Tuesday, November 8, 2011

A Note on Law For a Change, Specifically S. 13(8) of the 2002, Limitatiions Act of Ontario

An adpated note from me to someone (with names and facts being changed to ensure anonymity and confidentiality):

...You'll recall our discussion and my previous email to you about the law that a payment on account starts the time running afresh for limitation period purposes concerning suing on an account.

Attached as scanned is the relevant section 13 from the Ontario 2002, Limitations Act.

Section 13 codifies the rule of acknowledgment, which in the case of payments on account has been put in these terms:

...It is familiar law that a payment by a debtor to his creditor, from which a new promise to pay may be inferred, has the effect of starting afresh the running of a period of limitation...

Note subsection 8 of section 13.

The $2,795.88 "payment" is shown on your August 4, 2011 statement.

What's intriguing in all this is the phrase "...from which a new promise to pay may be inferred..."

It may be arguable that that phrase does away with any payment necessarily being an acknowledgement for the purposes of s. 13(8). It may be argued that it's a factual question whether "a new promise to pay may be inferred," and that that inference has to be drawn from all the evidence. So if the payment came from Brunhilda's own account and was a payment in error, I can see an argument for not being able to infer a promise to pay here. In that case the plaintiff is stuck.

And that argument fits with the rationale for the rule of acknowledgement, which is that treating a debt as live and owing displaces the the rationales for limitation periods, being: the varieties of prejudice in stale cases caused by the passage of time; and the social interest in the timely prosecution of claims.

A problem you might face in all this is that limitation periods are perceived as "technical" defences and if courts can in good, or not so good, conscience avoid applying them, they'll sometimes be happy not to apply them. Which is to say, courts generally don't like people evading their obligations on technicalities.

No comments:

Post a Comment