Lefor, by her Litigation Guardian Wilson v. McClure et al.; Pafco Insurance Company added by order pursuant to [Section 258(14)](https://www.canlii.org/en/on/laws/stat/rso-1990-c-i8/latest/rso-1990-c-i8.html) of the [Insurance Act](https://www.canlii.org/en/on/laws/stat/rso-1990-c-i8/latest/rso-1990-c-i8.html), R.S.O. 1990, [Chapter I-8](https://www.canlii.org/en/qc/laws/stat/cqlr-c-i-8/latest/cqlr-c-i-8.html), Third Party [Indexed as: Lefor (Litigation guardian of) v. McClure]
49 O.R. (3d) 557
[2000] O.J. No. 2244
Docket No. C33278
Court of Appeal for Ontario
Borins, MacPherson and Sharpe JJ.A.
June 16, 2000
Insurance -- Automobile insurance -- Interpretation and construction -- "Ownership, use or operation of motor vehicle" -- Insured stopping her car and leaving engine running while she dropped her children off at babysitter's residence -- One child running into path of motor vehicle while crossing road to babysitter's house -- Accident arising from ownership, use or operation of motor vehicle.
The defendant was insured under a standard motor vehicle policy that provided for indemnity for loss or damages "arising from the ownership or directly or indirectly from the use or operation" of her automobile. She parked on the street opposite her mother's residence, where she intended to leave her children for the evening. Leaving the engine running, she started to take the children across the road. Her daughter ran out into the path of an oncoming vehicle and suffered physical injuries. The insurer refused to defend and indemnify the defendant and third party proceedings were taken by her claiming declarations that the insurer was required to defend the main action and to indemnify her with respect to her daughter's claim. The insurer brought a motion for summary judgment dismissing the third party action. The motions judge dismissed the motion and granted a declaration that the accident occurred at least indirectly from the use of the insured's motor vehicle. The insurer appealed.
Held, the appeal should be dismissed.
The motions judge correctly concluded that the accident arose from the ownership, or directly or indirectly from the use or operation of the defendant's motor vehicle. Stopping vehicles to pick up and drop off passengers is an ordinary and well-known aspect of the use and operation of an automobile. There was a clear nexus between the use and operation of the defendant's vehicle and her daughter's injuries. The automobile was stopped temporarily, its motor still running, to drop off the defendant's daughter. The accident occurred as a result of the use of the defendant's vehicle as a means of conveying passengers from one place to another. The defendant's decision to park her car on the opposite side of the road from her mother's house and leave it running while she and her children darted across the street placed her daughter in a situation of danger and triggered the sequence of events that resulted in her daughter's injuries. The alleged negligence of the defendant after she left her vehicle did not preclude coverage as the motor vehicle need not be the instrument of the injury, and injuries which do not arise from the negligent use of a motor vehicle may be covered.
APPEAL from an order of Marchand J. dismissing a motion for summary judgment.
Amos v. Insurance Corp. of British Columbia, 1995 66 (SCC), [1995] 3 S.C.R. 405, 10 B.C.L.R. (3d) 1, 127 D.L.R. (4th) 618, 186 N.R. 150, [1995] 9 W.W.R. 305, [1995] I.L.R. 1-3232, 13 M.V.R. (3d) 302, apld Law, Union & Rock Insurance Co. v. Moore's Taxi Ltd., 1959 81 (SCC), [1960] S.C.R. 80, 22 D.L.R. (2d) 264, consd Alchimowicz v. Continental Insurance Co. of Canada (1996), 1996 1313 (ON CA), 37 C.C.L.I. (2d) 284, 22 M.V.R. (3d) 41 (Ont. C.A.), distd Other cases referred to Incerto v. Landry (2000), 2000 22346 (ON SC), 47 O.R. (3d) 622 (S.C.J.); Non-Marine Underwriters, Lloyd's of London v. Scalera (2000), 2000 SCC 24, 185 D.L.R. (4th) 1, [2000] S.C.J. No. 26; V.K. Mason Construction Ltd. v. Canadian General Insurance Group Ltd. (1998), 1998 14615 (ON CA), 42 O.R. (3d) 618, 42 C.L.R. (2d) 241 (C.A.); Wu v. Malamas (1985), 1985 235 (BC CA), 67 B.C.L.R. 105, 21 D.L.R. (4th) 468, [1985] I.L.R. 1-1980 (C.A.) Statutes referred to Insurance Act, R.S.O. 1990, c. I.8, s. 239(1)(a)
Sheldon A. Gilbert, Q.C., for appellant. Sandra L. Coleman, for respondent, Fiona McClure. J. Daniel Dooley, for respondent, Netasha Lefor.
The judgment of the court was delivered by
SHARPE J.A.: --
Facts
[1] On November 5, 1993, Karen Lefor was driving to a concert. Her two children, the plaintiff Netasha, then aged seven, and her son Christopher, then aged five, were passengers in the car. Ms. Lefor parked on the street opposite her mother's residence where she intended to leave her children for the evening. Without turning off the motor of her vehicle, she got out of the car and walked around to the back of the vehicle with her two children. Ms. Lefor was holding her son's hand and her son was holding the hand of his sister, Netasha. The respondent told her children "don't run" as she saw the vehicle of the respondent McClure approaching. Netasha misunderstood and proceeded to the middle of the road where she stopped. She looked for traffic but saw none and then started forward. Netasha was struck by the McClure vehicle and, as a result of the accident, suffered physical injuries that form the subject-matter of this action.
[2] The appellant third party Pafco Insurance Company ("Pafco") is Karen Lefor's insurer pursuant to a standard motor vehicle policy that provides, pursuant to the Insurance Act, R.S.O. 1990, c. I.8, s. 239(1)(a), for indemnity for loss or damages "arising from the ownership or directly or indirectly from the use or operation" of her motor vehicle. The issue on this appeal is whether the appellant Pafco is required to defend and, to the extent she is found liable, indemnify Karen Lefor with respect to the claim of Netasha.
Procedural Background
[3] Pafco refused to defend and indemnify Karen Lefor and third party proceedings were taken by her claiming declarations that Pafco was required to defend the main action and to indemnify her for all sums she may become legally liable to pay as compensatory damages arising out of the allegations of negligence against her in the main action. After discoveries had been held, Pafco brought a motion for summary judgment dismissing the third party action, and a declaration that it was not required to defend or indemnify Karen Lefor. Marchand J. dismissed the motion for summary judgment and granted a declaration to the effect that "the accident occurred at least indirectly from the use of the motor vehicle in question".
[4] It was common ground before the motions court judge and before this court that there is no dispute as to the facts relevant to the issue of coverage under the policy. Although the matter proceeded by the way of interlocutory motion, it was treated as if the appellant had brought an application for declaratory relief and all parties asked both the motions court judge and this court to dispose of the matter on that basis. Ordinarily, findings made by a motions court judge dismissing a motion for summary judgment are not binding on the parties and the order dismissing the motion is interlocutory for the purposes of appeal: see V.K Mason Construction Group Ltd. v. Canadian General Insurance Group Ltd. (1998), 1998 14615 (ON CA), 42 O.R. (3d) 618, 42 C.L.R. (2d) 241 (C.A.). However, as a declaration was sought and as all parties have proceeded on the basis that the facts are not in dispute and that it is appropriate to dispose of the issue raised as a final declaration of a point of law, this court will ente rtain the appeal.
Analysis
[5] Pafco places heavy reliance on the decision of the Supreme Court of Canada in Law, Union & Rock Insurance Co. v. Moore's Taxi Ltd., 1959 81 (SCC), [1960] S.C.R. 80, 22 D.L.R. (2d) 264. That case involved a claim against a taxi company that transported children with special needs from their school to their homes. The driver allowed one of the children to cross the street to his home unescorted and the child was hit by another car. The taxi company was found liable for the accident and brought an action to recover indemnity against the appellant insurer under the terms of a comprehensive policy that excluded "claims arising out of . . . the ownership, use or operation . . . of any motor vehicle". The Supreme Court of Canada held that the risk was not excluded and that the taxi company could recover against its insurer. Ritchie J. held that the duty of the taxi company to the child was separate and distinct from the use and operation of a motor vehicle and that accordingly the exclusion did not apply. Ritchie J. stated, at pp. 84-85 S.C.R., p. 268 D.L.R., as follows:
It is sufficient to say that the words "claims arising out of . . . . the ownership, use or operation . . . of any motor vehicle" as used in this exclusion can only be construed as referring to claims based upon circumstances in which it is possible to trace a continuous chain of causation unbroken by the interposition of a new act of negligence and stretching between the negligent use and operation of a motor vehicle on the one hand and the injuries sustained by the claimant on the other. In the present case the motor vehicle was stationary at the time of the accident and the chain of causation originating with its use was severed by the intervening negligence of the taxi driver whose failure to escort the boy across the street was the factor giving rise to the respondent's liability.
[6] Law, Union & Rock Insurance Co. v. Moore's Taxi Ltd. must be read in light of the more recent judgment of the Supreme Court of Canada in Amos v. Insurance Corp. of British Columbia, 1995 66 (SCC), [1995] 3 S.C.R. 405, 127 D.L.R. (4th) 618. In that case, the plaintiff had been attacked and shot through the window of his motor vehicle by third parties attempting to force entry. The Supreme Court of Canada held that the plaintiff was entitled to recover under a statutory provision requiring the insurer to pay no fault benefits to an insured with respect to injury "caused by an accident that arises out of the ownership, use or operation of a vehicle". Writing for a unanimous court, Major J. specifically noted that provisions providing coverage in policies of insurance have been interpreted broadly in favour of the insured while exclusions have been interpreted strictly and narrowly against the insurer. Major J. went on to state that while the provision before him could not be stretched beyond its pla in and ordinary meaning, equally the court ought to avoid a narrow or technical construction to defeat the object and intent of providing insurance coverage. He set out, at p. 415 S.C.R., p. 624 D.L.R., the following two-part test to determine whether the accident "arises out of the ownership, use or operation of a vehicle":
Did the accident result from the ordinary and well-known activities to which automobiles are put?
Is there some nexus or causal relationship (not necessarily a direct or proximate causal relationship) between the appellant's injuries and the ownership, use or operation of his vehicle, or is the connection between the injuries and the ownership, use or operation of the vehicle merely incidental or fortuitous?
[7] Major J. further noted, at p. 419 S.C.R., p. 627 D.L.R., that "a motor vehicle need not be the instrument of the injury to satisfy the causal connection requirement. Injuries which do not arise from the negligent use of a motor vehicle may be covered . . .". He also stated, at p. 419 S.C.R., p. 628 D.L.R.: "Generally speaking, where the use or operation of a motor vehicle in some manner contributes to or adds to the injury, the plaintiff is entitled to coverage." Applying the two-part test, the Supreme Court of Canada held that the injuries suffered as a result of the attack by the armed third parties did arise out of the use or operation of a motor vehicle.
[8] I agree with the submission of the respondents that the amendment to the wording of the standard form motor vehicle liability insurance policy 1990 to provide coverage with respect to injuries arising "indirectly" as well as directly from the use or operation of a motor vehicle, strengthens their case. In view of that broad language and in view of the principles enunciated by the Supreme Court in Amos, supra, it is my view that the motions court judge correctly concluded that the accident arose from the ownership or directly or indirectly from the use or operation of Karen Lefor's motor vehicle. Netasha was being dropped off at her grandmother's house by her mother who was immediately proceeding in the automobile to a concert. Stopping vehicles to pick up and drop off passengers is an ordinary and well-known aspect of the use and operation of an automobile. There is a clear nexus, within the meaning articulated in the Amos case, between the use and operation of Karen Lefor' s vehicle and Netasha's injuries. The automobile was stopped temporarily, its motor still running, to drop off Netasha. The accident occurred as a result of the use of Ms. Lefor's vehicle as a means of conveying passengers from one place to another. Ms. Lefor's decision to park her car on the opposite side of the road from her mother's house and leave it running while she and her children darted across the street placed Netasha in a situation of danger and triggered the sequence of events that resulted in Netasha's injuries. The alleged negligence of Karen Lefor after she left her vehicle does not preclude coverage as, on the authority of Amos, supra, the motor vehicle need not be the instrument of the injury, and injuries which do not arise from the negligent use of a motor vehicle may be covered: see Incerto v. Landry (2000), 2000 22346 (ON SC), 47 O.R. (3d) 622 (S.C.J.) at p. 626, per Lax J.: "The liability for the injury may arise from a tortious act other than the negligent use of a motor vehicle . . . where the use or operation of a motor vehicle in some manner contributes to the injury, there is an entitlement to coverage."
[9] This case is clearly distinguishable from the circumstances in Alchimowicz v. Continental Insurance Co. of Canada (1996), 1996 1313 (ON CA), 37 C.C.L.I. (2d) 284, 22 M.V.R. (3d) 41 (Ont. C.A.). That case involved injuries suffered by a drunken person who had dived off a dock some 25 minutes after he had been driven to a beach site. In those circumstances, the use of an automobile was a remote background fact. I note as well that the British Columbia Court of Appeal held an insurer liable to indemnify in circumstances similar to those arising in the case at bar: Wu v. Malmas (1985), 1985 235 (BC CA), 21 D.L.R. (4th) 468, 67 B.C.L.R. 105 (B.C.C.A.).
[10] I note finally the somewhat unusual way in which the question of insurance coverage has been presented. This is not a case, like Non-Marine Underwriters, Lloyd's of London v. Scalera, 2000 SCC 24, [2000] S.C.J. No. 26, 185 D.L.R. (4th) 1 where at the pleadings stage, an insured seeks an order requiring an insurer to provide a defence on the basis of facts alleged in the statement of claim. In the case at bar, the insured moved for declaratory relief on the basis of a substantial factual record. All parties took the position, both before the motions court judge and before this court, that there was no dispute as to any fact relevant to the issue of coverage under the policy. Obviously, the issue of Karen Lefor's liability for damages must be determined at trial. However, the issue of her insurance coverage for any liability that might be found against her may, in these unusual circumstances, be resolved at this stage of the proceedings.
[11] It follows that Pafco is required to defend Karen Lefor with respect to the claim of the plaintiff and, to the extent that Karen Lefor is found liable, to indemnify her for such liability.
Conclusion
[12] For these reasons I would dismiss the appeal. The motions court judge granted a declaration in the following terms:
THIS COURT ORDERS that based on the determination of a question of law, the accident occurred at least indirectly from the use of the motor vehicle in question.
THIS COURT ORDERS that the motion is dismissed.
I would substitute for that language the following which achieves the same result but tracks the precise language of the appellant's motion:
THIS COURT ORDERS that the Third Party is obliged to indemnify the defendant Karen Lefor for any damage for which she may become legally liable to the plaintiffs in the main action;
THIS COURT ORDERS that the defendant, Karen Lefor, is entitled to a defence to the main action pursuant to the policy of motor vehicle liability insurance issued by the third party to the defendant Karen Lefor;
THIS COURT ORDERS that the motion for summary judgment dismissing the third party claim of the defendant, Karen Lefor, is dismissed.
[13] The respondents are entitled to their costs of this appeal.
Appeal dismissed.