National Bank of Canada v. Co-operators General Insurance Co., (1988) 90 A.R. 295 (CA)

• Judge: Laycraft, C.J.A., McClung and Kerans, JJ.A.
• Court: Court of Appeal (Alberta)
• Case Date: November 03, 1988
• Citations: (1988), 90 A.R. 295 (CA)

Nat. Bk. v. Co-op General (1988), 90 A.R. 295 (CA)

MLB headnote and full text

Co-operators General Insurance Company formerly Co-operative Fire and Casualty Company (appellants) v. National Bank of Canada (respondent)

(No. 8803-0198AC)

Indexed As: National Bank of Canada v. Co-operators General Insurance Co.

Alberta Court of Appeal

Laycraft, C.J.A., McClung and Kerans, JJ.A.

November 3, 1988.

Summary:

A mortgagee applied for recovery under an insurance policy for a fire loss where the insurer was not liable to the insured mortgagor. The mortgagee also applied for rectification of the insurance policy which was issued to the mortgagor without the standard mortgage clause due to an oversight.

The Alberta Court of Queen's Bench ordered rectification and gave judgment to the mortgagee against the insurer. The decision of the Court of Queen's Bench is not reported in this series of reports. The insurer appealed.

The Alberta Court of Appeal dismissed the appeal but found that rectification was unnecessary.

Deeds and Documents - Topic 5008

Rectification - When unnecessary, oral contract - A mortgagee applied for rectification of an insurance policy which was issued without the standard mortgage clause due to an oversight - The Alberta Court of Appeal held that rectification was unnecessary, because of the existence of a complete oral contract between the mortgagee and the insurer (see paragraph 29).

Insurance - Topic 5963

Fire insurance - Loss payable to mortgagee - Nature of mortgagee's interest - The Alberta Court of Appeal held that a mortgage clause in an insurance policy resulted in a separate contract of insurance between the mortgagee and the insurer which is "engrafted on to the policy delivered to the mortgagor" (see paragraph 24).

Cases Noticed:

National Fire Insurance Company of Hartford v. Emerson (1912), 22 B.C.R. 349, refd to. [para. 13].

Hastings v. Westchester Fire Insurance Co. (1878), 73 N.Y. 141, refd to. [para. 14].

Laidlaw v. Hartford Fire Insurance Company (1916), 29 D.L.R. 229, refd to. [para. 16].

Industrial Development Bank v. Fayad (1976), 5 A.R. 451; 71 D.L.R.(3d) 152, refd to. [para. 16].

Agricultural Savings & Loan Co. v. Liverpool & London & Globe Ins. Co. (1901), 3 O.L.R. 127, revsd. (1903), 33 S.C.R. 94, refd to. [para. 17].

London L. & S. Co. of Canada v. Union Ins. Co. of Canton Ltd., [1925] 4 D.L.R. 677, affd. [1925] 4 D.L.R. 676, refd to. [para. 18].

London & Midland General Insurance Co. v. Bonser (1972), 29 D.L.R.(3d) 468, refd to. [para. 20].

Braaten & Braaten v. Yorkshire Trust Company (1984), 57 B.C.L.R. 182, refd to. [para. 24].

Federal Business Development Bank v. American Home Assurance Co., [1986] I.L.R. 8024 (Ont. S.C.), refd to. [para. 24].

Canadian Imperial Bank of Commerce v. Dominion of Canada General Insurance Co. et al., [1988] I.L.R. 8840 (B.C.S.C.), refd to. [para. 24].

Statutes Noticed:

Insurance Act, R.S.A. 1980, c. I-5, sect. 234(1) [para. 11].

Authors and Works Noticed:

Heighton, Angus C., Insurance and the Mortgagee (1949), 27 Can. Bar Rev. 879 [para. 13].

Couch on Insurance (2nd Ed.), vol. 10A, para. 42:728 [para. 14].

Counsel:

R.P. Belzil, for the appellants;

J.P. Warner, Q.C., for the respondent.

This appeal was heard by Laycraft, C.J.A., McClung and Kerans, JJ.A., of the Alberta Court of Appeal. The decision of the Court of Appeal was delivered by Laycraft, C.J.A., at Edmonton, Alberta, on November 3, 1988.