Plaintiff entitled to coverage despite driving with expired licence

Sometimes even when you win, you lose.

We previously blogged on Kozel v. Personal Insurance Co.  A copy of our previous post is found here.  In that case, the respondent was in an accident while driving with an expired licence.  She claimed she received her licence renewal documents in the mail and gave them to a dealership when she took delivery of a new automobile.  The applications judge held that the insured exercised reasonable diligence and was entitled to a defence.  He also held that she was not entitled to relief from forfeiture because holding a valid licence is a condition precedent of the policy.

The Court of Appeal reversed the judge on the issue of due diligence but held that the respondent was entitled to relief from forfeiture.

The offence of driving without a valid licence is one of strict liability for which a defence of due diligence is available.  An individual can make out the defence if s/he can show a reasonable misapprehension of facts or reasonable care with respect to the offence with which she can charged.  The Court held that Ms. Kozel was not able to show she acted with reasonable care - although she had renewed her licence for 60 years on time, this time she did nothing else to inquire about or even consider her renewal.  There was no due diligence and the appeal was allowed on that issue.

However, the Court held that the plaintiff was entitled to relief from forfeiture.  The analysis looks at three factors: the applicant's conduct, the gravity of the breach and the disparity between the value of the property forfeited and the damage caused by the breach.  The Court held that Ms. Kozek acted in good faith and the breach was relatively minor.  In addition, the disparity was enormous as Kozek stood to lose $1,000,000 in insurance coverage while there was "no prejudice to the insurance company".  The Court held she was entitled to relief from forfeiture.

One has to wonder how much the specific facts of this case impacted the ultimate result: what if it wasn't a little old lady?  What if she had a history of driving with an expired licence?  What if the claim was for only $10,000?  It will be interesting to see how this case is applied to future fact situations.

Counsel Should Not Review Draft Expert Reports

A recent trial decision held that counsel should not review draft expert reports.  In Moore v. Getahun, 2014 ONSC 237 (S.C.J.), the plaintiff brought an action against an emergency room physician for negligently applying a cast after he fractured his wrist.

At trial, there were a number of evidentiary issues with respect to expert evidence, including whether it is appropriate for counsel to review draft expert reports and provide input?

Justice Wilson held that it was not proper for counsel to review an expert’s draft report.  If there are changes to a report, there should be disclosure to the other party:

[520]      The purpose of Rule 53.03 of the Rules of Civil Procedure is to ensure the independence and integrity of the expert witness. The expert’s primary duty is to the court. In light of this change in the role of the expert witness under the new rule, I conclude that counsel’s practice of reviewing draft reports should stop. There should be full disclosure in writing of any changes to an expert’s final report as a result of counsel’s corrections, suggestions, or clarifications, to ensure transparency in the process and to ensure that the expert witness is neutral.

Counsel should review the Moore decision as it potentially has repercussions for the way that counsel interact with experts in the future.  One has to wonder whether the Rule Committee intended r. 53 to be interpreted so broadly.

Claim for Contribution and Indemnity for Negligent Supervision Not Caught by Exclusion Clause

The Court of Appeal recently held that an insurer was obligated to defend a homeowner against a Third Party Claim alleging she failed to supervise her own daughter.


In Bawden v. Wawanesa Mutual Insurance Company, 2013 ONCA 717 (C.A.), eight year old Kelly Bawden was struck and injured by a motor vehicle driven by Joyce Wilson and owned by Randal Wilson in August 2003.

Kelly’s mother, Elizabeth Bawden, sued the Wilsons in her capacity as litigation guardian seeking damages on Kelly’s behalf. The Wilsons brought a third party claim against Elizabeth Bawden and Kelly’s father, David Bawden, claiming contribution and indemnity for failing to properly instruct and supervise their daughter.

The Bawdens held a homeowners’ insurance policy issued by Wawanesa Mutual Insurance Company. Wawanesa declined to defend them on the third party claim. The Bawdens brought an application for coverage. The application judge found in favour of the Bawdens. Wawanesa appealed to the Ontario Court of Appeal.

The critical coverage provision in the policy stated:

                You are insured for claims made or actions brought against you for:

1. personal Liability: bodily injury or property damage ­arising out of your personal activities anywhere in the world. [Emphasis added]

Exclusions: you are not insured for claims made or actions brought against you for…

1. bodily injury to you or to any person residing in your household other than a residence employee. [Emphasis added]

Wawanesa argued that the exclusion clause removed all claims for bodily injury by the insured and those residing in their household. The Court of Appeal disagreed and the appeal was dismissed. 

The Court held that the coverage provision must be interpreted broadly and therefore clearly encompasses the third party claim which arises out of the insureds’ personal activities in negligently failing to supervise their daughter. 

Further, the Court held that the exclusion clause must be read narrowly. It cannot encompass the third party claim which is not a claim on behalf of Kelly for her injury, but a claim by the Wilsons against the Bawdens for contribution and indemnity.

Lastly, the Court considered the policy objectives of the exclusion clause. The exclusion clause removes from coverage those claims that raise a risk of collusion between family members. This risk is not present in this case in which the Wilsons have brought a third party claim against the insureds. 

Limitations periods for claims of negligent supervision allowing sexual assaults to occur

Choc v. Hudbay Minerals Inc., [2013] O.J. No. 3375 (S.C.J.) is a case that may be of interest to institutional defendants of sexual assault claims.

In this action the plaintiffs, who are indigenous Mayan Q’eqchi’ from Guatemala, brought three related actions against the Canadian mining company, Hudbay Minerals and its subsidiaries.  The plaintiffs allege that security personnel working for Hudbay’s subsidiaries committed a number of abuses including a shooting, a killing and gang rapes during the forced removal of the plaintiffs from areas claimed as ancestral homelands.    

This decision is in respect of motions brought by the defendants, Hudbay Minerals, HMI Nickel and CGN with respect to three related actions by the plaintiffs.  One motion sought the dismissal of one of the actions on the basis that it was statute-barred by the Limitations Act, 2002, S.O. 2002, c. 24, Sched. B [“Limitations Act”].  The action sought to be dismissed was brought by 11 women who asserted they were each gang-raped by mining company security personnel during their forced removal on January 17, 2007.  The action was not commenced until March 28, 2011, more than 4 years later.

The defendants argue that the basic limitation period, of two years after the day on which the claim is discovered, pursuant to section 4 of the Limitations Act, is applicable.  The defendants contend that the plaintiffs’ claim is not based on assault or sexual assault but is framed in negligence based on the alleged failure of Hudbay to supervise employees and agents of its subsidiaries.  They argue there is no issue of discoverability and the plaintiffs knew of the alleged claims as of January 17, 2007.   

The plaintiffs argue that section 10 of the Limitations Act which provides an exception to the two year limitation period for claims based on an assault or sexual assault is applicable.  If the claim falls within the scope of section 10, then the limitation period will not have started running because the plaintiffs will be presumed to have been incapable of commencing the proceeding, unless the contrary is proven. 

The motions judge held that section 10 was applicable in the circumstances of the case as the claim is based on alleged sexual assaults.  Although the claim was based in negligence for the defendants’ failure to properly supervise and train their personnel, ultimately, without the sexual assault there would not have been a claim.  The sexual assault was “the main ingredient of the cause of action of negligence”.  As such the claim properly fell within the scope of s. 10 of the Limitations Act.

Counsel should be aware that even if a claim is framed in negligence, the standard two year limitation period may not apply.  Rather, the offence giving rise to the action may put the claim into one of the exceptions.

The Test for Determining Implied Consent to Use a Motor Vehicle

In Myers-Gordon(Litigation guardian of) v. Martin, 2013 ONSC 5441 (S.C.J.), the defendant’s son drove his mother’s  car while impaired and was involved in an accident, killing two pedestrians and injuring two others. Claims were brought against the defendant’s mother, Karen Martin. The parties agreed that the Ms. Martin had not given her son express consent to use her vehicle. The issue before the court on this motion for summary judgement was whether Ms. Martin had given her son implied consent to take her vehicle.

Justice Kent relied on the 2008 decision in Seegmiller v. Langer [2008] O.J. No. 4060 where 8 principles were considered to determine if there was implied consent:

1. Whether a motor vehicle is in possession of some person without the consent of the owner is a question of fact determined on the evidence.
2. The meaning of possession is a question of law, applying this definition is not a question of law alone.
3. Generally, possession means power, control or dominion over property
4. Once ownership is established, the onus passes to the owner to establish that another was in possession without consent.
5. The owner’s vicarious liability is based on possession, not operation.
6. Consent to possession is not synonymous with consent to operate.
7. If possession is given, the owner will be liable despite a breach of a condition attached to possession, including that the person in possession not operate the vehicle.
8. Breach of the owner’s conditions, does not alter the fact of possession.

Justice Kent considered the above factors and found no implied consent despite the fact that the son had driven the vehicle with permission numerous times in the past, Ms. Martin left the keys at home where they were accessible to her son and Ms. Martin had not brought up the issue (with her son or the police) that her vehicle was taken without consent until a significant time after the accident. The actions were dismissed against Ms. Martin due to Justice Kent’s confidence in the son’s evidence that he never thought he had consent to possess or drive the vehicle.

Consent is fact-driven and the eight-fold test provides a useful framework in which to work. 

Supreme Court Sets Out The Test for Summary Judgment

The Supreme Court has overturned the "full appreciation" test used by the Ontario Court of Appeal in summary judgment.  The appeals in Hryniak v. Maudlin, 2014 SCC 7 and Bruno Appliance and Furniture v. Hryniak, 2014 SCC 8 were released January 23, 2014.


The Court emphasized that summary judgment rules must be interpreted broadly, "favouring proportionality and fair access to the affordable, timely and just adjudication of claims".  The new Rule 20 represents a significant alternative model of adjudication.


There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment.  This will be the case when the process:



(1)  Allows the judge to make the necessary findings of fact;
(2)  Allows the judge to apply the law to the facts, and
(3)  Is a more proportionate, more expeditious and less expensive means to achieve a just result (para. 49).




The standard for fairness is whether it gives the judge confidence s/he can find the necessary facts and apply the relevant legal principles so as to resolve the dispute. The evidence need not be equivalent to a trial.  The Court held that a documentary record, particularly when supplemented with the new fact-finding tools such as oral testimony, is often enough to resolve material issues justly and fairly (para. 57). The judge may need to compare things such as the cost and speed of a trial versus summary judgment.




At para. 66, the Court set out a roadmap for summary judgment:




There will be no genuine issue requiring a trial if the summary judgment process provides her with the evidence required to fairly and justly adjudicate the dispute and is a timely, affordable and proportionate procedure, under Rule 20.04(2)(a).  If there appears to be a genuine issue requiring a trial, she should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2).  She may, at her discretion, use those powers, provided that their use is not against the interest of justice.  Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.




The Supreme Court's interpretation of r. 20 seems to be a firm statement that summary judgment is an appropriate way to resolve cases, rather than the restrictive interpretation taken by the lower courts.  We may see an increase in the number of summary judgment motions in the future.

The Limitation Period in False Arrest/Imprisonment Cases

A recent decision looks at when the limitation period begins to run in a false arrest/false imprisonment case, as well as the impact of a peace bond on a negligent investigation claim.

In E.B.F. (Litigation guardian of) v. Ontario, 2013 ONSC 2581 (S.C.J.), the plaintiff sued the Crown for false arrest, false imprisonment, breach of Charter rights and negligent investigation arising out of charges laid against him by the O.P.P in 2008.  The plaintiff's daughter alleged he had sexually assaulted her.  The charges were ultimately withdrawn in 2009 after the plaintiff agreed to enter into a peace bond.  The claim was issued in 2011.  The Crown brought a motion to strike the claim.  There were two issues for the Court to consider:

1.  Whether the limitation period began when the plaintiff was arrested or when the peace bond was entered into; and
2.  Whether the peace bond represented the charges being terminated in the plaintiff's favour, a precondition to being able to pursue a negligent investigation claim.

Justice Chiappetta held there was no reasonable cause of action against the Crown.  A claim for false arrest, false imprisonment or breach of Charter rights crystallizes on the date of arrest.  Although the plaintiff alleged he was unable to determine the arrest was wrongful until after receiving legal advice and the results of a private investigation, there was no persuasive evidence that the plaintiff suffered from any mental or psychiatric disorder that would have impacted his ability to understand the arrest, the charges and his belief of innocence.

The plaintiff argued that since the only conditions imposed by the peace bond were to keep the peace and be of good behaviour (as every other citizen is required to do), the proceedings terminated in his favour.  Justice Chiappetta held that the agreement to withdraw the charges in return for a peace bond represented a negotiated compromise, and was not a termination of proceedings in the plaintiff's favour.

Since the plaintiff's claim was issued beyond the limitation period and he failed to show the proceedings were terminated in his favour, the claim was dismissed.