Miller v. Guardian Insurance Co. of Canada et al., (1995) 175 A.R. 382 (QB)

• Judge: Mason, J.
• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: September 15, 1995
• Citations: (1995), 175 A.R. 382 (QB)

Miller v. Guardian Ins. Co. (1995), 175 A.R. 382 (QB)

MLB headnote and full text

Garry Brent Miller (plaintiff) v. Guardian Insurance Company of Canada, Brian Kane Insurance Agencies Ltd. and Catherine Main (defendants)

(Action No. 8901-13475)

Indexed As: Miller v. Guardian Insurance Co. of Canada et al.

Alberta Court of Queen's Bench

Judicial District of Calgary

Mason, J.

September 15, 1995.

Summary:

Boyko and Miller were motorcycling together in 1985. Boyko lost control of his motorcycle. Miller took evasive action to avoid a collision. He fell and was perma­nently paralyzed. Miller obtained a consent judgment against Boyko for $850,000. Boyko's third party liability limit was $100,000. Miller's policy did not include underinsured motorist coverage (S.E.F. 42). Miller sued his insurer (Guardian), his insur­ance agency (Kane) and his insurance agent (Main) for breach of contract, misrepresen­tation, negligence and rectification for failing to provide the coverage. Guardian and Kane/Main issued third party proceedings against each other, claiming contribution and indemnity.

The Alberta Court of Queen's Bench allowed Miller's action against all the defen­dants, but held him 10% contributorily negligent. The court dismissed Kane/Main's third party proceeding against Guardian. The court dismissed Guardian's third party pro­ceeding against Kane with the exception of the premiums due for the underinsured motorist coverage. The court ordered that Guardian, Main and Kane each bear their own costs.

Agency - Topic 3025

Relations between principal and agent - Agent's liability - For acts of principal - The plaintiff was injured in a motorcycle accident - Guardian insured both the plaintiff and the defendant - Guardian agreed to a consent judgment for $850,000 - The defendant's liability limit was $100,000 - The plaintiff did not have underinsured motorist (S.E.F. 42) coverage - The plaintiff sued his insurance agency, his insurance agent and Guardian - The Alberta Court of Queen's Bench held that the agency was negligent in not providing the coverage, that the agency was Guardi­an's agent, and that Guardian as principal was also accountable - The court rejected the agency's submission that it was not bound by the consent judgment, holding that the agency was bound by the act of its principal in consenting to the quantum of damages - See paragraphs 62, 63.

Deeds and Documents - Topic 5051

Rectification - When available - The plaintiff sued his insurer, his insurance agency and his insurance agent for breach of contract, misrepresentation, negligence and rectification because he did not have underinsured motorist coverage (S.E.F. 42) - The Alberta Court of Queen's Bench held that the agency was negligent and the insurer, as principal, was accountable for the agent's negligence - The court stated that the remedy of rectification, germane in the domain of contract, was not applicable here - The insured was entitled to restitu­tionary damages - See paragraphs 54 to 56.

Insurance - Topic 402

Agents - Agent - What constitutes - An insurance agency acquired a high risk insurance policy for the plaintiff - The Alberta Court of Queen's Bench listed four categories of insurance agents: general or managing agents, recording agents, solicit­ing agents and brokers - The court deter­mined that the plaintiff's agency was a recording agent for the insurer - The court considered, inter alia, that the agent had the power to bind the insurer - See para­graphs 41 to 47 - Although the agency was an agent for both the plaintiff and the insurer (dual agency) it was the insurer's agent at all material times - As a result the insurer was accountable for any negli­gence by the agency - See paragraphs 48 to 53.

Insurance - Topic 503

Agents - Liability of agent - To indem­nify insurer - The Alberta Court of Queen's Bench held that an insurance agency was negligent in failing to provide an insured with underinsured motorist (S.E.F. 42) coverage - The court found that the agency was the insurer's agent and the insurer was accountable for the agent's negligence - However, if the agent had not been negligent, the insured would have received the coverage and the insurer would have been liable to compensate the insured in any event - The court dismissed the insurer's third party claim for contribu­tion and indemnity against the agency, with the exception of the premiums due for the underinsured motorist coverage - See paragraphs 57 to 61.

Insurance - Topic 542

Agents - Liability of insurer for acts of agent - Failure to inform insured of avail­able coverage - [See Insurance - Topic 503 ].

Insurance - Topic 545

Agents - Liability of insurer for acts of agent - Negligence - [See Insurance - Topic 503 ].

Insurance - Topic 549

Agents - Liability of insurer for acts of agent - Vicarious liability - [See Insur­ance - Topic 503 ].

Torts - Topic 6601

Defences - Contributory negligence - What constitutes contributory negligence - The plaintiff was injured in an accident - Consent judgment for $850,000 was entered - The defendant's liability limit was $100,000 - The plaintiff did not have underinsured motorist (S.E.F. 42) coverage - The Alberta Court of Queen's Bench held that the plaintiff's agent was negligent in failing to acquaint him adequately with underinsured motorist coverage (later family protection (S.E.F. 44) coverage) - The court found that the plaintiff was 10% contributorily negligent - He undertook a comparison and review of his truck and motorcycle policies and requested that his agent increase his motorcycle's liability limits and theft coverage, but failed to inquire why the truck, unlike the motor­cycle, had S.E.F. 44 coverage - See para­graphs 23 to 40.

Cases Noticed:

Fletcher v. Manitoba Public Insurance Co., [1990] 3 S.C.R. 191; 116 N.R. 1; 71 Man.R.(2d) 81; 44 O.A.C. 81, refd to. [paras. 23, 31, 40].

Stephenson v. Kerekanich et al.; Central Peace Dairies Ltd. v. Stephenson and Kerekanich (1976), 2 A.R. 198; 1 Alta. L.R.(2d) 354 (T.D.), refd to. [para. 29].

Fine's Flowers Ltd. v. General Accident Assurance Co. of Canada (1977), 81 D.L.R.(3d) 139 (Ont. C.A.), refd to. [para. 31].

Unruh (Peter) Construction Co. v. Kelly-Lucy & Cameron Adjusters Ltd., [1976] I.L.R. 203 (Alta. T.D.), refd to. [paras. 34, 35].

Jessett v. Conacher, [1981] I.L.R. 1-1429; 30 A.R. 489 (Q.B.), refd to. [paras. 34, 35].

Piggott Construction Ltd. v. Saskatchewan Government Insurance (1985), 44 Sask.R. 203; 16 C.C.L.I. 204 (C.A.), refd to. [paras. 48, 52].

Boutilier v. Traders General Insurance Co. (1968), 1 D.L.R.(3d) 379 (N.S.T.D.), refd to. [para. 50].

Kelly v. Wawanesa Mutual Insurance Co. and Cochrane Brothers Insurance Con­sultants Ltd. (1979), 30 N.S.R.(2d) 294; 49 A.P.R. 294; 98 D.L.R.(3d) 29 (C.A.), refd to. [para. 50].

Gilvesy v. Mayorscak (Steve) Insurance Agency Ltd., [1978] I.L.R. 1347 (Ont. Co. Ct.), refd to. [para. 59].

Bos v. Brauer et al. (1992), 174 A.R. 137; 102 W.A.C. 137; 3 Alta. L.R.(3d) 318 (C.A.), refd to. [para. 60].

Authors and Works Noticed:

MacGillvray and Parkington, Insurance Law (6th Ed. 1975), p. 497, para. 1182 [para. 55].

Preston and Colinvaux, Laws of Insurance (1950), p. 291 [para. 35].

Special Lectures of the Law Society of Upper Canada 1962, Claims Under Insurance Policies, pp. 253, 254 [para. 42].

Counsel:

E.S. Pipella, Q.C., R.H. Edwards and M.B. Warren, for the plaintiff, Garry Brent Miller;

A.G. Shewchuk, for the defendant, Guard­ian Insurance Company of Canada;

C.S. Brooker, Q.C., and P.W. Nykyforuk, for the defendants, Brian Kane Insurance Agencies Ltd. and Catherine Main.

This action was heard by Mason, J., of the Alberta Court of Queen's Bench, Judicial District of Calgary, who delivered the fol­lowing decision on September 15, 1995.