No reasonable excuse: Ontario Court of Appeal breathes life back into municipal notice requirements

7 minute read
24 January 2022

A recent decision from the Ontario Court of Appeal affirms that summary dismissal of an action against a municipality is appropriate where the plaintiff has failed to provide timely notice without reasonable excuse.

In Psaila v Kapsalis,[1] the Ontario Court of Appeal considered an appeal from a decision granting summary judgment and dismissing the plaintiff's action against the City of Toronto for failure to provide notice as required by the City of Toronto Act, 2006.[2] The Court of Appeal dismissed the appeal, finding that the motion judge's decision was reasonable and entitled to deference.

The summary judgment motion

In the decision under appeal, Justice Vella had considered a summary judgment motion brought by the defendant City of Toronto to dismiss the action against it.[3] The action had arisen from a motor vehicle accident involving the plaintiff and another driver in March 2015.

The litigation had been well underway before the City of Toronto was named as a party – both the plaintiff and defendant driver had been examined for discovery in early 2017, and the defendants had served an expert engineering accident reconstruction report blaming the plaintiff for the accident (the "Wilson Report") in February 2018. The plaintiff retained a responding expert engineer in late March, who advised plaintiff's counsel to put the City on notice "in an abundance of caution," suspecting there may be an intersection design issue and "potentially an urgency" to put the City on notice. The City was put on notice on April 2, 2018, and added as a defendant to the action by Order dated March 29, 2019, without prejudice to its rights to assert any defences, including those based on expiry of limitation period or notice period.

Section 42(6) of the City of Toronto Act, 2006, provides that no action shall be brought for recovery of damages against the City unless notice is provided to the city clerk within 10 days.[4] However, section 42(8) provides that "[f]ailure to give notice or insufficiency of the notice is not a bar to the action if a judge finds that there is reasonable excuse for the want or the insufficiency of the notice and that the City is not prejudiced in its defence."[5]

Justice Vella concluded that, even using a "broad and liberal interpretation" of "reasonable excuse," the plaintiff had knowledge of sufficient facts to underpin a potential claim based on design defects with the intersection even prior to receiving the Wilson Report. She also found that, in the alternative, the facts combined with the identification of the visibility issue in the Wilson Report should reasonably have resulted in the issuance of notice to the City within 10 days from the receipt of the Wilson Report in February 2018 at the very latest.

The appeal

The plaintiff appealed, arguing, inter alia, that Justice Vella had made a palpable and overriding error in misapprehending the expert opinion in the Wilson Report. The Court of Appeal disagreed.

The Court of Appeal considered the facts that were available to the appellant plaintiff and found that Justice Vella's conclusion that the facts should have led the plaintiff to investigate and put the City on notice was reasonable:

[6] The appellant knew the location of the accident, knew of the City's responsibility for designing and maintaining it, and knew that the defendants were blaming him for failing to avoid the collision. As the motion judge noted, the defendants' allegation was premised on the assumption that the design and layout of the intersection permitted a reasonably prudent driver to have seen the defendants' vehicle and take defensive action to avoid a collision. Her conclusion that this should have led the appellants to investigate the intersection and put the City on notice of a potential claim is reasonable. We note that the motion judge found, in the alternative, that at the very latest the appellant should have provided the City with notice within 10 days of receiving the Wilkinson Report [sic], but did so only two months after receiving it.

The Court of Appeal upheld Justice Vella's conclusion that the appellant had failed to establish a reasonable excuse for its delay in providing notice, noting that it was reasonable and entitled to deference.

Looking forward

This decision re-affirms that a potential plaintiff must have a reasonable excuse for failing to provide timely notice under the City of Toronto Act, 2006, and indicates that actions may be dismissed for failure to provide notice if a plaintiff has sufficient facts to indicate notice should be given and fails to do so.  

This decision also provides useful guidance to other municipalities in Ontario, subject to the Municipal Act, 2001, which contains similar provisions requiring notice within 10 days, or reasonable excuse for failure to do so.[6]

Should you have any specific questions about this article or would like to discuss it further, you can contact the authors or a member of our Insurance & Professional Liability Group.

[2] SO 2006, c 11, Sched A.

[3] Psaila v Kapsalis and City of Toronto, 2021 ONSC 1308.

[4] City of Toronto Act, 2006, SO 2006, c 11, Sched A, s 42(6).

[5] City of Toronto Act, 2006, SO 2006, c 11, Sched A, s 42(8).

[6] Municipal Act, 2001, SO 2001, c 25, ss 44(10) and (12).

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