If you want to pursue a legal dispute, a lawyer may be able to get results without even setting foot in a court room, particularly if you retain counsel with plenty of time before the deadline for commencing a lawsuit expires.
A lawyer may be able to resolve your claim entirely out of court by negotiating a settlement. Often this process starts with your lawyer sending a demand letter to the offending party or parties, advising of the grounds of your claim and what compensation or other remedy you are willing to accept to avoid going to court. From there, the parties negotiate, typically through counsel, to resolve the dispute.
Negotiating can be a long process, particularly if all of the parties are represented by busy lawyers.
What if you are still negotiating when the deadline arrives for filing a lawsuit? As noted in our previous blog posts, Time Limits to Sue in Ontario, and Commencing a lawsuit in Ontario, there is a basic 2-year limitation period and an ultimate 15-year limitation period. Most lawsuits in Ontario need to be filed in compliance with these deadlines.
If the parties believe that they are close to reaching a settlement, or want to negotiate out of court longer, will it always be necessary to start a lawsuit before the applicable limitation period expires?
Luckily, a limitation period can be extended under certain conditions. If the parties are already in settlement discussions, or want to delay commencing a lawsuit to negotiate a settlement, this is permitted under section 11 of Ontario’s Limitations Act, 2002. However, all of the parties have to agree to “have an independent third party resolve the claim or assist them in resolving it.” Such an agreement ought to be recorded in writing.
If the parties are unable to resolve the dispute between themselves, the limitation period for commencing a lawsuit will begin to run again if any of the parties terminate the agreement, withdraws from the agreement, or the resolution process entered by the parties is terminated.
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