One of the first tasks in any potential litigation matter is to identify the applicable limitation period. Generally, since June 1, 2013, BC’s Limitation Act, S.B.C. 2012, c. 13 (the “Limitation Act”) provides that potential claims are governed by a two year limitation period.
Under s. 8 of the Limitation Act, this two year limitation period begins to run from the first day on which a person knew or reasonably ought to have known all of the following:
- that injury, loss or damage had occurred;
- that the injury, loss or damage was caused by or contributed to by an act or omission;
- that the act or omission was that of the person against whom the claim is or may be made;
- that, having regard to the nature of the injury, loss or damage, a court proceeding would be an appropriate means to seek to remedy the injury, loss or damage.
There is a large body of case law detailing when the Courts have found that each of the discoverability elements have been satisfied and there are specific discoverability rules for particular types of claims. The limitation period also does not begin to run right away for minors or persons under disabilities. However, these issues are beyond the scope of this paper.
Put briefly, if a party is not under a disability and doesn’t bring its claim within two years of knowing it might have one, it potentially loses the right to make a claim forever.
The primary way in which the running of limitation periods may be extended is through circumstances which trigger s. 24 of the Limitation Act. S. 24 provides that an acknowledgment of or payment towards a debt or liability made before the expiration of the limitation period resets the limitation period.
Importantly, s. 24 requires a written acknowledgment to be in writing and to be either signed by hand or by electronic signature within the meaning of the Electronic Transactions Act, S.B.C. 2001, c. 10 (the “ETA”). Under the prior version of the Limitation Act, there was no provision for signatures being electronic. Presently, there is no prescribed form for electronic signatures and there is little judicial clarification as to what constitutes an electronic signature for the purposes of the Limitation Act.
S. 1 of the ETA defines an electronic signature as “…in electronic form that a person has created or adopted in order to sign a record and that is in, attached to or associated with the record.”
In a case concerning the Labour Relations Code1 the Labour Relations Board found that a union using Adobe’s E-sign program where participants would enter their nature, signature and date in an electronic form were electronic signatures.
In an unreported decision2, the Court found that an email that was concluded with the equivalent of a goodbye and a nickname did not satisfy the requirements of s. 24 of the Limitation Act.
Presently the only reported court decision in BC concerning when emails satisfy the requirements of s. 24 of the Limitation Act and the definition of electronic signature from s. 1 of the ETA is Johal v Nordio, 2017 BCSC 1129 (CanLII).
In Johal, the debtor argued that attaching his name to the bottom of an email was insufficient to meet the requirements of the ETA and that something akin to a digital signature was required. The email in question concluded with the debtor’s name, his position and contact information. The Court noted that the font used for the sender’s name was enlarged.
The Court rejected the debtor’s arguments and found that the legislation’s focus is on whether the sender created a signature to identify him or herself as the composer and sender. The Court noted the following four requirements adopted in a Saskatchewan decision for electronic signatures in emails:
- the presence of some type of information on the emails;
- such information may be in electronic form;
- the information must have been “created or adopted [by the person] in order to sign a document”; and
- the information must be “attached to or associated with the document”.
It is notable that the signature in question in Johal appeared to be the sort that is standard and automatically generated when the sender opened an e-mail window. As such, the signature would likely have required no input by the sender to be included in his email other than to have originally set up the automatic signature line.
There is no substantial analysis in Johal as to why the signature block in the email in question satisfied s. 24 of the Limitation Act and s. 1 of the ETA, but the case raises the argument that any e-mail including the sender’s name in a signature line, if it contains an acknowledgement of a debt or liability before the expiration of the applicable limitation period, may serve to extend that limitation period for another two years after the date of the e-mail.
Potential debtors and defendants should proceed cautiously when exchanging emails with potential creditors and claimants knowing that such emails may extend potential limitation periods. Conversely, while the most prudent course of action remains for potential creditors and claimants to commence their claims early to avoid any limitation concerns, potential creditors and claimants may avoid their claim being statute barred through email acknowledgements of debts and/or liabilities by potential debtors or defendants.
This area of law continues to evolve and, as such, it is critical for parties to a potential dispute to preserve all communications between them. Both sides to a dispute have an interest in resolving any limitations defences early and before much effort (or expense) is spent on the issue. As such, if readers retain legal counsel, it is essential that they provide their counsel with all documents they may have in relation to their dispute, especially if there are limitations concerns.
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1Working Enterprises Consulting & Benefits Services Ltd v United Food and Commercial Workers International Union, Local 1518, 2016 CanLII 29625 (BC LRB)
2Klym v. EIFS ARMOUR Wall Systems Inc., 2017 BCSC 283 (22/Feb/2017)