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New Decision redefines definition of “Occupant”

By Brian C. Atherton

Atherton Barristers

In McIntyre v. Scott , the Court of Appeal has determined that an occupant of a motorcycle need not actually be on the motorcycle at the time of the accident for there to be coverage.

The facts of the case are rather straightforward. The plaintiff was a rear-seat passenger on her husband’s motorcycle, being operated by him on the date of loss. Due to a rainstorm they sought shelter under an overpass. The driver of the motorcycle parked the bike and both parties got off of it. The plaintiff was returning to the motorcycle to retrieve an object from a saddlebag when she and her husband were struck by an uninsured driver. Her husband was killed and the plaintiff was seriously injured.

The issue became a question of coverage i.e. which the two policies in the family would respond.

Jevco insured the motorcycle and Pilot insured another vehicle in the family.

The motions Judge at first instance determined that the plaintiff was not an occupant within the plain meaning of Section 224(1) and relied upon the decision of the Court of Appeal in AXA v. Markel . In particularly he found that she was not physically “in or on” the motorcycle at the time of the accident. He further noted that the definition of passenger contained the phrase “whether being carried in or on the automobile”. He felt that these words were sufficient to import a physical connection between the “passenger” and the automobile before the person can be deemed “an occupant”.

The Court of Appeal disagreed and relied upon the decision of Kyriazis v. Royal Insurance Company . In Kyriazis the plaintiff stopped her vehicle and had gotten out of it to clear snow from her windshield. The Court of Appeal held that she was still the “driver” of the vehicle notwithstanding the fact that they are not engaged in the physical activity of driving. In AXA , the plaintiff had gotten out of his truck and was standing in a loading bay 30 feet from his vehicle. A piece of wood from another vehicle flew off and struck him. The Court of Appeal found him to be a driver for the purposes of Section 224(1). In AXA the Court looked to the “importance placed on the status of the person in the current act” which was under the description of a person claiming benefits. Because the Act did not define an individual in terms of the activity being engaged in or their location, the Court felt that the status of an individual as a “driver” does not permanently attach to a person but depends on the circumstances at the time. The question is would an objective individual determine if the person was actually the driver of the vehicle.

The Court of Appeal in McIntyre disagreed somewhat with the interpretation in AXA and felt that a more liberal interpretation of the definition should be required. It is further noted that the Court of Appeal went beyond the facts of this case and felt that there would be other circumstances where individuals may have to resort to the Motor Vehicle Accident Claims Fund if a more liberal definition was not involved.

Therefore the Court did rely upon AXA and the “objective observer” approach, to determine that she would be a passenger of the motorcycle at the time of the accident. Accordingly, it was found that the coverage should be under the Jevco policy as it insured the motorcycle.

Frankly, the Court of Appeal’s decisions seems not in keeping with the most recent trend, which has been to interpret the language of Bill 59 in a more conservative fashion. The analysis by the Court of Appeal is more in keeping with the approach adopted under the previous legislation, which led to a significant increase in claims, and exposures for the insurance industry. While an argument can certainly be made to support the Court of Appeal’s decision, it has open the door to how far one will take the “objective observer” approach. Hopefully further cases will come forward, which will be addressed by a different panel of the Court, which might place a more “common sense” interpretation on the Regulations.

Please contact me if you have any further questions regarding this case or any other matter.