Lind v. Canadian Northern Shield Insurance Co.

2001BCCA0229 Citation: Lind v. Canadian Northern Shield Insurance Company Date: 20010315 2001 BCCA 229 Docket: CA027619 Registry: Vancouver COURT OF APPEAL FOR BRITISH COLUMBIA ORAL REASONS FOR JUDGMENT Before: The Honourable Madam Justice Prowse March 15, 2001 The Honourable Mr. Justice Hall The Honourable Madam Justice Saunders Vancouver, B.C. BETWEEN: JULIA MAE LIND RESPONDENT AND: CANADIAN NORTHERN SHIELD INSURANCE COMPANY APPELLANT R.B.T. Goepel, Q.C. and J.A. Fishman appearing for the Appellant R.E. Turner appearing for the Respondent [1] PROWSE, J.A.: Canadian Northern Shield Insurance Company ("Canadian") is appealing from the order of a chambers judge, made August 4, 2000 pursuant to Rule 18A of the Rules of Court, in the following terms: THIS COURT ORDERS that: 1. The policy of homeowners insurance provided by the defendant Canadian Northern Shield Insurance Company covers the losses sustained by the plaintiff as a result of water damage to lands and premises located at 3300 Fraser Road, Duncan, B.C., which occurred on or about February 15, 1996. 2. The application of the defendant Canadian Northern Shield Insurance Company for summary judgment on its counterclaim is dismissed and the counterclaim of the said defendant is dismissed. [2] In essence, the central issue on appeal is whether the learned chambers judge erred in her interpretation of an exclusion clause in the homeowner's policy of insurance in issue, and in her conclusion that the exclusion clause did not apply. Relevant to that issue is whether the chambers judge erred in finding that an earlier decision of this Court, Canevada Country Communities Inc. v. GAN Canada Insurance Co. (1999), 68 B.C.L.R. (3d) 94, was determinative of the respondent homeowner's claim for coverage. [3] By way of brief background, the respondent, Ms. Lind, owned property in Duncan, British Columbia which was insured by Canadian pursuant to a homeowners' "all risk" policy. The Duncan premises were occupied by Ms. Lind's daughter. Just prior to Christmas, 1995 the daughter travelled to Japan, leaving the premises unoccupied. Thereafter, on or about February 15, 1996, it was discovered that the premises had been damaged by water which came from burst pipes inside the house. The chambers judge found that the pipes had burst as a result of water freezing in the plumbing system. This finding was supported by the evidence. [4] During the daughter's absence, no arrangements had been made to have a person enter the premises daily to ensure that the heating was being maintained and no attempt had been made to shut off the water supply or drain the pipes. [5] Subsequent to the loss being discovered, Canadian authorized emergency repairs to the premises in the amount of $4,615.12. Thereafter, Canadian concluded that the exclusion clause applied and denied further coverage. They also sought to recover the amount which they had already paid. [6] The relevant terms of the insurance policy are as follows: INSURED PERILS You are insured against all risks of direct physical loss or damage subject to the exclusions and conditions in this policy. LOSS OR DAMAGE NOT INSURED We do not insure loss or damage ... caused by freezing of a plumbing, heating, sprinkler or air-conditioning system or domestic appliance unless it happens within a unit heated during the usual heating season and you have not been away from your premises for more than four consecutive days. However, if you had arranged for a competent person to enter your dwelling daily to ensure that heating was being maintained or if you had shut off the water supply and had drained all the pipes and appliances, you would still be insured... [Emphasis added] [7] In my view, it is apparent from a straightforward reading of these provisions that the physical damage which resulted from water escaping from the burst water pipes was damage caused by freezing of a plumbing system within the meaning of the exclusion clause, and that it was excluded under the exclusion clause on the facts of this case. This is so because the damage occurred when the owner (in this case, the occupier) had been away from the premises for more than 4 consecutive days, she had not arranged for a competent person to enter the premises daily to ensure that heating was maintained, and she had not shut off the water supply and drained the pipes. [8] The chambers judge, however, found that the exclusion clause in issue in this case was similar, in effect, to the exclusion clause in Canevada, supra, where the majority found that the exclusion clause did not apply and granted judgment in favour of the policy holder. [9] I do not find it necessary to discuss the Canevada case in any detail. In that case, the wording of the exclusion clause was significantly different than the wording here. Further, the decision in that case turned on the combined effect of the exclusion clause and another provision in the policy which is not found in the policy in issue here. It does not appear that the chambers judge recognized the significance of the combined effect of the two clauses in Canevada in concluding that the analysis in that case was applicable to this policy. [10] In the result, I would allow the appeal, set aside the order of the chambers judge, and dismiss Ms. Lind's action. [11] Counsel for Canadian has also asked that this Court grant judgment in favour of Canadian on its counterclaim. Counsel notes that the amount involved is not large, and he suggests that this Court is in as good a position to grant judgment as the chambers judge. [12] I am not disposed to grant judgment on the counterclaim on which we do not have the benefit of any findings by the chambers judge. There is a live issue concerning whether it would be appropriate to grant judgment on a summary basis given certain conflicts in the evidence, and there is a further question of whether additional pleadings may be required to dispose of all of the issues between the parties. In these circumstances, I am satisfied that it is appropriate to remit the matter of the counterclaim to the Supreme Court for disposition. [13] In summary, I would allow the appeal, set aside the order of the chambers judge, dismiss the plaintiff's action, and remit the matter of the counterclaim to the Supreme Court. [submissions] [14] There was a mixed degree of success with respect to the issues on appeal. We are of the view that two-thirds of the costs of the appeal should be granted to appellant. It sounds as if counsel have agreed that the monies paid out subsequent to the chambers judgment should be repaid. I will leave counsel to draft the appropriate order in that regard. [15] HALL, J.A.: I agree. [16] SAUNDERS, J.A.: I agree. "The Honourable Madam Justice Prowse" April 24, 2001 The date on the top right hand corner was corrected to read 20010315. May 11, 2001 J.A. Fishman added as counsel for the appellant.