Fiery Foundations of Federalism: The Enduring Legacy of Citizens Insurance Co v Parsons

• Author: Bruce Ryder
• Pages: 639-664



FieryFoundationsofFederalism

TH EE ND UR IN GLE GAC YO F

CITIZENS INSURANCE CO

v PARSONS

Bruce Ryder*

“. . . the Parson s case, they all go back to the Parson s case . . . .”

A . INTRODUCT ION

Onehundred andfortyyears agonot longafterthe tenthanniversary

ofConfederationon thenightof AugustWilliam Parsonsgen

eralhardwarestoreonthesouthsideofBroadwaythemaincommercial

streetinthetownofOrangevi lleOntariowasdestroyedbyre

Fires were a common occurrence on Broadway and elsewhere

throughoutthenewprovinceofOntarioandtheresultswereoftendev

astatingparticula rlysincemanybuildingsatthetimewereconstructed

oflumberParsonshad nolessthanten insurancepoliciesinsuringhis

storebuildi ngsandhis stockagainst losscausedby reAha ndfulof

companiesrefusedtoindemnifyParsonsforhislossesallegingthathe

hadviolatedtheconditionsofhisins urancecontractsParsonsledsuit

against eachoft hemseeking recoveryCentral tohis legalargu ments

 AssociateProfes sorOsgoodeHallLawSc hoolYorkUniversityTheauthorwould

liketothan kVanessaLiooftheDu erinCountyMuseumandArc hivesforher

invaluablea ssistance

 Aremark madebyLoui sStLaurent counselfort heAorneyGenera lofCanada

duringhissubmission stotheSupremeCourtofCanadainReference Re Natural Prod-

ucts Marketing Act (Canada)SCR asquotedi nJohnT SaywellThe Law -

makers JudicialPowerand theShapingof CanadianFederalism TorontoUnivers ityof

TorontoPressat

BR

wasthefailureofthecompaniestocomplywiththerequirementsofAn

Act to Secure Uniform Conditions in Policies of Fire Insurancethe Fire Insur-

ance ActenactedbytheOntariolegislatu rein

The litigation journey that ensued was a long one with stops in

GuelphTorontoOawaandLondonBythetimethecasewasheaded

tothe JudicialCommieeof thePrivyCounci lParsonswasi nsolvent

Ne itherhe nor his tr ust ees rec over eda nyp aym entsaf ter the Pri vyC oun 

cilsrulingfrom eitherCitizensInsurance orQueenInsurancethe two

companiesth atpursuedtheir appealsall thewayto LondonParsons

claimsagai nsttheminhis famouscasethusended upyielding himno

nancialreliefitonlyaddedtothecostsofh iseortstorecoverfrom

thedestruct ionofhisbusinessButt hePrivyCouncilrul inginCitizen s

Insurance Co v Parso nsdidma keremarkablyenduringcontributionsto

shaping the constitutional st ructure of the young countr y born just a

decadebeforehishardwarestoreburnedtotheground

PartBofthis paperoutlinest hefrequencyofresandthebusi ness

practicesofr einsurancecompanies inthesthatled totheenact

mentoftheFire Insurance Actby theOnta riolegis laturePar tCdescr ibes

someof thelocal conditionsinOrangevilleand presentsafew details

aboutWill iamParsons lifeand theca lamitousseries ofres thatde

stroyedbuildingsonBroadwayinthesPartCalsosummari zesthe

proceedings atthe lowercourts inParsons successfulact ionsagainst

the insurance companies t hat had refused to indemnify him for h is

lossesresu ltingfromt herePart Dsituates theissuesraisedby

Citizens Insurance Co v Parsonsint helargerconstitutionaldebatesatthe

timebeforetu rningtoananalysisoftheSupremeCourtofCanadaand

Privy Councilruli ngsthat upheld theFire Insuranc e Actasavalidex

erciseof provincialjurisdict ionpursuantto sectionoftheB ritish

North America ActPartDalsofoc usesonthreefeatur esofSirMontague

Smithsopiniononbehalfoft hePrivyCouncilthathavehad anendur

ingimpactonCanadianfederalism

The rstenduring featureof thePar sons opinionis itsarmation

ofa v ision I will call equal federalism one that sees the provi ncial

legislaturesandtheDominionParliamentasequalinpowersandstatus

This visioncontraststo thevision Iwill callimperialfederali smfa

vouredby severaljustices oftheSupreme Courtof Canadain thelate

sand earlys Imperialfederalists thoughtof the relationship

between theDominion andthe provincesi nama nnerthat replicated

 SOVictc

 AppCasPCParsons