Enterprise Rent-a-Car Canada Ltd. v. Meloche Monnex Financial Services Inc., 2010 ONCA 277

• Judge: Sharpe, Rouleau and Epstein, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: February 08, 2010
• Jurisdiction: Ontario
• Citations: 2010 ONCA 277;(2010), 261 O.A.C. 7 (CA)

Ent. Rent-a-Car v. Meloche Monnex Financial (2010), 261 O.A.C. 7 (CA)

MLB headnote and full text

Temp. Cite: [2010] O.A.C. TBEd. AP.039

Enterprise Rent-a-Car Canada Limited (applicant/respondent) v. Meloche Monnex Financial Services Inc. (respondent/appellant)

(C50922; 2010 ONCA 277)

Indexed As: Enterprise Rent-a-Car Canada Ltd. v. Meloche Monnex Financial Services Inc.

Ontario Court of Appeal

Sharpe, Rouleau and Epstein, JJ.A.

April 15, 2010.

Summary:

Lee rented a car from Enterprise. Zhou was driving the car with Lee's consent. Lee and Koo were passengers. There was a single car accident. Lee and Koo were injured. They brought a tort claim against Enterprise and Zhou. Zhou had no automobile insurance. Lee was insured by Meloche Monnex. Enterprise applied for an order declaring Meloche Monnex to be the first insurer to respond to Lee's and Koo's claims and requiring Moloche Monnex to defend and indemnify Enterprise and Zhou for the claims.

The Ontario Superior Court granted the order. Meloche Monnex appealed.

The Ontario Court of Appeal allowed the appeal, setting aside the order.

Insurance - Topic 788

Insurers - Liability - Where two or more policies cover risk - Contribution among insurers - Lee rented a car from Enterprise - Zhou was driving the car with Lee's consent - Lee and Koo were passengers - There was a single car accident - Lee and Koo were injured - They brought a tort claim against Enterprise and Zhou - Zhou had no automobile insurance - Lee was insured by Meloche Monnex - Enterprise applied for an order declaring Meloche Monnex to be the first insurer to respond to Lee's and Koo's claims and requiring Meloche Monnex to defend and indemnify Enterprise and Zhou for the claims - The application judge granted the order - Meloche Monnex appealed - The Ontario Court of Appeal allowed the appeal, setting aside the order - According to s. 3.3.5 of the Meloche Monnex policy and s. 277(1.1) of the Insurance Act, if Lee's Meloche Monnex policy was "available", Meloche Monnex would be the first insurer to respond - However, the Meloche Monnex policy was not "available" with respect to a tort claim brought by Lee and Koo against the driver and/or owner of the vehicle that Lee had rented - The policy provided coverage where a liability claim was asserted against the renter either as the driver or, where the vehicle was being driven by someone else with the renter's consent, as the renter - The policy would have covered Lee regarding any claims brought against him arising from the negligence of the rented vehicle's driver, but it provided no coverage against other claims - Under s. 239(1), if Lee had been a passenger in his own vehicle and was injured by Zhou's negligence as a driver, Meloche Monnex would have been obliged to provide Zhou with coverage for Lee's tort claim - However, nothing in the policy or the Insurance Act extended that coverage to vehicles rented by the insured - The priority provisions of s. 3.3.5 of the policy and s. 277(1.1) only applied if insurance was "available" - As Lee's Meloche Monnex policy did not provide coverage for the claims asserted, it was not "available" and Meloche Monnex was not liable to provide coverage.

Insurance - Topic 2945.1

Contribution among insurers - Two or more policies covering same loss - [See Insurance - Topic 788 ].

Insurance - Topic 4149

Automobile insurance - Vehicle rentals - Extent of coverage under lessee's policy - [See Insurance - Topic 788 ].

Statutes Noticed:

Insurance Act, R.S.O. 1990, c. I-8, sect. 277(1.1) [para. 7].

Counsel:

Suzanne Courtlander and David L. Silverstone, for the appellant;

Michael S. Schmidt and Jiku, J.,Elamathail, for the respondent.

This appeal was heard on February 8, 2010, by Sharpe, Rouleau and Epstein, JJ.A., of the Ontario Court of Appeal. On April 15, 2010, Sharpe, J.A., delivered the following judgment for the court.