We had to distinguish based on disease – re: Gibbens
We also spoke about public policy a little bit last class
There is a difference between CVL and CML: the standard in CML is an objective standard (Sirois). In CVL, there has been a softening of the objective reasonable person standard (creeping subjectivity).
In QC, somewhat a more pro-insured position since they look at that particular insured
Both traditions care about the act and intention to cause damages
The answer is in the Axa case
Now let’s move into the public policy business.
In Goulet and Oldfield, the insured died during the commission of a criminal offence.
the beneficiary is innocent
if the insurer intended to exclude this, they should have put the clause in the policy
the clause can only apply to indictable offences
so unless deaths resulting from criminal offences is specifically exclude, we don’t deprive innocent beneficiary from indemnity
but in Oldfield, courts reflect on if the beneficiary is the estate of the insured
the insured would not get the proceeds
dual patrimony rule – this would be the continuation of the patrimony of the insured
Brissette Estate v Westbury Life[1992] 3 SCR 87 – CML
Life insurance – death by accident – public policy
Facts: A married couple bought a term life insurance policy which named the surviving spouse as the beneficiary. During the course of this policy, the husband murdered his wife. Husband brought action hoping to recover. Action failed. Now estate of wife bringing action.
Issue: whether the insurance company was absolved from paying anything under the policy in these circumstances.
Held: Yes – no payment.
Reasoning: (majority):
The contract cannot be construed to require payment to the victim's estate; that was never the parties' intention.
Moreover, the contract's wording was unambiguous: the money was to be paid to the survivor.
Public policy prevents the money from being paid in accordance with the explicit terms of the contract to a survivor who has acceded to this status by killing the other party. These terms cannot be rewritten under the guise of interpretation and resort to a constructive trust is an acknowledgement that this is so.
Irrespective of the ultimate payee of the insurance proceeds, denial of recovery is consistent with public policy because it prevents the insured from insuring against his or her own criminal act.
And even if denial of recovery was contrary to public policy in this case, it would be contrary to principles of equity to employ a constructive trust in this case
Ratio: When the original beneficiary is no longer eligible to the proceeds because of public policy, another person will not be entitled to the benefits unless expressly indicated in the policy (or by Statute)
Class Notes
in Broiler case, rules of interpretation were set down
In this case, there was a contract. Mary + Gerald. Couple took out a life insurance policy where both parties were designated as the insured. Beneficiary was the survivor.
Gerald killed Mary. Obviously Gerald can’t claim, but can the policy be interpreted such that the proceeds go to Mary’s estate? And can they make a constructive trust (CML concept: a way of dealing with property when there is no legal principle that enables one to deal with it)?
Court works through two other cases in order to figure it out:
Demeter
Husband was PH. Insured was wife. Husband was beneficiary. Wife not party to contract (no legal interest in policy). Husband kills wife. So, husband obviously can’t collect, and since wife has no interest, could not go to her (or consequently her daughter).
Cleaver
Husband = PH + insured. Wife = beneficiary, with statutory disposition which intervened and said that proceeds were payable to Husband’s estate if wife could not collect (problem with this is that the wife is a beneficiary of her Husband’s estate!). Wife murders Husband. Public policy rule could not take away a right the estate had by statute.
No such disposition in the case of Brissette nor a provision of payment to the estate of the victim
Strong dissent
Dhingra v Dhingra 2012 ONCA 261 - CML
Life insurance - Person who was found not criminally responsible on account of mental disorder was not prevented by public policy rule from receiving proceeds of insurance policy
Facts: Appeal by Dhingra from the dismissal of his application for payment of the proceeds of a $51,000 insurance policy on his deceased ex-wife, Kamlesh. Dhingra acquired a group Accidental Death Benefit Plan policy with Scotia Life Insurance Company (the insurer) in June 1998 as the insured pursuant to the insurance policy. Kamlesh was named as a "Spouse Insured" or co-insured. In June 2006, Kamlesh was found dead in her home, and Dhingra was charged with second degree murder. Following a trial, Dhingra was found not criminally responsible by reason of a mental disorder. Estate of deceased is now arguing that the proceeds should be paid to them as insurance proceeds should not be paid to Dhingra pursuant to the public policy rule that a person who wrongfully killed another was not allowed to enjoy profit resulting from the act of killing. Dhingra is arguing that he is the only one named beneficiary under the policy and the proceeds should be paid to him.
Issue: Whether a person who was found not criminally responsible on account of mental disorder was prevented by public policy rule from receiving proceeds of insurance policy.
Held:_No.__Reasoning'>Held: No.
Reasoning:
A person who was found not criminally responsible on account of mental disorder was not prevented by the public policy rule from receiving the proceeds of an insurance policy.
If a person found not criminally responsible on account of mental disorder was not morally responsible for his or her act, there was no rationale for applying the rule of public policy, which was founded in the theory that people should not profit from their crimes or, more broadly, by their own wrongs.
Ratio: A person found not criminally responsible on account of mental disorder is not barred from recovering life insurance proceeds from the policy of the person they killed.
Class Notes
wife and husband had mutual insurance
husband kills wife but found not guilty because of mental disorder
trying to get proceeds into mother’s estate
does the PP rule apply?
He was not criminally responsible, therefore not a criminal act. He was unable to form an intention for the criminal act. Therefore, he was able to get the proceeds of the outcome.
The public policy rule is about moral responsibility. Where there is no moral responsibility, does not apply.
Under civil law, under CCQ 2443, insurer might be able to deny recovery (attempt on the life of the insured).
However, don’t you run into the same issues when you say attempt on the life if the individual was not aware of what he was doing?
our next subject is the use of the motor vehicle
no fault vs. partial no-fault regimes vs. opening the door for the insurance market
divergence between QC, Manitoba, and other provinces
Facts: R was killed when a tree fell on the vehicle he was driving in the City of Westmount. R’s parents and three brothers filed an action in damages against the City on the basis of civil liability under the Civil Code of Québec. They alleged that, as the owner of the tree, the City had failed to properly maintain it. The City moved to dismiss the action under arts. 165(4) and 75.1 of the Code of Civil Procedure. It argued that the injury resulted from an accident caused by an automobile and, therefore, that any compensation for personal injury was governed by the Automobile Insurance Act (“Act”).
Issue: Whether driver’s injuries were “caused by an automobile, by the use thereof or by the load carried in or on an automobile”. Whether civil claim barred by virtue of public automobile insurance scheme’s application.
Held: Yes. Yes.
Reasoning:
The Automobile Insurance Act must be given a large and liberal interpretation to ensure that its purpose is attained.
Pram teaches that, in determining whether the Act applies, a court must not look for a traditional causal link between fault and damage as is routinely done in delictual or quasi delictual civil liability cases.
In any case, at a minimum, an accident arising out of the use of a vehicle as a means of transportation will fall within the definition of “accident” in the Act and will therefore be “caused by an automobile” within the meaning of the Act
Any civil action in connection with the damage caused by that accident will be barred and victims will have to file a claim with the Société de l’assurance automobile du Québec.
The vehicle’s role in the accident need not be an active one. The mere use or operation of the vehicle, as a vehicle, will be sufficient for the Act to apply.
The evidence on the record is that R was using the vehicle as a means of transportation when the accident occurred. This is enough to find that the damage arose as a result of an “accident” within the meaning of the Act and that the no fault benefits of the scheme are triggered. Therefore, the civil claim is barred and R’s parents and brothers must turn instead to the Société de l’assurance automobile du Québec for compensation.
Ratio: (1) The Automobile Insurance Act must be given a large and liberal interpretation. (2) An accident arising out of the use of a vehicle as a means of transportation will be categorized as an automobile accident as within the act. (3) Civil proceedings for automobile accidents are barred in Quebec.
Class Notes
How far does the concept of damage caused by the use of an automobile go?
Rossy family sued city of Westmount for negligence in failure to maintain the tree
City of Westmount attempted to throw out the case from the get go through art. 83.57 LAAQ (bars any civil proceeding for bodily injury caused by an automobile accident)
‘caused’ by an automobile is not a Tort meaning in this case (since it’s in Statute)
according to Lamed, this case keeps the parameters of an ‘automobile accident’ very wide in QC
Lumbermens Mutual Causalty Co v Herbison 2007 SCC 47 -CML
Automobile insurance – “directly or indirectly from the use or operation of a motor vehicle”
Facts: W, a member of a yearly deer-hunting party, was driving to his designated hunting stand before sunrise when he thought he saw a deer. He got out of his truck, removed his rifle, loaded it, and shot at a flash of white, hitting H, another member of the hunting party. H and his family sought recovery from W’s insurer under a standard motor vehicle liability insurance policy which, as required by s. 239(1) of the Ontario Insurance Act, provides coverage for loss or damage “arising from the ownership or directly or indirectly from the use or operation” of an automobile owned by the insured.
Issue: Whether victim’s injuries arising “directly or indirectly from the use or operation” of an automobile.
Held: No.
Reasoning:
The insurance in this case requires that the victim demonstrate that the liability imposed by law upon the insured is for loss or damage arising from the ownership or directly or indirectly from the use or operation of the automobile.
Test: The questions are: (1) whether the claim is in respect of a tort committed while using a motor vehicle as a motor vehicle and not for some other purpose, and secondly, (2) whether there is an unbroken chain of causation linking the injuries to the use and operation of the vehicle.
While the addition of “directly or indirectly” to s. 239(1) relaxed the causation requirement, it did not eliminate the requirement of an unbroken chain of causation.
An intervening act may not necessarily break the chain of causation if it arises “in the ordinary course of things” but merely “but for” causation is not sufficient.
In this case, W was using his vehicle for transportation, which is its ordinary use. However, in an act independent of the ownership, use or operation of his truck, W interrupted his motoring to start hunting thereby breaking the chain of causation. The injury cannot be said to have arisen “directly or indirectly from the use or operation” of the insured truck within the meaning of s. 239(1).
Ratio: An act independent from the ownership, use or operation of a motor vehicle will break the chain of causation for automobile insurance and the insurer will not be liable to indemnify.
Comments:
Consolidated-Bathurst: "the courts should be loath to support a construction which would either enable the insurer to pocket the premium without risk or the insured to achieve a recovery which could neither be sensibly sought nor anticipated at the time of the contract"
Amos itself rejected a simple but-for test: still must be a causal connection between the injury sustained and the ownership, maintenance or use of the automobile and which causal connection is more than incidental, fortuitous or but for.
Class Notes
Wolfe drove truck to a hunting stand. Stopped car. Got out. Thought he saw flash of light and he shot. Ended up hitting another member of the hunting party in the leg.
Herbison is trying to recover under Wolfe’s motor vehicle liability policy.
S. 239 Ontario insurance act: provides coverage for loss or damage “arising from the ownership or directly or indirectly from the use or operation” of an automobile owned by the insured.
Issue is the causal connection between the use of the truck and Wolfe’s liability
Substantial reference made to Amos
Also makes reference to No fault regime
Sets out test:
1) Purpose
2) nexus or connection between injuries sustained and the use of a vehicle
is there an unbroken chain of causation between the injuries caused by Wolfe and the use of a vehicle?
SCC ruled Yes. There is an interruption between using the car and the shooting that caused the injury. He may have been dependent on the car, the car may have been noisy, but the injury was a separate tortious act and not connected with the use of a vehicle.
Facts: The Vs were motoring along an interstate highway when their vehicle was struck by a large boulder dropped from an overpass by F and R, catastrophically injuring MV and causing CV and SV serious psychological harm. The Vs received statutory no-fault benefits from their Ontario insurer and, since F was inadequately insured, they sought to recover the civil damages F had caused from V’s insurer pursuant to the inadequately insured motorist coverage found in s. 3 of the Ontario Policy Change Form 44R. F’s vehicle had been used to transport the rocks to the scene of the crime and thereafter to escape.
Issue: Whether insured’s injuries “arising directly or indirectly from the use or operation of an automobile” — Whether tort that cause insured’s injuries intervening event severable from use and operation of wrongdoer’s motor vehicle.
Held: Yes from V’s perspective, no from F&R perspective. Yes.
Reasoning:
The claim did not arise from the ownership or directly or indirectly from the use or operation of a motor vehicle.
Although the use of F’s vehicle (e.g. transporting rocks) fell within the scope of the ordinary activities to which automobiles are put, the word “indirectly” is not sufficient to overcome the requirement for an unbroken chain of causation linking the conduct of the tortfeasor as a motorist to the injuries in respect of which the claim is made.
In this case, the relevant tort consisted of dropping the rocks from a highway overpass, not transporting rocks across the countryside. F was not at fault as a motorist.
The tort was an independent act which broke the chain of causation. It was an intervening event severable from the use and operation of F’s vehicle.
Insurance policies must be interpreted in a way that gives effect to the reasonable expectations of both insured and insurer.
Amos established that in the context of no fault benefits, the mutual expectation of the parties is that no fault benefits will be available when an accident occurs during the “ordinary and well known” use of their vehicles, provided that some nexus or causal relationship between the use of the vehicle and the injuries can be established.
However, this case does not involve no fault statutory accident benefits, and the Court of Appeal erred in transferring without modification the “relaxed” causation test in Amos to the different context of indemnification insurance,where it must be shown that the tortfeasor is liable as a motorist.
Ratio: (1) The words “indirectly” do not remove the requirement for an unbroken chain of causation. (2) The Amos test is established in the context of no-fault benefits and cannot be transferred to civil liability cases without modification.
Class Notes
Ontario family driving in NC, USA. Car struck by boulder by individuals throwing them. Son of family injured. Individuals receive prison sentences. Family goes after private insurance as well – had coverage for “underinsured motorist rider” (refers to party who does the damage, however). SO they have to involve vehicle of perpetrator in order to involve this clause of the policy.
Does the injury arise directly or indirectly from the use of operation from the motor vehicle (of the perpetrator)?
Court found that chain of causation was broken. Civil liability came from dropping the rocks, not transporting the rock. The insurer’s liability turned on the nature of the Tort, not on the size of the rocks. So just because perp needed the car to transport the rocks, it doesn’t change the fact that the chain of causation was broken at the time they ceased transporting.
