As the quarter-final round of the World Cup is happening, the Ontario Court of Appeal saw fit to release a decision about an altercation that occurred in the middle of a soccer game. For those not familiar with the sport, physical altercations are not typical: soccer is a technical sport which requires high physical stamina, incredible ball control, and a dash of theatrics to make a fall look more painful than it actually is (see Neymar Jr’s theatrics at the 2018 World Cup). However, when tempers rise and an altercation ensues, who should be held responsible for damages associated with an assault on the field?
On September 9, 2010, the North Mississauga Soccer Club was playing against Hamilton Sparta in a game governed by the Ontario Soccer Association (OSA). In the middle of the game, Da Silva, a player on the North Mississauga club, was battling for the ball against a player from Hamilton Sparta. The referee decided that the battle was too physical and stopped the play. After the whistle blow, players from both teams ran onto the field from the benches. Among those players was Gomes, a player from Hamilton Sparta, who decided to punch Da Silva.
Gomes was criminally convicted of assault. Da Silva also commenced a civil suit against Gomes, Hamilton Sparta, the coach, team manager and vice president of Hamilton Sparta, and the OSA. The defendants (with the exception of Gomes) brought a summary judgment motion to dismiss the action against them.
At the summary judgment motion, Da Silva argued that the defendants breached the standards of care for coaches, on-field supervision, and player conduct. Fundamental to his claim was the argument that Hamilton Sparta, and its executive team, should have foreseen that Gomes would commit an assault and should have prevented him from playing. This was based on two previous occasions where Gomes had verbal altercations with referees.
The motion judge rejected this argument. She relied on case law from BC and concluded that, when dealing with sport coaches, “the standard of care is not that of a careful and prudent parent but whether the coach acted in accordance with the ordinary skill and care of a coach in the circumstances in which he or she find themselves”. The motion judge found that the assault was a “sudden and unexpected” event that was not foreseeable by the club, its staff, or the OSA. The judge also determined that the two past incidents were not predictive of Gomes’ conduct exhibited in this game.
Additionally, the FIFA Laws of the Game (the rules governing Ontario Soccer) specifically state that the coach and other team officials are not allowed to enter the field of play without the permission of the referee. Therefore, Hamilton Sparta staff could not do anything to prevent the assault from occurring.
The Plaintiff attempted to rely on Forestiere v. Urban Recreation Limited, wherein the court found that a coach had breached a standard of care when a player was injured as a result of a slide tackle. However, the motion judge distinguished this case as, in Forestiere, the slide tackle was performed by an unregistered player who was not aware of a rule unique to that league: no slide tackling. In that case, the court found that the coach breached the standard of care by not informing the unregistered player of this rule.
The motion judge found that there is no unique rule to soccer prohibiting one player from punching another – it’s simply a criminal act. A code of conduct prohibiting punching during a game would not be a unique rule and likely would not have prevented Gomes from committing the assault. The motion judge concluded that the OSA, Hamilton Sparta, and its coach, manager, and Vice President did not breach their respective standards of care. The judge therefore dismissed the action against these defendants.
The Ontario Court of Appeal
The Ontario Court of Appeal agreed with the motion judge.
The Court of Appeal found that the motion judge did not make any palpable and overriding errors and confirmed that supervising authorities are “not legally responsible for a sudden unexpected event in the midst of an acceptable, safe activity”.
The court also reiterated the importance of parties putting their best foot forward on summary judgment motions, noting that courts reasonably assume that “the parties have placed before it, in some form, all of the evidence that will be available at trial”. The court specifically noted that the plaintiff’s case “foundered on the absence of evidence”.
Takeaway – Raising the Standard
This case confirms that, in Ontario, athletic organizations and coaches will only be held legally responsible for acts that are foreseeable and that are ultimately preventable. An organization will be held to a higher standard of care if it creates unique rules, policies, and procedures. However, absent a self-implemented standard of care, an athletic organization will not be legally responsible for “sudden unexpected events” in an activity that is innately acceptable and safe. Happy Soccering!
Stas practices in insurance-related litigation. He has a broad range of experience including tort claims, accident benefits, subrogation, priority and loss transfer disputes, WSIB matters, and fraudulent claims. Read more...
The question of whether the jury in a negligence action is required to provide particulars of any finding of the Defendant’s negligence was considered by the Court in Poonwasee v. Plaza. After reviewing the relevant case law, the Court found that there was no such obligation.
The action arose as a result of a motor vehicle accident. Initially, Counsel proposed that the jury questions include a request that the jury provide particulars of the Defendant’s negligence, if there was a finding of negligence. Further, Counsel had proposed that the jury describe the Plaintiff’s injuries if they found that there were injuries caused by the accident. However, during the pre-trial conference, Counsel for the Plaintiff changed his position and did not want the questions to be submitted to the jury.
The Court noted that section 108(5) of the Courts of Justice Act provided that the Judge may require the jury to give a general verdict or answer specific questions. However, the Court noted that there was little case law with respect to the type of questions that ought to be left to the jury. Upon reviewing the case law, the Court acknowledged that there were both advantages and disadvantages to requiring a jury to provide particulars. The advantages were that (1) it allowed for the opportunity to “test” the jury’s understanding of the Court’s instructions; (2) it ensured that the jury did not disregard the law in favour of an emotional verdict; and (3) it concentrated the jury’s mind.
The disadvantages were that (1) it failed to allow for the possibility that the jurors may not agree on the reasons for negligence; and (2) it risked revealing the substance of the jury’s deliberations. The Court also noted that there was a danger that by attempting to precisely articulate the particulars of their findings, the jurors may become distracted from their main tasks of determining liability and damages.
The Court found that the questions put to a jury are within the discretion of the trial judge. In making this determination, the trial judge should consider whether the advantages of asking the jury to provide particulars outweighs the disadvantages. This will depend on the circumstances of the case.
In the present case, the Court found that there was nothing to suggest a need to “test” the jury’s understanding of the instructions on negligence. In fact, the issue was not complex as the Defendant did not lead any evidence to explain her conduct. As such, it was likely that the jury’s focus would be on the issues of causation and damages, not liability. The Court found that nothing would be served by requiring the jury to articulate the nature of the Defendant’s negligence. With respect to the Plaintiff’s injuries, the Court was unable to see how asking the jury to list the injuries would test the jury’s understanding of the judicial instructions. There was conflicting evidence regarding the extent of the injuries. The Court noted that the jury was provided with the standard instructions on causation without objection. Particulars were not required in light of the specific circumstances of the case.
As a result of this decision, parties should not automatically assume that jurors are going to be required to provide particulars on negligence or the nature of the injuries. The parties need to consider whether the benefits of asking for particulars outweigh any disadvantages of same.
The recent decision of Roskaft v. RONA Inc., 2018 ONSC 2934, sheds some light on when an employer can successfully claim frustration of contract when an employee is in receipt of long-term disability benefits.
The facts of this case were fairly straight forward. The Plaintiff began working for RONA in 2002 in a clerical role. In 2012, he started a leave of absence due to a medical condition. The Plaintiff had access to short term and long-term disability benefits provided by Sun Life. Sun Life approved the Plaintiff’s claim for LTD benefits. RONA had no involvement with the Plaintiff’s LTD claim. In December, 2014, Sun Life allegedly advised RONA that the Plaintiff was “permanently” disabled from his own occupation and any occupation. In September, 2015, three years after the onset of his disability, RONA terminated the Plaintiff’s employment due to frustration of contract. RONA relied on Sun Life’s December, 2014 letter and the fact the Plaintiff continued to receive LTD benefits. He was paid his statutory minimum entitlements under the Employment Standards Act, 2000. The Plaintiff commenced an action for wrongful dismissal. He alleged that RONA failed to obtain information from the Plaintiff which would have indicated his condition was improving at the time of dismissal.
On a summary judgment motion, Pollak J., found that the contract of employment between RONA and its employee of 13 years was frustrated by the employee’s 3 year absence.
Interestingly, Pollack J., concluded that the December, 2014 letter from Sun life, on its own, was insufficient to conclude that the Plaintiff was “permanently” disabled. Notably, there was apparently no reference to “permanent” disability in the correspondence. However, due to the following points, he found that it was reasonable to conclude that there was “no reasonable likelihood” that the plaintiff would return to work within a reasonable period of time:
Sun Life’s determination that the plaintiff was sufficiently disabled to receive long term disability benefits;
The Plaintiff’s post termination representations to Sun Life that his medical condition had not improved; and
The Plaintiff’s continued receipt of LTD benefits.
While employers are usually unable to rely on post termination medical documentation to support their claim for frustration, Pollack J., allowed the representations to Sun Life in as evidence. It is likely this post termination evidence that carried the day for the employer. Pollack J., specifically indicated it directly contradicted the plaintiff’s assertion that he would have provided further evidence had RONA asked and have been able to return to work in a reasonable period of time.
It is apparent that Pollack J., was unwilling to let the Plaintiff have his cake and eat it too. On the one hand, the Plaintiff was reporting to Sun Life that his condition remained stable and unchanged. On the other hand, he alleged that had RONA asked for additional medical information, he would have advised that he was improving. Both were unlikely to be accurate.
It is unfortunate that Pollack J. sidestepped the issue of which party had the obligation it is to submit or request medical information. Notably, the Plaintiff dropped his claim under the Human Rights Code, and so Pollack J., did not have to address the issue of accommodation by RONA. While there is case law that suggests an employer may suffer repercussions if they request information too frequently, many employment lawyers will vehemently argue that simply relying on the conclusion of the LTD insurer is insufficient to justify a claim of frustration without more. This decision would suggest that that a determination by the LTD carrier of ongoing disability, coupled with the continued receipt of LTD benefits may be a sufficient basis for employers to allege frustration of contract.
The Plaintiff’s receipt of long-term disability benefits for three years suggests his disability was severe enough that he was unable to engage in any employment for which he was reasonably suited. Those in the long-term disability industry recognize that this is a stringent test to meet and would be compelling evidence for employers to consider a frustration argument. However, as best practices, employers should request additional information from time to time from their employee and seek legal advice prior to making a final determination. While RONA was ultimately successful, their decision to dismiss the employee resulted in costly litigation.
The plaintiffs’ claim relates to an incident that took place on September 8, 2013. On that day, a car being driven by the plaintiff, John Bertolli, drove through a pothole located on McCowan Road, in the City of Markham and the Region of York. Consistent with the requirements of the Municipal Act a notice letter was delivered to the City of Markham advising it of the accident, asserting it had been negligent in the upkeep of the road, was responsible for any damage suffered by the plaintiffs, asking that its property liability insurers be notified, and raising the prospect that an action would be commenced against it. The letter began as follows:
Please be advised that I have been retained by the above noted individuals in connection with personal injuries sustained while driving on McCowan Road, north of Dennison Street, Markham, on September 8, 2013.
The City of Markham (“Markham”) immediately wrote to counsel for the plaintiffs advising that the location of the accident fell under the jurisdiction of the Region of York (“the Region)”, within which Markham is located. Markham passed the letter it had received on to the Region. Counsel for the plaintiffs followed up and sent a letter to the Region, containing the same advice as the letter it had sent to Markham. In particular, it included the same introductory words as quoted above.
Brennan Paving and Construction Ltd. (“Brennan Paving”) was the road maintenance contractor identified as being responsible for the upkeep of the road at the location of the accident. The Region passed on the letter it had received to Brennan Paving.
The Statement of Claim was issued on August 27, 2015 naming the City of Toronto and John Doe Maintenance Company as defendants. The Claim notes the location of the accident as “northbound on McCowan Road, in the City of Toronto” and nothing more. It is important to note that parts of McCowan Road are located in the Region (which includes Markham) and other parts in the City of Toronto. At the time of the accident, and for the five years prior, Brennan Paving was not, and had not been, responsible for the maintenance on the part of McCowan Road that is located in the City of Toronto.
The Statement of Claim was served on the City of Toronto on September 1, 2015 and particulars of the exact location of the alleged accident were requested. In response, counsel for the plaintiffs advised that the “pothole was located in the northbound curb lane of McCowan Road, approximately 49 feet north of the white line/traffic lights at the intersection of McCowan Road and Dennison Street.”
Thereafter counsel for the plaintiffs began the process of bringing a motion to substitute the Region for the City of Toronto as a defendant in the action. Counsel also wrote to the Region asking for “…the legal name of the maintenance company”. No such letter was written to the City of Toronto prior to the issuance of the Statement of Claim.
Once Brennan Paving was identified, the plaintiffs served a Fresh as Amended Notice of Motion to amend the Statement of Claim to substitute the defendant City of Toronto with the Region and to substitute or add Brennan Paving.
The Master granted the motion allowing both the Region and Brennan Paving to be the defendants named in the action, based on the principle of misnomer.
Brennan Paving appealed the Master’s Order.
On setting aside the Master’s Order, the motion judge reviewed the doctrine of misnomer that states:
5.04(2) At any stage of a proceeding the court may by order add, delete or substitute a party or correct the name of a party incorrectly named, on such terms as are just, unless prejudice would result that could not be compensated for by costs or an adjournment.
The court held that the words “add” “delete” and “substitute” as found in the rule should be read each as modifying the authorization to “correct the name of a party incorrectly named”. The test, for misnomer, according to the court must start with the question:
How would a reasonable person receiving the document take it? If, in all of the circumstances of the case and looking at the document as a whole, he would say to himself: “Of course it must mean me, but they have got my name wrong,” then there is a case of mere misnomer. If, on the other hand, he would say: “I cannot tell from the document itself whether they mean me or not and I shall have to make inquiries”, then one is getting beyond the realm of misnomer.
Justice Lederer relied on the reasoning in the Court of Appeal decision, Essar Algoma Steel v Liebherrr (Canada) Co. to conclude that there are two questions to be answered:
Whether the failure of the plaintiffs to correctly name the Region as a defendant is a misnomer, and
Even if a misnomer occurred, should the Court exercise its discretion to refuse to permit the requested correction?
The court was clear that the onus or responsibility for identifying an otherwise unrecognized defendant lies with the plaintiffs and not the Region. The court also felt that it was incumbent on the plaintiffs to do something to figure out who, or what, John Doe Maintenance Company actually was, and they could have done so before issuing the Statement of Claim. It was relevant to the court that the accident occurred on September 8, 2013 and the Statement of Claim was not issued until August 27, 2015, nearly two years later. The court noted there was no reason why, during that time, a request could not have been made to the City of Toronto to determine the name of the maintenance company, and allowed the appeal.
The plaintiffs/respondents appealed. In dismissing the appeal, the Court of Appeal reviewed both the Master’s decision and the Superior Court’s decision and found that although the site of the accident, as identified in the Statement of Claim, was not particularized beyond alleging that it occurred on McCowan Road, in the City of Toronto, the Master concluded that the substituted defendants (the Region and Brennan Paving) would have known they were the intended defendants upon reading the Statement of Claim. The Master also assumed that the substituted defendants would have received a notice letter, delivered to them within days of the alleged accident, which would have identified the precise location of the alleged accident at a particular point on McCowan Road, which was in the Region when, in fact, the notice letter identified Markham as the relevant municipality. Markham forwarded the letter to the Region who, in turn, forwarded it to Brennan Paving.
The Court of Appeal held that even when read in combination, the notice letter and Statement of Claim were not capable of supporting an inference that the substituted defendants (City of Toronto and Brennan Paving) were the intended defendants. Without reference to the pothole in the notice letter and without particulars of the precise location of the accident alleged in the Statement of Claim, the reasonable reader could not know, without further inquiry, that the documents referred to the same accident. As the court states:
Put simply, the Master’s inference that the substituted defendants would know they were the intended defendants was not available on any reasonable view of the evidence. The Master’s order was properly set aside.
This decision clarifies the test for misnomer and makes it clear that it is the plaintiff’s responsibility to identity the proper defendant(s) and to take steps to make that determination before issuing a Statement of Claim.
The Plaintiff’s claim in Walsh v. Papadopoulos arose as a result of a fall that occurred on the basement stairway of a home owned by the Defendant, Antonio Pirone. Two days before the fall, the Plaintiff and her sister, the Defendant, Easter Papadopoulos, had been at their sister’s house in Paris, Ontario to bake. Baskets of baked goods were later transported in Ms. Papadopoulos’ vehicle to the residence of her boyfriend, Mr. Pirone, in Toronto.
The Plaintiff entered Mr. Pirone’s home through the side door. The weather had been wet that day. The Plaintiff was carrying a large basket with both hands which blocked her view of what was at her feet. Ms. Papadopoulos allegedly instructed the Plaintiff to take the basket that she was carrying downstairs. The Plaintiff proceeded to the basement staircase, fell on the steps and fractured her right ankle.
Ms. Papadopoulos brought a summary judgment motion seeking to dismiss the Plaintiff’s claim against her on the basis that she owed no duty of care to the Plaintiff at law.
In support of her contention that Ms. Papadopoulos was an occupier, the Plaintiff relied on the fact that Ms. Papadopoulos had a key to the premises along with various texts suggesting, among other things, that Ms. Papadopoulos spent the majority of her time at her boyfriend’s house.
Ms. Papadopoulos alleged that the Plaintiff failed to submit evidence that would result in the conclusion that she was an occupier of the premises. The Plaintiff provided no objective evidence that the steps in question were unsafe, improperly constructed or maintained. The Plaintiff also had no expert evidence to suggest that there was any defect in the design or maintenance of the steps.
Although there was contradictory evidence, Justice Dow found that the evidence and a matrimonial law precedent being relied on by the Plaintiff could lead to the conclusion, on a balance of probabilities, that Ms. Papadopoulos owed the Plaintiff a statutory duty under s. 3 of the Occupiers’ Liability Act, R.S.O. 1990, c. O.2.
Ms. Papadopoulos was required to show that even if she owed a duty to the Plaintiff and that such a duty was breached, it would not result in a finding of even 1% liability attributable to Ms. Papadopoulos. According to Justice Dow, Ms. Papadopoulos failed to establish this. He concluded that there was a genuine issue for trial with regard to liability and declined to grant the Defendant’s summary judgment motion.
In this case, it did not matter that the Plaintiff failed to provide any objective or expert evidence of any defect or improper maintenance of the steps in question. The key was the Plaintiff’s evidence that Ms. Papadopoulos instructed the Plaintiff to take the basket downstairs when she knew that the Plaintiff was unable to use the handrail on the staircase, which could result in a trier of fact finding that a duty of care was triggered and potentially breached.
As we often see in similar cases involving summary judgment motions, this decision makes it clear that if the motions judge has any doubt as to whether a Defendant can be found even 1% liable on the basis of the available evidence and case law, summary judgment is not likely to be granted. While they can still be a very useful tool to dismiss slip and fall cases, summary judgment motions seem best used in circumstances where the facts do not create even the potential for liability to be found outside the strict confines of the Occupiers’ Liability Act.
Krista has a diverse insurance law practice which focuses on bodily injury litigation, including general negligence/liability claims, motor vehicle accidents, commercial general liability, homeowners’ liability and occupiers’ liability, as well as priority/loss transfer disputes between insurers. Read more...
On June 19, 2018, the Senate voted to pass Bill C-45, the federal government’s bill to legalize and regulate recreational cannabis in Canada. This paves the way for Royal Assent. After a “buffer period” to allow provinces and municipalities to complete preparations, legalization is expected to take place sometime in the Fall of 2018. Regardless of personal opinions, legalization will likely have far-reaching consequences on the Canadian insurance industry.
Generally, the proposed Act will allow adults to purchase, share, and possess up to 30 grams of dried cannabis, grow up to four plants per residence for personal use, and make cannabis products including food or drink. Certain rights can be modified by corresponding provincial legislation, such as Ontario’s Cannabis Act2017, SO 2017, c. 26, Sched. 1, which restricts the age of purchase to 19 as opposed to the federal minimum of 18.
In addition to legalizing the possession and production of recreational cannabis, Bill C-45 provides a regulatory framework for the distribution and management of the cannabis supply in Canada. It grants significant powers to a Cabinet designate to levy administrative monetary penalties on individuals who are in violation of various provisions. Significant restrictions will also be placed on marketing, branding, and advertising targeted at youth.
Additionally, new criminal penalties will be imposed on the illegal distribution or sale of marijuana outside of the regulated systems put in place by the provinces, possession over the 30 gram limit, or production of cannabis beyond the personal use limits. These penalties will range from modest tickets and fines for small infractions to up to 14 years in prison for more serious offences. Notably, the act of taking cannabis across Canada’s borders carries with it a penalty of up to 14 years in jail.
It will be up to the individual provinces to determine how cannabis will be distributed in their respective jurisdictions. Ontario has opted for a centralized government monopoly where cannabis will be sold through the Ontario Cannabis Store (“OCS”). Nova Scotia has put in place a similar government monopoly. In contrast, Manitoba plans to allow a cluster of four private companies to distribute cannabis. Similarly, each province and municipality will be entitled to restrict the consumption of cannabis on public property.
After 95 years of prohibition, insurance policies and practices have generally excluded anything to do with cannabis. It was only recently that some insurers have begun to include medical cannabis in their group benefit plans, despite medical cannabis having been legalized many years previous. Previously, losses arising from fires caused by growing cannabis were excluded as arising from criminal acts. With the legalization of home growing, questions remain as to whether failing to tell your insurer about your four cannabis plants would be sufficient to constitute a material change in risk. Certain independent adjusting firms are also rolling out specialized claims services for the cannabis industry in an effort to get ahead of the coming changes. Although the full impact of legalization remains to be seen, disputes involving coverage under home owner policies, reasonable medical expenses, and human resources practices will likely be quite common in the initial transition.
What happens when an auto insurer sends a policy termination notice to the named insured, but the named insured does not own the vehicle insured under the policy?
In Ontario (Minister of Finance) v. Traders General Insurance Co. (c.o.b. Aviva Traders) an individual was seriously injured as a passenger in a Hyundai motor vehicle owed by Peter Leonard. Peter Leonard’s spouse, Anne Leonard, had a policy with Traders that was terminated for non-payment of premiums prior to the accident. The Hyundai had been added to the policy a couple of years prior to the accident.
To cancel Anne Leonard’s policy, Traders had sent a termination notice by registered mail. It did not send a termination notice to Peter Leonard, and appeared to have no knowledge at the time of cancellation that he owned the Hyundai insured under the policy.
The injured party made a claim to the Fund for accident benefits and the Fund subsequently commenced a priority dispute with Traders, arguing – for a number of reasons – that the policy had been improperly cancelled and remained in force at the time of the accident.
The Superior Court sided with the Fund and held that Traders did not terminate the policy properly because it had failed to send the owner of the vehicle (Peter) a termination notice. The court stressed that owners must be properly identified at policy inception and thereafter, strict compliance with the statutory cancellation requirements is necessary, and insurers must notify named insureds of attempts to cancel a policy. The court held that under statutory condition 11, Traders could not validly cancel the policy unless it gave Peter Leonard fifteen days’ notice of the cancellation. Thus, the policy was not cancelled properly and the court ordered Traders to pay the Fund the amount of its accident benefits settlement with the injured person.
The Court of Appeal agreed with the Superior Court and dismissed the appeal. Among other things, the Court of Appeal held that Traders failed to comply with Statutory Condition 11 (1), which requires the notice to be given to “the insured”. In this case, Peter was an “insured” because he was the owner of the vehicle:
The policy that the appellant purported to terminate is an owner’s policy, which is defined in s. 1 of the Insurance Act as:
A motor vehicle liability policy insuring a person in respect of the ownership, use or occupation of an automobile owned by that person and within the description or definition thereof in the policy. [Emphasis added.]
It was never an issue in this case that before the purported termination, the policy was valid insurance that insured Peter Leonard as the owner of the insured vehicle.
Therefore, because the policy at issue was valid, and because it was an owner’s policy, the “insured” under that policy was Peter Leonard, the owner of the vehicles insured by the policy.
To summarize, the only issue was whether the notice of termination had the effect of terminating that policy. The notice was only sent to Anne Leonard, who was not the insured for the 1991 Hyundai vehicle because she did not own it. Because the notice of termination was not sent to the insured, as required by statutory condition 11(1), it was not effective to terminate the policy, and the trial judge made no error in so holding.
Traders should raise alarms for insurers who might not have done their due diligence when writing owners policies for people who might not have owned the vehicle being insured. This casereinforces the principle that auto insurers are held to extremely strict compliance standards when it comes to terminating an auto policy. The courts will not endorse a purported policy termination if the insurer failed to dot its I’s and cross it’s T’s.
Readers might recall the troubling decision in Echelon General Insurance Company v. Her Majesty the Queen, wherein the Superior Court held that an improperly terminated policy remains in full force and effect (in perpetuity) until the policy is terminated properly. Of course insurers rarely, if ever, revisit policies that have they have purported to terminate until a loss occurs, meaning that these improperly terminated policies can expose insurers to paying claims on policies that have not been generating any premiums for possibly many years.
To every insurer who writes auto policies, I ask: Do you know who owns the vehicles insured under your policies?
The recent Court of Queen’s Bench of Alberta appeal decision in Hache v. Western Edmonton Mall Property Inc. sheds some light on occupiers’ liability claims in Ontario. The Plaintiff brought a claim against West Edmonton Mall following an injury in a parking garage. The Mall brought a motion for summary judgment on the basis that the incident was not foreseeable which was dismissed by a Master. The Defendant appealed that decision. It is the first case which considered the Supreme Court of Canada’s decision in Rankin (Rankin’s Garage & Sales) v. J.J. (2018 SCC 19 (CanLII), which was released in May, 2018.
The Court noted that Dougherty v. A Clark Enterprises Ltd. (2015 ABQB 562 (CanLII)) set out a three part test to assess whether an occupier breached the standard of care under the Occupiers’ Liability Act (R.S.A. 2000, c. O.4) – (1) was the risk reasonably foreseeable; (2) did the Defendant breach the appropriate standard of care; and (3) did the visitor willingly accept the risk.
First, the Court considered whether it was reasonably foreseeable that a visitor to the Mall would walk down a vehicle entry and take a running leap over a 44.5 inch concrete wall. The Court found that it was not. The Court accepted the Mall’s argument and concluded, from an objective perspective, that the risk of a pedestrian jumping and falling off an entry ramp intended for sole use by vehicles – which did not include a pedestrian walkway – was not reasonably foreseeable by the occupier prior to the incident involving the Plaintiff.
Second, the Court considered whether the Mall breached the appropriate standard of care. In doing so, the Court noted that the standard was reasonableness; not perfection. The occupier did not need to remove every possible danger. The Court found that there was no evidence that, at the material time, the ramp was either defective or unsafe for use by visitors. The construction was in compliance with the applicable Building Code at the time it was built. While the Building Code had subsequently changed, the Court found that there was no evidence to support a finding that the Mall was required to upgrade the concrete walls in order to meet the requisite standard of care.
The Court also rejected the argument that the Mall should have foreseen the accident and installed warning signs. Where a danger was so obvious and apparent that anyone would be aware of it, there was no duty to warn.
Finally, the Court considered section 7 of the Occupiers’ Liability Act which provides that “[a]n occupier is not under an obligation to discharge the common duty of care to a visitor in respect of risks willingly accepted by the visitor.” The Court referenced Rankin which recognized that the duty of care was not eliminated where a person, who is on premises, was deemed to have “willingly assumed all risks.” Instead, in such circumstances, occupiers are held to a lower standard of care.
On this point, the Court found that the Plaintiff was deliberate and purposive in his decision to knowingly and voluntarily walk down the vehicle ramp and jump over the concrete wall of the entry ramp. Neither the entry ramp nor the concrete retaining walk constituted a “hidden danger.” Even if the Court accepted that the parkade ramps were regularly used by pedestrians to access the street, purposively jumping over the ramp’s concrete wall was “hardly the conventional way for using the ramp.” The Court concluded that the Plaintiff made a poor decision, with full knowledge of the danger inherent in this decision, to use the ramp in an unconventional manner. The Court concluded that it could only translate into one thing – the Plaintiff willingly accepted the risk inherent in his jump. The motion for summary judgment was granted.
In similar cases, it is important to lead evidence regarding the purpose of the area where the incident occurred. If the actions that lead to an injury fall outside of the anticipated behaviour of visitors, an occupier may be able to avoid a finding of liability.
What happens when a Certificate of Automobile Insurance specifies that the policy includes coverages under certain endorsements, when those endorsements never make it onto the policy?
The Certificate and OPCF Endorsements
Ontario’s standard automobile policy (OAP1) offers a number of forms and endorsements that FSCO approves.
One such form is the Certificate of Insurance, which is an approved form that sets out, among other things, the specific terms of coverages and endorsements that form part of the policy in question. Although the standard Certificate is approved by the Superintendent of Insurance, insurers are allowed to submit their own version of a Certificate for approval, something that many insurers do.
Meanwhile, two of many available endorsements to the auto policy are, as follows:
An OPCF 23A endorsement provides for payment to a lienholder in the event of damage to the vehicle.
An OPCF 5 endorsement allows the lessor to rent or lease automobile(s) to the lessee who has completed the Ontario Application for Automobile Insurance - Owner’s Form (OAF 1). The endorsement expressly allows a lessor to rent or lease a motor vehicle to a lessee who has its own auto insurance policy. It also provides the standard auto coverages to a lessee under the policy as if the lessee were the named insured.
In Coast Capital v. Old Republic, a trucking company named 62254641 Canada Inc. (“622”) leased a 2008 Peterbilt tractor from a third party. Old Republic issued a Certificate of Automobile Insurance to 622 that described that vehicle. The Certificate also included a box for describing lessors and lienholders. The box stated:
Lienholders (to whom loss may be jointly payable) (if applicable)
AS PER OPCF 23A FORMS
Lessor (if applicable)
AS PER OPCF 5 FORMS
On June 15, 2012, 622 leased two more tractors, this time from Coast Capital. Coast Capital had informed its insurance broker in writing that it wanted third party liability coverage in the minimum amount of $2,000,000, and indicated “The policy must contain an OPCF #5 Permission to Lease or Rent Endorsement.” This document was found in Old Republic’s underwriting file. However, there was no evidence as to when it received that document.
On July 5, 2012, Old Republic issued an OPCF 25 Change Form showing 622 as the insured, and listing the two new Peterbilt tractors. The new tractors were identified as automobiles 2 and 4. The policy change that was noted on the form indicates “Automobile added to policy (Auto No. 2 and 4)”. The OPCF 25 also listed Coast Capital as the lessor of vehicles 2 and 4. It also recited that “all other terms and conditions of the policy remain the same”.
Of note, the OPCF 25 listed other related Endorsements that were mentioned in the original Certificate but failed to mention the OPCF 23A or 5 forms.
On November 12, 2012, one of the 2009 leased Peterbilt tractors (auto 2 or 4) was involved in a motor vehicle accident. Old Republic denied liability coverage to Coast Capital, taking the position that the OPCF 5 was not part of the policy.
The application judge held that the policy included an OPCF 23A form but did not contain an OPCF 5 form. He held that the OPCF 5 was never part of the Certificate of Insurance or added by the OPCF 25 form.
The Court of Appeal allowed the appeal and found coverage for Coast Capital under the policy. At the start of its analysis, the Court held that coverage under the standard auto policy is defined by the Certificate of Insurance on any given policy
The Certificate in question was not on the default Certificate form approved by the Superintendent, but it was on a FSCO approved form that Old Republic had submitted for its use. The Court noted that Old Republic had added the phrase “AS PER OPCF 5 FORMS” to the original Certificate in this matter, but that the phrase was not included on Old Republic’s approved form. The Court held that if Old Republic added the reference to the OPCF 5 on the Certificate in this case, the Certificate must have intended to include coverage for lessors and lessees – even though the actual OPCF 5 form was not attached to this policy. Further, had Old Republic included the phrase “AS PER OPCF 5 FORMS” to its approved Certificate, it would mean that its usual practice was to insure both lessees and lessors (as the OPCF 5 would do). The court concluded that if there was any ambiguity, it was caused by Old Republic’s uses of an “unapproved altered standard form”, and it would have to bear the consequences of doing so.
The Court also held that this finding was consistent with the commercial realities of the transaction. It concluded:
I conclude that the OPCF 5 endorsement is part of the Certificate; the insurer intended to provide liability coverage to both the lessor and lessee. The OPCF 25 Change Form did not delete that coverage, but added new vehicles. Absent deletion of the OPCF 5 coverage, I conclude that Coast Capital is entitled to the benefit of that coverage. Old Republic’s insertion of the OPCF 5 language into the Certificate accords with the commercial reality of the transaction. Old Republic was providing automobile insurance to a trucking company’s fleet. The trucking company leased multiple vehicles, to the knowledge of the insurer. It makes commercial sense for the lessors who were financing the purchase of the vehicles to protect themselves from liability as the owners of those vehicles when they would have no control over the trucking company operations.
There is nothing in the Certificate that suggests that the liability coverage described in the policy is solely for the benefit of the lessee.
The major takeaway from this case is that the Certificate of Insurance governs coverage under the policy. If the Certificate references a particular Endorsement on the policy that is not necessarily attached to the policy, the Court will defer to the coverage specified on the actual Certificate used in the case to determine coverage.
Insurance companies that insure leased/rented vehicles – and leasing/rental companies that lease/rent vehicles to others -- should review their various Certificates on a case-by-case basis to make sure they contain the coverages that the parties intended to be covered.
The plaintiff was successful in his lawsuit against a speedway for injuries sustained while moving out of the way of a stock race car that came off its track. At the end of the seven-day trial in Belleville, the parties could not agree on costs.
In coming to its decision, the Court considered various issues, including the refusal of the defendant (i.e. the defendant’s insurer) to participate in mediation despite numerous proposals from the plaintiff for same.
The Court stated that while mediation was not mandatory for the jurisdiction, a party’s unreasonable refusal to mediate can attract an adverse costs award. The factors considered in such a determination include the nature of the dispute, the merits of the case, whether other methods of settlement have been attempted, whether the costs of mediation would be disproportionately high, whether mediation would delay a trial and whether the mediation had a reasonable prospect of success.
In this case, the Court found that the insurer took a “tough and uncompromising stance” in refusing mediation as, contrary to the insurer’s position, the facts of the case indicated that neither side had a strong position on liability. As such, the Court found that the defendant’s refusal to mediate deprived the parties of an opportunity to settle the case without the necessity for trial and without incurring substantial costs.
In practical terms, the Court would have awarded the plaintiff approximately $190,000 (plus HST) in costs but for the defendant’s unreasonable refusal to mediate, resulting in an award of $210,000 (plus HST).
This decision serves as a cautionary tale for those jurisdictions where mediation is not mandatory. In these jurisdictions, insurers should think long and hard before refusing to participate in a requested mediation as it may end up costing them in the end.
Shalini defends insurance claims covering all aspects of general insurance liability including motor vehicle accidents, occupiers’ liability, slip and falls, as well as accident benefits litigation and arbitration and priority and loss transfer disputes.