Business agreement (limitation period exception)

A purchase agreement between two businesses may say something about claim deadlines. Whether that wording works is a question for s. 22 of the Act. The starting point is that a limitation period applies despite any agreement to vary or exclude it, subject only to the exceptions in s. 22(2) to (6). This entry covers Ontario only; check the rules where you are.

What the exception allows

• A limitation period other than the s. 15 ultimate period may be varied or excluded by a business agreement made on or after October 19, 2006.
• The s. 15 ultimate period may be varied by a business agreement, but it may be suspended or extended only as s. 22(4) allows, which requires that the claim has been discovered.
• In s. 22, “vary” includes extend, shorten and suspend.

Who counts

The test looks at who the parties are. The Consumer Protection Act, 2002 defines a consumer as an individual acting for personal, family or household purposes, and not a person acting for business purposes. A note in the Limitations Act says the reference will change to the Consumer Protection Act, 2023 on a day to be proclaimed. See whether a purchase agreement can change the limitation period and the discoverability principle.