Caruso v. Guarantee Co. of North America, (1996) 95 O.A.C. 174 (CA)

• Judge: Robins, Finlayson and Moldaver, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: November 20, 1996
• Jurisdiction: Ontario
• Citations: (1996), 95 O.A.C. 174 (CA)

Caruso v. Guarantee Co. (1996), 95 O.A.C. 174 (CA)

MLB headnote and full text

Carole Caruso (appellant) v. The Guarantee Company of North America (respondent)

(C23289)

Indexed As: Caruso v. Guarantee Co. of North America

Ontario Court of Appeal

Robins, Finlayson and Moldaver, JJ.A.

November 20, 1996.

Summary:

A plaintiff and her family sued for dam­ages resulting from a motor vehicle accident. The defendant was noted in default. The plaintiff sued her insurer, seeking decla­rations that her insurance was in full force and effect at the date of the accident and that it contained endorsements providing her with uninsured and underinsured coverage. Additionally, she sought an order that the insurer pay her the balance of all damages occasioned to her as a result of the motor vehicle accident and a declaration that her policy was available to satisfy the difference between the uninsured motorist coverage and the amount of any judgment obtained against the defendant motorist. The insurer admitted that the plaintiff's policy was in force on the date of the accident and contained endorse­ments for uninsured and underinsured cover­age, but pleaded, inter alia, that the action was barred by the limitation period under the Insurance Act. The plain­tiff moved to strike the insurer's limitation period defence and to add her husband and son as Fam­ily Law Act claim­ants. The insurer moved for sum­mary judg­ment.

The Ontario Court (General Division) refused to strike the insurer's limitation period defence, but allowed the insurer's summary judgment motion in part, on the basis that the plaintiff's action for declaratory relief respecting her entitlement to uninsured motorist coverage was statute barred. The court denied summary judgment respecting the plaintiff's entitlement to underinsured coverage. The court granted the plaintiff leave to amend her statement of claim to add her husband and son as claimants. The plaintiff appealed the dismissal of her action for declaratory relief respecting uninsured motorist coverage. The insurer cross-appealed the refusal to dismiss the plaintiff's claims for declaratory relief respecting the underinsured coverage and the granting of leave to add the plaintiff's husband and son as claimants.

The Ontario Court of Appeal allowed the plaintiff's appeal and set aside the order dismissing the plaintiff's action for declara­tory relief relating to uninsured coverage. The court dismissed the cross-appeal.

Insurance - Topic 4112

Automobile insurance - Uninsured or underinsured motorist coverage - Limita­tion period - Section 8(3) of the Ontario Uninsured Automobile Coverage Regula­tions provided that "[a]n action or pro­ceeding against an insurer in respect of bodily injury or death, or in respect of loss or damage to property other than the in­sured automobile or its contents, shall be commenced within two years after the cause of action arises." - The Ontario Court of Appeal held that s. 8(3) applied to declaratory actions - See para­graph 13.

Insurance - Topic 4112

Automobile insurance - Uninsured or underinsured motorist coverage - Limita­tion period - The plaintiff was injured in a motor vehicle accident - The defendant tortfeasor was noted in default - The plaintiff sued her insurer for declaratory relief respecting, inter alia, her entitlement to uninsured motorist coverage - The insurer obtained summary judgment on the basis that the claim for uninsured motorist coverage was barred by s. 8(3) of the Ontario Uninsured Automobile Coverage Regulations - The Ontario Court of Appeal set aside the summary judgment - The point at which the plaintiff knew or ought to have known that the tortfeasor was uninsured (i.e., when the cause of action arose) was a triable issue - See paragraphs 13 to 15.

Insurance - Topic 4112

Automobile insurance - Uninsured or underinsured motorist coverage - Limita­tion period - A plaintiff was injured in a motor vehicle accident - The tortfeasor was uninsured - The plaintiff sued her insurer for declaratory relief respecting, inter alia, her entitlement to uninsured motorist coverage - The insurer obtained summary judgment on the basis that the claim for uninsured motorist coverage was barred by s. 8(3) of the Ontario Uninsured Automobile Coverage Regulations - In setting aside the summary judgment, the Ontario Court of Appeal stated that if the action was out of time, it would not auto­matically mean that the plaintiff had no recourse against the insurer - The plaintiff would retain the option of obtaining judg­ment against the tortfeasor and suing the insurer for breach of contract if the insurer refused to honour the policy - See para­graphs 16 to 19.

Insurance - Topic 4112

Automobile insurance - Uninsured or underinsured motorist coverage - Limita­tion period - An insured sued her insurer for declaratory relief respecting, inter alia, her entitlement to underinsured motorist coverage - The insurer asserted that the action was barred by the limitation period under s. 17 of the O.E.F. 44, Family Pro­tection Endorsement - The motions judge concluded that the action was not barred and accepted the insured's submission that time did not begin to run until the amount of damages had been determined by settle­ment or judgment - Alternatively, the action was not out of time where it was difficult to conclude that the plaintiff's solicitor knew more than 12 months before the action was commenced that the claim would exceed the coverage limit of $200,000 - The Ontario Court of Appeal affirmed the decision - See paragraphs 20 to 24.

Practice - Topic 653

Parties - Adding or substituting parties - Plaintiffs - Application of limitation peri­ods - After the expiry of the two year limitation period under the Family Protec­tion Endorsement and s. 61(4) of the Fam­ily Law Act, a motions judge allowed a plaintiff to add her hus­band and son as Family Law Act claimants in her action against her insurer - The motions judge found that there were special cir­cum­stances warranting the amendment, the delay had occurred in good faith and there was no evidence of prejudice to the insurer - The Ontario Court of Appeal affirmed the decision - The plaintiff's action against the tortfeasor had already been amended to permit the claims and the insurer was attempting to reopen an issue between the plaintiff and tortfeasor - Further, an ex­tension was explicitly permitted by s. 2(8) of the Fam­ily Law Act and rule 26 of the Rules of Civil Procedure - See paragraphs 25, 26.

Practice - Topic 5708

Judgments and orders - Summary judg­ments - Bar to application - Existence of issue to be tried - [See second Insurance - Topic 4112 ].

Cases Noticed:

Johnson and Johnson v. Wunderlich, Wunderlich Estate and Commercial Union Assurance Co. (1986), 18 O.A.C. 89; 57 O.R.(2d) 600 (C.A.), consd. [para. 8].

Wimbush v. Progressive Casualty Insur­ance Co. (1993), 17 C.C.L.I.(2d) 69 (Ont. Gen. Div.), refd to. [para. 21].

Wawanesa Mutual Insurance Co. v. Shoe­maker (1994), 155 A.R. 2; 73 W.A.C. 2; 16 Alta. L.R.(3d) 210 (C.A.), refd to. [para. 21].

Deaville v. Boegeman (1984), 6 O.A.C. 297; 48 O.R.(2d) 725 (C.A.), refd to. [para. 25].

Moffett v. Farnsworth (1984), 6 O.A.C. 241; 47 O.R.(2d) 620 (Div. Ct.), refd to. [para. 25].

Wilson v. Sheppard (1985), 53 O.R.(2d) 17 (H.C.), refd to. [para. 25].

Statutes Noticed:

Insurance Act Regulations (Ont.), Unin­sured Automobile Coverage Regulations, Reg. 676/90, sect. 8(3) [para. 12].

Uninsured Automobile Coverage Regula­tions - see Insurance Act Regulations (Ont.).

Counsel:

Helen A. Rady, for the appellant;

Terrence R. Shillington, for the respon­dent.

This appeal and cross-appeal were heard on October 28, 1996, before Robins, Finlayson and Moldaver, JJ.A., of the Ontario Court of Appeal.

Finlayson, J.A., released the following judgment on November 20, 1996, for the Court of Appeal.