Limitation periods in Ontario end more good claims than bad defences ever do. A person with a strong case, clear documents and an obviously liable opponent can lose entirely by waiting, because the right to sue expires on a schedule that takes no interest in the merits. The general rule is two years, which sounds simple until you ask the question that actually decides most cases: two years from when? That question, and the handful of exceptions around it, is what this comes down to.
The Basic Two-Year Rule
The governing statute is the Limitations Act, 2002. Section 4 states the rule plainly: unless the Act provides otherwise, a proceeding shall not be commenced in respect of a claim after the second anniversary of the day on which the claim was discovered.
Two points follow. The clock runs from discovery, not from the wrong itself, and the deadline is about commencing the proceeding, not resolving it. Issuing a claim within the period preserves your rights; negotiating, complaining, waiting on an insurer or hoping for a payment does not.
Miss the deadline and the claim is statute-barred. The court does not weigh how compelling your case was.
What Discovery Actually Means
Section 5(1) defines when a claim is discovered. It is the earlier of two dates. The first is the day the person with the claim first knew that the injury, loss or damage had occurred; that it was caused by or contributed to by an act or omission; that the act or omission was that of the person against whom the claim is made; and that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it. The second is the day a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known those things.
All four elements of the first branch must be present. Knowing you have suffered a loss is not enough if you could not reasonably have known who caused it. This is why claims involving latent defects, professional negligence and fraud sometimes proceed years after the underlying events.
Then comes the provision that traps people. Section 5(2) presumes that the person with the claim knew of those matters on the day the act or omission took place, unless the contrary is proved. The burden is on you to displace that presumption. Anyone planning to argue late discovery should assume they will have to prove it with evidence, not assert it.
The Outside Limit and the Exceptions
Discoverability does not extend indefinitely. Section 15(2) imposes an ultimate limitation period: no proceeding shall be commenced after the fifteenth anniversary of the day on which the act or omission took place, regardless of when the claim was discovered. Section 15(4) provides that the ultimate period does not run during certain periods, including while the person with the claim is a minor or incapable.
Section 16 sets out claims to which no limitation period applies at all. They include a proceeding for a declaration where no consequential relief is sought, a proceeding to enforce a court order or an order enforceable in the same way, and a proceeding to obtain support under the Family Law Act or to enforce a support provision in a contract that could be filed under section 35 of that Act.
Other provisions shift the analysis in ways that matter commercially. Section 5(3) addresses when loss occurs in relation to a demand obligation, which affects loans repayable on demand. Different limitation periods apply under other statutes for particular kinds of claims, so the two-year rule should be treated as the default rather than the universal answer.
What to Do About Limitation Periods in Ontario
Treat the date of the event as your deadline, not the date you think you discovered the problem. If you are right about discovery you lose nothing by acting early; if you are wrong, acting early is the only thing that saves the claim.
Get advice as soon as you suspect you have a claim, particularly where you do not yet know who is responsible or how much you have lost. Neither uncertainty is a reason to wait, and both are reasons to have someone assess the limitation position now.
Do not let negotiation run the clock out. This is the most common way claims are lost: months of constructive discussions, an insurer who seems cooperative, an expected payment that never arrives, and a deadline that passed while everyone was being reasonable. Where more time is genuinely needed, parties can agree in writing to suspend or extend a limitation period in the circumstances the Act permits, but that requires a deliberate agreement, not goodwill.
Keep a record of when you learned what. If discovery is contested, contemporaneous evidence of what you knew and when is what displaces the section 5(2) presumption.
Limitation periods matter just as much when you are the one being sued. If you have been served with a claim, it is worth checking whether it was started in time, but that question should never delay your response: in the Superior Court, a statement of defence is generally due within 20 days of being served in Ontario. Our guide on being served with a statement of claim explains the deadlines and your first steps.
If you think you may have a claim, or you have been threatened with one, George Habib, civil litigation lawyer at Habib Legal Counsel, will assess where you stand and how much time you have. Visit HabibLC.com or call anytime at 647-648-2164 — George Habib and his firm are ready to help.
George Habib | Habib Legal Counsel | Civil Litigation | 647-648-2164 | Contact us
