West End Investment Co. v. Commerce & Industry Insurance Co. et al., (1976) 11 N.R. 541 (SCC)

• Judge: Laskin, C.J.C., Martland, Judson, Ritchie, Spence, Pigeon, Dickson, Beetz and de Grandpré, JJ.
• Court: Supreme Court (Canada)
• Case Date: December 11, 1975
• Jurisdiction: Canada (Federal)
• Citations: (1976), 11 N.R. 541 (SCC)

West End Inv. v. Commerce & Ind. Ins. (1976), 11 N.R. 541 (SCC)

MLB headnote and full text

West End Investment Co. v. Commerce & Industry Insurance Co. et al.

Indexed As: West End Investment Co. v. Commerce & Industry Insurance Co. et al.

Supreme Court of Canada

Laskin, C.J.C., Martland, Judson, Ritchie, Spence, Pigeon, Dickson, Beetz and de Grandpré, JJ.

June 29, 1976.

Summary:

This case arose out of a claim by an insured under a fire insurance policy following a fire loss of a hotel building. The defendant insurer issued a fire insurance policy which insured the hotel. The claimant was an unpaid seller of the hotel and was a named insured in the fire insurance policy but the nature of his interest in the hotel was not stated in the policy contrary to s. 240(10)(a) of the Insurance Act. The claimant commenced an action and the insurer raised s. 240(10)(a) of the Insurance Act as a defence. The trial court allowed the plaintiff's action and ordered the defendant insurer to pay $50,000.00 to the plaintiff.

On appeal to the Quebec Court of Appeal the appeal was dismissed and the judgment of the trial court was affirmed.

On appeal to the Supreme Court of Canada the appeal was dismissed and the judgment of the Quebec Court of Appeal was affirmed. The Supreme Court of Canada referred to s. 240(1) of the Quebec Insurance Act and held that the insurer was precluded from raising s. 240(1)(a) as a defence unless the insurer could show that it was prejudiced by the omission in the policy of a statement of the nature of the plaintiff's interest in the hotel.

The Supreme Court of Canada referred to the word "owned" in s. 240(10)(a) of the Insurance Act and stated that for purposes of a fire insurance policy that an owner of property includes a person in whom the property has become temporarily beneficially vested and who has occupation or control of the property - see paragraphs 17 to 20.

Insurance - Topic 3141

Payment of insurance proceeds - Relief against forfeiture for failure by insured to comply with statutory conditions concerning insurance interest - Quebec Insurance Act, s. 240(1) and s. 240(10)(a) - An unpaid seller of a hotel was named as an insured in a fire insurance policy but the nature of his interest was not stated in the policy contrary to s. 240(10)(a) of the Insurance Act - The Supreme Court of Canada held that the insurer was precluded from raising s. 240(10)(a) as a defence to a claim by the insured unless the insurer could show that it was prejudiced by the omission by the insured.

Insurance - Topic 5752

Fire insurance - Insurable interest - Ownership of property insured - The Supreme Court of Canada interpreted s. 240(10)(a) of the Quebec Insurance Act and held that an owner of property includes a person in whom the property has been temporarily beneficially vested and who has occupation or control of the property - See paragraphs 17 to 20.

Insurance - Topic 1103

The contract - Formation of the contract - Oral agreements - The Supreme Court of Canada stated that an insurance contract is not a solemn contract and may be concluded in any form - See paragraph 7.

Words and Phrases

Owned - The Supreme Court of Canada discussed the meaning of the word "owned" as found in s. 240(10)(a) of the Quebec Insurance Act - See paragraphs 17 to 20.

Cases Noticed:

La Compagnie d'Assurance Stanstead and Sherbrooke v. Fabi, [1960] Qué. Q.B. 601, folld. [paras. 4, 29].

Agnew-Surpass Shoe Stores Ltd. v. Cummer-Yonge Investments (1975), 4 N.R. 547; 55 D.L.R.(3d) 676, refd to. [para. 16].

Pantel v. Air Canada, 1 N.R. 79; [1975] 1 S.C.R. 472, refd to. [para. 18].

Wandlyn Motels v. Commerce General Insurance Company, 1 N.B.R.(2d) 213; 3 N.B.R.(2d) 6; [1970] S.C.R. 992, folld. [para. 20].

Ritchie and Dobbie v. Stanstead and Sherbrooke Fire Insurance Company, [1940] I.L.R. Vol. 7, p. 41, folld. [paras. 20, 37].

Keefer v. Phoenix Insurance Co. of Hartford (1900), 31 S.C.R. 144, folld. [para. 21].

Caldwell v. Stadacona Fire (1883), 11 S.C.R. 212, folld. [para. 21].

North Empire Fire Insurance Co. v. Vermette, [1943] S.C.R. 189, dist. [para. 24]; refd to. [para. 32].

Summers v. Commercial Union Assurance Company, 6 S.C.R. 19, folld. [para. 33].

Canadian Fire Insurance Company v. Robinson, 31 S.C.R. 488, folld. [para. 33].

Canadian Home Assurance Company v. Gauthier, [1966] S.C.R. 305, folld. [para. 33].

Car and General Insurance Corporation Limited v. Therrien, [1969] Q.B. 144, folld. [para. 33].

Statutes Noticed:

Quebec Civil Code, Art. 2571 [para. 5]; art. 2572 [para. 12]; art. 2480 [para. 5].

Insurance Act, R.S.Q. 1964, c. 295, sect. 240(1) [para. 13]; sect. 240(10)(a) [para. 17].

Authors and Works Noticed:

Mignault, Le Droit Civil Canadien, Vol. 7, p. 233 [para. 37].

Williams, Canadian Law of Landlord and Tenant, 4th Ed., 1973, p. 1 [para. 37].

Counsel:

Robert Boyer, for the appellant;

Robert S. Litvack, for the respondent.

This appeal was heard by the Supreme Court of Canada at Ottawa, Ontario on December 11, 1975. Judgment was delivered by the Supreme Court of Canada on June 29, 1976 and the following opinions were filed:

PIGEON, J. - see paragraphs 1 to 25.

de GRANDPRE, J. - see paragraphs 26 to 40.

LASKIN, C.J.C., MARTLAND, JUDSON, RITCHIE, SPENCE, DICKSON and BEETZ, JJ. concurred with PIGEON, J.