Owner failed to show that insured/driver did not have permission to drive car therefore no exclusion.

May 05, 2012, Kitchener, Ontario

Posted by: Robert Deutschmann, Personal Injury Lawyer

Before: John Wilson

Heard: February 6, 7 and 8, 2012


R.P. was injured in a motor vehicle accident on April 11, 2009. He applied for and was denied certain statutory accident benefits from Intact Insurance Company ("Intact"), payable under the Schedule. The parties were unable to resolve their disputes through mediation, and Mr. P. applied for arbitration at the Financial Services Commission of Ontario under the Insurance Act.

Because Mr. P. was not an adult at the time of the events outlined in this decision, an order has been made pursuant to section 9 of the Statutory Powers Procedure Act, that the name and the identity of the Applicant not be revealed in any public version of this decision.

The issues in this hearing are:

  1. Is Mr. P. barred from receiving a non-earner benefit by reason of the fact that he knew or should reasonably have known that at the time of the accident he was driving a vehicle without the owner's consent, as set out in the Schedule.


  1. Intact has not met its burden of proving that, at the time of the accident, Mr. P. knew or should reasonably have known he was driving the 1998 Lincoln Mark VIII without the owner's consent, as set out in the Schedule.



This hearing arises from a tragic series of events, involving young people, the use of alcohol and the use of a motor vehicle belonging to a family with whom the Applicant was living.

Both parties jointly filed an Agreed Statement of Facts in this matter. The statement sets out eight material facts which are not disputed, and form the background of this dispute.

There is no dispute that RP. was the sole driver and occupant of the 1998 Lincoln Mark VIII which was involved in the April 11, 2009 accident, that as a result of the accident R sustained a serious head injury and has no memory of the events leading up to the accident, and that he was 17 years old at the time of the accident and possessed a G1 licence.

There is also agreement as to fact that at the time of the accident and since mid-November of the previous year Mr. P. lived with D and Linda S. and their son TS, having left his own parents' house.

DS owned six motor vehicles, including two snowmobiles and the 1998 Lincoln involved in the accident. Neither LS nor TS owned any vehicles. Three of the vehicles, including the 1998 Lincoln, were insured by Intact. The policy with Intact showed DS as the named insured and principal driver of two vehicles, including the 1998 Lincoln. LS was shown as principal driver of one vehicle. Their son, TS was shown as an occasional driver of a second Lincoln (2000 LS).

The Arbitrator was advised by the counsel for Intact that, but for the section 30 issue, Mr. P. would be otherwise accepted as qualifying for non-earner benefits.

Both parties agreed that, since the operation of the exclusionary clause is the only issue to be arbitrated, the onus in this matter rests with the Insurer to prove on the balance of probabilities that at the time of the accident Mr. P. knew or should have reasonably known that at the time of the accident he was driving a vehicle without the owner's consent.

Another unusual aspect of this case was that although Mr. P. was present for the commencement of the hearing, he was not called upon to testify by either side since both agreed that one of the consequences of his injuries is that he has no memory of the events leading up to the accident.

As noted in the Agreed Statement of Facts, the underlying narrative is not in dispute. In 2008, RP was a student at a secondary high school in Kitchener. As with many teenagers he apparently was impatient with rules, both at home and school.

In the fall of 2008 he decided to leave home, and first asked to stay with a friend. This arrangement lasted about a week, following which he was allowed by the S family to stay with them. The friend attributed R's departure from his house to his low tolerance for rules.

Mr. and Mrs. S assert that R stayed with them on condition that he continued to attend school and observed an 11:00 p.m. curfew on weeknights. He paid no rent or board.  The evidence is consistent that R neither consistently attended classes, nor rigorously observed the curfew.  D and L's son TS was a close friend of R's at school, and they were known to socialize together.

Socializing for that group of peers, the friends of both R and TS, included significant consumption of alcohol, both at house parties and other gatherings. Some of this considerable consumption occurred at the family residence, including a large party on New Year's Eve, and a smaller gathering on the eve of the accident, which was arranged to celebrate TS's upcoming 18th birthday.

R lived with the S family from mid-November 2008 until the accident on April 11, 2009.

D and L's son TS drove the 1998 Lincoln on virtually a daily basis, both to school and elsewhere as required, notwithstanding that he was listed only as an occasional driver on the 2000 Lincoln and on no other vehicle. LS principally drove the 2006 Lincoln Navigator. DS drove a minivan provided for by his employer, the 1976 Pontiac Trans Am, in summer, and, he claimed, all the other cars whenever he needed them.

The testimony of both LS and TS  differed substantially from that of DS as to the predominate use of the cars, especially the 1998 Lincoln. Both L and TS noted TS's predominate use of the 1998 Lincoln and the fact that he used it virtually daily to attend both school and work.

The Arbitrator had some difficulty with DS's overall testimony. Mr. S demonstrated selective memory and the entirely human tendency to remember situations in a manner which put him in a better light, a tendency that gave the impression he was tailoring his testimony to reflect what he evidently perceived as his interest and that of the family.

This was most conspicuous with regard to his recollection of the New Year's Eve party held by the boys in his basement. TS, TP, JG. and RK. confirmed that this was a typical party for their set − with lots of drinking and indeed drunkenness. If Ms. K's recollection is correct there was also marijuana being smoked at the same time.

DS testified that he went down to the basement once to check on things but saw no evidence of illegal consumption of alcohol. Nor did he mention the unmistakeable smell of marijuana, which would have been hard to miss in a confined space such as a basement.

TS testified that he was quite drunk at the time. TP, JG and Ms. K all testified as to the significant amount of alcohol being consumed. LS testified that she was aware that drinking was going on and that her son was inebriated. TP stated that he remembered DS coming down into the basement once, but only to complain that someone had taken beer from the fridge.

All the witnesses confirmed heavy drinking except DS.  While the facts of the New Year's Eve Party are only important inasmuch as they demonstrate the fairly loose controls present in the S. home and the propensity of R's peer group to engage in serious drinking, the divergence of Mr. S's testimony from every other account gave the Arbitrator pause to wonder when asked to accept at face value his declaration that R was never permitted to drive his vehicles.

While Mr. S was adamant that R understood that he could not drive any of the family cars, when pressed, the only example he could dredge up of a conversation with R concerned a car driven and owned by his elder son which was temporarily parked at the family residence.

Despite his firm memory of setting boundaries concerning the use of his own vehicles, Mr. S could cite no occasion when he spoke directly to R on the subject. Nor did his son TS or his wife L speak of witnessing any admonition from DS explicitly instructing R that he was not permitted to use any vehicles.

Mr. S claimed that he advised his son TS that no-one else was permitted to drive family vehicles, including the 1998 Lincoln that TS used, and which was driven by RP. at the time of the accident.

Although initially denied by DS in his statement to the police, various witnesses had seen R drive the 1998 Lincoln in the period surrounding the accident. RK mentioned that R drove her from time to time, when they were dating. TS would not have been in the vehicle at those times.

TS admitted that he had at various times given R permission to drive the 1998 Lincoln. DS consequently modified his testimony at the hearing accordingly.

Given the appearance of fairly generalized access by R to the 1998 Lincoln over a period of time, it is surprising that DS never noticed the car's absence, especially since he testified that he, himself, was in the habit of using the 1998 Lincoln from time to time and was shown as its principal driver.

While counsel for the Applicant made much of DS's alleged misrepresentation in applying for his motor vehicle insurance, the Arbitrator did not accept that a willingness to mislead an insurer necessarily leads to a conclusion that all his evidence is somehow tainted. Evidence of propensity is properly excluded as collateral in any consideration of guilt or innocence (Hickey v. Fitzgerald (1877) 41 U.C.Q.B. 303).

In this matter however, it is clear that Mr. S was either misinformed or was mistaken with regard to elements directly relating to this case. These range from his son's frequent inebriety, to the extent of his son's use of the 1998 Lincoln, and whether or not the parents actively drove TS to school. DS's obvious attempt to dissimulate to the police concerning TS's condition the night of the accident, while to some degree understandable, brings into question the credibility of any of his evidence that is not specifically corroborated by other, more reliable witnesses.

Although the 1998 Lincoln was registered in Mr. S's name, and D was named as the primary driver, contemporaries of TS, including Jordan G., referred to it as TS's car, possibly because he always had it at his disposition.

TS claims that after an incident in which the 1998 Lincoln was damaged, TS had forbidden R from further driving the vehicle. However, TP, who was drinking with TS and R the night of the accident, stated to the police that TS had acquiesced in having R drive him home from TS's house provided that R would wake TS up when he returned.

While the Arbitrator had no reason to doubt that that incident regarding the damage done to the 1998 Lincoln by R may well have happened, there is no evidence that this forever ended R's use of the vehicle, or that TS did not consent to R's use of the 1998 Lincoln the night of the accident.

There is considerable evidence that all the young men that evening had been drinking and that TS, especially, had consumed an inordinate amount of alcohol that evening. He would have been quite drunk at the time that he allegedly consented to R driving the 1998 Lincoln.

Without R's testimony it is difficult to know exactly what was in his mind that night when he slipped into the driver's seat of the 1998 Lincoln. Discerning state of mind in this matter is of necessity a process of inferring from the surrounding circumstances. The Arbitrator noted, however, that is not incumbent upon RP to prove that he had consent or believed that he had consent. Rather it is Intact who must prove the contrary.

While it is always possible that R had the consent, either express or implied, of Mr. S, the testimony of both TS and DS is that he did not. Even though DS may not be the most reliable historian, the absence of R's testimony makes a clear determination difficult at best.

The only glimmer of light thrown on the issue of direct consent is the conversation reported by JG which might suggest that possible direct consent was not altogether unlikely.

Otherwise, the testimony of JG, TP and RK suggested that there was a significant pattern of R driving the 1998 Lincoln both in the presence of and the absence of TS.

More controversially, JG testified that R had reported to him during a conversation in the family's hot tub that he wasn't free one evening since he (R.) had to pick up Mr. and Mrs. S with the Lincoln Navigator as they had been drinking and needed a ride home.

This latter comment, which could have suggested a direct acquiescence by Mr. and Mrs. S to R's use of their vehicles, was challenged by Intact on the basis that it had not been put directly to Mr. S in cross-examination, and since it tended to bring the credibility of Mr. S. into play, it offended the rule in Brown v. Dunn, (1893) 6 R 67 H.L.It, was also patently hearsay, with all the attendant frailties of such testimony.

The rule in Brown v. Dunn is a particular challenge to parties in the context of an arbitration, where every effort is made to streamline the hearing process and to avoid lengthy and often unnecessary questioning and cross-examination. The principle has been described as follows:


The rule in Browne v. Dunn is a rule of fairness: if counsel is going to challenge the credibility of a witness by calling contradictory evidence, the witness must be given an opportunity to address the contradictory evidence. It may be that counsel is not required to put every contradictory detail to a witness. (R. v. Hall, 2010).
The principle in Browne and Dunn is that counsel must give a witness an opportunity to respond to evidence that will challenge the credibility of that person. The witness must have that chance while in the witness stand. The person wanting to use the contradictory evidence of the witness cannot create an ambush and pounce upon the person after that individual is out of the stand      (Morrison v. Greig, 2006).

While Mr. S was cross-examined on his statement that he had never permitted R the use of his vehicles, this hot tub incident was not expressly put to DS Jordan G's testimony clearly challenges Mr. S's evidence that R never had permission to drive his vehicles.

Complicating matters further however, the challenge JG's evidence came by way of Reply submissions, rather late in the proceeding, and not at the time the evidence was proffered. As such, the objection was less than timely.

Counsel for the Applicant had consistently challenged Mr. S's position that no consent ever had been or would be given to drive one of his cars, but not this particular fact situation. In fairness Mr. S should have been given the opportunity to reply to this challenge when being cross-examined and wasn't.

There is no suggestion that DS would have been present for the "hot tub statement", or that he could add anything to the meaning or understanding of the statement other than to deny the truth of it. Indeed, the witness was vague enough as to the exact time of the conversation as to render any detailed response difficult. However, counsel for Intact effectively gave voice to the denial of the factual veracity of the comment through his cross-examination of JG.

The Arbitrator accepted that, technically, the testimony of JG offends the rule in Brown v. Dunn since Mr. S was not directly confronted with it and had no opportunity to respond. That, however, is not the end of the story. As Halsbury's Laws of Canada (Modes of Proof, 1 Oral Evidence) states:


There is however no fixed rule as the consequences of a failure to observe this principle. It may be possible to recall the witness, if not, and depending on the facts of the case, it may be appropriate to remind the jury to consider the lack of questioning in assessing the credibility of the contradicting witness, or to permit the opposing party to be cross-examined on the matter to suggest concoction.

As noted earlier, if R had either direct consent from the owner to drive the 1998 Lincoln on the night of the accident, or if he had a reasonable belief that the owner consented, then he is eligible to claim non-earner benefits as some compensation for the major disabilities arising from this accident.

In the first scenario, R would have had to have consent from DS, who was the registered owner. That is denied by Mr. S. Consent, however, can be either explicit or implicit and implied. A pattern of consensual use for example, might suggest that the use on the night of the accident was also consensual.

It is also noteworthy that, while Mr. P was charged by police with certain driving offences, including those related to his level of alcohol after the accident, the Crown brief filed reveal no charges arising from taking the vehicle without the consent of Mr. S.

While police and the Crown have significant discretion in charging and prosecuting an individual, and the burden of proof is different in a criminal matter, a reasonable inference might be that, unlike the very serious driving offences which R faced, the police believed that any charges related to the lack of consent by Mr. S in the use of the motor vehicle would not be sustainable.

The real issue here is not direct consent. Mr. S has said he would not have consented, and however incredible Mr. S's testimony may be, there is only a second-hand statement that might imply direct consent available to contradict him.

It is much more likely that TS consented to R driving the 1998 Lincoln that night. In law, however, it is clear that a person in TS's position, a user in possession of the vehicle who is not the legal owner, may not, in the presence of a specific prohibition to do so, grant another the legal permission to drive the car in such a way as to bind the legal owner (Collins v. Wright [1988])

If we accept DS's testimony that he specifically forbade TS to permit others to drive the 1998 Lincoln, then TS, in law, could not have authorized R to drive the vehicle.

The live issue however is, what was in R's mind that night when he drove the 1998 Lincoln.

More specifically, the question is whether he believed he received consent to drive from TS who had possession of the car, and whether that belief was reasonable.

In the absence of R's testimony, it is hard to say what specifically was in R's mind at the time of the accident. Did he believe that the vehicle belonged to other than DS? Did he believe that even if it didn't belong to TS, that TS was authorized to give permission for a third party to drive?

The hot tub statement, notwithstanding its frailties, suggests that R expressed a belief that he was authorized to drive vehicles owned by the S. family. The statement would be hearsay, with all its frailties, if relied upon for the truth of the statement.

Hearsay, however, is admissible in an arbitration proceeding. The importance of the statement is not whether or not R drove Mr. and Mrs. S. home in their car, or that they had too much to drink, but rather that the statement evidenced to some degree the state of R's belief as to his use of the family vehicles.

To the extent that the incident related is credible, the Arbitrator accepted the admissibility of the hot tub statement as evidence of R's state of mind, subject to Halsbury's Browne v. Dunn caution that I should "remind the jury (the decider of fact) to consider the lack of questioning in assessing the credibility of the contradicting witness." In my mind, it is some evidence that R believed, perhaps wrongly, that he was not barred from driving the family vehicles.

Even so, we come back to the question of what were the circumstances which could prompt R to believe consent was given. If the consent was from TS, did his extremely inebriated state the night of the accident vitiate any consent?

A credible witness has stated that TS gave R the keys. TP reported that TS is supposed to have said just to wake him up when he (R.) got back. TS has no significant recall presumably because of the 15 beers and 13 oz. of rum he claims to have consumed that night. The story, however, has the ring of truth and would appear to be consistent with past practice. After all, TS had given R the keys many times before.

While a reasonable, prudent person might have reservations about accepting the keys from someone as drunk as TS was that evening, the statement given to police by TP and his evidence at the hearing would suggest that it was not abnormal in the situation. TP needed a ride home. TS had a car but was in no state to drive. R appeared reasonably in control and had often driven. To 17 year old party-goers, the transaction would make eminent sense.

Finally, we come to the issue what should be a reasonable belief in the mind of RP that night and by what standard should that state of mind be judged?

There is evidence that R believed he had permission from time to time to drive the family vehicles. There is evidence that he did so, both in the company of TS and alone or with another person.

There is evidence that TS had possession of the 1998 Lincoln, that it was known as TS's car and that TS had consented to R driving through handing him the keys. While possibly incorrect in law, R would have had this in mind when he set out to take the 1998 Lincoln on the night of the accident.

The word "reasonable" used in section 30, is loaded with baggage from the world of torts and otherwise. The concept of the reasonable person in tort has been debated and tortured to death through endless jurisprudence. However, the Arbitrator was not entirely convinced that these historic tort definitions are the necessary starting point for understanding section 30 of the Schedule.

The Canadian Oxford Dictionary defines "reasonable" as:

1 Having sound judgment; moderate; ready to listen to reason. 2 in accordance with reason; not absurd. 3 a within the limits of reason; fair, moderate (a reasonable request). b inexpensive; not extortionate. c fairly good, average (the food here is reasonable).

Similarly, the Larousse dictionnaire française defines « raisonable » as follows :

Doué de raison : L'homme est défini comme animal raisonable. Qui pense, agit selon la raison, le bon sens, la mesure et la réflexion: Vous n'êtes pas raisonnable de fumer ainsi. Qui manifeste ce bon sens, ce sens de la mesure : Cette décision a paru raisonnable à tous. Qui manifeste de la modération dans les affaires, le commerce etc. Consentir un prêt à des conditions raisonnables. Qui se situe dans une honnête moyenne, qui est modéré mais suffisant : Offrir à un débutant raisonnable.

Both the English and French definitions of "reasonable/raisonable" are wide and lend themselves to many different interpretations. Not surprisingly, both parties referred for assistance to the tort concept of "reasonableness" in Arland v. Taylor:


The standard of care by which a jury is to judge the conduct of parties in a case of the kind under consideration is the care that would have been taken in the circumstances by "a reasonable and prudent man". I shall not attempt to formulate a comprehensive definition of "a reasonable man" of whom we speak so frequently in negligence cases. I simply say he is a mythical creature of the law whose conduct of all other persons and find it to be proper or improper in particular circumstances as they may exist from time to time. He is not an extraordinary or unusual creature; he is not superhuman; he is not required to display the highest skill of which anyone is capable; he is not a genius who can perform uncommon feats, nor is he possessed of unusual powers of foresight. He is a person of normal intelligence who makes prudence a guide to his conduct. He does nothing that a prudent man would not do and does not omit to do anything a prudent man would do. He acts in accord with general and approved practice. His conduct is guided by considerations which ordinarily regulate the conduct of human affairs. His conduct is the standard "adopted in the community by persons of ordinary intelligence and prudence." See Blyth v. Birmingham Waterworks Co. (1856), and Mazengarb, Negligence on the Highway, 2nd ed. 1952, p. 15.

The Arbitrator did not find, however, that tort concepts of standard of care are of much utility in analyzing whether R had consent or a reasonable belief in consent to drive the 1998 Lincoln the night of the accident. Prudence is not known to be a hallmark of 17 year old young men.

The use of "reasonable" and "unreasonable" however is not limited to the tort forum. The term is also used in the context of judicial review of a decision-maker's decision. Just as section 30 of the Schedule obliges us to review the reasonability of R's belief as to consent to drive a vehicle, judicial review examines the reasonability of an adjudicator's decision in the context of the evidence before him or her. In both cases it is the evaluative process that is at issue.


A court conducting a review for reasonableness inquiries into the qualities that make a decision reasonable, referring both to the process of articulating the reasons and to outcomes. In judicial review, reasonableness is concerned mostly with the existence of justification, transparency and intelligibility within the decision-making process. But it is also concerned with whether the decision falls within a range of possible, acceptable outcomes which are defensible in respect of the facts and law (Dunsmuir v. New Brunswick, 2008.

"Reasonable" in this context would seem to evoke the second approach listed in Oxford.

2 In accordance with reason; not absurd. 3 a within the limits of reason; fair, moderate (a reasonable request)."

As to the use of "reasonably" in the accident benefit field, Arbitrator Palmer commented in Jacobs and Economical Mutual Insurance Company, 1994:


I conclude that the use of the word "reasonably" in the phrase "ought to have reasonably known" of section 17(3) (b) of the Schedule means that an individualized inquiry is called for, but only to the extent of the exercise of reason by an ordinary, rational person in the situation of the Applicant. The evidence must convince the arbitrator, at least on the balance of probabilities, that an ordinary person in Peter Jacobs' situation that night should have known that Adam Toulouse was driving the Grand Am on May 30, 1992, without the consent of Karen Trudeau-Toulouse.

The key and problematic words used by Arbitrator Palmer were "the exercise of reason by an ordinary, rational person in the situation of the Applicant." There was much discussion in submissions as to the degree, if any, that "rational person in the situation of the Applicant" referenced the direct peer group of the Applicant, namely seventeen year old male high school students with a propensity to party hard, or whether it extended far beyond that group towards the mythological reasonable person.

Another way of approaching the provisions in section 30 may give some more insight than merely trying to parse the grammatical meaning of an expression.

The provisions in section 30 are little more than a codified version of the basic principles of insurance law dating back to its origins in the law merchant. An insurance contract is a contract of uberimae fideis. Thus a person tainted with the commission of a crime related to the circumstances giving rise to a claim could not claim indemnification from an insurer for the consequences of his wrongdoing. The courts have observed:

Forbidding him to take advantage of his own wrong is another matter, for this means that something, which in itself would be his of right under the contract, is denied to him, because the law is more moral than the contract. Of course, it is true that he cannot take advantage of his own wrong, or as it is sometimes put "Dolus circuitu non purgatur."


Often characterized as "public policy", see Oldfield v. Transamerica Life Insurance Co. of Canada, 2002 SCC 22, where the court held that: "unless modified by statute", public policy operates independently of the rules of contract. For example, courts will not permit a husband who kills his spouse to obtain her life insurance proceeds, regardless of the manner in which the life insurance contract was worded. As Ferguson J. held in the Court below, public policy "applies regardless of the policy wording - it is imposed because of the court's view of social values."

The nub of the section 30 exclusion is that the driver took possession of the vehicle and drove it without either consent of the owner or a reasonable belief that he or she had that consent.

At common law the taking of something without the consent of an owner constituted theft. Indeed, what is alleged by the Insurer is a criminal offence, both under the common law and the modern Criminal Code. Under the Criminal Code, unauthorized driving could implicate either section 322, the general provision for theft or alternatively the lesser offence of "joyriding" found at section 335.

Both the traditional and modern offences however are slightly more nuanced. What is actually involved in the offence is a non-consensual taking "without colour of right." That means that if someone takes a vehicle, reasonably believing that they may have a right to use it, either through ownership or the consent of someone reasonably seen as capable of giving that consent, they have a defence to the charge of theft or conversion.

Given the similarities in circumstance it may be illustrative to examine how the courts deal with the reasonableness of a "colour of right" in the context of theft.

The defence of colour of right exists where an accused has "an honest belief in a state of facts which, if it existed, would be a legal justification or excuse." In Mr. P's case, a colour of right would be the belief that he had the consent of the owner to drive the 1998 Lincoln, whether directly or indirectly through TS.

The courts have long made it clear that any analysis of "colour of right" must look into the state of mind of the individual.


Ignorance of the law cannot excuse any person; but, at the same time, when the question is, with what intent a person takes, we cannot help looking into their state of mind; as, if a person take what he believes to be his own, it is impossible to say that he is guilty of felony (Reg. v. Reed (1842).

That belief of course is subject to the constraint that it be: "In accordance with reason; not absurd." To stand scrutiny as reasonable a belief must be "within a range of possible, acceptable outcomes which are defensible in respect of the facts and law." (Dunsmuir v. New Brunswick, 2008).

The Arbitrator accepted that given the evidence of continued use both with and without TS, without any consequences, the evidence that others considered the 1998 Lincoln to be TS's car, and that TS appeared to have exclusive use of the car, R could reasonably have concluded that TS could consent to his driving the 1998 Lincoln. Such a conclusion, given the context would not be "absurd."

The testimony of TP was that TS acquiesced in R driving him home that evening. He only asked to be wakened up when R returned. According to the statement given to police by TP, TS even gave R the keys.

R may have been legally wrong that TS was in a position to consent, but given the previous conduct it would not be unreasonable for a youth in R's position and environment to believe in the validity of any consent.

Once again, the Arbitrator pointed to the lack of any positive evidence that DS's supposed interdiction of R's driving was ever brought to R's attention. Neither the scenario surrounding the elder son's car, or TS's apparently temporary withdrawal of permission following damage to the 1998 Lincoln are unambiguous.

Modern jurisprudence has held that a belief in something could be reasonable even if that belief misstated the law as long as it is "an honest belief in a state of facts which, if it existed, would be a legal justification or excuse." ( R v. Johnson, 1904).  Lord Westbury in Cooper v. Phibbs clarified the inter-relationship between mistake of fact and law in civil matters:


It is said "ignorantia iuris haud excusat"; but in that maxim the word "ius" is used in the sense of denoting general law, the ordinary law of the country. But when the word "ius" is used in the sense of denoting a private right, that maxim has no application. Private right of ownership is a matter of fact; it may be the result also of matter of law; but if parties contract under a mutual mistake and misapprehension as to their relative and respective rights, the result is that that agreement is liable to be set aside as having proceeded upon a common mistake (Cooper v. Phibbs).


Belobaba J. in R v. Castro provided the following summary:


One acts with a colour of right when he acts under an honest and genuine misconception of fact or law – that is, he has an honest belief that that he is entitled to money or property even if that belief is mistaken in fact or law, R v. Castro, 2008

R's belief that he had consent to drive the 1998 Lincoln would be just such a "colour of right" and hence, within the context of his age and social group, a reasonable belief. Such a belief would be "not absurd" and "within the limits of reasonable" even if he misapprehended the right of TS to consent to the use of the 1998 Lincoln on the night of the accident.

The Arbitrator repeated his observations that the direct evidence as to R's belief and the reasonableness of such belief on both sides of this matter has been less than ideal. Part of this arises from the acknowledged inability of RP to testify as to the events of that evening and his relationship with the S family.

Part of this is attributable to the weakness of the evidence of DS, whose veracity appeared at times quite strained. The complete inability of TS to recall the passing of the keys to R, while attributed to the effects of alcohol, is also disappointing.

We are not however without evidence on this issue, both positive and negative, however circumstantial. A useful step in the final analysis of this evidence would be to consider the evidentiary burdens that should be attributed to the individual parties on the various issues.

Both parties are in agreement that the evidentiary burden in this matter must fall upon the Insurer, Intact. Viscount Dunedin in Robins v. National Trust commented on the utility of such an examination:

... onus as a determining factor of the whole case can only arise if the tribunal finds the evidence pro and con so evenly balanced that it can come to no sure conclusion. Then the onus will determine the matter. But if the tribunal, after hearing and weighing the evidence, comes to a determinate conclusion, the onus has nothing to do with it, and need not be further considered (Robins v. National Trust).

Even recognizing the frailties of the evidence on both sides of the equation, the Arbitrator found that it is credible that RP can reasonably not have known that at the time of the accident that he lacked consent to drive the 1998 Lincoln.

Even if the Arbitrator erred in giving too little credence to DS's evidence, the Insurer still has not met its onus of establishing that the section 30 exemption applied since even Mr. S could not point to a direct communication to R of a refusal of consent to drive his vehicles.

This, taken with the evidence of the flagrant and open pattern of use of the 1998 Lincoln by R over an extended period of time, the appearance of consent that evening by TS S. fail to support the assertion that R should have known that he did not have consent to drive.

The Arbitrator had no doubt that the situation revealed in this case has been trying for all concerned. While the S. family may well feel that their freely given hospitality has been abused by R's destruction of their vehicle, and the resultant difficulties, we are still faced with an accident benefit claimant whom both sides acknowledge as meeting the difficult test for non-earner benefits.

The only question is whether the section 30 exclusion should be applied to bar RP's claim for accident benefits. It is trite law that insurance coverage clauses should be liberally interpreted while exclusionary clauses should be narrowly interpreted. This applies equally to accident benefits since they are incorporated in and arise by virtue of an insurance policy.

In this case, such an approach would suggest a larger interpretation of "reasonable belief", one that went beyond the narrow view of the mythological "reasonable person" of tort and encompassed the context of youthful drivers.

Consequently, the Arbitrator found Intact has not met its burden of proving that, at the time of the accident, RP knew or should reasonably have known he was driving the 1998 Lincoln without the owner's consent, as set out in section the Schedule.

Posted under Accident Benefit News, Automobile Accident Benefits, Brain Injury, Car Accidents, Drunk Driving Accidents, Slip and Fall Injury

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  4. Catastrophic injury
  5. Brain or Head injury
  6. Paraplegia and Quadriplegia
  7. Spinal cord injury
  8. Drunk driving accidents
  9. Concussion syndrome
  10. Post Traumatic Stress Disorder
  11. Slip and Fall Accidents
  12. Birth Trauma Injury
  1. Wrongful death
  2. Bicycle accidents
  3. Disability insurance claims
  4. Slip and fall injury
  5. Fractures or broken bone injury
  6. Pedestrian accidents
  7. Chronic pain
  8. Truck accidents
  9. Amputation and disfigurement
  10. Fibromyalgia
  11. Nursing Home Fatality Claims

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