Can a contract extend or shorten Ontario's standard limitation period?

Ontario's Limitations Act allows parties to vary the standard limitation period in some circumstances, but with important restrictions. Since 2016, parties to a business agreement can agree to extend or suspend the limitation period — for example, agreeing to extend the time to bring a claim in a particular contract. They can also agree to shorten it in some commercial contexts. However, such agreements must be clear, and they must be made after the claim is discovered (or at the time of the agreement, in a business context).

The rules are stricter when consumers are involved. The Limitations Act prevents parties from contracting out of the basic limitation period in agreements with consumers. A business cannot bury a clause in a consumer contract that shortens the time a customer has to sue — those provisions are not enforceable.

Even where a limitation period has technically expired, a defendant can waive the limitation period defence by acknowledging the debt or claim in writing or by making a payment toward it. An acknowledgment restarts the limitation clock and gives the plaintiff fresh time to sue. Both creditors and debtors should be careful about what they put in writing, as a simple acknowledgment of a debt can revive an otherwise dead claim.