Rentals of e-scooters raise legal issues for users, owners and insurers

Short-term rentals of electric scooters (also known as e-scooters) raise a number of questions. Are e-scooters legally classified as motor vehicles (or even automobiles)? If so, what are the implications of this? Who is liable for an injury caused or suffered by the rider of an e-scooter? In Alberta and other jurisdictions in Canada¹, legislative framework is ill-equipped to provide answers to these questions. In the current climate of legal uncertainty, riders, rental companies, and insurers all face some risk as a result of short-term e-scooter rentals.

What are e-scooters?

The Alberta Traffic Safety Act defines a “motor vehicle” as “a vehicle propelled by any power other than muscular power” or a moped, while the Criminal Code defines a “motor vehicle” as a vehicle that is drawn, propelled or driven by any means other than muscular power”, other than railway equipment. It is difficult to predict whether courts will find that e-scooters fall within these definitions.

The Alberta Insurance Act defines an “automobile” as including “a trolley bus and a self propelled vehicle, and the trailers, accessories and equipment of automobiles,” but not “watercraft, aircraft or railway rolling stock that runs on rails.” The Supreme Court has noted that the word “automobile” carries a broader meaning in the insurance context than it does in everyday usage. E-scooters certainly do not seem to be automobiles in the everyday sense, but, as long as the legislation does not expressly exclude them, their legal status is ambiguous.

Does it matter what we call them?

What does it mean if e-scooters are defined as motor vehicles or automobiles? First, under the Criminal Code, it is an offence for a person to operate a “conveyance” (which includes a “motor vehicle”) while their ability to operate it is impaired by alcohol or drugs. Although riding an e-scooter while impaired is not advisable, partygoers may consider it preferable to driving. Without clear regulation, it is not clear whether impaired e-scootering is prohibited.  

Second, if e-scooters are motor vehicles, they are governed by the provisions of the TSA relating to motor vehicles (and the associated regulations). Among other things, this means that riders must have a valid driver’s license, e-scooters must be registered and have a licence plate, and riders may not operate them unless they are properly insured. Moreover, the operator of an e-scooter involved in an accident could be deemed to be an agent or employee of the e-scooter’s owner. This raises the possibility of vicarious liability for rental companies.

Most likely, the Alberta legislature never actively intended these provisions to apply to e-scooters. The most obvious solution is simple legislative housekeeping (while also addressing the issue of riders operating e-scooters while under the influence of alcohol or drugs). Until the statutes are amended to take e-scooters into account, their legal status is frustratingly unclear.

Liability and e-scooters

Further issues arise with respect to insurance coverage for injuries caused by e-scooter use. E-scooter rental companies require prospective riders to agree to a user agreement containing a waiver of liability. It is an open question whether such waivers are valid or enforceable. Moreover, while rental companies typically require users to be over the age of eighteen, there is nothing actually stopping a young person from using an e-scooter. There is reason to be sceptical over whether even a clearly worded waiver is effective against a minor.

It is not only the rider who may be injured. While e-scooters are meant to be used by a single rider and some user agreements prohibit expressly carrying passengers, there is nothing except common sense to stop a rider from carrying a passenger. What happens if a rider carries a passenger and that passenger is injured? And what happens if a rider injures a third party?

In Alberta, car accident injuries are covered by the Standard Auto Policy (SPF No. 1) or, in the case of uninsured drivers, the Motor Vehicle Accident Claims Program (MVACP). It is unlikely that either SPF No. 1 or the MVACP would stretch to cover injuries caused by e-scooters. SPF No. 1 covers liability for loss or damage “arising from the ownership, use or operation of [an] automobile,” defined as either the automobile specifically described in the policy, or any automobile of the private passenger or station wagon type while personally driven by the insured. These definitions would likely not include e-scooters. The Alberta Motor Vehicle Accident Claims Act covers damages for injury or death arising out of the use or operation of a motor vehicle, defined as a vehicle that is required to be registered under the TSA. It seems unlikely that there was any legislative intent to require e-scooters to be registered under the TSA, let alone to include them in the statutory scheme of the MVACA.

Homeowners’ and tenants’ insurance policies may exclude liability arising from motor vehicle accidents, again raising the question of whether e-scooters are defined as motor vehicles.² While many credit cards offer insurance coverage to cardholders, these policies may expressly exclude e-scooters. Moreover, such policies typically only cover damage to or loss or theft of the vehicle. They generally do not include liability coverage.

Conclusion

The introduction of e-scooters to Canadian cities raises numerous questions, few of which have clear answers as yet. It is not clear how e-scooters are to be classified at law, how they are to be treated for the purposes of insurance policies, or to what extent rental companies and riders are at risk of unanticipated liability. Until the TSA, Insurance Act, and related statutes are amended to take into account the growing popularity of e-scooters, riders, renters, insurers, and pedestrians are faced with a frustrating degree of uncertainty.

Christine Pratt is a partner at Field LLP. Rachel Weary has a J.D. from the University of Alberta.