The plaintiff sold unrefined gold to the defendant (“24 Gold”) during the 24 months ending in mid-2012. After an audit, CRA assessed the plaintiff on June 1, 2015 for its failure to charge and remit HST of $1.6 million on such sales, which CRA collected. The plaintiff invoiced 24 Gold for the $1.6 million on May 31, 2015, and then brought this motion for summary judgment, in December 2016 seeking payment of that amount.
Diamond J found that the plaintiff’s claim was not statute-barred by reason of the Limitations Act 2002, stating (at paras 22 and 23):
24 Gold submits that … “at the very latest, the plaintiff ought to have issued a Statement of Claim by the summer of the year 2012” (i.e. at the conclusion of the series of its transactions with 24 Gold).
Section 5(1)(a)(iv) of the Limitations Act 2002 requires a person to have known that, having regard to the nature of the person’s loss, a legal proceeding would be an appropriate means to seek to remedy that loss. … Only when the plaintiff ended up paying the HST itself did it acquire a cause of action for the debt now due by 24 Gold. While I do not condone the delay on the part of the plaintiff to properly invoice the subject transactions, the bottom line is that the plaintiff could not commence a legal proceeding until the CRA audit resulted in the payment by the plaintiff of the outstanding HST. … As such, the limitation period did not commence until, at the earliest, June 1, 2015.
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