Law Times

www.lawtimesnews.com Page 10 January14, 2008 / Law Times Highway Traffic Act vicarious liability provisions Flow of cases won't end soon "O n several occa- sions over the last few years," writes Justice Marc Rosenberg of the Ontario Court of Appeal in the opening paragraph of his rea- sons for a unanimous court in Henwood v. Coburn, "this court has been asked to deal with the vicarious liability provisions of s. 192 of the Highway Traffic Act, R.S.O. 1990, c. H.8." No kidding. In interpreting s.192(2), which makes vehicle owners li- able for damages caused by neg- ligence in the vehicle's operation unless the vehicle "was without the owner's consent in the pos- session of some person other than the owner or the owner's chauffeur," the difficulties never seem to cease. And if the reactions of two of the lawyers on the case — who appear to have diametrically op- posing views of Henwood's im- pact on the jurisprudence — are any indication, the flow of cases won't be ending anytime soon. Rodney Dale of Lerners LLP's London, Ont. office, who rep- resents the defendant, Ontario Car and Truck Rentals, says the precedent set by Henwood is sig- nificant. "The case redefines the con- cept of possession and therefore the issue of consent, as well as clarifying the previous jurispru- dence," he says. But Sandi Smith of Toronto's Gilbert Wright & Kirby, who represents the defendant, Pem- bridge Insurance Co. differs. "The facts of this case are weird and unusual," she says. "In the grand scheme of the law, the Court of Appeal did no more than say [those facts] needed to be fleshed out at a proper trial." The plaintiff, Peter Henwood, sold frozen meat door to door. He bought his supplies from a company owned by George Fitzgerald. On June 30, 2000, Fitzgerald rented a car for Henwood from Ontario Car and Truck after Henwood's truck broke down. The rental agreement showed Fitzgerald as the renter and Hen- wood as the driver. Fitzgerald asked Henwood to take the defendant, Frederick Coburn, who had no driver's li- cence and no car insurance, along on his sales trip. Henwood and Coburn went to a tavern for a few drinks after work. Coburn became drunk and belligerent and wanted Hen- wood to take him home, which was well out of Henwood's way. Henwood, who had also been drinking but was planning to walk home, refused. So Coburn punched him in the face, took the keys to the truck, jumped in, and started to drive away. Hen- wood managed to get into the passenger side with the intention of talking Coburn out of going to Barrie, where he lived. He was also concerned about $5,000 worth of meat that was still in the truck. When Coburn failed to navi- gate a turn, the truck left the road and crashed into a field. Hen- wood was injured. He sued Co- burn, Ontario Car, and his own insurer, Pembridge Insurance Co., under his uninsured motor- ist coverage. The minister of finance de- fended Coburn for the purpose of preventing any payment from the Motor Vehicle Accident Claims Fund. Ontario Car and Pembridge sought dismissal of the action, by way of summary judgment, on the basis that Coburn was driv- ing without consent. Superior Court Justice Barry MacDougall found that Hen- wood "continued to assert pos- session of the vehicle notwith- standing that he had a disagree- ment with Coburn about their destination." In other words, although Co- burn was driving, Henwood was still in possession. And, since Henwood was in such possession with the consent of the owner, Ontario Car was vicariously li- able. On appeal, Dale argued that Coburn was in possession of the vehicle without Henwood's con- sent, warranting a dismissal of the action against Ontario Car. Alternatively, he submitted that there were genuine issues relating to vicarious liability that should be resolved at trial. As Rosenberg saw it, the ma- jority's ruling in Thompson v. Bourchier, a 1933 decision of the Ontario Court of Appeal, was decisive. Thompson decided that an owner was vicariously liable where the person to whom the owner entrusted possession was in possession, even if that person was not actually driving. "Cases applying Thompson have made it clear that the fact that the driver may be operating the vehicle without the consent of the owner, or even contrary to the express wishes of the owner, is irrelevant, provided that the person to whom the owner en- trusted the vehicle is in posses- sion of the vehicle, albeit as a passenger," Rosenberg noted. But Dale argued that there were some cases in which the Court of Appeal had followed the dissent in Thompson. The dissent had concluded that the person actually operating the vehicle was the only person in possession. Rosenberg was not swayed. "I can see no basis for not fol- lowing or applying [the decision of the majority in Thompson] in this case," Rosenberg wrote, add- ing that the cases cited by Dale were consistent with the Thomp- son majority, because the person with consent was not in posses- sion, although he was physically present in the vehicle. "To summarize, the mere fact that someone, here Coburn, is operating the vehicle without the owner's consent is not determina- tive of the owner's liability under s. 192," Rosenberg said. "If some- one, such as Henwood in this case, is found to be in possession, and that person has the owner's consent, the owner will be liable even if the person in possession is only a passenger." "Accordingly, [Ontario Car and Truck] was not entitled to summary judgment in its fa- vour." This did not mean, however, that the plaintiff Henwood was entitled to summary judgment. As Rosenberg saw it, Hen- wood's presence did not in itself give him possession of the truck. Whether Henwood was in pos- session was open to dispute, and trial was the proper forum for resolution of that dispute after presentation of the relevant evi- dence on both sides. "Henwood may or may not have been asserting his right to pos- session, but that did not mean that he was necessarily in possession," Rosenberg wrote. "Asserting a right to possession and possession are not the same thing." For his part, Dale insists that Rosenberg's reasons reconcile, once and for all, the two lines of cases that followed from the split decision in Thompson. If Dale's right, s. 192 cases should abate. Only time will tell. FOCUS Good Faith in Canadian Insurance Law is a new looseleaf service that will help give practitioners and insurance professionals the information they need when dealing with bad faith claims in insurance law. 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