Neutral Citation: 1996 ONICDRG 201

OIC A95-000666

ONTARIO INSURANCE COMMISSION

BETWEEN:

STEVEN R. HOLMES

Applicant

and

NATIONAL FRONTIER INSURANCE COMPANY

Insurer

DECISION

Issues:

The Applicant, Steven R. Holmes, was injured in an accident that occurred on April 23, 1995. He applied for statutory accident benefits from National Frontier Insurance Company ("National Frontier"), payable under the Schedule.¹ National Frontier refused to pay benefits on the grounds that Mr. Holmes was not covered by his automobile insurance policy because he was not injured in an "accident," as the term is defined in section 1 of the Schedule. National Frontier took the position that Mr. Holmes' injury was not caused, directly or indirectly, by the use or operation of an automobile.

The parties were unable to resolve their dispute through mediation and Mr. Holmes applied for arbitration under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The sole issue in this arbitration is:

Was Mr. Holmes injured in an accident? Specifically, were Mr. Holmes' injuries caused, directly or indirectly, by the use or operation of an automobile?

Mr. Holmes also claims his expenses incurred in the hearing.

Result:

1. Mr. Holmes was injured in an accident.

2. Mr. Holmes is entitled to his expenses in respect of this arbitration.

Hearing:

The Hearing was held in Sudbury, Ontario, on May 28, 1996, before me, Asfaw Seife, Arbitrator.

Present at the Hearing:

Applicant:

Steven R. Holmes

Mr. Holmes' Representative:

Douglas J. Los Barrister and Solicitor

National Frontier's Representative:

J. Claude Blouin Barrister and Solicitor

Witness:

Steven Holmes

The Applicant

Exhibit 1:

Part 3 of the Application for Accident Benefits- Details of the Accident

Both parties filed books of authorities. The cases referred to are listed in Appendix A to this decision.

Evidence and Findings:

The material facts in this case are not in dispute. In the early afternoon hours of Sunday, April 23, 1995, Mr. Holmes went to visit his neighbour, Jean Simon. Mr. Simon was in his garage, in the back of a pick-up truck. The truck was parked in the garage. Other people were in the garage, including Mike Audette, the owner of the pick-up truck. Mr. Holmes proceeded to the rear of the garage and approached Mr. Simon.

At this time, Mr. Holmes noticed that Mr. Simon was working on a storage tank located in the back of the truck. The tank contained driveway sealing substance. Mr. Simon was welding bolts to the top of the tank, to secure a take-up reel for a hose. He was using an arc welding torch. In the process of welding, the storage tank was punctured, the flammable substance in it was ignited. An explosion ensued. Mr. Holmes saw "a ball of fire" coming towards him. He was hit on the head by an unknown object. The truck caught fire, and the garage was instantly filled with smoke. Mr. Holmes could not see the exit, so he began to crawl, trying to find his way out. His clothing was on fire, covered with hot driveway sealant. Having exited the garage and reached a safe area, he managed to shed his clothing. He was assisted by a neighbour until an ambulance arrived. As a result of the explosion, Mr. Holmes received second and third degree burns to his head, face, hand, arms and other parts of his body.

The pick-truck in question was used in connection with a driveway-sealing business owned and operated by Mr. Audette. The equipment, tools and supplies necessary for carrying out the business were on the pick-up truck. The storage tank and pump had been installed on the truck, and were permanently affixed to it. The tank took up the entire rear area, and full-width of the truck. The take-up reel for the hose was mounted on top of the tank, and was permanently attached to the tank. The 150-foot long hose went through holes in the back of the truck and was attached to the cooling system of the truck.

Analysis and Conclusion:

Section 1 of the Schedule defines "accident" as:

... an accident in which, directory or indirectly, the use or operation of an automobile causes an impairment or causes damage to any prescription eyewear, denture, hearing aid, prosthesis or other medical or dental device; [emphasis added]

The incident in question is the explosion of the storage tank. There is no dispute that Mr. Holmes' injuries resulted from the explosion; where the parties do not agree is whether the explosion was caused by the "use or operation" of the pick-up truck.

1. Use or Operation

Mr. Los, counsel for the Applicant, submitted that the explosion resulted from the use of the pick-up truck. He argued that Mr. Simon was performing repair work on equipment permanently installed on a commercial vehicle, which is part of the vehicle. He submitted that at the time of the explosion, Mr. Simon was "using" the vehicle, and the explosion constitutes an "accident," within the meaning of section 1 of the Schedule.

On behalf of National Frontier, Mr. Blouin argued that Mr. Holmes' injury was the result of a negligent use of an arc welder, and that the vehicle was merely the site of the negligent act. He submitted that Mr. Holmes' injury was not caused, directly or indirectly, by the use or operation of the truck.

It appears to me to be settled law in Canada that the phrase "use or operation of an automobile," is not limited to driving the vehicle. It includes any "ordinary and well known activity to which automobiles are put." This interpretation was established by the Supreme Court of Canada in the case of Stevenson v. Reliance Petroleum Ltd.² That case involved the negligence of a driver of a tank truck who left his truck unattended while discharging gasoline to a service station's tank. This led to the gasoline overflowing, igniting and destroying the premises. The question in that case was whether the incident arose out of the "ownership, use or operation of the automobile." Rand J. stated.:

The expression "use or operation" would or should, in my opinion, convey to one reading it all accidents resulting from the ordinary and well-known activities to which automobiles are put, all accidents which the common judgment in ordinary language would attribute to the utilization of an automobile as a means of different forms of accommodation or service.

Recently, the Supreme Court of Canada in Amos³ considered a case involving the interpretation of "accident" in British Columbia's no-fault automobile insurance scheme. The insured in that case was surrounded by a group of men, and shot while driving his car. The question was whether the insured's injury arose from the use or operation of the vehicle. The court noted with approval that traditionally, provisions providing coverage in private automobile insurance policies have been interpreted broadly in favour of the insured, and exclusions interpreted strictly and narrowly against the insurer. The court also adopted the following two-part test, developed by the courts to determine whether an injury resulted from the use or operation of an automobile:

1. Did the accident result from an ordinary and well-known activity to which automobiles are put (the "purpose test"); and,

2. Is there some nexus or causal relationship (not necessarily a direct or proximate causal relationship) between the injuries and the [ownership], use or operation of the vehicle, or is the connection merely incidental or fortuitous? ("the chain of causation test").

With regard to the first part of the test, therefore, the question that must be answered in this case is: did the work on the driveway sealing equipment in the back of the pick-up truck constitute an "ordinary and well known activity" to which such vehicles are put? In my view, the answer is "yes."

Courts and arbitrators have found the phrase "ordinary and well known activities to which automobiles are put" applies to diverse fact situations, including such activities as discharging gasoline from a tanker truck (Stevenson⁴), draining or syphoning gasoline from a vehicle (Pioneer Grain⁵ and Shelton⁶), drilling a hole in the trunk of an automobile to connect wires to a trailer (Gramak⁷), unhitching a forklift truck from a stationary vehicle (Royal v. Guardian⁸), repairing vehicle parts after removal from the vehicle and in close proximity to the vehicle (Kracson⁹ and Munro¹⁰), leaving a dog in a parked car (Boell¹¹), ordinary repair and maintenance work done upon a car (Elias¹²), preparing a truck to be unloaded (Portch¹³) and starting the engine of a car (Vineski¹⁴).

In the case of Chateauvert v. Economical Mutual Insurance Company,¹⁵ two individuals died from carbon monoxide fumes that came from a portable hibachi¹⁶ that had been smouldering in the back of the van in which they were sleeping. Applying the "purpose test," the court found that the ordinary and well known activities to which vans are put did not include sleeping on a make-shift mattress, and lighting a hibachi in the back of the van. It concluded that the deaths did not arise out of the "use or operation" of an automobile. Penne, J. stated, at p. 836:

The van did not have a built-in sleeping area; instead, the mattress was simply placed on a board which was laid across the metal fenders. There was no built-in stove, sink, or washroom in the van. The hibachi was portable. The living quarters were therefore of a temporary nature. The common use to which a van is put is the transportation of people and goods. I cannot find that it is a common practice for vans without permanent living quarters to be used for the purpose of eating and sleeping.

Applying the "chain of causation test" the court found the deaths occurred simply because of the negligence of the parties in leaving the hibachi partly lit in the van while they went to sleep.

While each case must be decided on its own facts, I find that these cases provide helpful guideline as to what activities may or may not be considered an ordinary and well known use or operation of an automobile. Applying the principles enunciated in the Amos case, and the approaches employed in the above-cited cases, I find in this case that the welding/repair work done on equipment that had been permanently installed in the pick-up truck constitutes an ordinary and well known activity to which such vehicles are put.

Repair work need not be necessary to the immediate drivability of the vehicle to come within the meaning of "use." The pick-up truck in this case was used for carrying out the business of driveway sealing. The equipment is permanently installed in the vehicle and in ancillary to the essential purpose of the vehicle. In my view, repair or maintenance work done on the equipment, in the facts of this case, is in essence, work done on the vehicle itself.

Accordingly, I find the first part of the test has been met.

2. Causation

The second part of the test requires a causal relationship between the use or operation of the vehicle and the injuries sustained.

Mr. Blouin suggested that the welding is an intervening act, unrelated to the use or operation of the vehicle. I have already found that the work being done on the vehicle constitutes sufficient "use or operation" of the vehicle to satisfy the wording of section 1 of the Schedule. Given this finding, it is clear on the evidence that Mr. Holmes' injury was caused directly by the explosion which was caused directly by the arc welder puncturing the storage tank and igniting the fuel in it. All of this occurred in the course of repairing the vehicle, the activity which constitutes "use" of the vehicle. In my view, these events were uninterrupted by any intervening act. Accordingly, I find that the second part of the test is satisfied. Mr. Holmes' injury was caused by the use or operation of an automobile.

In the result, I find that Mr. Holmes was injured in an accident.

I exercise my discretion under section 282(10) of the Act to award Mr. Holmes his expenses incurred in respect of this arbitration.

Order:

1. Mr. Holmes was injured in an accident.

2. Mr. Holmes is entitled to his expenses incurred in respect of the arbitration.

December 4, 1996

Asfaw Seife Arbitrator

Date

APPENDIX A - Authorities

Cases Considered:

Amos v. Insurance Corporation of British Columbia, 1995 CanLII 66 (SCC), [1995] S.C.J. No. 74

Boell v. Schinkel, [1991] 3 O.R. (3d), p. 741

Chateauvert v. Economical Mutual Insurance Company, [1980] I.L.R. Par. 1-1223, Canadian Insurance Law Reports (1980)

Ekunah v. Simcoe & Erie General Insurance (March 25, 1995), OIC A-007550

Elias v. Insurance Corporation of British Columbia and Niagara Fire Insurance Company, [1992] 12 C.C.L.I. (2d), p. 135

Gramak Ltd. et al v. State Farm Mutual Automobile Insurance Company [1975] 10 O.R. (2d), I.L.R., p. 518

Hanlon v. Guarantee Company of North /America (October 30, 1995), OIC A-011977

Kracson et al v. Pafco Insurance Company Ltd., [1981] 32 O.R. (2d), p. 336

Law, Union & Rock Insurance Company Limited v. Moore's Taxi Limited 1959 CanLII 81 (SCC), [1960] S.C.R. 80. I.L.R.

Lloyds v. Reliance Petroleum Limited and Reliance Petroleum Limited v. Canadian General Insurance Company, [1956] C.I.L.R., p.127; cited [1956] I.L.R.

Mander v. Wellington Insurance Company, (September 24, 1993), OIC A-002057

McIndoe v. Insurance Corporation of British Columbia, [1990] 45 C.C.L.I., p. 68

Munro Estate v. Johnston, [1994] 25 C.C.L.I. (2d), p. 34

Omand et al v. Disabled and Aged Regional Transit Systems, carrying on business as DARTS et al, [1993] 14 O.R. (3d), p. 52

Pioneer Grain Company v. Wellington Insurance Company (1988), 35 C.C.L.I., p. 176

Portch and Markel Insurance Company of Canada; and Portch and Royal Insurance Company of Canada (March 20, 1995), OIC A-007701 and A-008360

Re Royal Insurance Company of Canada and Guardian Insurance Company of Canada (1995), 26 O.R. (3d) p. 290

Shelton v. Insurance Corporation of British Columbia and Zurich Insurance Company, [1993] 15 C.C.L.I. (2d), p.161

Stevenson v. Reliance Petroleum Ltd. (1956), 1956 CanLII 27 (SCC), 5 D.L.R. (2d) 673 (S.C.C.)

Vineski and Federation Insurance Company of Canada (September 8, 1995), OIC A-012588 and (October 18, 1996), OIC P96-000034

Whitehead v. Whitehead et al, 1984 CanLII 5980 (BC SC), [1984] 7 C.C.L.I., p.299

Footnotes

1. 1The Statutory Accident Benefits Schedule — Accidents on or after January 1, 1994, called "the Schedule" in this decision. The Schedule is Ontario Regulation 776/93, as amended by Ontario Regulation 635/94 and 781/94.
2. 2Stevenson v. Reliance Petroleum Ltd. (1956), 1956 CanLII 27 (SCC), 5 D.L.R. (2d) 673 (S.C.C.)
3. 3Amos v. Insurance Corporation of British Columbia, 1995 CanLII 66 (SCC), [1995] S.C.J. No. 74
4. 4Supra note 2
5. 5Pioneer Grain Company v. Wellington Insurance Company (1988), 35 C.C.L.I. 116
6. 6Shelton v. Insurance Corporation of British Columbia and Zurich Insurance Company, [1993] 15 C.C.L.I. (2d), p.161
7. 7Gramak Ltd. et al v. State Farm Mutual Automobile Insurance Company [1915] 10 O.R. (2d), p. 518 I.L.R.
8. 8Re Royal Insurance Company of Canada and Guardian Insurance Company of Canada (1995), 26 O.R. (3d) p. 290
9. 9Kracson et al v. Pafco Insurance Co. Ltd., [1981] 32 O.R. (2d), p. 336
10. 10Munro Estate v. Johnston, [1994] 25 C.C.L.I. (2d), p. 34
11. 11Boell v. Schinkel, [1991] 3 O.R. (3d), p. 141 (Gen. Div.)
12. 12Ed Elias v. Insurance Corporation of British Columbia and Niagara Fire Insurance Company, [1992] 12 C.C.L.I. (2d), p.161
13. 13Portch and Markel Insurance Company of Canada and Royal Insurance Company of Canada (March 20, 1995), OIC A-001101 and A-008360 (Appendix B to this decision contains a thorough review of relevant case law on this issue)
14. 14Vineski and Federation Insurance Company of Canada (September 8, 1995), OIC A-012588 and (October 18, 1996), P96-000034.
15. 15Text cited in Canadian Insurance Law Reports (1980), I.L.R. p. 834
16. 16A Japanese-style charcoal brazier, used usually for outdoor cooking.