



COURT OF APPEAL FOR ONTARIO

CITATION: Kyle v. Atwill, 2020 ONCA 476

DATE: 20200723

DOCKET: C67203

Feldman, Brown and Zarnett JJ.A.

BETWEEN

Fleming Kyle

Applicant

(Appellant)

and

Elizabeth Gail Atwill

Respondent

(Respondent)

Aaron Franks and Rhea Kamin, for the
    appellant

Carolyn Shelley and Silvia Cioci, for
    the respondent

Heard: January 20, 2020

On appeal from the order of Justice Timothy
    Minnema of the Superior Court of Justice, dated June 13, 2019, with reasons reported
    at 2019 ONSC 3707, 25 R.F.L. (8th) 195.

Feldman J.A.:

A.

Overview

[1]

The issue on this appeal is whether a plea asking
    the court to set aside a marriage contract is subject to a limitation period,
    and if so, what is the period?

[2]

The parties entered into a prenuptial agreement
    (the marriage contract) immediately before their marriage. The contract waived
    any entitlement to spousal support and provided that the parties would be
    separate as to property. After seven years of marriage, the parties separated.

[3]

Eventually, the husband brought family law proceedings
    claiming equalization of net family property and spousal support. The wife
    defended by relying on the marriage contract as a complete answer. He replied
    by asking the court to set aside or rescind the marriage contract on the basis that
    he had signed it without financial disclosure, without legal advice, under
    duress, and under a clear power imbalance.

[4]

Although the husband commenced the proceeding
    within the six-year limitation period for equalization claims under the
Family
    Law Act
, R.S.O. 1990, c. F.3, s. 7(3)(b), more than two years had elapsed since
    the parties separated. The wifes position was that the request to rescind the marriage
    contract was out of time. On summary judgment, the motion judge found that rescission
    of a marriage contract constitutes a claim under the
Limitations Act
,
    2002
, S.O. 2002, c. 24, Sched. B., that claim is subject to the two-year limitation
    period in s. 4 of the Act, and the husband discovered his claim roughly two
    months after separation. The motion judge therefore found the claim to be
    time-barred.

[5]

For the reasons that follow, I would allow the
    appeal. The husbands plea for rescission of the marriage contract is a
    proceeding for a declaration where no consequential relief is sought and
    therefore, under s. 16(1)(a) of the
Limitations Act
, no limitation
    period applies to that pleading. The husbands claim for equalization is
    subject to the six-year period set out in s. 7(3)(b) of the
Family Law Act
,
    and his claim for spousal support is not subject to a limitation period,
    pursuant to s. 16(1)(c) of the
Limitations Act
. Neither is time-barred
    and the action may proceed.

B.

Facts

[6]

The parties married in July 2005 after
    cohabiting for one year.

[7]

One week before the wedding, they signed the
    marriage contract based on a template for prenuptial agreements that the wife
    had found on the internet. Although the contract states that each party has
    retained their own lawyer and has received independent legal advice, neither the
    husband nor the wife retained or consulted a lawyer. Similarly, the contract
    states that the parties exchanged financial disclosure, but no formal exchange took
    place.

[8]

The agreement contains provisions setting out
    the parties intent to keep their assets separate, to bar any property claims
    following separation, and to waive any future rights to spousal support.

[9]

When the parties separated in August 2012, the
    husband moved out of the matrimonial home, which was owned by the wife.

[10]

The parties retained counsel and began
    negotiations until the husband abandoned the negotiations in the spring of 2013
    because his existing mental illness had worsened. In the spring of 2015, the
    husbands lawyer contacted the wifes lawyer to indicate that the husband was
    preparing to initiate a court proceeding.

[11]

However, no proceeding was commenced until
    August 24, 2017, when the husband brought an application for spousal support,
    equalization of net family property, and yearly financial disclosure. The
    husband did not explicitly seek to set aside the marriage contract in his original
    pleading, but his statement of facts referred to the contract and stated that
    he had signed it with no legal advice, no financial disclosure, and under
    duress.

[12]

The wife filed an answer, relying primarily on
    the marriage contract as a defence to the husbands claims. She subsequently
    amended her answer to argue that the husbands claim to set aside the marriage
    contract was statute-barred by s. 4 of the
Limitations Act
.

[13]

Following the amendment, the husband filed a reply
    contesting the applicability of the
Limitations Act
and stating that
    the marriage contract should be deemed invalid because he signed it without
    financial disclosure, without legal advice, under duress and with a clear power
    imbalance.

C.

Decision of the Motion Judge

[14]

The issue whether the husbands request to set
    aside the marriage contract was statute-barred was heard four weeks prior to
    the scheduled trial date, as a summary judgment motion. The two issues on the
    motion were whether a trial was required to decide: first, whether the two-year
    limitation period in s. 4 of the
Limitations Act
applies to an
    application to set aside a marriage contract under s. 56(4) of the
Family
    Law Act
; and second, if so, whether the husband had brought his
    application in time.

[15]

Dealing with the first issue, the motion judge
    found that the request to set aside the marriage contract constituted a claim to
    remedy an injury, loss or damage within the meaning of s. 4 of the
Limitations
    Act
. The husbands loss was the extinguishment of his rights under the
Family
    Law Act
to equalization and spousal support by an allegedly improperly obtained
    marriage contract: at para. 27. Therefore, the two-year limitation period applied
    unless the
Limitations Act
provided otherwise.

[16]

The motion judge then considered whether a
    request to set aside a marriage contract comes within s. 16(1)(a) of the
Limitations
    Act
. That section provides that there is no limitation period for a
    proceeding for a declaration if no consequential relief is sought. The motion
    judge found that while the husband was seeking a declaration that the marriage
    contract was of no force or effect, s. 16(1)(a) was not engaged because he was
    also seeking the consequential relief of spousal support and equalization of
    net family property: at para. 31.

[17]

Having found that the two-year limitation period
    applied, the motion judge turned to the question of when the husband discovered
    his claim, using the criteria in s. 5 of the
Limitations Act
. He found
    that by October 17, 2012, when the husband told his social worker that the
    marriage contract had issues and that the wife was still relying on it, the husband
    knew that a court proceeding was appropriate: at para. 44.

[18]

The motion judge rejected the husbands further
    argument that he was not legally able to discover what limitation period
    applied to a proceeding to rescind a marriage contract under s. 56(4) of the
Family
    Law Act
because there was no previous case law on the issue: at para. 46. The
    motion judge also considered whether the husbands mental health issues had
    made him incapable of commencing the proceeding until he did so more than two
    years after October 17, 2012, but the motion judge found no evidence in the
    record to make incapacity a genuine issue for trial: at para. 50.

[19]

Accordingly, the motion judge found that he
    could decide on the record before him on summary judgment that the husbands request
    for rescission of the marriage contract was out of time, as more than two years
    had elapsed since he discovered his claim: at para. 51.

D.

Issues on Appeal

[20]

The sole issue on the appeal is whether the
    motion judge erred by dismissing the husbands claims for equalization and
    spousal support on summary judgment because his plea to rescind the marriage
    contract was statute-barred. As the
Family Law Act
provides no
    limitation period for an application to set aside a marriage contract, the
    appeal requires this court to decide which of the
Limitations Act
s
    provisions governs the request to set aside the marriage contract under s.
    56(4) of the

Family Law Act
. The question is thus whether the
    application to set aside the marriage contract is subject to no limitation
    period because it is a proceeding under s. 16(1)(a) of the
Limitations Act
for a declaration where no consequential relief is sought, or whether it is subject
    to the two-year limitation period and if so, when the loss or damage occurred and
    when the claim was discovered.
[1]


E.

Standard of Review

[21]

The parties agree that the standard of review on
    this appeal is correctness. Although the motion judge made a number of
    determinations of mixed fact and law in granting summary judgment, the issue
    under appeal is whether he erred in law by determining that the two-year
    limitation period under s. 4 of the
Limitations Act
applies to an
    application under s. 56(4) of the
Family Law Act
.

F.

Legislative Context

[22]

There are two Ontario statutes that govern
    limitations issues in family law matters: the
Limitations Act
and the
Family
    Law Act
. The
Limitations Act
sets out the general limitation
    periods for actions in Ontario as well as the applicability of limitation
    periods set out in some other acts, including the
Family Law Act
.

(1)

The Limitations Framework under the
Limitations
    Act


[23]

The
Limitations Act
provides the basic
    two-year limitation period for claims in Ontario, as well as the circumstances
    in which other limitation periods may apply.

[24]

The general limitation period is stated at s. 4:

4
Unless
    this Act provides otherwise, a proceeding shall not be commenced in respect of
    a claim after the second anniversary of the day on which the claim was
    discovered.

[25]

Claim is defined in s. 1:

1
In
    this Act, [] claim means a claim to remedy an injury, loss or damage that
    occurred as a result of an act or omission[.]

[26]

Section 5 sets out when a claim is discovered:

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).

(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.

[27]

Section 16(1) gives a list of proceedings for
    which there is no limitation period. Subsection 16(1)(a) provides that [t]here
    is no limitation period in respect of [] a proceeding for a declaration if no
    consequential relief is sought.

(2)

Limitation Periods for Equalization and for
    Spousal Support

[28]

In the family law context, the operation of the
Limitations
    Act

together

with the
Family Law Act

prescribes
    limitation periods that are, in most cases, considerably more generous than the
    two-year period set out in s. 4 of the
Limitations Act
, in recognition
    of the unique situation of spouses and families on the breakup of a marriage.

[29]

Section 19(1)(a) of the
Limitations Act
provides for the application of limitation periods contained in other acts. One
    such limitation period is s. 7(3) of the
Family Law Act
, which sets
    out three limitation periods for applications for equalization of net family
    property that may be brought under s. 5 of the
Family Law Act
. Section
    7(3) states:

7(3)
An
    application based on subsection 5 (1) or (2) shall not be brought after the
    earliest of,

(a)
two years after the day the
    marriage is terminated by divorce or judgment of nullity;

(b)
six years after the day the
    spouses separate and there is no reasonable prospect that they will resume
    cohabitation;

(c)
six months after the first
    spouses death.

[30]

Unlike with limitation periods contained in the
Limitations
    Act
, the court may extend limitation periods specifically provided in the
Family
    Law Act
under s. 2(8) of that Act,

in certain enumerated
    circumstances.

[31]

With respect to spousal support, the
Family
    Law Act
does not provide a limitation period for seeking an order for
    spousal support under s. 33(1) of that Act. The limitation issue is dealt with
    in s. 16(1)(c) of the
Limitations Act
,
which provides that
    there is no limitation period for bringing a proceeding to obtain support or to
    enforce a contract providing for support under the
Family Law Act
.

[32]

These special limitation periods account for the
    need to allow spouses more time to try to resolve their property issues without
    having to go to court, and the fact that a spouse or former spouses support
    needs can change over time and may be addressed whenever they do.

(3)

Limitation Period for Setting Aside a Domestic
    Contract

[33]

Persons who are married or intend to marry may
    agree regarding their rights and obligations during and after the marriage in a
    marriage contract, which is one form of domestic contract:
Family Law Act
,
    s. 52.

[34]

A domestic contract prevails over the Act unless
    the Act provides otherwise: s. 2(10). A number of provisions of the
Family
    Law Act
permit a court to set aside all or part of a marriage contract,
    two of which are relevant to this appeal.

[35]

First, in the context of an application for
    spousal support, s. 33(4) gives the court the power to set aside a provision in
    a marriage contract that waives or reduces the right to support in three
    enumerated situations, including where the provision results in unconscionable
    circumstances.

[36]

Second, s. 56(4) allows a court to set aside an
    entire marriage contract or any provision in it, on application. That provision
    states:

56(4)
A court may, on application, set aside a domestic contract or a
    provision in it,

(a)
if a party failed to disclose to
    the other significant assets, or significant debts or other liabilities,
    existing when the domestic contract was made;

(b)
if a party did not understand the
    nature or consequences of the domestic contract; or

(c)
otherwise in accordance with the
    law of contract.

[37]

There is no limitation period provided in the
Family
    Law Act
for setting aside all or part of a domestic contract under s.
    56(4), although that section specifically contemplates a court application for
    such relief. There is also no limitation provided for setting aside a spousal
    support provision of a marriage contract under s. 33(4), but that determination
    is made as part of a spousal support application for which there is no
    limitation period, as provided in s. 16(1)(c) of the
Limitations Act
.

[38]

Because the
Family Law Act
is silent as
    to the limitation period that applies to an application to set aside a marriage
    contract or a provision in it, one must look to the
Limitations Act
to
    determine which provisions of that Act, if any, apply. In this respect, I do
    not share my colleagues view that the provision establishing the limitation
    period for seeking equalization should be read to also apply to an application to
    set aside a marriage contract under s. 56(4) of the
Family Law Act
. The
    fact that the
Family Law Act
does not provide a limitation period for an
    application to set aside a marriage contract under s. 56(4) is, in my view, a
    clear legislative signal that the
Limitations Act
is to apply.

G.

Analysis

(1)

Preliminary Issue: Does it matter whether the
    request to set aside the marriage contract was part of the husbands original claim
    or part of his response to the wifes defence?

[39]

As a preliminary matter, I wish to address the husbands
    submission that because the question of setting aside the marriage contract only
    arose procedurally in the context of the wifes defence, no limitation applies.

[40]

I would reject this argument. Procedurally, the husband
    did not initiate a request to set aside the marriage contract until it was
    raised as a defence, whereupon he asked that the contract be set aside in a
    reply pleading. However, regardless of how the issue arose, in order for the husband
    to obtain an order under the
Family Law Act
for equalization or
    spousal support in contravention of the marriage contract he signed, he
    requires an order under s. 56(4) setting all or part of that marriage contract
    aside.
[2]
Otherwise, the court will enforce the contract:
Family Law Act
, s.
    2(10).

[41]

Therefore, the motion judge did not err by
    treating the issue as a request by the husband for relief, thereby engaging the
    limitation issue.

(2)

Section 16(1)(a) of the
Limitations Act

[42]

On questions of statutory interpretation such as
    those at issue in this appeal, a court must read the words of an act in their
    entire context and in their grammatical and ordinary sense harmoniously with
    the scheme of the act, the object of the act, and the intention of the
    legislature:
Bell ExpressVu Limited Partnership v. Rex
, 2002 SCC 42,
    [2002] 2 S.C.R. 559, at para. 26. Here, there are two statutes that work
    together to provide limitations in the family law context, and the court must
    interpret them applying the same principles.

[43]

Section 4 of the
Limitations Act
mandates
    the basic two-year limitation period for all claims unless the Act provides
    otherwise. As a result, if there is another provision that governs the limitation
    for the relevant proceeding, that provision prevails. Therefore, if s. 16(1)(a)
    applies, then there is no limitation period for bringing a proceeding to set
    aside a marriage contract under s. 56(4) of the
Family Law Act
.

[44]

In addressing the potential applicability of s.
    16(1)(a) of the
Limitations Act
to a proceeding under s. 56(4) of the
Family
    Law Act
, the motion judge agreed that the application to set aside the
    marriage contract is a proceeding for a declaration: at para. 31. The
    declaration is that the contract is of no force and effect and is set aside.
    However, the motion judge found that the husband was claiming consequential
    relief in the form of equalization and spousal support and for that reason, the
    proceeding did not come within s. 16(1)(a) for limitation purposes: at para.
    31.

[45]

I agree with the motion judge that the
    application to set aside the marriage contract is an application for a
    declaration. However, I do not agree that that application seeks consequential
    relief.

[46]

The current
Limitations Act

was
    the product of a lengthy process of law reform efforts over a number of years.
    In the early 1990s, the Limitations Act Consultation Group to the Attorney
    General made a series of recommendations that ultimately formed the basis for
    the current
Limitations Act
, including the provision setting out the limitation
    period for declarations: see
Recommendations for a New Limitations Act
(Toronto: Ministry of the Attorney General of Ontario, 1991). At p. 18, the
    Consultation Group gave its recommendation that there be no limitation period
    for a proceeding seeking a declaration:

Recommendation 2: Applicability and
    Exemptions from Limitations:



c) Exemption  Declarations

Declarations do not grant any judicial remedy.
    Therefore, since they impose no legal obligation on the defendant there is no
    justification for barring them. Moreover, there will be circumstances in which
    parties will wish to submit matters to court, such as interpretation of legal instruments
    like wills and contracts, without seeking a remedy from the court.

There is some concern that if there is no
    limitation period on seeking declarations the procedure may be used to circumvent
    limitation periods. Then, the declaration could be used in aid of non-judicial
    remedies. If evidence develops that there is abuse of the declaration power
    then this provision may have to be re-examined.

[47]

The Committees commentary explains that declarations
    would be exempt from any time limit because no consequential remedy would be
    ordered against another party. Professor Lazar Sarna explains the distinction
    between a declaratory and a remedial judgment as follows in his text,
The
    Law of Declaratory Judgments
, 4th ed. (Toronto: Thomson Reuters, 2016), at
    p. 54:

A distinction is made between a remedial
    judgment and a declaration. In those provinces where declaratory orders are
    excluded from limitations statutes or the purview of juries, the distinction is
    crucial. A remedial judgment carries within its own terms a solution for the
    cure of a dispute, be that an order to do or not to do, or more specifically,
    to pay, deliver over, seize, sell, dissolve, remove, or refrain. It is
    self-executing in the sense that the parties and the executing officer need no
    further direction or authorization than that contained in the judgment. A
    declaration confirms or denies the existence of a right, as if bearing witness
    to what has always been the legal relationship between the disputing parties.
    Put that way, it is an existential judgment that considers rights to be or not
    to be. An executing officer would be at a loss for guidance if called upon to
    execute the declaration because no remedial course is stated in the declaration.
    The parties are not even called upon to take the next step in accommodating the
    declaration: rather, their challenge is to consider immediate compliance, or
    new court proceedings to remedy a situation interpreted and clarified by the
    declaration. [Footnote omitted.]

[48]

This description of declaratory and remedial
    judgments is reflected in the jurisprudence of this court. A declaratory
    judgment is a formal statement by a court pronouncing upon the existence or
    non-existence of a legal state of affairs  it is restricted to a declaration
    of the parties rights and does not order any party to do anything

:
Starz
    (Re)
, 2015 ONCA 318, 125 O.R. (3d) 663, at para. 102; see also
Fehr v.
    Sun Life Assurance Company of Canada
, 2018 ONCA 718, 84 C.C.L.I. (5th)
    124, at para. 207;
Peikut v. Romoli
, 2020 ONCA 26, 55 E.T.R. (4th)
    166, at paras. 12-13.

[49]

As enacted, s. 16(1)(a) of the
Limitations
    Act
provides that there will be no limitation period for a proceeding for
    a declaration if no consequential relief is sought. As this is a limitations
    statute, as a matter of statutory interpretation, the question is: what is the
    meaning of consequential relief in this section, and what is the intent of
    limiting the circumstances when there will be no limitation period to when the
    request for a declaration does not also claim consequential relief?

[50]

To answer the question, one must be careful not
    to confuse procedure with substance in interpreting and applying s. 16(1)(a) of
    the
Limitations Act
. The
Limitations Act
is not concerned
    with procedural issues: the purpose and effect of its provisions is to govern
    the time limits for commencing actions and proceedings. Whether the parties
    have combined different claims or causes of action into one or more proceedings
    will not alter the time periods that govern. Put differently, different
    limitation periods may govern different claims in the same action.

[51]

The key, therefore, is not whether consequential
    relief in the form of a claim for a remedy against another party is sought
    procedurally in the same proceeding or in a subsequent proceeding. The key is
    whether the request for a declaration coupled with a claim for enforceable
    relief is, in substance, a claim for a remedy against the other party and not
    merely a request for a declaratory order.

[52]

This is because, if it is a claim for a
    substantive remedy against another party, then the limitation period applicable
    to that substantive remedy will apply to that claim. Similarly, if a
    declaration is necessary as a prelude to a claim for a remedy against another
    person, no limitation period applies to the proceeding for a declaration, but the
    applicable limitation period for seeking the remedial order may still bar that
    claim.

[53]

Accordingly, if a party seeks both consequential
    and declaratory relief against another party, the consequential relief is
    subject to the limitation periods set forth in the
Limitations Act
, or
    in this case, the
Family Law Act
, while the declaratory relief alone
    benefits from the absence of a limitation period. The bar is not against
    joining a claim for consequential relief; the bar is against applying no
    limitation period to the consequential relief.

[54]

Applying the principle to this case, where the
    husband seeks a declaration that would remove a significant obstacle to his
    claims for equalization and for spousal support, that declaration is subject to
    no limitation period, pursuant to s. 16(1)(a) of the
Limitations Act
.
    The limitations governing the consequential relief he seeks, namely
    equalization and support, are the periods applicable to those forms of relief:
    six years from the date of separation for equalization, and no limitation
    period for support.

[55]

Conversely, had the husband brought his
    equalization claim seven years after the date of separation with no reasonable
    possibility of reconciliation, and therefore out of time, the fact that he
    would be able to obtain a declaration setting aside the marriage contract would
    not mean that his equalization claim could proceed. That claim would remain
    time-barred, subject to the power of the court to extend the time under s.
    2(8).

[56]

In summary, although one may always characterize
    any relief that is sought that depends on the outcome of the declaration
    proceeding as consequential relief, the intent and effect of s. 16(1)(a) is not
    to preclude the party seeking the declaration from also asking for
    consequential relief as a matter of procedure. It is to prevent a party who
    seeks a consequential remedy from circumventing the limitation period that is
    applicable to the claim for the remedy by joining that claim with an
    application for a declaration: see, for example,
Alguire v. The
    Manufacturers Life Insurance Company (Manulife Financial)
, 2018 ONCA 202,
    140 O.R. (3d) 1, at para. 29; see also Sarna, at pp. 55-56.
[3]


(3)

Conclusion on s. 16(1)(a) of the
Limitations
    Act

[57]

I conclude that a proceeding under s. 56(4) of
    the
Family Law Act
comes within s. 16(1)(a) of the
Limitations Act
.
    There is no limitation period for bringing the proceeding for a declaration
    setting aside a marriage contract, whether as a stand-alone matter or if the
    proceeding also claims other family law relief. The other relief remains
    subject to the applicable limitation periods, including the residual discretion
    of a family court to grant extensions of time under s. 2(8) of the
Family
    Law Act
. In this case, those limitation periods are six years for the
    husbands equalization claim, and there is no limitation period for his spousal
    support claim.

[58]

This result also works seamlessly within the
    limitation structure of the
Family Law Act
, because it does not add a
    new, shorter limitation period of two years, which would disrupt the longer
    time spouses have been given to resolve their affairs. It does not interfere
    with the philosophy of the Act, which is to give more generous time periods for
    separating spouses to resolve their claims for equalization and spousal
    support.

[59]

Moreover, while spouses may seek to set aside a
    marriage contract in the circumstances set out in s. 56(4) at any time, a
    spouse is unlikely to bring such an application during the marriage, even if
    the spouse learns that the other spouse failed to disclose some material assets
    when they were negotiating their agreement. If they remain happily married,
    there will be no need.

[60]

An application to set aside a marriage contract
    would likely be brought in the context of marriage break-up and its financial
    consequences for the parties. Those financial consequences are governed by the
    limitation periods specified in the Act and in the
Limitations Act
. An
    application to set aside a marriage contract will not extend or reduce those
    periods.

(4)

Is the request to set aside a marriage contract
    a claim for loss or damage caused by an act or omission?

[61]

Because of my conclusion that the request to set
    aside a marriage contract under s. 56(4) of the
Family Law Act
is a
    proceeding for a declaration where no consequential relief is sought under 16(1)(a)
    of the
Limitations Act
, it is unnecessary to consider whether that
    request falls within the definition of claim, and in that context when the loss
    or damage occurred and when the husband discovered the claim.

H.

Disposition

[62]

Accordingly, I conclude that the motion judge
    erred in law in failing to find that s. 16(1)(a) of the
Limitations Act

applies to a proceeding under s. 56(4) of the
Family Law Act
for a
    declaration setting aside the marriage contract, and in finding that the two-year
    limitation period under s. 4 applies.

[63]

I would therefore allow the appeal and set aside
    the summary judgment, with costs of the appeal to the husband in the agreed
    amount of $10,000 inclusive of disbursements and HST. If the parties are unable
    to agree on the costs of the summary judgment motion in light of the
    disposition of the appeal, they may each file costs submissions not exceeding
    two pages in length by August 10, 2020.

K. Feldman
    J.A.

B. Zarnett
    J.A.





Brown J.A. (Concurring):

I
INTRODUCTION

[64]

I agree with my colleague that the
    husbands appeal should be allowed and the summary judgment granted by the
    motion judge be set aside. However, I reach that conclusion by a different
    path.

II.
POINTS OF DISAGREEMENT

[65]

Although I agree with my colleague
    that the motion judge did not err by treating the husbands pleadings (Application
    and Reply) as containing a request to set aside the marriage contract, I
    respectfully disagree with two of my colleagues other conclusions.

A.

Do all proceedings invoking s. 56(4)
    of the
Family Law Act
fall within s. 16(1)(a) of the
Limitations Act,
    200
2
?

[66]

With respect, I am unable to agree
    with my colleagues broad statement, at para. 57, that a proceeding under s.
    56(4) of the
Family Law Act
comes within s. 16(1)(a) of the
Limitations Act
.

[67]

It may or it may not.

[68]

I agree that a proceeding that seeks
    only to set aside a domestic contract under s. 56(4) of the
Family Law Act
,
    R.S.O. 1990, c. F.3
(the 
FLA
) and does not seek
    consequential relief may well fall within the language of s. 16(1)(a) of the
Limitations Act
, 2002
, S.O. 2002,
    c. 24 Sched. B (the 
Limitations Act
)
,
    namely: There is no limitation period in respect of (a) a proceeding for a
    declaration if no consequential relief is sought.

[69]

However, such a proceeding would
    be a rare bird. As put by Abrams and McGuinness in
Canadian
    Civil Procedure Law
,
2nd Edition
(Markham:
    LexisNexis Canada, 2010)
, at
§
5.87:
    Proceedings for declarative relief within the description of clause [16(1)](a)
    are relatively rare, although not unknown.

[70]

The reality of family law
    litigation is that a proceeding in which an applicant seeks to set aside a
    domestic contract invariably also contains, as part of the prayer for relief,
    requests by the applicant for consequential relief relating to support or
    property equalization. Seeking such relief in the same proceeding in which the
    applicant attempts to set aside a domestic contract would take the proceeding
    outside of the language of
Limitations Act
,

s. 16(1)(a).

B.

Does the husbands proceeding seek consequential relief
?

[71]

Second, I respectfully disagree
    with my colleagues conclusion, at para. 45, that the husbands proceeding is
    one for a declaration that does not seek consequential relief within the
    meaning of
Limitations Act
, s. 16(1)(a).

[72]

A
declaratory judgment is a formal statement by a court
    pronouncing upon the existence or non-existence of a legal state of affairs 
    it is restricted to a declaration of the parties rights and does not order any
    party to do anything:
Starz (Re)
, 2015 ONCA 318, 125 O.R. (3d) 663, at
    para. 102.
However, the present case is
    not one where the husbands request for an order setting aside the marriage
    contract is for an existential judgment that considers rights to be or not to
    be or where the parties are not even called upon to take the next step in
    accommodating the declaration so that the failure of the parties to abide by
    its guidance will inevitably lead to independent subsequent proceedings
    claiming consequential relief, all hallmarks of a proceeding for a declaration
    in which no consequential relief is sought: Lazar Sarna,
The Law of Declaratory Judgments
, 4th ed.
(Toronto: Thomson Reuters, 2016), at pp. 7 and 54.

[73]

On the face of his pleadings, the
    husband seeks relief consequential to setting aside the marriage contract. The
    husbands originating Application, in the section headed Claim by Applicant,
    seeks three forms of relief: (i) indexed spousal support; (ii) equalization of
    net family properties; and (iii) costs. In addition, the motion judge interpreted
    portions of the husbands Application and Reply as requesting an order to set
    aside the marriage contract pursuant to s. 56(4) of the
FLA
. Consequently, the husbands request for an order setting aside the
    marriage contract goes beyond clarifying the nature of a particular obligation:
Alguire v. The Manufacturers Life Insurance Company
    (Manulife Financial)
, 2018 ONCA 202,
    140 O.R. (3d) 1, at para. 29;
Leibel v. Leibel
, 2014 ONSC 4516, at para. 38.

[74]

Instead, the request attempts to
    open the door to the court granting him spousal support and an equalization
    payment. So framed, the essential nature of what the husband is seeking in
    his proceeding, the pith and substance of the relief he seeks, is spousal
    support and an equalization payment:
Skylark Holdings
    Limited v. Minhas
, 2018 ONSC 1568
    (Div. Ct.), at para. 8;
Van Halteren v. De Boer
    Tool Inc.
, 2018 ONSC 1554, at para.
    6.

[75]

Accordingly, if the husbands
    proceeding is characterized as one seeking a declaration under s. 56(4) of the
FLA
, it is not a proceeding
    for a declaration in which no consequential relief is sought. On the contrary,
    it very much is a proceeding in which relief is sought consequential to the
    order to set aside the marriage contract. As a result, it does not fall within
    the language of s. 16(1)(a) of the
Limitations Act
.

[76]

The question then is: what
    limitation periods apply to the husbands proceeding?

III.
THE PARTIES POSITIONS

[77]

The parties offer two different
    answers to that question.

[78]

The respondent wife supports the
    motion judges conclusions that (i) the husbands request to set aside the
    marriage contract constitutes a discrete claim within the meaning of s. 1 of
    the
Limitations Act
(ii) to which the two-year basic limitation period
    contained in s. 4 of that Act applies (iii) with the result that since the
    husband discovered that claim no later than October 17, 2012 (iv) his August
    24, 2017 application was commenced out-of-time (v) notwithstanding that his
    requests for an equalization payment and spousal support were brought within
    the applicable limitation periods. However, the respondent further submits that
    this court should add a gloss to ss. 4 and 5 of the
Limitations Act
so that a
    claim to set aside a marriage contract is presumptively discovered on the
    date the parties separate. This submission appears to recognize that requiring
    a party to apply to set aside a marriage contract within two years of the
    discovery of some injury, loss or damage while the marriage remains on-going
    would result in a harsh, if not absurd, application of the
Limitations Act
.

[79]

On his part, the husband disagrees
    that his request to set aside the provisions of the marriage contract regarding
    his claims for an equalization payment and spousal support is a stand-alone
    claim for limitation period purposes. Instead, he characterizes his request
    to set aside those provisions as a gateway to claiming his statutory rights
    to equalization and spousal support. As such, the timeliness of his set aside
    request falls to be determined by the limitation periods applicable to his
    monetary claims for an equalization payment and spousal support, a six-year
    limitation period and no limitation period, respectively.

IV.
ANALYSIS

[80]

I am persuaded by the husbands
    submission. It more closely accords with the statutory language regarding the
    interplay between Ontarios family law and limitation periods regimes.

A key interpretative principle

[81]

A key principle governing the
    interplay between those two regimes is that the basic two-year limitation
    period that applies to a proceeding  in respect of a claim does not apply to
    proceedings seeking equalization payments or spousal support. Instead, the
Limitations Act
recognizes special limitation periods for each.

[82]

In the case of spousal support, s.
    16(1)(c) of the
Limitations Act
states:

There is
no limitation period
in
    respect of  (c) a proceeding to obtain support under the
Family
    Law Act
or to enforce a provision for support or maintenance
    contained in a contract or agreement that could be filed under section 35 of
    that Act. [Emphasis added.]

[83]

In the case of an equalization
    payment,
FLA
s. 5(1) sets out the basic entitlement:

When a divorce is granted
    or a marriage is declared a nullity, or when the spouses are separated and
    there is no reasonable prospect that they will resume cohabitation, the spouse
    whose net family property is the lesser of the two net family properties is
    entitled to one-half the difference between them.

Section 7(1) of the
FLA
specifies the process by which a person can
    seek a court order for an equalization payment:

The court may, on the application
    of a spouse, former spouse or deceaseds spouse personal representative,
    determine any matter respecting the spouses entitlement under section 5.

[84]

Section
19(1)(a) of the
Limitations
    Act
recognizes that the limitation
    period applicable to a proceeding seeking an equalization payment is that set
    out in
FLA
s. 7(3), which states:

An application based on subsection 5(1)
    or (2) shall not be brought after the earliest of,

(a) two years after the day the marriage
    is terminated by divorce or judgment of nullity;

(b) six years after the day the spouses
    separate and there is no reasonable prospect that they will resume
    cohabitation;

(c) six months after the first spouses
    death.

In the present case, the husbands request for an equalization payment
    falls within the six-year limitation period in
FLA

s.
    7(3)(b).

[85]

Accordingly, the starting points
    for determining the limitation periods applicable to a proceeding in which
    spousal support or an equalization payment is sought are s. 16(1)(c) of the
Limitations Act
and s.
    7(3) of the
FLA
, respectively
.

The treatment of domestic contracts in the
FLA

[86]

Does this starting point change
    when the proceeding seeking an equalization payment or spousal support also
    requests an order setting aside a domestic contract, or a provision in a
    domestic contract, that restricts or waives a partys entitlement to an
    equalization payment or spousal support? I am not persuaded that it does.

[87]

I recognize that the
FLA
accords strong
    recognition to domestic contracts: it provides that the contract prevails in
    respect of a matter also dealt with by the
FLA
, unless the Act provides otherwise:
FLA
, s. 2(10). A marriage
    contract may deal with the ownership in or division of property, as well as
    with support obligations:
FLA
, ss. 52(1)(a) and (b).

[88]

But the
FLA
subjects aspects of
    domestic contracts to judicial supervision. Under s. 56(4), a court may set
    aside a domestic contract in the event certain circumstances occurred at the
    time the contract was entered into, such as inadequate financial disclosure,
    lack of understanding of the nature and consequences of the contract or basic
    contract formation problems.
FLA
s. 56(4) deals with unconscionable agreement:
Scheel v. Henkelman
(2001), 52 O.R. (3d) 1 (C.A.), at para. 15.

[89]

As well, a court may set aside a
    contractual waiver of the right to spousal support where it results in
    unconscionable circumstances. Specifically,
FLA
s. 33(4) provides that in considering an application
    for support under
FLA
s. 33(1):

The court may set aside a provision for support
    or a waiver of the right to support in a domestic contract and may determine
    and order support in an application under subsection (1) although the contract
    contains an express provision excluding the application of the section,

(a) if the provision for support or the
    waiver of the right to support results in unconscionable circumstances...

[90]

The case law recognizes that the
    setting aside of a waiver of support provision that results in unconscionable
    circumstances under
FLA
s. 33(4) occurs as part of the courts consideration
    of an application for spousal support:
Scheel
, at
    paras. 15-16. Consequently, no limitation period would apply to the examination
    of a waiver of support provision under
FLA
s. 33(4) that is raised as part of a s. 33
    application for spousal support by reason of s. 16(1)(c) of the
Limitations Act
.

[91]

However, the
FLA
does not expressly
    specify the limitation period applicable to an application to set aside a
    domestic contract that relies on the unconscionable agreement factors
    contained in
FLA
s. 56(4). The respondent submits that the lack of an express limitation
    period covering s. 56(4) applications is significant. It means that where an
    applicant commences a proceeding for an equalization payment and spousal
    support, coupled with a request to set aside a domestic contract for any of the
    reasons specified in
FLA
s. 56(4), a discrete limitation period applies to the
    set aside request: namely, the basic two-year limitation period found in s. 4
    of the
Limitations Act
. That is because the threshold request to set aside
    the domestic contract constitutes a discrete claim in the proceeding that
    attracts the basic limitation period. As I will explain, I do not accept this
    submission.

Applying the key interpretative principle

[92]

One must recall the key
    carve-out principle that governs the interplay between Ontarios family law
    and limitation periods regimes: the basic two-year limitation period in the
Limitations Act
does not
    apply to proceedings seeking an equalization payment or spousal support. If
    such a proceeding includes a request to set aside a domestic contract on any
    grounds specified in
FLA
s. 56(4), does a discrete limitation period apply to
    that part of the proceeding or do the equalization payment and spousal support
    limitation periods apply?

[93]

The answer really boils down to
    the perspective one takes of the proceeding. Is the set aside request a
    discrete, stand-alone claim? Or, should
the set aside
    request be treated as one subsumed within the proceeding claiming an
    equalization payment and spousal support under the
FLA
?


[94]

In answering those questions,
    courts should be reluctant to discover or add yet another limitation period to
    family law litigation given the remedial nature of family law legislation. As
    well, in seeking to answer the questions courts must recognize the reality of
    contemporary family litigation: a very large number of family law litigants are
    now self-represented. Accordingly, in this area of the law, necessity dictates
    that simplicity and understandability of the rules of the game must be a
    major consideration in the interpretative exercise.

[95]

In my view, the statutory language
    governing claims for equalization payments and spousal support indicate that
    any related set aside request in a proceeding be treated as one falling under
    the limitation periods that apply to the requests for an equalization payment
    and spousal support asserted in the proceeding.

[96]

Dealing first with a proceeding
    that seeks spousal support, s. 16(1)(c) of the
Limitations
    Act

states that:

There is no limitation period in respect
    of
a proceeding to obtain support
under the
Family Law Act
or to enforce a provision for
    support or maintenance contained in a contract or agreement that could be filed
    under section 35 of that Act.
[Emphasis added.]

[97]

The statutory language of a
    proceeding to obtain support under the
Family Law
    Act
 is broad enough to include a
    proceeding that couples a request to set aside the provisions of a domestic
    contract that limit or waive spousal support for reasons set out in
FLA
s. 56(4) with a
    request for an order to provide spousal support under
FLA
s. 33(1). The bars to
    relief contained in the domestic contract would have to be set aside in order
    for the applicant to obtain support under the
FLA
.

[98]

Such an interpretation does not
    undermine the recognition given to domestic contracts by
FLA

s. 2(10). It is consistent with the policy of allowing
    courts to set aside waivers of support in domestic contracts that result in
    unconscionable circumstances:
FLA
, s. 33(4). It also is in step with the approach under
    the
Divorce Act
, R.S.C. 1985, c. 3 (2nd Supp.)
that a domestic contract is a factor that the court
    must consider on an application for spousal support:
Miglin v. Miglin
, 2003
    SCC 24, [2003] 1 S.C.R. 303, at paras. 68-78.

[99]

So too, the language of s. 7 of
    the
FLA
is broad enough to include a proceeding that couples a request to set aside the
    provisions of a domestic contract that limit or waive an equalization payment
    for reasons set out in
FLA
s. 56(4) with a request for an order determining a
    spouses entitlement to an equalization payment under
FLA
s. 5.

[100]

As noted earlier,
FLA
s. 7(3) creates
    special limitation periods for an application based on subsection 5(1) or
    (2). The husbands request for an equalization payment is based on subsection
    5(1). The language in
FLA
s. 7(1) that authorizes a court to determine
any
    matter respecting the spouses entitlement under section 5
 (emphasis
    added) is broad enough to include a concurrent request to set aside, for the
    reasons set out in
FLA
s. 56(4), the provisions of a domestic contract that
    limit or waive the right to an equalization payment. In other words,
    determining whether the provisions of a domestic contract validly limit or
    waive a spouses entitlement to an equalization payment falls within the
    language of determining any matter respecting the spouses entitlement under section
    5.

V.
CONCLUSION

[101]

The husbands proceeding couples a
    request to set aside the provisions of the marriage contract that bar his
    entitlement to an equalization payment and spousal support with his claims for
    an equalization payment and spousal support. So framed, the husbands
    proceeding to set aside the bars to an equalization payment in the marriage
    contract and to secure an equalization payment is subject to the six-year
    limitation period in
FLA
s. 7(3)(b); his proceeding to set aside the bars to
    spousal support in the marriage contract and to obtain spousal support are not
    subject to any limitation period pursuant to s. 16(1)(c) of the
Limitations Act
. Since
    the husband commenced his proceeding approximately five years following the
    date of separation, his proceeding is not statute-barred.

[102]

Consequently, I agree with my
    colleague that the husbands appeal must be allowed and the summary judgment
    set aside. I agree with my colleagues disposition of costs.

Released: K.F. July 23, 2020

David Brown J.A.





[1]
On appeal, the husband raised other arguments regarding the
    interpretation of the
Family Law Act
for limitations purposes, one of
    which was accepted by my colleague in his concurring reasons.



[2]

The
    husband did not seek to rely on s. 33(4) of the
Family Law Act
on the
    summary judgment motion, but made arguments about the applicability of s. 33(4)
    for the first time on appeal. In any event, as I discuss at para. 37 of these
    reasons, an order to set aside a spousal support clause in a marriage contract
    will be made under that section in the context of a support application under
    s. 33(1), for which there is no limitation period: see s. 16(1)(c) of the
Limitations
    Act
.



[3]
Professor Sarna explains, at pp. 55-56, that some actions for
    declaratory relief may nevertheless seek remedial orders:

The importance of
    defining an order as declaratory or remedial lies in part in the question of
    limitations. Limitation periods for remedial claims are statutorily different
    than that for declarations, if any. For example, many provincial statutes
    define the remedial order as a judgment or an order made by a court in a
    civil proceeding requiring a defendant to comply with a duty or to pay damages
    for the violation of a right, but excludes a declaration of rights and duties,
    legal relations, or personal status without consequential relief.

If in addition to
    declaratory relief, a claim against pension trustees would require them to act
    by making payment, the thrust of the action seeks a remedial order, and engages
    the [Ontario]
Limitations Act
. Similarly, a foreclosure action
    effectively seeks a remedial order because an order nisi, although containing a
    declaration of a mortgage being in default, also orders requiring the debtor to
    pay. The borderline cases where a litigant tries to avoid the limitations bar
    by using a declaratory recourse will easily be screened out by the presumption
    that all claims are caught by limitations. Accordingly, the litigant cannot
    avoid the consequences of the passage of time by seeking a declaration that
    money is payable. [Footnotes omitted.]


