Social Host Liability

With the holiday season in full swing, many of us will be hosting our friends and family for dinners and other social gatherings where alcohol will be consumed.   It is important not only from a social responschampagne-glasses-original-370x229ibility perspective, but from a legal perspective, to take measures to avoid having your guests drive home while impaired.

“Social host liability” is the legal theory of whether a host of a party (or owner of the home) can be held responsible for injuries caused by a guest who drives away drunk.    If your guest drives drunk and subsequently causes a car crash, injuring innocent parties, in some cases you as the “social host” could have a “duty of care” and be held responsible for the injuries caused by the drunk driver.

Some steps to take to avoid being held liable for an accident caused by your drunk guest include:

  • If you are sending invitations, suggest on the invitation that guests take taxis, a legal ride sharing service, or public transportation, if they do not have a designated driver.   This gives your guests notice that you take this issue seriously.
  • Be prepared to take a firm and unequivocal stance with guests that they will not be allowed to drive away from your house if they are impaired.   Consider whether taking their keys is an option.
  • Verify who the designated drivers are and keep an eye out to make sure that designated drivers are not drinking.
  • Consider having taxi chits available for your guests.
  • Call cabs for guests yourself and give the cab driver the fare up front.
  • If available in your community, call a service such as Operation Red Nose.
  • Invite impaired guests to spend the night in a spare bedroom or on your couch.

Canadian Law

The leading Canadian Case on social host liability is the Supreme Court of Canada case Childs v. Desormeaux [2006] 1 SCR 643.

The defendant had attended a bring-your-own-alcohol party.   He consumed alcohol, left the party, and was subsequently involved in a serious accident with the plaintiff, Childs.  Childs was left a quadriplegic.   The Court was asked to decide if social hosts of parties where alcohol is consumed have a duty of care to public users of the road.

In Childs, the Court found that the host did not owe a duty of care to other users of the road who were harmed by the host’s intoxicated guests.  However, the absence of a duty of care was found only on the very specific facts of the case, notably that the intoxicated driver had brought and consumed his own alcohol at the party.   He had not been drinking supplied by the host.

Although simply hosting a party where guests are drinking is not enough to demonstrate the host’s liability, the court emphasized the facts of the case and indicated that social host liability could possibly be found in a scenario where the host provided the alcohol and knew the guest had become income and would be driving.

There is a positive duty of care in paternalistic relations of supervision and control, as noted by the Court.  Homeowners should be careful if there is a party in their home and they know (or should know) that young people are consuming alcohol.  Since Childs, there have been several cases that touch on these issues directly, including several summary judgment motions in Ontario (where a party asks for a decision to be made on an issue before trial).

In Hamilton v. Kember, 2008 CarswellOnt 1012, 165 A.C.W.S. (3d) 246, the plaintiffs were at a party hosted by a 17 year old.   Her parents had given the teenager permission to hold a party, subject to certain rules, including no alcohol consumption, and their liquor cabinet was locked up.    The parents left to go camping for the weekend.  The defendant motor vehicle operator attended the party, and drove impaired, resulting in catastrophic injuries to his passengers, the plaintiffs.    The teenager, her parents, and the driver were all sued.   The teenager and her parents brought a motion for summary judgement, arguing they were not liable because they had not served alcohol.   The judge stated “In my view the fact that [the host] did not serve alcohol is not sufficient to negate potential liability by the parents in these circumstances; therefore it cannot be said that the defendants owed no duty of care to the plaintiffs and this results in a genuine issue for the trial judge to consider.”

In a similar case (Kleitch and Miller), a teenager held a party at the family cottage and allowed guests to drive home despite the parents and the party-holder knowing that they were intoxicated.  The plaintiff passenger was injured in a crash.  On a motion for summary judgement, the judge refused to determine that the parents were not liable, because the plaintiff, being under the age of 19, was particularly vulnerable.

However, in a similar case,  Ferrier v. Hubbert, 2015 ONSC 5286 (Ont. S.C.J.) where the person holding the party was an adult, the parents of that person, the property owners, were found not liable, where the parents did not supply food or alcohol to guests.  There was found to be no duty of care given the host was an adult.

The homeowner parent in Sabourin (Litigation guardian of) v. McKeddie, 2016 CarswellOnt 5956, 2016 ONSC 2540, 265 A.C.W.S. (3d) 538 was also found not to be liable because there was an “absence of evidence” that the homeowner parent provided alcohol to the underage parties or even knew that there was underage drinking occurring.    However, a single additional piece of evidence could have changed this result, particularly given there were differences in the witness’ evidence.

Despite the homeowner defendant’s success in Ferrier and Sabourin, a high level of vigilance is the only safe approach when hosting a party where alcohol is consumed, regardless of the guest’s ages.

Edward (Ted) Masters is a personal injury lawyer in Ottawa with over 35 years of experience representing those seriously injured in car accidents. He can be contacted by his direct phone number, 613-566-2064, or by email at ted.masters@mannlawyers.com.

 

 

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Court Of Appeal Clarifies Pre-Judgment Interest Rate

Insurance companies use their long experience paying out claims, including the payment Appealof pre-judgment interest, in setting premium rates. Premiums are based on the pre-judgment interest rate in force at the time they are paid. It can take several years for a complex motor vehicle accident that results in serious injuries, to wind its way through the litigation process. During that time period the insurance company has the benefit of the investments it made with the at fault driver’s insurance premium. It seems unfair to penalize an injured party by retroactively applying a lower interest rate to their damages for pain and suffering when the insurer reasonably expected to pay a higher rate when it set and collected the premium from the at fault driver.

In 2015 we published several blogs on the interest rate that should apply to claims for pain and suffering in motor vehicle accident cases. Our most recent blog on August 24, 2015 ended with the Statement that “we will have to await the decision of the Court of Appeal for Ontario for a final determination of this question.” Well the Court of Appeal has now spoken.

In El-Khodr v. Lackie the innocent driver, Mr. El-Khodr, was seriously injured when the tow truck he was operating was rear-ended. Following a trial the jury awarded Mr. El-Khodr damages totaling $2,931,006 of which $89,167 was pre-judgment interest on general damages for his pain and suffering. The trial judge had decided that prejudgment interest on the general damages should be calculated at 5 per cent (the rate that was in effect prior to January 1, 2015 when the pre-judgment interest rate was reduced by an amendment to s. 258.3(8.1) of the Insurance Act).

The Court of Appeal decided that the reduced interest rate was effective from the day the amendment to s. 258.3(8.1) of the Insurance Act came into force. The reduced rate applied to all actions that had been started before the amendment. As a result, the interest rate to be applied on Mr. El-Khodr’s general damages was 2.5 per cent. As a result of the reduction in the interest rate the interest on his general damages should have been $44,583 and not the $89,167 awarded by the trial judge.

In Cobb v. Long Estate, the plaintiff Cobb suffered chronic pain that prevented him from working and performing household tasks. A jury awarded him $220,000 in damages but after deducting other insurance benefits Cobb had received and a statutory deductible that applied to general damages, the judge calculated a final judgment amount of $34,000.

When addressing the issue of pre-judgment interest on general damages the trial judge did not decide whether the amendment in s. 258.3(8.1) which reduced the rate of prejudgment interest for pain and suffering from five percent applied retrospectively. Instead, the trial judge exercised the discretion he was given by s. 130 of the Courts of Justice Act and set the prejudgment interest rate at three percent.

The Court of Appeal found that the trial judge properly exercised the discretion he had to set the rate of pre-judgment interest payable on the general damages awarded to Cobb and did not apply the lower statutory rate.

Edward (Ted) Masters is a personal injury lawyer in Ottawa with over 35 years of experience representing those seriously injured in car accidents. He can be contacted by his direct phone number, 613-566-2064, or by email at ted.masters@mannlawyers.com.

Changes to the Ontario Insurance Act that will directly impact on your Auto Insurance Benefits – Consumers Beware

Auto Insurance

Effective June 1, 2016, the Ontario Government has introduced changes to the automobile insurance system which will greatly affect the coverage consumers select and the price they will pay for auto insurance.   Many of these changes affect the statutory accident benefits that a person will receive if they have been injured in an automobile accident regardless of who is at fault.   Some of these benefits have been reduced and some options for increased coverage have been eliminated or changed.

Accordingly, it is absolutely vital for an individual to speak with their auto insurance broker to determine what the best coverage is for them and in many cases the increased coverage can often be provided at a minimal cost.

These changes will apply only to auto insurance policies issued or renewed after June 1, 2016.

Previously, medical and rehabilitation benefits for non-catastrophic injuries (less serious) provided a maximum of $50,000.00 in benefits with an additional $36,000.00 available for attendant care if deemed necessary.   Under the June 1, 2016 changes these benefits have been combined and reduced to $65,000.00 total.    A party can now choose to increase the benefits to a total of $136,000.00.

The 2016 changes also effectively cut in half coverage available to those with catastrophic injuries (serious brain injuries/spinal cord injuries).   Prior to June 1, 2016, the limit for medical care and rehabilitation and attendant care was 1 million dollars each.   Under the new policy these benefits have been combined and reduced to 1 million dollars in total.    An insured can now choose to add on an additional 1 million dollars for a total of 2 million dollars available for catastrophic injuries.

Disability claim

Prior to June 1, 2016, if an individual is unable to work they can receive income replacement benefits reflecting 70% of one’s gross income up to a maximum of $400.00 per week.   The new policy does not cause any changes.  However, an individual can now choose to increase their weekly limit of income replacement benefits (if eligible) to $600.00; $800.00; or $1,000.00 per week.

Other benefits/coverage including housekeeping and home maintenance expenses, death and funeral benefits and dependent care benefits can all be increased or modified for additional premiums.

It is important to speak to your auto insurance broker to determine what the best option for you is and how much any additional premiums will be.

It may very well be that a very minor increase in premium can afford you significant increased benefits.   If no changes are made one’s insurance, coverage will automatically default to the current new low standard benefits.

Change in Pre-Judgment Interest Determined to be Retroactive

We blogged about the change in the pre-judgment interest rate last month. As of January 1, 2015, the Insurance Act was amended to provide that the 5% pre-judgment rate set out in the Rules of Civil Procedure does not apply in motor vehicle accident cases. As a result, pre-judgment interest on general or non-pecuniary damages in motor vehicle accident cases will now be based on the rate that applies to all other damages. That rate is presently 1.3%.

A question arose as to whether the change was intended to be retroactive, that is, whether it was intended to be applied to motor vehicle accidents that occurred before January 1, 2015. The recent decision in Cirillo v. Rizzo has answered that question, at least for now. The court in that case concluded that while entitlement to pre-judgment interest is a substantive right (akin to the right to sue, for example), the mechanism for determining the amount of pre-judgment interest in a particular case is procedural in nature. Procedural amendments are presumed to apply retroactively and the court found that the change in the pre-judgment interest rate was intended to apply to all motor vehicle accident cases regardless of the date of the accident.

Change in Pre-Judgment Interest Rate

There has been a change in the interest rate that applies to non-pecuniary damages (general damages or damages for pain and suffering and loss of enjoyment of life and damages under the Family Law Act) as of January 1, 2015. This rate was reduced by the Province of Ontario from 5% to 1.3% no doubt as a result of the efforts of the insurance lobby.

This signals a change in philosophy. The pre-judgment rate was kept artificially high by the government while interest rates were falling in general in order to incentivize insurers to deal fairly with injured victims. It was, in effect, used as a means to redress the imbalance of power between insurers and car accident victims and to ‘level the playing field’. This is yet another setback for accident victims in Ontario.

Insurers – Bad Faith Negotiating

Many people don’t kpaperwork[1]now this, but insurers are required by law to attempt to settle a motor vehicle accident claim as quickly as possible. If they drag their feet, play hardball, negotiate in bad faith or refuse to consider reasonable settlement offers then this behavior will be considered by the court when it comes time to make an award of costs in the litigation.

As a general rule, successful parties are entitled to an award of costs.  In the recent Ontario case of Maxwell v. Luck, the trial judge ruled that the insurance company breached its statutory duty to attempt to settle the claim expeditiously.  He ordered that the insurer pay the plaintiff’s legal costs of the litigation in the amount of $206,000.00 together with the further sum of $50,000.00 that he described as a ‘remedial penalty’ that was assessed against the insurance company owing to its breach of statutory duty.

FAMILY PROTECTION ENDORSEMENT – OPCF-44R

An Ottawa court case decided in January that the Family Protection Endorsement (OPCF-44R) did apply to cover a young man (not named in the policy) who received serious injuries in an accident caused by an uninsured driver.  Despite the fact the young man had a pattern of living at more than one location, the court found the coverage was available to him since one of the ‘residences’ belonged to his mother, who was the named insured under the policy.

Every driver on the road should have this coverage because if you are involved in an accident with an uninsured or underinsured driver, it will provide between one to two million dollars of additional insurance coverage in the event you are injured in the accident.  If you are not sure whether you have this coverage you should contact your insurance agent right away.