Foundation of Canada Engineering Corp. v. Canadian Indemnity Co. and Employers Liability Assurance Co.,

• Jurisdiction: Federal Jurisdiction (Canada)
• Judge: Martland, Ritchie, Dickson, Beetz and de Grandpré, JJ.
• Citation: (1977), 13 N.R. 282 (SCC),[1977] 2 WWR 75,1977 CanLII 155 (SCC),74 DLR (3d) 266,[1977] SCJ No 41 (QL),1977 CanLII 151 (SCC),[1978] 1 SCR 264,[1977] SCJ No 47 (QL),13 NR 282,[1978] 1 SCR 84
• Court: Supreme Court (Canada)
• Date: 08 February 1977

Can. Eng. Corp. v. Cdn. Indemnity Co. (1977), 13 N.R. 282 (SCC)

MLB headnote and full text

Foundation of Canada Engineering Corporation Ltd. v. Canadian Indemnity Company and Employers Liability Assurance Co. Ltd.

Indexed As: Foundation of Canada Engineering Corp. v. Canadian Indemnity Co. and Employers Liability Assurance Co.

Supreme Court of Canada

Martland, Ritchie, Dickson, Beetz and de Grandpré, JJ.

February 8, 1977.

Summary:

This case arose out of the defective construction of a roof for a cement manufacturing plant. The plaintiff insured acted as a construction manager in connection with the construction of the cement manufacturing plant. The insured, in breach of its contractual duty to the owner, failed to verify the roof design. The roof collapsed. The insured paid the owner's claim for damages and then sued the defendant insurer. The insurer issued a comprehensive liability policy which named the plaintiff as an insured. The insurer denied liability and alleged that the policy did not cover professional negligence or claims for defective work done. The trial court allowed the plaintiff's action and held the defendant insurer liable on the comprehensive liability policy.

On appeal to the Manitoba Court of Appeal the appeal was allowed and the action against the defendant insurer was dismissed.

On appeal to the Supreme Court of Canada the appeal was dismissed and the judgment of the Manitoba Court of Appeal was affirmed. The Supreme Court of Canada interpreted exclusions stated in the policy coverage and held that the policy did not cover professional negligence or claims for defective work done by the insured.

Insurance - Topic 6863

Liability insurance - Business, comprehensive policy - Extent of coverage - The plaintiff insured acted as a construction manager in connection with the construction of a cement manufacturing plant - The insured, in breach of its contractual duty to the owner, failed to verify the roof design of the plant - A roof beam collapsed - The insured paid the owner's claim for damages and then sued the defendant insurer - The insurer issued a comprehensive liability policy which named the plaintiff as an insured - The insurer denied liability and alleged that the policy did not cover professional negligence or claims for defective work done by the insured - The Supreme Court of Canada affirmed the dismissal of the plaintiff's action against the insurer.

Cases Noticed:

Dominion Bridge Company Limited v. Toronto General Insurance Company (1962), 37 W.W.R. 673, folld. [para. 7].

Canadian Indemnity Company v. Andrews & George Company Limited, [1953] 1 S.C.R. 19, folld. [para. 7].

Authors and Works Noticed:

Madge, Professional Indemnity Insurance, London, 1968, page 74 [para. 12].

MacGillivray, Insurance Law, 6th Ed., London, 1975, no. 2278 [para. 12].

Colinvaux, Law of Insurance, 3rd Ed., London, 1970, no. 600 [para. 12].

Appleman, Insurance Law and Practice, no. 7486, page 628 [para. 12].

Tinker, G.H., Comprehensive General Liability Insurance, FIC Quarterly, Spring 1975, page 217 [para. 12].

MacKay, D.J., Professional Negligence Insurance, 1971, 6 V.U.W. Law Review 119 [para. 12].

Counsel:

R.J. Scott and M.T. Green, for the appellant;

G. Jewers, Q.C. and K.D. Klein, for the respondents.

This appeal was heard by MARTLAND, RITCHIE, DICKSON, BEETZ and de GRANDPRE, JJ. at Ottawa, Ontario on October 21, 1976.

The judgment of the Supreme Court of Canada was delivered by de GRANDPRE, J. on February 8, 1977.