Richard Laurie Plaintiff v. Insurance Corporation of British Columbia, 2010 BCSC 620

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: Laurie v. Insurance Corp. of British Columbia, 2010 BCSC 620 Date: 20100430 Docket: 09-0365 Registry: Victoria Between: Richard Laurie Plaintiff And Insurance Corporation of British Columbia Defendant Before: The Honourable Madam Justice H. Holmes Reasons for Judgment Counsel for the Plaintiff: Sarah Klinger Counsel for the Defendant: Charlotte Salomon Place and Date of Trial: Victoria, B.C. April 12-13, 2010 Place and Date of Judgment: Victoria, B.C.

April 30, 2010 INTRODUCTION [ 1 ] Richard Laurie is a plumbing contractor and gas fitter who, in September 2008, had three employees working at the Sheraton Four Points Hotel in Langford. When some large payments came through for Mr. Laurie and other contractors working at the hotel, they celebrated at the adjacent West Coast Taphouse over the course of a Friday evening. [ 2 ] As Mr. Laurie travelled home from the Taphouse, his Ford F350 truck left the road and arrived on its side against another vehicle parked in a residential driveway. Mr. Laurie was in the vehicle but, fortunately, was not seriously injured.

The truck was damaged beyond repair. [ 3 ] ICBC refuses to pay Mr. Laurie for the loss of the vehicle mainly because, it says, Mr. Laurie drove the vehicle while seriously intoxicated and therefore breached his insurance policy and forfeited his right to coverage. Mr. Laurie agrees that he was seriously intoxicated, but says that he was not driving at the time of the accident. He says that because he was intoxicated, he accepted the offer of a man named Tyler to drive him home in the truck.

He says that he does not know or remember the accident itself or how Tyler quickly disappeared from the truck and the scene, and, having no information about Tyler’s identity, has been unable to find him since. [ 4 ] In this litigation, Mr. Laurie claims damages for breach of contract, for ICBC’s failure to pay the agreed cash value ($29,000) of the truck less the $300 deductible. [ 5 ] The parties agree that Mr.

Laurie’s claim for damages reflecting the approximately $3,500 in interest on his vehicle loan since the accident, which ICBC disputes as beyond the scope of his insurance policy, should be adjourned until after the determination of whether he is entitled to recover at all. THE ISSUES [ 6 ] The evidence and the parties’ positions, which I will describe in the Discussion below, give rise to the following issues: 1. whether Mr. Laurie was driving the truck at the time of the accident, and 2. if Mr. Laurie was not the driver, whether s. 55(5) of the Insurance (Vehicle) Regulation , B.C. Reg. 447/83 deprives Mr.

Laurie of coverage for failing to ensure that Tyler was properly licensed to drive and not intoxicated.

[ 7 ] During the trial, ICBC contended also that Mr. Laurie breached the conditions of his insurance policy (through the effect of paragraphs 75 (a)(ii) and (

c) of the Insurance (Vehicle) Act , R.S.B.C. 1996, c. 231 ) by knowingly misrepresenting a fact or making a wilfully false statement relating to the claim. [ 8 ] However, in closing submissions Ms. Salomon agreed that, to the extent that ICBC’s position in this area relies on Mr. Laurie’s statement that he was not the driver, it rests on the same evidence and has identical effect as ICBC’s position that Mr. Laurie breached his policy by driving while intoxicated. [ 9 ] Ms.

Salomon fairly conceded also that the evidence is insufficient to support ICBC’s alternative position that if Tyler was, in fact, the driver, then Mr. Laurie wilfully misrepresented to ICBC that he knew almost nothing about Tyler’s identity or location. [ 10 ] ICBC therefore abandoned its position concerning alleged false statements and the application of paragraphs 75 (a)(ii) and (c). DISCUSSION 1. WAS MR. LAURIE THE DRIVER? [ 11 ] Mr.

Laurie acknowledges that because of his intoxication, he would have breached his insurance contract, disentitling him to payment for the loss of the truck, had he been the driver at the time of the accident. This is the combined effect of s. 75 of the Insurance (Vehicle) Act and s. 55(8) (

b) of the Insurance (Vehicle) Regulation , the applicable portions of which read as follows: Act 75 All claims by or in respect of … the insured are invalid and the right of … an insured … to insurance money under the plan … is forfeited if: … (

b) the insured violates a term or condition of or commits a fraud in relation to the plan…. Regulation 55(8) An insured shall be deemed to have breached a condition of

section 49 and

Part 6 where (

a) the insured is operating a vehicle while the insured is under the influence of intoxicating liquor or a drug or other intoxicating substance to such an extent that he is incapable of proper control of the vehicle. [ 12 ] ICBC agrees that it bears the burden of proving that Mr. Laurie was the driver. [ 13 ] Mr. Laurie testified that he was not. [ 14 ] He testified that the celebratory drinking began in the Taphouse at about 4:00 p.m. He was called out at one point to a plumbing emergency in the hotel, but he put off the main work on that job until Monday because, with his drinking, he was in no shape to work.

He also left the Taphouse a few times during the evening to accompany friends or co-workers to the smoking area outside. [ 15 ] Mr. Laurie testified that after he returned from the washroom at around 11:00 p.m., he realized that all of the people he knew had left. He went outside to the smoking area, and there met and spoke with a person who introduced himself as Tyler. Tyler laughed at Mr. Laurie stumbling around, and they chatted about the truck, which Mr. Laurie had modified to increase its power. [ 16 ] Mr. Laurie knew that he was too intoxicated to drive.

He testified that he tried to telephone his wife, but could not reach her at the various locations he expected her to be with the four children; his wife did not have a cell phone. [ 17 ] He testified that when Tyler offered to drive him home, he made a bad choice: he unlocked the truck door, threw the keys inside for Tyler, and got into the passenger area of the truck. [ 18 ] Mr. Laurie testified that his memory from then on is spotty. He remembers the loud noise of the truck engine as the truck climbed a hill shortly before the accident.

He does not remember how the accident happened or its impact, but remembers finding himself in the back seat area of the truck, music blaring from the truck, and with people around trying to help. Although he has since been told that the truck was on its side -- as other evidence established it was -- he does not recall ever being aware of that. He does recall attempting to get out of the truck’s rear window, and a woman then pulling him out. [ 19 ] The woman Mr. Laurie remembers was, clearly, Kimberley Parfitt.

She was one of two witnesses ICBC called in the trial to establish that within a short time of the accident only Mr. Laurie, and no one else, was in or around the truck. [ 20 ] Ms. Parfitt and Randi-Leigh MacNutt were at a party in a house next to the driveway where the truck came to a stop on its side. Ms. Parfitt testified that, from the back porch of the house, they heard a screech of tires and then a crash. She testified that they both immediately ran toward the crash, and that she reached the truck within about 6-7 seconds. [ 21 ] Ms. Parfitt described helping Mr.

Laurie out of the truck through the rear window. She has occupational first aid training, and when Mr. Laurie was out of the truck she asked him to focus on her so that she could assess his mental condition. She then helped him into the house, and attended briefly to his injuries before paramedics arrived and took over.

[ 22 ] Ms. MacNutt testified that she also ran to the general area of the truck and watched Ms. Parfitt dealing with Mr. Laurie. However, Ms. MacNutt did not approach the truck itself and had no direct dealings with Mr. Laurie. [ 23 ] Neither Ms. Parfitt nor Ms. MacNutt saw anyone else in or around the truck, or in the roadway, or moving out of or away from the truck. [ 24 ] Ms. Salomon submits that it would have been impossible for the person Mr. Laurie describes as “Tyler” to have escaped the overturned truck and Ms. Parfitt’s and Ms.

MacNutt’s notice in the very short time between the accident and when they either reached the truck or were able to see it. She submits that Mr. Laurie’s evidence that such a person was driving is not credible. [ 25 ] In my view, aspects of Mr. Laurie’s account of the events and his evidence that he had no information with which to identify Tyler are not entirely convincing. [ 26 ] For example, Mr. Laurie offered remarkably little in description of Tyler: only that he had dirty blond hair, and was either the same height as his own or a little taller. He could not describe Tyler’s clothing.

He could also offer no information about whether he and Tyler had made plans for what Tyler would do once he had driven Mr. Laurie to his home. [ 27 ] Also, Mr. Laurie offered no explanation for why he accepted Tyler’s offer, instead of taking one of the safer options available to him. He agreed that he had a credit card with him, had a cell phone with him, was aware of the “red nose program” that would have driven him home, and was aware that rooms were available in the hotel. [ 28 ] Mr.

Laurie’s unsuccessful efforts to find Tyler after the accident were somewhat half-hearted. [ 29 ] He did take steps to place an advertisement in the Victoria Times Colonist, and it was through no fault of his own that, as he has recently learned, the advertisement did not run. He also spoke -- to no avail -- early in the week following the accident, with the people with whom he had been drinking, and with the bar owner, the bar manager, and some other people at the Taphouse. [ 30 ] It was Mr.

Laurie’s five or six posters around the bar and the area of the bar that call into question the sincerity of his efforts to find Tyler. The posters included only a small photograph of the truck, and the words, “Wanted: info on the person who drove this truck on Friday September 26, 2008, please call Rick @ [phone number]”. The photograph showed only a limited view of the truck, failing to show Mr. Laurie’s business logo and the contact information that the truck bore in at least two places. Nor did the posters mention the time of day of the relevant driving, an omission of some significance, if Mr.

Laurie was looking for Tyler, because Mr. Laurie had himself driven the truck to and from the hotel and the Taphouse several times during the work day. The posters also failed to mention the truck’s departure point, the route over which it was driven, or the location of the accident. Only the fact that Mr. Laurie posted them near the Taphouse and in the bar suggested that the driver and the truck in question had some association with those locations. [ 31 ] But other evidence supports Mr. Laurie’s evidence and his position in the trial that Tyler was the driver. [ 32 ] Ms. Parfitt testified that when Mr.

Laurie first came out of the truck, he told her that someone named Tyler had been driving, and asked whether Tyler was okay. Later, in the house, he told Ms. Parfitt that he had been drunk, and had therefore let Tyler drive. [ 33 ] Ms. MacNutt testified that as Mr. Laurie was walking towards the house, she heard him asking for a man named Tyler. She testified that because of Mr. Laurie’s questions about Tyler, people from the party began to look around the area for him. [ 34 ] Counsel agreed that Mr.

Laurie’s reported statements about Tyler were admissible as res gestae statements according to the principles described in R. v. Charles , 2009 BCSC 1391 . [ 35 ] In my view, these statements reduce the force of the inferences otherwise flowing from the weaknesses I have identified in Mr. Laurie’s account of the events before and after the accident. To conclude otherwise would require a finding that Mr.

Laurie concocted and delivered the Tyler story in his seriously intoxicated state shortly before or immediately after the accident, and had the presence of mind to deliver it to his rescuers in order to falsely protect his position. In my assessment, Mr. Laurie would not have acted in that manner. [ 36 ] Ms. Salomon submits that Mr. Laurie’s position that Tyler was driving is inconsistent with Ms. Parfitt’s and Ms.

MacNutt’s observations that they ran quickly to the scene of the accident and never saw anyone who could have been Tyler. [ 37 ] These witnesses rejected any suggestion that their run from the back porch of the house may have taken longer than 6-7 seconds. In cross-examination, Ms. Parfitt verified the actual duration of that time by using the court’s digital clock, and then confirmed her estimate. Ms. MacNutt rejected outright the suggestion that the lapse of time may have been longer than 6-7 seconds, but gave no reason for doing so. [ 38 ] For Ms.

Parfitt, the 6-7 seconds began when she heard the squeal of tires, which was about 3 seconds before she heard the crash, and ended when she reached the truck. For Ms. MacNutt, the 6-7 seconds started with the crash, which she testified was “a couple of seconds” or “not even” that long, from the time of the screech. [ 39 ] I have no doubt that Ms. Parfitt and Ms. MacNutt are sincere and honest witnesses. Their identical time estimates of “6-7 seconds”, even though it begins at different points, causes concern that they have discussed the events more than they now remember.

Nonetheless, I am satisfied that they arrived at or near the truck within a very short period of time, although likely longer than 6-7 seconds. [ 40 ] In my view, their evidence casts suspicion on Mr. Laurie’s evidence that Tyler was driving and must have left the truck and the scene within the short time they took to arrive, but it is of limited effect. Neither witness personally took

part in the search for Tyler, and no other evidence in the trial indicated how thorough or extensive the search may have been. The area was relatively dark (with

some street lights), and offered many potential hiding places for Tyler, were he minded to wait briefly and then flee the scene when the rescuers had gone. I am not persuaded, on the evidence, that the fact that neither Ms. Parfitt nor Ms. MacNutt saw anyone who might have been Tyler amounts to proof that no such person managed to leave the truck and escape their view. [ 41 ] On all the evidence, ICBC has not met its burden of proving on a balance of probabilities that Mr. Laurie was the driver. 2. DID MR.

LAURIE BREACH HIS POLICY BY NOT ENSURING THAT TYLER WAS LICENSED AND SOBER TO DRIVE? [ 42 ] ICBC submits that even if Tyler was the driver, Mr. Laurie breached the conditions of his insurance policy and forfeited his right to coverage because he failed to ensure that Tyler was properly licensed and sober to drive. [ 43 ] ICBC relies on

section 75 of the Insurance (Vehicle) Act , as quoted earlier. In the present context, ICBC relies also on s. 55(5) of the Regulation , which reads as follows: Regulation 55(5) An insured named in a[n owner’s] certificate … must not permit the vehicle described in the certificate … to be operated by a person or for a purpose that breaches a condition of this

section or

Part 6. [ 44 ] Mr. Laurie was asked in cross-examination whether he took certain steps to ascertain that Tyler was authorized and fit to drive, such as by asking to see his driver’s licence, ensuring he was not prohibited from driving, and ascertaining whether or not he was intoxicated. In each case, he responded that he did not recall. On the evidence as a whole, I find that he did not take those steps. [ 45 ] But that does not mean that s. 55(5) deprives Mr.

Laurie of coverage. [ 46 ] Subsection 55(5) says that an insured “must not permit” his or her vehicle “to be operated” in breach of the insurance conditions. As I read the subsection in its context in the Regulation , it presupposes that the vehicle has, in fact, been operated in breach of the conditions, and it denies coverage to an insured who permitted that breach to occur.

The subsection does not cast a non-inquiring insured into an independent breach, irrespective of whether the vehicle was actually operated in breach of the insurance conditions. [ 47 ] I am not persuaded that the circumstances of the accident themselves indicate that Tyler was unlicensed or was intoxicated so as to be incapable of the vehicle’s proper control.

No other evidence establishes that Tyler operated the vehicle in breach of the insurance conditions [ 48 ] Of no application, therefore, are the cases on which ICBC relies, which discuss the extent of the inquiries an insured must make in order to avoid the effect of s. 55(5). In those cases, the insurer proved a breach by the operator: see, for example, Kennedy v. ICBC , [1993] B.C.J. No. 1179, 16 C.C.L.I. (2d) 38 (B.C.S.C.) , Peters v. Sask. Government Insurance Office , 1956 CanLII 203 (SK CA) , [1956] S.J. No. 45, 2 D.L.R. (2D) 589 (Sask. C.A.), Nielson v.

Insurance Corp. of British Columbia (1997), 1997 CanLII 3454 (BC CA) , 37 B.C.L.R. (3d) 223, 92 B.C.A.C. 110 (C.A.). [ 49 ] Mr. Laurie’s failure to confirm that Tyler was licensed and sober to drive does not deprive him of coverage, because the evidence does not establish that Tyler was unlicensed or intoxicated. CONCLUSION [ 50 ] Mr.

Laurie is entitled to damages for the total loss of the truck. [ 51 ] If the parties are unable to agree as to the amount including interest, they should within thirty days of these reasons arrange through Trial Scheduling to seek the court’s directions about how the matter will be heard. Otherwise, damages will be in the amount set out in the table Ms. Salomon submitted. “H. Holmes, J.” The Honourable Madam Justice H. Holmes