Can I sue an appraiser for a negligent business valuation?

A valuation is an opinion, and whether a wrong one gives rise to a claim depends on facts a lawyer has to assess. A buyer who paid on the strength of a report and then finds a serious flaw should move quickly to gather the documents and speak to a litigation lawyer. This page covers only the time limits and the practical facts; it does not say whether a particular claim would succeed.

The clock runs from discovery

In Ontario, unless the Limitations Act, 2002 provides otherwise, s.4 bars a proceeding after the second anniversary of the day the claim was discovered. A claim is discovered on the earlier of when the person first knew of the matters in s.5(1)(a) and when a reasonable person with their abilities and in their circumstances first ought to have known. Under s.15(2), subject to the rest of s.15, no proceeding may be started after the 15th anniversary of the act or omission. Alberta’s Limitations Act sets two years from when the claimant first knew or ought to have known of the matters it lists, or ten years after the claim arose, whichever expires first.

British Columbia and the agreement

Subject to that Act, British Columbia’s Limitation Act sets two years from discovery, with a separate ultimate limitation period in Part 3. Other provinces and territories run their own regimes. In Ontario, s.22(1) says a limitation period applies despite any agreement to vary or exclude it, subject only to the exceptions in s.22(2) to (6). Under s.22(5), a business agreement, meaning one made by parties none of whom is a consumer, may vary or exclude a period other than the s.15 one, and may vary the s.15 period within limits. So read the valuator’s engagement letter for any clause that shortens or extends the time.

Gather the facts now

Collect the engagement letter, the report and its stated purpose, the documents the valuator received, your communications and what you paid in reliance. Ontario’s s.11(1) pauses the ss.4 and 15 periods when the parties agree to have an independent third party resolve the claim or assist them in resolving it, until the events listed in that section occur. Do not assume talks have stopped the clock without confirming it in writing.