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Economical Mutual Insurance Co. v. Caughy, decided March 24, 2016

Active use of a vehicle is not a strict requirement for meeting the definition of “accident.”

Ontario Superior Court of Justice (Divisional Court)

This case arises out of an accident which occurred at a trailer park. Mr. Caughy, was playing a game of tag with his children when he tripped and fell over a parked motorcycle. He fell head first into a trailer, sustaining significant spinal cord injuries. He sought first party accident benefits from his insurer, but was denied on the basis that the events that took place did not meet the definition of “accident” found in the Ontario Statutory Accident Benefits Schedule (SABS).

Mr. Caughy brought an application to the Superior Court of Justice. The Judge disagreed with Economical and held that the incident “constituted an ordinary or well-known use of the vehicle,” therefore: (a) satisfying the definition under section 3 of the Schedule and (b) the two-part test for the definition of “accident” as described by the Supreme Court of Canada in Amos v. Insurance Corp. of British Columbia [1995] 3 S.C.R. 405. The Court of Appeal held that the correct analysis was to determine whether the incident “resulted from the ordinary and well-known activities” of automobiles. The Court held that “while the active use of an automobile (e.g. driving) would qualify under this test, there is no requirement that the vehicle be in active use.” The Court then stated that only where the vehicle is being used in a “truly aberrant way, should the injured person be disqualified from no-fault benefits. A vehicle is designed to be parked…I would conclude, therefore, that parking a vehicle is an ordinary and well-known activity to which vehicles are put.” By tripping over the temporarily parked vehicle, the Court held that the claimant was entitled to a myriad of benefits from his own automobile insurer.

Submitted by: David A. Bertschi, a founding partner at Bertschi Orth Solicitors & Barristers LLP, a Canadian Insurance and Commercial Litigation Boutique in Ottawa, Ontario, Canada.

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