Civil Practice and Procedure - Limitation of Actions - Actions in tort
Canada Revenue Agency (CRA) confirmed that individual pension plan (IPP) set up by defendants L and S for plaintiff client had been accepted. Two years after client obtained second opinion, CRA confirmed that IPP did not comply with regulations and revoked registration. Client brought action against defendants for negligent financial advice and misrepresentation nine months after revocation. Motion judge dismissed defendants’ motion for summary judgment to dismiss action on basis that it was statute-barred. Judge held that requirements of s. 5(1)(a)(i) and (iv) of Limitations Act, 2002 were not met prior to CRA's final determination. Defendants’ reassurance that IPP was acceptable to CRA prevented client from discovering that loss had occurred. It was appropriate to bring action when CRA gave notice of revocation, as client knew she would be responsible for tax arrears and penalties. Judge held that claim was made within limitation period, which commenced at date of revocation. Defendants appealed. Appeal dismissed. Proceeding was not legally appropriate until date that CRA confirmed that IPP did not comply with requirements. There was no basis to interfere with judge’s acceptance of client’s characterization of claim as tax case because claim was based on tax consequences of revocation of her IPP. In light of conflicting advice client received, it was reasonable for judge to conclude that it was legally appropriate for client to wait until CRA responded to her counsel’s express inquiry before commencing proceeding.
Nelson v. Lavoie (2019), 2019 CarswellOnt 7965, 2019 ONCA 431, Alexandra Hoy A.C.J.O., P. Lauwers J.A., and B. Zarnett J.A. (Ont. C.A.); affirmed (2018), 2018 CarswellOnt 13843, 2018 ONSC 4489, Robert G.S. Del Frate J. (Ont. S.C.J.).
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