Linden v. CUMIS Life Insurance Co., 2015 NSCA 20

• Judge: Saunders, Hamilton and Fichaud, JJ.A.
• Court: Court of Appeal of Nova Scotia (Canada)
• Case Date: March 03, 2015
• Jurisdiction: Nova Scotia
• Citations: 2015 NSCA 20;(2015), 356 N.S.R.(2d) 288 (CA)

Linden v. CUMIS Life (2015), 356 N.S.R.(2d) 288 (CA);

    1126 A.P.R. 288

MLB headnote and full text

Temp. Cite: [2015] N.S.R.(2d) TBEd. MR.005

Wanda Linden, as personal representative of Patrick Linden (deceased) (appellant) v. CUMIS Life Insurance Company (respondent)

(CA 427262; 2015 NSCA 20)

Indexed As: Linden v. CUMIS Life Insurance Co.

Nova Scotia Court of Appeal

Saunders, Hamilton and Fichaud, JJ.A.

March 3, 2015.

Summary:

Linden died in May 2002 within two years of obtaining life and disability insurance. The defendant insurer refused to pay monthly disability benefits or life insurance proceeds on the ground that Linden's answers in a health questionnaire supplemental to his insurance application failed to disclose material facts respecting his health, which rendered the insurance contract void ab initio. Linden's widow applied for an order to force the insurer to pay both the disability benefits and the life insurance.

The Nova Scotia Supreme Court, in a judgment reported (2014), 343 N.S.R.(2d) 292; 1084 A.P.R. 292, dismissed the application. Linden misrepresented material facts known to him. He falsely answered "no" to the questions whether he had ever been a patient in a hospital, medical facility or treatment facility and whether he had ever received or been advised to have treatment for the use or abuse of drugs. As those material facts, considered objectively, would have affected the insurer's decision to accept the risk or charge a higher premium, the insurance contract was void ab initio. The widow appealed.

The Nova Scotia Court of Appeal dismissed the appeal.

Insurance - Topic 2446

Applicant's duty of disclosure - Materiality - Material matters - Linden died within two years of obtaining life and disability insurance - The insurer denied payment on the ground that his answers in a health questionnaire supplemental to his insurance application contained material misrepresentations respecting his health (since death less than two years since insurance obtained, insurer not required to prove material misrepresentation was fraudulent) - Linden had a history of treatment and hospitalization for depression, anxiety, eating disorders and alcohol and drug abuse - In response to ambiguous questions respecting depression and mental health issues, Linden stated that his last episode was 20 years ago, but his other answers clearly disclosed that he was currently seeing a psychiatrist and was off medication for only one month - The trial judge held that there was no material misrepresentation where Linden disclosed a significant period of depression up to and including the present - Linden did not materially misrepresent his struggles with depression - The failure to disclose multiple suicide attempts in response to a question about "other information about [his depression]" and a question concerning any other "mental or physical conditions" was not a material misrepresentation (confusing or vague question) - The failure to disclose a history of eating disorders constituted a material misrepresentation - Most importantly, Linden falsely answered "no" to the questions whether he had ever been a patient in a hospital, medical facility or treatment facility, and whether he had ever received or been advised to have treatment for the use or abuse of drugs - Those questions were clear - Linden had been a patient in both a hospital and medical facility, and had been treated for substance abuse at a treatment facility - Linden had obtained treatment for substance abuse and such treatment had been recommended on multiple occasions - As those material facts, considered objectively, would have affected the insurer's decision to accept the risk or charge a higher premium, the insurance contract was void ab initio - The Nova Scotia Court of Appeal affirmed material misrepresentation voiding the policy - The trial judge committed no extractable error of law or palpable and overriding error of fact - See paragraphs 1 to 49.

Insurance - Topic 2481

Applicant's duty of disclosure - Default in duty to disclose - Remedies of insurer - [See Insurance - Topic 2446 ].

Cases Noticed:

Belmont Financial Group Inc. v. Trisura Guarantee Insurance Co. (2008), 269 N.S.R.(2d) 143; 860 A.P.R. 143; 2008 NSCA 87, refd to. [para. 20].

Hants Realty Ltd. v. Travelers Guarantee Co. of Canada (2014), 347 N.S.R.(2d) 184; 1098 A.P.R. 184; 2014 NSCA 69, refd to. [para. 20].

United Gulf Developments Ltd. et al. v. Iskandar et al. (2008), 267 N.S.R.(2d) 318; 853 A.P.R. 318; 2008 NSCA 71, refd to. [para. 22].

Eli Lilly & Co. et al. v. Novopharm Ltd. et al., [1998] 2 S.C.R. 129; 227 N.R. 201, refd to. [para. 23].

Creston Moly Corp. v. Sattva Capital Corp. (2014), 461 N.R. 335; 358 B.C.A.C. 1; 614 W.A.C. 1; 2014 SCC 53, refd to. [para. 24].

Canadian National Railway Co. v. Halifax (Regional Municipality) (2014), 353 N.S.R.(2d) 18; 1115 A.P.R. 18; 2014 NSCA 104, refd to. [para. 26].

Henwood v. Prudential Insurance Co. of America, [1967] S.C.R. 720, refd to. [para. 29].

Innocente v. Canada (Attorney General) (2012), 315 N.S.R.(2d) 273; 998 A.P.R. 273; 2012 NSCA 36, refd to. [para. 54].

Counsel:

Ronan W. Holland and Aileen K. McGinty, for the appellant;

Karen N. Bennett-Clayton and Jennifer L. Taylor, for the respondent.

This appeal was heard on February 3, 2015, at Halifax, N.S., before Saunders, Hamilton and Fichaud, JJ.A., of the Nova Scotia Court of Appeal.

On March 3, 2015, Fichaud, J.A., delivered the following judgment for the Court of Appeal.