Joint Liability And The Nature Of Subrogation Under The OPCF 44R

• Published date: 09 June 2020
• Author: Ms Emily Vereshchak
• Subject Matter: Insurance, Litigation, Mediation & Arbitration, Insurance Laws and Products, Trials & Appeals & Compensation
• Law Firm: Rogers Partners LLP

The Court of Appeal has released a new and detailed decision in Tuffnail v. Meekes, 2020 ONCA 340, which addresses issues related to underinsured automobile coverage.¹ The decision was written by Associate Chief Justice Hoy, who was joined by Justice Doherty and Associate Chief Justice Marrocco (ad hoc).

The key takeaways from the decision are:

• The amounts available under the OPCF 44R endorsement are excess to the amounts available to the plaintiff from the insurers of a person jointly liable with the inadequately insured motorist.
• A plaintiff does not need to sue a tortfeasor in order for the tortfeasor to be found jointly liable. In other words, the tortfeasor's insurance can be "available" to the plaintiff even if the plaintiff does not sue the tortfeasor.
• Under the OPCF 44R, a subrogated claim advanced by an insurer by way of a third party claim is necessarily based on the third party's status as a potentially responsible joint or concurrent tortfeasor.
• When an insurer seeks to recover the amounts it paid by way of subrogation, it has to share the recovery with the plaintiff on a pro rata basis until the plaintiff receives full indemnification under the judgment.

Overview

Tuffnail was a passenger who was seriously injured in a single-vehicle crash following a wedding reception. Tuffnail commenced an action against the driver of the vehicle (Meekes), the groom (Bolton), and Tuffnail's automobile insurer (State Farm).

Tuffnail sought a declaration that he was entitled to coverage under the OPCF 44R, which had been purchased by Tuffnail from State Farm. Meekes was an inadequately insured motorist within the meaning of OPCF 44R.

State Farm defended the action and brought a third party claim against the bartender at the wedding, Coulthard, for contribution and indemnity for amounts it was required to pay pursuant to the OPCF 44R. The defendant, Bolton, also brought a third party claim against Coulthard. However, Tuffnail never sued Coulthard.

At trial, liability was apportioned amongst the parties as follows:

• Meekes (driver) - 65%
• Bolton (host) - 20.03%
• Coulthard (bartender) -11.12%
• Tuffnail (plaintiff) - 3.85%

The following insurance coverage was available to the tortfeasors:

• Meekes (driver) - $200,000
• Bolton (host) - $2,000,000
• Coulthard (bartender) - $1,000,000

After taking into account Tuffnail's contributory negligence, the net amount payable to Tuffnail ($3,435,034.71) exceeded the aggregate insurance coverage available.

The trial judge ordered that State Farm pay Tuffnail $800,000, which the parties agreed was the limit of coverage under the OPCF 44R².

The trial judge also concluded that State Farm was entitled to pursue recovery of its subrogated interest against Bolton and Coulthard, and that State Farm would share with Tuffnail on a pro rata basis any amounts it recovered by way of subrogation until Tuffnail received full indemnification pursuant to the...