This issue was considered in Webster v. Almore Trading (thanks to Ontario Civil Procedure blog).
Almore terminated Webster’s employment on or about July 27, 2006. Webster commenced an action for wrongful dismissal against the defendants on August 6, 2008. The action was subject to a two-year limitation period, pursuant to section 4 of the Limitations Act, 2002. The employer brought a motion for summary judgment arguing that there was no genuine issue for trial and that the action should be dismissed.
Webster argued that the discoverability principle in the Act applied.
Discovery
5. (1) A claim is discovered on the earlier of,
(a) the day on which the person with the claim first knew,
(i) that the injury, loss or damage had occurred,
(ii) that the injury, loss or damage was caused by or contributed to by an act or omission,
(iii) that the act or omission was that of the person against whom the claim is made, and
(iv) that, having regard to the nature of the injury, loss or damage, a proceeding would be an appropriate means to seek to remedy it; and
(b) the day on which a reasonable person with the abilities and in the circumstances of the person with the claim first ought to have known of the matters referred to in clause (a).
Presumption
(2) A person with a claim shall be presumed to have known of the matters referred to in clause (1) (a) on the day the act or omission on which the claim is based took place, unless the contrary is proved.
Mr. Justice Pitt stated:
Discoverability is largely a question of fact that hinges on the circumstances of the case as to when the plaintiff actually or ought to have found out about the material facts to ground a cause of action. In Alexis v. Darnley, 2009 ONCA 847 (CanLII), 2009 ONCA 847, 2009 CarswellOnt 7528 (C.A.), the Court of Appeal stated at para. 12 that “because discoverability is a factual analysis, it will often be inappropriate to dispose of the issue on a motion for summary judgment.”
Fair enough and then the other shoe drops:
Wrongful dismissal, in my view, raises a particularly difficult issue in the limitation context since it is not a dismissal per se that is actionable but rather dismissal without reasonable notice or salary in lieu of such notice, that is actionable. Accordingly, the limitation period for an action for wrongful dismissal does not necessarily run from the date of actual dismissal. It is activated when the cause of action is discovered – that is, the date that the terminated employee knew or ought to have known that he was discharged without cause and without notice or pay in lieu of notice and that a proceeding would be an appropriate way to get redress. The date of discovery may be later than the date of dismissal. [Emphasis added]
The court refused to grant the summary judgment motion since "the date on which Mr. Webster discovered his claim is a genuine issue requiring trial".
