Neutral Citation: 2011 ONFSCDRS 3 FSCO A09-001616

BETWEEN:

CASSONDRA BOUCHARD Applicant

and

MOTORS INSURANCE CORPORATION Insurer

DECISION ON A PRELIMINARY ISSUE

Before: Arbitrator Denise Ashby Heard: November 8, 2010, at the offices of the Financial Services Commission of Ontario in Toronto.

Appearances: Charles E. Gluckstein for Ms. Bouchard J. Claude Blouin for Motors Insurance Corporation

Issues:

The Applicant, Cassondra Bouchard, was involved in an incident on January 13, 2008. She applied for and was denied statutory accident benefits by Motors Insurance Corporation (“Motors”), payable under the Schedule.¹ The parties were unable to resolve their disputes through mediation, and Ms. Bouchard applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act, R.S.O. 1990, c.I.8, as amended.

The issues in this preliminary issue hearing are:

Was Ms. Bouchard involved in an “accident” within the meaning of section 2(1) of the Schedule?
Is Motors liable to pay Ms. Bouchard’s expenses in respect of the preliminary issue hearing pursuant to subsection 282(11) of the Insurance Act?
Is Ms. Bouchard liable to pay Motors’ expenses in respect of the preliminary issue hearing pursuant to subsection 282(11) of the Insurance Act?

Result:

Ms. Bouchard was involved in an accident within the meaning of section 2(1) of the Schedule.
The parties made no submissions with respect to expenses. In the event they are unable to resolve the issue they may request an expense hearing before me in accordance with the Dispute Resolution Practice Code.

EVIDENCE and SUBMISSIONS:

The parties submitted the following Agreed Statement of Facts and I find:

On January 13, 2008, Cassondra Bouchard (“Cassondra”) was injured while riding a “pocket bike” on private property located at 3199 Uxbridge Concession Road 7. The property was owned by Canada Cement Lafarge Ltd. and leased and occupied by Kristin Stratton.
The pocket bike was a Honda CRF 50 Mini Bike. It is a gas powered miniature motorcycle. The owner, Kristin Stratton, used the pocket bike on his own property and the property of a friend.
During the night of January 12, 2008 and the early morning of January 13, 2008, Cassondra attended a gathering at Kristin Stratton’s house. Brandon Cowie was also in attendance.
At approximately 12:00 a.m., Cassondra was riding the pocket bike. Brandon Cowie was riding another pocket bike belonging to Kristin Stratton. The two bikes were involved in a collision.
As a result of the collision between the two pocket bikes, Cassondra sustained injuries and was taken by ambulance to Uxbridge Cottage Hospital and subsequently transferred to St. Michael’s Hospital in Toronto.
Cassondra is an insured person pursuant to a motor vehicle liability policy issued by Motors Insurance Corporation (“Motors”) insuring a 1999 Ford Ranger and a 2001 GMC Jimmy.
Cassondra submitted an Application for Accident Benefits to Motors, which is dated February 8, 2008 and received by Motors March 7, 2008.
By letter dated March 10, 2008, Motors denied Cassondra’s claim for Accident Benefits on the grounds that a pocket bike is not an automobile, and there is therefore no coverage provided for in the SABS, as the definition of “accident” cannot be met.
The parties participated in a mediation at the Financial Services Commission of Ontario on April 28, 2009 where the dispute was not resolved.
Cassondra therefore applied for arbitration on June 18, 2009.

As well, the unsworn Statement of Kristin M. Stratton, the owner of the pocket bike, was entered as Exhibit 2.² I accept the owner’s identification of the pocket bike and find it has VIN number: “JH2AE0325X5K500186”.

Motors’ Submissions:

Motors submits that a pocket bike is not an automobile within the meaning of subsection 2(1) of the Schedule and therefore Ms. Bouchard was not involved in an accident and is not entitled to statutory accident benefits.

Motors asserts the pocket bike is a “restricted-use motorcycle” which is not intended to be ridden on public roads as described in the Commission’s website article entitled “Alternative Vehicles.”³ The Canada Safety Council advises that pocket bikes are not street legal because they do not have VIN numbers and do not meet the safety requirements of a motorcycle as they are low to the ground and therefore may not be visible to other motorists. As well, drivers of pocket bikes are not required to be licensed and may not wear proper protective gear.⁴

Motors relies on the Court of Appeal decision in Adams v. Pineland Amusements Ltd in which the court adopted a three-part test in finding that a go-kart was not an automobile. The court found that the first question to be answered is: was the vehicle an automobile in common parlance? If the answer is “no” then one asks: is the vehicle defined as an automobile in the wording of the insurance policy? If the answer is again “no” one goes on to ask: does the vehicle fall within any enlarged definition of “automobile” in any relevant legislation? An affirmative answer to any of the three questions classifies the vehicle as an automobile insured by the Standard Automobile Insurance Contract.⁵

Motors submits that the pocket bike is not an automobile in “ordinary parlance” and was not defined as such in the Motors policy. As well, there is no regulation which prescribes a pocket bike to be an automobile pursuant to subsection 224(1)(b) of the Insurance Act. Motors submits that the remaining consideration is whether the pocket bike is required under any Act to be insured under a motor vehicle liability policy pursuant to the expanded definition in subsection 224(1)(a).

Motors submits that although a pocket bike is a motor vehicle pursuant to the Highway Traffic Act, the question becomes is it a motor vehicle required to be insured under a motor vehicle insurance policy? Section 2 of the Compulsory Automobile Insurance Act prohibits a motor vehicle from being operated on a highway unless it is insured under a contract of automobile insurance. As a pocket bike cannot be registered as a motor vehicle and cannot be registered or licensed in Ontario pursuant to the Highway Traffic Act, then the Compulsory Automobile Insurance Act cannot and does not require that a pocket bike be insured under a contract for automobile insurance. It also submits that if a pocket bike is construed to be an off-road vehicle, subject to the provisions of section 15 of the Off-Road Vehicles Act, it benefits from the exclusion set out in subsection 15(9) because at the time of the accident it was being driven on lands occupied by the owner.

Motors relies on the Court of Appeal decision in Copley v. Kerr Farms Inc. in which the Court found as follows:

The tomato wagon was not being operated on the highway when the accident occurred. Section 2(1) of the Compulsory Automobile Insurance Act did not require Kerr Farms to have the tomato wagon insured under an automobile insurance policy at the time and place where the accident occurred. The fact that the tomato wagon was regularly taken on the highway and that Mr. Copley intended to take it on the highway as soon as it was hooked up to his truck does not extend the reach of s.2(1) of the Compulsory Automobile Insurance Act. That section does not prohibit the use of an uninsured motor vehicle intended to be taken on the highway, or regularly used on the highway, or used at any time on the highway. The prohibition in s. 2(1) speaks in terms of a motor vehicle that is operated on the highway. As I read the section, the prohibition speaks only to motor vehicles that are being operated on the highway.⁶

Motors reasons that as the pocket bike was not being operated on a highway, or in the context of the Off-Road Vehicles Act on land other than that occupied by the owner of the bike, it was not required to be insured and therefore it is not an automobile pursuant to the expanded definition in subsecton 224(1)(a).

Ms. Bouchard’s Submissions:

Ms. Bouchard submits that as “automobile” is not defined in the Schedule, sections 1 and 224 of the Insurance Act must be considered. She submits that the pocket bike is an automobile within the meaning of section 1 as it is self-propelled and does not fall within the exclusions set out in section 1. In the alternative, subsection 224(1)(a) sets the determinative factor as a requirement by any other Act that the pocket bike be insured.

Ms. Bouchard submits that the pocket bike is an off-road vehicle as defined in section 1 of the Off-Road Vehicles Act. Section15 of this Act requires that an off-road vehicle be insured under a motor vehicle liability policy pursuant to the Insurance Act unless driven on land occupied by the owner. As Kristen Stratton, the owner of the pocket bike, drove the pocket bike on lands the owner did not occupy, the pocket bike was required to be insured pursuant to the Off-Road Vehicles Act. Therefore, pursuant to subsection 224(1)(a), the pocket bike is an automobile within the meaning of the Insurance Act and Ms. Bouchard was involved in an accident within the meaning of subsection 2(1) of the Schedule.

Ms. Bouchard distinguishes the Court of Appeal decision in Copley v. Kerr Farms Inc. on the basis that the court was determining whether a tomato wagon was an “automobile” within the expanded definition of subsection 224(1)(a) of the Insurance Act in the context of the Highway Traffic Act and the Compulsory Automobile Insurance Act. The Court did not consider the provisions of the Off-Road Vehicles Act. Ms. Bouchard submits that it would be absurd to require an owner to insure the vehicle each time the pocket bike was to be operated off land she or he occupied. As the pocket bike was driven at the friend’s house it was required to be insured and is therefore an automobile within the meaning of section 224(1) of the Insurance Act.

ANALYSIS:

The following statutory provisions are relevant to determining whether Ms. Bouchard was involved in an “accident” within the meaning of subsection 2(1) of the Schedule. It provides:

“accident” means an incident in which the use or operation of an automobile directly causes an impairment or directly causes damage to any prescription eyewear, denture, hearing aid, prosthesis or other medical or dental device;

Section 1 of the Insurance Act defines “automobile” as:

“automobile” includes a trolley bus and a self-propelled vehicle, and the trailers, accessories and equipment of automobiles, but does not include railway rolling stock that runs on rails, watercraft or aircraft;

Subsection 224(1) of the Insurance Act defines an automobile as:

“automobile” includes,

(a) A motor vehicle required under any Act to be insured under a motor vehicle liability policy, and

(b) A vehicle prescribed by regulation to be an automobile,

Subsection 1(1) of the Highway Traffic Act, R.S.O. 1990, c. H.8, defines a motor vehicle and motorcycle as follows:

“motor vehicle” includes an automobile, motorcycle, a motor-assisted bicycle unless otherwise indicated in this Act, and any other vehicle propelled or driven otherwise than by muscular power, but does not include a street car or other motor vehicle running only upon rails, a power-assisted bicycle, a motorized snow vehicle, a traction engine, a farm tractor, a self-propelled implement of husbandry or a road-building machine;

“motorcycle” means a self-propelled vehicle having a seat or saddle for the use of the driver and designed to travel on not more than three wheels in contact with the ground, and includes a motor scooter, but does not include a motor assisted bicycle;

Section 1 of the Off Road Vehicles Act, R.S.O., 1990, C. O.4 defines an off-road vehicle as:

“off-road vehicle” means a vehicle propelled or driven otherwise than by muscular power or wind and designed to travel,

(a) On not more than three wheels, or

(b) On more than three wheels and being of a prescribed class of vehicle;

Subsection 2(1) provides that the Off-Road Vehicles Act does not apply to off-road vehicles being operated on a highway.

Section 15 of the Off-Road Vehicles Act sets out requirements for off-road vehicles to be insured as follows:

(1) No person shall drive an off-road vehicle unless it is insured under a motor vehicle liability policy in accordance with the Insurance Act.

(2) No owner of an off-road vehicle shall permit it to be driven unless it is insured under a motor vehicle liability policy in accordance with the Insurance Act.

(3) Every driver of an off-road vehicle who is not owner thereof shall, upon the request of a peace officer, surrender for inspection evidence that the vehicle is insured under a motor vehicle liability policy in accordance with the Insurance Act.

(9) Subsections (1), (2) and (3) do not apply where the vehicle is driven on land occupied by the owner of the vehicle.

I agree that to determine whether a vehicle is an automobile within the meaning of the Insurance Act there are three questions, an affirmative answer to any one of which results in the vehicle qualifying as an automobile within the meaning of the Insurance Act.

I find that a pocket bike is not an automobile in common parlance as it is not designed to be used on a public motor way. It is common ground that the pocket bike is not defined as an automobile in the wording of the insurance policy and it is not prescribed by regulation to be an automobile pursuant to subsection 224(1)(b) of the Insurance Act. The crux of the dispute is whether the pocket bike is an automobile by virtue of its being required to be insured by any Act pursuant to subsection 224(1)(a).

A pocket bike is a vehicle propelled or driven otherwise than by muscular power or wind and travels on not more than three wheels, therefore, it comes within the definition of an off-road vehicle pursuant to subsection 1(a) of the Off-Road Vehicles Act. As well, it is not excluded from operation of the Act by subsection 2(1) as it was not being operated on a highway. Therefore it is required to be insured pursuant to subsection 15(1) unless it is exempt because it was driven “on land occupied by the owner”.

Justice Laskin in Bapoo v. Cooperators, [1997] Carswell Ont 5101(C.A.), enunciated the principle that governs statutory interpretation: “The modern approach to statutory interpretation calls on courts to interpret a legislative provision in its total context. The court’s interpretation should comply with the legislative text, promote the legislative purpose and produce a reasonable and just meaning.”

In Copley v. Kent Farms Ltd., the court was dealing with the application of section 267 and subsection 224(1) of the Insurance Act to a tomato wagon which was being attached to Mr. Copley’s truck when he was injured. In determining that the tomato wagon was not an automobile the court considered subsection 2(1) of Compulsory Automobile Insurance Act and subsection 1(1) of the Highway Traffic Act.

Subsection 2(1) of the Compulsory Automobile Insurance Act, R.S.O. 1990, C. C.25, provides:

Subject to the regulations, no owner or lessee of a motor vehicle shall,

(a) operate the motor vehicle; or

(b) cause or permit the motor vehicle to be operated,

on a highway unless the motor vehicle is insured under a contract of automobile insurance.

Justice Doherty found that “trailer,” an undefined term, should be given its ordinary meaning in the context of the Compulsory Automobile Insurance Act. He stated:

However, the mere fact that the tomato wagon is a trailer does not suffice to bring the wagon within the definition of motor vehicle in the Compulsory Automobile Insurance Act. It must be a trailer “of a motor vehicle”. I think the phrase “of a motor vehicle” is meant to draw a distinction between trailers which are under the power and control of a motor vehicle and those which are not. A trailer sitting in the field is not a trailer ‘of a motor vehicle”. In my view, only trailers which are attached to and under the power and control of a motor vehicle can properly be described as “trailers…of a motor vehicle”.

Justice Doherty’s comments, set out above as cited by Motors, must be read in the context of this finding. As Justice Doherty states in his later finding: “The prohibition in s. 2(1) speaks in terms of a motor vehicle that is operated on the highway. As I read the section, the prohibition speaks only to motor vehicles that are being operated on the highway.”⁷ As the Off-Road Vehicles Act specifically excludes vehicles which are being operated on the highway the provisions of the Compulsory Automobile Insurance Act do not apply.

Subsection 15(1) of the Off-Road Vehicles Act states: “No person shall drive an off-road vehicle unless it is insured under a motor vehicle liability policy in accordance with the Insurance Act.” The only exception to this rule is an off-road vehicle driven on lands occupied by its owner as set out in subsection 15(9). It is a very narrow exclusion. Clearly the legislature intended that off-road vehicles be insured unless they were used solely on lands occupied by the owner. I agree that it would be an absurd result if each time an owner was to drive the vehicle on lands other than those she or he occupied insurance had to be procured. In my view, the consequence of the owner of the pocket bike driving it at “my friend’s house” was the necessity to insure it. Therefore, the pocket bike is required to be insured by operation of the provisions of the Off-Road Vehicles Act and is an automobile within the expanded definition in subsection 224(1)(a) of the Insurance Act. As a consequence, Ms. Bouchard was involved in an accident within the meaning of subsection 2(1) of the Schedule notwithstanding the accident occurred on lands occupied by the owner.

EXPENSES:

The parties made no submissions with respect to expenses. I encourage them to resolve the issue, failing which they may request an expense hearing before me in accordance with the Dispute Resolution Practice Code.

January 7, 2011

Denise Ashby Arbitrator

Date

Financial Services Commission of Ontario