Canadian Underwriter

Why this dirt bike in closed competition was considered an “automobile”

November 25, 2022   by David Gambrill

Shot of a motocross competition

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A dirt bike driven in a closed course motocross competition is an “automobile” under Ontario’s auto accident benefits scheme, thus paving the way for a seriously injured driver to claim auto accident benefits from his auto insurer, the Ontario Court of Appeal has ruled.

Released Wednesday, the case addressed whether an exemption under the province’s Off-Roads Vehicles Act (ORVA) applied to the dirt bike driven by Michael Beaudin, who was rendered paraplegic by an accident during the competition.

Beaudin was driving his dirt bike in a motocross competition held on July 9, 2017, when he was severely injured. He is now confined to a wheelchair. No other vehicles or individuals were involved in the incident.

Beaudin had an auto insurance policy with Travelers, but his dirt bike was not listed on the policy. He applied for accident benefits. Travelers Insurance Company of Canada denied accident benefits coverage on the basis that his dirt bike was not an “automobile.”

Ontario law basically says a vehicle counts as an automobile if it requires insurance to be driven. However, the Off-Road Vehicles Act contains an exemption for “off-road vehicles driven or exhibited at a closed course competition or rally sponsored by a motorcycle association.”

Initially, Ontario’s Licence Appeal Tribunal sided with the insurer. A LAT adjudicator found the competition’s sponsor, Canadian Motorsport Racing Competition, a for-profit corporation, was affiliated with the Alberta Motorcycle Sport Association, thus qualifying the CMRC as a sponsoring motorcycle association.

Beaudin appealed and LAT’s associate chair reversed the decision. The associate chair ruled the CMRC did not qualify as a sponsor under ORVA’s definition of a “motorcycle association,” which states a motorcycle association must have “a published constitution and a membership roster of more than twenty-four persons.”

Travelers appealed, but Ontario’s Divisional Court said LAT’s ruling that CMRC did not qualify as a sponsor under the ORVA exemption was a mix of fact and law and thus could not be appealed.

And so, Travelers went to the Court of Appeal, challenging the finding that Beaudin’s dirt bike in the closed competition did not come under the ORVA exemption.

Ultimately, the Court of Appeal for Ontario determined ORVA should be read in harmony with the public safety mandate of other Ontario vehicle-related legislation (e.g. Highway Traffic Act, the Compulsory Automobile Insurance Act, and the Motorized Snow Vehicles Act), which require universal insurance coverage for vehicle drivers.

“In the context of persons participating in organized closed course competitions, Travelers submits that an interpretation that requires participants to obtain insurance as set out in s. 15 of the ORVA is inconsistent with a proper consideration of the risk involved,” as the Court of Appeal framed Travelers’ argument. “They argue that universal automobile insurance for vehicles used for day-to-day commutes or recreational use of a vehicle on public land makes sense because operating a motor vehicle on public highways is a risky activity to the public and it is important that innocent victims are protected from having no means to seek damages from those who might cause accidents.

“In contrast, requiring those who drive off-road vehicles at an organized close course competition to have licences, permits, insurance, does not make sense because the activity has little risk to anyone else but themselves.”

The Court of Appeal rejected Travelers’ argument for a variety of reasons. Among them:

“It seems to me that permitting an exemption only for sponsored events aligns with the public safety focus of the ORVA,” Ontario Court of Appeal Justice Steve Coroza wrote for the unanimous three-judge panel. “Sponsoring motorcycle associations would have safety protocols in place for both closed course competitions and rallies and could be counted on to promote public safety and the safe driving of competition vehicles.

“Indeed, the rules of a sponsored competition would likely prescribe what protective equipment must be worn. While minimum age requirements may not be enforced, competitors would be subject to adult supervision. It is also apparent from the evidence submitted before the LAT in this case that organized competitions also provide at least some level of insurance protection for participants.”


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