The appellant borrowed the respondent's truck and, while impaired, caused a collision that destroyed it.
The respondent's insurer paid the property damage claim and brought a subrogated action against the appellant in Small Claims Court, arguing the appellant breached a gratuitous bailment agreement.
The trial judge allowed the claim, finding it fell within the exception in s. 263(5)(a.1) of the Insurance Act, which permits actions 'under an agreement'.
On appeal, the Divisional Court upheld the decision, confirming that a gratuitous bailment constitutes an 'agreement' for the purposes of the statutory exception, allowing the subrogated claim to proceed.