Vlanich v. Typhair, 2016 ONCA 517 (CanLII)

Township not liable to injured plaintiffs for failing to enforce taxi insurance bylaw.

Released June 29, 2016 | Full Decision [CanLII]

The Court of Appeal concluded that a municipality is not liable in negligence for losses suffered as a result of a collision with a taxi that was inadequately insured in violation of the municipality’s taxi licencing bylaw. Sheileena Mallette and Kaitland Vlanich were injured in a motor vehicle accident involving a taxi cab. The taxi cab only carried $200,000 in auto liability insurance coverage notwithstanding a bylaw in the Township of North-Grenville (the “Township”) that required all taxis in the Township to carry at least $1,000,000 in auto liability coverage. All taxi’s and vehicles which generate revenue from transporting people, should have livery insurance to protect against injury, vehicle and property, in the event of an accident.

Mallette and Vlanich sued State Farm Mutual Automobile Insurance Company (“State Farm”) under their OPCF 44R Family Protection Coverage endorsement on the basis that the at-fault motorist was underinsured. They also sued the Township for failing to enforce its own taxi insurance bylaw.

A modified summary trial proceeded with State Farm arguing that the Township ought to be liable to the plaintiffs for their losses above $200,000 due to its failure to enforce its own bylaw. The injured plaintiffs did not participate in the trial. The trial judge found that, although the Township owed the injured parties a duty of care, the Township did not fall below the standard of care in enforcing the Bylaw. State Farm appealed. The injured plaintiffs intervened and supported State Farm’s position on the appeal.

Sharpe J.A., writing for a unanimous panel, dismissed the appeal. The Court held that the trial judge erred in finding that the Township owed the injured plaintiffs a private law duty of care. Sharpe J.A. held that a public authority administering a licencing scheme owes a general duty to the public at large to ensure compliance with the regulatory scheme. However, that general public duty is not equivalent to a private law duty of care. Without “something more”, licencing a third party does not create a “close and direct” relationship capable of giving rise to a duty of care between a public authority and an individual member of the public who may interact with a licensee.

The Court of Appeal also went on to hold that residual policy considerations militate against the recognition of a duty of care in this case. Sharpe J.A. also agreed with the trial judge that the Township had not breached the standard of care in this case.

The appeal was dismissed with costs to the Township fixed at $12,500 inclusive of disbursements and taxes, payable by State Farm.


State Farm’s counsel: Chris G. Paliare and Tina H. Lie

Township’s counsel: Mark Charron and Stephanie Doucet

Plaintiffs’ counsel: Lawrence Greenspon and Marisa Victor


Read the full decision on CanLII
Written by

A partner at Oatley Vigmond, Ryan joined the firm in 2006 shortly after he was called to the bar in 2005. Ryan holds an Honours B.A. from York University, as well as a Bachelor of Laws (LL.B.) and a Master of Laws (LL.M.) (Civil Litigation and Dispute Resolution) from Osgoode Hall Law School.

When Ryan is not practicing law, he enjoys golfing and spending quality time with his wife and two young children.