Top 5 Tort Cases -2014 in Review was originally presented at The Oatley McLeish Guide to Motor Vehicle Litigation 2015 Conference on March 26, 2015.
- Fordham v Dutton-Dunwich (Municipality) 2012, ONSC 6739, 2014 ONCA 891
- Bondy v London, 2013 ONSC 1218, 2014 ONCA 291
- Kandavanam Maria-Antony v Sritaran Selliah, 2007 ONWSIAT 615, 2014 ONSC 4264
- Xu v Mitsui Sumitomo Insurance Company Limited, 2014 ONSC 167, 2014 ONCA 8051
- Mallory v Werkmann Estate, 2014 ONSC 971, 2015 ONCA 71
1. Fordham v Dutton-Dunwich (Municipality) 2012, ONSC 6739, 2014 ONCA 891
The plaintiff ran a stop sign at 80 km/h on a rural road and then was unable to negotiate a small S curve just beyond the stop sign. The plaintiff lost control of his vehicle and crashed into a concrete bridge suffering serious personal injuries. There was evidence at trial that the S curve was not properly signed and that rural drivers did not always stop for stop signs in and around these types of areas. There was also expert evidence that if the plaintiff had stopped at the stop sign, then he would have been able to negotiate the S curve.
Superior Court of Justice Decision:
Justice Morissette concluded that the degree of fault ought to be shared equally between the plaintiff and municipality. The plaintiff’s negligence was a causal factor to the extent of 50% because if he had stopped at the stop sign this crash would not have happened. Recognizing that the failure to stop at the stop sign was part of the “ordinary rural” driver’s behavior in this area, Justice Morissette held that if there was warning signs that the hazard was ahead, then the plaintiff likely would not have been injured, even if he had not stopped at the stop sign.
Court of Appeal Decision:
Although the Court of Appeal found some support for the proposition that not all rural drivers in this area stopped for stop signs, Laskin J.A., speaking for the Court, noted that there was no credible evidence that local drivers went through stop signs at the speed limit. More importantly, the Court held that even if there had been such evidence this was legally irrelevant. There is not one standard for city drivers and another standard for rural drivers. A municipality’s duty does not extend to making its roads safe for negligent drivers. A municipality need only erect signs if failing to do so would expose an ordinary driver exercising reasonable care to an unreasonable risk of harm.
2. Bondy v London, 2013 ONSC 1218, 2014 ONCA 291
The Plaintiff fell on the bottom of an icy sloped residential driveway that was located between the sidewalk and the road (“the Boulevard”). The Plaintiff sued both the homeowner, under the Occupier’s Liability Act and the City of London under section 44(1) of the Municipal Act. Section 44(1) provides that “the municipality that has jurisdiction over a highway or bridge shall keep it in a state of repair that is reasonable in the circumstances, including the character and location of the highway or bridge”.
Superior Court of Justice Decision:
The Boulevard was classified as a highway within the Municipal Act. Under s. 44(1) of the Municipal Act, the City had a statutory duty to keep the boulevard in a state of repair that was reasonable in the circumstances. There was no By-law that imposed a duty upon the homeowner to remove snow and ice from the Boulevard in front of her home. Even if there had been such a bylaw, it would not relieve the City from liability imposed on it by the Municipal Act. The homeowner was not liable for maintenance of the boulevard as an adjacent property owner under the Occupier’s Liability Act because she did not exercise any control over the Boulevard. The City met the minimum requirements contained in the Regulations. Plows were dispatched to clear the snow from the streets within the required time; but whether the plow operators would have salted the Boulevard portion was unknown and not relevant to make a finding of liability.
Court of Appeal Decision:
The Plaintiff appealed and it was dismissed. The primary issue on appeal was whether a municipality’s standard of care for road maintenance was elevated due to pedestrian traffic. The City acknowledged that the Boulevard was a highway, within the meaning of the Municipal Act; however, as a highway, the City argued that the Boulevard must be maintained to a standard for use by vehicles, not as a passageway for pedestrians.
The Court of Appeal held that people crossing at undesignated places on a road does not create or impose a “special circumstance”, which would require the Municipality to maintain the Boulevard at a higher level. In this case, the pavement had become slippery because of an ice storm and the City’s response was considered adequate.
3. Kandavanam Maria-Antony v Sritaran Selliah, 2007 ONWSIAT 615, 2014 ONSC 4264
Maria-Antony and Selliah worked as transport truck drivers for 1362038 Ontario Ltd. (136), contracted to transport cargo for 1323109 Ontario Ltd. (132). The transport truck that they operated was owned by Financial Transport Inc. (FTI), but leased to 136 for its exclusive use in its business operations during the term of the lease. On October 5, 2000, Selliah was driving the transport truck and Maria-Antony was asleep in the sleeper compartment, when they were involved in a serious single vehicle motor vehicle accident. A civil action was brought by Maria-Antony against Selliah, 136, 132 and FTI. Subsequently, an application was made to the Workplace Safety and Insurance Appeals Tribunal for a determination that the civil action was barred, pursuant to section 28 of the Workplace Safety and Insurance Act on the basis that all parties were either employees or employers, working in the course of their employment.
The Tribunal issued a decision that Maria-Antony’s right to sue the defendants Selliah, 136, and 132 was barred by the provisions of section 28 of the Workplace Safety and Insurance Act on the basis that Selliah and Maria-Anthony were employees of 136,132, working in the course of their employment and thus “protected” defendants under the Act. The Tribunal determined that FTI was not an employer in relation to either Selliah or Maria-Antony and concluded that the right of action against FTI was not barred pursuant to s. 28(4) of the Act. The tribunal concluded that immunity under the Act did not apply to FTI because it was “an employer other than the worker’s employer that supplied a motor vehicle … on purchase or rental basis without also supplying workers to operate the motor vehicle.” The Tribunal also stated that the plaintiffs had “a limited right of action against Financial Transport” pursuant to s. 29 (4) of the Act without expanding on what was meant by a “limited” right of action.
Section 29 of the Act reads as follows:
Liability where negligence, fault
29. (1)This section applies in the following circumstances:
1. In an action by or on behalf of a worker employed by a Schedule 1 employer or a survivor of such a worker, any Schedule 1 employer or a director, executive officer or another worker employed by a Schedule 1 employer is determined to be at fault or negligent in respect of the accident or the disease that gives rise to the worker’s entitlement to benefits under the insurance plan.
(2) The employer, director, executive officer or other worker is not liable to pay damages to the worker or his or her survivors or to contribute to or indemnify another person who is liable to pay such damages.
Determination of fault
(3) The court shall determine what portion of the loss or damage was caused by the fault or negligence of the employer, director, executive officer or other worker and shall do so whether or not he, she or it is a party to the action.
(4) No damages, contribution or indemnity for the amount determined under subsection (3) to be caused by a person described in that subsection is recoverable in an action. 1997, c. 16, Sched. A, s. 29.
Superior Court of Justice Decision:
After the WSIAT decision was released, FTI brought a motion for summary judgment to dismiss the plaintiffs’ civil action against it for personal injury and Family Law Act damages. The plaintiffs opposed the motion on the basis that while any action against the driver, Selliah, and the defendants, 136 and 132 was statute barred by operation of the Act, section 192 of the Highway Traffic Act imposes vicarious liability on the vehicle owner, FTI, for Selliah’s negligence.
Justice A.J. O’Marra dismissed the motion for summary judgment and provided the following reasons in support of his decision:
 Where the legislature intends to remove or restrict a right, such as confining liability to personal negligence and to exclude vicarious liability, “the Legislature knows how to do it”. To remove a right it must do so in clear and unambiguous term. (See 583809 Ontario Ltd. v. Kay, 1995 CanLII 7080 (ON SC),  O.J. No. 1626, at para 13)
 Contrary to the obiter dicta in Ling v. TransAmerica, because s. 29 does not specifically restrict or remove statutorily available vicarious liability claims, such actions must remain actionable.
 The purpose of the provision at issue is to eliminate joint liability between protected and unprotected defendants that would otherwise exist, not to eliminate an unprotected defendant’s vicarious liability. It is to ensure protected defendants are not subject to liability in court by eliminating the principal of joint and several liability with unprotected defendants, and by precluding the unprotected defendant from recovering contribution or indemnity from the protected defendants for their negligence.
 In summary, the provision does not specifically preclude the vicarious liability of the unprotected owner of the vehicle where indemnity against the negligent tortfeasor is barred by operation of the Act. The limited right of action cited by the Appeals Tribunal includes actions based on vicarious liability.
4. Xu v Mitsui Sumitomo Insurance Company Limited, 2014 ONSC 167, 2014 ONCA 8051
On March 1, 2006, the provincial government introduced Bill 18. It provided for, amongst other things, amendments to the Insurance Act, R.S.O. 1990, c. I.8 and the Highway Traffic Act, R.S.O. 1990, c. H.8. Specifically, s. 267.12 of the Insurance Act was amended to limit the liability of automobile lessors, in certain circumstances, to $1,000,000. The section did not mention the liability of lessees.
On June 20, 2006, the applicant Jie Jay Xu suffered serious personal injuries as a passenger in a motor vehicle leased and operated by Jianhua Lu. Mr. Lu leased the vehicle from its owner, Toyota Credit Canada Inc. They collided with a motor vehicle operated by Josephine Tui. Mr. Lu and Ms. Tui’s insurers offered to tender their policy limits of $1,000,000.
On January 1, 2008, the Superintendent of Financial Services approved the O.E.F. 110 endorsement. It is to be attached to the Standard Excess Policy Form No. 7. The O.E.F. 110 states that the lessor’s policy restricts coverage of the lessee or driver of the leased vehicle to $1,000,000, where necessary.
The issue on this application was whether Mr. Xu could access the lessor, Toyota Credit Canada’s, insurance policy of potentially $18,000,000 through Mr. Lu, who was the lessee. The applicants argued that between the implementation of Bill 18 and the approval of the O.E.F. 110, a “legislative gap” existed with respect to lessees and that the plain wording of s. 267.12 did not extend protection to lessees. During this “gap”, lessors were protected from exposure to claims over $1,000,000, but lessees did not enjoy the same protection, and were therefore insured under lessors’ policies. The applicants conceded that if the accident had occurred after the O.E.F. 110 was approved on January 1, 2008, Mr. Lu would have no insurance available to him through the lessor.
Superior Court of Justice Decision:
Justice McEwen found that s. 267.12 of the Insurance Act, precluded a lessee from coverage under a lessor’s insurance policy beyond the $1,000,000 for motor vehicle accidents that occurred after March 1, 2006.
… The intent of the Legislature derived from the Hansard excerpts and supported by the Superintendent’s bulletins, was to amend s. 267.12 to limit the liability of exposure of lessors and their insurers. This obviously could not be achieved if the insurers were liable vis a vis the lessees accessing the lessor’s insurance policies in cases such as this one, where Lu had insurance through Intact with third-party limits of $1 million. A fair, large and liberal interpretation that best ensures the attainment of s. 267.12’s object is to interpret it to preclude coverage to lessees under a lessors’ policy beyond the statutory limits contained in the Insurance Act.
In my view, my conclusion that s. 267.12 precludes lessees from accessing lessors’ insurance policies where the lessee has $1 million in coverage acts as a complete bar to Lu from accessing TCCI’s coverage with Mitsui. Section 267.12 commences with the words, “despite any other provisions in this Part”. This wording is designed to ensure that, notwithstanding any other section dealing with automobile insurance, including ss. 239 and 244, lessors’ liability will be capped at $1 million. The insertion of this wording, and the clarification provided by the O.E.F. 110, result in the proposition that Lu cannot be an unnamed insured under any Excess or Umbrella policies that could be held by TCCI.
In the event that Justice McEwen was wrong with respect to his conclusion regarding s. 267.12, he went on to discuss whether the individual lessor policies, as per their terms, would provide coverage to Mr. Lu as an unnamed insured and concluded that they did not.
Court of Appeal Decision: The Applicants appealed and it was dismissed. The Court of Appeal unanimously agreed with Justice McEwen with respect to s.267.12 of the Insurance Act and therefore, did not discuss whether the individual lessor policies, as per their terms, would provide coverage to Mr. Lu as an unnamed insured.
5. Mallory v Werkmann Estate, 2014 ONSC 971, 2015 ONCA 71
On February 6, 2005 the plaintiff, Robert Mallory was driving his vehicle westbound on Bloomington Road in Aurora when it was struck head-on by a motorcycle driven by Gabor Werkmann. As a consequence of the collision, Mr. Mallory was seriously injured; Mr. Mallory’s passenger and Mr. Werkmann were killed. At the time of the collision, Mr. Werkmann had been out for a motorcycle ride with the co-defendants Krisztian Nemes and Istvan Mihali, who were each operating their own motorcycles ahead of Mr. Werkmann. Mr. Werkmann was travelling at a high rate of speed, when he lost control of his motorcycle and crossed the centre line of Bloomington Road. After the collision, Mr. Mihali was charged and pleaded guilty to careless driving contrary to s. 130 of the Highway Traffic Act and Mr. Nemes was charged and pleaded guilty to dangerous driving under the Act. The following facts were read into the record as particulars of the offences for which Mr. Mihali and Mr. Nemes pleaded guilty:
At about three thirty in the afternoon on February 6, 2005, Mr. Nemes and Mr. Mihali with Mr. Werkmann gathered at Moore Park Avenue in Toronto. They had three high performance sport bikes. Mr. Werkmann affixed a camera to the inside of his motorcycle which captured both the speedometer and a portion of the road ahead. They set out and travelled north from Toronto into York Region. The route and manner of driving was captured on the camera affixed to the motorcycle that Mr. Werkmann was operating. During their 45 minutes of travel, Mr. Mihali, operating one motorcycle and Mr. Nemes, operating another motorcycle, reached very excessive speeds. The maximum speed reached at one point exceeded 240 kilometres per hour, and that was in an 80 kilometre per hour zone. There were many unsafe lane changes, passing in between moving motor vehicles. Each of Mr. Nemes and Mr. Mihali performed two wheelies, that is, bringing the front tire of the motorcycle off the ground while it was in motion, and these were at speeds of about 145 kilometres per hour and 155 kilometres per hour. Ultimately the trio was northbound on Kennedy Road in York Region, turned eastbound onto Bloomington Road and proceeded eastbound from that location. Both Mr. Mihali and Mr. Nemes continued from the location at a high rate of speed. Mr. Werkmann was some distance behind. Mr. Werkmann accelerated to a speed of about 180 kilometres per hour and ultimately lost control of the motorcycle, crossed into the westbound lane and collided with a westbound car. He died as a result of that collision as did a passenger in the vehicle. The evidence of the dangerous driving is captured on the video. There were a number of witnesses at that location at that time. After the collision, Mr. Nemes and Mr. Mihali were not in close proximity when that occurred. They ultimately returned. Mr. Nemes took off his helmet and had a conversation with one of the witnesses on scene. Mr. Mihali was identified to police. Crown counsel said that he did not allege that Mr. Mihali’s or Mr. Nemes’ actions caused or contributed to the deaths or impacted upon the occurrence. Mr. Mihali’s lawyer said that the plea was on that basis and was based on driving at an excessive rate of speed. The facts as read in were accepted by the presiding judge as the basis for the convictions.
The plaintiff sued to recover damages for negligence from the estate of Mr. Werkmann, as well as from Mr. Nemes and Mr. Mihali, alleging that they were in a joint venture together when the accident occurred. Mr. Werkmann did not have insurance. Eventually the claim and cross-claim against the estate were discontinued. The plaintiff’s insurer, Security National Insurance Company was added as a defendant in the action pursuant to section 265 of the Insurance Act R.S.O. 1990, C. I-8, for uninsured automobile coverage. The main issues that arose before Justice Lack were: 1) what weight, if any, should the Highway Traffic Act convictions against Mr. Nemes and Mr. Mihali be given in the civil trial against them; and 2) did the negligence of Mr. Nemes and Mr. Mihali cause or contribute to the plaintiff’s damages.
Superior Court of Justice Decision:
With respect to the Highway Traffic Act Convictions and Joint Ventures, Justice Lack held that the convictions for careless driving and dangerous driving meant that at the time of the offences, Mr. Mihali and Mr. Nemes drove their motorcycles on a highway without due care and attention or without reasonable consideration for other persons using the highway. Their convictions were prima facie proof of their unlawful acts and of the essential facts that support each conviction. The convictions and underlying facts, however, were not prima facie proof of a joint venture, although they were evidence to be considered on that issue. With respect to Causation and Joint Ventures, Justice Lack found that all three motorcyclists were engaged in a joint venture. She concluded that although Mr. Werkmann was the one who was involved in the collision, the negligence of Mr. Mihali and Mr. Nemes was also significant in causing it. Justice Lack found Mr. Mihali and Mr. Nemes were each 25% jointly and severally liable for the plaintiff’s damages and dismissed the claim against Security National Insurance Company on the basis that Mr. Mihali was insured at the time of the collision:
…the three cyclists were engaged in a joint venture to participate in activity that involved driving considerably in excess of the speed limit and breaking other rules of the road. They encouraged and incited one another to do so. Immediately before the collision Mr. Mihali’s action in pulling away at a high rate of speed from Mr. Werkmann implicitly incited Mr. Werkmann to drive at the speed he did in order to follow to Mr. Mihali’s home to get warm. In failing to remain at the scene of the accident, as anyone would whose friend had just been killed, the two cyclists left. I find that they did that because they were conscious of having been, in part, to blame for what had happened. The conduct of the trio in driving in the manner, in which they did, viewed objectively and subjectively, created a grave risk of death or injury to other users of the highway and the loss that Mr. Mallory suffered was within the ambit of that risk and was readily foreseeable by all of them.
Court of Appeal Decision:
The Defendant, Mihali is appealing the decision on 8 grounds, 6 of which are with respect to his liability. The appeal on those grounds has yet to be perfected. The 2 remaining grounds of Mr. Mihali’s appeal involved his insurance coverage.
Motion before Chief Justice Strathy:
Two motions were brought before Chief Justice of Ontario Strathy with respect to the grounds of appeal on Mihali’s insurance coverage. Security National moved to remove counsel acting for Mr. Mihali on the ground of a conflict of interest for raising coverage issues. Royal & Sun Alliance Insurance Company (“RSA”), Mr. Mihali’s insurer, moved to intervene as an added party to speak to the issues of insurance coverage at the appeal. Chief Justice of Ontario Strathy agreed there was now a conflict between the interests of Mr. Mihali and the interest of the insurer: “the inclusion of these grounds gives rise to the inescapable conclusion that defence counsel was acting on the instruction of the insurer to advance a ground of appeal contrary to the interest of the insured”. Mr. Mihili’s counsel and his firm were removed from representing him any further. Chief Justice of Ontario Strathy dismissed RSA’s motion to intervene to speak to coverage issues, in part because they provided no authority for an intervention in these circumstances and in part for their delay in dealing with the coverage issues so late in the proceedings.