Royal Insurance Company v. Wawanesa Mutual Insurance Company,  O.J. No. 2924, Ontario Superior Court of Justice
Wawanessa Mutual Insurance Company (“Wawanessa”) insured Roy’s Electric which owned a modified truck. The truck was towing a compressor on two wheels attached by a hitch and driven by an employee of Roy’s Electric when it was involved in an accident with a school bus in which three children were injured and one was killed. Royal Insurance Company (“Royal”) insured the school bus.
The regulations under the Insurance Act, R.S.O. 1990, c. I.8 provide for a scheme of loss transfer intended to permit a more even payout of statutory accident benefits among insurers in motor vehicle cases. It is based in part on the classification of vehicles by size, use and weight. The classification system is premised on the probability that insurers of light vehicles are apt to pay a disproportionately higher share of accident benefits because occupants of such vehicles will suffer more serious injury than occupants of other types of larger and heavier vehicles. Once classification is determined, the scheme permits claims for the transfer of accident benefit losses based on fault.
Royal had originally made a loss transfer claim against Wawanessa on the basis that the truck was a “heavy commercial vehicle”. A heavy commercial vehicle is defined by regulation as a commercial vehicle with a gross vehicle weight greater than 4,500 kg. Without the compressor, the truck owned by Roy’s Electric weighed less than 4,500 and hence, did not constitute a heavy commercial vehicle. However, the definition of commercial vehicle under the regulations includes a trailer and therefore, if the compressor was found to constitute a trailer, the truck would qualify for the loss transfer claim as a heavy commercial vehicle.
Wawanessa and Royal were unable to agree on whether the compressor constituted a trailer, and Royal appealed the arbitrator’s finding that it did not.
There is no definition of the terms “gross vehicle weight” or “trailer” in the Insurance Act. The Court agreed with the arbitrator’s finding that the ordinary sense of the words “gross vehicle weight” meant the combined load weight of the vehicle.
The Court also agreed with the arbitrator’s conclusion that in the ordinary sense of the word, the compressor was not a trailer. In essence, the arbitrator’s decision regarding the compressor turned on his finding that it constituted a stand-alone construction device. It is therefore not to be considered in determining the weight of the vehicle. The appeal from the arbitration award was dismissed.
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