Appellant argues action not barred and backhoe is road-building machine under Highway Traffic Act
The Ontario Divisional Court remitted an action deemed statute-barred upon noting the lack of evidence that a motor vehicle insurance policy insured the backhoe that allegedly damaged an insured vehicle as required by s. 263 of Ontario’s Insurance Act, 1990.
In Gaudette v. 1929853 Ontario Limited (Property.Maintenance North), 2025 ONSC 5746, the appellant’s personal vehicle, insured with CAA insurance, was parked outside her cooperative residence unit on Jan. 28, 2023.
According to the appellant, in the early morning hours of that day, as allegedly captured by video surveillance footage, a backhoe or snow plough operated by the respondent collided with her parked vehicle while attempting to remove snow from the parking lot.
On Feb. 2, 2023, the appellant reported the incident to the Greater Sudbury Police Collision Reporting Centre. On May 9, 2023, she filed a small claims action alleging that the respondent’s negligence while removing snow from the parking lot caused her damages.
Her claim requested damages to cover vehicle inspection costs, vehicular repairs required due to the collision, $2,000 for suffering and loss resulting from the accident, and $500 for inconvenience and other expenses.
In its initial statement of defence, the respondent denied damaging the appellant’s vehicle. The respondent specified that it used a backhoe as snow removal equipment.
On July 9, 2024, the respondent moved to strike the appellant’s claim. It argued that ss. 258.3(1) and 263(5) of the Insurance Act statutorily barred the claim.
On Sept. 11, 2024, the presiding deputy small claims judge in Sudbury struck the claim as statute-barred and incapable of succeeding in law under r. 12.02 of the Rules of the Small Claims Court, O. Reg. 258/98.
On appeal, the appellant asked the court to set aside the judge’s decision and enter a judgment in her favour. She asserted that the judge erred in determining that her case was statute-barred because it fell within s. 263.
She claimed that the circumstances of the case went beyond that statutory provision because a backhoe was a road-building machine under Ontario’s Highway Traffic Act, 1990, and did not fall within the standard passenger vehicle classification, such that s.263(5) would apply.
Trial on merits ordered
The Divisional Court of the Ontario Superior Court of Justice allowed the appeal and remitted the matter to the Small Claims Court for a trial on the merits.
The court saw error in the small claims judge’s conclusion that s. 263 of the Insurance Act statutorily barred the appellant’s claim in circumstances where the respondent was allegedly operating a backhoe at the time, without evidence that a motor vehicle insurance policy insured the snow removal equipment.
The court noted that s. 263 applied when one or more automobiles, at least one of which was insured, damaged an insured automobile.
The court pointed out that the respondent’s defence submitted that it used a backhoe during the incident. The defence did not plead that the respondent was operating an automobile at the time or that the backhoe had automobile insurance.
The court found it unsurprising that the judge did not tackle this issue, which the parties failed to address directly in their oral or written submissions.
Lastly, the court said it should not enter judgment in the appellant’s favour. The court noted that the judge dismissed the claim as statute-barred and declined to resolve the action on its merits.
