July 21, 2014

SABS Update – Suspended Licence? You Can’t Bury Your Head in the Sand

Leduc v. Aviva, FSCO A12-001105, June 25, 2014, Arbitrator Pamila Ahlfeld

MVC April 12, 2009. The Applicant, Joseph Leduc (Leduc), applied for accident benefits from his insurer, Aviva. Aviva denied payment of Income Replacement Benefits (IRB) and Housekeeping and Home Maintenance Expenses (HKHM) due to the fact Leduc was driving with a suspended licence at the time of the accident. Mediation failed, and Leduc applied for arbitration.

At the hearing of the preliminary issue, Arbitrator Ahlfeld concluded Leduc was precluded from proceeding to arbitration.

At the hearing, Leduc testified he was unaware his driver’s licence was suspended at the time of the MVC. Prior to the MVC, he received tickets for speeding and “something else” and gave his stepson $600.00 to pay the fines for him. He assumed his stepson paid the fines. After the MVC, his stepson confessed he used the money for himself. As a result of the MVC, Leduc was charged with a number of offences including driving with a suspended licence, pursuant to section 53 of the Highway Traffic Act (HTA).

At the hearing, Leduc’s stepson testified he used the money for himself, but led Leduc to believe he used the money to pay the fines. He only told Leduc the truth after the MVC.

Leduc hired an agent to defend the HTA charges he received as a result of the MVC. Unbeknownst to Leduc, the agent pled guilty to two of the charges, one of which was driving with “no [driver’s] licence or improper class of licence”. Leduc was convicted of that charge on May 20, 2010. At the hearing, the agent testified he did not discuss the guilty plea with Leduc. He sent a letter to Leduc informing him the fine had to be paid within 60 days of the conviction date. When Leduc learned of the guilty plea, he told the agent he wanted to speak to the prosecutor himself. The agent thought Leduc might have taken his file back. Leduc did not ask him to appeal the conviction.

Arbitrator Ahlfeld concluded that, at the time of the MVC, Leduc was driving without a valid driver’s licence as defined by section 30 of the SABS:

The insurer is not required to pay an income replacement benefit, a non-earner benefit or a benefit under section 20, 21 or 22 in respect of a person who was the driver of an automobile at the time of the accident,

(a) If the driver knew or ought reasonably to have known that he or she was operating the automobile while it was not insured under a motor vehicle liability policy;

(b) If the driver was driving the automobile without a valid driver’s licence;

(c) If the driver is an excluded driver under the contract of automobile insurance; or

(d) If the driver knew or ought reasonably to have known that he or she was operating the automobile without the owner’s consent.

“Valid driver’s licence” means a driver’s licence that is not expired, cancelled or under suspension.

The Arbitrator noted that while subsections (a) and (d) make clear knowledge is a relevant consideration under those subsections, subsection (b) is silent with respect to knowledge. Given the drafters included knowledge as an element in subsections (a) and (d), if the drafters intended knowledge to be an element of subsection (b), it would have been included.

In spite of section 30, a defence of due diligence may be available in certain circumstances. Citing the Supreme Court of Canada in R. v. City of Sault Ste. Marie and later in Levis (City) v. Tetreault:

The defence will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event.

The concept of diligence is based on the acceptance of a citizen’s civic duty to take action to find out what his or her obligations are. Passive ignorance is not a valid defence in criminal law.

Leduc relied on due diligence to argue he did not know his licence was suspended at the time of the MVC. The Arbitrator found there was no persuasive evidence Leduc, in fact, exercised due diligence.


If faced with a case where the insured was driving with a suspended licence at the time of the MVC, it will be important to gather as much information as possible, as soon after the MVC as possible, as to what the insured knew and when about the suspension, and what actions the insured took in response. Evidence of diligence will be crucial to proving due diligence.

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