In Esopenko v. RM of Garden River #490, 2026 SKCA 102, the Saskatchewan Court of Appeal unanimously upheld the striking of a former municipal employee’s claims because they were filed outside the one-year limitation period under s. 344(1) of The Municipalities Act. The decision is an important reminder for municipalities and employers about the significance of statutory limitation periods.
The facts
Elaine Esopenko was the Town Administrator for the Rural Municipality of Garden River #490 for over 20 years. Following workplace conflict and health issues beginning in late 2015, she went on sick leave in April 2016 and was suspended without pay the following month. In February 2018, nearly two years later, she sued the RM, alleging wrongful termination, breach of contract, negligence and bad faith. She also brought claims against a fellow employee, Brenda Moberg.
A King’s Bench judge struck all claims. The RM claims were time-barred, and the claims against Ms. Moberg failed to disclose a reasonable cause of action. The Court of Appeal agreed on all counts.
Key takeaways for municipalities and employers
The one-year municipal limitation period is strictly enforced – The Court confirmed that s. 344(1) of The Municipalities Act means what it says. Based on the plaintiff’s own pleadings and her lawyer’s correspondence, the Court found she had discovered her claims by the summer of 2016 at the latest, well before the February 2018 filing. Municipalities should be aware of this defence and raise it promptly.
Reframing a claim does not restart the clock – Ms. Esopenko argued that the distinction between “constructive dismissal” and “wrongful termination” meant the limitation period had not begun. The Court rejected this, holding that both describe a breach of the employment contract. The limitation clock starts when the employee knows the employment relationship has effectively ended and they have suffered a loss.
Good record-keeping is a litigation asset – The RM’s contemporaneous correspondence, letters about Ms. Esopenko’s absence, suspension and employment status, helped establish the timeline that proved her claims were statute-barred. Municipalities should document workplace events thoroughly and preserve all correspondence from opposing counsel.
Bad faith is not a standalone cause of action – The claims against Ms. Moberg were properly struck because, after the pleadings were amended, the only remaining allegation was bad faith, which the Court confirmed does not give rise to an independent claim.
Esopenko confirms that courts will enforce statutory limitation periods and will look to a claimant’s own pleadings and evidence to determine when claims were discovered. For municipalities, the message is clear: Maintain thorough employment records, engage legal counsel early and know your statutory defences.
The MLT Aikins Municipal practice group has extensive experience representing numerous municipalities in Western Canada (including cities, towns and rural municipalities) in a general counsel capacity, advising Councils, administration, committees and boards. Our experience covers the range of legal issues a municipality may expect to face on a daily basis, including planning, development, enforcement and employment matters as well as longer term initiatives such as bylaw and policy review and development.
Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.
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