Tag: section 86 BC Motor VEhicle Act

Vehicle Owner Found Liable For Crash After Household Member Took Vehicle Without Permission

Reasons for judgment were published last week with an extensive discussion of the principles of registered owner vicarious liability for BC collisions.

In the recent case (Bowe v. Bowe) the Plaintiff was injured as a passenger involved in a collision.  At the time of the crash the Plaintiff took his stepfathers car keys without permission.  They lived in the same household.  The Plaintiff contacted his cousin, who lived in a separate household, and collectively they took the vehicle.  In the course of the evening  the two boys drove around for several hours before the Accident.  Both took turns driving but at the time of the crash the cousin was behind the wheel.

The Plaintiff suffered serious injuries including a moderate brain injury.  A jury found the driver negligent and the plaintiff contributorily negligent.  A question arose as to whether the registered owner bears any liability in these circumstances.

Section 86 of BC’s Motor Vehicle Act establishes vicarious liability for vehicle owners when their vehicle is being driven by a household member or by anyone who acquired the vehicle with the owners consent.  The latter test was not applicable on these facts.  The court was asked whether the household member rule was triggered in these circumstances.  The applicable provision of the MVA reads as follows:

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Joint TortFeasor Payments Fully Deductible From Lessor's Vicarious Liability Obligations

BC’s Motor Vehicle Act and Insurance (Vehicle) Act limit the vicarious liability of vehicle lessor’s to $1 million.  Reasons for judgement were released this week by the BC Court of Appeal clarifying this obligation when a personal injury claim is worth over $1 million and other responsible tort feasors have paid the first $1 million in damages.  In short, the BC Court of Appeal held that once payments from other tortfeasor’s are made up to $1 million lessor liability is fully extinguished.
In this week’s case (Stroszyn v. Mistui Sumitomo Insurance Company Limited) the Plaintiff was involved in a serious motor vehicle collision and settled his injury claim for $1.6 million.  ICBC, who insured the responsible driver, paid the first $1 million being the full extent of the Third Party insurance available.  The Plaintiff sought to collect the balance from the lessor, Honda Finance Inc., who was the registered owner of the Defendant’s vehicle and vicariously liable for the tort.
The BC Court of Appeal held that ICBC’s payment fully satisfied any exposure Honda had.  In reaching this conclusion and clarifying the protections given to vehicel lessor’s in BC the Court provided the following reasons:

[24]         I see no basis in law for considering only a portion of the ICBC payment to have been made on behalf of Honda. In my view, each of the insureds in this case can regard the whole of the payment made by ICBC to have been made on his, her or its behalf and to have reduced its liability to the petitioner to the full extent of the payment. In the absence of a statutory provision limiting the lessor’s liability, all three would remain jointly and severally liable for the balance of the petitioner’s damages. However, the I(V)A having limited the lessor’s liability to $1 million, it is my view that the payment of $1 million to the petitioner on behalf of all insureds, including the lessor, completely discharges the lessor’s liability and leaves the other defendants jointly and severally liable for the balance of the damages.

[25]         This must certainly be the case where the liability of Ms. Chen and Honda is entirely vicarious. Vicarious liability is discharged to the extent of any payment made in satisfaction of a plaintiff’s claim for damages. This is not a case where liability can be apportioned by degrees of blameworthiness, or severed.

Vehicle Lessor Liability Limit Over and Above That of Motorist

UPDATE – November 7, 2014 – the below decision was overturned in reasons released this week by the BC Court of Appeal
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Important reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, addressing the limit of exposure for vehicle lessor’s when their vehicles are involved in an at-fault collision.
Provisions of the BC Motor Vehicle Act and Insurance (Vehicle) Act expose lessor’s to $1,000,000 of liability when their vehicles are involved in a collision.  The BC Supreme Court was asked to interpret these provisions in the case of a $1.6 million dollar claim.
In this week’s case (Stroszyn v. Mitsui Sumitomo Insurance Company Limited) the Plaintiff sued an at fault motorist and the vehicle lessor for damages following a collision.  The quantum was agreed to at $1.6 million dollars.  The ICBC insured defendant paid out the policy limits of $1 million.    The vehicle lessor argued that they did not need to pay the balance as they were shielded by section 82.1 of the Insurance (Vehicle) Act from any payment after a Plaintiff collects $1 million.  Mr. Justice Bowden disagreed finding a lessor’s exposure, while capped at $1 million, is over and above damages collected from other liable parties. In reaching this conclusion the Court provided the following reasons:
[34]         As a lessor, under s. 86(1.2), Honda Canada is vicariously liable as a joint tortfeasor. Without the limitation in s. 82.1, it would be liable, together with the lessee, for all or part of the damages of $1,600,000. However, section s. 82.1 places a $1,000,000 limit on that liability such that Honda Canada’s portion cannot be greater than $1,000,000.
[35]         In my view, the payment of $1,000,000 on behalf of the lessee does not reduce the liability of Honda Canada to zero. It is simply a payment by one joint tortfeasor towards the total liability of the jointly liable parties. By virtue of s. 86(1.2) of the MVA, both the driver, Mr. Chen, and Honda Canada are jointly liable for the damages of $1,600,000. Pursuant to s. 82.1, Honda Canada’s portion of that liability cannot exceed $1,000,000. Of the total liability, $1,000,000 has been discharged by ICBC on behalf of the lessee, but Honda Canada remains liable as a joint tortfeasor, for $600,000.
[36]         This result is consistent with the plain meaning of s. 82.1 of the I(V)A which limits the liability of Honda Canada to $1,000,000. Its portion of the joint liability will not exceed $1,000,000. In my view, the combined effect of s. 86(1.2) of the MVA and s. 82.1 of the I(V)A is to expose a lessor, like Honda Canada, to liability as a jointfeasor, of $1,000,000, but no more. Thus, in this case, if the driver/lessee had no insurance coverage, the lessor would be liable for the amount of $1,000,000. On the other hand, if the insurance coverage of the driver/lessee resulted in a payment of $1,600,000, then no amount would be payable by the lessor, Honda Canada.

Bullock Orders and Judicial Discretion


As previoulsy discussed, when a Plaintiff sues 2 parties and succeeds only against one the Court had a discretion under Rule 14-1(18) to order that the unsuccessful defendant pay the successful defendants costs.  Reasons for judgement were released last week by the BC Supreme Court, Vancouver Registry, demonstrating the flexibility of this discretion in action.
In last week’s case (Bakker v. Nahanee) the Plaintiff was injured when struck by a stolen vehicle being driven by the Defendant.  The Plaintiff sued for damages and, as is customary in BC, also sued the Registered owner of the vehicle alleging vicarious liability pursuant to section 86 of BC’s Motor Vehicle Act. As the lawsuit progressed it became clear that the at fault vehicle was indeed stolen making the vicarious liability claims untenable.
Ultimately the action was dismissed against the owner and a settlement was reached with respect to the claim against the driver.  The Plaintiff applied for an order that the Driver pay the costs of the successful owner.  Madam Justice Fitzpatrick agreed such a result was justified but only until the examination for discovery phase where it was obvious that the vicarious liability claims would not succeed.  The Court provided the following reasons:

[40] Supreme Court Civil Rule 14-1 (18) provides that the Court may exercise its discretion in ordering that the costs of one defendant be paid by another defendant:

If the costs of one defendant against a plaintiff ought to be paid by another defendant, the court may order payment to be made by one defendant to the other directly, or may order the plaintiff to pay the costs of the successful defendant and allow the plaintiff to include those costs as a disbursement in the costs payable to the plaintiff by the unsuccessful defendant…

[52] It is not a novel concept that when preparing pleadings, all parties who are potentially liable should be included where a valid cause of action can be reasonably advanced. This applies equally in the arena of motor vehicle litigation. In this respect, Mr. Bakker also relied on the evidence of Mr. David Kolb, a Vancouver lawyer who practices in this area. He states that an owner of the vehicle in question is always named as a defendant arising from the statutory vicarious liability under the Motor Vehicle Act. He goes on to state that even if the car was purportedly stolen, it is wise to err on the side of caution and name all parties until further investigations are done to ensure that all facts are known before the owner is released from the litigation. He cites as an example, that while the driver/thief and the owner may have different names, further investigations may in fact reveal that they were related and resided together, in which case the owner would be liable even if a stolen vehicle is involved. There may also be issues of fraud or improper motive on the part of the owner who reported the vehicle as stolen. Until such facts as may establish liability are ruled out, it is a prudent practice to name the owner.

[53] In these circumstances, as a general proposition, I am of the view that Mr. Bakker was reasonable in naming Ms. Ang and GMAC as defendants to this action…

[77] In my view, and exercising my discretion, the granting of a Bullock order is appropriate in the circumstances but the order should be limited, similar to that which was ordered in Cominco at 212. Accordingly, Mr. Bakker is entitled to a Bullock order but only in respect of the costs incurred up to and including the examination for discovery of Ms. Ang on September 20, 2007. By that time, Mr. Bakker’s counsel had elicited sufficient evidence from Ms. Ang to be satisfied that she and GMAC had no vicarious liability and that there were no mechanical issues relating to the vehicle. Beyond September 20, 2007, I am unable to say that it would be just or fair to fix Mr. Nahanee with the costs of Ms. Ang and GMAC.

More on Implied Consent of Registered Vehicle Owners: "Reasonable Inferences"

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:







[15] The following agreed facts about the accident of May 12, 2005, could support a finding of consent:

1) The truck which caused the plaintiff to lose control of her vehicle was owned by U-Haul;

2) U-Haul rents vehicles to customers in British Columbia;

3) U-Haul consents to drivers, other than the person with whom it contracted, to drive the vehicle if they are at least 18 years of age and have a driver’s licence;

4) Approximately 135 U-Haul vehicles were rented in British Columbia on May 12, 2005;

5) There were 114 vehicles owned by U-Haul Canada that were previously stolen and unrecovered on May 12, 2005, of which 15 had been stolen in British Columbia; and

6) The driver of the U-Haul that caused the accident was probably a man in his 50s.

[16] What I derive from the above agreed facts is that:

1) It is probable that the U-Haul vehicle was not stolen. That suggests it was driven, either by the person who initially rented it, or by someone who that person agreed could drive it, and who was at least 18 years of age. U-Haul accepts that if either is true there is consent, assuming the driver had a driver’s licence;

2) I take notice that a driver in British Columbia must have a driver’s licence and therefore I conclude it is probable this driver had one.

[17] There are other facts which may be inconsistent with consent. They are the following:

1) The driver was clearly lost;

2) The driver may have been uncertain of his ultimate destination;

3) The driver did not stop at the time of the accident.

[18] Those facts may be inconsistent with consent because:

1) It would be expected that a person who rents a U-Haul vehicle will have done so for a particular purpose and will have known his destination and the route he intended to follow;

2) A driver who leaves the scene of an accident may do so because he knew he was driving a stolen vehicle.

[19] However, there are numerous other possible reasons for failing to remain at an accident scene. One could be that the driver did not know he had caused an accident. There was no contact between the vehicles involved in the accident on May 12, 2005. Another could be that the driver knew he had caused an accident and did not wish to face the consequences. There may be a multitude of other reasons peculiar to this driver which caused him to leave the scene of the accident. In my view, the fact the driver left the scene of the accident does not assist in determining the issue of consent.

[20] When considering the circumstances of the accident of May 12, 2005, there is obviously no certainty when attempting to reach a conclusion that the U-Haul vehicle was driven by a person who had consent. However, the law does not require certainty. It does require that I draw a reasonable inference and do not rely on conjecture. The Court of Appeal in Lee v. Jacobson, [1994] B.C.J. No. 2459, has described Caswell v. Powell Duffryn Associated Colleries Ltd., [1940] A.C. 152 (H.L.) [Caswell], as the leading case making that distinction. In Caswell, at 169-70, Lord Wright observed:

My Lords, the precise manner in which the accident occurred cannot be ascertained as the unfortunate young man was alone when he was killed. The Court therefore is left to inference or circumstantial evidence. Inference must be carefully distinguished from conjecture or speculation. There can be no inference unless there are objective facts from which to infer the other facts which it is sought to establish. In some cases the other facts can be inferred with as much practical certainty as if they had been actually observed. In other cases the inference does not go beyond reasonable probability. But if there are no positive proved facts from which the inference can be made, the method of inference fails and what is left is mere speculation or conjecture.

[21] I conclude I can safely draw an inference that it is more likely than not that the driver had consent. I therefore answer question 2 in the affirmative.

[22] ICBC is entitled to its costs against U-Haul, if requested.








More on Registered Owner Liability and the Implied Consent Test


As previously discussedsection 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.





A Caution to BC Vehicle Owners – Take Care in Who You Lend Your Vehicle To


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.

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ERIK
MAGRAKEN

Personal Injury Lawyer

When not writing the BC Injury Law Blog, Erik is the managing partner at MacIsaac & Company, based in Victoria, B.C. He is also involved with combative sports regulatory issues and authors the Combat Sports Law Blog.

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