In Giustini v. Poppa, Mr. Justice Thomas Lofchik dismissed a motion for summary judgment by Goodyear Tire and other defendants, who had argued that a claim against them was barred by the two-year limitation period in the Highway Traffic Act.
The action arose out of a 1999 motor vehicle accident in which the brake system failed on a Ford Aerostar. The action was commenced within two years of the accident. But afterwards, counsel for the plaintiffs obtained an expert’s report that indicated that the accident had been caused by an improperly-designed brake hose on the vehicle.
The plaintiffs moved without notice to add as defendants Goodyear Tire and Rubber Company and Dana Corporation, alleging that one of them had designed and manufactured the faulty brake hose. The Highway Traffic Act limitation period had long since lapsed. The new defendants then moved for summary judgment, arguing that the action against them was prescribed.
The defendants relied on Karakas v. General Motors of Canada (upheld by the Court of Appeal). The plaintiffs in that case alleged that a fire that had damaged their home had been caused by defective wiring in an automobile that had been parked in the garage. But they had commenced the action more than two years after the fire. The defendants had argued that the action was barred by the Highway Traffic Act limitation period.
The court in Karakas considered the leading case, the Supreme Court of Canada’s decision in Heredi v. Fensom, and concluded that Heredi mandated a “substantive approach” be taken: claims where the presence of a motor vehicle is a fact ancillary to the essence of the action would not fall within the scope of the HTA limitation period. But the court in Karakas, applying that “substantive approach”, held that “the motor vehicle is not only the dominant but also the only feature in the claim for damages. The very presence of the motor vehicle and the alleged defect in the motor vehicle are central to and the essence of the claim. Applying the Supreme Court of Canada’s substantive approach I conclude that the claim is one for ‘damages occasioned by a motor vehicle’ and it is statute barred.” The Court of Appeal agreed with the reasons of the motions judge.
Given the finding in Karakas, where the vehicle in question was parked in the garage, it was probably reasonable for the defendants in Giustini to expect the same outcome. After all, the vehicle in Karakas was being driven on a highway at the time of the event giving rise to the claim.But Justice Lofchik relied on yet another case, the Court of Appeal’s 2006 decision in Guarantee Co. of North America v. Mercedes-Benz Canada Inc., for the proposition that Karakas might be “at odds” with Heredi. In a brief endorsement, the Court of Appeal in Guarantee said that there was “arguable merit” to the proposition that Karakas and Heredi were at odds with each other but since it had not been asked to overrule Karakas, it had not done so.
Justice Lofchik felt that the door had been left open to argue that the two cases were in conflict. As a result, he held that “it is open to the trial judge to characterize this action as a negligent manufacture case on the facts and to apply the six year limitation period.”
It may only be a matter of time before someone does invite the Court of Appeal to overrule Karakas. But since the limitation period for negligent design and manufacture of an automobile’s components is now the same as the limitation period for negligent operation of that automobile (two years), the number of cases in which the argument could conceivably be made is decreasing daily.