Liabilities When Another Person Borrows Your Car and Causes an Accident

A vehicle owner is generally held responsible for any injuries or damages that are caused by someone driving their vehicle.  When the ‘at fault’ driver (including the owner’s children or another person) has been found guilty of a driving-related violation in connection with the accident - such as failing to yield, speeding, disobeying a red light, careless driving or drunk driving - the vehicle owner can be held liable for injuries and losses caused to an innocent person.   

Ontario’s Highway Traffic Act, s.192 states: The owner of a motor vehicle or street car is liable for loss or damage sustained by any person by reason of negligence in the operation of the motor vehicle or street car on a highway, unless the motor vehicle or street car was without the owner’s consent in the possession of some person other than the owner or the owner’s chauffeur. 

This means that a vehicle owner might not be held liable for a driver’s negligence when the driver took the car without the owner’s permission.  However, vehicle owners are ‘vicariously liable’ for damages caused by their vehicle when there is either ‘expressed consent’ or ‘implied consent’.  For example, your child, a friend or another person might have reason to believe they have implied consent to borrow your car because they were given permission to drive the vehicle at some time in the past.  In cases where a vehicle owner is claiming that their vehicle was taken without their permission, they may be required to prove that the driver did not have ‘implied consent’. 

In the civil action, Palsky (Next friend of) v. Humphrey, the trial judge found the vehicle owner liable for a wrongful death when the driver who committed the negligent action was found to have the owner’s implied consent.  In the 1964 appeal of this case, the Supreme Court of Canada agreed with the trial judge’s decision and stated that the test for ‘implied consent’ requires answering the question whether “all the circumstances were such as would show that the person who was driving had the implied consent of the owner”.   

The question of whether a driver had ‘implied consent’ to drive has been put to the test in multiple Ontario court cases and the decisions have varied, depending on the specific circumstances of each case.

Michaud-Shields v. Gough (2018) is a personal injury lawsuit that was brought after a plaintiff was injured in a head on collision. The accident resulted when the at fault driver, Justin Gough (who lived with his parents at the time), took the keys for his parent’s pickup truck while they were away, despite knowing that he was not supposed to take the truck.  Justin was charged with several offences in connection with the collision, including impaired driving. When Justin’s parents returned home and found out about the accident, an OPP officer suggested they not press charges against Justin for stealing the truck because the young man was already facing several charges, and Ms. Gough followed the officer’s advice.

The driver’s mother, who is the owner of the vehicle, was included as a defendant in the action, as was the plaintiff’s insurance company, Compagnie d’Assurance Traders Generale (‘Traders’), pursuant to uninsured automobile coverage.  In Michaud-Shields v. Gough, ‘Traders’ made a motion for summary judgement to remove them as a defendant in this case, arguing that Justin had taken the vehicle with his mother’s ‘implied consent’ and therefore, Ms. Gough must be held vicariously liable for her son’s actions and Traders should be released from the lawsuit. 

At the time of the accident, Justin’s licence had been suspended for seven years and Ms. Gough was the only licenced and insured driver in the home.  The truck originally belonged to Justin but after his licence was suspended and the truck sat unused in the driveway for several years, ownership of the truck was transferred to Ms. Gough.  Justin had never asked his mother for permission to use the pickup truck or her other vehicle, and it was understood by both parties that he couldn’t resume driving until his licence was reinstated.  While residing at his parent’s home, Justin had never behaved irresponsibly or did anything to cause her to think that there was a risk that he might take one of the vehicles.  Also, Justin testified that he drove the vehicle without his mother’s consent and he felt very sorry for doing so.  

Traders argued that Ms. Gough did not expressly forbid Justin to drive her truck while she was away and as the keys were left on a hook in the home, she also did not take actions to prevent him from using the vehicle, and because Justin had ‘possession’ of the vehicle, Ms. Gough should be liable while the truck was in his possession.  ‘Traders’ referenced Fernandes v. Araujo where the Court referred to Finlayson and noted, “Where the owner gives possession for the vehicle, “[b]beach of conditions placed by the owner on another person’s possession of the vehicle …do not alter the fact of the second person’s possession” and from possession flows liability”.  

The judge in the current case found that the above interpretation of consent is too broad and disagreed with Traders’ argument that owners are liable for an accident unless steps are taken to prevent unauthorized use of their vehicle.  The judge ruled that the evidence supports a finding that no consent was given to Justin to drive the truck.

Nemeth v. Yasin (2015) is another lawsuit that rested on whether a vehicle was taken with or without the owner’s consent.  In this instance, unlike the previous case, the judge ruled that the vehicle owner was, in fact, vicariously liable for his son’s accident because the owner failed to prove that the car was in his son’s possession without his permission.  In Nemeth, the son (Wais Yasin) took his father’s car to pick up his mother from the mall, despite having been told by his father that he can never drive any of the family vehicles (a fact that his mother apparently did not know).  On route to the mall, he was involved in a fender bender, which led to a personal injury lawsuit naming the son and his father, the owner of the vehicle, as defendants.

Due to a poor driving record, Wais had been removed from his father’s vehicle insurance policy and had signed an OPCF-28 Excluded Driver Form which was submitted to the insurer.  The young man was also made aware that he could only drive again if he paid for his own insurance.  As in the Gough case, the car keys were kept in an easily accessible location in the house. 

The judge in Nemeth found that the boy’s father imposed a condition on the operation of the family car but not on its possession, so “the vehicle was still there for the taking” by Wais.  Further, the Insurance Act imposes a responsibility on vehicle owners “of careful management and of assuming the risk of those to who the owner entrusts possession”.

The lesson to be taken from these and other cases is that, as the owner of a vehicle, the onus is on you to guard against giving the impression that it is okay to borrow your car without your express ‘say-so’, even to your own children.  Be aware that your vehicle insurance company can refuse to pay your claim if the borrower was impaired or had a suspended licence when they caused the accident, or if the terms of your insurance policy exclude them from driving.

When you apply for vehicle insurance, you are obligated to inform your insurance company of any family members living in your household who might drive the vehicle.  One of the reasons for this requirement from the insurer’s standpoint, is that your insurance premiums will typically be higher if a young and inexperienced driver is, even occasionally, driving your car.  If you fail to disclose this information and the family member causes an accident, your insurer may refuse to pay the claim.

If you were hurt in a motor vehicle accident involving a borrowed car and are considering bringing a lawsuit against the at fault driver, talk to an experienced car accident lawyer at Dietrich Law.  We welcome your questions and can offer candid advice on the strength of your claim and the steps involved in obtaining fair compensation for your injury.