Understanding the short prescription period that applies in municipal mattersMay 18th, 2016
More complex then it appears.
When the time comes to institute legal proceedings against a municipality, the short prescription period that applies in such matters is often forgotten or misunderstood. This article is intended as a refresher on the applicable rules and an update on their interpretation in the jurisprudence, to keep you from losing any rights or omitting any arguments to back up your legal assertions, whichever side you’re on!
These are sections 1112.1 of the Municipal Code (hereinafter "CM") and 585 of the Cities and Towns Act (hereinafter "CTA"), which provide the applicable rules. These will be summarized in our words below.
When an action must be instituted against a municipality, under Section 1112.1 MC, notice must be given by any person who wishes to institute an action in damages within sixty (60) days of the cause of action. This time limit is fifteen (15) days in the case of a town under paragraphs 1 and 2 of Section 585 CTA. The concept of notice is not addressed in detail in this article. Let us simply mention that the jurisprudence has established that the notice must be sent within the prescribed period (whether suing a municipality or a town), and this as of knowledge of the facts that gave rise to the right of action. Indeed, you must not wait to be able to specifically identify the exact nature of the wrongful act before sending the notice. Moreover, lack of notice is fatal to a suit against a municipality since Section 1112.1 MC, unlike Section 585 (4) CTA, does not allow for any waiver of the default to give timely notice.
In addition, an action in damages must be instituted within six (6) months of the date the cause of action arose, but not until a period of fifteen (15) days has elapsed since the municipality or town received the notice.
Section 1112.1 MC applies to all extra-contractual claims except, however, claims for bodily injury. Indeed, the Supreme Court ruled in Doré c. Verdun that Article 2930 C.C.Q. prevailed over Section 585 CTA (the thrust of which is basically the same as Section 1112.1 MC) and that the six-month prescription could therefore not be raised in cases of bodily injury caused to another. The case of Chauvette c. St-Albert (Municipalité de) confirmed that this exception also applies to municipalities.
In Entreprise TGC Inc. c. Val-Morin (Municipalité de), the Superior Court held that Section 1112.1 MC does not apply to contractual claims against a municipality. The same principle applies to towns and was affirmed in Longueuil (Ville de) c. Carquest Canada ltée. Therefore, this means that the prescription that applies in contractual cases, whether against a town or a municipality, will be the general three-year prescription period.
Starting point for calculating prescription: The concept of “cause of action”
The starting point for calculating such six-month prescription is therefore the cause of action, quite obviously. But what does this term mean? In Chauvette c. St-Albert (Municipalité de) cited above, the Superior Court writes as follows concerning cause of action.
Meanwhile, in Ross c. Investissements Le Gris Inc., the Superior Court addressed the concept of the appearance of the injury to explain the starting point for the calculation of prescription:
It is also interesting to underline the case of Jean c. St-Jean-de-l’Île d’Orléans (Municipalité de) where the Superior Court was called upon to rule on a motion for dismissal on the ground alleged of prescription. The Superior Court, referring to the decision in Foyer du sport inc. c. La Coop fédérée, pointed out that there is a difference in the application of the prescription starting point where the injury appears gradually or progressively or where the injury manifests continuously and uninterruptedly because the fault extends over a period of time:
In summary, one must keep in mind that, except in cases of bodily injury or contractual matters, the applicable prescription period will be six (6) months. Notice is also essential, although that statement may be qualified in the case of a town. The notice must be given within sixty (60) days in the case of a municipality, but within fifteen (15) days in the case of a town. And in either case, you cannot institute your action until a period of fifteen (15) days has elapsed since the notice was received. Finally, these time limits must be calculated from the cause of action, which can be summarized as the point in time where the injury becomes appreciably manifest. However, there is a difference depending on whether it is a case of gradual or progressive injury or a case of continuous and uninterrupted injury. In the latter case, the fault also extends over a period of time, and prescription will therefore start to run as of each wrongful act.
These are the basic principles you should remember, whether you are representing a municipality defending itself against an action or if you wish to bring an action against a municipality to ensure that you are properly asserting the rights of the party you represent. However, do not limit yourself to these basic principles for, as in all things, the jurisprudence seems to want to make certain exceptions. Indeed, just recently, the Court of Appeal decided in Ste-Anne-de-Beaupré (Ville de) c. Cloutier that the ordinary three-year prescription applied in an action for aggravation of the natural water runoff servitude on the basis that it was a neighbourhood dispute. Unfortunately, it came to this conclusion without extensively clarifying the reasons. It will therefore be interesting to see if this decision will become a precedent.