McMurrich Monteith's conduct did not qualify as a 'continuous act or omission': court
The Ontario Court of Appeal ruled that a negligence claim against the township of McMurrich Monteith was statute-barred, finding that the township's alleged negligence did not qualify as a "continuous act or omission" under the Limitations Act.
The case arose from the respondents' 2021 purchase of a residential property in the township. After the purchase, they discovered significant defects in the dwelling's foundation and sued the township in February 2022, alleging negligence in supervising the original construction between 1986 and 1987. In its motion for summary judgment, the township argued that the ultimate limitation period barred the negligence claim because the alleged negligence occurred more than three decades ago.
The motion judge denied the township's request, ruling that it had a continuing duty to monitor the permit file and that its alleged negligence was ongoing, preventing the limitation period from running.
The Court of Appeal overturned this ruling, finding that the motion judge made two legal errors. First, the appeal court ruled that the motion judge misinterpreted the concept of a "continuous act or omission" under s. 15(6)(a) of the Limitations Act. The court clarified that a continuous act or omission requires repeated actionable conduct. Here, the township's involvement with the property ceased by at least 1988, when it issued a treasurer's certificate stating no outstanding work orders. The township considered the building permit closed and took no further action. The court concluded that "absolutely nothing happened" after 1988 that could constitute a continuous act or omission.
Second, the court found that the motion judge erred in recognizing a novel "duty to monitor" open building permit files without conducting a proper duty of care analysis. While municipalities must conduct building inspections reasonably, the motion judge extended this duty to require "regular surveillance" of permit files until a building was deemed substantially complete. The Court of Appeal ruled that no precedent established such a duty and that imposing it required a full legal analysis.
The court noted that Ontario's ultimate limitation period balances plaintiffs' right to sue with defendants' need for legal certainty. The court emphasized that limitation periods prevent lawsuits over latent defects discovered decades after construction, particularly when key witnesses are deceased and evidence has deteriorated.
In this case, all individuals involved in the dwelling's construction, including the original owner and the building inspector, were deceased. The township could not "follow up" on the construction status, and the existing permit file did not resolve key factual issues.
Ultimately, the court dismissed the respondents' lawsuit as statute-barred and clarified that homeowners can still recover damages for municipal negligence but must file their claims within the prescribed limitation period.
