International Law

Action Against Insurer Pursuant to Uninsured Motorist Coverage Can Proceed Where Vehicle Driven Without Consent

In this case, Allianz Insurance was unsuccessful in its motion for summary judgment, dismissing a claim under its uninsured motorist coverage.

In George v. George, the plaintiff rented a car from the defendant Enterprise-Rent-A-Car. He purchased insurance that included uninsured motorist coverage in a policy issued by the defendant Allianz Canada. The rented car was taken by another defendant, without the consent of the plaintiff or of Enterprise. That party had assaulted the plaintiff and then driven off in the car. He was later involved in an accident in which the plaintiff was injured.

Both Enterprise and Allianz moved for summary judgment, on different grounds. Enterprise argued that it could not be liable because the car was being driven without its consent. As a result, it could not be liable to the plaintiff under s. 192 of the Highway Traffic Act. It appears that the motions judge, Mr. Justice William A. Jenkins, was prepared to allow Enterprise’s motion, although oddly, he said that the parties “did not specifically address” this motion in argument.

Most of the decision dealt with the motion by Allianz. The insurer argued that its coverage only applied where the plaintiff was legally entitled to recover from the owner or driver of “an uninsured automobile” and that the Enterprise car did not come within the definition of “uninsured automobile”.

The definition appears in s. 265(2) of the Insurance Act:

… An automobile with respect to which neither the owner nor driver thereof has applicable and collectible bodily injury liability and property damage liability insurance for its ownership, use or operation but does not include an automobile owned by, or registered in the name of the insured or his or her spouse. [Emphasis added]

Allianz argued that this case was caught by the exception in bold above, in that the automobile in question was owned by and registered in the name of “the insured”, namely, Enterprise. On this basis, it said, the uninsured motorist coverage was not available.

The plaintiff argued that the phrase, “the insured” in the definition referred to the person making the claim. Since the automobile was not owned by or registered to the plaintiff, so the argument went, the exception (in bold) did not apply. 

Justice Jenkins rejected Allianz’ argument, saying that it “ignores the legislative intent in enacting the statutory uninsured motorist regime”. He also said that it was necessary to look at the definitions of “person insured under a contract” and “insured” in sections 224 and 265 of the Insurance Act. His Honour was satisfied that those definitions “point to persons other than the named insured as enjoying protection under the policy”. Therefore, he dismissed the motion by Allianz.

Full post as published by Cavanagh Williams on March 24, 2008 (boomark / email).