding the interpretation of s. 3(1)(a)(iii), and at para. 283 employs a subjective analysis similar to that of Marzari, J. in Borek:

[79]      In Boyd v. Cook, 2013 ABCA 27, the court concluded that the limitation period had expired.  In reaching this conclusion, the court considered that the plaintiff was an “experienced sophisticated businessman with extensive knowledge and experience”: para. 6.

[80]      In Points West Living Red Deer Inc. v. Rockliff Pierzchajlo Kroman Architects Ltd., 2021 ABQB 589, an action was commenced almost three years after the claimant first discovered that there was a problem with the heating system.  Significant efforts had been made by the defendant to determine the cause of, and then correction of, the failure of the system to provide adequate heat in the winter.  The chambers master dismissed the defendant’s application for summary dismissal finding that the limitation period had not expired because in the circumstances, it would have been premature for the plaintiff to commence an action against the defendant.  The interpretation of s. 3(1)(a)(iii) was a central issue.

[81]      The Master, relying on other jurisprudence, applied a test that was both subjective and objective.  He also considered comments by the Law Reform Commission that the test of whether the injury warranted bringing a proceeding may include a cost-benefit analysis from the standpoint of the claimant.  The Master summarized a number of cases in which the defendant had been trying to fix the problems at issue before commencement of legal proceedings.  He referred to the judgment of Justice Clackson in Condominium Corporation 0812755 v. IBI Group Inc., 2019 ABQB 75 who, at para. 57 of that decision, approved of the approach by the Ontario Court of Appeal in Gillham v. Lake of Bays (Township), 2018 ONCA 667, para. 35, that the Ontario “legislature added the words “appropriate means” as an element of discoverability … to enable courts to function more efficiently by deterring needless litigation… [cites omitted].”

[82]      The Master concluded that the plaintiff’s reliance on the defendant’s attempts to identify the source of the problem and correct it, was reasonable in all of the circumstances.  Furthermore, at para. 42, after taking into consideration the need for an appropriate balance between “not allowing a cause of action to linger and not requiring lawsuits to be commenced prematurely”, he concluded that it would have been premature in those circumstances to bring a proceeding.

[83]      The Ontario Limitations Act, 2002, SO 2002, c. 24, Sch. B, contains the following provisions:

[84]      This legislation is similar to the Act but has an additional provision: s. 5 (b) which codifies a subjective/objective approach to the determination of when a claim is discovered.  Courts in Ontario have held that an assessment of s. 5, and specifically s. 5 (a)(iv) is very fact specific.  Keeping in mind this difference, the decisions considered in that province are still helpful, particularly if the proper assessment of s. 8(d) of the Act includes a subjective consideration of the claimant’s circumstances.

[85]      The Ontario Court of Appeal considered the correct approach to be taken by a court in determining the intent and meaning of s. 5(a)(iv) and s. 5(b) in 407 ETR Concession Company Limited v. Day, 2016 ONCA 709.  ETR is an organization with authority to collect tolls from people who use Highway 407.  The issue was when ETR “discovered” a claim against Mr. Day for debts he owed for numerous invoices issued to him by ETR.

[86]      The Ontario Court of Appeal determined that what is meant by “appropriate means” in s. 5(a)(iv) must be considered in the context of the purpose of s. 5(a)(1) of the legislation and also in the context of factors affecting ETR.  The court concluded that it was appropriate for ETR to attempt to recover payment for invoices by attempting other methods, including denial of driving licences, before commencing litigation.

[87]      Courts in Ontario have concluded that the discoverability date under s. 5(1)(a)(iv) is delayed when a plaintiff relied on the defendant’s knowledge and the defendant took steps to ameliorate the loss (Zeppa v. Woodbridge Heating & Air-Conditioning Ltd., 2019 ONCA 47) and when the parties have engaged in an alternate dispute resolution process that offers an adequate remedy (Sosnowski v. MacEwan Petroleum Inc., 2019 ONCA 1005; Dass v. Kay, 2021 ONCA 565).

[88]      The interpretation of s. 8(d) of the Act was not fully argued before the chambers judge in Aubichon (para. 52).  The decision of Marzari, J. in Borek was not before the chambers judge or the Court of Appeal in Aubichon.  Borek involved an application by way of summary trial to dismiss a claim and I do not know the extent of the evidence or submissions that were before the chambers judge.  The jurisprudence from other provinces is not binding upon me but it does provide guidance to assist me in interpreting and applying s. 8 (d) of the Act to the facts of the case before me.

[89]      Courts in Saskatchewan (Venture Construction), Alberta (Mitchell, Boyd, Points West Living) have concluded that similar or identical provisions to s. 8(d) of the Act are considered from the perspective of the claimant such as the claimant’s circumstances, the factual context of the claim and the nature of the relationship between the claimant and the defendant.  This is a subjective analysis.  This, in my view, is the approach incorporated by s. 5(1)(b) of the Ontario legislation. At least one court in British Columbia has reached the same conclusion (Borek).  The subjective analysis also has an objective component.  The claimant’s actions, or delay in action, must also have been reasonable in all the circumstances.

[90]      I also conclude that this was the intent of the legislature when it enacted the new Act which came into force in May, 2012.  The new Act was brought into force following a comprehensive review of the existing statute and consultations with many stakeholders.  It was intended to modernize and reform the statute and align it with developments in limitations law reform in other provinces including Ontario, Saskatchewan and Alberta: White Paper on Limitation Act Reform:  Finding the Balance, September, 2010.

[91]      A subjective analysis is necessarily contextual and may be based upon evidence about how experienced or sophisticated the claimant is in relation to the defendant (Boyd); a claimant’s previous litigation experience including with the same parties (Olenga); whether the parties may be able to resolve the case through an alternative dispute resolution process without the need for litigation (Venture Construction); where the costs or strain of litigation would overwhelm a claimant and where the prospects for recovery are minimal or speculative (Mitchell); where the defendant is attempting to identify and remediate the problem and the claimant reasonably relied on those attempts (Points West, Borek); or where the relationship between the claimant and the defendant is important to maintain from the claimant’s perspective (Borek).

[92]      I add that in those cases, the courts found that the actions of the claimant were reasonable in the circumstances.  This approach provides the framework to allow for a proper balancing between, on the one hand, not allowing claims to stagnate that ought to be commenced and, on the other hand, preventing unnecessary litigation when it would be premature to commence a proceeding.  It also balances the interests of claimants who may have very good reasons for not commencing a legal proceeding and the interests of defendants who may be facing proceedings involving events that occurred in the remote past.

[93]      I am persuaded that an assessment of s. 8(d) of the Act incorporates a subjective and objective element which requires an assessment of the claimant’s own circumstances as they relate to the factual matrix of the case and, whether in those circumstances, it would have been reasonable for a claimant to conclude it was appropriate to start a court proceeding.  This, in my view, is in keeping with the intention of the legislation.

[94]      S. 8(a) to (c) of the Act is virtually identical to the New Brunswick legislation.  The only difference is that s. 8(c) of the Act refers to knowledge that the act or omission was “that of the person against whom the claim is or may be made” whereas the New Brunswick legislation refers to knowledge “that the act or omission was that of the defendant.”  I discern no difference in those sections of the legislation.  Accordingly, the decision and reasoning by the Supreme Court of Canada in Grant Thornton is applicable to s. 8(a) to (c) of the Act and directly to my analysis in the case before me.

[95]      The first question I address is when Mr. McInroy had the requisite degree of knowledge such that he could have, or ought to have, drawn a plausible inference of liability of the part of Mr. Gamble.  That is in relation to ss. 8(a) to (c) of the Act.

[96]      The only evidence in this hearing was from Mr. McInroy.  He was not undermined in cross-examination and he was not contradicted by any other evidence.  I found Mr. McInroy to be straightforward and he did not embellish his evidence.  He was not evasive under cross-examination, and answered forthrightly.  I am mindful that forthrightness, lack of embellishment and demeanour is not a reliable way to assess a witness’ evidence and it is only one factor that may be considered in the context of my assessment of all the evidence:  Faryna v. Chorny, 1951 CanLII 252 (BC CA).  In assessing evidence, I must consider both credibility and reliability.  Credibility relates to honesty.  Reliability relates to the ability of a witness to observe and remember the events.

[97]      Although Mr. McInroy could not always recall the exact date, he testified that Mr. Gamble consistently promised to add Mr. McInroy’s name on title to the property, that he would fix things and in the last conversation in the fall, 2021, that he would settle things when Mr. Gamble returned to Canada.  Mr. McInroy did not bolster his evidence by suggesting a greater frequency of discussions about the issue of title on the property or the nature of the alleged promises.  Mr. McInroy’s evidence was not undermined or shaken under cross-examination.  He had a good recollection of the primary aspects of his evidence about his relationship with Mr. Gamble, Mr. Kramer, Mr. Burris and Mr. Sedlickas, his evidence about what Mr. Gamble promised and the reason for his payments of cash to Mr. Gamble.  He was not contradicted by any other evidence.  I find Mr. McInroy to be both reliable and credible and I accept his evidence.

[98]      It is clear that Mr. McInroy knew throughout that his name was not on title to the property.  He knew that he had paid about $10,000 to Mr. Gamble which I accept was a significant sum of money for him.  In about 2012, he was aware that Mr. Kramer left the partnership and there had been some falling out between Mr. Kramer and Mr. Gamble.  He testified that Mr. Kramer reminded Mr. McInroy that he was still not on title.  He also testified that Mr. Kramer told him not to trust Mr. Gamble.  After this, Mr. McInroy spoke to Mr. Gamble again and who again told him that it would be fixed.

[99]      In 2013, Mr. McInroy moved out of the property because, according to him, Mr. Gamble refused to place insurance on it.  His evidence is that he did not find out that he was not going to be paid for his contribution until Mr. Burris and the executor of Mr. Gamble’s estate visited him to Port Alberni in 2021, shortly after Mr. Gamble’s death.  Mr. McInroy testified that it was during this meeting that that Mr. Burris told him he had been laughed at behind his back about his claim being statute barred.

[100]   It is trite law that a claimant must use reasonable diligence to acquire knowledge, actual or constructive, of the material facts and, flowing from that, to determine if a plausible inference can be made that the loss was caused by a defendant:  Grant Thornton, para. 40 and 42.  A claimant cannot “sleep on their rights”:  Borek, at para.14.

[101]   The material facts here are that Mr. McInroy paid approximately $10,000 to Mr. Gamble in two instalments in 2005 and 2006; this was paid to Mr. Gamble in exchange for, and in reliance upon, Mr. Gamble’s promise to place Mr. McInroy on title for the property; Mr. Gamble did not do so.  Could Mr. McInroy have discovered that he had suffered a loss of the approximately $10,000 and that Mr. Gamble’s omission, or failure to place him on title was the cause of the loss?  Mr. McInroy asserts that he didn’t know that he had “lost” the money until he was told in May 2021 that Mr. Gamble had been laughing about Mr. McInroy’s claim being statute barred.  Mr. McInroy also testified that in late fall of 2021, he finally told Mr. Gamble that he would take steps to have him charged with fraud if he did not follow through with his promise to place him on title.

[102]   I conclude that Mr. McInroy, with the exercise of reasonable diligence, based on his knowledge that he had paid money to Mr. Gamble but had not been placed on the title to the property, contrary to Mr. McInroy’s understanding of their agreement.  He could have reached a plausible inference that Mr. Gamble was not intending, and did not intend, to carry out his promise to place Mr. McInroy on title by the time Mr. McInroy left Tahsis in 2013 because of a disagreement with Mr. Gamble.  At a minimum, he reasonably ought to have suspected that Mr. Gamble was not being truthful about his promises, particularly in the context of Mr. McInroy’s evidence that Mr. Kramer told him not to trust Mr. Gamble when Mr. Kramer left the partnership.

[103]   I conclude that the defendant has established that Mr. McInroy reasonably ought to have known that loss had occurred, that the loss was caused or contributed to by an omission and the omission was that of Mr. Gamble.

[104]   However, that does not end my inquiry.  The requirements of s. 8 are cumulative – they all must be present.

[105]   The key question to be addressed, on the facts of this case and based upon my conclusion, is whether Mr. McInroy also knew, or ought reasonably to have known, that, having regard to the nature of the loss, a court proceeding would be an appropriate means to seek to remedy the loss.

[106]   I approach the question in this manner.  After taking into consideration the nature of the loss, Mr. McInroy’s particular circumstances, the relationship between the parties, in particular, with Mr. Gamble, and the surrounding circumstances, I must determine when Mr. McInroy knew or ought reasonably to have known, that a court proceeding was an appropriate means to seek to remedy his loss.

[107]   The loss in this case is the loss of an interest in the property which he asserts was promised or, alternatively, the loss of approximately $10,000 which was paid to Mr. Gamble in two instalments in 2005 and 2006.

[108]   Since 1995, Mr. Gamble was regularly employed Mr. McInroy, along with his friends Mr. Sedlickas and Mr. Kramer, as a fishing guide in the Tahsis area.  Later, Mr. Kramer left the group and Mr. Burris joined.  Even as late as the summer of 2020, I accept Mr. McInroy’s evidence that he worked again for Mr. Gamble and was fishing with him in September, 2020 and that Mr. Gamble had spent a good part of the summer in Tahsis.

[109]   Mr. McInroy regarded Mr. Gamble as his customer, his business partner and his friend.  He believed and relied on Mr. Gamble’s assurances that Mr. Gamble would “fix things” and “make things right” by putting Mr. McInroy on title for the property.  Mr. McInroy says that he didn’t take Mr. Gamble to court earlier because Mr. Gamble continued to reassure him, and promised him, that he “would make it right”.  As Mr. McInroy said in his evidence:  “We went into this as friends and I wanted to keep this as friends.”  That was the reason he did not contact a lawyer.  That was the reason he did not start a legal action.  He also trusted and relied on Mr. Gamble’s promises.

[110]   It was not until November or December, 2020, during a conversation with Mr. Gamble, that Mr. McInroy told him that if the issue about title on the property and his $10,000 payment to Mr. Gamble was not addressed, he would take action.  Mr. Gamble’s promised that when he was back in Canada, he would put Mr. McInroy on title or pay him back the money Mr. McInroy had previously paid to him.  That never occurred because Mr. Gamble passed away approximately four or five months later, in May 2021.

[111]   Mr. McInroy is an unsophisticated person who has worked as a fishing guide all his life.  I do not have much evidence about Mr. Gamble or his friends, except that they were able to regularly travel in an aircraft, owned by Mr. Sedlickas, to an airport in central Vancouver Island where they would drive to the Tahsis area using Mr. Gamble’s boat which was left in the area for their use each summer. Mr. Kramer, and then later, Mr. Burris, often accompanied them.  I conclude that Mr. Gamble and his friends were most likely more sophisticated than Mr. McInroy who regarded them not only as customers, but also friends.

[112]   The reality of the relationship is that Mr. Gamble hired Mr. McInroy as a fishing guide.  This was a long-standing relationship of approximately twenty-six years.  Over that time, Mr. Gamble continued to hire Mr. McInroy as a fishing guide on a regular, yearly basis.  They continued this relationship right up to their last phone conversation during which Mr. McInroy told Mr. Gamble that he was going to report him to the police.

[113]   Mr. McInroy earns his income from his fishing guiding business, which included working as a fishing guide for Mr. Gamble and his friends, Mr. Kramer, Mr. Burris and Mr. Sedlickas.  Mr. McInroy struck me as a straightforward, trusting individual for whom a promise between a friends and customers would be honoured.  Another person may not have been so trusting, but I must consider Mr. McInroy’s circumstances and state of mind.  Although I did not hear specific evidence about the financial remuneration for his guiding services, I did hear evidence that he was not well off financially and that paying Mr. Gamble $10,000 in one lump sum would have been onerous.  I infer that Mr. McInroy was paid for his services as an angling guide and depended, at least in part, on that income.  His reliance on Mr. Gamble’s assurances, and his trust over the years, was, I find, as a result of their guide-customer relationship and Mr. McInroy’s belief that they were friends.  He wanted to maintain that friendship and relationship which, it is important to mention, had lasted twenty six years.

[114]   I conclude that Mr. McInroy did not believe that a court proceeding was an appropriate means to remedy the situation because of that reliance, the longstanding relationship and Mr. Gamble’s continued assurances and promise that he would place him on title.

[115]   I must not only consider Mr. McInroy’s subjective belief and his particular circumstances, but whether that belief was reasonable.  I frame it this way:  ought Mr. McInroy to reasonably have known that a court proceeding would be an appropriate means to remedy his loss?  This requires that I consider what a reasonable person, in Mr. McInroy’s circumstances, would do.

[116]   This is not a situation akin to a negotiation, nor a pending alternative dispute mechanism.  This is case of a claimant relying on the promises of a defendant, in the context of a long standing relationship that was, at its core, an employer/employee relationship.  I also accept that Mr. McInroy felt and believed they were friends as well.

[117]   I have given this case a great deal of thought.  Mr. Gamble continued to employ Mr. McInroy as his fishing guide throughout the entire period of time – since 1995 until a few months before his death in May, 2021.  Had Mr. McInroy commenced a legal proceeding, there is little doubt that the relationship, and Mr. McInroy’s employment, would have ended.  In the context of a long standing relationship, Mr. McInroy continued to believe and rely upon Mr. Gamble’s assurances that he would follow through with the original promise to place him on the title of the property.  I am concerned, of course, that this action was not commenced until 2021, approximately fifteen years after the last payment to Mr. Gamble.  Nonetheless, based upon the unique circumstances and facts of this case, I conclude that it was not until his last conversation with Mr. Gamble in November or December, 2020, that Mr. McInroy knew, or reasonably ought to have known, that a court proceeding would be an appropriate means to seek to remedy the loss.  That is when the claim was discovered and all the provisions of s. 8 of the Act crystallized and the limitations clock began to run.

[118]   I wish to address a few other issues.  I conclude that, based on Mr. McInroy’s evidence which I accept, Mr. Gamble’s promises are admissions that, had they been in writing, would have delayed the running of the limitation period pursuant to s. 24 of the Act.  I also considered that they may well have amounted to a promissory estoppel such that the defendants are prevented from relying on a limitation defence.  Such statements and admissions can also allow a court to infer that a promise was made to not rely on a limitation period (Tolentino v. Gill, 2012 BCSC 1383, para. 9).  In additional to a promissory estoppel, that could also bring s. 21 (3)(b)  of the Act into play.  However, because this issue was not raised, I have not addressed this in any more detail.

[119]   I also considered whether Mr. Gamble’s continued promises to “fix things” and “make things right” amounted to a new contract each time the promise was made.  A valid contract requires an offer, acceptance and consideration.  The promise by Mr. Gamble is an offer which clearly was accepted by Mr. McInroy.  Forbearance is a promise, express or implied, to refrain from something such as commencing legal action.  It can constitute valid consideration:  Royal Bank v. Kiska 1967 CanLII 154 (ON CA), [1967] 2 O.R. 379-393 (ON CA).  Forbearance can be implied from the surrounding circumstances:  Stott v. Merit Investment Corp., 1988 CanLII 192 (ON CA), [1988] 48 DLR (4^th) 288 (ON CA).  Forbearance can reasonably be implied or inferred from Mr. McInroy’s conduct in not bringing a court proceeding upon accepting Mr. Gamble’s offer and promise to “fix things”.  This would delay the limitation clock running until the last conversation with Mr. Gamble in November or December, 2020 in which Mr. McInroy did not agree to forbear from bring a legal action, when he told Mr. Gamble he would take steps if the matter was not dealt with.

[120]   Finally, subject to my comments in paragraph 117, I do not agree with Mr. McInroy’s submission that s. 21 (3)(a) of the Act applied to extend the limitation period.  There was no evidence that Mr. Gamble wilfully mislead Mr. McInroy about whether a legal proceeding was appropriate.  In my view, that would have required some evidence that Mr. Gamble and Mr. McInroy discussed the possibility of legal action and Mr. Gamble dissuaded him.  There is no evidence that Mr. Gamble concealed a loss from Mr. McInroy – instead, the evidence I accept is that he promised to put Mr. McInroy on title, or, in Mr. McInroy’s words, that he would “fix” things.  That is not akin to concealment.

[121]   I also, with respect, disagree with the defendants’ submission that the money paid by Mr. McInroy was a demand loan and the limitation period started running on the date the payment, or loans, were made.  There is no evidence that this was a demand loan.  The decision in Nguyen v. Canam Active Enterprises Inc., 2021 BCSC 1454 was not particularly helpful.  There, the plaintiff did not provide any evidence and, in all circumstances, the court was not required to consider the application of s. 8(d).

[122]   I have concluded that Mr. McInroy did not know, or reasonably ought to have known, until November or December 2020, that, having regard to the nature of his loss or damage, a court proceeding would be an appropriate means to seek to remedy his loss or damage.  The exact date does not affect my decision.  It was not until that time that the limitation period began to run.  Mr. McInroy’s Notice of Claim was filed on May 4, 2021, well within two years of that time.

[123]   Accordingly, Mr. McInroy’s claim is not statute-barred.

[124]   This matter should be scheduled for a further Settlement Case Conference.  I am not seized with this matter.