Promissory note and limitation period

Below are proposed amendments to the Limitations Act to deal with the problem created by recent caselaw regarding interpretation of the Act as it relates to demand promissory notes. Please note it is not law yet.

Schedule l
Limitations Act, 2002

1. Section 5 of the Limitations Act, 2002 is amended by adding the following subsections:
Demand obligations

(3) For the purposes of subclause (1) (a) (i), the day on which injury, loss or damage occurs in relation to a demand obligation is the first day on which there is a failure to perform the obligation, once a demand for the performance is made.
Same

(4) Subsection (3) applies in respect of every demand obligation created on or after January 1, 2004.

2. (1) Clause 15 (6) (c) of the Act is repealed and the following substituted:
(c) in the case of an act or omission in respect of a demand obligation, the first day on which there is a failure to perform the obligation, once a demand for the performance is made.

(2) Section 15 of the Act is amended by adding the following subsection:
Application, demand obligations
(7) Clause (6) (c) applies in respect of every demand obligation created on or after January 1, 2004.
3. Subclause 19 (1) (b) (i) of the Act is amended by striking out "the day this Act comes into force" and substituting "January 1, 2004".

4. (1) Subsections 22 (3), (4) and (5) of the Act are amended by striking out "the effective date" wherever it appears and substituting in each case "October 19, 2006".

(2) The definition of "effective date" in subsection 22 (6) of the Act is repealed.
5. (1) The definition of "effective date" in subsection 24 (1) of the Act is repealed.

(2) The definition of "former limitation period" in subsection 24 (1) of the Act is amended by striking out "the coming into force of this Act" at the end and substituting "January 1, 2004".

(3) The following provisions of section 24 of the Act are amended by striking out "the effective date" wherever it appears and substituting in each case "January 1, 2004":
1. Subsection 24 (3).
2. Paragraph 2 of subsection 24 (5).
3. Subsection 24 (6), in the portion before paragraph 1.
4. Paragraph 2 of subsection 24 (6).
5. Subsection 24 (7).

(4) Subsection 24 (2) of the Act is amended by striking out the first instance of "the effective date" and substituting "January 1, 2004" and by striking out the second instance of "the effective date" and substituting "that date".

(5) Subsection 24 (4) of the Act is amended by striking out the first instance of "the effective date" and substituting "January 1, 2004" and by striking out the second instance of "the effective date" and substituting "that date".

(6) Subsection 24 (5) of the Act is amended by striking out the first instance of "the effective date" in the portion before paragraph 1 and substituting "January 1, 2004" and by striking out the second instance of "the effective date" in the portion before paragraph 1 and substituting "that date".

(7) Paragraph 1 of subsection 24 (5) of the Act is amended by striking out the first instance of "the effective date" and substituting "January 1, 2004" and by striking out the second instance of "the effective date" and substituting "that date".

(8) Paragraph 1 of subsection 24 (6) of the Act is amended by striking out the first instance of "the effective date" and substituting "January 1, 2004" and by striking out the second instance of "the effective date" and substituting "that date".
(9) Section 24 of the Act is amended by adding the following subsection:
Claims re payments alleged to be ultra vires
(7.1) For the purposes of this section, clause 45 (1) (g) of the Limitations Act , as it read immediately before its repeal, applies to a claim respecting amounts paid to the Crown or to another public authority for which it is alleged that no valid legal authority existed at the time of payment.
(10) Subsection 24 (8) of the Act is amended by striking out "the day this Act comes into force" at the end and substituting "January 1, 2004".
Commencement

6. (1) Subject to subsection (2), this Schedule comes into force on the day the Budget Measures and Interim Appropriation Act, 2008 (No. 2) receives Royal Assent.
Same
(2) Subsection 5 (9) is deemed to have come into force on October 22, 2008.