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Competition - Limitations. Toronto Regional Real Estate Board v. Sunderland
In Toronto Regional Real Estate Board v. Sunderland (Fed CA, 2026) the Federal Court of Appeal dismissed appeals, these brought against the granting of motions to strike the claim in a proposed class action on grounds that they "not disclose a reasonable cause of action" - here brought "under the Competition Act, R.S.C. 1985, c. C-34 and relat[ing] to the commissions paid for buyer real estate brokerage services."
Here the court considers the Competition Act's statutory civil cause of action limitation provision:D. Limitation Period
[216] Paragraph 36(4)(a) of the Competition Act bars an action for civil damages two years after a day on which conduct contrary to Part VI occurs."Limitation"
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"Restriction"
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"36. (4) No action may be brought under subsection (1),"
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"36. ""(4) Les actions visées au paragraphe (1) se prescrivent :"
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"(a) in the case of an action based on conduct that is contrary to any provision of Part VI, after two years from"
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"a) dans le cas de celles qui sont fondées sur un comportement qui va à l’encontre d’une disposition de la partie VI, dans les deux ans qui suivent la dernière des dates suivantes : "
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"(i) a day on which the conduct was engaged in, or"
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"(i) soit la date du comportement en question,"
"(ii) the day on which any criminal proceedings relating thereto were finally disposed of,"
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"(ii) soit la date où il est statué de façon définitive sur la poursuite;"
"whichever is the later;"
"[blanc]" [217] Before the motion judge, the defendants contended that the claims for conduct prior to April 1, 2019—two years before the initial statement of claim was filed—were statute-barred.
[218] The motion judge concluded that it was not "“plain and obvious”" that the limitation period in subparagraph 36(4)(a)(i) barred the plaintiff’s claims or those of the other class members, relying on Godfrey. There, the Supreme Court of Canada held that the limitation period in subparagraph 36(4)(a)(i) is subject to the common law rule of discoverability and does not begin to run until "“the material facts on which [the plaintiff’s] claim is based were discovered by him or ought to have been discovered by him by the exercise of reasonable diligence”": Godfrey at para. 50. Under the rule of discoverability, a limitation period will begin to run "“when a plaintiff has knowledge, actual or constructive, of the material facts upon which a plausible inference of liability on the defendant’s part can be drawn”": Grant Thornton LLP v. New Brunswick, 2021 SCC 31 at para. 42 [Grant Thornton]. The parties do not dispute that this a correct statement of the law.
[219] The defendants allege that the motion judge committed two errors: first, in finding that, absent an agreement between the parties on the relevant facts, it was inappropriate to adjudicate a limitation period issue before the defendants pleaded a limitations defence; and second, in finding that a factual inquiry was necessary to determine whether the plaintiff or other proposed class members knew or ought to have known about the Buyer Brokerage Commission Rule. The defendants assert that the pleaded facts in the statement of claim demonstrate that the claim ought to have been discoverable by the plaintiff or other proposed class members with diligence. In particular, the defendants note that the statement of claim incorporates a term from the standard-form listing agreement between a seller and the seller’s brokerage. That term authorizes the seller’s brokerage to pay the buyer’s brokerage a commission based on the sale price of the property, and to make payment out of the commission that the seller pays to the seller’s brokerage: Statement of Claim at para. 98.
[220] The only plaintiff currently before this Court is Mr. Sunderland. He sold his home—allegedly the cause of his damages—in August 2020, and the statement of claim was filed less than one year later. Accordingly, it is neither plain nor obvious that this action insofar as Mr. Sunderland is concerned should be time-barred, and this ground of appeal cannot succeed.
[221] For other proposed class members, while this issue was not strictly before the motion judge, we find no error in the conclusion that the limitations period could not be adjudicated in the circumstances. As the motion judge correctly noted, discoverability is heavily dependent on findings of fact pertaining to individual litigants and evidence may be relevant: see, e.g., Grant Thornton at para. 44; Fehr v. Sun Life Assurance Company of Canada, 2018 ONCA 718 at para. 169; Kaynes v. BP p.l.c., 2021 ONCA 36 at para. 56 [Kaynes 2021]; Beaudoin Estate v. Campbellford Memorial Hospital, 2021 ONCA 57 at paras. 31-39. A limitation defence is not generally decided before a pleading has been filed raising the issue: Eli Lilly and Co. v. Apotex Inc., 2002 FCT 1007 at para. 27; see also Federal Courts Rules, r. 183(c)(i) (requiring pleading in a defence any matter of fact that might defeat a claim). Pleading a limitation defence allows a plaintiff to reply with facts supporting a position that the action was filed in time: Kibale v. R. (1990), 123 N.R. 153, 1990 CarswellNat 227 (F.C.A.); Metropolitan Toronto Condominium Corporation No. 1352 v. Newport Beach Development Inc., 2012 ONCA 850 at paras. 114-16.
[222] It may be possible to adjudicate a limitations issue on a motion to strike where there are no facts in dispute, such as where a plaintiff’s pleadings establish that the plaintiff discovered the claim out of time or where the limitation period is not subject to the rule of discoverability: see Kaynes 2021 at paras. 81-84; Kaynes v. BP, p.l.c., 2018 ONCA 337 at paras. 13-15. That was not the case here.
[223] Further, the motion judge did not err in concluding that based on the limited pleaded facts in the statement of claim, it is not plain or obvious that class members had sufficient knowledge to make the claim discoverable as of April 1, 2019.
[224] Class members may have known, by virtue of the listing agreement with their brokerage, that commission would be paid to the buyer’s brokerage out of the sale proceeds. However, that does not make it plain or obvious that class members were aware or ought to have been aware of the alleged agreement or arrangement, mediated by the TRREB and CREA rules, which is at the core of the pleaded paragraph 45(1)(a) offence. It is also not plain or obvious, based only on the facts pleaded, that class members were put on inquiry of the claim and failed to exercise reasonable diligence: Grant Thornton at para. 44; Canada (Attorney General) v. Utah, 2020 FCA 224 at para. 31, leave to appeal ref’d 2021 CanLII 52017.
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