Belmont Financial Group Inc. v. Trisura Guarantee Insurance Co.

• Jurisdiction: Nova Scotia
• Court: Court of Appeal of Nova Scotia (Canada)
• Judge: Roscoe, Hamilton and Fichaud, JJ.A.
• Citation: (2008), 269 N.S.R.(2d) 143 (CA),2008 NSCA 87
• Date: 10 September 2008
• Subject Matter: INSURANCE

Belmont Financial v. Trisura Guarantee Ins. (2008), 269 N.S.R.(2d) 143 (CA);

    860 A.P.R. 143

MLB headnote and full text

Temp. Cite: [2008] N.S.R.(2d) TBEd. OC.023

Trisura Guarantee Insurance Company (appellant) v. The Belmont Financial Group Incorporated (respondent)

(CA 292233; 2008 NSCA 87)

Indexed As: Belmont Financial Group Inc. v. Trisura Guarantee Insurance Co.

Nova Scotia Court of Appeal

Roscoe, Hamilton and Fichaud, JJ.A.

October 10, 2008.

Summary:

Belmont Financial Group Inc. applied for an order requiring an insurance company (Trisura) to defend it under a claims made errors and omissions policy respecting a negligent misrepresentation action.

The Nova Scotia Supreme Court, in a decision reported 266 N.S.R.(2d) 164; 851 A.P.R. 164, held that Trisura had a duty to defend. Trisura appealed.

The Nova Scotia Court of Appeal allowed the appeal, holding that Trisura had no duty to defend.

Insurance - Topic 725

Insurers - Duties - Duty to defend - [See Insurance - Topic 7628 ].

Insurance - Topic 7628

Professional liability insurance - Scope of coverage - Policy period - "Claims made" - Meaning of - A pension plan gave union members the option of receiving the commuted value of their pension upon membership termination - In December 2004, the pension plan administrator (Belmont) provided Richardson, a union member, at his request, with an estimate of the commuted value of his pension - The union modified the plan in October 2005, removing the commuted value option - Subsequently, when Richardson sought the commuted value of his pension, Belmont notified him that the plan did not provide for this option - In letters dated May 23, July 11 and August 24, 2006, Richardson notified Belmont that he was considering court action - On September 20, 2006, Trisura Guarantee Insurance issued a claims made errors and omissions insurance policy to Belmont covering September 20, 2006 to September 20, 2007, but containing a retroactive date of February 3, 2003 - In the insurance application, Belmont checked "no" to the question whether it had knowledge of pending claims - On December 5, 2006, Richardson sued Belmont for negligent misrepresentation - Belmont notified Trisura of the action, but Trisura denied coverage - An issue arose as to whether Trisura had a duty to defend (i.e., did the insured have notice of claims covered by the policy prior to the coming into force of the policy) - The Nova Scotia Supreme Court held that in these circumstances Trisura had a duty to defend - Belmont had not received a "claim", as defined by the policy, prior to the coming into force of the Trisura policy - Therefore, the exclusion respecting prior claims did not apply - Trisura appealed - The Nova Scotia Court of Appeal allowed the appeal, holding that Trisura had no duty to defend - The chambers judge misinterpreted the letters of May 23, July 11 and August 24, which taken together constituted notice to Belmont of a potential negligent misrepresentation claim - Similarly, before the inception date of the policy (i.e., September 20, 2006), Belmont "ought to have reasonably foreseen" Richardson's claim.

Cases Noticed:

Housen v. Nikolaisen et al., [2002] 2 S.C.R. 235; 286 N.R. 1; 219 Sask.R. 1; 272 W.A.C. 1; 2002 SCC 33, refd to. [para. 23].

H.L. v. Canada (Attorney General) et al., [2005] 1 S.C.R. 401; 333 N.R. 1; 262 Sask.R. 1; 347 W.A.C. 1, refd to. [para. 23].

Nichols v. American Home Assurance Co., [1990] 1 S.C.R. 801; 107 N.R. 321; 39 O.A.C. 63, refd to. [para. 24].

Scalera v. Lloyd's of London, [2000] 1 S.C.R. 551; 253 N.R. 1; 135 B.C.A.C. 161; 221 W.A.C. 161, refd to. [para. 24].

Non-Marine Underwriters v. Scalera - see Scalera v. Lloyd's of London.

Sansalone v. Wawanesa Mutual Insurance Co. et al., [2000] 1 S.C.R. 627; 253 N.R. 95; 135 B.C.A.C. 255; 221 W.A.C. 255, refd to. [para. 24].

Monenco Ltd. et al. v. Commonwealth Insurance Co. et al., [2001] 2 S.C.R. 699; 274 N.R. 84; 155 B.C.A.C. 161; 254 W.A.C. 161, refd to. [para. 24].

Jesuit Fathers of Upper Canada v. Guardian Insurance Co. of Canada et al., [2006] 1 S.C.R. 744; 348 N.R. 307; 211 O.A.C. 363; 2006 SCC 21, refd to. [para. 24].

Hamel Construction Inc. v. Lombard Canada Ltd. (2005), 232 N.S.R.(2d) 138; 737 A.P.R. 138; 2005 NSCA 69, refd to. [para. 24].

Reid Crowther & Partners Ltd. v. Simcoe & Erie General Insurance Co., [1993] 1 S.C.R. 252; 147 N.R. 44; 83 Man.R.(2d) 81; 36 W.A.C. 81, refd to. [para. 24].

Queen (D.J.) v. Cognos Inc., [1993] 1 S.C.R. 87; 147 N.R. 169; 60 O.A.C. 1, refd to. [para. 32].

Counsel:

Nancy Murray, Q.C. and Virve Sandstrom, for the appellant;

Brian Casey, for the respondent.

This appeal was heard in Halifax, N.S., on September 10, 2008, before Roscoe, Hamilton and Fichaud, JJ.A., of the Nova Scotia Court of Appeal. The following decision was delivered for the court by Fichaud, J.A., on October 10, 2008.