Young v. Her Majesty the Queen in right of Ontario as represented by the Minister of Finance
[Indexed as: Young v. Ontario (Minister of Finance)]
68 O.R. (3d) 321
[2003] O.J. No. 4832
Docket No. C37845
Court of Appeal for Ontario
Carthy, MacPherson and Simmons JJ.A.
December 11, 2003
*Application for leave to appeal dismissed without costs May 13, 2004 (Iacobucci, Binnie and Arbour JJ.).
Insurance -- Automobile insurance -- Statutory accident benefits -- Plaintiff ordinarily resident in Ontario but living in New Mexico when seriously injured in motor vehicle accident -- Plaintiff's motor vehicle registered and insured in New Mexico -- Part VI of Insurance Act not applying to plaintiff or her vehicle as vehicle not required to be registered under Highway Traffic Act and her insurance policy did not have to comply with mandatory coverage provisions of Compulsory Automobile Insurance Act -- Plaintiff's policy not deemed by s. 268(1) of Act (in Part VI) to provide for statutory accident benefits -- Plaintiff not entitled to access Ontario Motor Vehicle Accident Claims Fund as entry to Fund is triggered pursuant to s. 6(1) of Motor Vehicle Accident Claims Act only if person has recourse against Fund for no-fault benefits under s. 268 of Insurance Act -- Insurance Act, R.S.O. 1990, c. I.8, s. 268 -- Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41, s. 6(1).
The plaintiff grew up and attended university in Ontario, but moved to New Mexico in 1995 to work as a veterinary nurse. She obtained a New Mexico driver's licence and owned a truck that was registered and insured in New Mexico. Her insurance provided third party liability coverage and uninsured motorist coverage. She elected not to obtain first party medical coverage, which was optional. The plaintiff was catastrophically injured in a single-vehicle accident when her truck flipped and rolled over. Her family arranged to have her returned to Toronto. She was without recourse against her insurer for the no-fault statutory benefits provided to persons injured in vehicle accidents in Ontario, as set out in the Statutory Accident Benefits Schedule -- Accidents after December 31, 1993 and before November 1, 1996, O. Reg. 776/93. She brought an action pursuant to s. 281 of the Insurance Act, seeking a declaration that she was entitled to the payment of statutory accident benefits from the Ontario Motor Vehicle Accident Claims Fund. The action was allowed. Section 25(2) of the Motor Vehicle Accident Claims Act ("MVAC Act") provides that the Minister shall not pay out of the Fund any amount in favour of a person who ordinarily resides outside of Ontario unless such person resides in a jurisdiction in which recourse of a substantially similar character to that provided by the MVAC Act is afforded to residents of Ontario. The trial judge found that the plaintiff was not ordinarily resident outside of Ontario when the accident took place. In reaching that conclusion, she relied on the facts that the plaintiff maintained an address at her parents' home in Toronto; most of her belongings remained in her Ontario home; she maintained her Canadian social insurance and had a family doctor in Toronto whom she retained as a physician; she considered her internship in New Mexico as temporary, reassessing its viability every six months; and she had no intention of giving up her residency in Ontario. The facts that the plaintiff filed no income tax returns in Canada from 1990 to 1996, and that her OHIP coverage and Ontario driver's licence had lapsed did not affect the trial judge's findings. Section 6(1) of the MVAC Act provides that any person who has recourse against the Fund for no-fault benefits under s. 268 of the Insurance Act may apply for payment out of the Fund of the benefits. Section 6(2)(a) of the MVAC Act provides that if a person has recourse against the Fund under s. 268 of the Insurance Act, a reference to an insurer in the No-Fault Benefits Schedule shall be deemed to be a reference to the fund. The trial judge found that s. 6 of the MVAC Act is not territorially limited to Ontario. The defendant appealed.
Held, the appeal should be allowed.
The issue of the plaintiff's ordinary residence raised a question of mixed fact and law. The standard of review of the trial judge's determination of that issue was the very high standard of "palpable and overriding error". There was no basis for concluding that the trial judge's reasoning or resolution of that issue demonstrated a palpable or overriding error.
The plaintiff's accident did not fall within the scope of Ontario's motor vehicle insurance regime. Section 268(1) of the Insurance Act, contained within Part VI of the Act, states that all motor vehicle liability policies are deemed to provide for the statutory accident benefits set out in the Schedule. Section 268(2) then sets out priority rules for determining who is liable to pay the statutory benefits. The plaintiff asserted that she came within s. 268(2)(iv): "if recovery is unavailable under subparagraph i, ii or iii, the occupant has recourse against the Motor Vehicle Accident Claims Fund". Part VI of the Act does not apply to a contract providing insurance in respect of an automobile not required to be registered under the Highway Traffic Act, R.S.O. 1990, c. H.8 ("HTA"). The HTA requires all motor vehicles driven on a highway in Ontario to be registered and plated in Ontario. Cars belonging to residents of other Canadian provinces or of foreign countries are exempted from the requirement of Ontario registration while being operated in Ontario, provided that the extraprovincial or foreign vehicle is validly registered according to the laws of the jurisdiction in which the person resides. However, extraprovincial or foreign vehicles must, while being operated in Ontario, have the three mandatory insurance coverages prescribed by the Compulsory Automobile Insurance Act , R.S.O. 1990, c. C.25. The plaintiff's vehicle did not need to be registered in Ontario. Nor did her policy need to comply with the mandatory coverage provisions of the Compulsory Automobile Insurance Act. The plaintiff's insurance policy could not be deemed by s. 268(1) of the Insurance Act to provide for the statutory accident benefits set out in the Schedule. That was because the plaintiff's vehicle was not being operated in Ontario. Moreover, the plaintiff did not sustain injuries in a motor vehicle accident in Ontario. Part VI of the Insurance Act, including s. 268, had no application to the plaintiff or her vehicle. It followed that the plaintiff could not access the Fund because entry to the Fund is triggered, pursuant to s. 6(1) of the MVAC Act, only if a person "has recourse against the Fund for no-fault benefits under s. 268 of the Insurance Act".
APPEAL from a judgment of McWatt J. (2002), 2002 49414 (ON SC), 58 O.R. (3d) 284, 24 M.V.R. (4th) 209 (S.C.J.) declaring that the plaintiff was entitled to payment of accident benefits from the Ontario Motor Vehicle Accident Claims Fund.
Cases referred to
Housen v. Nikolaisen, [2002] 2 S.C.R. 235, 2002 SCC 33, 219 Sask. R. 1, 211 D.L.R. (4th) 577, 286 N.R. 1, 272 W.A.C. 1, [2002] 7 W.W.R. 1, 30 M.P.L.R. (3d) 1, 10 C.C.L.T. (3d) 157; MacPherson v. MacPherson (1976), 1976 854 (ON CA), 13 O.R. (2d) 233, 70 D.L.R. (3d) 564, 28 R.F.L. 106 (C.A.); Thomson v. Minister of National Revenue, 1946 1 (SCC), [1946] S.C.R. 209, [1946] 1 D.L.R. 689, [1946] C.T.C. 51, 2 D.T.C. 812
Statutes referred to
Compulsory Automobile Insurance Act, R.S.O. 1990, c. C.25
Highway Traffic Act, R.S.O. 1990, c. H.8
Insurance Act, R.S.O. 1990, c. I.8, ss. 224, 226(2), 239, 241, 268, 281
Interpretation Act, R.S.O. 1990, c. I.11, ss. 17, 18
Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41, ss. 6(1), (2), 25(2)
Rules and regulations referred to
Counsel
David R. Neill, for respondent. Stan J. Sokol, for appellant
The judgment of the court was delivered by
MACPHERSON J.A.: --
A. Introduction
1The Compulsory Automobile Insurance Act, R.S.O. 1990, c. C.25, requires that all motor vehicles being operated on a public highway in Ontario have automobile insurance, including third party liability coverage, no fault statutory accident benefits and uninsured motorist coverage.
2The Motor Vehicle Accident Claims Act, R.S.O. 1990, c. M.41 (the "MVAC Act") created a fund (the "Fund") which stands as the payor of last resort of no fault accident benefits to persons injured in Ontario where there is otherwise no access to coverage under a motor vehicle liability policy. The Fund covers both Ontario residents and, in certain circumstances, non-residents injured in motor vehicle accidents in Ontario.
3This appeal concerns the scope of the coverage provided by the Fund, namely: in what circumstances can an Ontario resident injured in a motor vehicle in a foreign jurisdiction obtain compensation from the Fund if her insurance in the foreign jurisdiction does not cover the benefits she now seeks?
B. Facts
(1) The parties and the events
4The respondent, Bridget Young, grew up in Toronto, attended Trent University in Peterborough, and returned to Toronto to work. In the early 1990s, she attended a college and worked in California. In April 1995, she moved to Espanola, New Mexico, to work as a veterinary nurse.
5The respondent obtained a New Mexico driver's licence. She owned a pick-up truck that was registered and insured in New Mexico. Her insurance, from Clarendon National Insurance Company ("Clarendon"), provided third party liability coverage and uninsured motorist coverage. The respondent elected not to obtain first party medical coverage, which was optional.
6On February 10, 1996, the respondent was driving alone in Sante Fe, New Mexico. Her pick-up truck flipped and rolled over. Sadly, the respondent suffered catastrophic injuries that rendered her a quadriplegic.
7Through arrangements made by her family, the respondent was airlifted to Toronto on April 15, 1996. She was hospitalized at Wellesley Hospital and later at the Toronto Rehabilitation Institute, Lyndhurst Clinic.
8The respondent was without recourse against Clarendon for the no-fault statutory benefits provided to persons injured in vehicle accidents in Ontario. These benefits are set out in the Statutory Accident Benefits Schedule, O. Reg. 776/93 (the "Schedule"). On July 15, 1997, she made an application for such benefits to the Fund.
9The application was denied on November 26, 1997, by the Minister of Finance on two bases: (1) the Fund was not required to make any payment with respect to motor vehicle accidents which occurred outside Ontario; and (2) the respondent was not entitled to statutory accident benefits because she was not ordinarily resident in Ontario when the accident occurred.
10The denial of benefits was mediated on April 8, 1998. The mediation failed.
(2) The litigation
11The respondent brought an action pursuant to s. 281 of the Insurance Act, R.S.O. 1990, c. I.8, seeking a declaration that she was entitled to the payment of accident benefits from the Fund.
12The trial of the action took place before McWatt J. of the Superior Court of Justice on December 4 and 5, 2001. The trial judge held that the respondent was entitled to receive statutory accident benefits from the Fund.
13The trial judge addressed whether there was any touchstone between the accident in New Mexico and the province of Ontario. She embarked upon this inquiry because it would be inconceivable that Ontario's motor vehicle insurance regime would respond to an accident that had no connection with Ontario, that is, an accident that had no connection with Ontario's people, its vehicles or its territory.
14The respondent's vehicle had been licensed and plated in New Mexico. She had obtained car insurance in New Mexico. The accident occurred in New Mexico. Hence, neither the vehicle involved in the accident nor the place of the accident had any connection with Ontario.
15That left the respondent herself. The trial judge turned to the question of her ordinary residence. This issue arose because of s. 25 of the MVAC Act:
25(1) In this section, "residence" shall be determined as of the date of the motor vehicle accident as a result of which the damages are claimed.
(2) The Minister shall not pay out of the Fund any amount in favour of a person who ordinarily resides outside of Ontario unless such person resides in a jurisdiction in which recourse of a substantial similar character to that provided by this Act is afforded to residents of Ontario . . . .
16It was common ground at the trial that New Mexico did not provide recourse similar in nature to the Fund to residents in Ontario. Hence, if the respondent was a person who ordinarily resided outside of Ontario at the time of the accident, she would have no claim against the Fund. Conversely, if she was not ordinarily resident outside of Ontario at that time, a claim might be possible.
17After a thorough review of the case law and a careful analysis of the various factors connecting the respondent to New Mexico and Ontario, the trial judge determined that the respondent was not ordinarily resident outside of Ontario when the accident took place. She concluded [at paras. 20-21]:
For the following reasons, I find that Ms. Young was not ordinarily resident outside of Ontario at the time of the accident:
Ms. Young maintained an address at her parents' home in Toronto where she returned to on occasion during her education in the U.S. and where she returned to once she finished the first phase of her education in the U.S. Most of her belongings, but for a suitcase full of possessions, remained in her Ontario home. Her mail continued to be sent to that address and she used the address when renewing her Canadian passport in 1995.
Ms. Young maintained her Canadian social insurance and had a family doctor in Toronto whom she retained as her physician.
Ms. Young's sojourn in New Mexico which started in April 1995 was part of her studies in veterinarian nursing. She lived as a guest with Ms. Fields and her husband and moved only once they sold their home and had no room for her in their new quarters. That move took place just before the accident.
Ms. Young considered her internship in New Mexico as temporary, reassessing its viability every six months. She was in her second six month period when the accident occurred.
Ms. Young had no intention of giving up her residency in Ontario while living in New Mexico to complete her education.
The fact that the plaintiff filed no Canadian Income Tax returns from 1990 to 1996 does not affect my findings. The fact that her OHIP coverage and Ontario driver's licence had lapsed also does not affect my findings in this regard.
18The trial judge then turned to the other issue in the case: could an Ontario resident recover from the Fund for an accident which occurred outside Ontario? At the heart of this issue were s. 6 of the MVAC Act and s. 268 of the Insurance Act:
6(1) Any person who has recourse against the Fund for no- fault benefits under section 268 of the Insurance Act may make application, in a form prescribed by the Minister, for payment out of the Fund of the benefits.
(2) If a person has recourse against the Fund under section 268 of the Insurance Act,
(a) a reference to an insurer in the No-Fault Benefits Schedule shall be deemed to be a reference to the fund and a reference to an insured person shall be deemed to be a reference to the person who has recourse against the Fund; . . .
268(1) Every contract evidenced by a motor vehicle liability policy, including every such contract in force when the Statutory Accident Benefits Schedule is made or amended, shall be deemed to provide for the statutory accident benefits set out in the Schedule and any amendments to the Schedule, subject to the terms, conditions, provisions, exclusions and limits set out in that Schedule.
(2) The following rules apply for determining who is liable to pay statutory accident benefits:
- In respect of an occupant of an automobile,
i. the occupant has recourse against the insurer of an automobile in respect of which the occupant is an insured,
ii. if recovery is unavailable under subparagraph i, the occupant has recourse against the insurer of the automobile in which he or she was an occupant,
iii. if recovery is unavailable under subparagraph i or ii, the occupant has recourse against the insurer of any other automobile involved in the incident from which the entitlement to statutory accident benefits arose,
iv. if recovery is unavailable under subparagraph i, ii or iii, the occupant has recourse against the Motor Vehicle Accident Claims Fund.
19The trial judge interpreted these provisions in this fashion [at paras. 27-28 and para. 33]:
The legitimacy of Ms. Young's claim begins with a finding of legal liability of the Fund through s. 268 of the Insurance Act. I find that s. 6(1) of the MVAC Act clearly indicates that liability of the Fund to pay is created by s. 268 of the Insurance Act. Section 6(1) stipulates in what form an application for payment from the Fund should be made. Section 6(2)(a) of the MVAC Act applies to the facts of this case by providing that the Fund stands in the same position as an insurer as far as the Statutory Accident Benefits Schedule is concerned.
There is no territorial limitation set out in s. 6 of the MVAC Act. The Minister has provided me with little which could convince me that the provision clearly limits payment from the Fund to victims of accidents occurring in Ontario. The Minister contends that because there is a territorial limitation set out in other sections of the Act, that I should read one into s. 6. I am unable to find anything in the comprehensive reading of the legislation, including the Insurance Act, which allows me to infer a territorial limitation for s. 6(1) of the MVAC Act.
I find that if the legislators who crafted the MVAC Act intended that s. 6 have a territorial limitation to the Province of Ontario, they could and would have included that limitation in the wording of that section. They did not.
20The Minister of Finance appeals the trial judge's decision.
C. Issues
21The issues on appeal are:
(1) Did the trial judge err by concluding that the respondent was not ordinarily resident outside Ontario at the time of the accident?
(2) Did the trial judge err by concluding that the Fund was available to Ontario residents injured in motor vehicle accidents that occurred outside Ontario?
D. Analysis
(1) The respondent's 'ordinary residence'
22The issue of the respondent's ordinary residence raises, in my view, a question of mixed fact and law. The concept of "ordinary residence" is well-known in many legal domains, including family law, tax law and conflict of laws. It is therefore a legal concept. However, the application of this concept in a particular case involves consideration of the relevant facts of the case. It follows that the standard of review of the trial judge's determination of this issue is the very high standard of "palpable and overriding error": see Housen v. Nikolaisen, [2002] 2 S.C.R. 235, 2002 SCC 33, at p. 262 S.C.R.
23The determination of a person's ordinary residence requires that "all of the relevant factors are taken into consideration": see Thomson v. Minister of National Revenue, 1946 1 (SCC), [1946] S.C.R. 209, [1946] 1 D.L.R. 689, at p. 232 S.C.R., p. 707 D.L.R.
24The trial judge conducted a careful review of the relevant factors relating to the respondent's intentions and activities. She noted that the respondent filed no income tax returns in Canada from 1990 to 1996, and that her OHIP coverage and Ontario driver's licence had lapsed. However, the trial judge found that there were many factors which continued to connect the respondent to Ontario, including maintaining an address at her parents' home in Toronto, leaving most of her belongings there, using that address when she renewed her Canadian passport, maintaining her Canadian social insurance and retaining her Toronto physician. The trial judge also accepted the respondent's testimony that her travels to California and New Mexico were for study purposes only and that she did not intend to give up her residence in Ontario.
25It is important to note that there is a crucial difference between actual residence and ordinary residence. As expressed by Evans J.A. (dissenting, but not on this point) in MacPherson v. MacPherson (1976), 1976 854 (ON CA), 13 O.R. (2d) 233, 70 D.L.R. (3d) 564 (C.A.), at p. 236 O.R.:
[A] person may be ordinarily resident in a Province without being actually resident therein. In my opinion, actual residence connotes a degree of physical presence, not required to establish ordinary residence.
26There is no doubt that on February 10, 1996, the respondent's actual residence was New Mexico. However, after her review of the case law and the relevant facts, the trial judge concluded that the respondent was not ordinarily resident outside of Ontario on that date. I can see no basis for concluding that the trial judge's reasoning or resolution of this issue demonstrates a palpable and overriding error.
(2) The availability of the Fund
27The trial judge linked s. 268(1) of the Insurance Act with s. 6 of the MVAC Act (both set out above) and concluded that the Fund was available to compensate the respondent for her accident in New Mexico. With respect, I disagree with the trial judge's interpretation of both statutes in the circumstances of this case. I do not think that the respondent's accident falls within the scope of Ontario's motor vehicle insurance regime [See Note 1 at end of document].
28Section 268(1) of the Insurance Act, contained within Part VI (Automobile Insurance) of the Act, states that all motor vehicle liability policies are deemed to provide for the statutory accident benefits set out in the Schedule. Section 268(2) then sets out priority rules for determining who is liable to pay the statutory benefits. The respondent asserts that she comes within s. 268(2)(iv): "if recovery is unavailable under subparagraph i, ii or iii, the occupant has recourse against the Motor Vehicle Accident Claims Fund."
29Importantly, Part VI of the Insurance Act does not apply to a contract providing insurance in respect of an automobile not required to be registered under the Highway Traffic Act, R.S.O. 1990, c. H.8: see s. 226(2) of the Insurance Act.
30The Highway Traffic Act requires all motor vehicles driven on a highway in Ontario to be registered and plated in Ontario. Cars belonging to residents of other Canadian provinces or of foreign countries are exempted from the requirement of Ontario registration while being operated in Ontario, provided that the extraprovincial or foreign vehicle is validly registered according to the laws of the jurisdiction in which the person resides. However, extraprovincial or foreign vehicles must, while being operated in Ontario, have the three mandatory insurance coverages prescribed by the Compulsory Automobile Insurance Act.
31The respondent's vehicle did not need to be registered in Ontario. Nor did the respondent's insurance policy need to comply with the mandatory coverage provisions of the Compulsory Automobile Insurance Act. The respondent's insurance policy could not be deemed by s. 268(1) of the Insurance Act to provide for the statutory accident benefits set out in the Schedule. This is because the respondent's vehicle was not being operated in Ontario. Moreover, the respondent did not sustain injuries in a motor vehicle accident in Ontario. It follows that Part VI of the Insurance Act, including s. 268, has no application to the respondent or her vehicle.
32The only way in which the respondent could qualify for Ontario statutory accident benefits for an accident in New Mexico would have been if she were an insured person in respect of a particular motor vehicle liability policy issued in Ontario. In other words, her recourse for the payment of Ontario statutory benefits would have been contractual in nature. The respondent did not have such a policy, nor was she an insured person on any other Ontario policy.
33For these reasons, I conclude that the respondent's accident does not come within the scope of s. 268 of the Insurance Act [See Note 2 at end of document]. It follows that she also cannot access the Fund because entry to the Fund is triggered, pursuant to s. 6(1) of the MVAC Act, only if a person "has recourse against the Fund for no-fault benefits under section 268 of the Insurance Act". The respondent has no such recourse.
E. Disposition
34I would allow the appeal. The appellant does not seek costs of the trial or the appeal. I would order that there be no costs of the trial or the appeal.
Appeal allowed.
Notes
Note 1: After the trial judge's decision was released, the legislature amended the MVAC Act to deal explicitly with the question of its application to extraprovincial accidents:
6(3.1) Subject to s. 6.1, no payment out of the Fund shall be made in respect of statuory accident benefits if the accident from which the entitlement to statutory accident benefits arose occurred outside Ontario
The parties agree that, by virtue of ss. 17 and 18 of the Interpretation Act, R.S.O. 1990, c. I.11, this amendment has no bearing on the interpretation of the MVAC Act as it stood when the trial judge was considering it.
Note 2: I note that the trial judge supported her conclusion on this issue by referring to and interpreting several specific provisions of the Insurance Act, including ss. 224, 239 and 241. The respondent concedes that these interpretations either referred to the wrong version of these provisions, were in error or were, at their highest, unnecessary to her conclusion. I agree with these concessions and do not propose to consider these provisions.
