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Whose Insurance Pays for an Accident Involving Multiple Negligent Parties?

A car accident may have multiple victims, each of whom is entitled to recover damages against a negligent party. Sorting out all of these claims can take many years and require multiple judicial proceedings. This is why it is so important to work with an Ontario personal injury lawyer even before you speak with an insurance company to discuss a potential settlement of accident-related claims. Throwing in multiple negligent parties will only complicate the issue further; here’s what to watch for.

Case Study: House v. Baird

To give you some idea of how long some personal injury cases can run, an Ontario Superior Court judge recently ruled on a post-trial motion involving an accident that took place nearly 10 years ago. This particular lawsuit, House v. Baird, involves a tragic accident that occurred–as sadly too many accidents in Ontario do–on a winter’s night when road conditions were less than ideal.

The Details of the Accident

According to news reports and court records, the accident took place around 9p.m. on the evening of February 25, 2009. The plaintiff, a man named House, was driving a car that belonged to the defendant, a man named Baird. House and Baird were both in the car at the time along with two other men, one of whom was named Samms. It was snowing “quite a bit” that night, according to Baird.

The car travelled on Huron Road in Kitchener. As described by the Ontario Court of Appeal in a 2017 judgment, “In the Township of Wilmot, just west of the intersection with Pinehills Road, Huron Road takes a long descent leading to a dip in the road, then a crest, followed by a further descent.” House lost control of the car “at or close to” this crest. The vehicle then slid into the opposite lane and “continued downhill” going west, where it eventually hit another car driven by a man named Murray.

To be more precise, the front of Murray’s vehicle hit the rear passenger side of the car House was driving, which killed Samms and seriously injured both House and Baird, the car’s owner. (The fourth passenger in the House vehicle was also injured, but apparently “less seriously” according to the Court of Appeal.)

The Personal Injury Claims

Multiple personal injury claims followed. Baird and the family of the deceased Samms sued House, Murray, and the Township of Wilmot. The claim against the Township was based on the allegation that Huron Road itself was slippery and possibly covered with ice at the time of the collision, which could make the Township at least partially liable.

Baird and the Samms family eventually settled their respective claims. The Samms family agreed to a settlement of $200,000. Baird agreed to a $500,000 settlement.

House then filed his own lawsuit against Baird, Murray, and the Township. Murray settled for $675,000. At trial, House then argued that Baird, as the car’s owner, failed to keep the vehicle in good condition prior to the accident. More specifically, House presented evidence that the rear tires on Baird’s car were “worn beyond acceptable limits,” and that the “front and rear tires were mismatched and over-inflated.”

The trial judge ultimately determined that House and Baird were equally responsible for the accident. The judge further absolved the other driver, Murray, and the Township of Wilmot of any liability. In the end, the court determined that House, who suffered a traumatic head injury in the accident, sustained total damages of $2.8 million. As House was 50% liable for the accident, that meant Baird was liable for half of the judgment, or roughly $1.4 million.

In the aforementioned 2017 decision, the Court of Appeal declined to disturb the trial judge’s decision. In that appeal, House maintained his liability was significantly less than 50% and that the Township should have been held partly responsible for the road conditions that night. The Court of Appeal disagreed.

The Insurance Battle

The Court of Appeal’s decision was not the final word in this litigation. As both Baird and House had insurance, there was a question over how to pay for not just House’s $1.4 judgment, but also the prior settlements of the Baird and Samms lawsuits. This culminated in a March 15, 2019, decision by Justice Catrina D. Braid of the Ontario Superior Court of Justice (not to be confused with the litigant Baird).

Essentially, Baird had a $1 million third-party liability policy from State Farm. House has a similar $1 million policy issued by Nordique Insurance. When Samms and Baird resolved their claims, they agreed that their settlements “would be prorated with the plaintiffs in the other actions.” They also agreed to be bound by whatever liability determinations were made by the judge in the House lawsuit.

What complicated things somewhat was the fact that House was driving Baird’s car at the time of the accident. This meant, according to Justice Braid, that Baird’s State Farm policy was the “first loss insurance” for this accident. In other words, the State Farm policy would be used first to pay off House’s judgment and the settlements. Since the total amount of liability exceeded $1 million, State Farm would have to make payouts on a pro rata basis. House’s own policy from Nordique would then be used as “excess insurance” to pay off whatever House owed to the Samms family and Baird. House would also be permitted to garnish 20% of any insurance money paid by State Farm or Nordique to Baird. Justice Braid left it to the parties to figure out the actual prorated figures among themselves, reserving the right to make a final determination in the event they failed to do so.

Contact Preszler Injury Lawyers Today if You Need Legal Advice Following a Toronto Car Accident

Sorting out the legal aftermath of an auto accident is often no simple task, especially when there are multiple parties (and insurance companies) involved. If you find yourself struggling to sort out the ramifications of your own accident, contact the lawyers at Preszler Injury Lawyers today to schedule a free, no-obligation consultation.


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