Limitation Periods in Maritime Law
Commentaries are intended as an introduction or overview of the topic. The commentaries for some topics are more detailed than others but none of them should be taken as a complete and full recitation of the law applicable to the topic.
The limitation periods that apply to claims governed by maritime law are not always easy to identify or locate. The federally prescribed limitation periods for many of the more common claims subject to maritime law are addressed below. For those claims for which there is not a specific limitation period, s. 140 of the Marine Liability Act now provides for a general limitation period of three years.
Personal Injury from Collision between
MLA s. 23(1)
Personal Injury to a “passenger”
Athens Convention, art. 16 r. 1
Other Personal Injury
MLA s. 140
MLA, s. 14
Property Damage from Collision between
MLA s. 23(1)
Damage to Cargo Governed by Hague Visby
Hague-Visby Rules, art. 3. r.6
Other Property/Cargo Damage
MLA s. 140
Pollution Claim Against Owner of a Ship
MLA, Sched. 5,
3 years (but can be as much as 6 years)
Pollution Claim Against Administrator of
MLA, s. 103
2 years (but can be as much as 5 years)
All Other Claims under Canadian Maritime
MLA, s. 140
Application of Provincial Limitation Statutes
It is now reasonably clear that the limitation periods under provincial limitation statutes will not apply to matters governed by Canadian maritime law as there is now a general limitation period in s. 140 of the Marine Liability Act applying a three year limitation period to all matters governed by Canadian maritime law for which there is not a specific federally prescribed period. This three year general limitation period was contained in Bill C-7 and enacted on 23 June 2009. Cases decided prior to the enactment of Bill C-7 and which applied provincial limitation statutes should be treated with care. Cases which have refused to apply provincial limitation statutes include: Nicholson v. Canada,  3 FC 225; Russell et al. v. MacKay, 2007 NBCA 55; Frugoli v. Services Aériens des cantons de L'Est inc., 2009 QCCA 1246 ; G.B. v. L. Bo, 2014 QCCS 18; and Malcolm v. Shubenacadie Tidal Bore Rafting Park Limited, 2014 NSSC 217. These cases also stand for the proposition that those parts of provinicial limitation statutes that operate to extend limitation periods will not apply where the matter is governed by Canadian maritime law. A case to the contrary is Gaudet v. Navigation Madelaine Inc., 2014 QCCS 4106 but it is not very convincing as it is against the weight of authority.
Federally Prescribed Limitation Periods
Personal Injury - Death
If personal injury results from a collision between two ships the limitation period is two years as set out in s. 23(1) of the Marine Liability Act.
If personal injury is caused to a passenger the limitation period is two years as set out in Art.16, r.1 of the Athens Convention.
If the claim is for personal injury not caused in a collision between two ships and not to a passenger, the limitation period is three years as set out in s. 140 of the Marine Liability Act.
If property damage results from a collision between two ships, the limitation period is two years as set out s.23(1) of the MLA.
If the property damage is to cargo that is carried under a contract of carriage subject to the Hague-Visby Rules, the limitation period is one year as set out in Art. III, r. 6 of the Hague-Visby Rules.
If the claim is for property damage not caused in a collision between two ships and not to cargo covered by the Hague-Visby Rules, the limitation period is three years as set out in s. 140 of the MLA.
Claims by Dependants
Claims by dependants of an injured or deceased person must be commenced within two years pursuant to s.14(1)and (2) of the Marine Liability Act.
Pursuant to Art. VIII of Sched. 5 of the Marine Liability Act, a claim against the owner of a ship for damages caused by pollution must be commenced before the earlier of (i) three years after the day on which the pollution damage occurred, and (ii) six years after the occurrence that caused the pollution damage. If the pollution damage was caused by more than one occurrence having the same origin, the claim must be commenced within six years after the first of the occurrences.
Pursuant to s. 103 of the Marine Liability Act, a claim against the Administrator of the Ship Source Oil Pollution Fund must be commenced a) within two years after the day on which oil pollution damage occurred and five years after the occurrence that caused that damage, or (b) if no oil pollution damage occurred, within five years after the occurrence in respect of which oil pollution damage was anticipated.
Contribution - Indemnity
Pursuant to s. 20 of the Marine Liability Act, actions against third parties for contribution or indemnity must be commenced within one year of the date of the judgement or settlement giving rise to the claim.
All other matters governed by Canadian maritime law
Pursuant to s. 140 of the Marine Liability Act, all other claims governed by Canadian maritime law must be commenced within three years after the date the cause of action arose.
The database contains 26 case summaries relating to Limitation Periods in Maritime Law. The summaries are sorted in reverse date order with 20 summaries per page. If there are more than 20 summaries, use the navigation links at the bottom of the page.
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Maritime - Navigation - Shipping - Interjurisdictional immunity - Federal
Desgagnés Transport Inc. v. Wärtsilä Canada Inc., 2019 SCC 58
Précis: The Supreme Court of Canada held that provincial law, and not Canadian maritime law, applied to a contract of marine engine parts so that the supplier of the parts was liable for the full quantum of damage.
Summary not yet available.
Maritime liability - Rafting - S. 140 MLA - Adventure Tourism
Jean Riley v. New Wave Expeditions Inc., 2019 QCCS 3697
Précis: The Quebec Superior Court could not strike a claim arising from a river rafting excursion where the underlying facts, which determined the applicable limitation period, were disputed.
Facts: This was a motion by the defendant to strike the plaintiff's claim. The plaintiff was injured during a rafting trip on 11 June 2015 and claimed damages from the defendant organizer of the trip for same by commencing an action on 8 June 2018. The defendant argued that the claim was time barred by s. 23 of the Marine Liability Act which provisioned a two year limitation period beginning on when the injury arose. The plaintiff argued that s. 23 does not apply as this claim was one of adventure tourism as prescribed by s. 37.1 of the MLA and therefore the three year time limitation period under s. 140 governed the claim.
Decision: Defendant's motion dismissed.
Held: To strike a claim under Quebec's Civil Code, the law can be disputed but the underlying facts of the claim cannot. The Quebec Superior Court examined the wording of s.23 of the MLA and found that section pertained to "vessels in a collision situation". The Court noted however that the plaintiff disputed that this was a "vessel collision" situation, which meant there was as dispute as to the underlying facts. Whether this was a "vessel collision claim" or not was a factual determination which could only be made by the trial judge . Therefore the Court could not strike the defendant's claim.
Freight Forwarder - Cargo - Carriage - Terms - Shipments - Himalaya Clause
Labrador-Island Link General Partner Corporation v. Panalpina Inc., 2019 FC 740
Précis: The Federal Court dismissed claims against a freight forwarder and preforming transporters on the basis the action was time barred and covered by a Himalaya clause.
Facts: This was a motion by the defendants for summary judgment to dismiss the action on the basis it was time barred. The underlying action arose from damage to two cargo shipments of aluminum conductor reels (collectively, the “Cargo”). The plaintiffs retained the defendant Panalpina to provide, inter alia, freight forwarding services for an electrical transmission project under a Freight Forwarding Service Agreement (“FFSA”) in which the plaintiffs would provide specifics of cargos and make a Request for Quotation (“RFQ”) for Panalpina to obtain quotes from carriers for the shipment of same. If the quote was accepted, the plaintiffs would issue Panalpina a Material Moving Ticket (“MMT”) which confirmed various details about a cargo’s movement. Panalpina contracted the defendant Logistec Stevedoring Inc. for the receipt and storage of the Cargo at its terminal in Trois-Riviers, and also contracted the defendant Desgagnes Transarctik Inc. for the transportation of the Cargo by sea. The Cargo was to be shipped by sea from Quebec to Newfoundland, with the first shipment shipped on 28 May 2015 (the “May Shipment”) and the second on 28 October 2015 (the “October Shipment”). During discharge operations both the May Shipment and October Shipment were found to be damaged, and the Plaintiff put Panalpina on notice of intent to claim for damages to the Cargo on 09 September 2015 and 02 November 2015 respectively. The plaintiff commenced the underlying action for damages on 29 May 2017.
To be decided by the Court was whether Panalpina could invoke the nine-month limitation period prescribed by the Canadian International Freight Forwarders Association Standard Trading Conditions (the “CIFFA Terms”), or in the alternative, whether any of the defendants can rely on the one year time limitation under the Hague Rules as incorporated by reference in the sea waybills issued by the defendant Desgagnes, either on the basis of the Paramount clause in the sea waybill, a sub-bailment, or the Himalaya clause contained in the booking notes between the plaintiffs and Panalpina.
Decision: Motion granted, action dismissed.
Held: The Court rejected the plaintiffs’ arguments that Panalpina never advised it of the CIFFA Terms and that the CIFFA terms contradicted the FFSA terms in that the CIFFA Terms provisioned a shorter limitation period than the provincial laws of Newfoundland and Labrador which were referred to in the FFSA. The Court found that the CIFFA Terms were brought to the attention of the plaintiffs by the explicit reference to those terms in Panalpina’s quotes provided in the document pursuant to the RFQ, and that the plaintiffs would issue MMTs in response approving the terms proposed by Panalpina. On the second argument, the Court found that the CIFFA Terms did not contradict the FFSA terms as on a plain reading of the FFSA the reference to laws of Newfoundland and Labrador and Canada were only to apply to the construction of the FFSA and resolution of any dispute arising in respect of the FFSA itself. The Court held that the Himalaya clause in section 2 of the CIFFA Terms also covered the defendants Desgagnes and Logistecs as that clause extended the benefit of the carrier’s contractual limitations to sub-carriers or other third parties engaged by the carrier to assist in the transportation of goods. The Court further held that, even if it were wrong on the Himalaya clause, the sea waybills had named the plaintiffs and the preforming carrier which had incorporated the Hague Rules to the carriage and thus a one-year time limitation applied.
Mortgage - Innocent Purchaser - Validity of Foreign Mortgage - Limitation Period Applicable - Application of Provincial Laws
Lakeland Bank v. The Ship NEVER E NUFF, 2016 FC 1096
Précis: The Federal Court gave judgment in rem in favour of a U.S. mortgagee notwithstanding the sale of the vessel to an innocent purchaser. Provincial laws requiring registration of a mortgage had no application in the circumstances.
Facts: The plaintiff loaned funds to the first defendant in 2007 for the purchase of a vessel and registered a mortgage against the vessel in the United States, the location of the vessel at the time. The first defendant defaulted on the loan and the plaintiff obtained an in personam judgment against him in the United States. The plaintiff was, however, unable to obtain an in rem judgment against the vessel as it had been moved to Canada and resold to the second defendant. The plaintiff learned of the sale in January 2009. In June 2012, the plaintiff brought this proceeding in the Federal Court of Canada in personam against the first and second defendants and in rem against the vessel. The court dismissed the in personam claim against the first defendant on the grounds that the Statement of Claim was never served on him and, in any event, the issue of his liability was res judicata. The court also dismissed the in personam claim against the second defendant as he was merely an innocent purchaser for value without notice of the mortgage. The remaining issue was the in rem claim and the validity of the mortgage.
Decision: Judgment for the plaintiff on the action in rem.
Held: The in rem action against the vessel was vigorously defended by the second defendant who argued, first, that the plaintiff had failed to prove the mortgage was valid under American law. However, the plaintiff was not required to present evidence of American law because it was not asserting any greater rights under American law than under Canadian law. With no evidence of American law, Canadian law is presumed to apply. The mortgage was valid under Canadian law and lack of registration is of no effect.
The second defendant next says the claim is subject to a three-year limitation period under either American law or pursuant to s. 140 of the Marine Liability Act. The plaintiff has not led proper evidence of a three-year limitation period under American law and fails on this account. With respect to the three-year limitation period contained in s. 140 of the Marine Liability Act, this limitation period does not apply since it was only enacted in September 2009 and does not have retroactive effect. In the Federal Court limitation/prescription periods are matters of procedure governed by the lex fori, except perhaps with respect to matters arising wholly within Quebec. The applicable limitation period is six years under s. 39(2) of the Federal Courts Act. The Statement of Claim was filed in June 2012, within six years of the plaintiff becoming aware of the sale.
Finally, it is argued that under Quebec law the mortgage is invalid since it was not registered as required by the Quebec Civil Code. If this was purely a Quebec matter, the mortgage could have been registered under the Civil Code and enforced in the Federal Court. It does not, however, follow that failure to register renders the mortgage unenforceable. This is a constitutional issue that must be considered in light of Ordon v Grail,  3 SCR 437, as modified by Marine Services International Ltd. v Ryan Estate, 2013 SCC 44. They set out four factors to consider, each of which are addressed below.
(1) Is a mortgage on a ship a matter within exclusive federal competence under the navigation and shipping power?
Although contracts of sale and insurance are within provincial competence as being matters of property and civil rights, the sale of a ship and marine insurance are also matters of navigation and shipping and form part of Canadian maritime law. Mortgages on maritime property clearly fall within Canadian maritime law and are subject to federal jurisdiction.
(2) Is there a federal statutory counterpart to the provisions of the Quebec Civil Code?
It is not necessary to determine if there is a federal statutory counterpart to the provisions of the Quebec Civil Code in this matter as the Canada Shipping Act 2001 would not have applied to an American ship and an American mortgage.
(3) If there is no federal statutory counterpart, should non-statutory Canadian maritime law be altered?
Canadian maritime law need not be altered as it currently recognizes unregistered mortgages.
(4) If the non-statutory Canadian maritime law should not be changed, does the provincial law trench upon a protected core of federal competence?
The provincial law in this case does trench upon a protected core of federal competence. This is not a case such as Ryan Estate where it was noted provincial workers’ compensation laws had applied to maritime matters for more than a century. Here, in the case of conflict, federal law is paramount.
Comment: The learned Judge appears to conflate the constitutional doctrines of interjurisdictional immunity and paramountcy. On the one hand, he discusses trenching upon the protected core of federal competence which is the language of interjurisdictional immunity. On the other hand, he says that the federal law is paramount, which is the language of paramountcy. It is therefore unclear which doctrine was ultimately relied upon to reach the decision that federal law applied. Moreover, to the extent that the Judge relied on the doctrine of paramountcy, he appears to have applied the doctrine to non-statutory Canadian maritime law which is, in essence, the common law. However, in Marine Services International Ltd. v Ryan Estate, 2013 SCC 44, the Supreme Court of Canada said that the paramountcy doctrine does not apply to an inconsistency between the common law and a valid provincial enactment.
Personal Injury - Dependants' Claims - Applicable Limitation Period - Bereavement Claim under Alberta Statute
Toney v. Canada, 2014 ABQB 585
Précis: The Alberta Court of Queen's Bench struck a claim for personal injuries that was made out of time and questioned whether "grief" claims allowed under the provincial act could be made in an incident governed by maritime law.
Facts: This proceeding arose out of a boating accident on an Alberta lake in which a five year old child died. The accident occurred on 27 September 2008 and was witnessed by the plaintiffs, the parents and siblings of the deceased child. The plaintiffs alleged Canada (the Royal Canadian Mounted Police) and Alberta (the Alberta Fish & Wildlife Department) were negligent in mounting and carrying out search and rescue operations. The plaintiffs’ claim was originally filed in the Federal Court against both Canada and Alberta but was dismissed as against Alberta on 18 December 2013 on the grounds that the Federal Court was without jurisdiction (reported at 2013 FCA 217). The remaining claim in the Federal Court against Canada was stayed on 23 October 2013 at Canada’s request pursuant to s. 50.1 of the Federal Courts Act. This permitted the plaintiff to commence these proceedings in the Alberta Court of Queen’s Bench against Canada (otherwise such a claim had to be brought exclusively in the Federal Court) and also permitted Canada to file third party proceedings against Alberta. The plaintiff commenced these proceedings on 20 November 2013, more than five years after the accident. The defendants brought this application to strike the plaintiffs’ claim on the grounds that the claim was statute barred. The defendants argued that the applicable limitation period was two years from the date of death pursuant to s. 14(2) of the Marine Liability Act which governs claims by dependants. The plaintiffs, on the other hand, argued that their claims were not dependants’ relief claims but claims for their own personal suffering. The plaintiffs further argued that any limitation period should not commence before June 2011 when an inquiry was held and they learned the details of the accident and the defendants’ involvement. The Plaintiffs also claimed for “grief” under the Fatal Accidents Act of Alberta.
Decision: All claims are struck with the exception of the claims for personal injuries as against Canada.
Held: A reading of the pleadings discloses the plaintiffs’ claims include nervous shock, post-traumatic stress and depression. Such claims are compensable personal injuries under Canadian maritime law, are not derivative claims and are not restricted in any way by s. 6 of the Marine Liability Act. The limitation period applicable to such claims is either the two year period in the Athens Convention, if the plaintiffs were passengers, or the three year period set out in s. 140 of the Marine Liability Act. In respect of the personal injury claims against Canada, s. 50.1 of the Federal Courts Act deems the date of commencement of the claim to be the date the original claim was filed in the Federal Court. That date was 26 September 2011, a date within three years of the accident. Since it is not plain and obvious the plaintiffs were passengers subject to the two year limitation period in the Athens Convention, the plaintiffs’ claims for personal injuries as against Canada should not be struck. However, in respect of the personal injury claims against Alberta, the deeming provision in s. 50.1 of the Federal Courts Act is not applicable. The date of commencement of the action against Alberta was more than five years after the accident, well past the three year limitation period in s. 140 of the Marine Liability Act. The plaintiffs’ argument that they did not discover the details underlying the cause of the accident until the inquiry in June 2011 is not accepted and the discoverability principle has no application. The personal injury claims against Alberta are out of time.
With respect to the claim for “grief” under the Fatal Accidents Act of Alberta, it is questionable whether such a claim can be made on constitutional grounds but this need not be decided as the limitation period applicable would be the two year period in the provincial Limitations Act. That limitation period expired on 28 September 2010.
Comment: Although the court correctly identified that there was a constitutional issue with respect to the “grief” claim advanced under the Fatal Accidents Act of Alberta, the determination that the provincial Limitations Act would apply to the “grief” claim is questionable. It has been repeatedly held that provincial limitation statutes do not apply to maritime matters.
Passengers - Athens Convention – Limitation Period – Suspension/Interruption
Gaudet v. Navigation Madelaine Inc., 2014 QCCS 4106
Précis: The Quebec Superior Court held that the provisions of the Quebec Civil Code could apply to extend the limitation period in the Athens Convention, although the court did not do so in the circumstances.
Facts: The plaintiff was a passenger on board the defendant’s vessel and was injured when a door closed on his index finger. The accident occurred on 12 March 2011. The plaintiff subsequently commenced proceedings in the Quebec Superior Court against the defendant on 4 December 2013, more than two years after the accident. The defendant brought this application to dismiss the claim on the grounds that the limitation/prescription period had expired.
Decision: Application allowed and claim dismissed.
Held: The plaintiff’s claim is governed by Canadian maritime law. Article 16 of the Athens Convention stipulates a two year limitation/prescription period from the date of disembarkation for claims for the death or injury of a passenger. The plaintiff argues that the three year limitation period in s. 140 of the Marine Liability Act applies or, alternatively, that the provincial limitation period applies pursuant to s. 39 of the Federal Courts Act. However, these provisions only apply if there is no specific prescribed limitation period. Here there is a prescribed period namely, the two year period in the Athens Convention. The plaintiff further argues that the limitation period should be extended or interrupted because he was not able to fully quantify his claim until he received his expert assessment on 14 November 2013. Article 16(3) of the Athens Convention provides that issues of suspension or interruption of the limitation period are to be governed by the law of the court seized of the case and Art. 2904 of the Civil Code provides for suspension/interruption of limitation periods in limited circumstances. However, ignorance of the exact extent of the damage is not a grounds for suspending a limitation period.
Comment: The holding in this case that Art. 2904 of the Quebec Civil Code could apply to extend the limitation period is questionable. Cases to the contrary include: MacKay v. Russell, 2007 NBCA 55; Frugoli v. Services aeriens des Cantons de l’Est inc., 2009 QCCA 1246; and Malcolm v. Shubenacadie Tidal Bore Rafting Park Limited, 2014 NSSC 217.
Athens Convention - Limitation Period - Provincial Limitation Laws not Applicable - Change in legislation not given retrospective effect - No Discretion to Extend Limitation Period - Choice of Provincial Law in Contract
Malcolm v. Shubenacadie Tidal Bore Rafting Park Limited, 2014 NSSC 217
Précis: The Nova Scotia Supreme Court held that the limitation period applicable to a river rafting accident that occurred prior to the 2009 amendments to the Marine Liability Act, was the two year limit in the Athens Convention which could not be extended even though the plaintiff was an infant.
Facts: In August 2008 a twelve year old boy fell out of a zodiac owned and operated by the defendant while participating in a rafting excursion on the Shubenacadie River. Although the boy suffered immediate personal injuries which required treatment, this action in the Nova Scotia Supreme Court was not commenced by his litigation guardian until 23 May 2013. The defendant brought this motion to strike the statement of claim on the basis that the limitation period had expired. The plaintiff argued: (1) that the Nova Scotia Limitation of Actions Act applied; (2) that the amendments made to the Marine Liability Act in 2009 exempting adventure tourism activities from the Athens Convention ought to be given retrospective effect; (3) that any limitation period ought to be postponed as the plaintiff was an infant at the time of the accident: and (4) that the "Waiver" signed by the plaintiff, which provided for Nova Scotia law, had the effect of making the claim subject to the law of Nova Scotia and not Canadian maritime law.
Decision: Order granted. The action is dismissed.
(1) Any question of the limitation period applicable to this claim is settled as being the two year limitation period in Article 16 of the Athens Convention attached as Schedule 2 to the Marine Liability Act, S.C. 2011, c.6. The decision of the Supreme Court of Canada in Marine Services International v Ryan Estate, 2013 SCC 44, which reframed the constitutional test for determining when provincial laws can apply to maritime matters does not undermine the rationale for the earlier decisions applying the Athens Convention to these types of claims. "The important objective of uniformity in Canadian maritime law and in the international community of maritime states should not be undermined by the application of individual, and different, provincial statutory regimes."
(2) The fact that the Marine Liability Act was amended in 2009 to exempt adventure tourism activities from the application of the Athens Convention is not relevant. Limitation periods are substantive, not procedural, and the 2009 change in the Marine Liability Act is not to be given retrospective effect. The substantive law governing this claim at the time of the injury, including the limitation period, is the Marine Liability Act as it existed at the time.
(3) Section 4 of the Nova Scotia Limitation of Actions Act, which provides for the suspension of limitation periods for claims by infants, has no application as it is not part of federal maritime law. The Athens Convention and the Marine Liability Act contain no provisions postponing limitation periods for infants and without such a provision there is no basis for the Court to do so. Further there is no general discretion to suspend or postpone the limitation period. Under the Athens Convention the two year limitation period commences to run from a fixed event, the disembarkation of the passenger, and the discoverability principle has no operation. The only provision in the Athens Convention permitting suspension or interruption of the limitation period is Art.16 s.3, which allows for a maximum extension of up to 3 years from the date of disembarkation.
(4) With respect to the "Waiver", it merely says that the laws of Nova Scotia shall apply. Nova Scotia law includes federal law. The "Waiver" incorporates rather than excludes Canadian maritime law.
Comment: It is arguable that this case is correctly decided but for the wrong reasons. Specifically, the holding that limitation provisions are always substantive and will never be given retrospective effect is questionable. As discussed in St. Jean v Cheung, 2008 ONCA 815, a decision by the Ontario Court of Appeal, limitation provisions may be classified as procedural or substantive and may have retrospective application depending on their effect. The changes to the Marine Liability Act in 2009 had the effect of exempting adventure tourism activities from the two year limitation period contained in Athens Convention and substituted the three year period contained in s.140. For this action, at the time the changes to the Marine Liability Act came into force on 21 September 2009, the two year period under the Athens Convention had not expired and the effect of s. 140 was to extend the time within which the plaintiff could bring its action to August 2011. In such circumstances, under the approach discussed in St. Jean v Cheung, the amendments arguably should have been given retrospective effect and the limitation period would have expired in or about August 2011.
Pleadings- Motion to Strike - Expiry of Limitation Period - Continuation of Earlier Action
Adventure Tours Inc. v. St. John's Port Authority, 2014 FCA 172
Précis: The Federal Court of Appeal refused to strike a claim against a port authority for abuse of public office as being made out of time when it was a continuation of an earlier action and filed with leave of the court.
Facts: The plaintiff previously commenced proceedings against the defendant Port Authority for the tort of abuse of public office. The statement of claim in that action was ultimately ordered to be struck by the Federal Court of Appeal in a decision rendered on 10 June 2011 (reported at 2011 FCA 198). In that decision the Court of Appeal expressly gave the plaintiff leave to file a fresh statement of claim properly pleading the facts and elements of the tort. However, instead of filing a fresh statement of claim, the plaintiff commenced this entirely new action. The defendant brought this motion to strike the new statement of claim on the grounds that it was commenced out of time. The motion was dismissed by the Prothonotary and an appeal from that order was later dismissed by an appeal Judge (reported at 2012 FC 592). The defendant filed a further appeal to the Federal Court of Appeal.
Decision: Appeal dismissed.
Held: It would be inappropriate to strike a statement of claim that has been filed with the leave of this Court. It is not plain and obvious the action cannot succeed since the new action appeared to be a continuation of the earlier action that had been filed in time.
Substitution vs Addition of Party After Limitation Period Expiry - Applicable Limitation Period to claim by Passenger Against Repairer - s. 140 MLA - When s. 140 MLA Commences to Run
Sperling v. The Queen of Nanaimo, 2014 BCSC 326
Précis: The British Columbia Supreme Court held that a defendant could be added as a party to an existing action notwithstanding the expiry of the limitation period under s. 140 of the Marine Liability Act and where the court further held that the limitation period in s. 140 of the Marine Liability Act does not commence to run until the underlying material facts and the extent of the injury are known.
Facts: The plaintiff was injured when the ferry “Queen of Nanaimo” hit the dock at Village Bay Terminal on 3 August 2010. A malfunction in the propulsion equipment of the ferry was implicated in the cause of the accident. The plaintiff originally commenced proceedings on 2 August 2012 against the owner/operator of the ferry as well as “John Doe 1, ABC Company and John Doe 2”. The plaintiff now sought to add a number of additional companies alleging they were involved in the installation or repair of the malfunctioning equipment. The plaintiff argued the proposed parties could be substituted for “ABC Company” on the basis of correction of a misnomer in the pleading or, in the alternative, that the rules permitted the addition of the proposed parties in the circumstances. The proposed defendants challenged the motion on the basis, inter alia, that the limitation period had expired. The issues were:
1. Can the proposed parties be substituted for “ABC Company” on the basis of a misnomer in the pleading?
2. If this is not a case of misnomer, can the additional parties be added if a limitation period has intervened?
3. What is the applicable limitation period? Is it two years under the Athens Convention or three years under s. 140 of the Marine Liability Act?
4. If the Limitation period is under s. 140 of the Marine Liability Act, from what date does the limitation period commence to run and has it expired?
Decision: Motion allowed, in part.
(1) There is an important distinction between amendment applications to correct a misnomer in a pleading and applications to add a party. The correction of a misnomer is permitted notwithstanding the expiration of a limitation period after the action was originally commenced. On the other hand, where the application is to add a party, the expiration of a limitation period will be one of the factors taken into account in the court’s determination of whether it is “just and convenient” to add the new party.
The test for correcting a misnomer is whether the party is sufficiently described in the pleading as an identifiable and identified person by role, responsibility or involvement. In this case the plaintiff lumps defendants together and makes blanket allegations without meaningful distinctions. The activities described are so broad they could apply to many people. There is insufficient particularity in the pleading to point the finger at any distinct person. Therefore, this is not a case of misnomer.
(2) A new party may be added at any stage of a proceeding where it is just and convenient to do so. The existence of a limitation defence is a relevant but not a determinative factor. In this case the parties disagree as to whether a limitation defence has accrued. The proposed defendants argue that the court has no discretion to add them as parties, if the limitation period under the Marine Liability Act has accrued. The court does not agree. Even if a limitation period has accrued under the Marine Liability Act, the court still has a discretion to add parties.
(3) The limitation period of two years in art. 16 of the Athens Convention, enacted by the Marine Liability Act, applies only to “carriers” and has no application to the proposed defendants. The application of the three year limitation period in s. 140 of the Marine Liability Act is challenged by the plaintiff on the grounds that the negligent acts alleged against the proposed defendants have nothing to do with navigation and shipping. The proposed defendants, on the other hand, say that the subject matter of the claim is squarely in the domain of federal maritime negligence law and s. 140 of the Marine Liability Act therefore applies. This is a difficult issue but it need not be decided since, in any event, the discoverability issue is to be resolved in the plaintiff’s favour.
(4) The Marine Liability Act does not provide for the postponement or extension of the three year limitation period. However, the s. 140 limitation period commences on the day the cause of action arose which, pursuant to the discoverability principle, means it does not commence until the underlying material facts and the extent of injury are known. The plaintiff did not receive the investigation report identifying the malfunctioning equipment until 20 May 2011. This is the earliest date from which the limitation period could commence. Therefore, even if the three year period applies, it has not expired.
Pleasure Craft Accident – Personal Injury – Applicable Limitation Period – Date From Which s.140 MLA Limitation Period Runs - Application of Provincial Laws
G.B. v. L. Bo, 2014 QCCS 18
Précis: The Quebec Superior Court held, in respect of an event that occurred before s. 140 of the Marine Liability Act was enacted, that the three year limitation period under that section commenced to run on the date s.140 came into force.
Facts: The plaintiff was injured on 4 July 2008 while surf skiing behind his own boat which was being driven by the first defendant. At the time, the plaintiff and first defendant were living together. On 13 June 2012, almost four years after the accident, and one year after the couple separated, the plaintiff commenced these proceedings against the first defendant and against the plaintiff’s own insurance broker, the second defendant. The defendants brought these motions to dismiss the proceedings on the grounds, inter alia, that the limitation period had expired.
Decision: Motions dismissed.
Held: The issue of the applicable law governing limitation periods in a case such as this is a difficult one. In Frugoli v Services aeriens des Cantons de l’Est inc., 2009 QCCA 1246, the Quebec Court of Appeal affirmed that the two year limitation period in s. 14(1) of the Marine Liability Act applied to a claim by dependants of two passengers who were drowned when their boat capsized on a lake in Northern Quebec. On the basis of this case, it is concluded that Canadian maritime law governs the limitation period in the present case. However, as this is neither a claim by dependants nor an accident arising out of a collision between two vessels, ss. 14 and 23 of the Marine Liability Act have no application. The relevant section would be s. 140 which provides a period of three years “after the day on which the cause of action arises”. But, s. 140 was not enacted until 23 June 2009 and became law on 21 September 2009. Therefore, there was no limitation period in effect during the period from the date of the accident, 4 July 2008 to 21 September 2009. The three year period under s. 140 did not begin to run until 21 September 2009 and did not expire until 21 September 2012. This action was therefore commenced within the limitation period.
Comment: The approach adopted by the Quebec Superior Court in this case is different from what is arguably the more traditional approach as discussed in St. Jean v Cheung, 2008 ONCA 815, a decision by the Ontario Court of Appeal. The more traditional analysis distinguishes between retroactive and retrospective statutes. If the new limitation provision extinguishes an existing claim, it is retroactive and will not apply. However, if the new provision merely abridges (or extends) the time left to bring a claim, it is retrospective and will apply. If this approach had been followed in this case, s. 140, which came into force on 21 September 2009, should have been given retrospective effect since it did not extinguish the claim on its coming into force but merely created a new three year limitation period expiring on 4 July 2011. As the plaintiff did not commence proceedings by 4 July 2011, the claim was out of time.
Fatal Accident - Limitation Periods - Application of Provincial Statutes
Frugoli v. Services Aériens des cantons de L'Est inc., 2009 QCCA 1246
This was an action by dependents of two persons who were presumed drowned when the boat they were in capsized. The boat had been chartered and operated by the defendant. The issue was whether the limitation period was the three year period prescribed in the Quebec Civil Code, the two year period prescribed by s. 14(2) of the Marine Liability Act (MLA”) or the two year period as prescribed by Art. 16(2) of the Athens Convention as enacted by the MLA. Due to a mistake by plaintiff’s counsel, the action was commenced more than two years after the accident but less than three years. The Trial Judge reviewed the various authorities and held without much difficulty that the claim should be subject to federal maritime law and not the Quebec Civil Code. The Trial Judge next considered whether it was the two year period in the MLA or the two year period in the Athens Convention that applied and whether the period could be extended. The issue was relevant because Art. 16(3) of the Athens Convention provides that “the law of the court seized of the case shall govern the grounds of suspension or interruption” of the limitation period. The Trial Judge held that the “law of the court seized of the case” meant Canadian maritime law. The Trial Judge then thoroughly reviewed the authorities and ultimately held that there was no discretionary power to extend the limitation period under maritime law except with respect to a collision action governed by s. 23 of the MLA. Finally, the Judge was of the view that in any event an error of counsel was not sufficient grounds for interruption or suspension of the limitation period in the circumstances. On appeal, the Quebec Court of Appeal held that it was “perfectly clear” the matter was governed by Canadian maritime law, that the provincial legislature had no jurisdiction and that the provincial limitation statute had no application. The Court of Appeal next addressed the issue of whether the court had a discretion to extend or suspend the two year limitation period in the MLA and agreed with the Trial Judge that the express inclusion of the discretionary remedy in s. 23 of the MLA dealing with collisions implied, as a matter of statutory interpretation, that there was no discretion for other limitation sections of the MLA. Although this was sufficient to dispose of the appeal, the Court of Appeal went on to consider whether there was inherent jurisdiction to extend the limitation period and held that there was not.
Carriage of Goods - Limitation Period - Counterclaim
Hapag-Lloyd Container Line GmbH v. Moo Transport & Commodities Inc., 2009 FC 201
The issue in this case was whether a counterclaim for damage to cargo and non-delivery should be dismissed on the grounds that the counterclaim was made out of time. The moving party relied upon a clause in the bill of lading that stipulated the carrier would be discharged from all liability unless suit was brought within one year (almost identical wording to the limitation period in the Hague/Hague-Visby Rules). The Court gave effect to the clause noting that this wording had the effect of completely excluding any cause of action rather than merely barring a remedy. In result, the counterclaim was dismissed.
Pleadings - Amendment - Limitation Period
Bank of the West v. The 26' Well Craft Scarab (Ship), 2007 FC 1112 (CanLII)
The Defendant marine insurer sought leave to amend its pleading to plead a limitation period contained in its policy. At first instance the Prothonotary denied the application without giving reasons. On appeal, the motions Judge noted the general rule is to allow amendments at any stage of an action provided there is no prejudice or injustice to the other party that cannot be compensated for in costs. Given that the proceeding had not advanced significantly and the Plaintiff was unable to identify any particular prejudice, the Judge allowed the appeal and gave leave to the Defendant to plead the limitation period defence.
Personal Injury - Athens Convention - Limitation Period - No Power to Extend - Applicable Law
Russell et al. v. MacKay, 2007 NBCA 55
The Plaintiff was a passenger on a whale watching vessel and was injured at sea when she tripped over a cooler while leaving the washroom on the vessel. The accident occurred on 3 August 2003 but action was not commenced until 20 July 2006. The Defendants brought this motion to dismiss the Plaintiff's claim on the grounds that it was statute-barred by the two year limitation period in the Athens Convention as enacted by the Marine Liability Act. The Plaintiff argued that the applicable limitation period was six years as provided the New Brunswick Limitation of Actions Act. Alternatively, the Plaintiff argued that the Court had the discretion to suspend or interrupt the running of the limitation period. The trial Judge concluded that the Plaintiff's claim was in pith and substance in relation to navigation and shipping and governed by federal Canadian maritime law and not the provincial limitations statute. The trial Judge then considered whether the court had a discretion to suspend or interrupt the running of the limitation period. The trial Judge referred to art. 16(3) of the Athens Convention which provides that “The law of the court seized of the case shall govern the grounds of suspension and interruption of limitation periods...”. The trial Judge held that the phrase “law of the court seized of the case” referred to Canadian maritime law and not the law of New Brunswick. The trial Judge noted that a three part test had been established to determine when an extension of a limitation period should be made under s. 572(3) of the Canada Shipping Act and that this was the appropriate test to apply. The test was: 1. did the Plaintiff have a valid prima facie case; 2. was the Defendant aware of the claim and would it suffer prejudice by an extension, other than the loss of the limitation defence; and 3. having regard to all the circumstances, was it in the best interest of justice that time be extended. Applying this test the trial Judge held it was in the best interests of justice that the limitation period be interrupted or extended.
On appeal to the New Brunswick Court of Appeal, the Court of Appeal agreed with the trial Judge that the case was to be governed by federal maritime law and further agreed that the limitation period was to be found in the Athens Convention but disagreed with respect to the powers of the court to suspend or extend the limitation period. Specifically, the Court of Appeal said that the trial Judge erred in relying upon and applying the test flowing from the old s. 572(3) of the Canada Shipping Act which dealt with collisions between ships (as does its successor in s.23 of the Marine Liability Act ) not injuries to passengers. The Court said that Art. 16 of the Athens Convention did not include any power to extend the limitation period and held that superior courts do not have inherent powers to extend limitation periods. The Court of Appeal next considered the meaning of Art. 16(3) and noted that the reference to the law of the court seized of the case did not imply such law would necessarily provide grounds for suspension or interruption. The Court held that there was no federal legislation that would provide grounds for suspension or interruption. Finally, the Court considered whether the law should be reformed to include a power to suspend or interrupt a limitation period and suggested, without deciding, that 1) waiver; (2) estoppel; (3) absence from the jurisdiction; (4) infancy; and (5) mental incompetency might be grounds. However, as the evidentiary record supported none of these grounds, the matter was not decided.
Collision - Limitation Period - Extension
Rioux v. Bégin, 2007 QCCQ 4119
The issue in this case was whether the Court should exercises its discretion under s.23(2) of the Marine Liability Act to extend the limitation period. The Plaintiff was an infant and the limitation period had apparently been missed because legal advisors thought the provincial limitation period of two years applied. The Court granted the request for an extension. (Note: Unfortunately, this decision is only published in the French language, a language in which the author is not fluent, and it is not entirely clear to the author why the extension was granted.)
Marine Insurance – Bad Faith – Limitation Period - Pleading – Striking – Reasonable Cause of Action
Forestex Management Corp. et al. v. Underwriters at Lloyds et al., 2004 FC 1303
“Many years ago when small boys wore suspenders and ships had gender...” So begins the Reasons for judgment of Prothonotary Hargrave in this application by the Defendants to strike out the Statement of Claim of the Plaintiff. The facts were that on 4 August 2000 the “Texada” went aground in a passage in the Queen Charlotte Islands and was subsequently declared a constructive total loss. The Plaintiff gave underwriters notice of the casualty on 8 August 2000 and underwriters denied coverage for breach of the trading warranty on 10 August 2000. The Plaintiff subsequently commenced an action against underwriters for coverage under the policy of insurance. That action was, however, dismissed following a status review on 9 January 2003. The dismissal was appealed by the Plaintiff but the appeal was not served. The Plaintiff attempted to bring on a motion ex parte to extend the time to serve the appeal but was ordered to serve the underwriters. This was not done and the Federal Court of Appeal dismissed the appeal for delay on 13 January 2004. The Plaintiff subsequently commenced the present action against underwriters alleging bad faith. The Defendant underwriters filed a Statement of Defence and brought the present motion to dismiss the action on various grounds. However, as they had filed a Statement of Defence the Prothonotary held that they were only entitled to argue that the Statement of Claim failed to disclose a reasonable cause of action. The thrust of the Defendants argument was that there could be no action for bad faith without an initial finding that there was coverage under the policy. The Prothonotary first considered the requirements of an action for bad faith. He reviewed American and Canadian authorities and noted that although a claim under a policy and a claim for bad faith are two distinct causes of action they are related in that a claim for bad faith cannot succeed unless there is a finding that there is coverage under the policy. He next considered the effect of the dismissal of the claim under the policy and held that an order dismissing an action for delay does not set up a res judicata defence and therefore, subject to any time bar defence, does not prevent a Plaintiff from re-commencing an action. The Prothonotary next considered whether there was a limitation period that would bar the Plaintiff from re-commencing an action on the policy. The Court was referred to s. 39 of the Federal Court Act which incorporates provincial limitation periods and was urged to apply the one year limitation period set out in section 22(1) of the British Columbia Insurance Act. However, the Prothonotary questioned whether the British Columbia Insurance Act extended or ought to extend to marine insurance, a federal undertaking. The Prothonotary did, however, apply the two year limitation period in the British Columbia Limitations Act and applying that period held that the action was not time barred. (The denial of coverage occurred on 10 August 2000 and the bad faith action was commenced on 9 August 2002.) Accordingly, the Prothonotary noted that the existing bad faith action could be amended by adding a supporting claim under the policy and held that if this was done it was not plain and obvious and beyond doubt that the Plaintiff's action could not succeed. In result, the motion to strike the claim was dismissed.
Freight - Set-off - Hague-Visby Rules - Limitation/Prescription - Exculpatory Clauses
Mediterranean Shipping company S.A. v. Sipco Inc., 2001 FCT 1046
The Plaintiff in this action claimed against the Defendant for ocean freight owing in respect of the carriage by sea of nine containers from Toronto to the Persian Gulf. The Defendant admitted non-payment of freight but alleged that it was entitled to a set-off and brought a counterclaim alleging breaches of the contract by the Plaintiff. Specifically, the Defendant alleged that seven of the containers were shipped together, that six of those seven containers arrived on time at the port of discharge, that the seventh container did not arrive until months after its scheduled arrival, and that as a consequence the clearance through customs of all of the containers was delayed. The issues in the case were the entitlement to set-off and whether the Plaintiff had been negligent in its handling of the containers. On the first issue the Trial Judge reviewed the Anglo-Canadian authorities and concluded that there could be no right of set-off against freight under a contract for the carriage of goods by sea unless the contract specifically provided otherwise. As the contract did not provide otherwise, there was no right of set-off. The Trial Judge next turned to the counterclaim. The first defence raised against the counter-claim was that the claim had not been brought within the one year time period fixed by the Hague-Visby Rules. The success of this argument depended upon whether the prescription period set by the Rules ran from the date of discharge or the date of actual or constructive delivery to the consignee. The Trial Judge held that the prescription period runs from delivery not discharge and that any clauses in a bill of lading declaring delivery takes place at discharge are null and void. The Trial Judge further held that delivery takes place on the day the last piece of cargo is delivered, the seventh container in the case at bar. Accordingly, the Judge held the counterclaim had been commenced within time. The Judge next considered various defences raised by the clauses in the bill of lading, namely: a scope of voyage clause which gave the carrier complete discretion as to the ports at which to call; a period of responsibility clause which provided the carrier was not liable for damages occurring in the period before loading or after discharge; and a clause providing that there could be no claims for failure of the carrier to meet arrival or departure dates. The Judge held that these various clauses were contrary to the Hague-Visby Rules and therefore null and void pursuant art. 3 r. 8 of the Rules. The Judge next considered the damages suffered as a consequence of the breach of contract by the Plaintiff but found that the Defendant had failed to prove any damages. In result, therefore, the claim for freight was allowed and the counterclaim was dismissed.
Limitation Period - Extension of Time
Croisieres A.M.L. Inc. v. Goelette Marie Clarisse Inc., 2000 CanLII 16153
This was an application to extend the two year limitation period set by s. 572(1) of the Canada Shipping Act for the commencement of an action against a ship for damage to property or personal injury. The evidence showed that the Plaintiff had sent the Defendant a notice of its claim within the two year period. The Defendant acknowledged the notice and requested the Plaintiff send relevant documentation “without prejudice and without making any admission”. No further evidence or explanation was offered. The Court held that the evidence was not a sufficient explanation by the Plaintiff of the delay and dismissed the application.
Fatal Accidents - Limitation Periods - Application of Provincial Prescription Statute
Nicholson v. Canada,  3 FC 225
This was a summary judgment motion by the Crown for an order dismissing the claims of the Plaintiffs as time barred. The Plaintiffs were the dependents and the executor of the deceased who died when his vessel hit a rock and sank. The Plaintiffs alleged that the accident was caused by the breach of statutory duties on the part of the Coast Guard. The accident occurred on April 2, 1992, but the action was not commenced until March 30, 1994. The Defendant argued that the applicable limitation period was one year from the time of death as prescribed by section 649 of the Canada Shipping Act. (Note: This provision has since been amended and the limitation period is now two years.) The Plaintiffs argued that the discoverability principle operated to extend the time bar under the circumstances of the case, that the court had inherent jurisdiction to extend the limitation period, that there was a non-statutory cause of action to which section 649 did not apply, that the tolling provision of the Ontario Limitations Act applied, and that, in any event, the claim of the estate was not covered by section 649. The court dealt with each of these arguments. With respect to the discoverability principle (i.e. that the limitation does not run until the Plaintiff is aware of the material facts giving rise to a cause of action) the court held that this principle applied but that it did not assist the Plaintiffs as they were aware of the material facts at the conclusion of the inquest into the death of the deceased yet they did not commence their action within one year from that date. With respect to the inherent jurisdiction of the court to extend the limitation period, the court held that, in the absence of a clear statutory authority it had no such jurisdiction. (Note: This is contrary to the decision of the Ontario Court of Appeal in Dreifelds v Burton, (March 6, 1998) No. C 2456 &: C24580 (Ont. C.A.) but is consistent with the decision of the British Columbia Supreme Court in Vogel v Sawbridge, (April 3, 1996) No. 24638 Kelowna Registry.) With respect to the alleged common law non-statutory cause of action, the court held that there was no such cause of action. With respect to the argument that the tolling provisions of the Ontario Limitation Act applied, the court held that the incorporation of the tolling provisions would be inconsistent with the statutory scheme set out in Part XIV of the Canada Shipping Act. Finally, with respect to the action by the executor of the estate of the deceased, the court held that this action (which was newly created by the Supreme Court of Canada in Ordon Estate v Grail,  3 S.C.R. 437) was not time barred as it was not a claim by dependents and was governed by the two year limitation period in the Ontario Trustee Act as incorporated by section 39 of the Federal Court Act. (Note: It is not apparent why the limitation period in the Ontario Trustee Act would apply to the action by the executor as that action is a common law action and is not based on the Trustee Act.)
Suit Time Extensions
Riva Stahl GmbH v. The "Bergen Sea" et al., 1999 CanLII 8093
This was an appeal from a decision of the Trial Division in which an application for summary judgment by the Defendants based on a time limitation defence was allowed. The case illustrates the dangers to Plaintiffs of suit time extensions. The Plaintiffs in the case obtained a suit time extension from the shipowner to June 13, 1995. This extension was conditional on the Plaintiffs obtaining a similar extension from charterers. The Plaintiffs did obtain a suit time extension from charterers but it was to a date of June 30, 1995. This extension was also conditional on the Plaintiffs obtaining a similar extension from owners. The Plaintiffs were unaware of, or failed to appreciate that, the extensions were not similar in that they expired on different days. The Plaintiffs issued a Statement of Claim on June 28, 1995, two days before the charterer's extension expired but after the owner's extension had expired. Both Defendants brought a summary judgment application to dismiss the action as being out of time. The Trial Division granted the application holding that there was no binding agreement to extend suit time to either June 13, 1995 or June 30, 1995, and further holding that the Defendants had not waived the time bar defence and were not estopped from raising it by reason of their continued negotiations with the Plaintiffs. The Court of Appeal agreed with the Trial Judge that there were no effective time extensions in place when the action was commenced and that there was no waiver or estoppel.