ONTARIO
SUPERIOR COURT OF JUSTICE
COURT FILE NO.: CV-08-11058CM
DATE: 20121015
BETWEEN:
Ashley Jubenville and Kelly Jubenville Plaintiffs – and – Kevin Jubenville, Wawanesa Mutual Insurance Company and Superintendent of Financial Services and Economical Mutual Insurance Company/Economical Compagnie Mutuelle D’Assurance Defendants
Laura M. Pearce, for the Plaintiffs
Kevin Jubenville, acting in person Michael Stocks, for the Defendant Superintendent of Financial Services Lauren N. Bloom, for the Defendant Economical Mutual Insurance Company/Economical Compagnie Mutuelle D’Assurance
HEARD: October 1, 2012
Thomas J.:
Nature of the Motion
[ 1 ] This is a motion brought with the consent of all parties pursuant to rule 22.01 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, for the determination of a question of law in the form of a special case. Rule 22.01 states the following:
Where the parties to a proceeding concur in stating a question of law in the form of a special case for the opinion of the court, any party may move before a judge to have the special case determined.
Where the judge is satisfied that the determination of the question may dispose of all or part of the proceeding, substantially shorten the hearing or result in a substantial saving of costs, the judge may hear and determine the special case.
[ 2 ] The special case requires an answer to the following question: Was the Mercury Cougar, owned by, registered to and driven by Kevin Jubenville on the date of the accident an “uninsured automobile” as defined in the O.P.F 1, s. 265 of the Insurance Act and under policy number 9556129?
[ 3 ] In considering the applicability of the rule, and in particular rule 22.01(2), I am content that the determination of this question will allow for either Economical Mutual Insurance Company (“Economical”) or the Superintendent of Financial Services (“Superintendent”) to withdraw as a defendant and will shorten the hearing.
Background
[ 4 ] As part of the parties’ consent to frame the motion in this fashion they have kindly produced the following agreed statement of facts that forms the background driving the question:
The Plaintiff, Kelly Jubenville (“Kelly”) and the Defendant, Kevin Jubenville (“Kevin”), were legally married on December 19, 1987 in the Province of Ontario.
Ashley Jubenville (“Ashley”) was born on May 12, 1988.
Kevin and Kelly are the parents of Ashley.
At all material times, Ashley was a dependent relative of Kelly.
Kelly was the named insured under a policy of automobile insurance issued by Economical that was in force from June 19, 1992 to June 19, 1993, under policy number 9556129, with a $500,000.00 liability limit (“the policy”).
The policy was in the standard form (O.P.F. #1).
The policy included coverage for two vehicles, a Pontiac Fiero and a Dodge Shadow.
On May 23, 1993 Ashley (then 5 years old) was injured in a single vehicle motor vehicle accident while riding as a passenger in her father’s 1985 Mercury Cougar (“the Defendant’s vehicle”).
The Defendant’s vehicle was owned and registered in the name of Kevin.
Kevin was driving the Defendant’s vehicle at the time of the accident.
Kevin claims to have had coverage through TD Insurance at the time of the accident, however for the purposes of this motion, it is agreed there is no coverage and that the Defendant’s vehicle was uninsured.
Pursuant to the terms of a Divorce Judgment, dated April 27, 1993, Kelly and Kevin were legally divorced on May 28, 1993.
Ashley commenced an action for coverage under the Uninsured Automobile Coverage provisions of Kelly’s policy on September 13, 2011.
Policy and Statutory Provisions
[ 5 ] The resolution of this question requires consideration of the following sections of the standard automobile policy in effect on May 23, 1993 at the time of this accident:
4.1 The insurer agrees to pay all sums that,
4.1.1 a person insured under the Policy is legally entitled to recover from the owner or driver of an uninsured automobile or unidentified automobile as damages for bodily injury resulting from an accident involving an automobile;
4.2.2 “person insured under the policy” means, [...]
(c) in respect of a claim for bodily injury or death,
(ii) the insured and his or her spouse and any dependent relative of either,
- While an occupant of an insured automobile, [...]
4.2.4 “uninsured automobile” means an automobile with respect to which neither the owner nor driver thereof has applicable and collectible bodily injury liability and property damage liability insurance for its ownership use or operation, but does not include an automobile owned by or registered in the name of the insured or his or her spouse. (O.P.F. 1 – Ontario Automobile Policy Form 1, Part D – Uninsured Automobile Coverage, s. 4.1 and 4.2 (excerpts)).
[ 6 ] Section 265 of the applicable Insurance Act , R.S.O. 1990, c. I8, as amended to May 23, 1993 contains the following terms as they relate to uninsured automobile coverage. These sections are for our purposes identical to the policy terms set out above.
Uninsured automobile coverage – Every contract evidenced by a motor vehicle liability policy shall provide for payment of all sums that,
(a) a person insured under the contract is legally entitled to recover from the owner or driver of an uninsured automobile or unidentified automobile as damages for bodily injuries resulting from an accident involving an automobile;
For the purposes of this section, “person insured under the contract” means, [...]
(c) in respect of a claim for bodily injuries or death,
(ii) the insured and his or her spouse and any dependent relative of either,
A. while an occupant of an uninsured automobile,
“uninsured automobile” means an automobile with respect to which neither the owner nor driver thereof has applicable and collectible bodily injury liability and property damage liability insurance for its ownership, use or operation, but does not include an automobile owned by or registered in the name of the insured or his or her spouse.
[ 7 ] While “insured” is not defined in s. 265 of the Insurance Act , it is defined in s. 224 in the terms set out below. It should be noted that both ss. 224 and 265 are found in Part VI of the Act:
In this Part, [...] “insured” means a person insured by a contract whether named or not and includes every person who is entitled to no-fault benefits under the contract whether or not described therein as an insured person.
Positions of the Parties
[ 8 ] The defendant, Economical, takes the position that the language of s. 265 and the standard form policy is clear and unambiguous. Kelly and Kevin were spouses at the time of the accident (a fact which seems clear and was not disputed). Policy reasons dictate that a domestic couple should not be able to benefit from insuring only one vehicle in a family setting where more than one vehicle is owned or registered.
[ 9 ] Economical argues that when one considers the context of the term “the insured” the conclusion should be obvious. In s. 265 “the insured” must in fact mean “the named insured” or in our case, Kelly Jubenville. If that is so, then Ashley is unable to look to the Economical policy for coverage since although she is a dependent of Kelly the uninsured vehicle in which she was riding was owned and driven by Kelly’s spouse Kevin and as such is excluded by operation of s. 265(2) (c) of the Insurance Act .
[ 10 ] It is Economical’s position that Ashley must look to the defendant Superintendent and the Motor Vehicle Accident’s Claims (“MVAC”) Fund.
[ 11 ] The answer to the stated question would then be, “no”.
[ 12 ] The plaintiff and the defendant Superintendent take the same position. Relying upon the recent evolution of cases from the Court of Appeal and this court (discussed below), they argue that the term “insured” should be given a broader definition than urged by Economical. Considering the remedial nature of the legislation, and informed by the s. 224 definition, they urge that the term as used in the exclusionary clause must mean “the person making the claim” (in this case Ashley). Since Ashley is a dependent of Kelly and has no spouse she must have the benefit of this policy. The answer to the question would then be “yes”.
Analysis
[ 13 ] Let me say at the outset that I agree with the position of the plaintiff and the Superintendent.
[ 14 ] In my view all of the following principles favour the plaintiff’s access of the Economical policy:
There are established principles governing the interpretation of insurance contracts. Coverage provisions are to be interpreted broadly and exclusions narrowly. Ambiguities are resolved in favour of the insured: see Matt v. Crawford , 2010 ONSC 3980 , [2010] O.J. No. 3622 (S.C.J.) at para. 11 .
[ 15 ] I appreciate that Quinn J. in Fosker v. Thorpe , 2004 33358 (ON SC) , [2004] O.J. No. 4187 (S.C.J.) held that s. 265(2) was clear and unambiguous but that came as a case where the injured plaintiff, Fosker, owned the vehicle and was insured under the policy. That is not the situation that presents itself with Ashley Jubenville.
[ 16 ] It must be remembered that one of the main objectives of the Insurance Act is consumer protection ( Loftus v. Robertson (2008), 2008 37214 (ON SC) , 92 O.R. (3d) 384 at para. 21 , aff’d 2009 ONCA 618 ). The legislative intent was to internalize the costs to the activity of driving and not externalize it to the general public who would fund the MVAC Fund. Section 265 of the Insurance Act was therefore to be seen as remedial and given a broad and liberal interpretation ( Chambo v. Musseau , 1993 8680 (ON CA) , [1993] O.J. No. 2140 (O.C.A.) at para. 11 ).
[ 17 ] As a result we see the trilogy of decisions from the Ontario Court of Appeal in Taggart (Litigation Guardian of) v. Simmons (2001), 2001 24003 (ON CA) , 52 O.R. (3d) 704 (O.C.A.) (“ Taggart ”), Foster v. Young , 2002 CarswellOnt 3225 (O.C.A.) , McArdle v. Bugler , 2007 ONCA 659 (“ McArdle ”).
[ 18 ] Economical maintains that these cases can be distinguished as the court was searching for coverage for the plaintiff to achieve a fair and just result, whereas here coverage for Ashley is available through the MVAC Fund. While that may be true, the findings of the court are clear, direct and inform a broader view of the term “the insured” contained in s. 265(2) .
[ 19 ] Laskin J.A. said the following in Taggart at paras. 19 and 20 :
Section 265(1) mandates uninsured automobile coverage for “a person insured under the contract”. The definition in s. 265(2)(c)(ii) of a “person insured under the contract” includes the “insured”. While “insured” is not further defined in s. 265 , it is defined in s. 224(1) which explicitly defines the term for the purposes of Part VI of the Act. That part governs automobile insurance and includes s. 265. There is nothing in s. 265 to negate the clear legislative intention that the definition of “insured” in s. 224(1) applies to s. 265(2) (c)(ii). The phrase at the beginning of s. 265(2) “for the purposes of this section” cannot be read as “for the purposes of this section and without regard to s. 224(1)”.
The s. 224(1) definition of “insured” includes every person who is entitled to statutory accident benefits under the policy.
[ 20 ] In McArdle , Rosenberg J.A. writes at para. 8:
The appellant argues that Taggart offers a clear answer to the central question in this case: the expanded definition of “insured” in s. 224 informs the narrower definition of “person insured under the contract” in s. 265 . If a plaintiff is entitled to statutory accident benefits, then he or she is also entitled to uninsured motorist coverage. Thus, through a straightforward application of Taggart, Ms. McArdle being entitled to statutory accident benefits under the Emmons policy is similarly entitled to the additional uninsured motor vehicle coverage under the Emmons policy. In an interesting argument, Mr. Charney, counsel for Coseco, resists that conclusion. I will now turn to those submissions.
[ 21 ] And then at para. 25:
In summary, a step to finding that Mr. Taggart was entitled to UIM coverage was that he could fall within the definition of “insured” in s. 224 as a person entitled to SABs. The application of that part of Taggart cannot be limited as suggested by Coseco to the narrower issue of the meaning of “relative” in s. 265 . Accordingly, it seems to me that for Coseco to succeed in this appeal, it must show that Taggart should be overruled.
[ 22 ] In comments made later in McArdle , Rosenberg J.A. concluded that he was not in a position to overrule Taggart and that none of these more recent arguments were likely to have changed the result in any event.
[ 23 ] Finally, D. Brown J. in Wing v. 1198281 Ontario Ltd ., 2006 42263 (ON SC) , [2006] O.J. No. 5040 (S.C.J.) (“ Wing ”), tackled a fact situation similar to the one at bar. Wing was a designated driver on a fleet insurance policy owned by his boss Amyotte. Wing attempted to assist Amyotte with another vehicle owned by Amyotte but uninsured. Wing was injured. Royal Insurance which insured the fleet disputed access to its policy by Wing. D. Brown J. found the following at paras. 22 and 23:
To accede to the interpretation of “uninsured automobile” advanced by Royal would reduce the number of persons covered by the uninsured automobile provisions of a policy, especially in cases involving fleet policies of insurance, and require more claimants to look to the Fund for compensation. This would run counter to the intent of the Act to internalize the costs resulting from injuries caused by uninsured automobiles. It would also go against the grain of the general principle that exclusions in insurance contracts should be interpreted narrowly: Snaak (Litigation Guardian of) v. Dominion of Canada General Insurance Co . (2002), 2002 44897 (ON CA) , 61 O.R. (3d) 230 (C.A.).
To interpret “the insured” as referring only to the plaintiff and not to Mr. Amyotte in the circumstances of this case in my view produces a fair result. If Mr. Amyotte had suffered the injury instead of the plaintiff, one could understand Royal pointing to the exclusion clause and saying, “You had the chance to insure all of your vehicles with us; you cannot expect to look to us when you deliberately chose not to insure the vehicle that caused the injury.” It is quite another matter for Royal to deny coverage to the plaintiff when he had no ability to insure the Jeep owned by Mr. Amyotte.
[ 24 ] Economical urges that I can distinguish Wing as the plaintiff was a named designated insured in the fleet policy. I am not sure how that assists the defendant Economical, but in any event there is no place in the decision where D. Brown J. provides that fact as assisting in his conclusion. In fact it seems from the passage above to be quite the opposite. The essence of Wing is that the term “the insured” in s. 265(2) is the person who brings the claim.
[ 25 ] This analysis applies equally to the relevant section and the almost identical terms of the policy itself.
[ 26 ] As a result I find the following: The terms of s. 265(2) of the Insurance Act do not operate to exclude Ashley Jubenville. The exclusion should be interpreted narrowly. Ashley, at age five, had no ability to effect the insurance coverage arrangements of her parents just as Wing could not effect the actions of Amyotte. It is not in dispute that she is entitled to statutory accident benefits and it seems she did in fact collect benefits. Therefore, Kevin Jubenville’s Mercury Cougar was an “uninsured automobile” as defined by O.P.F. 1, and s. 265 of the Insurance Act and the answer to the special case question is “yes”.
[ 27 ] It would seem to me that the Superintendent of Financial Services could now withdraw as a defendant in this action. I leave that issue to the parties.
[ 28 ] I have been advised that all counsel are requesting a “no costs” endorsement and so that result forms part of my order.
Original signed “Justice Thomas”
Bruce G. Thomas
Justice
Released: October 15, 2012
COURT FILE NO.: CV-08-11058CM
ONTARIO SUPERIOR COURT OF JUSTICE BETWEEN: Ashley Jubenville and Kelly Jubenville Plaintiffs – and – Kevin Jubenville, Wawanesa Mutual Insurance Company and Superintendent of Financial Services and Economical Mutual Insurance Company/Economical Compagnie Mutuelle D’Assurance Defendants REASONS FOR JUDGMENT Thomas J.
Released: October 15, 2012