In my continued efforts to publicly summarize ICBC UMP Arbitration Decisions, reasons for judgement recently have been provided to me dealing with the restriction on ICBC UMP Coverage in circumstances where a vehicle occupant is injured through the negligence of a motorist who did not have the vehicle owner’s consent to operate.

In the unreported 2003 UMP Decision (D v. ICBC) the Claimant was injured in a 1998 collision.  He was the occupant of a vehicle driven by MV.   MV did not have the registered owner’s consent to operate the vehicle.  MV was given permission to drive by J who was the registered owner’s son.  J initially obtained the vehicle with the owner’s consent.  J did not have the owner’s permission to allow others to operate her vehicle.

The claims arising from the crash exceeded the damages available under section 20 of the Insurance (Vehicle) Act.  The Claimant applied to have his excess damages paid under his own Underinsured Motorist Protection coverage with ICBC.   ICBC argued that UMP coverage was forfeited because the Claimant was a passenger in a vehicle that he “knew or ought to have known was being operated without the consent of the owner” contrary to section 148.1(3)(b) of the Insurance (Vehicle) Regulation.

Arbitrator Yule agreed that given the facts of the case the Claimant should have known that consent was absent.  In finding the Claimant was not entitled to coverage Arbitrator Yule provided the following reasons:

28….Whether (the owner) consented, however, is a different question from the one raised in this case, namely whether a passenger such as Mr. D knew or ought to have known that (the owner) would not consent to the use of her vehicle in these circumstances.  There may well be circumstances in which an original borrower, who is aware of restrictions on the use of the borrowed vehicle put in place by the owner, allows another to drive without ever communicating those restrictions.  If there were nothing else about the surrounding circumstances to cause a driver or passenger to question the owner’s consent to the driver’s operation of the car, the driver and passenger would be entitled to full insurance protection.  A similar concept of reasonable belief by a driver i the consent of a vehicle owner applies in the extension of third party liability coverage under a driver’s certificate (Regulation s. 49(1)(c)) and under an owner’s certificate (Regulation, s. 65(1)(f))….The question is whether there is sufficient evidence from the totality of the circumstances such that, if he had considered the matter, a reasonable person in Mr. D’s circumstances ought to have known that (the owner) would not consent to the use of her vehicle int he circumstances prevailing the evening…

32…Where the vehicle is not stolen, and the original borrower remains in possession of and an occupant in the vehicle, and where constraints regarding use are known to the original borrower and not disclosed to others in the vehicle, the burden of establishing facts that a passenger ought to have known the owner would not consent should be onerous, even before taking into account that s. 148.1(3)(b) is an exclusion from coverage.

33.  In my view the Respondent has met the burden in this case…

The Reasons go on to highlight the specific facts indicating why a lack of consent should have been known in the circumstances.

This decision is not publicly available but, as always, I’m happy to provide a copy to anyone who contacts me and requests one.  Also, if anyone has an UMP decision from prior to 2007 and you’d like to have it added to this database please don’t hesitate to contact me.

Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, dealing with an interesting issue - can a Court infer consent to operate when a commercial vehicle is involved in a ‘hit and run’ collision?

In last week’s case (Perret v. John Doe) the Plaintiff was injured in a 2005 collision.  She was run off the road by a U-Haul truck which was driving the wrong way on the highway.  The driver of the U-Haul did not remain at the scene of the accident.  The Plaintiff sued U-Haul arguing they are vicariously liable for the careless driver’s deeds under s. 86 of the Motor Vehicle Act.  She also sued ICBC under the unidentified motorist provisions of the Insurance (Vehicle) Act.

ICBC brought an application arguing U-Haul is at fault and that they are liable for the crash because anyone driving the vehicle likely had their consent to do so.  U-Haul opposed arguing ICBC should pay for the Plaintiff’s damages as this was an unidentified motorist claim and consent could not be proven.

The Court was asked to determine “whether ICBC or…U-Haul Co. is the proper Defendant” as a special case under Rule 9-3.  Ultimately the Court held that U-Haul was the proper defendant finding that it was reasonable to infer, on a balance of probabilities, that the driver had the company’s consent to drive.  In reaching this conclusion the Court made the following findings:

As previously discussed, section 86 of the BC Motor Vehicle Act makes owners or lessees of vehicles responsible for any damage or loss caused by the operation of their vehicle by an individual to whom consent was given.  In other words, if you let someone drive your vehicle and they cause a collision you can be sued to pay the damages.

Usually owners admit they allowed the driver to operate the vehicle.  In these cases there is ‘express consent‘.  Where there is no express agreement the law looks into the circumstances to decide if there was ‘implied consent‘.   Reasons for judgement were released this week by the BC Supreme Court, Victoria Registry, dealing with this area of law.

In this week’s case (Green v. Pelley) two plaintiffs sustained serious injuries when their vehicle was struck by a vehicle (owned by the Defendant McIvor) and driven by the Defendant Pelley.

The Plaintiff’s sued for damages.   There was no issue that Pelley did not have express consent to drive McIvor’s vehicle.  The Plaintiff’s alleged that there was implied consent.  Mr. Justice Saunders disagreed and dismissed the claim against the Defendant McIvor.  In doing so the Court summarized the legal principles with respect to ‘implied consent‘ as follows:

[39] The test for a finding of implied consent under s. 86, in situations where consent has been given to one person but the vehicle ends up being driven by a third party, is as set out in Hartley v. Saunders (1962), 33 D.L.R. (2d) 638 (B.C.S.C.), and in Godsman v. Peck (1997), 29 B.C.L.R. (3d) 37 (C.A.). The evidence must establish that the vehicle owner had both an expectation and willingness that a third party would drive the vehicle.  Both an expectation and willingness must be shown.  One without the other will not suffice: L’Heureux v. Eustache, 2003 BCSC 347 at para. 9.

[40] The requirement that an owner have an actual expectation of a third party driving the vehicle is relaxed, where it is clear from the circumstances that consent would have been given, if sought, as a matter of course in the particular circumstances confronting the person who is in possession by consent: dissenting judgment of Porter J.A. in Palsky v. Humphrey (1963), [1964] 41 D.L.R. (2d) 156 (Alta. S.C. (A.D.)), as approved of and adopted by the Supreme Court of Canada on appeal, [1964] S.C.R. 580 at 662…

[53] The plaintiffs urge me to take a broad view of the concept of consent in light of the legislative intent behind s. 86, which is said to be that of maximizing the availability of compensation for injured parties.  Indeed, Macdonell J. stated in the Bareham decision, at para. 27, that the only public policy reasons to be considered in interpreting s. 86:

. . . are those in favour of protecting innocent third parties seeking compensation for injuries suffered at the hands of negligent automobile drivers and, vicariously, owners.  . . .

Bareham, as I have noted, is a case in which consent was found.  In Bareham, the public policy argument addresses the subject of whether the consent had been vitiated by the driver’s illegal use of the vehicle.

[54] The same public policy considerations were cited by the B.C. Court of Appeal in Morrison (Committee of) v. Cormier Vegetation Control Ltd. (1996), [1997] 28 B.C.L.R. (3d) 280 (C.A.), at para. 24, as justifying the legislation’s departure from the common law’s strict approach to vicarious liability.  These same considerations were also cited in Barreiro v. Arana, 2003 BCCA 58, as justifying the statute’s modification of the law of agency.

[55] Godsman, in which the Court of Appeal approved of and restated the “willingness and expectation” test, was decided after Morrison and Bareham.  I do not read Barreiro as having modified the Godsman test in any way.

[56] I find that there is no evidence of Mr. McIvor having consented by implication to Pelley’s operation of the vehicle.  Therefore, as I understand the issue before me, the claim of the plaintiffs against Mr. McIvor based on vicarious liability is to be dismissed.

Reasons for judgement were published this week by the BC Court of Appeal revealing a valuable lesson to registered owners of vehicles.  Owners must take care in choosing who they lend their vehicle to as they can be found personally liable if such a person carelessly injures others while driving or operating the vehicle.

In today’s case (Robert v. Forster) Mr. Forster (the owner of a vehicle) allowed his daughter to use it.  He had rules restricting the scope of this permission, and these were that she “was not to drink and drive” and that “no one other than (the daughter) was to drive the vehicle“.

On June 2004 Mr. Forster’s daughter took the Jeep out.  She has been drinking at a bar.  After leaving the bar the daughter followed the first rule and did not drink and drive, however she broke her father’s second rule and let a friend drive the vehicle.  As the friend was driving the daughter “wrenched the steering wheel to the right” and caused the vehicle to flip into a ditch resulting in injuries to the occupants.

Various lawsuits were brought.  At trial the daughter, despite being a passenger, was found to be “driving” the vehicle.  She was found to be careless in grabbing the steering wheel with a finding that “t]he only conclusion I can come to on the evidence adduced at trial is that (the daughter’s) intoxication led her to believe that a hazard existed where there was none, or to think that it would be humorous to give the Jeep a shake by grabbing the steering wheel”  The Court went on to find that not only was she liable for the occupants injuries but so was the father as a result of s. 86 of the BC Motor Vehicle Act which holds as follows:

In an action to recover loss or damage sustained by a person by reason of a motor vehicle on a highway, every person driving or operating the motor vehicle who is living with and as a member of the family of the owner of the motor vehicle, and every person driving or operating the motor vehicle who acquired possession of it with the consent, express or implied, of the owner of the motor vehicle, is deemed to be the agent or servant of that owner and employed as such, and is deemed to be driving and operating the motor vehicle in the course of his or her employment.

The father appealed arguing he should not be held liable because the daughter was a passenger at the time and therefore could not have been “driving” the vehicle.

The BC Court of Appeal disagreed and dismissed the appeal.  In doing so the BC Court of Appeal made it clear that s. 86 of the BC Motor Vehicle Act is to be given a broad interpretation because it is intended to “expand the availability of compensation to injured plaintiffs).”  Specifically the BC High Court held as follows:

[21] This Court considered the purposes of s. 86 in Yeung (Guardian ad litem of) v. Au, 2006 BCCA 217, 269 D.L.R. (4th) 727, affirmed 2007 SCC 45. After reviewing the history and context of the section, Madam Justice Newbury commented as follows:

[38] …  the purposes of s. 86 are, I would suggest … to expand the availability of compensation to injured plaintiffs beyond drivers who may be under-insured or judgment-proof, and to encourage employers and other owners to take care in entrusting their vehicles to others.

The Court concluded in that case that a proper interpretation of s. 86 created vicarious liability on lessors of motor vehicles whose drivers are negligent in their operation if the drivers are in possession of the vehicle with the consent of the lessors.

[22] In my opinion, the conclusion that Ms. Forster was driving the Jeep is in accord with the grammatical and ordinary meaning of the language of s. 86 and the object and intention of the Legislature in enacting it. The decision in R. v. Bélanger establishes that a person sitting in the passenger seat of a vehicle can be regarded to be driving the vehicle if he or she controls the direction of the vehicle by turning its steering wheel. It is consistent with the first purpose of s. 86 articulated in Yeung v. Au to conclude that the Legislature intended an owner of a vehicle to be vicariously liable if a person, in possession of the vehicle with the consent of the owner, commits a deliberate, but negligent, act affecting the direction of the vehicle that causes injuries to another person.

[23] I therefore agree with the conclusion of the trial judge that Ms. Forster was driving the Jeep for the purpose of s. 86.

• Implied Consent

Another interesting point of this judgement was the Court’s discussion of whether the Father consented to the daughter’s friend driving the vehicle.   You will recall that one of the clear rules was that only the daughter was allowed to drive, not her friends.  At trial Mr. Justice Rogers held that the father nonetheless consented to the friend operating the vehicle and provided the following reasons:

[32] Barreiro makes it clear that the policy that drove the result in Morrison extends to situations where the owner gives the keys to its agent and the agent passes the keys on to a third party. Barreiro stands for the proposition that so long as the transfer of car keys from owner to second party is done by an exercise of free will, and the second party gives the keys to a third party by free will, the owner will be deemed to have consented to the third party’s possession of the car.  That will be the result even though the owner and the second party had an understanding that the third party was not to ever get possession of those keys.

[33] In my view, except for the fact that (the owner) obtained no financial benefit from (the driver’s) possession of the Jeep, the present case is not distinguishable from Barreiro.  (the owner) freely gave the Jeep’s keys to (his daughter).  She freely gave the keys to (the driver).  (the owner) must, therefore, be taken to have expressly consented to (the driver’s) possession of the Jeep on the night in issue.

[34] For the same reason, (the owner) must be taken to have expressly consented to (his daughter’s) possession of the Jeep that night, and that is so notwithstanding the fact that she was intoxicated and that her being intoxicated broke the other of (the owner’s rules.

The BC Court of Appeal was asked to overturn this ruling but they refused to do so.  The BC High Court held that, since the driver of the vehicle was not careless (and therefore not responsible for any of the passengers injuries) the issue of whether or not there was consent “is moot and need not be decided on this appeal“

You can click here to read my 2008 article discussing the trial judgement.

As I’ve previously written, section 86 of the Motor Vehicle Act makes owners or lessees of vehicles responsible for any damage or loss caused by the operation of their vehicle by an individual to whom consent was given.

Reasons for judgement were released today by the BC Supreme Court interpreting the meaning of ‘consent’.  In today’s case (Morris v. Morris) the Plaintiff was injured when riding as a passenger in a vehicle driven by his brother.  The vehicle was rented from Enterprise Rent-A-Car.   The Plaintiff sued the driver and the rental car company.

The vehicle, however, was not rented to the Plaintiff’s brother, but rather his mother.  The rental contact stated “No Other Driver Permitted“.   Despite this restriction, after renting the vehicle the Plaintiff’s mother let the Plaintiff’s brother drive the vehicle.

The issue at trial was whether, in these circumstances, Enterprise Rent-A-Car could be held liable as registered owner.  A recent case (McEvoy v. McEachnie) held that a registered owner can be held liable in similar circumstances (click here to read my summary of the McEvoy case).  In today’s case, however, Mr. Justice Cole refused to follow the precedent set in McEvoy finding that the judge in that case “failed to consider binding authority“.  In finding the rental company not liable as having not consented to the driver operating the vehicle Mr. Justice Cole summarized the law and distinguished the McEvoy case as follows:

[31] The most recent case from British Columbia dealing with the interpretation of implied consent under s. 86 of the Act, and the plaintiff argues I am bound by that decision, isMcEvoy v. McEachnie, 2008 BCSC 1496 [McEvoy]. In that case, a father gave his daughter consent to drive his vehicle but made it expressly clear that no other drivers were permitted. The daughter subsequently allowed her friend to drive the vehicle, because she was intoxicated, and an accident ensued. In finding the father liable, the Court appliedBarreiro, a case where a rental car employee consented to a vehicle being rented by an underage driver, contrary to company procedure, and interpreted it, at para. 32, to stand for the proposition that:

[32] … so long as the transfer of car keys from owner to second party is done by an exercise of free will, and the second party gives the keys to a third party by free will, the owner will be deemed to have consented to the third party’s possession of the car. That will be the result even though the owner and the second party had an understanding that the third party was not to ever get possession of those keys.

[32]         The Court in McEvoy concluded that, except for the fact that the father did not obtain a financial benefit from the friend’s possession of the vehicle, the case was not distinguishable from Barreiro. In the present case, other than the fact that the agreement forbidding other drivers was written, rather than oral, the facts cannot be distinguished  from McEvoy. Enterprise freely gave the keys to Ms. Kauth, she freely gave the keys to Mr. Morris, despite expressly agreeing that there would be no other drivers. Enterprise would, on the logic of McEvoy, be taken to have consented to Mr. Morris’ possession of the vehicle and therefore, Enterprise would be vicariously liable pursuant to s. 86 of the Act for any liability that Mr. Morris may have for this accident.

[33]         On its face, it would appear that this decision would be binding on this Court, because the facts cannot be differentiated merely because the agreement in McEvoy was oral and not written. In Hansard, Spruce Mills Ltd., Re (1954), 4 D.L.R. 590 at 592, 13 W.W.R. (N.S.) 285 (B.C.S.C.) [Hansard], the Court held that a trial judge should follow the decisions of his brother judges of the same court unless subsequent decisions have affected the validity of the impugned judgment; it is demonstrated that some binding authority in case law or some relevant statute was not considered; or the judgment was unconsidered, where an immediate decision is given without the opportunity to fully consult authority. If none of these situations exist, barring a distinguishing feature between the facts, a court would be correct in following decisions of a court of the same level.

[34] On the basis of the test set out in Hansard, McEvoy in my view is not binding on this Court as it failed to consider binding authority. In Godsman, Smaldino, Prasad and Louisthe Court refused to find consent where it would not have been given in the circumstances. McEvoy overlooks these decisions and does not consider this test.

[35] The Court instead held the father liable because they interpreted Barreiro to mean that if keys are transferred by free will to the daughter, the father is deemed to consent to subsequent transfers of possession including his daughter’s friend’s possession. However, in Barreiro the company transferred possession to the rental car employee and gave the employee the authority to transfer possession to people wishing to rent the vehicle. Therefore the employee had authority to transfer the vehicle subject to following proper procedures, but in McEvoy the daughter lacked authority to transfer the vehicle.

[36] Furthermore, the Court in McEvoy relied upon Morrison to support the finding of consent. In Morrison, consent was given subject to conditions upon the authorized driver, namely that the company vehicle was not to be operated by an employee for personal use. These conditions were breached, but the Court held that the conditions did not vitiate the consent. In McEvoy, the Court interpreted “no other drivers” as a condition. However, in my view there is a distinction between no consent at all and consent subject to conditions. The Court should first find implied consent exists on all the circumstances and then apply Morrison to any conditions added to that implied consent: K.T. v. Tran, 2007 ABCA 13, 280 D.L.R. (4th) 142.

[37] Had the Court in McEvoy considered Godsman, Smaldino, Prasad and Louis, the result may have still been the same on the second ground for finding consent, stated by Mr. Justice Rogers, but not on the first. Based on Godsman, Smaldino, Prasad and Louis, consent can only be implied if it would have been granted as a matter of course in the circumstances. In McEvoy, the father’s purpose in telling the children to not let others drive his cars was not to limit his statutory liability as the car’s owner, but because he trusted his kids but not their friends and he wanted to keep his children and his cars safe. It could be argued that the father in McEvoy would have consented in the circumstances to the friend driving because his daughter was intoxicated and he would want the car and his daughter home safely. On the present facts, like in Prasad, it is hard to imagine that Enterprise would have given consent in the circumstances.

[38] The trend in our jurisprudence tends to be more restrictive than the broad policy approach that is taken in some United States jurisdictions and in some degrees by the Alberta courts. I am satisfied that the test for implied consent in British Columbia is whether the owner would have consented in the circumstances:  Godsman, Smaldino, Prasad and Louis. Based on the facts of the present case, there was no express consent given by Enterprise to Mr. Morris and in my view, it is clear that consent would not have been given in the circumstances. Enterprise did everything possible to limit its liability and if its liability is to be extended in any event, to prefer the protection of third parties, then that is the job of the Legislature to rewrite the wording of the statute.

[39] I therefore dismiss the action against the defendant Enterprise and they are entitled to their costs.

I understand that the McEvoy case is going to be heard by the BC Court of Appeal in the near future and the law of ‘consent’ with respect to registered owner liability should hopefully be more clear after they weigh in on this issue.