IMAX Corporation, et al. v. Marvin Neil Silver, et al.

(Ontario) (Civil) (By Leave)




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Limitation of actions - Legislation - Interpretation - Civil procedure - Class actions - Securities - Statutory claim - Statement of claim in proposed class action indicating that plaintiffs will seek order granting leave to assert statutory cause of action for misrepresentation provided by s. 138.3 of Part XXIII.1 of Ontario Securities Act - Leave not obtained prior to expiry of three-year limitation period set out in s. 138.14 of Securities Act - Whether the limitation period was suspended by the filing of a statement of claim pleading only common law claims while giving notice that the plaintiffs intended to assert a s. 138.3 cause of action - If not, whether the expiry of the limitation period can be cured by an order nunc pro tunc - Securities Act, R.S.O. 1990, c. S.5, ss. 138.3, 138.8, 138.14 - Class Proceedings Act, 1992, S.O. 1992, c. 6, s. 28.

In this class action proceeding, the representative plaintiffs are claiming damages under Part XXIII.1 of the Ontario Securities Act (“OSA”) for misrepresentations alleged to have been made in respect of shares trading in the secondary market. In addition to common law negligent misrepresentation claims, they make a claim based on the new statutory cause of action found at s. 138.3 of the OSA, which can only be commenced with leave of the court and is subject to a three-year limitation period, found at s. 138.14(1) of the OSA. The class action was commenced within the three-year limitation period and a motion for leave to commence the statutory claim was brought, but leave was granted after the expiry of the limitation period. On motion by the defendants to dismiss the statutory claim as being time-barred in view of the Ontario Court of Appeal’s 2012 decision in Sharma v. Timminco, 2012 ONCA 107, the motions judge ordered that leave to commence the action applied nunc pro tunc within the limitation period. On appeal by the defendants, a five-judge panel of the Court of Appeal concluded that the decision in Timminco should be overturned, and therefore that the action was not statute-barred.

Lower Court Rulings

August 27, 2012
Ontario Superior Court of Justice

CV-06-3257-00, 2012 ONSC 4881
Motion by applicants for an order dismissing the respondents’ claims pursuant to s. 138.3 of the Securities Act on the ground that they are barred by s. 138.14 dismissed; motion by respondents for an order granting leave nunc pro tunc to commence an action under s. 138.3 allowed
February 3, 2014
Court of Appeal for Ontario

C55982, 2014 ONCA 90
Appeal by applicants dismissed: the respondents’ claims under Part XXIII.1 of the Securities Act are not statute-barred