Lessors Beware: Vicarious Liability And The Workplace Safety And Insurance Act

• Published date: 04 August 2021
• Subject Matter: Employment and HR, Insurance, Litigation, Mediation & Arbitration, Health & Safety, Insurance Laws and Products, Trials & Appeals & Compensation, Personal Injury
• Law Firm: Blaney McMurtry LLP
• Author: David Leck

Introduction

In Maria-Antony v. Selliah, 2014 ONSC 4264 ("Selliah"), the Ontario Superior Court dealt with the issue of whether a plaintiff may claim against the lessor of a vehicle for its vicarious liability of the driver, where the plaintiff's right of action has been removed against the driver pursuant to section 28 of the Workplace Safety and Insurance Act, 1997, S.O. 1997, c. 16, Sched. A ("WSIA").

The issue was addressed on a summary judgment motion. Justice O'Marra dismissed the motion and held that a plaintiff's limited right of action in these circumstances included a claim for damages arising out of the lessor's vicarious liability.¹ Unfortunately, the Divisional Court dismissed the lessor's appeal and decided to "say nothing" about Justice O'Marra's analysis.²

Six years later, the Ontario Courts still have not commented on Justice' O'Marra's determination.

Vicarious Liability of a Lessor and the Workplace Safety and Insurance Act

Section 28(1) of the WSIA bars the right of action of a Schedule 1 worker against another Schedule 1 entity, including an employer or worker, for any claims pertaining to the worker's injury. However, section 28(4) of the WSIA serves as an exception, stating that subsection (1) does not apply "if any employer other than the worker's employer supplied a motor vehicle, machinery or equipment on a purchase or rental basis without also supplying workers to operate the motor vehicle, machinery or equipment." In this regard, s. 28(4) creates a category of "unprotected defendants" that remain open to suit even if the plaintiff's right of action has been barred against other tortfeasors.

In the context of a motor vehicle accident, plaintiffs are frequently barred against suing another driver where they were both employed by Schedule 1 employers and were in the course of their employment at the time of the accident. However, due to section 28(4) of the WSIA, a lessor who owned the vehicle involved in the accident is often not protected by the WSIA. This is because, often times, the lessor is an employer who supplied the motor vehicle but did not supply any workers to operate it.

As owner of the vehicle, a lessor is vicariously liable for the driver pursuant to the Highway Traffic Act, R.S.O. 1990, c. H.8 ("HTA").³ Thus, if the driver is a Schedule 1 worker, then the plaintiff will still have a claim against the lessor for the negligence of the driver.

Yet, the WSIA also contains sections 29(3) and (4) which require the...