ONCA Rejects BC Motor Vehicle Accident Claim

A five-member panel of the Court of Appeal for Ontario has released a new decision dealing with out-of-province accidents and conflict of laws issues.

In Forsythe v. Westfall, the claimant appellant was an Ontario resident who was insured under an Ontario auto policy with Axa Insurance Company. She was a passenger on a motorcycle owned and operated by the respondent Westfall, an Alberta resident, when that vehicle was involved in a single vehicle accident in British Columbia on August 11, 2012. Westfall claimed the accident was caused solely by an unidentified driver.

Forsythe sustained injuries and issued a tort action in Ontario against Westfall, his insured Jevco, her insurer Axa (unidentified coverage), and the John Doe unidentified driver.

Westfall moved to have the action against him stayed on the basis that the Ontario court lacked jurisdiction over him. The motion judge agreed with Westfall’s position on the basis that there was no real and substantial connection between the matter, the parties, and Ontario. He followed the Court of Appeal’s decision in Tamminga v. Tamminga (2014), and held that the appellant’s Ontario automobile insurance policy was not a factor that satisfied the real and substantial connection test.

Forsythe appealed that decision to the Court of Appeal. Her argument at its heart was that the Tamminga decision was wrongly decided and should be overturned. For this reason, the appeal was heard by a five-judge panel.

Real and Substantial Connection and The Tamminga Decision

In Club Resorts Ltd. v. Van Breda (2012), the Supreme Court of Canada confirmed that the test for establishing jurisdiction is whether there is a real and substantial connection between the subject matter of the litigation to the forum. The Court provided a list of non-exhaustive presumptive connecting factors that would allow a court to assume jurisdiction over a tort dispute:

• the defendant is domiciled or resident in the province;
• the defendant carries on business in the province;
• the tort was committed in the province; and
• a contract connected with the dispute was made in the province.

Taminga involved an Ontario resident who was injured when she fell off a truck in Alberta. She commenced an action in the Ontario Superior Court against the owner and operator of the truck, who lived in Alberta, and a corporate co-owner of the truck, which was registered and carried on business in Alberta. She also sued her Ontario automobile insurer. The issue was whether her insurance contract was a sufficient “presumptive connecting factor” under the Supreme Court of Canada’s decision in Van Breda to give the Ontario court jurisdiction over the non-resident defendants. The Court of Appeal held that the Ontario insurance contact was not a presumptive factor.

Forsythe Challenges Tamminga

Forsythe argued that the her automobile insurance policy was a “contract connected with the dispute” that was made in Ontario. She argued that it gave Ontario courts jurisdiction over part of the dispute because it required her to sue her own insurer in Ontario. Moreover, section 4 (1) of Ontario Regulation 676 compelled her to sue her insurer in Ontario:

4. (1) The determination as to whether the person insured under the contract is legally entitled to recover damages and, if so entitled, the amount thereof shall be determined,
…

(c)     by a court of competent jurisdiction in Ontario in an action brought against the insurer by the person insured under the contract, and unless the determination has been previously made in a contested action by a court of competent jurisdiction in Ontario, the insurer may include in its defence the determination of liability and the amount thereof.

The Court of Appeal disagreed, finding among other things that a plaintiff could sue the tort defendant(s) in another jurisdiction while suing her insurer at home. There was no need for the plaintiff to join the extra-provincial defendants in her action against her own insurer.

The Court of Appeal Refuses to Create a New Presumptive Connecting Factor

The appellant and the intervener (Ontario Trial Lawyers Association) also argued that if none of the four presumptive connecting factors set out in Van Breda were satisfied, the Court of Appeal should recognize a new presumptive connecting factor. They claimed this factor should be based on the appellant’s insurance contract, the regulatory requirement, the fact that she resided in Ontario, that she sustained damages in Ontario, and that she was required to bring suit in two jurisdictions, which may give rise to inconsistent verdicts. They submitted that recognizing a new presumptive connecting factor in the circumstances would be consistent with the values of order, fairness, efficiency, and comity.

The Court of Appeal refused to do so, finding that those arguments were irrelevant for the purpose of deciding jurisdiction. The Court acknowledged that those factors might be appropriate if deciding whether Ontario was the more appropriate forum to hear the matter.

The Court of Appeal Refuses to Find Ontario to be the Necessary Forum

The appellant also argued that an Ontario court should assume jurisdiction on the basis of the forum of necessity doctrine. That doctrine is available in extraordinary and exceptional circumstances. For Ontario to accept jurisdiction as the “forum of necessity”, the appellant must establish that there is no other forum in which she can reasonably seek relief.

The Court of Appeal rejected this argument, noting that the plaintiff was still pursuing a tort claim in British Columbia and was still able to pursue her insurer in Ontario. There was no chance that the plaintiff would be denied access to justice if the doctrine was not applied.

Final Remarks

In the wake of Van Breda, this case provides another example of an Ontario court refusing to accept jurisdiction of a tort action arising from an out-of-province accident. It is now all but settled law that having an Ontario insurance policy is not enough of a presumptive connecting factor to create a real and substantial connection to Ontario.

See Forsythe v. Westfall, 2015 ONCA 810