Brett v. Anthony & Boulton et al., (1998) 173 N.S.R.(2d) 278 (CA)

• Judge: Glube, C.J.N.S., Chipman and Cromwell, JJ.A.
• Court: Court of Appeal of Nova Scotia (Canada)
• Case Date: December 07, 1998
• Jurisdiction: Nova Scotia
• Citations: (1998), 173 N.S.R.(2d) 278 (CA)

Brett v. Anthony & Boulton (1998), 173 N.S.R.(2d) 278 (CA);

    527 A.P.R. 278

MLB headnote and full text

Temp. Cite: [1999] N.S.R.(2d) TBEd. JA.050

Anthony & Boulton and James N. Horwich (appellants) v. Bruce R. Brett (respondent)

(C.A. 149502)

Indexed As: Brett v. Anthony & Boulton et al.

Nova Scotia Court of Appeal

Glube, C.J.N.S., Chipman and

Cromwell, JJ.A.

December 7, 1998.

Summary:

Brett sued accountants for negligent prep­aration of a corporation's financial state­ments. Brett applied to strike the paragraph of the statement of defence which asserted that the action was time barred, or, alterna­tively, an order under s. 3(2) of the Limita­tions of Actions Act, disallowing the defence. The accountants opposed the appli­cation and applied in the final alternative for security for costs.

The Nova Scotia Supreme Court, in a decision reported 171 N.S.R.(2d) 356; 519 A.P.R. 356, struck the paragraph from the statement of defence. The court declined to order security for costs. The accountants sought leave to appeal.

The Nova Scotia Court of Appeal granted leave, however, the court dismissed the appeal.

Limitation of Actions - Topic 15

General principles - Discoverability rule - Application of - Brett sued a bank and third partied accountants respecting their preparation of financial statements in 1988/1989 - Although the third party action was discontinued, Brett refused to agree to a dismissal - In response to Brett's 1993 complaint against the accoun­tants, the Institute of Chartered Accounts released a report in June 1995 - Due to financial difficulties, Brett was unable to sue the accountants until May 1997 - The trial judge applied the discoverability rule and held that the action was out of time where Brett knew of the impugned trans­actions from the outset, relied on his part­ner and did not act out of loyalty to the partner - However, the court struck the limitation defence where the matter had not laid dormant and the de­fendants were not prejudiced (Limitations of Actions, s. 3(2)) - The Nova Scotia Court of Appeal affirmed the decision.

Limitation of Actions - Topic 9305

Postponement or suspension of statute - General - Discoverability rule - [See Limitation of Actions - Topic 15 ].

Limitation of Actions - Topic 9426

Bars - Disallowance of defence - Con­siderations - Prejudice to parties - [See Limitation of Actions - Topic 15 ].

Practice - Topic 8105

Costs - Security for costs - General prin­ciples - Considerations - A plaintiff sued accountants, alleging that they negligently prepared financial statements which he relied on in executing a guarantee - The accountants sought security for costs based on an unsatisfied judgment against the plaintiff for taxes owing - The plaintiff asserted that the judgment was related to his financial state which was due to him addressing the guarantee and he would not have executed the guarantee but for the accountants' misconduct - The trial judge refused to order security for costs - The Nova Scotia Court of Appeal affirmed the decision, however, stated that it was with­out prejudice to the accountants' right to "bring a further application for security for costs if additional cogent evidence on the relevant issue is developed" - See para­graph 13.

Practice - Topic 8111

Costs - Security for costs - General prin­ciples - Where plaintiff has failed to sat­isfy prior judgment or order - [See Prac­tice - Topic 8105 ].

Practice - Topic 8112

Costs - Security for costs - General prin­ciples - Where plaintiff insolvent or impe­cunious - [See Practice - Topic 8105 ].

Cases Noticed:

Motun (Canada) Ltd. et al. v. Detroit Die­sel-Allison Canada East (1998), 165 N.S.R.(2d) 217; 495 A.P.R. 217 (C.A.), refd to. [para. 13].

Counsel:

Harry E. Wrathall, Q.C., and Stephen Kingston, for the appellants;

Ian A. Blue, Q.C., Blair H. Mitchell and Moonlake Lee, for the respondent.

This appeal was heard on December 7, 1998, before Glube, C.J.N.S., Chipman and Cromwell, JJ.A., of the Nova Scotia Court of Appeal. On the same date, Glube, C.J.N.S., delivered the following judgment for the court orally, with written reasons released on December 11, 1998.