Clarendon National Insurance et al. v. Candow, 2007 ONCA 680

• Judge: MacPherson, Sharpe and Juriansz, JJ.A.
• Court: Court of Appeal (Ontario)
• Case Date: September 12, 2007
• Jurisdiction: Ontario
• Citations: 2007 ONCA 680;(2007), 229 O.A.C. 277 (CA)

Clarendon Nat. Ins. v. Candow (2007), 229 O.A.C. 277 (CA)

MLB headnote and full text

Temp. Cite: [2007] O.A.C. TBEd. OC.023

Clarendon National Insurance and Signothahack Bounthai (respondents/plaintiffs) v. Amanda A. Candow and Joan Candow (appellants/defendants)

(C46543; 2007 ONCA 680)

Indexed As: Clarendon National Insurance et al. v. Candow

Ontario Court of Appeal

MacPherson, Sharpe and Juriansz, JJ.A.

October 5, 2007.

Summary:

Bounthai resided in Ontario. He was an owner-operator for an American trucking company. His tractor was insured by Clarendon National Insurance (physical damage coverage) and American Home Assurance (liability coverage). Clarendon was located in the U.S. It was not a licensed insurance carrier under the Insurance Act and it did not file an undertaking to be bound by s. 263 of the Act. American Home, which was also a U.S. company, had filed an undertaking to be bound by s. 263. Bounthai was involved in a collision with the defendants in Toronto. Clarendon paid for the physical damage to Bounthai's tractor. Bounthai and Clarendon commenced a negligence action against the the defendants, seeking reimbursement of the amounts paid to repair the tractor. The defendants filed a statement of defence claiming that the action was barred by s. 263 of the Insurance Act. Bounthai and Clarendon moved for an order that s. 263 did not bar their action and for an order striking the paragraphs of the statement of defence that asserted that such a statutory bar existed.

The Ontario Superior Court, in a decision reported at [2007] O.T.C. 40, granted the orders. The court considered itself bound by the decision in Tuttle v. Travelers Indemnity Co. (Ont. C.A.) to permit Bounthai and his subrogated insurer to maintain their tort action against the defendants on the basis that the property damage payments that the insurer paid to the insured were not made under s. 263 of the Act. The defendants appealed.

The Ontario Court of Appeal allowed the appeal. The court held that Tuttle was distinguishable and that s. 263 barred the tort claim against the defendants.

Insurance - Topic 2886

Subrogation - Insurer limited to rights of insured - [See Insurance - Topic 5010.1 ].

Insurance - Topic 2896

Subrogation - Action by insurer - Statutory restrictions - [See Insurance - Topic 5010.1 ].

Insurance - Topic 5010.1

Automobile insurance - Compulsory government schemes - General - Limitation on causes of action - General (incl. when applicable) - Bounthai, an Ontario resident, was an owner-operator for an American trucking company - His tractor was insured by Clarendon National Insurance (physical damage coverage) and American Home Assurance (liability coverage) - Clarendon was located in the U.S. - It was not a licensed insurance carrier under the Insurance Act and it did not file an undertaking to be bound by s. 263 of the Act - American Home, which was also a U.S. company, had filed an undertaking to be bound by s. 263 - Bounthai was involved in a collision with the defendants in Toronto - Clarendon paid for the physical damage to Bounthai's tractor - Bounthai and Clarendon commenced a negligence action against the defendants, seeking reimbursement of the amounts paid to repair the tractor - The Ontario Court of Appeal held that its decision in Tuttle v. Travelers Indemnity Co. was distinguishable and s. 263 of the Insurance Act barred the tort claim against the defendants - Since Bounthai's liability insurer, American Home, had filed an undertaking under s. 226.1, all three criteria of s. 263(1) were met: Bounthai's vehicle suffered damage from an accident in Ontario, his vehicle was insured by an insurer that had filed an undertaking with the Superintendent, and another vehicle involved in the accident (the defendants' vehicle) was insured by a domestic insurer licensed to undertake automobile insurance in Ontario - Bounthai's tort action against the defendants was therefore barred by s. 263 and, consequently, Clarendon could not have the subrogated right to bring such an action.

Insurance - Topic 5242

Automobile insurance - Compulsory government schemes - Subrogation or indemnity - Limitations - [See Insurance - Topic 5010.1 ].

Cases Noticed:

Tuttle et al. v. Travelers Indemnity Co. et al. (2005), 196 O.A.C. 266; 75 O.R.(3d) 184 (C.A.), dist. [para. 2].

583809 Ontario Ltd. v. Kay (1995), 24 O.R.(3d) 445 (Gen. Div.), refd to. [para. 21].

A Plus Car & Truck Rental v. Pun, [1999] O.A.C. Uned. 130 (Div. Ct.), refd to. [para. 21].

Harpeet v. Markham (Town), [2006] O.J. No. 2439 (Sup. Ct.), refd to. [para. 21].

McClinton v. Estien, [2003] O.J. No. 5680 (Sup. Ct.), refd to. [para. 21].

McCourt Cartage Ltd. et al. v. Fleming Estate et al. (1997), 38 O.T.C. 230; 35 O.R.(3d) 795 (Gen. Div.), refd to. [para. 23].

Statutes Noticed:

Insurance Act, R.S.O. 1990, c. I-8, sect. 226.1 [para. 12]; sect. 263(1) [para. 8]; sect. 263(2) [para. 9]; sect. 263(5)(a.1) [para. 10]; sect. 263(5)(b) [para. 11].

Counsel:

Derek V. Abreu, for the appellants/defendants;

No one present for the respondents/plaintiffs.

This appeal was heard on September 12, 2007, before MacPherson, Sharpe and Juriansz, JJ.A., of the Ontario Court of Appeal. The following judgment of the Court of Appeal was delivered by Juriansz, J.A., and was released on October 5, 2007.