



COURT OF APPEAL
    FOR ONTARIO

CITATION: 2237446 Ontario Inc. (409 Collision Centre) v.
    Intact Insurance, 2018 ONCA 394

DATE: 20180424

DOCKET: C64682

Hourigan, Huscroft and Nordheimer JJ.A.

BETWEEN

2237446 Ontario Inc. o/a 409 Collision Centre
    (2011)

Applicant (Appellant)

and

Intact Insurance and
    Bonnie Brennan

Respondents (Respondents in appeal)

Mark A. Klaiman, for the appellant

Lisa M. Carr, for the respondents

Heard:  April 20, 2018

On appeal from the judgment of Justice Ivan Bloom of the Superior
    Court of Justice, dated December 8, 2016 with reasons reported at 2016 ONSC 7711.

REASONS FOR DECISION

[1]

The applicant appeals from the dismissal of its application to have the
    initial certificate that was obtained by the respondent, Intact Insurance,
    under s. 24(5) of the
Repair and Storage Liens Act
, R.S.O. 1990, c.
    R.25 (
RSLA
) declared null and void.  At the conclusion of the
    hearing, we dismissed the appeal with reasons to follow.  We now provide those
    reasons.

[2]

On December 20, 2015, a motor vehicle owned by the respondent, Bonnie
    Brennan, was involved in an accident.  It was towed to the storage premises
    operated by the appellant. On January 6, 2016, Brennan executed a Vehicle
    Repair and Storage Agreement in which she agreed to pay a storage rate of
    $85.00 per day.  On the previous day, Intact had advised Brennan that it would
    pay the actual cash value of the vehicle, rather than pay for the cost to
    repair it.  Brennan agreed with Intact that she would authorize the appellant
    to release the vehicle to Intact.  Under her automobile insurance policy,
    Intact was obliged to reimburse Brennan for the storage costs.

[3]

Intact and the appellant could not agree on the storage charges that
    were properly due for the storage of the vehicle.  Consequently, Intact applied
    for and received an initial certificate under s. 24 of the
RSLA
. The
    certificate was issued on February 9, 2016. As of that date, Intact had not yet
    paid Brennan for the loss of her automobile.

[4]

By virtue of s. 24(6) of the
RSLA
, once Intact gave the initial
    certificate to the appellant, the appellant was obliged, within three days of
    receiving the initial certificate, to release the article described therein to Intact
    unless, within that period, it filed a notice of objection with the court.

[5]

Rather than filing a notice of objection, the appellant brought this
    application to have the initial certificate declared null and void.  The
    appellant asserted that, since Intact had not paid Brennan for the value of the
    vehicle, Intact was not, at that time, either the owner of the vehicle, nor was
    it any other person entitled to the vehicle under s. 24(1) of the
RSLA
. 
    Hence, according to the appellant, Intact was not entitled to obtain the
    initial certificate.

[6]

The application judge found that Intact had assumed liability under
    the contract of insurance and was then subrogated to the rights of its insured
    under s. 278 of the
Insurance Act
, R.S.O. 1990, c. I.8.  Section
    278(1) reads:

An insurer who makes any payment or assumes liability therefor
    under a contract is subrogated to all rights of recovery of the insured against
    any person and may bring action in the name of the insured to enforce those
    rights.

[7]

The application judge proceeded from this finding to conclude that
    Intact was a person lawfully entitled to the automobile and thus had the
    right to obtain an initial certificate under s. 24 of the
RSLA
.

[8]

We agree with the conclusion reached by the application judge.  In
    interpreting the provisions of the
RSLA
, we start with the modern
    approach to statutory interpretation, as espoused in E. A. Driedger,
Construction
    of Statutes
, 2nd ed. (Toronto: Butterworths, 1983), at p. 87 that the
    words of an Act are to be read in their entire context and in their grammatical
    and ordinary sense harmoniously with the scheme of the Act, the object of the
    Act, and the intention of Parliament:
Bell ExpressVu Ltd. Partnership v.
    Rex
, 2002 SCC 42, [2002] 2 S.C.R. 559, at para. 26; and
Indalex Ltd.,
    Re
, 2013 SCC 6, [2013] 1 S.C.R. 271, at para. 136.

[9]

It is obvious that the intent of the
RSLA
is to provide an
    expeditious procedure for dealing with disputes over storage charges, that
    protects both the storage holder and the owner of the item stored.  The
    interpretation that the appellant argues for would effectively require insurers
    to settle all matters arising out of a motor vehicle accident with its insured,
    and make the resulting payment, before it would be able to avail itself of the
    remedies under the
RSLA
.  In the interim, storage charges would
    continue to accumulate.  That interpretation is not one that is harmonious with
    the object of the
RSLA
.  It is also not one that reflects the realities
    of the marketplace, in which this statute operates.  There will be many
    occasions where issues will arise between an insured and an insurer under an automobile
    insurance policy.  It would not be to the benefit of either the insured or the
    insurer to have charges relating to the storage of motor vehicles involved in
    accidents mount up while those issues are resolved.

[10]

The
    appellants contention that statutory condition 6(7) of the standard automobile
    insurance policy overtakes s. 278 is untenable.  The statutory condition
    operates as between insurer and insured.  Section 278 operates as between an
    insurer and third parties like the appellant.

[11]

We
    would also note that the interpretation adopted, and the conclusion reached, by
    the application judge does not visit any unfairness on the appellant.  It is
    fully protected with respect to the storage charges that it claims to be
    lawfully entitled to while the issue over the propriety of those charges is
    determined.

Conclusion

[12]

The
    appeal is dismissed.  Intact is entitled to its costs of the appeal in the agreed
    amount of $6,779.30 inclusive of disbursements and HST.

C.W. Hourigan J.A.

Grant Huscroft J.A.

I.V.B. Nordheimer J.A.


