Omolara Oladipo January 8 2019 Apportionment of liability under workers' compensation scheme Dentons | Litigation - Canada Omolara Oladipo Litigation FactsDecisionCommentMcIver v McIntyre (2018 ABCA 151) examined the apportionment of liability for damages between multiple defendants where at least one of them is statutorily immune from liability.FactsDefendant Carlyle McIntyre took his vehicle into Calgary Propane and Automotive for repairs. A Calgary Propane employee Lewis Morgan, took the vehicle for a test drive and collided with a vehicle driven by Brent McIver, causing McIver injuries. Both Morgan and McIver were driving in the course of their employment but, at trial, Morgan's negligence was found to have caused the collision.McIver obtained benefits from the workers' compensation scheme under the Alberta Workers' Compensation Act,(1) and the Workers' Compensation Board sued McIntyre on the basis that he was vicariously liable for McIver's loss as the owner of the vehicle under Section 187 of the Traffic Safety Act.(2)The provisions of the Workers' Compensation Act immunised Calgary Propane from the lawsuit. The only party with exposure was McIntyre, the owner of the vehicle, who did not come under the protection of the Workers' Compensation Act.DecisionThe Court of Queen's Bench considered whether an employer could be held vicariously liable for damages caused by its employee's negligence when the injured party, the employee and the employer, are subject to the Workers' Compensation Act. If so, could the court apportion liability for the resulting damages to the employer? At trial, Justice GA Campbell determined that there are two vicariously liable tort feasors:McIntyre, as an owner under the Traffic Safety Act; andCalgary Propane, as Morgan's employer, pursuant to Section 23(2) of the Workers' Compensation Act.The court found that the effect of this section is that a defendant who is not immune from a law suit under the Workers' Compensation Act can be held liable only for the portion of the plaintiff's loss that was occasioned by the defendant's own fault or negligence.For reasons discussed below, Campbell apportioned 100% of the plaintiff's damages to Calgary Propane.The court of appeal explored the question: what is the apportionment of liability between the defendants pursuant to Section 23(2) of the Workers' Compensation Act when the tort feasor is immune under the legislation? The court re-examined liability for McIver's injuries. More specifically, it addressed whether the court should apportion liability between:Calgary Propane, which would have been vicariously liable for the negligence of its employee but had been immune from the action; andMcIntyre, who had been vicariously liable under the Traffic Safety Act as the owner of the vehicle but had no protection under the Workers' Compensation Act.The court of appeal returned to the notion that vicarious liability is a no-fault offence in the sense that the employer or owner need not have participated in, or even authorised the employee's act of wrongdoing. However, in another sense, it implies fault. The court found that the percentage of liability is proportional to the fault, and defendants who are unprotected under the Workers' Compensation Act are liable only for the portion of a plaintiff's loss that is caused by their own fault. In instances where the fault is only notional (eg, vicarious liability situations) a defendant could end up being apportioned none of the liability. To determine the percentage of notional fault the court will look at various elements, such as the degree of supervision of, and direct contact with, the protected employee or defendant.The court of appeal upheld the decision of the trial judge to allocate 0% of the fault to the unprotected vehicle owner.The court states as follows:Where a stranger to the workers' compensation scheme, by their fault, causes loss to a worker in the course of their employment, the stranger should be held liable only for the portion of a plaintiff's loss that is caused by their own fault.At trial, Campbell cut the conceptual knot of apportioning loss according to the contribution made by the parties' fault (which is an artificial exercise where two parties are vicariously liable for the tort of another) by applying Blackwater v Plint.(3) Blackwater stands for the proposition that when two parties are vicariously liable for a loss, and it is appropriate to allocate the loss between them according to their fault, the loss may be allocated according to the degree of supervision that each party had over the tort feasor. The court in Blackwater found that the unprotected owner had no control or say over the employee who drove the vehicle, whereas the protected employer supervised the employee, and had full custody and control of the vehicle at the time of the accident. Accordingly, the court apportioned 100% of the loss to the fault of the protected.In applying Blackwater, Campbell found that the protected employer had been in a position to supervise the driver, whereas the unprotected owner had not been. McIntyre had no control or say over who drove his vehicle, whereas Calgary Propane had been responsible for hiring and supervising its mechanics and authorising test drives. Further, the agreed statement of facts does not indicate that the unprotected owner had any direct contact with the protected employee (although direct contact on its own would not have been enough).In apportioning the plaintiff's losses between the vehicle owner who is vicariously liable, pursuant to Section 187 of the Traffic Safety Act, and the employer of the protected employee, which is notionally vicariously liable, the court noted as follows:The liability of the protected driver defendant and the notional liability of the protected employer is several, not joint, or joint and several. The court may hold the owner liable to compensate the plaintiff's loss only to the extent that the owner's fault had caused it – the owner is not liable to compensate for the loss that is caused by the protected employer's fault.The criterion for apportioning the plaintiff's loss between the two parties contemplated in Section 23(2) of the Workers' Compensation Act is the relative contributions their fault made to the loss coming about. Apportioning liability under Section 23(2) requires the court to consider how much of the unprotected owner's fault and the protected owner's fault had each contributed to the plaintiff's loss.Since liability under Section 23(2) is several and Section 23(1) bars an action against the protected employer, any of the plaintiff's loss allocated to the fault of the protected employer and not to the unprotected owner is unrecoverable by the plaintiff.The court of appeal cautioned that its decision should not be understood as establishing the precedent that, when a vehicle owner leaves a vehicle at a garage for repairs and an employee takes the vehicle out for a test drive and negligently injures a plaintiff, the employer's garage is always (notionally) liable for 100% of the loss. The trial judge's decision on apportionment was sensitive to the unprotected and protected owners' degrees of supervision and contact with Morgan.McIver filed an application for leave to appeal to the Supreme Court of Canada on 18 June 2018.CommentThis case is a good example of the laws of apportioning liability where a statute protects one tort feasor. If the remaining defendant is only notionally liable and has no actual fault as evidenced by a failure to exert expected control over the actual tort feasor, such cases may have the unfortunate result of leaving the plaintiff with no recourse.For further information on this topic please contact Wendy N Moody or Omolara Oladipo at Dentons Canada LLP by telephone (+1 604 687 4460) or email ([email protected] or [email protected]). The Dentons Canada LLP website can be accessed at www.dentons.com.Endnotes(1) RSA 2000, c W-15.(2) RSA 2000, c T-6.(3) 2005 SCC 58,  3 SCR 3.