Ontario Moves Forward on Regulating the Towing Industry

This week the Ontario government introduced Bill 189, the Roadside Assistance Protection Act, which, if passed, will finally introduce a regulatory scheme to the towing industry. This will be welcome news to consumers, insurance companies and honest towing companies.

The bill amends the Consumer Protection Act, 2002 and brings towing under the responsibility of the Minister of Consumer Services.  It comes following the establishment of stakeholder advisory groups and a public consultation process. The bill does not follow the recommendations of the Automobile Insurance Anti-Fraud Task Force, in that it does not create a new self-regulating body for the towing industry.  In the end, it was determined that the Task Force's recommendation was not feasible.  Instead, the towing industry will fall under the responsibility of the Commercial Vehicle Operator's Registration (CVOR) system.  The CVOR currently is responsible for large trucks and buses.  Technically the Registrar of Motor Vehicles becomes the regulator since the Registrar will have the authority to cancel a CVOR certificate.

The bill amends the Consumer Protection Act, 2002 to regulate consumer transactions involving tow and storage services. As examples, rules are provided for respecting:

1. Disclosure of information to consumers. 
2. Requirements that tow and storage services provided to consumers be authorized. 
3. Deviating from estimated payment amounts. 
4. The provision of itemized invoices.
5. Insurance requirements.  
6. Publication of rates. 
7. A Tow and Storage Consumers Bill of Rights. 
8. Requirements that consumers be allowed to remove personal property from towed or stored vehicles. 
9. The establishment of qualifications for tow and storage providers. 

The Act is also amended to provide for the appointment of inspectors and inspection powers, and to permit the Director to establish policies regarding the interpretation, administration and enforcement of the Act. The Repair and Storage Liens Act is amended to reflect the amendments to the Consumer Protection Act, 2002.

The Highway Traffic Act is amended in two main areas: the regulation of commercial motor vehicles and tow trucks and enforcement of the Act generally by the addition of administrative penalties. In respect of commercial motor vehicles, the Act is amended as follows:

1. To repeal the definition of “commercial motor vehicle” in subsection 16 (1) of the Act and replace it with the authority to define the term by regulation. 
2. To move other definitions related to “commercial motor vehicle” (“compensation”, “CVOR certificate”, “goods” and “safety record”) from subsection 16 (1) to subsection 1 (1), so that they apply to the whole Act and not only to sections 16 to 23.1, as currently provided. 
3. To provide for additional regulation of commercial motor vehicles. Provisions and regulation-making powers are added: prescribing requirements, qualifications and standards for commercial motor vehicles and for owners, operators and drivers of commercial motor vehicles; respecting documents and information to be carried by drivers and to be filed with the Ministry; adding grounds to refuse to issue, replace or renew a CVOR certificate; and requiring specified classes of owners and operators of commercial motor vehicles to install in their vehicles devices that are capable of recording and transmitting data about vehicle operation and driver conduct. 
4. To allow the Registrar of Motor Vehicles to order the immediate suspension or cancellation of a CVOR certificate where the Registrar has reason to believe that the certificate holder’s safety record or failure to comply with any Act demonstrates a significant risk to road safety and that it is in the public interest that the operator immediately cease operating all commercial motor vehicles. 
5. To prohibit drivers and other persons in charge of tow trucks from engaging in activities prescribed by regulation. In respect of general enforcement, the Act is amended to provide for the imposition of administrative penalties for the contravention of prescribed provisions of the Act and regulations. The amount of the penalties may not exceed $20,000.

Courts Have Inherent Jurisdiction to Order Assessments by Non-Health Practitioners

For several years, there have been two streams of cases regarding whether courts can order independent medical assessments by non-health practitioners under s. 105 of the Courts of Justice Act and r. 33.  The Divisional Court considered the issue in Ziebenhaus v. Bahlieda, 2014 ONSC 138 (S.C.J.).

The Court held that court have inherent jurisdiction to order physical or mental examinations by non-health practitioners.  The inherent jurisdiction is to be exercised to further trial fairness and justice.  There is no automatic rule that "levels the playing field" by providing the defendant is entitled to each type of report that is obtained by the plaintiff.  The focus is on the need for a particular examination in order to meet the plaintiff's case.

Ziebenhaus provides guidance on an area that has called out for clarification for some time. Defendants who bring motions to compel IMEs should make sure they address how the proposed assessment will further trial fairness and justice.  It may be that it will become easier to obtain IMEs with future care cost assessors, occupational therapists and so forth than in the past.

Action Against Municipality Dismissed for Failure to Give Notice

The new test for summary judgment as set out in the Supreme Court in Hryniakhas been applied to dismiss a claim against a Municipality for failing to give notice as required by s. 44(10) of the Municipal Act.

In Hennes v. City of Brampton, 2014 ONSC 1116 (S.C.J.), the plaintiff slipped and fell on an icy sidewalk.   He did not give notice until 18 months after the fall, contrary to s. 44(10) which provides for a 10 day notice period.  The plaintiff admitted he knew the City owned and maintained the sidewalk and that ice caused his fall.  He claimed he had a reasonable excuse for failing to give notice as he did not know how serious his injuries were until months after the fall. 

The Court did not accept that the plaintiff had a reasonable excuse; he did not seek advice about his rights or obligations for over a year after a claim was apparent.  In addition, the plaintiff bore the onus to show the Municipality was not prejudiced by the failure to give notice, and he failed to do so.  The plaintiff did not take timely photographs, and had not disclosed the contact information or a summary of a potential witness.  The action was dismissed. 

Hennes is a good example of how the new summary judgment rule can be used to dispose of a claim at an early stage. 

US District Court holds that suit between insurers should be transferred to district where accident occurred

Ohio Casualty Insurance Company, an excess insurer, sued Twin City Fire Insurance Company, a primary insurer, for breach of the duty of good faith and fair dealing for failing to settle a motor vehicle accident case within the policy limits.


The accident occurred in New York.  Ohio Casualty is an Ohio Corporation with its principal place of business in Boston.  Twin City is an Indiana corporation with its principal place of business in Hartford.


Twin City moved to transfer the case to the Eastern District of New  York.  In Ohio Casualty Ins. Co. v. Twin City Fire Ins., 2014 WL 495650 (D. Mass.), the court allowed the motion.  It noted the only connection of Massachusetts to the dispute is that Ohio Casualty's principal place of business is here, while a substantial amount of the relevant evidence is likely to be located in New York, where the underlying tort and jury trial occurred and where the underlying trial attorneys are located.   

Duty to Defend - Extrinsic Evidence Not Permitted

In Liardi v. Riotrin Properties (Kingston) Inc., 2013 ONSC 7544 (S.C.J), the defendant, Future Shop, brought a motion for a declaration that Zurich had a duty to defend the underlying action.  The issues on the motion were whether the plaintiff's pleadings raised covered and non-covered claims, and whether extrinsic evidence could be admitted in enlarge or explain the pleadings.

In the main action, the plaintiff alleged he bought a television at Future Shop and was instructed to move his car to the back of the store to load it.  An employee was having difficulty lifting the television so the plaintiff got out of his car to assist.  He alleged he slipped on ice and fell as he was walking to the rear.  The allegations against Future Shop included that it failed to have adequate persons to load the television, knew a dangerous condition existed and failed to ameliorate it, failed to ensure the premises were properly salted/sanded, and failed to properly monitor the area.

The landlord, Riotrin, was responsible for common areas under the lease.  Future Shop was named as an additional insured on the landlord's policy with Zurich.

Zurich sought to introduce extrinsic evidence as to the way Future Shop operated its businesses, including policies with respect to loading merchandise into customers' cars.  Justice Tausendfreund refused to admit the evidence as it touched on matters at issue against Future Shop which might prejudice Future Shop or bring it into conflict with the insurer.

Justice Tausendfreund held there was a duty to defend.  The plaintiff fell on snow and ice in the parking lot and the reason he did so was not relevant.  The claim did not relate to the way Future Shop did business but rather to the condition of the parking lot.  

When deciding duty to defend motions, courts will look at the essence of a claim.  It may be difficult to show that certain parts do not require a defence unless there are clear claims that could stand on their own.

OWCP and balance billing

Balance billing is a phrase that describes the situation where a medical provider tries to collect the amount that their bill was reduced when OWCP paid the provider's bill based upon the fee schedule. If a doctor charges $200 for an office visit, OWCP pays that bill in the amount of $120, and the provider then tries to collect the "balance" of $80 from you, that is called balance billing. Medical providers who accept payments in FECA cases are prohibited from balance billing and can be debarred for engaging in this practice. A medical provider agrees to accept what OWCP pays for a service and is not allowed to try to collect the balance from you. See 20 CFR 10.813: If OWCP reduces a fee, may a provider bill the claimant for the balance? A provider whose fee for service is partially paid by OWCP as a result of the application of its fee schedule or other tests for reasonableness in accordance with this part shall not request reimbursement from the employee for additional amounts. (a) Where a provider's fee for a particular service or procedure is lower to the general public than as provided by the schedule of maximum allowable charges, the provider shall bill at the lower rate. A fee for a particular service or procedure which is higher than the provider's fee to the general public for that same service or procedure will be considered a charge “substantially in excess of such provider's customary charges” for the purposes of §10.815(d). (b) A provider whose fee for service is partially paid by OWCP as the result of the application of the schedule of maximum allowable charges and who collects or attempts to collect from the employee, either directly or through a collection agent, any amount in excess of the charge allowed by OWCP, and who does not cease such action or make appropriate refund to the employee within 60 days of the date of the decision of OWCP, shall be subject to the exclusion procedures provided by §10.815(h).

Corruption alleged in FEMA flood map changes

According to NBC News, FEMA has changed flood zone maps to drastically lower insurance premiums of owners of ocean-front, flood-prone properties.