Tedford v. TD Insurance Meloche Monnex

• Jurisdiction: Ontario
• Judge: Lang, Epstein and Hoy, JJ.A.
• Date: 05 April 2012
• Citation: (2012), 292 O.A.C. 374 (CA),2012 ONCA 429
• Court: Court of Appeal (Ontario)

Tedford v. TD Ins. (2012), 292 O.A.C. 374 (CA)

MLB headnote and full text

Temp. Cite: [2012] O.A.C. TBEd. JL.001

Damon Tedford (applicant/respondent) v. TD Insurance Meloche Monnex (respondent/appellant)

(C54479; 2012 ONCA 429)

Indexed As: Tedford v. TD Insurance Meloche Monnex

Ontario Court of Appeal

Lang, Epstein and Hoy, JJ.A.

June 22, 2012.

Summary:

Tedford was the defendant in an action alleging that he made negligent misrepresentations in the property information statement that he completed in connection with the sale of his home. The plaintiff in that action sought damages of $150,000 relating to repair costs and of $25,000 for "health consequences". At the time of the alleged misrepresentations, Tedford held a homeowner's insurance policy. At issue was whether the insurer was obligated to defend Tedford in the action.

The Ontario Superior Court, in a decision reported at [2011] O.T.C. Uned. 5500, held that the insurer had a duty to defend Tedford. The insurer appealed.

The Ontario Court of Appeal allowed the appeal in part.

Insurance - Topic 725

Insurers - Duties - Duty to defend - Tedford was the defendant in an action alleging that he made negligent misrepresentations in the property information statement that he completed in connection with the sale of his home - The plaintiff in that action sought damages of $150,000 relating to repair costs and of $25,000 for "health consequences" - At the time of the alleged misrepresentations, Tedford held a homeowner's insurance policy - An application judge found that the insurer had a duty to defend Tedford in the action because the health consequences amounted to "Bodily Injury" within the coverage of the policy - On appeal, the insurer asserted that the true nature of the plaintiff's claim was one for economic loss and that the claim for health consequences was derivative of that such that it was not determinative of whether the insurer had a duty to defend - The Ontario Court of Appeal rejected this argument - There was only one cause of action being advanced: negligent misrepresentation - The general damages for health consequences sought by the plaintiff represented a different category of damages resulting from the negligent misrepresentation and not a derivative claim - There was no error in the application judge's assessment of the true nature of the bodily injury portion of the action - See paragraphs 15 to 18.

Insurance - Topic 725

Insurers - Duties - Duty to defend - Tedford was the defendant in an action alleging that he made negligent misrepresentations in the property information statement that he completed in connection with the sale of his home - The plaintiff in that action sought damages of $150,000 relating to repair costs and of $25,000 for "health consequences" - At the time of the alleged misrepresentations, Tedford held a homeowner's insurance policy - An application judge found that the insurer had a duty to defend Tedford in the action because the health consequences amounted to "Bodily Injury" within the coverage of the policy - On appeal, the insurer asserted that, because the amount of damages related to health consequences was small in comparison to the claim for repair costs, it was unreasonable for the insurer to be required to bear the costs of defending the entire claim - The Ontario Court of Appeal agreed - An insurer was responsible for all reasonable costs associated with the defence of a covered claim - Here, the covered claim represented a small portion of the total damages claimed - The insurer was to defend both the covered and uncovered claims - Tedford was to bear the costs of the defence to the extent that they exceeded the reasonable costs associated with the defence of the covered claim - See paragraphs 19 to 25.

Insurance - Topic 6818

Liability insurance - Homeowner's comprehensive policy - Duty of insurer to defend - [See both Insurance - Topic 725 ].

Cases Noticed:

Non-Marine Underwriters, Lloyd's of London v. Scalera - see Scalera v. Lloyd's of London.

Scalera v. Lloyd's of London, [2000] 1 S.C.R. 551; 253 N.R. 1; 135 B.C.A.C. 161; 221 W.A.C. 161; 2000 SCC 24, refd to. [para. 4].

Monenco Ltd. et al. v. Commonwealth Insurance Co. et al., [2001] 2 S.C.R. 699; 274 N.R. 84; 155 B.C.A.C. 161; 254 W.A.C. 161; 2001 SCC 49, refd to. [para. 14].

1540039 Ontario Ltd. v. Farmers' Mutual Insurance Co. (2012), 291 O.A.C. 16; 2012 ONCA 210, refd to. [para. 14].

Hanis v. Teevan - see Hanis v. University of Western Ontario et al.

Hanis v. University of Western Ontario et al. (2008), 241 O.A.C. 303; 92 O.R.(3d) 594; 2008 ONCA 678, refd to. [para. 19].

Riocan Real Estate Investment Trust v. Lombard General Insurance Co., [2008] O.T.C. Uned. 741; 91 O.R.(3d) 63 (Sup. Ct.), dist. [para. 23].

Counsel:

Marc D. Isaacs and Bonnie Huen, for the appellant;

Danesh Rana, for the respondent.

This appeal was heard on April 5, 2012, by Lang, Epstein and Hoy, JJ.A., of the Ontario Court of Appeal. On June 22, 2012, Hoy, J.A., delivered the following judgment for the court.