A Premier

Toronto Law Firm

serving all of Canada and International clients since 1996.
 
Telephone:
416-203-9500
 


Newsletters 2012 > March 2012

In this issue:
1. Firm and Industry News
2. Update on Motions For Summary Judgment
3. Port Authority Fees
4. Cargo Damage Not Covered by Auto Policy
5. Halsbury's Laws of Canada - Transportation

 

1. Firm and Industry News

  • April 19 - 22, 2012, London U.K.: McGill University / PEOPIL Conference on Aviation Law and Insurance
  • April 25 - 29, 2012, New Delhi, India: Workshop & International Conference on Law & Regulation of Air Transport & Law of Space Applications
  • May 8 - 9, 2012, Toronto: Supply Chain & Logistics Association of Canada Annual Conference
  • May 23 & 24, 2012, Banff Springs: Semi-Annual Meeting Canadian Board of Marine Underwriters

Gordon Hearn will be moderating a Webinar on April 4th being produced by the Transportation Lawyers Association. The panel presentation deals with Insurance Issues Pertaining to Trucking Casualty and Cargo claims.

Gordon Hearn will be presenting a paper on the "Canadian Import and Export Regulatory Regime" at the April 23rd annual meeting of the Transportation & Logistics Council in Orlando, Florida.

Gordon Hearn will be presenting a paper on "Legal Considerations in Managing Export Trade Risks" at an industry conference on April 26th in Mississauga, Ontario.

Halsbury's Laws of Canada has just published its Transportation - Carriage of Goods and its Transportation - Railways titles in one text. Rui Fernandes is the author for both of these works. See the summary of the works below in item 7.


 

2. Motions for Summary Judgment: What's Up? (A Review of Events and Developments since the January 1, 2010 Amendments to Rule 20)

The Ontario Court of Appeal recently released its decision in Combined Air Mechanical Services Inc. v. Flesch. (*1) This decision revisits the purpose and availability of the 'summary judgment' mechanism in our court system. This case lists the guiding principles to be applied by a court in deciding whether to award summary judgment in favour of a party to a lawsuit. It follows that the principles cited below must be considered in the context of any litigation strategy: does the matter warrant proceeding all the way to trial?

Litigation is expensive. It drains resources. It is important for a party to a lawsuit to assess the viability of determining a dispute earlier than later by way of a motion for summary judgment. This is particularly the case when the discovery process is completed and a factual 'record' has taken shape.

To put the new list of guiding principles in context, it is helpful to first review what our system has for some time now contemplated in terms of 'summary judgment'. It will then be important to consider how the court rules governing this process have evolved with a view to even more aggressively trying to 'weed out' those cases that should be disposed of without a trial from those that should proceed to the formal trial process. This article finishes with a summary of the governing factors recently listed by the Court of Appeal as to when summary judgment should be awarded.

Background - A Brief History of the Summary Judgment Mechanism (rule 20).

Before January 1, 2010, the relevant mechanism [Rule 20] provided that:

20.01(1) A plaintiff may, after the defendant has delivered a statement of defence or served a notice of motion, move with supporting affidavit material or other evidence for summary judgment on all or part of a claim in the statement of claim.

(3) A defendant may, after delivering a statement of defence, move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim.

20.04(1) In response to affidavit material or other evidence supporting a motion for summary judgment, a responding party may not rest on the mere allegations or denials of the party's pleadings, but must set out, in affidavit material or other evidence, specific facts showing that there is a genuine issue for trial.

(2) The court shall grant summary judgment if,

a) the court is satisfied that there is no genuine issue for trial with respect to a claim or a defence; or

b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.

Under this former Rule 20, a motion for summary judgment was heard entirely on the basis of the 'paper record', typically consisting of affidavits sworn by witnesses, transcripts of cross-examinations (if conducted) on the affidavits filed, and (if the parties chose to refer to them) any transcripts taken from examinations for discovery in the action. Based on these materials, the court was required to determine if there was a 'genuine issue' for trial respecting a claim or a defence. If there court determined that there was no genuine issue for trial then summary judgment was to be awarded, with the action either being allowed or dismissed without the need for a formal trial with evidence from 'live' witnesses.

The meaning of a 'genuine issue for trial' had been defined as follows:

It is safe to say that "genuine" means not spurious and, more specifically, that the words "for trial" assist in showing the meaning of that term. If the evidence on a motion for summary judgment satisfies the court that there is no issue of fact which requires a trial for its resolution, the requirements of the rule have been met. It must be clear that a trial is unnecessary. The burden is on the moving party to satisfy the court that the requirements of the rule have been met. Further, it is important to keep in mind that the court's function is not to resolve an issue of fact but to determine if a genuine issue of fact exists. (*2)

The purpose of summary judgment had been explained as follows:

A litigant's "day in court", in the sense of a trial, may have traditionally been regarded as the essence of procedural justice and its deprivation the mark of procedural injustice. There can, however, be proceedings in which, because they do not involve any genuine issue which requires a trial, the holding of a trial is unnecessary and, accordingly, represents a failure of procedural justice. In such proceedings the successful party has been both unnecessarily delayed in the obtaining of substantive justice and been obliged to incur added expense. Rule 20 exists as a mechanism for avoiding these failures of procedural justice. (*3)

What, however, was to be done where there was a dispute on a point of evidence or where something in controversy was presented to the court on a point of fact? Could the judge hearing the application for summary judgment actually assess the quality of the evidence being heard - or would the matter have to wait for a formal trial with all of its trimmings including witnesses evidence during 'examination in chief' and being exposed to 'cross examination' for a 'trier of fact' to come to a 'finding'?

Various court decisions followed, confirming that judges were restricted in their analyses when considering applications for summary judgment. To cite one passage from Mr. Justice Borins:

In ruling on a motion for summary judgment, the court will never assess credibility, weigh the evidence, or find the facts. Instead, the court's role is narrowly limited to assessing the threshold issue of whether a genuine issue exists as to material facts requiring a trial. Evaluating credibility, weighing evidence, and drawing factual inferences are all functions reserved for the trier of fact. (*4)

Mr. Justice Borins further articulated the restriction placed on the availability of summary judgment as follows:

However, in my respectful view, in determining this issue (of the necessity of a trial) it is necessary that motions judges not lose sight of their narrow role, not assume the role of a trial judge and, before granting summary judgment, be satisfied that it is clear that a trial is unnecessary.

At the end of the day, it is clear that the courts accord significant deference to the trial process as the final arbiter of the dispute which has brought the parties to litigation. If there is a genuine issue with respect to material facts then, no matter how weak, or how strong, may appear the claim, or the defence, which has been attacked by the moving party, the case must be sent to trial. It is not for the motions judge to resolve the issue. (*5)

The Changes to Rule 20 in 2010

In June 2006 the Ontario Government commissioned a study and recommendations to make the civil justice system in Ontario more accessible and affordable. The resulting report - the Osborne Report (the "Report") - noted the strict limits mentioned above that the case law placed on a judge's power to assess the quality and cogency of the evidence when determining the 'genuine issue for trial' question. The Report noted that that such restrictions tended to undermine the utility of Rule 20 by deterring litigants from bringing motions under this Rule to summarily resolve disputes.

In light of the Osborne Report, Rule 20 was amended effective January 1, 2010. The important highlights of the new Rule are as follows:

20.04(2) The court shall grant summary judgment if,

a) the court is satisfied that there is no genuine issue requiring a trial with respect to a claim or a defence; or
b) the parties agree to have all or part of the claim determined by a summary judgment and the court is satisfied that it is appropriate to grant summary judgment.

(2.1) In determining under clause (2)(a) whether there is a genuine issue requiring a trial, the court shall consider the evidence submitted by the parties and, if the determination is being made by a judge, the judge may exercise any of the following powers for the purpose, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence.

(2.2) A judge may, for the purposes of exercising any of the powers set out in sub-rule (2.1), order that oral evidence be presented by one or more parties, with or without time limits on its presentation.

This certainly presents a sea change from the old rule. While the intent is not to allow a judge to turn a motion for summary judgment into a 'mini-trial' - it is now clear that a mechanism exists for a judge to use such tools to take a hard look into whether there is indeed a genuine issue for trial.

Developments Since the January 1, 2010: Amendments to Rule 20

In the months following the amendments to Rule 20, it has become a matter of some controversy and uncertainty as to whether it is appropriate for a motion judge to use the new powers conferred by the amended Rule 20 to decide an action on the basis of the evidence presented on a motion for summary judgment. Judges of the Ontario Superior Court of Justice have expressed differing views on this and other interpretive issues raised by the amendments. As a result, both the bench and the bar turned to the Court of Appeal for clarification on what the amended rule does and does not accomplish. To provide some guidance to the profession, the Court of Appeal convened a five-judge panel to hear five appeals from decisions under the amended rule. (*6)

The Combined Air case before the Ontario Court of Appeal

The Combined Air decision involved the Court of Appeal assessing the outcome of motions for summary judgment in five different lawsuits, all brought in first instance before judges of the Ontario Superior Court. This brought into stark relief the issues concerning the interpretation of the new Rule 20, including the nature of the test for determining whether or not summary judgment should be granted, the scope and purpose of the new powers that have been given to judges hearing motions for summary judgment, and the types of cases that are amenable to summary judgment. In its ruling, the Court of Appeal pronounced 'go-forward' general principles to be followed in the application of the amended Rule 20. In fact, the Court of Appeal has characterized the statement of governing principles pronounced by it in Combined Air as "a new departure and a fresh approach to the interpretation and application of the amended Rule 20".

The New Guiding Principles

As articulated by the Court of Appeal:

1. The motion judge may now weigh the evidence, evaluate the credibility of a deponent, and draw any reasonable inference from the evidence in determining whether there is a genuine issue requiring a trial with respect to a claim or a defence (Rule 20.04(2.1)).

2. The new rule also enables the motion judge to direct the introduction of oral evidence to further assist the judge in exercising these powers: Rule 20.04(2.2).

3. The purpose of the new rule is to eliminate unnecessary trials, but not all trials. The guiding consideration is whether the summary judgment process, in the circumstances of a given case, will provide an appropriate means for effecting a fair and just resolution of the dispute before the court.

4. Generally speaking, there are three types of cases that are amenable to summary judgment. The first is where the parties agree to submit their dispute to resolution by way of summary judgment. The second type of case encompasses those claims or defences that are shown to be without merit. The third type of case concerns situations where a case can be disposed of on its merits where the trial process is not required in the "interest of justice".

5. In deciding whether the new powers under 20.04(2.1) should be employed to weed out a claim as having no chance of success or be used to resolve all or part of an action, the motion judge must ask the following critical question: can the full appreciation of the evidence and the issues that is required to make dispositive findings be achieved by way of summary judgment, or can this full appreciation only by achieved by way of a trial? In cases that call for multiple findings of fact on the basis of emanating from a number of witnesses and found in voluminous record, a summary judgment motion cannot serve as an adequate substitute for the trial process. Generally speaking, in these cases, the motion judge simply cannot achieve the full appreciation of the evidence and issues that is required to make dispositive findings. Accordingly, the full appreciation test is not met and the "interest of justice" requires a trial. (*7)

6. In contrast, in document-driven cases with limited testimonial evidence, a motion judge would be able to achieve the full appreciation of the evidence and the issues that is required to make dispositive findings. Similarly, the full appreciation test may be met in cases with limited contentious factual issues. The full appreciation test may also be met in cases where the record can be supplemented to the requisite degree at the motion judge's direction by hearing oral evidence on discrete issues. (*8)

7. The real point being driven home by the Court of Appeal is as follows: A motion judge is required to assess whether the attributes of the trial process are necessary to enable him or her to fully appreciate the evidence and the issues posed by the case. In making this determination, the motion judge is to consider, for example, whether he or she can accurately weigh and draw inferences from the evidence without the benefit of the trial narrative, without the ability to hear the witnesses speak in their own words, and without the assistance of counsel as the judge examines the record in chambers.

8. While revisiting matters and adopting the "full appreciation test', the Court of Appeal has reconfirmed the historical evidentiary obligation as still existing on each party to a motion for summary judgment: each side must put their 'best foot forward' with respect to the existence or non-existence of material issues to be tried". On a motion for summary judgment, a party is not "entitled to sit back and rely on the possibility that more favourable facts may develop at trial".

9. The Court of Appeal has noted that it will not be in the 'interest of justice' to exercise any of the Rule 20.04(2.1) powers in cases where the nature and complexity of the issues demand that the normal process of production of documents and oral discovery be completed before a party is required to respond to a summary judgment motion. In such a case, forcing a responding party to build a record through affidavits and cross-examinations will only anticipate and replicate what should happen in a more orderly and efficient way through the usual discovery process.

Gordon Hearn

End Notes

*1 Combined Air Mechanical Services Inc. v. Flesch (2011) O.J. No. 5431 (Ont. C.A.)
*2 Irving Ungerman Ltd. v. Galanis (1991) 4 O.R. (3d) 545 (C.A.) at p. 551
*3 Ibid, at p. 550-551
*4 Aguonie v. Galion Solid Waste Material Inc. (1998) 38 O.R. (3d) 161 at p. 163
*5 Dawson v. Rexcraft Storage and Warehouse Inc. (1998) 164 D.L.R. (4th) 257 (Ont. C.A.) at paras. 20 and 28
*6 Hence, the decision in the Combined Air case, supra. This discussion and the purpose for the ruling is addressed at paragraphs 5 and following in the Court's decision.
*7 Ibid, at paras. 50 - 51
*8 ibid, at para. 52



3. Federal Court Confirms Ability of Port Authorities to Charge Fees to Ship-Owners Based on Volume of Containerized Cargo Imported / Exported

The recent decision Shipping Federation of Canada v. Vancouver Fraser Port Authority, 2012 FC 301 (CanLII) involved the judicial review by the Federal Court of Canada of a fee schedule whereunder the Vancouver Fraser Port Authority imposed a fee on ship-owners in respect of the volume of containerized cargo imported or exported through the port.

Based on an analysis of the source of the port's legal authority to impose such fees (the Canada Marine Act, S.C. 1998 C.10), the Court concluded that the fees were legal in the circumstances and dismissed the application.

Background

The Vancouver Fraser Port Authority ("VFPA"), doing business as Port Metro Vancouver, is a non-shareholder, financially self-sufficient corporation, established by the Government of Canada in January 2008, pursuant to the Canada Marine Act and is accountable to the federal Minister of Transport. It is Canada's largest and busiest port and, of note, it is the fourth largest port (by tonnage) in North America. (*1)

The VFPA is part of the Asia-Pacific Gateway and Corridor (the "Gateway Project"), a network of transportation infrastructure that includes the ports of the Lower Mainland and the principal road and rail connections across Western Canada. The Gateway Project was launched in October 2006 and, as a result, the Federal Government commissioned a series of infrastructure projects to be undertaken in the Lower Mainland area to improve the reliability of the Gateway Project for Canadian exports and to increase the region's share of container imports from Asia. (*2)

With regard to said improvements, seventeen projects in three major areas that are under the control of the VFPA were improved under the Gateway Project and, as a result, the VFPA committed substantial sums to be repaid through the implementation of a new fee known as the Gateway Infrastructure Fee ("GIF"). VFPA's authority to fix fees is pursuant to s. 49 of the Canada Marine Act:

49. (1) A port authority may fix fees to be paid in respect of

(a) ships, vehicles, aircraft and persons coming into or using the port;

(b) goods loaded on ships, unloaded from ships or trans-shipped by water within the limits of the port or moved across the port; and

(c) any service provided by the port authority, or any right or privilege conferred by it, in respect of the port.

[…]

(3) The fees fixed by a port authority shall be at a level that permits it to operate on a self-sustaining financial basis and shall be fair and reasonable [emphasis added].

Under VFPA's fee scheme, the GIF is payable in respect of containerized cargo by the owner of the vessel on volumes imported or exported over the wharf and in respect of non-containerized cargo, by the owner of the cargo based on tonnage loaded or unloaded over the wharf. (*3) The fee scheme was set out in a letter of March 10, 2011 and is what the Applicants style as the "decision" for the purposes of their application for judicial review.

The Application for Judicial Review

Judicial review is the process whereby an applicant asks the Court to review an administrative decision made by a person or entity pursuant to legislative authority.

The applicants, twelve international shipping lines calling at VFPA's port and their trade association, the Shipping Federation of Canada, objected to the VFPA's decision to assess the GIF in respect of containerized shipments against the owner (which includes the charterer) of the respective vessels. (*4) Note that, for the purposes of the application, the applicants did not contest the GIF as it applied to non-containerized cargo.

The Applicants contended that "the ship owners did not receive any benefit from the Gateway Projects nor do they receive any service or services in respect of the GIF." (*5) On this basis, the Applicants argued that the GIF was not "fair and reasonable" as required by s. 49(3) of the Canada Marine Act, and that it was a "tax" rather than a user fee or regulatory fee. (*6) Based on the limited grant of authority to impose fees established by s. 49 of the Canada Marine Act, the imposition of a "tax" would be beyond the ambit of VFPA's jurisdiction and therefore without legal enforceability.

In practical terms, the Court summed up the applicants' complaint as follows: (*7)

[T]he charging mechanism on containers imposes an undue administrative burden and costs which cannot easily be passed on to the container owners or to the owners of the goods who presumably receive some benefit from improved Gateway infrastructure in terms of the efficiency of port container handling and ultimate delivery to destinations.

In essence, the applicants complaint was of a business nature in that the fees were causing the ship-owner or charterer to expend funds in connection with the GIF that were not easily recoverable from customers.

As the Applicants framed their issues as being "jurisdictional", i.e. the assertion that VFPA acted without jurisdiction, the standard of review was that of "correctness," most recently confirmed by the Supreme Court of Canada in Dunsmuir v. New Brunswick, 2008 SCC 8 (CanLII) as: (*8)

When applying the correctness standard, a reviewing court will not show deference to the decision maker's reasoning process; it will rather undertake its own analysis of the question. The analysis will bring the court to decide whether it agrees with the determination of the decision maker; if not, the court will substitute its own view and provide the correct answer. From the outset, the court must ask whether the tribunal's decision was correct.

In short, was the "decision" (in this case being VFPA's fee scheme) correct in light of the VFPA's legislative authority?

Issue 1: Is the GIF "Fair and Reasonable"?

The first issue considered by the Court was whether the GIF was "fair and reasonable" as mandated by s. 49(3) of the Canada Marine Act.

Considering the substance of the GIF, the Court looked to the definition of "Fees" contained in the Act:

"fees" includes harbour dues, berthage and wharfage, as well as duties, tolls, rates and other charges, but does not include payments made under a lease or licence agreement [Emphasis Added].

Without much ado, Court found that the GIF would fall within the category of "other charges." The applicants, however, relying on administrative decisions made in the context of the Pilotage Act, R.S.C. 1985, c. P-14, argued that, in order for the fees to be "fair and reasonable," that "there must be a direct link between the fee charged and either a service provided or a benefit received." (*9)

The Court found that the applicants' reliance on decisions decided under the Pilotage Act to be "misplaced" as the Canada Marine Act is differently constituted and, with that, the Court embarked on a discussion of the relevant provisions therein. Specifically, the Court looked at the language in s. 49, which expressly permits a port to fix fees in respect of:

(a) ships, vehicles, aircraft and persons coming into or using the port;

(b) goods loaded on ships, unloaded from ships or trans-shipped by water within the limits of the port or moved across the port; and

(c) any service provided by the port authority, or any right or privilege conferred by it, in respect of the port [emphasis added].

Without going beyond the face of the statute, the Court concluded that the GIF was valid against container ship owners and ruled that: (*10)

The decision to levy the fee against the ship owner is reasonable as the ship is the primary contact with the port. The ease of collecting the fee from the ship owner versus assessing the fee against each owner of each piece of cargo in the container or against each container owner is obvious. In any event, such a decision is within the operation of the VFPA home statute and Letters Patent[.]

Further, the Court dismissed the applicant's argument that the VFPA needed to link the GIF to a benefit in order to justify the ship-owners having to pay and, as an extra jab, the Court remarked that even if a direct link were required, such a link was present in the circumstances as ship-owners benefit from a more efficient port where cargo can be released more quickly and, as a result, ships are freed to provide more voyages. (*11)

Issue 2: "Tax" versus "Fee"

Going on to consider whether the GIF was a tax or a fee, the Court considered the applicants' argument that the GIF was a "disguised tax" on the basis that it was: (*12)

imposed for a broader, more public, purpose to encourage the growth of the Asia-Pacific Gateway and Corridor through better use of capacity. Insofar as the VFPA is concerned, it was investing in infrastructure "beyond traditional port activities and lands."

In consideration of this argument, the Court turned to one of its previous decisions, Algoma Central Corp v. Canada, 2009 FC 1287 (CanLII), wherein the Court discussed the distinction between a harbour fee and a tax. Therein, Justice O'Keefe determined: (*13)

  • the regulation of public ports under the Canada Marine Act constitutes a national system which is clearly a regulatory scheme.
  • the users of those public ports and the surrounding waters benefit from the regulation of public ports.
  • to be a regulatory fee, a harbour fee need not be specifically traceable to specific regulatory costs - it is sufficient if the revenues obtained were less than the money expended on the regulatory system.

Applying the above principles to the facts, the Court found that (a) "the regulation and operation of port authorities constitutes part of a national scheme for the self-sufficient, independent but interrelated operations of ports in Canada;" (b) "users of the port authority's ports and surrounding waters benefit from the regulation of these ports;" and (c) the VFPA, through the GIF, will only recover 90% of the amount expended on the projects, which is less than the money expanded on the system. On these bases, the Court found that the GIF was not a tax. (*14)

In these times of austerity and highly-competitive shipping markets, ship-owners will have to determine how to efficiently transfer these fees to their customers as this decision suggests that these types of fees appear to be here to stay.

James Lea

Endnotes:

*1 Port Metro Vancouver website: www.portvancouver.com/.
*2 Shipping Federation of Canada v. Vancouver Fraser Port Authority, 2012 FC 301 (CanLII) ("Shipping Federation") at paras. 4-5.
*3 Ibid, at para. 8.
*4 Ibid, at para. 9.
*5 Ibid, at para. 10.
*6 Ibid.
*7 Ibid, at para. 12.
*8 Dunsmuir v. New Brunswick, 2008 SCC 8 (CanLII) at para. 50.
*9 Shipping Federation, at para. 23.
*10 Ibid, at para. 35.
*11 Ibid, at paras. 31-32.
*12 Ibid, at para. 38.
*13 Ibid, at para. 40.
*14 Ibid, at paras. 42-44.


 

4. Cargo Damage Not Covered by Auto Policy

The recent decision of Siena-Foods Limited v. Old Republic Insurance Company of Canada, 2011 ONSC 7250 (CanLII) confirms that an automobile policy in Ontario does not provide certain coverage for cargo damage.

The plaintiff rented a refrigerated transport truck (the "truck") and 26-foot cab/trailer from Ryder Canada. At that time, the plaintiff purchased automobile insurance through the rental agreement from the defendant Old Republic Insurance Company of Canada. The insurance coverage was set out in the terms and conditions of the rental agreement between the plaintiff and Ryder Canada.

The plaintiff's employee was using the truck to transport a Dixie DV 2000, a food packaging machine used in the plaintiff's business to vacuum seal its product as part of its food packaging process. The employee was driving the truck southbound on Brock Road in Durham, Ontario. A Pontiac motor vehicle, that had been proceeding northbound on Brock Road, crossed the centre lane and entered the southbound lane, colliding head on with the truck. The plaintiff alleges that the collision caused serious damage to the plaintiff's equipment contained in the truck.

The plaintiff alleged that, pursuant to Subsection 263 of the Insurance Act, it was entitled to coverage for the damaged equipment from its automobile insurer, Old Republic Insurance Company of Canada.

Subsection 263(1) of the Insurance Act provides that section 263 applies if an automobile or its contents or both suffer damage arising directly or indirectly from the use or operation in Ontario of one or more other automobiles and the damaged automobile and one other automobile involved in the accident are insured under a contract evidenced by a motor vehicle policy by an insurer licensed in Ontario.

If the conditions in subsection 263(1) of the Insurance Act are met, subsection 263(2) provides that an insured is entitled to recover for the damages to its automobile and its contents from the insured's insurer under the coverage described in subsection 239(1), as though the insured were a third party.

The relevant provisions of subsection 247(b) of the Insurance Act state that the insurer may provide under a contract evidenced by a motor vehicle liability policy that it shall not be liable for loss of or damage to property carried in or upon the automobile or to any property owned or rented by or in the care, custody or control of the insured.

The court found that section 5.A of the rental agreement between the plaintiff and Ryder Canada precluded insurance coverage for loss and/or damage to the property owned by the plaintiff, which was carried in the Ryder rental truck, and under the care, custody or control of the plaintiff: "there is liability protection against bodily injury or property damage claimed by others; and if elected, the liability protection plan (which the plaintiff obtained) and supplemental liability protection plan (which was not elected by the plaintiff) do not apply if the rented vehicle was obtained, used or operated in violation of any provision of the rental agreement and/or to loss or damage to property owned by the plaintiff, in the vehicle, or for any reason, in the plaintiff's care, custody or control." (paragraph 15)

The court concluded that Old Republic expressly excluded coverage for damage to property belonging to or in the possession of the plaintiff in the rented truck, in accordance with the provisions of subsection 247(b) of the Insurance Act. As a result, subsection 263(2) of the Insurance Act has no application to this case with respect to the property damage claimed by the plaintiff and cannot be interpreted in the circumstances of the present case to provide coverage to the plaintiff where no coverage existed under the Old Republic policy.

The court also found that the terms and conditions contained in the rental agreement between the plaintiff and Ryder Canada precluded the plaintiff from any entitlement because the plaintiff materially misrepresented (whether innocently or otherwise) the cargo contents of the rented truck in violation of the rental agreement.

"There is no question that Ryder Canada was led to believe by the plaintiff that the plaintiff was transporting produce in the rented truck: on the face of the rental agreement, the plaintiff identified that the "cargo contents" were produce; and consistent with the transportation of produce, the truck was a refrigerated truck and a refrigerated truck rate was charged. There is no dispute that the information provided regarding the goods to be transported was incorrect in that the plaintiff was carrying in the rented truck its Dixie DV 2000 and not produce as represented. At no time did the plaintiff advise Ryder Canada that it was transporting a large piece of equipment." (paragraph 21).

As a result, the court concluded that the Old Republic insurance policy did not provide coverage for the plaintiff's alleged property damage and that, in any event, the plaintiff was precluded by the terms of the rental agreement and the insurance policy, and its material misrepresentation of the cargo contents, from recovering any damages from Old Republic for loss of the plaintiff's equipment.

Rui Fernandes

 

 

5. Halsbury's Laws of Canada - Transportation Law

Transportation - Carriage of Goods
Rui M. Fernandes, B.Sc., J.D., LL.M.

With carriage of goods law often at the forefront of commercial transactions, Halsbury's Transportation - Carriage of Goods title offers the ideal resource for lawyers who require a concise explanation of how this specialized area of law operates.[1] Timely and accessible, and written by one of Canada's leading transportation lawyers, this valuable reference delivers a clear narrative of the legislative framework and identifies the relevant case law that practitioners need to be aware of. It contains useful answers to questions on a wide range of topics, including:

  • Federal and provincial powers and areas of responsibility
  • Carriage of goods by road
    • Federal legislation regulating extra-provincial trucking
    • Provincial licensing of carriers
    • Powers and procedures of transport authorities
    • Equipment and personnel
    • Duties and responsibilities of carriers
    • Passenger and luggage liability issues
    • Hazardous goods
  • Carriage of goods by rail
    • Contractual arrangements
    • Loss, damage or delay
    • Accommodation for goods
    • Connecting carriers
  • Carriage of goods by water
    • Formation and interpretation of Charter parties
    • Loading and discharge of goods
    • Frustration of contracts
    • Hague-Visby rules regarding bills of lading
    • Responsibilities, liabilities, rights and immunities of carrier
      Arbitration clauses, letters of indemnity

Transportation - Railways
Rui M. Fernandes, B.Sc., J.D., LL.M.

Once at the very heart of commercial activity and the Canadian Dream, railways still play an important part in the transport of passengers and goods, and rail lines are omnipresent in virtually every populated region in Canada. Transportation - Railways provides a comprehensive and national treatment of the law governing the construction, operation, safety and oversight of federal and provincial railways, including matters such as:

  • The legislative framework
  • Role and powers of the Canadian Transportation Agency
    • Orders, enforcement and appeals
    • Mediation and arbitration
    • Violations and offences under the legislation
  • Regulation of railway construction
    • Expropriation of land
    • Location, re-location and approval procedures
    • Construction and maintenance costs
  • Safety standards and regulation
    • Duty of care, rights of way and railway crossings
    • Environmental protection
    • Passenger car safety requirements
  • Powers, responsibilities and management of railway companies
  • Traffic operations and rules
  • Carriage of passengers
    • Service requirements, persons with disabilities and personnel training
    • Baggage issues
  • Tariffs, rates and freight

 

 

 

 

 


This newsletter is published to keep our clients and friends informed of new and important legal developments. It is intended for information purposes only and does not constitute legal advice. You should not act or fail to act on anything based on any of the material contained herein without first consulting with a lawyer. The reading, sending or receiving of information from or via the newsletter does not create a lawyer-client relationship. Unless otherwise noted, all content on this newsletter (the "Content") including images, illustrations, designs, icons, photographs, and written and other materials are copyrights, trade-marks and/or other intellectual properties owned, controlled or licensed by Fernandes Hearn LLP. The Content may not be otherwise used, reproduced, broadcast, published,or retransmitted without the prior written permission of Fernandes Hearn LLP.

 


A proud Canadian law firm specializing in Transportation, Insurance and Commercial Law.