Giuliani v. Halton (Municipality), 2011 ONCA 812 (C.A.)
The Giuliani decision was released by the Court of Appeal on December 21, 2011. The plaintiff lost control of her vehicle when the road she was travelling on was covered with snow and ice. Approximately two centimetres of snow had fallen on the road which impacted and turned to ice.
The weather forecasts beginning the afternoon prior to the date of the accident indicated that snow would fall beginning the next morning. The trial judge found that the Town had ample time to schedule a person or crew to monitor the weather and road conditions and to place a maintenance crew on standby.
Salting operations did not begin until fifteen minutes after the accident occurred. It was not clear when the icy road conditions were first discovered. It was held that the Town “failed to inspect the roads when it ought to have known that an inspection was necessary to trigger the remedial steps necessary to maintain [the road in question]”.
The trial judge held that the defendants had complied with the Minimum Maintenance Standards (MMS) with respect to treating the icy roadway within the required time after becoming aware of its icy condition. However, the trial judge held that this was not a defence.
The Court of Appeal upheld the decision and held that sections 4 and 5 of the MMS do not establish minimum standards to address the accumulation of 2 centimetres of snow on a Class 2 roadway (they apply when there is a 5 cm accumulation), nor do they establish a minimum standard for the treatment of a highway before ice is formed and becomes an icy roadway. The Town was liable for failure to monitor the weather and the failure to deploy resources to prevent the road from becoming icy. Therefore, the analysis did not centre on the MMS as the MMS does not establish a minimum standard for the treatment of a highway before ice is formed and becomes icy.
The analysis turned to section 44(1) of the Municipal Act, 2001 requiring municipalities to take reasonable steps. The Court of Appeal agreed with the trial judge that reasonable steps were not taken with respect to monitoring the weather and lining crews up in advance.
This case raises the bar significantly with respect to what the courts require of municipalities to meet the reasonableness standard. It also takes away much of the certainty that was provided to municipalities by way of the MMS. An increased proactive approach to maintenance of roadways will be required.
̶ Kristen Dearlove, Student-at-Law
A weekly update of cases pertaining to the practice of insurance defence.
February 29, 2012
February 15, 2012
Court of Appeal - Striking a Jury Notice
There is an interesting recent Court of Appeal decision in which the court discusses the appropriateness of a jury notice where there is a significant pre-accident medical condition. In Placzek v Green, (January 26, 2012, Ontario Court of Appeal) the plaintiff was injured in a rear end collision. The plaintiff had suffered from "severe fibromyalgia" for many years before the accident. The defendant argued that, to the extent that the plaintiff's physical problems interfered with her life after the accident, both problems were attributable in whole or in the main to the serious pre-existing condition and not to the relatively minor accident involving the vehicle driven by the defendant.
The trial judge struck the jury at the outset of the trial and held that, with respect to damages, despite the plaintiff's prior physical problems, the injuries suffered as a result of the car accident had caused significant problems for the plaintiff. The trial judge awarded damages in the amount of $919,237.
The defendant appealed on the basis that the trial judge should not have discharged the jury and that she did not quantify the damages on the basis of a rational analysis of the evidence.
With respect to discharging the jury, the Court of Appeal pointed out that the decision to discharge a jury is a discretionary one and that the court will defer to the exercise of that discretion unless it is shown that it was exercised on a wrong principle or that the exercise in the circumstances can be properly characterized as arbitrary, capricious or unreasonable.
In this case, the trial judge dismissed the jury on the basis of the anticipated complexity of the evidence to come relevant to the damage assessment. The complexity arose out of the plaintiff's pre-existing medical condition and the need to determine the impact of that condition on the plaintiff's post accident medical condition. In addition, there was competing expert evidence relating to the plaintiff's lost income and loss of future income claims. The plaintiff was a self-employed realtor and there were several factual variables relevant to her lost income claims. Finally there was competing and somewhat complex medical, engineering and biomedical evidence.
The Court of Appeal acknowledged that the defendant had made a powerful argument in support of his position that this was not really a complicated case at all, but found that they were unable to describe the trial judge's characterization of the evidentiary complexity as arbitrary, capricious or unreasonable. The Court of Appeal acknowledged that other judges might have reached a different assessment of the complexity of the evidence and declined to strike the jury, but that is not a basis upon which the trial judge's exercise of her discretion can be interfered with.
Of interest, the Court of Appeal went on to discuss other factors which the trial judge thought supported the exercise of her discretion in favor of striking the jury. For example, the Court of Appeal was of the view that the manner in which some of the evidence might be put before the jury and the advantages or disadvantages that one side or the other might have as a consequence, is irrelevant to the decision as to whether the jury should be struck before the trial started. Also, concerns about the position taken by the defendant with respect to liability could not provide any basis for striking a jury.
However, because the trial judge made it clear in her reasons that she struck the jury because of the anticipated evidentiary complexity on matters relating to damages, errors in respect of other matters considered did not taint the exercise of the trial judge's discretion.
With respect to the second ground of appeal, the defendant argued that the trial judge did not attempt to quantify the damages based on a critical assessment of the evidence, but instead simply picked a point somewhere in the middle between the various scenarios advanced by the parties. The Court of Appeal gave short shrift to that argument which apparently did not have much basis in evidence.
This case should be of some concern to defendants who believe that their cases are best determined by a jury. In most injury cases, certainly most cases which proceed to trial, there are issues relating to pre-existing medical conditions and there are issues relating to the calculation of future lost income. We certainly hope that Courts will not develop the habit of striking juries on those types of cases.
- Colin Osterberg
The trial judge struck the jury at the outset of the trial and held that, with respect to damages, despite the plaintiff's prior physical problems, the injuries suffered as a result of the car accident had caused significant problems for the plaintiff. The trial judge awarded damages in the amount of $919,237.
The defendant appealed on the basis that the trial judge should not have discharged the jury and that she did not quantify the damages on the basis of a rational analysis of the evidence.
With respect to discharging the jury, the Court of Appeal pointed out that the decision to discharge a jury is a discretionary one and that the court will defer to the exercise of that discretion unless it is shown that it was exercised on a wrong principle or that the exercise in the circumstances can be properly characterized as arbitrary, capricious or unreasonable.
In this case, the trial judge dismissed the jury on the basis of the anticipated complexity of the evidence to come relevant to the damage assessment. The complexity arose out of the plaintiff's pre-existing medical condition and the need to determine the impact of that condition on the plaintiff's post accident medical condition. In addition, there was competing expert evidence relating to the plaintiff's lost income and loss of future income claims. The plaintiff was a self-employed realtor and there were several factual variables relevant to her lost income claims. Finally there was competing and somewhat complex medical, engineering and biomedical evidence.
The Court of Appeal acknowledged that the defendant had made a powerful argument in support of his position that this was not really a complicated case at all, but found that they were unable to describe the trial judge's characterization of the evidentiary complexity as arbitrary, capricious or unreasonable. The Court of Appeal acknowledged that other judges might have reached a different assessment of the complexity of the evidence and declined to strike the jury, but that is not a basis upon which the trial judge's exercise of her discretion can be interfered with.
Of interest, the Court of Appeal went on to discuss other factors which the trial judge thought supported the exercise of her discretion in favor of striking the jury. For example, the Court of Appeal was of the view that the manner in which some of the evidence might be put before the jury and the advantages or disadvantages that one side or the other might have as a consequence, is irrelevant to the decision as to whether the jury should be struck before the trial started. Also, concerns about the position taken by the defendant with respect to liability could not provide any basis for striking a jury.
However, because the trial judge made it clear in her reasons that she struck the jury because of the anticipated evidentiary complexity on matters relating to damages, errors in respect of other matters considered did not taint the exercise of the trial judge's discretion.
With respect to the second ground of appeal, the defendant argued that the trial judge did not attempt to quantify the damages based on a critical assessment of the evidence, but instead simply picked a point somewhere in the middle between the various scenarios advanced by the parties. The Court of Appeal gave short shrift to that argument which apparently did not have much basis in evidence.
This case should be of some concern to defendants who believe that their cases are best determined by a jury. In most injury cases, certainly most cases which proceed to trial, there are issues relating to pre-existing medical conditions and there are issues relating to the calculation of future lost income. We certainly hope that Courts will not develop the habit of striking juries on those types of cases.
- Colin Osterberg
February 8, 2012
Loss Transfer - Costs of Assessments
In Wawanesa v. Axa (2012), 107 O.R. (3d) 395 (S.C.J.), the issue was whether the cost of s. 42 assessments are recoverable in loss transfer, particularly in light of the legislative changes that came into effect March 1, 2006 (when DACs were eliminated). The underlying accidents occurred on August 21, 2006 and October 6, 2005.
The arbitrator held that the cost of s. 42 assessments are not recoverable under loss transfer. Justice Greer upheld the decision. The legislative changes had no impact on the principle that assessment expenses are not recoverable in loss transfer.
The arbitrator held that the cost of s. 42 assessments are not recoverable under loss transfer. Justice Greer upheld the decision. The legislative changes had no impact on the principle that assessment expenses are not recoverable in loss transfer.
February 1, 2012
Interpretation of the Insurance Contract – Back to the Basics
In Sam’s Auto Wrecking Co. (c.o.b. Wentworth Metal) v. Lombard General Insurance Co. of Canada (S.C.J.), the Operations Manager of Sam’s Auto, Mr. Farber, was injured on the job when he was run over by a crane being operated by an employee, resulting in the severance of his right leg between the ankle and knee and a serious cut to his left heel.
Mr. Farber was not an owner but was considered to be a part of the management team at Sam’s Auto. Prior to the incident, the owners had decided to opt out of WSIB insurance for themselves and Mr. Farber, for economic reasons. They purchased alternative disability insurance. However, they were left with a gap in coverage for which they were unaware.
When they approached the broker for Lombard to acquire a comprehensive business policy, they did not advise him that not everyone at their company had WSIB coverage. They obtained a comprehensive business insurance policy through Lombard which included commercial general liability. Because no one was aware of the gap in coverage, an employer’s liability endorsement was not requested.
Following the incident, Mr. Farber sued Sam’s Auto. Lombard took an off coverage position and consequently would not provide a
defence. As a result, this action was commenced.
The issue before the court was whether the personal injury experienced by Mr. Farber, due to the actions of an employee at Sam’s Auto, operating within the scope of his employment, was or should have been covered by the insurance policy Sam’s Auto had through Lombard.
Justice Whitten used basic contract interpretation principles in his interpretation of the insurance policy:
1) The contra proferentem rule;
2) The principle that coverage provisions should be construed broadly and exclusion clauses narrowly; and
3) The desirability, at least where the policy is ambiguous, of giving effect to the reasonable expectation of the parties.
Justice Whitten cited the principle from Bathurst Ltd. V. Mutual Boiler and Machinery Insurance Company [1980] 1SCR 888 that the “objective is to search for an interpretation which from the whole of the contract would appear to promote or advance the true intent of the parties at the time of entry into the contract.”
Justice Whitten listed factors to consider, in an insurance context, to determine the intent of the parties at the time of entry into the contract:
1) What was the nature of the business operated by the potential insured?
2) Was there an independent insurance contractor involved? Or was the insurance solicited direct from the insurance company?
3) If a broker was involved, what was requested or communicated to the broker?
4) What was the broker’s understanding of what was communicated to him or her that guided the request for coverage from the insurer?
5) What was the broker’s understanding or knowledge as to the appropriate insurance coverage?
The policy stated: "We will pay those sums that the insured becomes legally obligated to pay as compensatory damages because of “bodily injury” to which this insurance applies...This insurance does not apply to … (d) “Bodily Injury” to an employee of the insured arising out of and in the course of employment by the insured".
Justice Whitten held that there was no ambiguity with respect to these sections and it was clear that personal injury to the public was covered but personal injury to an employee working in the course of his or her employment was exempt. Given the nature and size of the business, the broker was reasonable in assuming that all employees were covered by WSIB, and was not told any different. Therefore, the broker would not have been aware of the gap in coverage.
There were arguments advanced with respect to whether Mr. Farber would be considered an “employee” because of the management position he held. Justice Whitten held that the distinction between the terms “employee” and “executive officer” is purely “academic”, and had no bearing in this context.
It was held that there was a clear lack of coverage and therefore no duty to defend existed.
- Kristen Dearlove, Student-at-Law
Mr. Farber was not an owner but was considered to be a part of the management team at Sam’s Auto. Prior to the incident, the owners had decided to opt out of WSIB insurance for themselves and Mr. Farber, for economic reasons. They purchased alternative disability insurance. However, they were left with a gap in coverage for which they were unaware.
When they approached the broker for Lombard to acquire a comprehensive business policy, they did not advise him that not everyone at their company had WSIB coverage. They obtained a comprehensive business insurance policy through Lombard which included commercial general liability. Because no one was aware of the gap in coverage, an employer’s liability endorsement was not requested.
Following the incident, Mr. Farber sued Sam’s Auto. Lombard took an off coverage position and consequently would not provide a
defence. As a result, this action was commenced.
The issue before the court was whether the personal injury experienced by Mr. Farber, due to the actions of an employee at Sam’s Auto, operating within the scope of his employment, was or should have been covered by the insurance policy Sam’s Auto had through Lombard.
Justice Whitten used basic contract interpretation principles in his interpretation of the insurance policy:
1) The contra proferentem rule;
2) The principle that coverage provisions should be construed broadly and exclusion clauses narrowly; and
3) The desirability, at least where the policy is ambiguous, of giving effect to the reasonable expectation of the parties.
Justice Whitten cited the principle from Bathurst Ltd. V. Mutual Boiler and Machinery Insurance Company [1980] 1SCR 888 that the “objective is to search for an interpretation which from the whole of the contract would appear to promote or advance the true intent of the parties at the time of entry into the contract.”
Justice Whitten listed factors to consider, in an insurance context, to determine the intent of the parties at the time of entry into the contract:
1) What was the nature of the business operated by the potential insured?
2) Was there an independent insurance contractor involved? Or was the insurance solicited direct from the insurance company?
3) If a broker was involved, what was requested or communicated to the broker?
4) What was the broker’s understanding of what was communicated to him or her that guided the request for coverage from the insurer?
5) What was the broker’s understanding or knowledge as to the appropriate insurance coverage?
The policy stated: "We will pay those sums that the insured becomes legally obligated to pay as compensatory damages because of “bodily injury” to which this insurance applies...This insurance does not apply to … (d) “Bodily Injury” to an employee of the insured arising out of and in the course of employment by the insured".
Justice Whitten held that there was no ambiguity with respect to these sections and it was clear that personal injury to the public was covered but personal injury to an employee working in the course of his or her employment was exempt. Given the nature and size of the business, the broker was reasonable in assuming that all employees were covered by WSIB, and was not told any different. Therefore, the broker would not have been aware of the gap in coverage.
There were arguments advanced with respect to whether Mr. Farber would be considered an “employee” because of the management position he held. Justice Whitten held that the distinction between the terms “employee” and “executive officer” is purely “academic”, and had no bearing in this context.
It was held that there was a clear lack of coverage and therefore no duty to defend existed.
- Kristen Dearlove, Student-at-Law
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