Indemnity for automobile damage is not restricted to damages arising from a collision, but also includes damages that arise from the use and operation of a motor vehicle

Redmond v. West Wawanosh Mutual Insurance Co., [2004] O.J. No. 110, Ontario Superior Court of Justice

Mr. Redmond got his truck stuck in some mud. He attempted to remove his truck from the mud but was unable to do so. A neighbour attempted to pull the truck out of the mud with his tractor, but failed. The next day, in Mr. Redmond’s absence and without his permission, a feed truck attempted to pull the truck out of the mud. It failed as well. Finally, on the same day, in Mr. Redmond’s absence and without his permission, a cement truck finally succeeded in pulling the truck out of the mud. At some point in all these attempts, the rear differential gear in one of the brake anchors was broken.

There were two sections in Mr. Redmond’s automobile insurance policy relevant to possible indemnification for the damage to his truck. Section 6, (indemnity without payment of a deductible) would apply if the damage to the truck arose from an accident for which another person was legally responsible; and section 7, (indemnity with payment of a deductible) would apply if the damage to the truck arose by fire, theft, vandalism, or was not caused by a mechanical fracture or breakdown. The trial judge found that section 6 did not apply because the damage to the truck did not arise as a direct result of an accident. The trial judge then found that the damage was caused by a mechanical failure or breakdown, and therefore indemnity was not required under section 7.

Mr. Redmond appealed the trial judge’s findings to the Ontario Divisional Court. The Divisional Court struck down the decision of the trial judge and ordered a new trial, on the basis that the trial judge did not properly interpret section 6 of the automobile insurance policy. The District Court noted that it was not correct to say that the application of the section was dependent on proof of an impact or accident with another vehicle. The section is dependent only upon proof that damage was caused by the use or operation of another motor vehicle in the circumstances that rendered the operator of the other motor vehicle liable in whole or part. In essence, the word “accident” as it appears in section 6 is simply a compendium for a “use or operation of an automobile”. The District Court therefore ordered a new trial.

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