Holmes v. Jarrett, 1993 CanLII 8479 (ON SC)
Holmes et al. v. Jarrett et al.
Pisek v. Allstate Insurance Company
[Indexed as: Holmes v. Jarrett]
68 O.R. (3d) 667
 O.J. No. 679
Ontario Court of Justice
General Division, Granger J.
March 22, 1993*
*This previously unreported judgment was recently brought to the attention of the editors.
Courts -- Stare decisis -- Previous judgment of same court should be followed unless there is indication that judgment was given without consideration of appropriate statute or that relevant case law was not considered. [page668]
HH was one of five passengers in a vehicle operated by TJ that was involved in a collision with a motor vehicle operated by KG. HH was injured, and she sued TJ and KG for damages. Both TJ and KG were injured under valid motor vehicle liability policies with $1 million of coverage respectively. However, it appeared that this insurance coverage would not be sufficient to satisfy HH's claim and also the claims of the other injured passengers. In these circumstances, HH added a claim against her own insurer, Alpina Insurance Company of Canada ("Alpina") under an "Underinsured Motorist Endorsement S.E.F. Number 44" ("S.E.F. 44"). Relying on the judgment in Despotopoulos v. Jackson, where Rutherford J. held that S.E.F. 44 coverage was not available in similar circumstances, Alpina moved for a summary judgment dismissing the claim as against it.
Held, the motion for summary judgment should be allowed.
There are different approaches about whether a judge is bound to follow the decision of another judge of the same court. A strict or authoritative approach is that the doctrine of stare decisis requires that a judge is required to apply the law as previously stated by his or her court. Although the authoritative approach provides certainty in the law, it is unnecessarily restrictive, particularly in situations where a previous decision was given without consideration of a statute or relevant case law. The least restrictive and more flexible approach was that judges ought to follow decisions out of judicial comity and only depart from them when they are wrong. The problem with this flexible approach was that it lacked criteria for determining when a previous decision was wrong. Between these approaches lies the proposition that a previous decision should be followed unless there was some indication that the decision was given without consideration of the appropriate statute or that relevant case law was not considered. The criteria did not exist in the present case and, as such, Despotopoulos v. Jackson was binding. Accordingly, the insurer's motion for summary judgment should be granted.
MOTION for summary judgment.
Cases referred to Despotopoulos v. Jackson,  I.L.R. Â1-2793 (Ont. Gen. Div.); Hansard Spruce Mills Ltd. (Re), reflex,  4 D.L.R. 590, 13 W.W.R. (N.S.) 285, 34 C.B.R. 202 (B.C.S.C.); Police Authority for Huddersfield v. Watson, reflex,  1 K.B. 842; R. v. Groves (1977), 1977 CanLII 1045 (ON SC), 17 O.R. (2d) 65, 79 D.L.R. (3d) 561, 37 C.C.C. (2d) 429, 39 C.R.N.S. 366 (H.C.J.); R. v. Kartna, reflex,  O.J. No. 143 (QL), 2 M.V.R. 259 (H.C.J.); R. v. Northern Electric Co. Ltd., reflex,  O.R. 431, 3 D.L.R. 449, 111 C.C.C. 241, 241 C.P.R. 1, 21 C.R. 45 (H.C.J.); Sedziak v. Polish Workers' Association, reflex,  4 D.L.R. 672,  3 W.W.R. 527, reflex, 45 Man. R. 425 (K.B.); Torrance v. Torrance,  I.L.R. Â1-2498, reflex, 41 C.C.L.I. 218,  O.J. No. 1412 (QL) (H.C.J.) Rules and regulations referred to Rules of Civil Procedure, R.R.O. 1990, Reg. 194, rule 20.01(3) Authorities referred to Gall, G., The Canadian Legal System (Toronto: Carswell, 1977) Williams, G., Learning the Law, 9th ed. (London: Stevens, 1973)
Jeffrey M.K. Garrett, for plaintiffs.
Michael E. Girard, for defendant Alpina Insurance Company of
Jane F. Cavanagh, for defendant Allstate Insurance Company.
GRANGER J.:-- The parties are in agreement that as both motions contain common issues of law, they should be heard together. In both motions, the insurer defendant seeks summary judgment dismissing the action against it pursuant to rule 20.01(3) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194.
The Holmes Action
On February 23, 1991, Heather Fiona Holmes ("Holmes") was a passenger in a motor vehicle operated by the defendant Theresa Jarrett ("Jarrett") which was involved in a collision with a motor vehicle operated by Karen Heather Gagnon, deceased. Jeananne Mohr, Debra McFadden, Bradley Czupryna and Laura Fryfogel were passengers in the rear seat of the Jarrett motor vehicle. The statement of claim issued by Holmes alleges that the collision and resulting damages were either as a result of the negligence of Jarrett and/or Gagnon. The only allegation against Alpina Insurance Company of Canada ("Alpina") is contained in para. 6 of the statement of claim which provides:
. . . Alpina insured Heather Fiona Holmes and said policy provided by way of the Underinsured Motorist's Endorsement S.E.F. Number 44 incorporated into and forming part of the insurance policy with additional insurance to "insured persons" who might be injured in motor vehicle accidents involving third party motor vehicles having insufficient automobile insurance to satisfy claims arising from the aforesaid motor vehicle accidents.
The defendant, Jarrett, admits that she was insured under a valid motor vehicle liability policy at the time of the motor vehicle collision. Gagnon admits that she was insured under a valid motor vehicle liability policy at the time of the accident. The Section A limits of the motor vehicle liability policy of the defendant, Jarrett, were $1 million at the time of the accident. The Section A limits of the motor vehicle liability policy of the defendant Gagnon were $1 million at the time of the accident. The Section A limits of the motor vehicle liability policy issued by Alpina to Holmes were $1 million at the time of the accident. The limits of the Family Protection Coverage under the said policy was also $1 million.
The O.E.F. 44 Family Protection Endorsement of the Holmes policy defined "inadequately insured motorist" in para. 1.5 as follows:
(a) the identified owner or identified driver of an automobile for which the total motor vehicle liability insurance or bonds, cash deposits or other financial guarantees as required by law in lieu of insurance, obtained by the owner or driver is less than the limit of family protection coverage; or [page670]
Under the O.E.F. 44 Family Protection Endorsement, the defendant Alpina takes the position that its maximum liability, regardless of the number of eligible claimants or insured persons injured or lulled or the number of automobiles insured under the policy, is the amount by which the limit of family protection coverage exceeds the total of all limits of motor vehicle liability insurance of the inadequately insured motorist and of any person jointly liable with that motorist.
Alpina argues that there are only two potential "inadequately insured motorists", being Jarrett or Gagnon. In order to be an "inadequately insured motorist", Jarrett would have to have motor vehicle liability insurance which is less than the limit of the family protection coverage available to Holmes and, accordingly, Jarrett is not an inadequately insured motorist as defined in the policy. The same considerations apply to Gagnon and, accordingly, the insured under the Gagnon policy is not an "inadequately insured motorist" as defined in the Holmes' policy.
Alpina submits that the action should be dismissed as there are no "inadequately insured motorists" and, accordingly, Holmes, is not in a position to claim under the O.E.F. 44 Family Protection Endorsement.
Mr. Garrett, on behalf of Holmes, submits that the words "total motor vehicle liability insurance" found in para. 1.5(a) of the O.E.F. 44 Family Protection Endorsement means the insurance funds available to the plaintiff to satisfy her claim. In this case, Mr. Garrett argues that as there are other seriously injured occupants in the Jarrett motor vehicle there will not be $1 million of insurance available to satisfy the claim of Holmes and accordingly, either Jarrett and/or Gagnon could be "an inadequately insured motorist" in so far as this plaintiff is concerned.
The Pisek Action
The plaintiff Milada Pisek ("Pisek") has instituted an action for damages against Carol Patterson ("Patterson"). The action is based on the negligent operation of a motor vehicle by Patterson. The Part A limits of the Patterson policy of insurance are $500,000. The O.E.F. 44 limits of the Pisek policy of insurance with Allstate Insurance Company ("Allstate") are $500,000. There are other claimants arising from the negligence of Patterson against her $500,000 of insurance. Accordingly, by the amount of insurance available to satisfy the claim of Pisek will be substantially less than $500,000.
Allstate submits that the action should be dismissed as there are no "inadequately insured motorists" and accordingly, Pisek [page671] is not in a position to claim under the O.E.F. 44 Family Protection Endorsement.
In Despotopoulos v. Jackson,  I.L.R. Â1-2793 (Ont. Gen. Div.), released September 5, 1991, Rutherford J. in dealing with a similar motion stated, at pp. 1646-47 I.L.R.:
The accident involved a collision between a 1982 Ford automobile owned and operated by the defendant, Donald Jackson ("Jackson") and a 1980 Dodge van owned and operated by one of the plaintiffs, Pavlos Romas ("Romas").
At the time of the accident, there were three passengers in the Romas motor vehicle: the plaintiff Emmanuel Despotopoulos
("Despotopoulos"), deceased, who was a front seat passenger, and the plaintiffs Dr. Ralph Lacroce ("Lacroce") and Vasia Bill Stefou ("Stefou"), who were both back seat passengers. There were no passengers in the Jackson motor vehicle.
Each of the actions involve serious personal injury claims on behalf of the passengers of the Romas motor vehicle, namely Romas, Despotopoulos, Stefou and Lacroce, and their family members pursuant to the Family Law Act. Although Romas had originally been named as one of the defendants, the claims against him have been dismissed on the basis that Jackson is 100 [per cent] at fault for the automobile accident.
At the time of the accident, the Jackson motor vehicle was insured under Guaranty of North America Insurance Company policy no. 172435 (the "Jackson policy"), having a third party liability policy limit of $1,000,000.
The plaintiffs agree that the aggregate of their claims are well in excess of the $1,000,000. third party liability coverage available under the Jackson policy and that they will ultimately be required to share the $1,000,000. on a pro-rated basis. The plaintiffs also agree that this pro- rated distribution will result in a shortfall in payment of the full amount of damages to which they would otherwise be entitled.
The issue in this motion is whether the plaintiffs are entitled to recover the indemnity for their under insured losses pursuant to the SEF 44 coverage contained in their various automobile policies of insurance. To determine this issue, I propose to consider the following:
(i) the purpose of SEF 44 coverage;
(ii) the limits of coverage under SEF 44; and
(iii) the proper construction of SEF 44.
Rutherford J. continued at pp. 1647-48:
It is the plaintiffs' position therefore that notwithstanding the number of claimants in these actions, they should each be entitled to recover at least $1,000,000. in damages. To support this position, the plaintiffs submit that para. 3(a) of SEF 44, the limit of coverage under the endorsement, is ambiguous and that the ambiguity should be resolved in their favour.
The various insurance companies which are defending these actions, however, submit that paragraph 3(a) is clear and unambiguous and that [page672] coverage is clearly precluded in circumstances where an insured's SEF 44 coverage does not exceed the negligent driver's third party liability coverage. This construction, in their submission, arises from the plain meaning of the words in paragraph 3(a) and is consistent with the definition of "inadequately insured motorist" in paragraph 1(e).
In my view, although the wording of SEF 44 must be read carefully, it is not ambiguous. As a result, the cases referred to by the plaintiffs which deal with the construction of an ambiguity against an insurer are irrelevant and do not apply. Chadwick J. reached the same conclusion in Torrance, supra, when he refused to allow the plaintiff to stack her SEF 44 coverage on top of the limit of liability insurance coverage on the basis that the SEF 44 endorsement expressly provided that its limits would not be stacked on top of any liability limits.
In the Torrance case, Laurie Torrance had been a passenger in her husband's pickup truck when he negligently failed to stop at a stop sign and entered the east ditch of the roadway. Laurie suffered a fractured dislocation of her vertebrae with a motor and sensory quadriplegia. The truck was insured under a standard automobile policy of insurance and included SEF 44 coverage. Although no express amount was set out in the policy with respect to the SEF 44 coverage, the endorsement provided that its limit would be equal to the Section A limit, which was $500,000. Since the SEF 44 limit did not exceed the liability limit as prescribed in section 3(a) of the SEF 44. Laurie could only recover $500,000. from her husband's insurer and not $1,000,000.
The case at bar is similar to Torrance in that the limit of liability coverage in the Jackson policy is equal to the limit of SEF 44 coverage in each of the SEF 44 endorsements available to the plaintiffs. However, unlike Torrance, which involved a single plaintiff who was solely entitled to the $500,000 under her husband's insurance policy, there are multiple claimants in this case who have to share the defendant Jackson's $1,000,000. However, the fact that the plaintiffs in these actions will recover less than would be recovered if there was only one plaintiff does not entitle them to SEF coverage. As Flaherty emphasizes at page 12 of his paper, the section 3(a) formula applies regardless of the number of claimants.
That SEF 44 coverage is unavailable in this case does not render the plaintiffs' insurance policies illusory or absurd. SEF 44 coverage was designed to protect insureds from inadequately insured tortfeasors and was never intended to protect insureds and their families from adequate insured motorists like the defendant Jackson and Laurie Torrance's negligent husband in the Torrance case. Jackson is and was at the time of the accident an adequately insured motorist within the meaning of paragraph 1(e) of the endorsement. That he happened to strike a vehicle containing more than one passenger and that multiple claimants are now forced to share his liability insurance coverage was purely fortuitous and does not change the fact that he was adequately insured within the meaning of the endorsement at the time of the accident.
For the reasons mentioned above, the answer to the question of law put before me by the plaintiffs is "No" -- the plaintiffs are not entitled to recover the shortfall in monies available to satisfy their claims against Jackson from the SEF 44 endorsements contained in their automobile insurance policies. Accordingly, the plaintiffs' claims against their own insurers for SEF 44 coverage are dismissed. [page673]
Mr. Garrett suggests that I am not bound by the decisions of Rutherford J. in Despotopoulos and the decision of Chadwick J. in Torrance v. Torrance (1989), reflex, 41 C.C.L.I. 218,  O.J. No. 1412 (QL) (H.C.J.). In 1990, the Ontario Legislature created the Ontario Court of Justice (General Division), which is the largest superior court in Canada, with approximately 250 justices exercising responsibilities in the 50 dispersed judicial centres within the eight judicial regions of the province. In my opinion, it is desirable to develop certainty in the law throughout the court. I intend to review what means exist which would permit members of the judiciary to discharge their responsibilities within the context of the principles of judicial independence while avoiding individual or regional developments in the law. One approach is to employ the rule or doctrine of stare decisis. The phrase stare decisis is an abbreviation of the Latin phrase stare decisis et non quieta movere may be translated as "to by decisions and not to disturb settled matters". The "rule" as it is often described, has been commonly understood in modern terms to mean that every court is bound to follow any case decided by a court above it in the hierarchy. However, as the entire phrase itself suggests, the "doctrine of stare decisis also requires that cases be decided the same way when their material facts are the same":
see Glanville Williams, Learning the Law, 9th ed (London:
The employment of the rule of stare decisis has been necessary to ensure uniformity in the development of the law, and thereby ultimately encourage the predictability of decisions in a meaningful understanding of the law. As a result, it has been said that the primary reasons for the development of the doctrine can be stated as follows:
(1) To provide for certainty and predictability in the law;
(See Gall, G., The Canadian Legal System, Toronto: Carswell, 1977).
Several judicial decisions have offered somewhat differing views as to whether or not judges of the same court are bound or required as a matter of course to follow what has been previously decided in that court by another judge.
The authoritative view
Some judges have adopted what may be described as a very strict and traditional view of the doctrine stating that judges of [page674] the same court are required to apply the law as previously stated by their court. They have subscribed to the view that these decisions are authoritative. In Sedziak v. Polish Worker's Association, reflex,  4 D.L.R. 672,  3 W.W.R. 527 (Man. K.B.), it was said that a judgment of a judge of the Court of King's Bench is binding on that court until altered by the Court of Appeal. In R. v. Kartna, reflex,  O.J. No. 143 (QL), 2 M.V.R. 259 (H.C.J.), the accused argued that the information charging him with having committed an offence was technically invalid. He relied upon a District Court decision that was directly opposite to the conclusion of another District Court decision in the same judicial district. The two District Court decisions were reached only a few weeks apart. Although it was not necessary to do so for the determination of the appeal, Hughes J. stated, at p. 267 M.V.R.:
I pause here to say, with deference but emphatically, that in my view it is unfortunate that such a disagreement with a Judge of coordinate jurisdiction was indulged in by Forget D.C.J. In the case of Vaughan. I will go further and say that the proper procedure, and one without the recognition of which the administration of justice would fall into disrepute and disarray, is for a Judge in his position to consider himself bound by what has been decided before in his own Court. Such is the rule of stare decisis. He may, of course, express his disagreement as trenchantly as he likes, but should leave the question which vexes him to the Court of Appeal for such decision as may be appropriate. In default of observing this time-honoured procedure and in the absence of appeal (as I am advised by Crown counsel is the case here) one accused is convicted and the other in precisely the same circumstances is acquitted of the same charge with concomitant uncertainty and potential scandal.
The persuasive view
The proposition that judges of the same court are bound to follow one another has been indirectly criticized as being unnecessarily restrictive in the following statement of Lord Goddard C.J. contained in Police Authority for Huddersfield v. Watson, reflex,  1 K.B. 842, at p. 848:
. . . I think the modern practice, and the modem view of the subject, is that a judge of first instance, though he would always follow the decision of another judge of first instance, unless he is convinced the judgment is wrong, would follow it as a matter of judicial comity. He certainly is not bound to follow the decision of a judge of equal jurisdiction. He is only bound to follow the decisions which are binding on him, which, in the case of a judge of first instance, are the decisions of the Court of Appeal, the House of Lords and the Divisional Court.
This statement of Lord Goddard C.J. was cited with approval in R. v. Groves (1977), 1977 CanLII 1045 (ON SC), 17 O.R. (2d) 65, 79 D.L.R. (3d) 561 (H.C.J.). The foundation of the persuasive view is that the authoritative view is premised on the notion that stare decisis is a rule which [page675] obliges a judge to follow a particular course of action. Such an obligation, it is argued, must arise from a source outside the person or entity whose conduct is to be directed. According to the persuasive view, such a rule does not exist, and therefore the phrase stare decisis is merely a convenient way of expressing the tradition which has developed within our judicial system that certain courts will follow decisions of other courts. Compliance with this custom, it is said, may be viewed more as judicial comity than forced adherence. Courts higher in the hierarchical structure are followed to avoid the embarrassment of being overturned on appeal. This modern view is prepared to make exceptions when a judgment is wrong because there is nothing requiring the judges to comply with the previous decision.
The conformity view
This view suggests that judges ought to follow previous decisions of their colleagues unless certain specific situations exist. In Re Hansard Spruce Mills Ltd., reflex,  4 D.L.R. 590, 13 W.W.R. (N.S.) 285 (B.C.S.C.), Wilson J. stated, at p. 286 W.W.R.:
But, as I said in the Cairney case, I think the power, or rather the proper discretionary duty, of a trial judge is more limited. The Court of Appeal, by overriding itself in Bell v. Klein, has settled the law. But I have no power to override a brother judge, I can only differ from him, and the effect of my doing so is not to settle but rather to unsettle the law, because, following such a difference of opinion, the unhappy litigant is confronted with conflicting opinions emanating from the same court and therefore of the same legal weight. That is the state of affairs which cannot develop in the Court of Appeal.
Therefore, to epitomize what I have already written in the Cairney case, I say this: I will only go against a judgment of another judge of this court if:
(a) Subsequent decisions have affected the validity of the impugned judgment;
(b) It is demonstrated that some binding authority in case law or some relevant statute was not considered;
(c) The judgment was unconsidered, a nisi prius judgment given in circumstances familiar with all trial judges, where the exigencies of the trial require an immediate decision without opportunity to fully consult authority.
If none of these situations exists, I think a trial judge should follow the decisions of his brother judges.
In R. v. Northern Electric Co. Ltd., reflex,  O.R. 431,  3 D.L.R. 449 (H.C.J.), McRuer C.J.H.C. stated, at p. 448 O.R., p. 466 D.L.R.:
Having regard to all the rights of appeal that now exist in Ontario, I think Hogg J. stated the right common law principle to be applied in his judgment [page676] in R. ex rel. McWilliam v. Morris, reflex,  O.W.N. 447 . . . where he said: "The doctrine of stare decisis is one long recognized as a principle of our law. Sir Frederick Pollock says, in his First Book of Jurisprudence, 6th ed., p. 321: The decisions of an ordinary superior court are binding on all courts of inferior rank within the same jurisdiction, and, though not absolutely binding on courts of co-ordinate authority nor on that court itself will be followed in the absence of strong reasons to the contrary . . .".
I think that "strong reason to the contrary" does not mean a strong argumentative reason appealing to the particular judge, but something that may indicate that the prior decision was given without consideration of a statute or some authority that ought to have been followed. I do not think "strong reason to the contrary" is to be construed according to the flexibility of the mind of the particular judge.
According to Chief Justice McRuer and Justice Wilson, the decisions of judges of coordinate courts are persuasive and should be given considerable weight unless there are very cogent reasons to depart from such decision.
The authoritative view requires judges to follow all previous decisions of their colleagues, allowing the Court of Appeal to correct any error if necessary. Although this approach provides certainty in the law, it may be unnecessarily restrictive, particularly in situations where the previous decisions were given without consideration of a [statute] or relevant case law.
On the other hand, the least restrictive view as represented by the position of Lord Goddard suggests that judges ought to follow decisions of their colleagues out of judicial comity and only depart from them when they are wrong. While the flexibility shown in this approach is more preferable to the restrictive opinion, it fails to provide any criteria to determine when it can be said that a previous decision was wrong. If it only requires a difference of opinion about the law to permit a judge to depart from previous decisions, then the concerns raised by Hughes J. in Kartna may be relevant.
Between these two views lies the proposition as put forward by Justice Wilson and Chief Justice McRuer that judges ought to feel bound to follow previous decisions of their colleagues, unless certain factors exist to persuade them to decide the case differently. In my opinion, that as it now takes approximately 30 months for the Court of Appeal to review a decision, it is imperative that as much certainty be brought to the law as possible until the Court of Appeal rules on a point and this can be best achieved by following the approach as set out by Chief Justice McRuer.
Accordingly, I must follow the judgments of Rutherford J. and Chadwick J. in Despotopoulos and Torrance unless there is some indication that their decisions were given without consideration [page677] of the appropriate statute or that they failed to consider some relevant caselaw.
In my view, the criteria for failing to follow a judgment of a coordinate court does not exist in this case and I feel bound by the decision of Rutherford J. in Despotopoulos. I might also add that I agree with the decision of Rutherford J. Accordingly the actions against Alpina and Allstate are dismissed.
Counsel may make written submissions on costs within 30 days.
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