October 2011
This booklet is intended as a basic guide for persons who will be affected
by the Alberta Limitations Act. This guide should not be regarded as
a substitute for specific legal advice. Persons who require legal advice
should consult with legal counsel. A copy of the Act is included for your
convenience.
October 2011
The full text of the Act is found in Appendix 1 to this guide, including
amendments proclaimed in force up to October 1, 2011. The Act
significantly changed the law governing limitation periods in Alberta.
Subject to a grandfathering provision, and those claims which remain
under other statutes, it applies to all litigation commenced in Alberta
and to all claims governed by Alberta law. The Act provides a formula
for calculating limitation periods that is applicable to most actions.
Although the formula appears straightforward, its implications may
not be immediately recognized.
The second part of the formula, the 10-year ultimate limitation period,
may prove to be the most troublesome. The provisions which identify
this limitation period refer to a claim arising on the date when the
particular conduct or act occurred, not when the injury or damage
might have been suffered. As such, negligent acts which give rise to
injury or damage that may not occur until years later could well be
statute-barred. In this respect, the Limitations Act provides a shorter
limitation period than had been the case with the former court-devised
discoverability rule. One example of such shortening is with respect to
claims for negligence in, say, the design or construction of buildings,
where a failure of the structure or building may not occur until a
decade or more later. Such claims would appear to be statute-barred
if not commenced at the latest within 10 years of the completion of
the negligent design or construction of the structure or building,
regardless of the state of an injured person’s knowledge.
Exceptions
The only exception to the six-year rule was for claims in contract for
personal injuries, to which a two-year limitation period had applied.
Claims for economic loss, much like claims in contract, also had a six-
year limitation period. However, as this limitation period concerned a
tort (i.e., negligence) claim, it ran in most cases from the time that the
damage was discovered or discoverable (which could provide a longer
limitation period than a parallel contract claim for the same loss).
Renewal Practices
Many banks and other lending institutions had made a practice in the
past of obtaining renewal agreements, such as for promissory notes and
guarantees, from their customers and others within six years from the
execution of those documents. This practice arose, at least in part, as
a result of decisions which held the cause of action for certain demand
obligations arose immediately upon the execution of the agreement.
The intent of the new Act appears to be that time should run from
demand. However, for those who may regard the risk of a contrary
interpretation as still too great to ignore, the prudent practice may be
either to obtain renewal agreements or acknowledgments within the
two-year period or to take advantage of the provision in the Act which
Contracting Out
Record Keeping
How does the Limitations Act address claims that already existed prior to
March 1, 1999?
Any claims that were known, or ought to have been known, before
March 1, 1999 had to have been brought, at the latest by March 1,
2001. Claims that were not known or ought not to have been known
before the new Act are governed by the new Act. While the Act does
not expressly revive any undiscovered claims that had expired prior to
March 1, 1999, it has been held that in at least some circumstances a
time barred claim can be sued upon: Stuffco v. Stuffco (2006, Alta.C.A.).
The Act should not affect actions commenced earlier, but it does contain
provisions that may, in some circumstances, permit amendments
to such actions that could add new causes of action or new parties,
notwithstanding the expiry of a limitation period.
Can you be certain limitation periods for claims against you have expired?
The only certainty is the 10-year period. You will often not know when
a claim arose (e.g., when the breach of duty occurred), so there is even
some degree of risk in calculating when the ultimate limitation period
of 10 years has expired. And, a claim may fall within the extensions of
this 10-year period, such as a continuing course of conduct provision.
The courts may also retain discretion to extend the 10-year period in
exceptional circumstances. Even if a limitation period has expired, you
may be added as a defendant to an existing claim if certain factors are
satisfied (s. 6 of the Act).
Does the discoverability rule prevent claims being barred until they can
reasonably be known?
Under the two-year discoverability rule, time would not start running
until the claim was, or should have been, known. However, the 10-
year ultimate limitation period may cause some claims to be statute-
HER MAJESTY, by and with the advice and consent of the Legislative
Assembly of Alberta, enacts as follows:
Definitions
1 In this Act,
(a) “claim” means a matter giving rise to a civil proceeding in
which a claimant seeks a remedial order;
(b) “claimant” means the person who seeks a remedial order;
(c) “defendant” means a person against whom a remedial
order is sought;
(d) “duty” means any duty under the law;
(e) “injury” means
(i) personal injury,
(ii) property damage,
(iii) economic loss,
(iv) non-performance of an obligation, or
(v) in the absence of any of the above, the breach of a
duty;
(f) “law” means the law in force in the Province, and includes
(i) statutes,
(ii) judicial precedents, and
(iii) regulations;
Application
2 (1) This Act applies where a claimant seeks a remedial order in a
proceeding commenced on or after March 1, 1999, whether
the claim arises before, on or after March 1, 1999.
(2) Subject to sections 11 and 13, if, before March 1, 1999, the
claimant knew, or in the circumstances ought to have known,
of a claim and the claimant has not sought a remedial order
before the earlier of
(a) the time provided by the Limitation of Actions Act , RSA
1980 cL-15, that would have been applicable but for this
Act, or
(b) two years after the Limitations Act , SA 1996 cL-15.1,
came into force, the defendant, on pleading this Act as a
defence, is entitled to immunity from liability in respect
of the claim.
(2.1) With respect to a claim for the recovery of possession of land
as defined in the Limitation of Actions Act , RSA 1980 cL-15,
subsection (2) shall be read without reference to clause (b) of
that subsection.
Limitation periods
3 (1) Subject to section 11, if a claimant does not seek a remedial
order within
(a) 2 years after the date on which the claimant first knew, or
in the circumstances ought to have known,
(i) that the injury for which the claimant seeks a remedial
order had occurred,
(ii) that the injury was attributable to conduct of the
defendant, and
(iii) that the injury, assuming liability on the part of the
defendant, warrants bringing a proceeding, or
(b) 10 years after the claim arose,
whichever period expires first, the defendant, on pleading this
Act as a defence, is entitled to immunity from liability in
respect of the claim.
(2) The limitation period provided by subsection (1)(a) begins
(a) against a successor owner of a claim when either a
predecessor owner or the successor owner of the claim
first acquired or ought to have acquired the knowledge
prescribed in subsection (1)(a),
(b) against a principal when either
(i) the principal first acquired or ought to have acquired
the knowledge prescribed in subsection (1)(a), or
(ii) an agent with a duty to communicate the knowledge
prescribed in subsection (1)(a) to the principal, first
actually acquired that knowledge, and
(c) against a personal representative of a deceased person as a
successor owner of a claim, at the earliest of the following
times:
Concealment
4 (1) The operation of the limitation period provided by section
3(1)(b) is suspended during any period of time that the
defendant fraudulently conceals the fact that the injury for
which a remedial order is sought has occurred.
(2) Under this section, the claimant has the burden of proving
that the operation of the limitation period provided by section
3(1)(b) was suspended.
1996 cL-15.1 s4
Minors
5.1 (1) In this section,
(a) “guardian” means a parent or guardian having actual
custody of a minor;
(b) “potential defendant” means a person against whom a
minor may have a claim.
Agreement
7 (1) Subject to section 9, if an agreement expressly provides for
the extension of a limitation period provided by this Act, the
limitation period is altered in accordance with the agreement.
(2) An agreement that purports to provide for the reduction of a
limitation period provided by this Act is not valid.
RSA 2000 cL-12 s7;2002 c17 s4
Acquiescence or laches
10 Nothing in this Act precludes a court from granting a
defendant immunity from liability under the equitable
doctrines of acquiescence or laches, notwithstanding that the
defendant would not be entitled to immunity pursuant to this
Act.
1996 cL-15.1 s10
Conflict of laws
12 (1) The limitations law of Alberta applies to any proceeding
commenced or sought to be commenced in Alberta in which a
claimant seeks a remedial order.
(2) Notwithstanding subsection (1), where a proceeding referred
to in subsection (1) would be determined in accordance with
the law of another jurisdiction if it were to proceed, and
the limitations law of that jurisdiction provides a shorter
limitation period than the limitation period provided by the
law of Alberta, the shorter limitation period applies.
RSA 2000 cL-12 s12;2007 c22 s1
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