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Confusion about municipal obligations emerges

Focus on Insurance Law
|Written By Shannon Kari
Confusion about municipal obligations emerges
James Tausendfreund says advising municipalities on how to apply a recent pair of Ontario Court of Appeal rulings is challenging.

Two decisions of the Court of Appeal released earlier this fall on the same day appear to be causing confusion about the extent of the legal obligations of municipalities to reduce the risk of automobile accidents at intersections.

The rulings in Smith v. Safranyos and Chiocchio v. Hamilton were argued separately, although both were released on Sept. 19.

The city of Hamilton was one of the defendants in both cases, which stemmed from serious motor vehicle accidents at intersections and where assessing the liability of one of the drivers and the obligations of the municipality for road repair were at issue.

The Court of Appeal upheld the decision of the trial judge in Smith that the city was 25-per-cent liable for the damages caused. However, in Chiocchio, the decision of the trial judge that the municipality failed to keep the roadway in a reasonable state of repair was set aside and the action against it was dismissed.

The Court of Appeal in its decision in Chiocchio stated that, in both cases, the three-judge panels concluded that municipalities can still be found liable for non-repair for failing to paint or maintain a stop line (near a stop sign), even if a driver is found to have breached a section of the Highway Traffic Act.

“The decisions in these cases are otherwise dependent on the unique facts of each case and the findings in the courts below,” stated justices Janet Simmons, Grant Huscroft and Bradley Miller.

Advising municipalities on how to apply these rulings is challenging, says James Tausendfreund, co-counsel for the city of Hamilton in both proceedings.

“It is confusing. We never argued that a city cannot be found liable. We argued that you cannot use a negligent driver for the reasonable driver standard,” says Tausendfreund, a lawyer at Zuber & Company LLP.

The city of Hamilton in Smith and the plaintiffs in Chiocchio have both indicated they intend to seek leave to appeal to the Supreme Court of Canada.

George Wray, a partner at Borden Ladner Gervais LLP in Toronto, who frequently acts for municipalities, says he hopes that leave is granted by the Supreme Court. 

“I don’t think you can square the two decisions in terms of the legal analysis. If you have a situation where drivers are clearly negligent, what does this mean for municipalities?” asks Wray.

The rulings make it difficult to provide “practical guidance” for risk managers at municipalities, says Andy Jairam, a partner at Loopstra Nixon LLP, whose  practice focuses on municipal liability and insurance defence.

“They are difficult to reconcile,” he adds.

The decision in Smith potentially “muddies the analysis” of the legal test set out by the Court of Appeal in 2014 in Fordham, says Jairam.

The accident in Chiocchio occurred at a rural intersection when the driver of a sedan accelerated westbound from a stop sign and t-boned a minivan that was travelling northbound and not subject to a stop sign. The driver of the minivan was rendered a quadriplegic from his injuries.

The lawyer for the sedan driver conceded that he was negligent in entering the intersection when it was not safe to do so. The stop sign was about nine metres from a faded stop line, close to the intersection. The trial judge concluded that the city was 50-per-cent responsible for failing to repaint the faded stop line.

The Court of Appeal found that the trial judge erred in his analysis of the municipality’s duty of repair and the ordinary reasonable driver standard. It noted that a section of the HTA requires drivers, even where there is no stop line, to stop the vehicle “immediately before entering the intersection.”

“Contrary to the reasoning of the trial judge, the obligation of reasonable drivers was not to determine whether they should stop 8 or 8.5 meters back from the intersection, so they would have an adequate sightline of northbound traffic,” the panel wrote. “It was to stop at a point close enough to the intersection so they would at least have sightlines in both directions.

“Drivers who fail to comply with the rules of the road established under the HTA and who also act in a manner that is contrary to common sense cannot meet the ordinary reasonable driver standard,” the panel in Chiocchio added.

The accident in Smith was described as a “horrendous two car collision” by the Court of Appeal panel hearing the case. Dawn Safranyos, the driver of a vehicle with four children inside, failed to yield the right of way on a through highway. Her vehicle was t-boned by the driver of another vehicle travelling beyond the speed limit who had consumed alcohol.

The trial judge found Safranyos 50-per-cent liable. The other 50 per cent of liability was apportioned equally to the city and to the driver of the other vehicle.

The Court of Appeal, in a decision written by Justice David Paciocco, upheld the finding of liability against the city of Hamilton for non-repair as set out in the Municipal Act.

The stop sign for westbound vehicles was located 10 metres before the intersection with the highway. A stop line that had existed at the intersection previously was removed in a “shave and pave” and had not been repainted at the time of the accident.

“The trial judge did not misunderstand the law. The gauge she used was the proper one of whether the road was in a sufficient state of repair to be safe for drivers exercising ordinary or reasonable care,” wrote Paciocco, with Chief Justice George Strathy and Justice Lois Roberts concurring. “Whether Ms. Safranyos was ‘mistaken’ as the trial judge said here, or negligent as the trial judge said elsewhere, does not matter to Hamilton’s non-repair liability. Ms. Sanfranyos’s negligence only goes to the apportionment of liability,” Paciocco said.

The Court of Appeal also rejected the city’s argument that the accident was solely a result of a driver negligently entering the intersection. 

“The trial judge had ample evidence that this intersection was confusing, even to drivers of ordinary care. She was entitled, in the circumstances, to accept Ms. Safranyos’s evidence that had there been a stop line she would have stopped there, just as she had at the stop sign,” Paciocco wrote.

Wray suggests the rulings could have broad implications for municipalities. 

“How are municipalities supposed to interpret the expectations of the reasonable driver in maintenance and road design?” he says.

Claire Wilkinson, who acted for the injured children, says that while each case may be fact specific, the Court of Appeal is sending a message.

“Municipalities would be advised to ensure that stop lines are clearly painted at all intersections where sightlines are obscured, particularly when the stop sign is set back from the intersection. There will be circumstances, such as in the Smith case, where the court finds that the design or maintenance of an intersection was a hazard to all drivers — including negligent drivers and reasonable drivers,” says Wilkinson, a lawyer at Martin & Hillyer Associates in Burlington, Ont. and immediate past president of the Ontario Trial Lawyers Association.

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