Rolling Limitation Period Applied To Breach Of Covenant In Lease

​When Does the Limitation Period Run in the Context of a Continuing Breach?

The Court of Appeal for Ontario recently answered this question in Pickering Square Inc. v. Trillium College Inc.

The facts of this case are simple. Trillium College Inc., the tenant in commercial space in a shopping centre, vacated its premises contrary to the lease which required the tenant to operate its vocational college business continuously throughout the term of the lease. The Court of Appeal held that the motion judge properly concluded that a fresh cause of action occurred every day that breach continued – every day that Trillium failed to carry on its business in the leased premises in accordance with the covenant in the lease. The limitation period in the case of a breach of a continuing obligation applies on a rolling basis. The two-year limitation period commences each day a fresh cause of action accrues and runs two years from that date.