Limitation periods prescribe the amount of time a party has to pursue a claim. If a claim is commenced beyond the expiration of a limitation period, it may be barred. In the family law context, limitation periods set out the timelines for a spouse making property claims. While courts do have the discretion to extend timelines, parties must also recognize the legislated time limits and proceed promptly with any claims they wish to pursue.
Ontario’s Family Law Act sets out limitation periods within which claims must be brought. Section 7(3) provides that claims for equalization of net family property shall not be brought after the earliest of:
However, courts do have discretion to grant an extension of time enabling a party to bring a claim. Section 2(8) of the Family Law Act enables courts to extend a time prescribed by the Act if:
Each of the three requirements must be met as a pre-condition before a court can exercise its discretion to extend a limitation period. The “relief” that the provision refers to is not the extension of time, but rather references the relief that is sought by a claim under the Family Law Act. This directs the court to undertake a limited inquiry into the merits of the proposed claim. In Werth v. Werth, the question before the judge was “but for the limitation period that acts as a bar, are there apparent grounds to support the claim?”
To meet the good faith requirement, the applicant must show they acted honestly and with no ulterior motive. In fulfilling the third requirement, the applicant must show there is no substantial prejudice, while any prejudice that does occur must be connected to the delay in starting the case. Courts have found that the passing of a limitation period creates a presumption of some prejudice to the responding party. In Busch v. Amos Justice Salhany remarked on the type of prejudice that could result, stating that:
“in my view, a spouse who arranges his financial affairs following separation or divorce upon the assumption that matters between him and a former spouse are resolved, is entitled to rely on the limitation period in the Family Law Act. It would seem to me that the purpose of the limitation period is to encourage finality so that the parties can get on with their lives.”
Courts have found that the length of the delay and the extent to which the responding party has rearranged their financial affairs are relevant considerations. Nevertheless, the mere finding that there may be some prejudice is not sufficient; the Act requires substantial prejudice.
El Feky v. Tohamy, involved an appeal from a decision granting summary judgement dismissing a claim for equalization of net family property because the application was barred by section 7(3) of the Family Law Act. The applicant sought to extend the time under section 2(8) to bring her claim. In her affidavit in support of her motion for an extension, the applicant claimed that she never received a copy of the final Divorce Order and had no knowledge that she was divorced until she returned to Canada from Egypt. She then sought legal advice and immediately brought an application, bringing a claim four months after the expiration of the limitation period.
Reviewing the circumstances, the Court heard that the applicant was vulnerable, faced health issues and was coerced into signing a divorce settlement agreement. While assessing whether the delay had been incurred in good faith, the Court noted that ignorance of the law, with no ulterior motive, in some circumstances, can amount to good faith provided the applicant had no reason to make inquiries. The Court of Appeal accepted that the applicant acted honestly. While she might have made inquiries earlier, there was nothing to suggest that the delay was deliberate.
The Court took a similar approach in Taylor v. Taylor. In this case, the wife commenced a claim ten months after the expiration of the limitation period. The wife had received limited advice from the Legal Aid office but issued the applications herself, which were refused several times by the courthouse. At the time, her primary concern was obtaining decision-making responsibility over the children and child support.
The wife’s affidavit indicated that she was not aware there was a deadline by which she had to file a claim. The Court accepted she was not told there was a limitation period, finding that the delay was incurred in good faith. The Court also acknowledged the wife’s personal circumstances, for example, that she had a mental illness, cared for two children, and dealt with her daughter’s mental health issues.
Limitations in the family law context differ from general limitations applicable to other actions. Courts have noted that limitation periods under the Family Law Act are more generous than the two-year timeline under the Limitations Act that governs many other actions. This is attributed to the unique situation facing spouses and families at the breakup of a marriage. This is further illustrated by the fact the Family Law Act does not provide a limitation period for seeking an order for spousal support. As the Court noted, these “special limitation periods account for the need to allow spouses more time to try to resolve their property issues without having to go to court, and the fact that a spouse or former spouse’s support needs can change over time and may be addressed whenever they do.”
Courts have recognized that limitation periods in family law can be more generous in recognizing the unique situation families and spouses find themselves in after divorce. However, any extension of time is discretionary, and parties should be aware of the limitation periods that govern their claims.
At NULaw, our trusted family lawyers help guide clients through the process of bringing a claim in family matters, including property division disputes. When dealing with complex divorce matters and ongoing negotiations, limitation periods are not often at the forefront of anyone’s mind. Working with a reliable family law lawyer can help simplify the process and ensure that all filing deadlines and limitation periods are adhered to, in order to obtain favourable outcomes for clients. Contact us online or call our office at 416-481-5604 to book a confidential consultation to discuss your divorce and property questions.