Citation: Gallant v. Piccott Date: PESCAD 17 Docket: AD-0859 Registry: Charlottetown

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1 Citation: Gallant v. Piccott Date: PESCAD 17 Docket: AD-0859 Registry: Charlottetown PROVINCE OF PRINCE EDWARD ISLAND IN THE SUPREME COURT - APPEAL DIVISION BETWEEN: STEPHEN ARTHUR PICCOTT, WALTER PICCOTT CHEVROLET OLDSMOBILE CADILLAC LIMITED, DOING BUSINESS UNDER THE FIRM NAME AND STYLE OF CHOICE RENT-A-CAR APPELLANTS AND: JOHN ROBERT GALLANT RESPONDENT AND: GENERAL MOTORS ACCEPTANCE CORPORATION OF CANADA LIMITED RESPONDENT Before: The Honorable Chief Justice N.H. Carruthers The Honorable Mr. Justice G.E. Mitchell The Honorable Mr. Justice J.A. McQuaid Ewan W. Clark Eugene S. Murphy, Q.C. William F.E. Dow Place and Date of Hearing Place and Date of Judgment Counsel for the Appellants Counsel for the Respondent, General Motors Acceptance Corporation of Canada Limited Counsel for the Respondent John Robert Gallant Charlottetown, Prince Edward Island April 17, 2000 Charlottetown, Prince Edward Island May 18, 2000 Written Reasons by: The Honorable Chief Justice N.H. Carruthers

2 Concurred in by: The Honorable Mr. Justice G.E. Mitchell The Honorable Mr. Justice John A. McQuaid

3 Citation: Gallant v. Piccott Date: PESCAD 17 Docket: AD-0859 Registry: Charlottetown STEPHEN ARTHUR PICCOTT, WALTER PICCOTT CHEVROLET OLDSMOBILE CADILLAC LIMITED, DOING BUSINESS UNDER THE FIRM NAME AND STYLE OF CHOICE RENT-A-CAR APPELLANTS AND JOHN ROBERT GALLANT RESPONDENT AND GENERAL MOTORS ACCEPTANCE CORPORATION OF CANADA LIMITED RESPONDENT (7 pages) Before: Carruthers, C.J.P.E.I.; Mitchell and McQuaid, JJ.A. Heard: April 17, 2000 Judgment: May 18, 2000 PRACTICE - JUDGMENTS AND ORDERS - SUMMARY JUDGMENT Motions Judge granted Summary Judgment in favour of one defendant in a motor vehicle accident case where defendant s vehicle was not driven by the owner. HELD: on appeal that the Order of the Motions Judge be set aside. The statutory onus issues raised by the Highway Traffic Act better left to a Trial judge for determination. CASES CONSIDERED: Bernard v. Thompson and Thompson (1976), 12 Nfld. & P.E.I.R. 452 (P.E.I.S.C.-T.D.); Howatt v. Larkin and Larkin (1979), 23 Nfld. & P.E.I.R. 45 (P.E.I.S.C) STATUTES CONSIDERED: Highway Traffic Act, R.S.P.E.I. 1988, Cap. H-5, s.1(m.1), ss.286, 287 RULES OF COURT: Prince Edward Island Rules of Civil Procedure, Rule 20, Rule 20.01(3)

4 Ewan W. Clark, for the Appellants Eugene S. Murphy, Q.C., for the Respondent, General Motors Acceptance Corporation of Canada Limited William F.E. Dow, for the Respondent John Robert Gallant

5 CARRUTHERS C.J.: [1] This is an appeal from a decision of the Chambers Judge who granted a motion by the respondent, General Motors Acceptance Corporation of Canada Limited (GMAC) for summary judgment pursuant to Rule 20 of the Rules of Court. BACKGROUND [2] GMAC was the owner of a 1996 Lumina motor vehicle which it leased to Walter Piccott Chevrolet Oldsmobile Cadillac Limited, doing business under the firm name and style of Choice Rent-A-Car (Piccott). [3] The Lumina motor vehicle was leased to Piccott subject to the terms and conditions of a Master Lease Agreement between GMAC and Piccott. Clause 1 of the Master Lease Agreement provides as follows: 1. VEHICLE USE Vehicles leased will be used by lessee only for daily rental to third parties under Rental Agreements in such form as GMAC may approve from time to time. [4] On December 19, 1996, the leased vehicle, while being driven by Stephen Piccott, an employee of Piccott, was involved in a motor vehicle accident. John Robert Gallant (Gallant), a passenger in the leased vehicle, was injured in the accident. He commenced an action against Stephen Piccott and Piccott for damages. He alleged that Stephen Piccott was negligent in the operation of the leased vehicle and that the vehicle was owned by Piccott. [5] Gallant then issued an Amended Statement of Claim whereby he added GMAC as a defendant and alleged in the Amended Statement of Claim that the vehicle driven by Stephen Piccott was owned by Piccott and GMAC. [6] Stephen Piccott and Piccott filed a defence and denied that Stephen Piccott was negligent. They also denied that Piccott was the owner of the leased vehicle. [7] GMAC also filed a defence and alleged it did not consent to the operation of the leased vehicle by Stephen Piccott. It also filed a cross-claim

6 Page: 2 against Piccott for indemnity and contribution. It alleged that Piccott failed to honour the terms of the Master Lease Agreement between them by allowing the leased vehicle to be operated by Stephen Piccott, and it was, therefore, not responsible for the injuries suffered by Gallant. [8] Piccott then filed a defence to the cross-claim denying that GMAC was entitled to indemnity and contribution. It admitted that the leased vehicle was at all material times being driven with the consent of Piccott but denied any negligence on the part of Stephen Piccott. Piccott further denied that it failed to honour the terms of the Master Lease Agreement and denies that the leased vehicle was operated without the consent of GMAC. [9] GMAC then sought an Order for Summary Judgment pursuant to Rule 20.01(3) on the basis there was no genuine issue for trial against it with respect to the Amended Statement of Claim. [10] The submissions before the Motions Judge focused on the question of consent. GMAC submitted that there was no genuine issue for trial as between it and Gallant as Stephen Piccott did not have the consent of GMAC to drive the leased vehicle. Gallant, Stephen Piccott and Piccott all took the position that there was a genuine issue for trial. [11] The Motions Judge found that it was agreed as between Piccott and GMAC that GMAC was the sole owner of the leased vehicle. He also found that Stephen Piccott did not have the consent of GMAC to drive the leased vehicle. He granted the motion for summary judgment. He held there was no genuine issue for trial as to whether Stephen Piccott had the consent of GMAC to operate the leased vehicle at the time of the accident giving rise to the litigation. He, therefore, granted an order dismissing Gallant s claim in the Amended Statement of Claim against GMAC, and he granted GMAC leave to discontinue its cross-claim against Piccott. [12] Stephen Piccott and Piccott now appeal from this Order and allege the Motions Judge erred in granting summary judgment in favour of GMAC. The respondent Gallant did not participate in the appeal. ANALYSIS

7 Page: 3 [13] The main issue to be resolved on this appeal is whether the Motions Judge erred in holding there is no genuine issue for trial as between the respondent Gallant and the appellant GMAC. [14] It is apparent from the Reasons for Judgment of the Motions Judge that the motion for Summary Judgment was argued and decided solely on the basis of consent as between GMAC, Piccott and Stephen Piccott. He states in para.7 of his Reasons for Judgment (see Appeal Book, Tab 3, p.9) that GMAC maintains the issue to be decided on the motion is whether or not Stephen Piccott, the driver of the motor vehicle, had the expressed or implied consent of GMAC to drive the vehicle within the meaning of s.287 of the Highway Traffic Act. He also states in para.8 that the position of the plaintiff Gallant and the defendants Piccott and Stephen Piccott was that the issue of consent was a genuine issue for trial. [15] The Motions Judge then deals with expressed consent and implied consent and concludes in para.38 of his Reasons for Judgment that there is no genuine issue for trial as to whether or not Stephen Piccott had the consent, expressed or implied, of GMAC to be driving its Lumina vehicle at the time of the accident giving rise to the litigation. He then dismissed the claim against GMAC as owner of the vehicle and granted GMAC leave to discontinue its cross-claim against Piccott. [16] It is, therefore, apparent that the Motions Judge granted the motion for Summary Judgment on the basis of GMAC s vicarious liability under s.287 of the Highway Traffic Act. He did not deal with the statutory onus which is placed on GMAC, as owner, by s.286 of the Highway Traffic Act to establish it was not negligent. [17] GMAC, as owner, has a statutory onus upon it to establish that the accident was not due to its negligence or improper conduct. This statutory onus would have to be dealt with by the Motions Judge before he could absolve GMAC of all liability for the accident. This question of GMAC s liability would be a genuine issue for trial as all the Motions Judge found was that the driver of the motor vehicle, Stephen Piccott, did not have the consent of the owner, GMAC. [18] The facts peculiar to this case and the applicable provisions of the

8 Page: 4 Highway Traffic Act, R.S.P.E.I. 1988, Cap. H-5, raise a question as to whether this is really a proper case for the application of the Summary Judgment Rule. [19] The action arises out of a motor vehicle accident upon a highway whereby it is alleged by the respondent Gallant as plaintiff that he was injured in the accident and that he suffered damages, loss of income and earning capacity as a result. Such an action is subject to the provisions of the Highway Traffic Act, R.S.P.E.I. 1988, Cap. H-5, and in particular ss.286 and 287 which state as follows: 286. When loss or damage is sustained by any person by reason of a motor vehicle upon a highway the onus of proof that the loss or damage did not arise through the negligence or improper conduct of the owner or driver is upon the owner or driver In an action for the recovery of loss or damage sustained by a person by reason of a motor vehicle upon a highway, every person driving the motor vehicle who is living with and as a member of the family of the owner thereof and every person driving the motor vehicle with the consent, expressed or implied, of the owner thereof shall be deemed to be the agent or servant of the owner of the motor vehicle and to be employed as such and shall be deemed to be driving the motor vehicle in the course of his employment, but nothing in this subsection relieves any person deemed to be the agent or servant of the owner and to be driving the motor vehicle in the course of his employment from the liability for such damages. [20] The statutory definition of owner as defined in the Highway Traffic Act is also important in this case. Section 1 (m.1) defines owner as follows: 1. In this Act (m.1) owner includes (i) (ii) the person who holds the legal title to a vehicle, in the case of a vehicle

9 Page: 5 that is registered, the person in whose name it is registered, (iii) (iv) (v) in the case of a vehicle that is the subject of a mortgage, the mortgagor if he is entitled to possession of the vehicle, in the case of a vehicle that is the subject of a hire-purchase agreement, the person in possession of the vehicle under the agreement, or in the case of a vehicle that is the subject of a conditional sale contract, the buyer under the conditional sale contract, if he is entitled to possession of the vehicle. [21] This definition is important to the facts of this case as the respondent Gallant alleges in para.4 of his Amended Statement of Claim that GMAC and Piccott were, at all material times, the owner of the motor vehicle. He also alleges in para. 8 of his affidavit filed in response to GMAC s motion for summary judgment that the registered owners of the motor vehicle which Stephen Piccott was driving were GMAC and Piccott. He relies on a letter he received from the Highway Safety Division of the Department of Transportation and Public Works (see Supplemental Appeal Book, Tab 7) which states: This is to certify that according to the records of the Highway Safety Division the vehicle described as follows: Year 1996 Make Chevrolet

10 Page: 6 Model Lumina Plate QG 919 Serial Number 2G1WN52M9T appears on the records of this Division as of 19th of December 1996 and is registered in the name of GMAC leased to Choice Rent-A-Car. [22] It would also appear that the provisions of s.1(m.1)(iv) of the Highway Traffic Act and para.5 of the Master Lease Agreement between GMAC and Piccott would have to be examined as well, as these provisions may also make Piccott an owner of the vehicle as far as the Highway Traffic Act is concerned. [23] The Motions Judge does not deal with the definition provisions of the Highway Traffic Act at all in determining the ownership issue of the vehicle. He deals with this issue in para.4 of his reasons for judgment where he states: [4] Gallant claims that at the time of the accident both Piccott and GMAC were the registered owners of the Lumina. However, it is agreed between Piccott and GMAC that on December 16, 1996, GMAC was the sole owner of the vehicle. [24] It may be all right for Piccott and GMAC to agree between themselves who was the sole owner of the vehicle, but I do not believe they can contract out of their lawful obligations under the Highway Traffic Act to the respondent Gallant by such an agreement. If the evidence of ownership was accepted during a trial, then it would appear they are both owners as far as the Highway Traffic Act is concerned and ss.286 and 287 would come into play. [25] I am, therefore, of the opinion that the issue of ownership cannot simply be resolved by what GMAC and Piccott may agree to and that it is a genuine issue for trial. [26] Section 286 comes into play once a plaintiff establishes that loss or damages resulted from a defendant s operation of a motor vehicle on a highway. It places a statutory onus on the defendant driver or owner of the vehicle to establish that such loss or damages did not arise as a result of the negligence or improper conduct of the defendant driver or owner. This burden remains on the defendant until the very end of the case when the question must be determined whether or not the defendant has sufficiently shown that the loss or damage was not in fact caused by the defendant s negligence. See: Bernard

11 Page: 7 v. Thompson and Thompson (1976), 12 Nfld. & P.E.I.R. 452 (P.E.I.S.C.T.D.), and Howatt v. Larkin and Larkin (1979), 23 Nfld. & P.E.I.R. 45 (P.E.I.S.C.). Even if it is shown that the accident was not caused by the negligence of the defendant owner, such a defendant may still be found vicariously liable under s.287 of the Highway Traffic Act for the negligence of someone else. [27] Section 287 comes into play when a plaintiff attempts to recover against the owner of a vehicle in a situation where the owner was not driving the vehicle at the time of the accident. The owner s consent then becomes an issue for the court, but as previously indicated, the issue of the owner s negligence under s.286 of the Highway Traffic Act must be dealt with by the court as well. An allegation or proof of negligence or improper conduct against the owner is not required because of the statutory onus placed upon the owner by s.286 of the Highway Traffic Act. The owner of the vehicle can only escape liability if the owner meets the statutory onus placed on the owner by the provisions of s.286 of the Highway Traffic Act and is not vicariously liable under s.287 of the Highway Traffic Act. [28] It may well be that the respondent Gallant, as plaintiff, may not be too concerned over the question of negligence as between the owner GMAC and the driver Stephen Piccott. The driver Stephen Piccott, however, and the owner Piccott, may well be very much concerned with the possibility of negligence or improper conduct on the part of the owner, GMAC, if Stephen Piccott is found to have been negligent in the operation of the motor vehicle. [29] Motor vehicle accident cases do not always lend themselves to summary disposition because of the statutory onus placed on the defendant by the provisions of the Highway Traffic Act. I am of the opinion that the statutory onus on the defendants, GMAC and Piccott, in this case presents a situation which should be left to a trial judge for determination. The trial judge will be in a better position to rule on the issues of ownership, consent and liability after all the evidence has been heard. [30] I, therefore, grant the appeal, and set aside the Order of the Motions Judge for Summary Judgment. The parties are granted an opportunity to speak to costs if they are unable to settle them among themselves.

12 Page: 8 Carruthers The Honorable Chief Justice N.H. I AGREE: The Honorable Mr. Justice G.E. Mitchell I AGREE: The Honorable Mr. Justice J.A. McQuaid