Guarantee Co. of North America et al. v. Mercedes-Benz Canada Inc. et al.

[Indexed as: Guarantee Co. of North America v. Mercedes-Benz Canada Inc.]

86 O.R. (3d) 479

Court of Appeal for Ontario,

Doherty, Blair and LaForme JJ.A.

June 13, 2006

Limitations -- Motor vehicles -- Damages occasioned by motor vehicle -- Plaintiff's motor vehicle damaged by fire which was allegedly caused when transmission fluid leaked onto exhaust manifold while car was parked -- Motion judge correctly concluding that he was bound by precedent to find that damage was occasioned by motor vehicle and that two-year limitation period in s. 206(1) of Highway Traffic Act applied -- Highway Traffic Act, R.S.O. 1990, c. H.8, s. 206(1).

The plaintiff's parked motor vehicle was damaged beyond repair in a fire which was allegedly caused when transmission fluid leaked onto the exhaust manifold. The plaintiff brought an action alleging that the transmission dipstick was improperly installed, replaced or removed. The defendant moved successfully for summary judgment dismissing the action against it as statute-barred by the two-year limitation period in s. 206(1) of the Highway Traffic Act. The plaintiff appealed.

Held, the appeal should be dismissed. [page480]

The motion judge correctly concluded that he was bound by the decision in Karakas v. General Motors of Canada Ltd. to find that the damage resulting from the fire was damage occasioned by a motor vehicle, so that s. 206(1) of the Highway Traffic Act applied. The Court of Appeal was not asked to overrule Karakas, and this case could not be distinguished from Karakas.

APPEAL from the order of Jenkins J. (2005), 2005 ONSC 79671, 83 O.R. (3d) 316, [2005] O.J. No. 6149 (S.C.J.), granting a motion for summary judgment.

Cases referred to Heredi v. Fensom, [2002] 2 S.C.R. 741, [2002] S.C.J. No. 48, 219 Sask. R. 161, 213 D.L.R. (4th) 1, 289 N.R. 88, 272 W.A.C. 161, [2002] 8 W.W.R. 1, 2002 SCC 50, 25 M.V.R. (4th) 85, 12 C.C.L.T. (3d) 1, 19 C.P.C. (5th) 1; Karakas v. General Motors of Canada Ltd., [2005] O.J. No. 2462, 19 M.V.R. (5th) 137 (C.A.), affg (2004), 2004 ONSC 48168, 74 O.R. (3d) 273, [2004] O.J. No. 5231, 10 M.V.R. (5th) 301 (S.C.J.), consd

Greg Van Berkel, for appellants. Jason Murphy, for respondent Mercedes-Benz. Jonathon Kahane-Rapport, for respondent 872063 Ontario Limited.

[1] Endorsement by THE COURT: -- There is arguable merit to the appellants' claim that the result and reasoning in Karakas v. General Motors of Canada Ltd. (2004), 2004 ONSC 48168, 74 O.R. (3d) 273, [2004] O.J. No. 5231 (S.C.J.), affd [2005] O.J. No. 2462, 19 M.V.R. (5th) 137 (C.A.) is at odds with the principles enunciated in Heredi v. Fensom, 2002 SCC 50, [2002] 2 S.C.R. 741, [2002] S.C.J. No. 48. We are not, however, asked to overrule Karakas.

[2] We cannot agree with the appellants' valiant attempts to distinguish Karakas. Nor do we agree that the motion judge found that the automobile was "ancillary" to the damage caused. The motion judge found that he was bound by Karakas. We agree. This case cannot be distinguished from Karakas. Appeal dismissed.

[3] Costs to the respondent, Mercedes-Benz Canada Inc., in the amount of $5,000, inclusive of disbursements and GST.

Appeal dismissed.