COURT FILE AND PARTIES
COURT FILE NO.: CV-12-456090-00A1
DATE: 20151204
SUPERIOR COURT OF JUSTICE - ONTARIO
RE: Nirushan Francis and Margaret Francis, Plaintiffs
-and-
Tyrell Williams, Dynamic Leasing Canada Inc., Waliz Inc. o/a 4 A’s Car Rental and Wawanesa Mutual Insurance Company, Defendants
-and-
RBC General Insurance Company, Third Party
BEFORE: F.L. Myers J.
COUNSEL:
R. O’Leary counsel, for the third party RBC General Insurance Company
B. Ridout counsel for defendants, Dynamic and Waliz Inc. o/a 4 A’s Car Rental
HEARD: December 3, 2015
ENDORSEMENT
[1]
Overview
Auto insurance for rental cars is highly regulated in Ontario. The standard policy addresses it as does the Insurance Act, R.S.O. 1990 c. I.8. It is common in car accident cases involving a rental car to find an insurer moving to lay-off liability on another insurer under the priorities ladder set out in section 277 of the Act.
2Here, the rental company is hoping to tag the insurer of the driver with liability. The issue is whether the driver, Mr. Williams, was insured. RBC insures Mr. Williams’ mother. Under the terms of the policy related to rental car insurance, §2.2.4, only the insured specifically named in the Certificate and her spouse are covered. Children are not apparently covered. This fits with the priority ladder in s.277(1.1)(2) that speaks of liability for a driver, “as an insured named in the contract, as spouse of an insured named in a contract… or as a driver named in the contract…” Therefore, even if Mr. Williams is an unnamed insured under his mother’s policy, RBC would still not be obliged to respond in priority to the rental company’s insurer. Only an insured named in the contract triggers priority liability under s.277(1.1)(2).
3The rental company wants to examine Mrs. Williams, Mr. Williams, and RBCs underwriting file. They have received a third-party industry report showing that RBC paid over $5,000 in accident benefits to Mr. Williams. That is some evidence that Mr. Williams is indeed insured under the policy. It is not conclusive, however. The reporting service may be wrong. Or RBC may have made an error. The statutory accident benefits scheme strongly favours payments by insurers and provides them with an ability to be indemnified if it later turns out that another insurer ought to have been the accident benefits payor.
4But the third-party report at least creates an issue as to why RBC paid. RBCs witness on the motion attended cross-examination unprepared. He had no information about RBCs underwriting or its accident benefits payments. Counsel refused to provide RBCs underwriting file on the basis that prior applications are irrelevant, since the only named insured is Mrs. Williams. Moreover, counsel for the rental company did not ask for production of the accident benefits file. He did not summons a witness. He did not move for directions under rule 1.05 or rule 50.13, as suggested in Hyrniak v. Mauldin, 2014 SCC 7, at paragraph 70. Rather, he argues that the rental company is entitled to explore the issue at discovery and trial. He ignores paragraph 49 of Hyrniak in which the court specifically said that summary judgment is not just a way to weed out weak cases any more. It is a substantial alternative resolution process where it is in the interest of justice to proceed summarily. Trial is no longer the default process.
[5]
Analysis
Here, there are two possible issues. First, was Mr. Williams an unnamed insured at the time of the accident? Second, if he was, can the rental company’s insurer lay-off its liability on RBC? I am not comfortable resolving the first issue on the current record. RBC had the sole ability to explain if it paid accident benefits to Mr. Williams and, if so, why. It cannot present an uninformed witness, withhold relevant files, and expected a judge to be comfortable under paragraph 59 of Hyrniak that she or he has sufficient evidence to decide the issue summarily in the interests of justice. Would this be the deciding point, I would be inclined to adjourn on directions for delivery of further evidence by RBC and follow-up cross-examination out-of-court. But the first issue is not determinative. Even if Mr. Williams is an insured person under his mother’s policy, there is no coverage for him for rental car driving under §2.2.4 because he is not a named insured or her spouse and coverage under that section is narrow and relates to liability as renter rather than as driver. Similarly, even if Mr. Williams were an unnamed insured person under §3.3 of the policy qua driver, RBC still is not required to respond to this claim under s.277(1.1)(2) of the Act ahead of the rental company’s insurer.
[6]
Conclusion
This decision simply turns and the words “insured named in the contract,” used three times in that section. It is conceded that Mr. Williams is not a named insured. Moreover, under the wording of the policy, the named insured is determined solely by looking at the people named in the Certificate of Insurance. There is no factual issue requiring resolution of this question. I have the policy and Certificate before me. I am confident I can find the fact of who is named in the Certificate based on reading it and I can apply the law to that fact efficiently, affordably, and proportionately. Therefore, the third-party claim is dismissed.
7It is no longer sufficient under Hryniak to decline to take available procedural steps and arrive at the motion asking for discovery. Counsel could have sought directions for discovery or availed themselves of case management, at Civil Practice Court. Summary judgment is not a dry run for trial. Counsel need be prepared to be held to their procedural and tactical choices. While I was not content to grant judgment on the first question, the second question is a discrete issue that is determinative. There is no reason to go to discovery now once the action is resolved on a different point. By holding back, the rental company lost its opportunity to inquire further. In the end, it saved time and money as the outcome of inquiries of whether Mr. Williams was an unnamed insured would not have affected the outcome. But the procedural message is that if you want to explore an issue in face of a motion for summary judgment, do it upfront or seek directions if necessary.
F.L. Myers J.
Date: December 4, 2015