Shinkaruk Enterprises Ltd. v. Commonwealth Insurance Co. et al., (1988) 67 Sask.R. 294 (QB)

• Judge: Wedge, J.
• Court: Court of Queen's Bench of Saskatchewan (Canada)
• Case Date: April 29, 1988
• Jurisdiction: Saskatchewan
• Citations: (1988), 67 Sask.R. 294 (QB)

Shinkaruk Ent. v. Commonwealth Ins. (1988), 67 Sask.R. 294 (QB)

MLB headnote and full text

Shinkaruk Enterprises Ltd. v. Commonwealth Insurance Company, Northumberland General Insurance Company, Gerling Global General Insurance Company, Scottish & York Insurance Company Limited, The Canadian Indemnity Company, and Paragon Insurance Company of Canada

(Q.B. 2399 of 1983)

Indexed As: Shinkaruk Enterprises Ltd. v. Commonwealth Insurance Co. et al.

Saskatchewan Court of Queen's Bench

Judicial Centre of Saskatoon

Wedge, J.

April 29, 1988.

Summary:

An insured corporation lost a building, inventory and equipment in a fire. The insured brought an action against its insurers to enforce its claim under a fire insurance policy. The trial of the action was split and the following two issues were directed to be determined: (1) whether the loss was to be valued on the basis of actual value or replacement cost and (2) whether the loss was to be valued under the mandatory appraisal provisions of the Saskatchewan Insurance Act.

The Saskatchewan Court of Queen's Bench held that the value of the building, inventory and equipment was to be based on actual cash value. The court also held that the action was not to be stayed to allow the appraisal procedure under the Act to be complied with.

Insurance - Topic 5852

Fire insurance - The loss - Measure of - Actual cash value v. replacement cost - An insured claimed a fire insurance policy provided for valuing the insured building, inventory and equipment at replacement cost, rather than actual cash value - An endorsement in the policy provided that the building was to be valued at actual cost - The insured had notice of and consented to the endorsement - The policy also clearly provided that equipment was to be valued at actual cost - Inventory was to be valued at replacement cost, but only where it was replaced or repaired with due diligence and dispatch - Five years elapsed since the trial and the insured had yet to replace or repair the inventory - There was no evidence that the insured ever intended to do so - The Saskatchewan Court of Queen's Bench held that five years was unreasonable, therefore; the building, inventory and equipment were all to be valued at their actual cash or depreciated value - See paragraphs 8 to 21.

Insurance - Topic 5856

Fire insurance - The loss - Appraisal - Saskatchewan Insurance Act, R.S.S. 1978, c. S-26, s. 128 - Sections 108 and 128, statutory condition 11, provided for mandatory appraisal of the value of insured property in the event of a disagreement - An insured, by its conduct, continually obstructed and frustrated the appraisal procedure - The insured subsequently applied for a stay of its action against the insurers, seeking to invoke the abandoned appraisal procedure - The Saskatchewan Court of Queen's Bench refused to order compliance with ss. 108 and 128 - The court stated that continuation of the action would not prejudice the insured - The court stated that it was of little importance whether its refusal to invoke the procedure was based on the insured being estopped from seeking appraisal or on the courts refusal to exercise its discretion to order compliance - See paragraphs 22 to 48.

Cases Noticed:

Katsiris v. Saskatchewan Government Insurance (1983), 24 Sask.R. 178, dist. [para. 15].

Cedar Hut Restaurant v. Wawanesa Mutual Insurance Co., [1985] 5 W.W.R. 673; 41 Sask.R. 151, refd to. [para. 16].

Wilson v. Canadian General Insurance, 25 C.C.L.I. 174, refd to. [para. 17].

White Spot Ltd. v. Continental Insurance (1986), 21 C.C.L.I. 191, refd to. [para. 18].

Arlington Investment Ltd. v. Commonwealth Insurance Co. (1985), 8 C.C.L.I. 153 (B.C.C.A.), refd to. [para. 27].

Shinkaruk Enterprises and Mr. Klean Enterprises Ltd. v. Commonwealth Insurance Company et al. (1986), 56 Sask.R. 217, refd to. [para. 31].

Pfeil v. Simcoe & Erie General Insurance Co. and McQueen Agencies Ltd., [1986] I.L.R. 2055; 45 Sask.R. 241, refd to. [para. 32].

Brown's Mobile Homes Ltd. v. Royal Insurance Co. Ltd. (1965), 54 W.W.R.(N.S.) 490, refd to. [para. 46].

Statutes Noticed:

Saskatchewan Insurance Act, R.S.S. 1978, c. S-26, sect. 108 [para. 24]; sect. 128, stat. cond. 6 [para. 36]; sect. 128, stat. cond. 11 [para. 25].

Authors and Works Noticed:

Brown and Menezes, Insurance Law In Canada, p. 302, s. 14.7.4 [para. 45].

Counsel:

P. Skinkaruk, for the plaintiff;

W.B. Purdy, for the defendants.

This action was heard before Wedge, J., of the Saskatchewan Court of Queen's Bench, Judicial Centre of Saskatoon, who delivered the following judgment on April 29, 1988.