Oct 28, 2020

Civil Litigation; Inference-Making by Trial Judges

Megaro v. Insurance Corporation of British Columbia, 2020 BCCA 273 (CanLII)

Keywords: MVA; vicarious liability; judicial inferences; hearsay


The Respondent, Matthew Vanstone’s Nissan car collides with a car driven by the Respondent, Giulio Megaro. Critically, Mr. Vanstone is neither the driver nor an occupant of the Nissan – its driver’s identity is not known, and, the “vehicle left the scene”. Mr. Megaro is seriously injured in the collision. He brings an action in negligence naming Mr. Vanstone, “John Doe”, the Insurance Corporation of British Columbia, and Varinder Khatra as defendants. Mr. Megaro alleges that either Mr. Vanstone, “John Doe”, or Mr. Khatra was the driver of the Nissan; that if Mr. Vanstone was not driving, he gave consent, express or implied, to “John Doe” or Mr. Khatra and is vicariously liable under s. 86 of the Motor Vehicle Act.

A Trial Judge determines the negligence of the driver of Mr. Vanstone’s vehicle –whomever it may be – “was the sole cause of the collision” and awards damages to Mr. Megaro in the amount of $1,546,081. Supplementary reasons provide that Mr. Vanstone is vicariously liable under s. 86(1) of the Motor Vehicle Act on the basis that Mr. Vanstone gave his keys to one of three friends on the night of the collision.

The Insurance Corporation of British Columbia (“ICBC”) commences third party proceedings under s. 77 of the Insurance (Vehicle) Act, R.S.B.C. 1996, c. 231 – a provision allowing it to defend the claim and raise defences available to Mr. Vanstone. ICBC then argues the Trial Judge erred in concluding Mr. Vanstone is vicariously liable. The Court of Appeal concludes there is no basis to interfere with the Trial Judge’s conclusions and dismisses the ICBC’s appeal.


The Trial Judge’s conclusion that the driver of Mr. Vanstone’s Nissan had his consent to operate the vehicle was an inference. As there was no direct evidence on point, the question for the Court of Appeal was whether there was sufficient evidence to support that inference.

What is the standard of review to be applied to the inferences of a Trial Judge? The Court of Appeal cited both Housen v. Nikolaisen, 2002 SCC 33 and H.L. v. Canada (Attorney General), 2005 SCC 25, noting that “an inference must be measured against the standard applicable to findings of fact, with the proviso that an inference must be based on ‘accepted facts’”. (See para. 22). Further, citing R. v. Munoz (2006), 2006 CanLII 3269 (ON SC) at paras. 30–31 and West Vancouver (District) v. Liu, 2016 BCCA 96, the Court of Appeal described the “no-go zone” for Trial Judges as “the use of speculation or conjecture to bridge an inferential gap”. (See para. 30).

In this case, the Court of Appeal determined that the inference drawn by the Trial Judge (i.e. that one of Mr. Vanstone’s friends was driving his car with consent at the time of the collision) “complied with the standard described above as based on ‘accepted facts’ and ‘reasonably supported by the evidence’”. (See paras. 29-30).

The ICBC’s critique was that the Trial Judge’s inferences were based on inadmissible hearsay evidence – including the evidence of witnesses who relayed a telephone conversation they overheard between Mr. Vanstone and unidentified persons and a conversation in which it was alleged Mr. Vanstone asked individuals to lie about his Nissan car being stolen. (See paras. 31-32).

The Court of Appeal, however, took no issue with the use of this evidence. For the Court of Appeal, “[t]here is no evidence contradicting the evidence…as to the fact that these statements were made” and, in any event, the Trial Judge determined that the witnesses were credible. (See para. 33). Despite the ICBC’s concerns about the use of this evidence, the Court of Appeal found “it was available to the judge for a circumstantial, non‑hearsay purpose”. (See para. 33). In other words, it was not the contents of the statements, but the fact of the statements and phone call which “tended to prove Mr. Vanstone’s involvement in the circumstances of the accident”. (See para. 34).

The Court of Appeal also found there was sufficient evidence to conclude Mr. Vanstone had engaged in a defensive “deception” and, therefore, “to infer Mr. Vanstone either did consent to the driver operating his vehicle or, the driver being one of his three friends he left behind, that Mr. Vanstone would have consented had consent been sought.” (See para. 39). It remains to be seen whether ICBC will test whether the Trial Judge and Court of Appeal will enter the “no-go zone” at the Supreme Court of Canada by way of a Leave to Appeal.

Counsel for the Appellant: Grant Ritchey (QA Law, Vancouver)

Counsel for the Respondent, Giulio Megaro: Daniel Corrin (Webster & Associates, Vancouver), Ryan Dalziel and Caitlin Ehman (Hunter Litigation Chambers, Vancouver)

Counsel for the Respondent, Insurance Corporation of British Columbia: Riordan Bacha (Harris & Brun Law Corporation, Vancouver)