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Tuesday Morning Case Bites for April 6, 2021

Last Week’s Court Rulings from the Alberta Court of Queen’s Bench, Court of Appeal and SCC.

Edited by Tony Slemko Q.C. & Steven Graham

Barz v Driving Force Inc, 2021 ABQB 248
Vicarious Liability | Worker’s Compensation Act | Care and Control

The Driving Force rented a truck to a corporation. The corporation’s employee drove the truck into a ditch, injuring the passenger who was also an employee of the corporation. The employees were in the course of their employment, and as such the Workers Compensation Act applied, barring lawsuits between the parties. The exception was the Driving Force, who was the owner of the truck, and not protected from vicarious liability under the Traffic Safety Act by the bar to suit in the Workers Compensation Act.

The Master in Chambers granted the Driving Force’s summary dismissal application, finding that notwithstanding there was an action against the Driving Force, there was no evidence establishing several liability on the part of the Driving Force. The Plaintiff, represented by the WCB, appealed.

The Justice hearing the appeal noted that there was no new evidence submitted by the Plaintiff from that which the Master relied upon. The Justice dismissed the Plaintiff’s assertions that questions in cross-examination were not answered, and were relevant to the rental agreement and whether the Driving Force had care or control of the vehicle in question, as the Plaintiff did not provide any other evidence to found those assertions, or to show they made any effort to compel such answers from the Driving Force.

The Justice cited the leading authorities regarding care and control:

[15]           In McIver v McIntyre2018 ABCA 151, leave to SCC denied 2019 Canlii 10537, the owner dropped his vehicle at a repair shop and authorized his vehicle to be test-driven. The court upheld the trial judge’s finding of zero per cent liability to the owner. That finding at trial was based on a record that the repair shop was in a position to supervise the driver whereas the owner was not. At the time of the accident, the repair shop had full control of the vehicle and supervised the driver, whereas the owner did not. Citing Blackwater v Plint2005 SCC 58, the court in McIver found the trial judge had appropriately considered “the crucial factors” in Blackwater of the level of supervision over, and direct contact with, the tortfeasor:

[72] …The trial judge found that Mr. McIntyre did not have the power, factually or legally, to supervise Mr. Morgan and there is no evidence to contradict that finding. Further, the agreed statement of facts does not indicate that Mr. McIntyre had any direct contact with Mr. Morgan (although direct contact on its own would not be enough). By contrast, the trial judge found that Calgary Propane had the power to supervise Mr. Morgan because it was his employer and it had direct contact with him. Again, there is no contrary evidence. It follows that the trial judge’s apportionment of 100% of the loss to the “fault” of Calgary Propane should be upheld.

[16]           Barz relies on the final paragraph in McIver which states:

[74] To clarify, our decision should not be understood as establishing that every time a vehicle owner leaves a vehicle at a garage for repairs, and an employee takes the vehicle out for a test drive and negligently injures a plaintiff, the employer garage is always (notionally) liable for 100% of the loss. The trial judge’s decision on apportionment was sensitive to Mr. McIntyre’s and Calgary Propane’s degrees of supervision over, and contact with, the negligent driver. On different facts, other considerations and a different apportionment might well be appropriate.

[17]           But as noted by the Master in Paccar, with whom I agree, if a car owner who authorizes the use of his car has zero per cent liability, surely an owner finance company – or here, an owner leasing company – can have no more fault by virtue of having less control than the car’s actual owner.

The Justice rejected the Plaintiff’s attempts to distinguish the McIver authority on the basis that it did not involve a leasing or rental agreement:

[18]           Barz says McIver is distinguishable as being a case not involving a leasing or rental agreement but rather a private owner leaving his vehicle with a repair garage.

[19]           While of course decided on somewhat different facts, I do not agree that McIver is distinguishable. The McIver court’s comments at paras 62-67 in particular are of general application. The court said clearly that s 187 of the TSA is not frustrated when a trier of fact determines a party has zero per cent actual vicarious liability as between two or more vicariously-liable parties. As noted at para 64:

[64] Even though the purpose of s 187 of the TSA is to enable plaintiffs injured in motor vehicle accidents to “more readily recover damages”, it does not follow that this purpose is frustrated if injured plaintiffs obtain compensation from another source. Nothing in s 187 of the TSA expresses a preference for compensating loss caused by the consensual use of a vehicle through an action against the vicariously liable vehicle owner rather than some other mode of compensation. Where, as here, the Workers’ Compensation scheme provides compensation to the injured plaintiff, the objective of s 187 of the TSA – that plaintiffs injured by the consensual but negligent use of a vehicle are compensated – is satisfied.

The Justice also confirmed that the Dempsey v Bagley (2016 ABQB 124) decision, which apportioned liability to a leasing company, was supplanted by the McIver decision.

[24]           The recent decision of the Master in Manak again deals with a number of parties immune from suit owing to WCA provisions, and one – Maxim Transportation Services Inc – facing vicarious liability for its own fault. At issue was a lease materially indistinguishable from the lease or rental agreements in the cases of Paccar and Barz. Likewise, in Manak the owner Maxim Transportation had no interaction, control or supervision with the leased vehicle’s driver. While the lease enabled Maxim to assert control over the vehicle in question, the unchallenged evidence was that it was not aware of any reason or occasion to do so. The Master concluded that, as in McIver, there was no evidence in Manak that Maxim could have done anything differently to ensure the safe and lawful operation of the vehicle in question:

On the facts here, it was not within Maxim’s power to prevent the accident, nor is there any evidence that the scope or exercise of Maxim’s control contributed to Mr. Manak’s loss. I decline to apportion any of his damages to Maxim. (Endorsement, at para 44)

[25]           In answer to Mr. Manak’s reliance on Dempsey, the Master pointed out the acknowledgement of some vicarious liability in that case, and the comment in McIver that a finding of fact of zero per cent vicarious liability does not frustrate the purpose of the TSA.

[26]           The court in Manak relied on McIver, at paras 64-67, to conclude that assigning no liability to a vicariously-liable owner under s 23(2) of the WCA does not frustrate s 187 of the TSA.

Accordingly, the Justice determined the Master’s decision dismissing the claim against The Driving Force was correct, and dismissed the appeal.