[Jeremy Bruneel for The Lawyers Weekly] Click here to see full sized version.

The Supreme Court of Canada recently released the latest chapter on the meaning of “accident.” Justice Binnie wrote unanimous reasons on a subject that is not always as straightforward as lawyers and litigants might think.

In Co-operators Life Insurance Co. v. Gibbens, [2009] S.C.J. No. 59, Gibbens was a high water-blaster in B.C. He was insured under a Co-operators accident insurance policy through his union. The policy provided a $200,000 benefit in the event of total disability from critical disease. To qualify, the disability had to be caused by “accidental means.”

Gibbens had unprotected sex with three women over two months and contracted herpes. He developed a rare and severe complication, inflammation of the spine and paralysis from below the mid-abdomen. Gibbens was 45 years old.

Both the B.C. Supreme Court and Court of Appeal concluded the disease was accidental and covered by Gibben’s insurance. Those courts reasoned that although Gibbens obviously intended to have sex, the paralysis that followed was not expected or intended, and therefore it was accidental. Unprotected sex is risky behaviour, but so are a great many other activities of normal living. That is why people buy insurance and expect to be covered by it.

The traditional common law definition of accident has long been interpreted broadly, as “an unlooked for mishap or an untoward event which is not expected or designed.” In Gibbens, the SCC found the lower courts’ analysis had stretched the meaning of accident past the breaking point.

Justice Binnie disagreed there was an accident and found no coverage. His focus remained firmly fixed on the event causing injury, and whether the event could properly be regarded as an accident in the everyday sense of the word.

Binnie labelled as “law office metaphysics” the “isolation of a particular element in a chain of events that should be considered in its entirety.” An unexpected outcome by itself does not establish that there was an accident causing disease. The concern is not what Gibbens intended or knew when he engaged in unprotected sex. The real issue is whether the disease process occurred in the ordinary course of living, as opposed to having an accidental origin or cause.

Binnie compared Gibbens’ predicament to other viral infections contracted in public places. The mere transmission of disease is not really an accident, in the sense people mean when they use that word.

An important principle for Binnie is the commercial atmosphere of the insurance contract, which governs the so-called “reasonable expectations of the parties to the contract.” The language used in the policy indicated that the parties to it did not expect or bargain for a comprehensive health insurance benefit. The policy did not provide coverage for disability caused by any unexpected disease or injury. Binnie noted that the premiums for accident benefits insurance are cheaper than other, more comprehensive types of insurance.

Gibbens stresses that accident insurance is broad coverage, and insurers should expect to pay whenever an accident triggers disease or injury causing death or disability. Disputes will no doubt persist on the margins. The line between a known accidental trigger or cause, and a non-accidental disease or illness process, is sometimes hard to draw.

Binnie referred to an American decision where an insured died from an aneurysm, which occurred “during the exertions of sexual intercourse.” The aneurysm was traceable to pre-existing hypertension. The sex was not accidental. It did not cause the aneurysm. Sex was an ordinary activity of life and happened to provide the occasion when the aneurysm ruptured.

There may be reason now to doubt the correctness of Kolbuc v. ACE INA Insurance, [2007] O.J. No. 1862, which considered the claim of an insured plasterer who contracted the West Nile virus from a mosquito bite, and was rendered a paraplegic as a result. Kolbuc won his appeal and received the benefit.

Although Binnie stated that Kolbuc was not before the SCC, and he made no direct comment about its merits, the reasoning in Gibbens points in a different direction. In Binnie’s view, the exposure to infectious diseases in modern life is not the product of accidents or “accidental means” in the everyday sense of those words. It is more accurately regarded as part of the ordinary course of living.

The post-Gibbens approach to accidental losses will no doubt continue to generate “law office metaphysics.” However, the analysis emphasis in the future may focus more simply and directly on the triggering event that caused disease or injury, and less on the reverse analysis approach of some past decisions. The SCC has made it clear that the mere fact that an outcome was unexpected or unintended by the insured may not be enough to make it accidental for coverage purposes.

Michael Burgar is a partner at Adair Morse LLP in Toronto.