Chapter 2 - Legal Concepts Flashcards
(11 cards)
What are the four legal concepts that regulate the settlement of auto accident claims?
1) negligence
2) onus of proof
3) subrogation
4) absolute liability
Define negligence.
- is the omission to do something which a reasonable person guided by those considerations which ordinarily regulate the conduct of human affairs, would do, or doing something which a prudent and reasonable person would not do.
Define liable.
- means legally responsible
What does legislation state about who is liable if you lend your car to a friend?
1) the owner of the auto
2) the driver of auto
3) lessee of auto
- if you lend a car to your friend and he gets into an accident for which he is at fault, the owner/lessee are just are legally responsible for the accident as the driver is
- but the driver must be operating the auto with the consent or implied consent of owner/lessee
- SECTION 192
Define onus of proof.
- means the burden or responsibility of proof, and is also known as “onus probandi”
- is related to the concept of negligence
- when one person sues another, the law puts the onus of proof upon the person suing (the plantiff)
- therefore, the one who alleges the other motorist is negligent is required to prove that negligence
- one exception is an accident involving a pedestrian or cyclist, the motorist presumed to be liable must prove that he/she was not negligent
- SECTION 193
How is fault determined?
- by fault charts or a similar fault assessment process
- fault charts are based on precedent set by decisions for accidents that have previously happened
Explain subrogation.
- an insurer who pays to repair an insured’s car that was damaged by a 3rd party, has the right to recover from the at-fault 3rd party
- right of subrogation can be limited or removed by legislation (in Ontario)
Define subrogation.
- is the transfer of legal rights (to an insurer) of someone whose debts/expenses have been paid to pursue recovery from an at-fault party
Explain absolute liability.
- legal concept that can influence settlement of auto insurance claims
- the insurer is responsible to pay 3rd party claims even though the insured has breached a policy condition
- 3rd parties are given a direct right of action against the insurer to have the insurance money under the policy paid directly to them
- some jurisdictions require a judgment to be obtained in the favour of the 3rd party before money will be awarded
- insurer has legal right to recover from its own insured any amount paid by reason of absolute liability
- insured may find it difficult to obtain future insurance until they have repaid any amounts their insurers paid due to absolute liability provision
- insurers are only obligated to pay up to the minimum limits of insurance in the jurisdiction involved, even if policy has higher limits
- best defense for insurers against absolute liability claims is to do a thorough research before they bind coverage
What does SECTION 258 (1) - application of insurance money, 3rd party claims, etc and SECTION 258 (4) - insurer absolutely liable contain?
The right of a person who is entitled to have insurance money applied upon the person’s judgment or claim is not prejudiced by:
1) an assignment, waiver, surrender, cancellation or discharge of contract made by the insured after the happening of the event giving rise to a claim under contract
2) any act or default of the insured before/after that event in contravention of this part or the terms of the contract
3) any contravention of the criminal code or a statute of any province/territory in Canada or of any state/district of Columbia of the USA by the owner or driver of the auto
Explain negligence.
- is the fialure to do what a reasonable and prudent person would do
- its doing what a resonable and prudent person would not do
- legislation states that a negligent person in an auto accident is liable (legally responsible) for damage/injury caused
