Cassels Brock’s Product Liability litigation team was recently successful in defeating a defendant’s motion to have a client, Bendix Commercial Vehicle Systems LLC, added as a third party to an action in the Ontario Superior Court of Justice (Parvin v. Richardson, 2015 ONSC 1778.)

Background to the Action

The action arises from a 2008 motor vehicle accident in which the plaintiffs’ vehicle was allegedly rear-ended by a mobile crane unit manufactured by Grove U.S. LLC and owned and operated by Venetor Crane Ltd. (“Venetor”). Venetor alleges that Bendix CVS manufactured the brake assembly in the mobile crane.

Venetor’s Attempt to Issue a Third Party Claim

On December 19, 2014, Venetor brought a motion seeking leave to issue a Third Party Claim against Bendix CVS. Interestingly, had Venetor received consent from the plaintiffs, leave would not have been required and the motion would have been unnecessary. The plaintiffs, however, took no position.

Bendix CVS opposed the motion on the basis that Venetor’s claim against Bendix CVS was clearly discoverable more than two years prior to the motion being brought. This was established in discovery transcripts and was admitted by Venetor.

Venetor argued that it should be permitted to issue the claim against Bendix CVS since it had advised Bendix CVS of its intention to bring a Third Party Claim prior to the expiry of the applicable limitation period and, in any event, the Rules of Civil Procedure only provide for the Court to consider whether there will be prejudice to the plaintiffs in determining whether to deny leave. 
The Court, on the motion, disagreed, finding that it had no discretion to allow a claim to be issued where a limitation period has expired and the party seeking to advance the claim had not met its burden of demonstrating why the limitation period should not apply. This clarifies earlier court rulings which have found that the Limitations Act trumps the Rules of Civil Procedure. To our knowledge, this is the first case where a Third Party Claim was denied leave to issue despite a finding of no prejudice to the plaintiffs. The Court denied Venetor’s motion and awarded costs to Bendix CVS.

Key Take-Away Principles

The decision is heartening to product manufacturers, who frequently face attempts to be brought into complex product liability actions late in the game and beyond the applicable limitation period. It also clarifies that it is not necessary to wait for such a claim to be issued and seek summary judgment. Rather, where a proposed Third Party Claim is statute-barred on its face it can be opposed and defeated at an early stage by the proposed third party.

Bendix CVS was represented on the motion by Peter Henein and Chris Horkins with assistance from Stefanie Holland.The decision can be found here.