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Snow Slide Slip Suit Slushed

 Dec 16, 2016 10:17 AM
by Neil Colville-Reeves

Ontario’s Superior Court has provided further direction on the standard of care of occupiers, this time in the context of a municipality operating a snow slide at a winter festival.

In Martin et al v The Corporation of the City of Barrie et al, the slide was described as a large pile of snow capped off with a decorative ice sculpture with separate chutes on which guests would slide. The plaintiff descended the larger of two slides and struck what she thought was a piece of ice hidden underneath the snow. She sustained injury as a result.

The plaintiff testified that after she struck the piece of ice, she heard a festival staff member indicate that the hole had to be filled in ‘again’. The plaintiff argued that this utterance was proof that the slide was unsafe and that festival staff were aware of the safety issue. Festival staff was provided with training relating to slide maintenance and customer service issues, and were on site to ensure proper use and to assist people to clear the area after use and were provided with shovels to smooth and fill in the landing area, given that it was expected the landing would be worn away by heavy use. There was no scheduled closure for maintenance.

In finding that the City did not breach the standard of care of an occupier, the court noted that the very activity engaged in by the plaintiff is one that entails certain risks that are known and assumed by participants. That alone does not negate liability, however as the City was still required to take steps to ensure the slide was reasonably safe in the circumstances. On this issue, the court noted that the slope was neither high nor steep and that festival staff were located at the top and the bottom of the slide to assist participants and to manage the condition of the slide on an ongoing basis. The defendant argued that the employees post incident utterance of filling in the hole again was evidence of reasonable measures taken by the City to manage the safety of the slide.

It is noteworthy that the court found no liability despite accepting the plaintiff’s argument that a more rigorous inspection protocol could have uncovered the hazard. Consistent with jurisprudence on what constitutes ‘reasonable’ steps to ensure safety, the court identified that this question must be asked and answered in the context of the activity in question. In this case, the plaintiff’s injuries, which were found to be casually related to her use of the slide, were the consequence of her voluntary assumption of risk.

See Martin et al v The Corporation of the City of Barrie et al, 2016 ONSC 7830 (CanLII)


Neil Colville-Reeves

Neil is a Partner of Samis+Company. Neil focuses exclusively on insurance-related litigation. He has handled a broad range of matters before the Ontario Superior Court of Justice and the Financial Services Commission of Ontario, as well as advocating on behalf of his clients in private arbitrations.

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Courts, Occupiers Liability, Torts  
  

Another Ridesharing Policy, Another Underlying Risk

 Dec 9, 2016 2:35 PM
by Daniel Strigberger

Another insurer has entered into Ontario’s ridesharing insurance market. Effective December 1, 2016, Northbridge Insurance provides ridesharing coverage for users of RideCo., a Waterloo Region-based ridesharing company. The new product seeks to fill existing coverage gaps under Ontario’s standard Ontario Automobile Policy (OAP 1) when insureds are using their vehicles for RideCo. However, the new policy still leaves coverage questions about how the new policy interplays with the vehicle’s underlying policy.

Background

Like UberX, RideCo is an online, app-based ridesharing company that operates in Waterloo Region. According to its Web site:

RideCo lets you book personalized, express transit service. You simply search and book a ride on our mobile app. Our technology will do the work to schedule professional transportation to fulfill your ride booking. What is unique is that you will share that ride with other passengers, therefore making it affordable—near to the cost of driving yourself. RideCo’s technology ensures that your rides will be fast, without ever being too crowded.

Like UberX, RideCo uses “driving partners” to service its users. Driving partners are drivers who use their personal vehicles to driver RideCo passengers from Point A to Point B, for a fee.

However, section 1.8.1 of the OAP 1 contains an exclusion that precludes coverage if the vehicle is being used as a taxicab or to carry paid passengers. This means that every time a RideCo driving partner is using her vehicle to deliver RideCo passengers, her policy does not provide Ontario’s mandatory automobile insurance coverage. This would expose the owner and driver to personal liability and potential charges for driving without insurance.

New Ridesharing Policy

RideCo’s policy bares many similarities to UberX’s policy (unveiled in July 2016). The new policy is a fleet policy that is issued directly to RideCo Inc. The named insureds under the policy include RideCo and any “rideshare driver” or “rideshare vehicle owner” – when they are logged into the RideCo app.

There is no coverage under the policy when the driver is not logged onto the RideCo app. If the driver is not logged in, coverage under the driver/owner’s personal policy for the automobile (the underlying policy) is applicable.

Like the UberX policy, the RideCo policy becomes “primary” over the underlying vehicle policy when it is triggered. It provides standard coverage during the “Pre-Acceptance Period” (the period starts when the driver logs into the app and ends when the driver accepts a delivery request) for accident benefits, uninsured motorist coverage, third party liability coverage ($1 million limits), and Family Protection Coverage (1 million limits). If the driver has collision and comprehensive coverage on their personal policy, the RideCo policy will also provide those coverages with a $1,000 deductible.

When a driver accepts a ride request, the liability and Family Protection limits double ($2 million). This “Post-Acceptance Period” ends when the last passenger departs from the automobile or the trip is ended or cancelled, whichever is later.

Interestingly, the RideCo policy also offers two additional coverages during the Post Acceptance period: Up to $1,500 for transportation replacement (OPCF 20) and the Removing Depreciation Deduction (OPCF 43) – but only if the underlying policy insuring the vehicle has those coverages in force at the time of a loss.

Old Ridesharing Risks

When UberX announced its new Intact policy in July, I cautioned that underlying insurers might not want to be “underlying vehicle insurers” if their insureds are using their vehicles for ridesharing activities. The RideCo and UberX policies do not necessarily remove all of the risks that underlying vehicle insurers face when their insureds are using their vehicles to drive for those companies.

FSCO cautions ridesharing drivers about driving without consulting their underlying insurers first:

If you use or drive for other ridesharing companies, you may not be protected under your own personal auto policy against certain damages and losses or in case of injury to yourself or others.

Find out if you’re covered. Check with your auto insurance representative and ridesharing company. The proper coverage must protect vehicle owners, drivers, passengers and others.

Northbridge’s RideCo webpage provides a similar warning and hints at a possible business opportunity for insurers that do wish to embrace ridesharing activities [emphasis in original):

All RideCo drivers are automatically covered by Northbridge Insurance’s commercial policy without having to contact Northbridge Insurance†. However, all drivers must first ensure their personal auto policy allows for their vehicle to be used for ridesharing. Please inform your personal auto insurance broker of your ridesharing activities to ensure you can be covered by Northbridge Insurance’s commercial policy.

Ridesharing not allowed under your policy?

Talk to your insurance broker about other personal auto insurance options that will allow for ridesharing.

It will be interesting to see whether underlying insurers will support or avoid insuring vehicles that are involved with insured ridesharing activities.

For more on the UberX policy, see my September 2016 article in Canadian Underwriter called Fleet’s In

Coverage, Sharing Economy  
  

A Likely Result For Not Building With Like Kind And Quality

 Dec 8, 2016 3:00 PM
by Samis + Company

The Ontario Court of Appeal clarified the concept of replacement cost property coverage in the recent decision of Carter v. Intact Insurance.

Property insurance policies generally provide for the basis of valuation, which is the manner in which a loss will be quantified. There are two common types of valuation in property policies: actual cash value and replacement cost.

Take, for instance, the case of a fire damaging a television that is four years old. A policy providing only actual cash value would take the cost of the television when it was new and apply a reduction (usually a percentage) for depreciation. Therefore, the policyholder would not receive enough money to buy a new television. If, on the other hand, the policy provided for replacement cost coverage, the policyholder would be entitled to the cost of a new television of the same type and quality as the damaged one. 

Often, replacement cost coverage is available as an endorsement (an addition to the policy providing additional coverage) to a property policy. Moreover, policies often specify that the policyholder must replace or repair damaged property within a specified time frame, such as two years, in order to qualify for the replacement cost coverage, preventing people from profiting from the insurance. The insurer will generally pay the actual cash value of the damaged property and will then pay the further amounts owing for replacement cost once the property is replaced (assuming replacement cost coverage was purchased). 

In the case of Carter v. Intact, the policyholder owned and insured a series of small apartment buildings on one property. A fire caused substantial damage to the buildings and the owners demolished and rebuilt everything. The issue, however, is that the new apartments were very different from the old ones. Originally, there were 15 residential units in small one, two and three storey buildings with a total of 51,000 square feet of floor space. The new condo building, however, was eight and a half storeys high, contained 129 residential units, and over 193,000 square feet of floor space.

The Court of Appeal determined that the policyholder was not entitled to replacement cost coverage, despite having the endorsement, as the building was not replaced with "like kind and quality", wording that is often used in connection with replacement cost coverage. Simply put, the policyholder replaced their property with something that was bigger and better. The Court noted that the building had not been "replaced" within the meaning of the policy. 

In summary, when reviewing property policies, it is important to determine whether the basis for valuation is actual cash value or replacement cost. Even if replacement cost coverage is available, there might be certain requirements that need to be met in order to qualify for the coverage, such as making replacements within a given time period and replacing property with "like kind and quality". 

See Carter v. Intact, 2016 ONCA 917 (CanLII)

Courts, Property  
  

Occupiers Liability Claim leaves Hotel Mopped

 Dec 8, 2016 11:27 AM
by Neil Colville-Reeves

In the recent case of Brown v. Marriott, Ontario’s Superior Court provided further guidance on the obligation of occupiers to take reasonable measures to ensure persons entering on premises are reasonably safe.

The facts were not in dispute and when they are reviewed, it is clear (perhaps only in hindsight) that the writing was on the wall.

Briefly, the plaintiff slipped on a recently mopped floor in a hotel lobby and sustained injuries as a result. The entirety of the accident circumstances, from the time the plaintiff entered the premises until the fall, was captured on a security camera. The court noted that the plaintiff was in no particular rush. The existence of an entirely documented sequence makes this case unique given that security camera tape is often incomplete, usually providing fragments of the circumstances of an incident. The video depicted the plaintiff entering the lobby and speaking with a guest services representative of hotel. While that conversation took place, a cleaner employed by the hotel began to mop the area behind the plaintiff. The cleaner had placed one caution sign in the area that was recently mopped.   The Guest Services employee was aware of the ongoing cleaning but did not mention it to the plaintiff, who was eventually directed to the elevator which required that he walk through the recently mopped area of the floor. He slipped and was injured. The General Manager of the hotel gave evidence that the Guest Services representative was required, as part of the hotel’s protocol, to advise the guest of the recently mopped floor. Moreover, the cleaner only placed one warning sign which did not accurately demarcate the area of danger.

The hotel was found liable as a result.

The takeaway: reasonable measures taken by an occupier to ensure safety usually requires an inspection protocol in place. If they do not have one, or if they have one and do not follow it, liability is likely to follow.

In this case, based on the facts agreed to by both plaintiff and defendant, the writing was on the wall.

See Brown v Marriott, 2016 ONSC 7619 (CanLII).


Neil Colville-Reeves

Neil is a Partner of Samis+Company. Neil focuses exclusively on insurance-related litigation. He has handled a broad range of matters before the Ontario Superior Court of Justice and the Financial Services Commission of Ontario, as well as advocating on behalf of his clients in private arbitrations.

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Courts, Occupiers Liability, Torts  
  

When it comes to coverage for bicycle and foot couriers, WSIB delivers

 Dec 8, 2016 10:00 AM
by Samis + Company

The Workplace Safety and Insurance Appeals Tribunal (WSIAT) recently released an important award confirming the WSIB policy that bicycle couriers and foot couriers are considered workers and, therefore, are entitled to coverage under the Workplace Safety and Insurance Act.

This section 31 application arose as a result of a bicycle/motor vehicle accident in downtown Toronto. The accident occurred when a courier truck pulled out from a curb and struck a bicycle courier. At the hearing, the respondent conceded that the courier driving the truck was a worker, in accordance with the Workplace Safety and Insurance Act. The Vice-Chair determined that both couriers were in the course of their employment at the time of the accident.

The main issue in the dispute was whether the injured bicycle courier was considered a worker or an independent contractor at the time of the accident. If she was considered a worker, she would have coverage under the Workplace Safety and Insurance Act. Given that the courier driving the truck was also a worker under the same Schedule, this would mean that the bicycle courier was not entitled to sue for her injuries and, consequently, would also not be entitled to accident benefits.

WSIAT has released a number of cases outlining various criteria which assist in determining whether a courier is considered a worker or an independent contractor for the purpose of coverage. As such, a significant amount of time at the hearing was devoted to addressing whether the bicycle courier in this case met these criteria.  The Vice-Chair addressed these criteria in his decision and determined that the facts established that the bicycle courier was a worker.

However, the Vice-Chair ultimately found that the usual worker/independent contractor criteria analysis was not required in light of the formal WSIB policy for determining worker/independent operator status of bicycle couriers or foot couriers in the courier industry. Specifically, he referenced the courier industry questionnaire which states:

Note: Couriers who collect or deliver on foot or by bicycle are considered workers and should not complete this questionnaire.

The Vice-Chair stated that the WSIB was legally entitled to develop this policy. He also stated that, while he was not legally bound by WSIB policies on a section 31 application such as this, it had long been recognised that it would be undesirable to ignore WSIB policies and create contradictory rules.

The Vice-Chair also stated that the industry-specific questionnaires are both useful and necessary in ensuring consistency in the application of WSIB policy. He also stated that the WSIB policy regarding bicycle couriers was quite strict which, in turn, negated the need to consider the usual worker/independent operator criteria. On the basis of this WSIB policy, the Vice-Chair found that the bicycle courier was a worker.

It is important for Insurers to be aware of circumstances where a claimant must apply to the WSIB for coverage. Specifically, section 61 of the Statutory Accident Benefits Schedule – Effective September 1, 2010 provides that an Insurer does not need to pay accident benefits when a claimant has coverage under the Workplace Safety and Insurance Act. Furthermore, while a person injured in a motor vehicle accident is normally entitled to elect to sue the negligent party, which then also allows them to claim accident benefits, they are not allowed to sue when both parties involved are considered workers in the course of their employment at the time of the loss, pursuant to the Workplace Safety and Insurance Act.

Some lawyers in the insurance industry, particularly plaintiff lawyers, may not be familiar with the circumstances that result in mandatory WSIB coverage. It is therefore important that Insurers be mindful of circumstances where a section 31 application may be required to determine if there is mandatory coverage through the WSIB.

See Decision No. 866/16.

 

Accident Benefits, Torts, WSIB / WSIAT  
  

All in Good Time: No Time Limit on Appraisals Under the Insurance Act

 Dec 6, 2016 3:27 PM
by Alexandra Wilkins

The Ontario Superior Court of Justice has recently found that there is no time limit to elect to proceed with an appraisal pursuant to Section 148 of the Insurance Act.

Recall that Section 148 of the Insurance Act gives insurers and insureds the right to elect appraisal when there is a disagreement as to the value of the property insured, the value of the property saved, and the amount of the loss. In the practical course, a proof of loss is submitted. If quantum is disputed, either the Insurer or Insured can invoke the appraisal process in writing. Each party has seven days to appoint an appraiser. The two appraisers then appoint an umpire. An agreement by any two of the parties resolves the quantum dispute.

An often contentious issue is whether the elect to proceed with appraisal is time sensitive.

In 56 King Inc. v. Aviva Canada Inc., the Plaintiff sought payment of insurance funds from Aviva for the costs of repairing structural damage, accounting costs, and damages for bad faith and punitive damages, allegedly due to Aviva’s denial of the claim under the policy. 

The structural damage was reported to Aviva on August 3, 2013 and coverage was denied on August 19, 2013. The Statement of Claim was issued on February 14, 2014 and the Statement of Defence was served on April 8, 2014. In August 2015, documentation in support of the Plaintiff’s claim for damages under the policy was received. By Request to Admit, dated January 7, 2016, Aviva agreed there was coverage under the policy.

By letter, dated January 25, 2016, Aviva elected to proceed with an appraisal.

The Plaintiff took the position that the appraisal process was not available to Aviva and refused to appoint an appraiser on its behalf. Aviva brought a motion for a declaration that the losses regarding structural damage and accounting were capable of being determined by appraisal. Aviva did not seek to have the claims related to bad faith and punitive damages determined by way of appraisal.

The main issue in 56 King was whether the appraisal process was not available due to the stage of the proceeding.  Ultimately, Justice Lofchik held that the appraisal process remained available to Aviva.

In coming to his decision, he emphasized that the appraisal wording in the Insurance Act is mandatory – “those questions shall be determined by appraisal.” Section 148 reads as follows:

11. In the event of disagreement as to the value of the property insured, the property saved or the amount of the loss, those questions shall be determined by appraisal as provided under the Insurance Act before there can be any recovery under this contract whether the right to recover on the contract is disputed or not, and independently of all other questions. There shall be no right to an appraisal until a specific demand therefor is made in writing and until after proof of loss has been delivered.

Justice Lofchik did not find Aviva’s “undue delay” argument pursuant to the Rules of Civil Procedure compelling, commenting that the Rules have no application to the mandatory procedure mandated by the provisions of the Insurance Act and that the appraisal process must be continually available, despite the commencement of an action. Justice Lofchik highlighted that there was no timeline in either the relevant policy or the Insurance Act that stipulates a deadline for which an election for appraisal must be made.

Similarly, Justice Lofchik found no prejudice on the Plaintiff by having the value of the covered loss adjudicated by the appraisal process. He commented that, in his view, the appraisal process may enable a determination to be made more expeditiously and allows for selection of an umpire that is well-versed in the matter.

Justice Lofchik also found that the Plaintiff’s allegation related to bad faith and punitive damages did not bar the right to an appraisal. He noted that the thrust of the appraisal process is taken out of the jurisdiction of the Court, but the Plaintiff’s right to have the other issues tried at trial is not.

This decision flies in the face of prior decisions of the Court which dismissed Insurers’ requests for appraisal due to the requests being brought too late. (see 1633092 Ontario Ltd and Ouellette Estate v. North Waterloo Farmers Mutual Insurance Company)

See 56 King Inc. v Aviva Canada Inc., 2016 ONSC 7139 (CanLII)


Alexandra practices insurance related litigation with a focus on accident benefits and bodily injury claims. 

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Courts, Legislation / Regulation, Property  
  

Fire Truck Fall is now an Accident

 Dec 5, 2016 11:14 AM
by Dan Inkpen

FSCO Director's Delegate Feldman has reversed an arbitration decision and has found that a child who fell off a parked fire truck at a birthday party was involved in an "accident".

In Carr v. TD, the incident involved a stationary fire truck, which was parked at a private residence for a child's birthday party.  Children were allowed to access the fire truck for entertainment and educational purposes.  A child fell down the stairs of the fire truck, striking her head on the asphalt.  The hearing arbitrator determined that this did not constitute an "accident".

In Amos v. Insurance Corp. of British Columbia (1995), the Supreme Court of Canada established two elements a claimant must be satisfy for an incident involving a motor vehicle to be considered to be an “accident” within the meaning of automobile insurance:

  1. It must be proven that the incident resulted from the ordinary and well-known activities to which motor vehicles are put (the “purpose test”); and
  2. It must be proven that there is a direct causal relationship between the insured person’s impairments and the use or operation of the vehicle in question (the “chain of causation test” or, simply, the “causation test.”)

The Ontario Court of Appeal has since modified the causation test for statutory accident benefits claims in Ontario, to take into account the requirement of "direct" causation of the impairment. However, the purpose test set out in Amos is still the first hurdle a claimant must satisfy to receive coverage.

The main issue in Carr was whether the child's use of the fire truck was “an ordinary and well-known activity to which motor vehicles are put”.  Delegate Feldman emphasized that the “use” to which a vehicle is being put at the time of an accident “must simply be a well-known, ordinary use for that particular vehicle”. Delegate Feldman also referenced the recent ONCA decision of Economical Mutual Insurance Company v. Caughy in support of the point that a vehicle need not be active/moving to be considered “operational”. The ONCA decided in that case that “parking a vehicle is an ordinary and well-known activity to which vehicles are put.”

Ultimately, Delegate Feldman found the child's activity on the fire truck was an ordinary and well-known use of that particular vehicle.  Therefore, an “accident” had occurred. 

Delegate Feldman distinguished between cases where a vehicle was in a museum, "disabled", or being used for some non-vehicle purpose (e.g. propping up a shed.).  In this case, the vehicle was a functioning fire truck that was temporarily parked.

This decision reinforces the importance of considering the well-known and ordinary use for the particular vehicle in question at the time of the incident.

See Carr (Thompson) v. TD


Dan's practice areas of interest include accident benefit and bodily injury litigation, loss transfer and priority dispute arbitrations and subrogation litigation.

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Accident Benefits, Arbitrations, Coverage, Legislation / Regulation  
  

 

 
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