Ledlev Corporation Ltd. v. New York Underwriters Insurance Co.

Ledlev Corporation Ltd. v. New York Underwriters Insurance Co.

Article 1730 C.C. applies because the appellant contracted in good faith and the respondent had given reasonable cause to believe Jennens was authorized to sign the renewal subscription policy, shown by the prior policy and the fact the renewal was issued through the Jennens agency.

Citation
[1973] SCR 751
Parties
Appellant (plaintiff): Ledlev Corporation Ltd.; Respondent (defendant): New York Underwriters Insurance Company
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
18 October 1972
Procedural Posture
Civil Insurance Appeal / Appeal to the Supreme Court of Canada From the Court of Queen's Bench, Appeal Side, Province of Quebec
Outcome
Appeal allowed; judgment of trial court restored.
Legal Topics
Subscription Policy, Renewal, Agency Authority to Bind Insurer, Article 1730 Civil Code, Good Faith and Reasonable Cause
Source Language
English
Insurance Agency Contract Civil Code Quebec Subscription Policy Renewal Agency Authority to Bind Insurer Article 1730 Civil Code +1 more

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Parties

Ledlev Corporation Ltd.

Appellant (plaintiff)

New York Underwriters Insurance Company

Respondent (defendant)

Procedural Posture

Civil Insurance Appeal / Appeal to the Supreme Court of Canada From the Court of Queen's Bench, Appeal Side, Province of Quebec

Legal Issues

  1. 1 Whether the agent (Jennens) had authority to bind the insurer on the renewal subscription policy
  2. 2 Whether article 1730 of the Civil Code applies to hold the insurer liable where third party contracted in good faith with a person believed to be mandatary
  3. 3 Whether the insured acted in good faith and whether the insurer gave reasonable cause to believe the agent had authority

Ratio Decidendi

Article 1730 C.C. applies because the appellant contracted in good faith and the respondent had given reasonable cause to believe Jennens was authorized to sign the renewal subscription policy, shown by the prior policy and the fact the renewal was issued through the Jennens agency.

Court Disposition

Appeal allowed; judgment of trial court restored.

Orders

  • Appeal allowed
  • Judgment at trial restored