Court Of Appeal Takes Expansive Approach To Definition Of “Accident” In Caughy Decision

Lat Updated: November 18, 2016 | Nicholaus de Koning | Miller Thompson

The Ontario Court of Appeal’s decision in Caughy v. Economical Mutual Insurance Company 2016 ONCA 226 seems to have expanded the definition of “accident,” for the purposes of statutory accident benefits, to include a trip and fall incident.

Recall the definition of “accident” in the Statutory Acident Benefits Schedule- Effective September 1, 2010(“Schedule”) is “an incident in which the use or operation directly causes an impairment or directly causes damage to prescription eyeware, denture, hear aid, prosthesis or other medical or dental device.

The unfortunate Mr. Caughy suffered what turned out to be devastating spinal cord injuries as a result of what could have been a rather innocuous event: while playing tag with his children at a campground, he tripped and fell on a motorcycle parked near his trailer. Mr. Caughy had originally parked his trailer close to another camper, leaving a sort of walkway between the trailers. Unbeknownst to him, the motorcyclist had parked the motorcycle in the darkened walkway during the evening hours. Mr. Caughy (who had been drinking a “considerable” amount of alcohol) fell head first into the trailer, suffering serious spinal cord injury. One wonders if the resulting decisions illustrate the adage that hard cases make bad law.

At the lower court stage, the presiding judge, Justice Nightingale found this scenario constituted an “accident.” Justice Nightingale noted that the Supreme Court of Canada, in the 1995 decision Amos vs ICBC, under differently worded legislation, established a two-fold test:

  1. Did the accident result from ordinary and well known uses to which automobiles are put (the “Purpose Test”)
  2. and, was the relationship casual or merely fortuitous or incidental? (the “Causation Test”)

Justice Nightingale then noted that the Ontario legislation was amended in 1996 by eliminating the phrase “directly or indirectly” and limiting the definition to impairments caused “directly” by use or operation of a vehicle. In various Ontario Court of Appeal decisions (subsequent to Amos), such as Greenhalgh vs ING Halifax 2004 CanLII 21045 (ON CA), the test was refined such that the second branch, the Causation Test, requires consideration of whether, even if the “use or operation” of the vehicle was “a cause” of the injury, was there an intervening act which cannot be said to be “part of the ordinary course of things”. Another consideration is that of dominant feature.

Justice Nightingale reasoned that the “Purpose Test” was met because the parking of the motorcycle (albeit in a walkway intended for pedestrians) was an ordinary use to which vehicles are put. It appeared the motorcycle had been parked there temporarily. It had not been abandoned nor was there any evidence it was inoperable. Most vehicles are parked most of the time.

Justice Nightingale gave more attention to the Causation Test. He accepted that the “direct” causation requirement is more stringent than that under the old “direct or indirect” legislation. He observed the Court of Appeal’s reasoning in cases such as Greenhalgh that “it is not enough that an automobile was somehow involved in the incident giving rise to the injury” and that “it is not enough to show that the automobile was the mere location of an injury inflicted by a tortfeasor.” After articulating this, Justice Nightingale reasoned the Causation Test was met because the parking of the motorcycle was the dominant feature of the incident and it was not ancillary. The fact that Mr. Caughy had been drinking alcohol and running in a dark area were not “intervening events” sufficient to break the chain of causation.

On appeal, Economical restricted its argument to the Purpose Test. It did not challenge the finding that the Causation Test has been met. Economical’s main argument was that the Purpose Test requires that there be some active use. Economical argued that since the motorcycle was parked and its operator apparently not close by, it had been abandoned. An analogy to a tree trunk was drawn. The Court rejected this argument, stating first of all, there was no evidence the motorcycle was “abandoned” (as opposed to being parked for a few hours) and secondly, there is no active use component in the Purpose Test. Rather, the issue is whether the incident arose from the “ordinary and well-known activities” to which vehicles are put. Parking a vehicle is a well-known activity associated with a vehicle. The Court noted that “use” is an important part of the analysis under the Causation Test- but again, the appeal was not framed in relation to that.

Read in a superficial way, the Court of Appeal’s decision suggests that the Purpose Test is just a gate keeping device to rule out “aberrant” uses of a vehicle such as using a vehicle as a diving platform or to prop up a shed (as mentioned in Vytlingam vs Citadel, a Supreme Court decision referred to by the Court of Appeal). On that point, it is difficult to see anyone disagreeing with the Court’s observation that parking a vehicle is an ordinary activity in the sense that any vehicle must be parked at some point. But if the Purpose Test is just a simple screen to rule out “aberrant uses” then it doesn’t serve much purpose, as almost any incident involving a vehicle will pass the test other than very obvious aberrant uses (such as using a car as a diving platform, although some Arbitrators may beg to differ). Additionally, the argument (although unsuccessful in this case) that a vehicle is parked is evidence of “lack of use” and “lack of operation” has some strength.

The Court of Appeal may cause confusion for those trying to understand the boundary between the Purpose Test and the Causation Test. Moreover, whether one is considering the Purpose Test or the Causation Test, the Court of Appeal’s decision represents a departure from previous decisions, which do, in fact, at least imply an “active use” element in the overall analysis. Not least of these is the earlier decision of Justice Laskin of the Court of Appeal in Chisholm v. Liberty Mutual Group [2002] O.J. No. 3135. That case involved a motorist who was seriously injured in a drive by shooting. Justice Laskin agreed with the lower court judge that the direct cause of his injuries was gunfire, not use or operation of a vehicle.

In Chisholm, Plaintiff counsel argued that the relevant consideration was “but for,” since “but for” being in his car, Mr. Chisholm would not have been shot. But Justice Laskin noted that “but for” is merely an exclusionary device. If the “but for” test is not met, then the injury would have happened regardless and causation is not established. If the “but for” test is met, then the use of the vehicle is “a factual cause” of the injury. But legally, direct causation requires more than that. Justice Laskin used the analogy of a row of dominoes in relation to direct causation: “one thinks of something knocking over the first in a row of blocks, after which the rest falls down without the assistance of any other act.” Justice Laskin also approved a definition from Black’s Law Dictionary as follows: “the active, efficient cause that sets in motion a train of events which brings about a result without the intervention of any force started and working actively from a new and independent source.” Accordingly, Mr. Chisholm’s use of a vehicle was “a” factual cause of his injury, but it was not the “direct cause” from a legal standpoint. By analogy, the motorcycle over which Mr. Caughy tripped was “a” cause of his injury, but it is questionable whether it should be a “direct cause” to the requisite legal degree. If a vehicle is parked for several hours, such that it basically constitutes an obstacle to pedestrians, can it really be said to be an “active and efficient cause” that “sets in motion a train of events?”

Ultimately, one passage from Chisholm has particular resonance in the Caughy decision. “The 1996 Schedule reflects a government policy decision. The government decided to circumscribe the insurance industry’s liability to pay no-fault benefits by holding it responsible only for injuries directly caused by the use or operation of a car. Like almost any statutory standard, the direct causation requirement will, at the margins, produce hard cases, perhaps even sympathetic cases and seemingly arbitrary results.”


The blog sets out a variety of materials relating to the law to be used for educational and non-commercial purposes only; the author(s) of the blog do not intend the blog to be a source of legal advice. Please retain and seek the advice of a lawyer and use your own good judgement before choosing to act on any information included in the blog. If you choose to rely on the materials, you do so entirely at your own risk.


Canada not prepared to deal with financial impact of a major earthquake


  • Canada is not prepared to deal with the macroeconomic and fiscal consequences of a massive earthquake.
  • A large-enough earthquake would overwhelm the Canadian economy, leading to financial contagion that would delay rebuilding and result in additional long-term economic loss.
  • The government can play a role in mitigating these economic and fiscal costs.

OTTAWA, Nov. 22, 2016 /CNW/ – A massive earthquake off the coast of British Columbia has the potential to cause widespread failure among insurance companies and trigger a domino effect across the financial sector, according to a new Conference Board of Canadareport, Canada’s Earthquake Risk: Macroeconomic Impacts and Systemic Financial Risk.

“As the earthquake in New Zealand earlier this month reminds us, we cannot prevent massive earthquakes from happening. However, we can lessen the impact of a massive quake on the economy by putting in place additional backstop measures to protect the insurance industry and the financial sector more broadly,” said Pedro Antunes, Deputy Chief Economist. “At the industry’s current levels of capitalization, Canada is not prepared to deal with the macroeconomic and fiscal consequences of a large earthquake. It is important for Canadians, businesses and government leaders to understand that the current regulatory regime may not be able to protect our economy from a major disaster.”

In this analysis, the Conference Board tests the ability of the Canadian economy to deal with earthquake risk. It estimates the macroeconomic and financial impacts of a major earthquake off the coast of British Columbia and the 10-year period that follows. A massive earthquake, similar to the 2011 earthquake and tsunami in Japan, is considered to be a rare event. Natural Resources Canada estimates the probability of a significant earthquake in Western Canada over the next 50 years at 30 per cent, and between 5 per cent to 15 per cent in Eastern Canada.

The analysis indicates that the fiscal and macroeconomic impacts of such an earthquake would be devastating. Insured losses that exceed $42 billion would surpass the level at which the industry is currently capitalized. Such an earthquake would result in $127.5 billion in total economic losses and could result in approximately 15,000 deaths.

An earthquake of this size would inevitably cause insurance companies to fail. And the existing industry compensation mechanism created to protect policyholders would cause failures to snowball. This would trigger a chain of systemic financial contagion resulting in insolvencies across the industry and the broader financial service sector, while delaying the rebuild and recovery efforts by an estimated two years.

The Conference Board estimates that the earthquake and fallout from financial contagion reduces real gross domestic product (GDP) by a cumulative $100 billion and costs an estimated 437,000 person-years of employment—equivalent to the loss of 43,700 jobs over the 10-year period.

Real GDP losses peak at nearly $38 billion in the third year after the earthquake, and the rebuild effort would not contribute positively to growth until 6 years after the earthquake.

Stringent capital requirements for insurers, while contributing to making the Canadian insurance industry one of the soundest in the world, are not enough to address the very low-frequency, high-severity probable events.

In addition to the $42-billion cost to Canada’s property and casualty insurers, the rebuilding effort would take an enormous toll on all levels of government finances. Taxpayers would have to absorb the costs of losses to both public assets and infrastructure, as well as uninsured private losses. But the financial contagion is also very costly. Reduced revenues and increased government spending add $122 billion in net new public debt to government coffers—nearly double the $63 billion in government borrowing that would be necessary if Canada had a mechanism in place to avoid financial contagion following the earthquake.

While an earthquake this size is an extremely rare event, governments could establish an emergency backstop mechanism that prevents financial contagion and would mitigate economic and fiscal costs.

Sun Life Financial announces industry-leading underwriting and product changes

TORONTO, Nov. 21, 2016 /CNW/ – Sun Life Assurance Company of Canada (“Sun Life”) today announced significant individual insurance underwriting changes and enhanced life insurance products in Canada to make it easier and more convenient to access insurance.

The changes include:

  • Offering life insurance coverage of more than $3 million for people living with HIV, providing the most coverage for the broadest range of ages in the Canadian industry. Sun Life is rolling out HIV life coverage in other markets around the world. Sun Life has been a proud supporter of the Canadian Foundation for Aids Research (CANFAR) since 1996 and a sponsor of CANFAR’s Bloor Street Entertains since 2004.
  • Underwriting requirements such as medical exams, ECG, stress ECGs, oral fluid samples and urine HIV tests will no longer be routinely required for either critical illness or life insurance. Sun Life will now only need an application (no fluids or blood samples) from the majority of Canadians applying for these products. Over three-quarters of Sun Life’s critical illness insurance clients and half of life insurance clients will benefit from these changes.
  • Introducing automatic pre-screening for type 2 diabetes (using A1C test) when blood samples are required. Sun Life has proudly committed more than $17 million in support of diabetes awareness, prevention, care and research initiatives since 2012.
  • The transformation of its individual life insurance products making them more straightforward and flexible.

“This collection of underwriting and product enhancements represents some of the most comprehensive changes made in the industry in over a decade,” says Kevin Dougherty, President, Sun Life Financial Canada. “As part of our strategy, we are strengthening our commitment to making it easier for clients to plan for lifetime financial security and well-being. We are focused on continuing to develop innovative solutions that help do just that.”

Sun Life continually monitors global medical advances to review underwriting requirements and make the client experience easy and helpful. By removing many underwriting requirements, Sun Life is simplifying the application process for Canadians.

Enhanced life insurance products in Canada

In addition to making the mandatory tax exempt rule changes coming into effect January 1, 2017, Sun Life’s individual life insurance products are now even easier to understand and use.

Highlights include:

  • Being the first in the industry to offer clients the opportunity to have guaranteed paid-up participating life insurance policies in as little as eight or 10 years, while having protection for life.
  • Offering tailored universal life insurance with two new death benefit options, one targeted toward business owners and the other which gives clients the opportunity to leave their beneficiaries the basic insurance amount plus all payments made to the policy.
  • Offering diversified investment account options within universal life, including access to funds managed by Sun Life Global Investments (Canada) Inc.

“The new products demonstrate Sun Life’s commitment to understanding Canadians’ needs, and will provide them with a more comprehensive suite of insurance solutions that offer flexibility as their needs change throughout their lifetime,” says Mr. Dougherty.

Sun Life Assurance Company of Canada is a member of the Sun Life Financial group of companies.

About Sun Life Financial

“Common Sense” Used to Uphold Diminished Earning Capacity Award

Reasons for judgement were released this week by the BC Court of Appeal upholding an award for diminished earning capacity based on “common sense“.

In the recent case (Ali v. Glover) the Plaintiff was involved in two collisions and suffered chronic aggravation of degenerative issues in his neck and back.  The Plaintiff was able to continue working with his long-standing employer although some accommodations were made for limitations his injuries caused.  At trial the Court awarded $110,000 for diminished earning capacity on the basis that the Plaintiff’s injuries were permanent and very well could impact earning capacity in the future should he lose his present employment.

ICBC appealed arguing this award was rooted in speculation.  The BC Court of Appeal disagree noting it is simply a matter of common sense.  In upholding the assessment the Court provided the following reasons:

[19]         Mr. Ali’s case for damages for a loss in his earning capacity was based on the injury to his back precluding him from finding employment that would otherwise be available to him should the need arise.  The company for which he has worked for over 20 years has made adjustments to accommodate his limitations such that he does not do much of the “heavy lifting” that he once did, but for one reason or another his employment may be reduced in terms of the work available that he can do or be terminated altogether.  His loss is essentially one of a capital asset in that, because of his injury, he is less capable of earning income from all types of employment, less marketable, less able to take advantage of all employment opportunities which, save for his injury, may have been available to him, and less valuable to himself as an income earner, all as discussed in Brown v. Golaiy (1985), 26 B.C.L.R. (3d) 353 (S.C.).  The judge concluded:

[157]    I am satisfied the plaintiff has proven there is a real and substantial possibility of loss of income earning capacity in the future. He has an accommodating employer but she may retire and sell or reduce his wage to one commensurate with the hours he is working on set up and supervising and not allow him to draw on a dwindling overtime bank. If he loses his job he is less valuable to himself and potential employers because he is not fully able to do physical work.

[20]         The appellants do not challenge the judge’s determination of the quantum of the award; they contend that no loss has been proven.  They maintain the judge’s conclusion is based entirely on speculation that Mr. Ali may not be able to continue working in his present capacity earning the salary he is paid.  But the fact remains, Mr. Ali’s marketability has been impaired by the injury he suffered; he is not capable of doing heavy physical work so some employment that would otherwise be available to him is now foreclosed.  The judge made no fundamental error in concluding, as she did, there was a real and substantial possibility of Mr. Ali being able to earn less income in the future and giving what amount to examples of why there is no assurance Mr. Ali will always be employed as he is earning the income he does.  What is said to be speculation devoid of evidentiary support is largely a matter of common sense. 

[21]         I would not give effect to the fifth ground of appeal.

Ontario: Two gamblers spearhead class action against casino over hacking of private data

By Colin Perkel


TORONTO _ Two gamblers who allege their privacy was breached are spearheading a proposed class action against an Ontario casino whose databases were hacked.

In a notice of action, they also alleged Monday that Casino Rama, north of Toronto, unjustly enriched itself at the expense of the claimants.

In the allegations contained in the notice, Leonid Kaplan, of Barrie, Ont., says he provided casino staff with copies of his driver’s licence and credit card when he went there to gamble in September.

Kaplan says he received an email by the CEO of Casino Rama, John Drake, on November 10 with the subject line: “Unauthorized Access to Personal Information.”

The email stated that the organization had been the “victim of a cyberattack that resulted in the theft of past and present patron, employee and vendor information.”

The casino publicly confirmed the attack last week but did not say exactly when it occurred or over what period.

The other proposed representative plaintiff, Cheryl Mizzi, of Stouffville, Ont., says she and her husband regularly went to Casino Rama starting in 1999. They last visited in 2015. She, too, provided various forms of identification.

Neither proposed plaintiff have said what losses, if any, they incurred as a result of the privacy breach.

The lawsuit also names Ontario’s gaming commission, the Penn National Gaming and its Ontario subsidiary, which run the casino, and the Chippewas of Rama First Nation where the facility is located.

The suit, which has yet to be certified as a class action or tested in court, seeks $50 million in damages as well as another $10 million in punitive damages.

Lawyer Ted Charney said Monday the “unjust enrichment” claim arises from the casino generating revenues from gambling when customers thought reasonable security measures were in place to protect privacy.

“The casino elected not to invest in adequate staff and technology while collecting gambling revenues, promising to provide adequate security measures,” Charney said.

The suit also alleges the defendants breached contracts and violated consumer laws.

A Casino Rama spokeswoman did not address the allegations, but said Monday the organization was working with the authorities on the ongoing investigation.

“We are limited in how much detail we can provide,” Jenna Hunter said. “We deeply regret this situation and recognize the seriousness of the issue.”

Casino Rama Resort warned its customers, vendors as well as current and former staff last Thursday to keep an eye on their bank accounts, credit cards and other financial information.

The casino said it had “recently” discovered becoming the victim of a cyberattack that resulted in the large-scale data theft.

Stolen data appeared to include internal financial and security-incident reports, emails, payroll data, client information, social insurance numbers, and dates of birth, according to the casino.

“The hacker claims that the employee information dates from 2004 to 2016, and that some of the other categories of information taken date back to 2007,” the casino said in a statement.

The resort, which has 2,500 slot machines and more than 110 gaming tables, said the games themselves weren’t hacked.

Located on Rama First Nation, the casino opened 20 years ago.


Canadian golfer Dawn Coe-Jones dead at 56

Canadian golfer Dawn Coe-Jones dead at 56

Dawn Coe-Jones, a member of the Canadian Golf Hall of Fame who helped blaze a trail for Canadian women on the pro tour, has died of cancer. She was 56.

Golf Canada said Saturday that Coe-Jones died at a hospice near her home in Tampa, Fla. She had been diagnosed with bone cancer earlier this year.

The native of Lake Cowichan, B.C., played on the LPGA Tour from 1984 to 2008. She won more than US$3.3 million on the circuit with three victories and 44 career top-10 finishes.

“Dawn was a great competitor and role model for over 25 years on the LPGA Tour,” said Canadian Golf Hall of Famer Sandra Post. “Her happy and positive attitude towards life will be missed by all that knew her.”

The golf world took to social media Saturday to mourn Coe-Jones.

Mike Weir of Brights Grove, Ont., called Coe-Jones a “great player & competitor & wonderful lady!” in a tweet.

Brantford, Ont., native David Hearn tweeted: “Very saddened to hear of the passing of Dawn Coe-Jones. She was a great player and role model for so many Canadians. You will be missed Dawn.”

Former LPGA Tour pro A.J. Eathorne of Penticton, B.C., posted a photo collage of her and Coe-Jones on her Instagram account.

“A very sad day today as we say good bye to our dear friend Dawn Coe Jones,” the caption read. “One of the most caring and wonderful women I have ever met. I am so lucky to have got to spend so many great times with her and her family. Love you always Miss Dawn.”

“Just hearing of the incredibly sad news of the passing of @LPGA member & Canadian legend Dawn Coe-Jones. Always a class act. RIP, my friend,” said American golfer and broadcaster Dottie Pepper.

“So sad to hear the passing of @LPGA Dawn Coe Jones. A true competitor, ambassador of the game. She will be missed #RIP,” echoed Hall of Famer Annika Sorenstam.

Coe-Jones had an outstanding amateur career, scoring back-to-back wins in the B.C. Junior tournament in 1978 and ’79 and the B.C. Amateur in 1982 and ’83. She capped her 1983 season with the Canadian Amateur title and won NCAA all-American honours at Lamar University.

Her first LPGA win came at the Women’s Kemper Open in 1992. She went on to claim the 1994 LPGA Palm Beach Classic and 1995 Tournament of Champions.

A fervent Montreal Canadiens fan, she savoured getting a Habs jersey with No. 1 on the back after winning the Tournament of Champions.

She was inducted into the Canadian Golf Hall of Fame in 2003.

”I was totally caught off guard,” Coe-Jones said at the time. ”In fact, I had to make sure someone wasn’t playing a trick on me. I am just thrilled and proud to be included in such good company.“

A veteran of more than 20 Canadian Opens, Coe-Jones said she had learned to embrace playing at home.

”Over the years I’ve learned that you just go out there and enjoy the atmosphere and feed off the fans,“ she said in 2006. ”They are there to support you and want Canadians to do well.”

Growing up in Lake Cowichan on Vancouver Island, she worked as a teenager at March Meadows Golf Course in Honeymoon Bay.

“I drove an old Ford tractor, cutting grass and raking bunkers by hand,” she recalled in an interview with Golf Canada magazine. “We didn’t have the equipment they’ve got now.”

She honed her golf game at March Meadows before heading to Lamar University, where she won a scholarship in her sophomore year.

Coe-Jones made her farewell appearance at the CN Canadian Open in 2008 with her trademark beaming smile despite finishing 14-over after two rounds and missing the cut.

Coe-Jones was accompanied by caddie and childhood friend Kelly Feltrin, who was on her bag when she won the Kemper Open.

Her best score ever was 63 at the Safeco Classic in 1998.

Coe-Jones’ best chance to win her national Open was in 1993, when she was third behind Brandie Burton and Betsy King at London Hunt. She tied for fourth with Canadian Gail Graham in 1998 in Windsor, Ont.

”I feel very proud of my career,” Coe-Jones said in 2008. ”I wish everyone who was ever out here had that opportunity to walk up 18 and be the winner just once.

”It’s a wonderful feeling to be the best in your field one time. I was lucky enough to have it three times.”

She married Jimmy Jones in 1992 and their son James was born three years later.

“On behalf of the entire golf community we are deeply saddened by the passing of Dawn Coe-Jones,” Golf Canada CEO Scott Simmons said in a statement. “Dawn was a tenacious competitor, a mentor and friend to so many of her peers and a proud ambassador for Canadian golf throughout her distinguished career.

“As we mourn her passing and send our most sincere condolences to family and friends, the golf and sport community come together in celebrating her outstanding legacy.”


Please help us raise funds for DCJ in her fight against Sarcoma.  

Our goal is $75,000 in the next 10 days.

Thanks for your support…Let’s get this done!!

Help spread the word!
Please consider being part of this great Challenge - for Dawn.

Please consider being part of this great Challenge – for Dawn.

Subscribe To Our Newsletter

Join our mailing list to receive the latest news and updates from ILSTV

You have Successfully Subscribed!

Pin It on Pinterest