Co-operators Insurance Association v. Kearney, [1965] S.C.R. 106 (1964)

Supreme Court of Canada

Co-operators Insurance Association v. Kearney, [1965] S.C.R. 106

Date: 1964-11-19

Co-operators Insurance Association (Defendant) Appellant;

and

Robert Henry (Bert) Kearney (Plaintiff) Respondent.

1964: June 22; 1964: November 19.

Present: Taschereau C.J., Cartwright, Judson, Ritchie and Spence JJ.

ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO.

Motor vehicles-Negligence-Car owned by insurance company in collision with train-Passenger and driver fellow servants of company and acting in course of their employment as such servants-Driver negligent-Liability of company for injuries to passenger-Driver immune from liability-The Highway Traffic Act, R.S.O. 1950, c. 167, s. 50(2) [now R.S.O. 1960, c. 172, s. 105(2)]-The Workmen's Compensation Act, R.S.O. 1960, c. 437, ss. 123-125.

The plaintiff, who conducted a real estate and insurance business, was an agent of the defendant company in soliciting insurance and servicing policyholders. In the event of a claim being made by any policyholder to whom the plaintiff had sold a policy, it was the general practice of the company to send its own adjuster into the area and it was recognized to be part of the plaintiff's duty to introduce this adjuster to the policyholder and assist on the adjustment. On such an occasion, while returning to his office, the plaintiff suffered serious injuries when the automobile in which he was riding collided with a train. The automobile was owned by the company and was being driven with its consent by its adjuster, one L. The collision was caused solely by the negligent driving of L. The trial judge gave judgment against the company and L; on appeal, the Court of Appeal affirmed the judgment against the company but dismissed the action against L. Both Courts proceeded on the view that at the moment of the collision the plaintiff and L were fellow servants of the company and acting in the course of their employment as such servants. A further appeal by the company was brought to this Court.

Held: (Cartwright and Ritchie JJ. dissenting): The appeal should be dismissed.

Per curiam: Part II of The Workmen's Compensation Act, R.S.O. 1960, c. 437, did away with the defence of common employment in this case.

Per Taschereau C.J. and Spence J.: The relationship between the plaintiff and the defendant at the time of the accident was, for the limited purpose of the adjustment and on the limited occasion, not solely that of insurance agent and insurance company but was that of master and servant. The defendant owed a duty by implied term of contract to the plaintiff to take reasonable care to provide for his safety when he was engaged in the course of his employment, and there was by the negligence of L a breach of that duty, a breach for which the defendant as the employer of L was responsible in law.

Also, s. 124 of The Workmen's Compensation Act gave the plaintiff a statutory right of action for damages which occurred "by reason of the negligence of any person in the service of his employer (i.e., L) acting within the scope of his employment". There was no doubt that L at the time was certainly acting within the scope of his employment.

The plaintiff, therefore, was entitled to succeed either on the basis of the common law liability of his employer or on the basis of the statutory liability created by s. 124 of The Workmen's Compensation Act.

The argument that s. 50(2) of The Highway Traffic Act, R.S.O. 1950, c. 167 (now R.S.O. 1960, c. 172, s. 105(2)) barred the right of the plaintiff to recover was rejected. If the plaintiff had a cause of action against his master by reason of the negligence of the master's servant, subs. (2) did not take it away, even though at the time it arose the plaintiff was being carried in his employer's motor vehicle. Harrison v. Toronto Motor Car Ltd. and Krug, [1945] O.R. 1, approved. All that s. 50(2) of the Act did was to bar recovery against an owner or driver. The action upon the tort was not barred against the employer.

Per Judson J.: The appeal should be dismissed in view of the decision in Harrison v. Toronto Motor Car Ltd. and Krug, supra, which could not be distinguished from the present case and unless the Court was ready to overrule that case, it must govern.

Per Cartwright J., dissenting: If, as argued by the plaintiff, it was decided in Harrison v. Toronto Motor Car Ltd. and Krug, supra, that although the liability for the injury caused directly and solely by L's negligence was taken away as against him the result was that, while L could not be sued, the liability remained and could be enforced against the defendant, then that decision was wrong and ought not to be followed.

The effect of s. 50(2) of The Ontario Highway Traffic Act, R.S.O. 1950, c. 167 (now R.S.O. 1960, c. 172, s. 105(2)), was not merely to afford a personal or procedural defence to the driver but to take away the passenger's right of action founded upon the driver's negligence.

Where the only breach of the dut...

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