Caci V. MacArthur

In late April the Supreme Court refused leave to appeal the Ontario Court of Appeal case of Caci v. MacArthur. ¹ This case will therefore remain a major factor in determining the relationship between Ontario’s Criminal and Civil justice systems. It is important, however, that the rule in Caci is not taken too far.

Jerry Caci sustained injuries as a passenger in a motor vehicle accident and sued the two drivers involved in the accident, MacArthur and Dorkin. By the time Caci’s civil lawsuit reached the courts, MacArthur had been charged, tried, and convicted of dangerous driving causing bodily harm. In Caci’s civil trial, the judge reasoned that MacArthur’s criminal conviction was conclusive of his civil negligence and no further evidence could be heard on the issue. ² The Ontario Court of Appeal upheld this trial court decision citing a doctrine called “abuse of process.” The Court went on to state the limits of this doctrine were reached when it came to hearing evidence about Dorkin’s contributory negligence that was not in issue at MacArthur’s criminal hearing. The trial judge had correctly allowed evidence regarding the potential contributory negligence of Dorkin to be heard. ³

Despite the ability to adduce evidence regarding contributory negligence, the holding that criminal guilt determines civil negligence frustrates defence lawyers and insurance companies because it removes their ability to investigate, negotiate and litigate the nuances of negligence in light of what can appear to be a blunt criminal finding of guilt. Even on the same facts, the finding of criminal guilt beyond a reasonable doubt is a substantially different exercise than the apportionment of responsibility among multiple potentially negligent parties. To civil litigants this ruling can look like Lady Justice is being forced to use a sword when she should be using a scalpel.

Insurance companies often go to great expense to defend their insured in a civil action. Insurers now have the ability to obtain downloads of “black boxes” on some vehicles and have the financial ability to obtain accident reconstruction reports prepared by engineers. These are tools that may not be used at a criminal or quasi-criminal hearing where the individual defendant may not have the financial means to launch a complete investigation into his or her own defence. Alternatively, the accused may not have the drive to complete an in-depth investigation in light of the punishment faced, which may only carry a fine that would pale in comparison to the cost of a complete engineering assessment.

Both the trial and appeal level decisions in Caci heavily rely on the Supreme Court of Canada case of Toronto (City) v. C. U. P. E. Local 794, which takes circumstances like these into account and provides at least some room for civil litigants to manoeuvre after a criminal conviction. The reasons in C. U. P. E. flesh out which prior judicial findings will bind future civil proceedings and why.

In C. U. P. E., the Supreme Court of Canada was concerned that being able to re-litigate a matter in a separate proceeding would be an “abuse of process” because it would bring the administration of justice into disrepute. In other words, people would have a hard time trusting a system that potentially delivered inconsistent results on the same facts. Not only that, but such a system would waste judicial resources and produce more uncertain, less authoritative results. ⁵

The Supreme Court in C. U. P. E. did carve out exceptions to the general rule where re-litigation should be allowed, which are: When the first proceeding is tainted by fraud or dishonesty; when fresh new evidence, previously unavailable, conclusively impeaches the original result; or when fairness dictates the original result should not be binding. ⁶

The Supreme Court in C. U. P. E. states:

…if, for instance, the stakes in the original proceeding were too minor to generate a full and robust response, while the subsequent stakes were considerable, fairness would dictate that the administration of justice would be better served by permitting the second proceeding to go forward than by insisting that finality should prevail. An inadequate incentive to defend, the discovery of new evidence in appropriate circumstances or a tainted original process may all overcome the interest in maintaining the finality of the original decision. ⁷

The finding in Caci is therefore not a shocking new statement of law, but is instead the application of the rule in C. U. P. E. to a particular fact situation. People in car accidents are often not charged criminally, but are instead charged with offences under the Highway Traffic Act. ⁸ These proceedings often result in significantly lower penalties than criminal proceedings. Are Highway Traffic Act offences treated the same as criminal offences? Also, when a person pleads guilty (sometimes to a lesser charge) instead of going to trial, is that guilty plea determinative of negligence in subsequent civil actions?

The impact guilty pleas and quasi-criminal Highway Traffic Act offences have on civil actions was considered by the Ontario Court of Appeal in a decision released on Feb. 6, 2009, Becamon v. Wawanesa Mutual Insurance Company. ⁹ The Court of Appeal held that evidence of a prior conviction is only prima facie proof of guilt in subsequent civil proceedings. ¹⁰ This presumption is rebuttable in a subsequent civil action where re-litigation would not constitute an abuse of process. The Becamon case applied the third exception in C. U. P. E. in that it was held that re-litigation in a civil action after a guilty plea to a Highway Traffic Act offence (where the punishment was only a minor fine and thus the stakes were not very high) would promote fairness and would not constitute an abuse of process. Fairness dictated that the original result (the guilty plea) should not be binding, ¹¹ and evidence was allowed regarding negligence in the civil action.

This result clarifies that both guilty pleas and quasi-criminal proceedings attract the general rule against re-litigation under the abuse of process doctrine. However, the exceptions to the rule, as noted in C. U. P. E., can be applied to relieve civil litigants from this harsh reality. Unfortunately, there is no clear line for when exactly the exception will apply. Not all guilty pleas or Highway Traffic Act convictions will necessarily attract the exception, but many will. This uncertainty should lead to some concerns for insurers.

One concern is insurers will hesitate to fund costly investigations once criminal or quasi-criminal convictions have been rendered. It will now be prudent for insurers to obtain the transcripts from the criminal or quasi-criminal hearing to determine if there is any cause to investigate liability in the civil action. It may even be worthwhile for insurers to commence investigation at the time of the criminal hearing if they know that a civil action is forthcoming. The results of the investigation could then be put forward at the criminal trial knowing it could have an impact on the civil action years later. One barrier to this is insurers don’t often know civil actions are forthcoming until litigation is commenced (or notice is given of pending litigation), which could be years after the conviction.

Insurers should know the Caci decision must be read in conjunction with the C. U. P. E. ruling where the Supreme Court of Canada provided exceptions to the general rule against re-litigation. Application of the C. U. P. E. exceptions will ensure civil negligence can still be an issue that may be litigated even in the face of a prior conviction.

Lauren Bloom is an associate with Blouin, Dunn LLP. Her practice involves all forms of insurance defence personal injury litigation.

Brendan Lanigan is an articling student at Blouin, Dunn LLP and is fascinated by evolving issues in insurance defence.

1 [2008] O. J. No. 4436 (On. C. A.)[Caci] 2 Caci v. MacArthur, 2007 CanLII 690 (ON S. C.) 3 Caci, 17.

4 [2003] 3 S. C. R. 77 5 CUPE, 51. 6 CUPE, 52. 7 CUPE, 53.

8 R. S. O. 1990, C. H. 8 9 2009 ONCA 113

10 Re: Del Core and Ontario College of Pharmacists (1985), 51 O. R. (2d) 1 11 CUPE, 52.