Case: Ernst v. Northbridge Personal Insurance Corporation, 2018 ONCA 339 (CanLII)

Keywords: Pleadings Rule; ATV; Off-Road Vehicles Act, R.S.O. 1990, CHAPTER O.4


The Appellant, Northbridge Personal Insurance Corporation, appeals from an Application Judge’s order requiring that it defend an action arising from an ATV accident. The Respondents (Greg Ernst, Laurie Ann Stewart, and Andrew Ernst) are in the process of purchasing both the ATV and the rural property where the accident takes place from another family at the time of the accident. The Plaintiff in that action is Andrew Ernst’s ATV passenger.

The Ernst’s automobile insurance policy extends coverage to an ATV if it is both owned by the Respondents and the Respondents are not occupiers of the property on which the accident occurs. The Appellant denies coverage on the basis that, because the ATV was being operated on private property, it would not fall under the definition of an “automobile” – that it should really be considered an “off-road vehicle” subject to the Off-Road Vehicles Act, R.S.O. 1990, CHAPTER O.4.

The Appellant argues that the application Judge misapplied the pleadings rule and “wrongly assumed” the Respondents could not be occupiers (and so could avail themselves of the insurance policy) because the other family were also occupiers of the property. The Court of Appeal disagrees; dismissing the Appellant’s appeal.


This case is significant because it provides a clear affirmation of the pleadings rule, which was set out by the Supreme Court of Canada in Monenco Ltd. v. Commonwealth Insurance Co., [2001] 2 S.C.R. 699, 2001 SCC 49 (CanLII) at para. 28,

The starting premise for assessing whether an insurer’s duty to defend has been triggered rests in the traditional “pleadings rule”. Whether an insurer is bound to defend a particular claim has been conventionally addressed by relying on the allegations made in the pleadings filed against the insured, usually in the form of a statement of claim. If the pleadings allege facts which, if true, would require the insurer to indemnify the insured for the claim, then the insurer is obliged to provide a defence. This remains so even though the actual facts may differ from the allegations pleaded.

For the Court of Appeal, the threshold is “not high” since, as stated in Monenco Ltd., “The mere possibility that a claim failing within the policy may succeed will suffice” to engage the Appellant’s obligation to indemnify. (See para. 7; Monenco Ltd. at para. 29).

From a practical point of view, the Court of Appeal acknowledged the statement of claim included allegations that,

  • the Respondents were owners of the ATV and occupiers of the property in question; and
  • the other family, the Hellers, were the owners of the ATV and occupiers of the property at the relevant time. (See para. 8).

For the Court of Appeal, there is “…no requirement that the allegations against the respondents be expressly pleaded in the alternative for the duty to defend to arise”. (See para. 8). In fact, as stated in Monenco Ltd. at para. 31, even in circumstances where pleadings are not framed with enough precision to determine whether the claims are covered by a policy, the insurer’s obligation to defend is triggered where “…on a reasonable reading of the pleadings, a claim within coverage can be inferred.”

In this case, the Court of Appeal found it was possible for more than one party to be the occupier of the property where the accident took place at the relevant time, the pleadings disclosed enough facts to permit the Application Judge’s conclusion that the Hellers and not the Respondents were occupiers (at the relevant time). As such, the Court of Appeal found there was a sufficient factual basis to trigger the Appellant’s duty to defend. (See para. 8).

Counsel for the Appellant: Andrew Evangelista and Jennifer Kent (Evangelista Barristers & Solicitors, Toronto)

Counsel for the Respondents: Gordon Marsden (Will Davidson LLP, Toronto)

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