London and Midland Gen. Ins. v. Bonser

London and Midland Gen. Ins. v. Bonser

Because the insurers consented to loss being payable to the mortgagee, s.110 of The Insurance Act and the mortgage clause required the insurers to give the mortgagee the statutory notice before cancelling; the mortgagor’s agent’s notice could not terminate coverage as to the mortgagee without that notice, so the cancellation was ineffective to prejudice the mortgagee.

Citation
[1973] SCR 10
Parties
Defendants/appellants: London and Midland General Insurance Company; Zurich Insurance Company; Pilot Insurance Company; Home Insurance Company; Great Eastern Insurance Company; Dominion Insurance Corporation; Plaintiff/respondent: Olive Tressa Bonser, Executrix of the Estate of Robert Alexander Bonser, Deceased
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
1 May 1972
Procedural Posture
Appeal to Supreme Court of Canada From Court of Appeal for Ontario (insurance/mortgage Dispute) / On Appeal; Judgment Rendered by Supreme Court of Canada Affirming Lower Courts
Outcome
Appeal dismissed with costs.
Legal Topics
Fire Insurance, Mortgage Clause, Policy Cancellation, Statutory Notice, Subrogation
Source Language
English
Insurance Law Mortgage Law Contract Law Fire Insurance Mortgage Clause Policy Cancellation Statutory Notice Subrogation

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Parties

London and Midland General Insurance Company; Zurich Insurance Company; Pilot Insurance Company; Home Insurance Company; Great Eastern Insurance Company; Dominion Insurance Corporation

Defendants/appellants

Olive Tressa Bonser, Executrix of the Estate of Robert Alexander Bonser, Deceased

Plaintiff/respondent

Procedural Posture

Appeal to Supreme Court of Canada From Court of Appeal for Ontario (insurance/mortgage Dispute) / On Appeal; Judgment Rendered by Supreme Court of Canada Affirming Lower Courts

Legal Issues

  1. 1 Whether an insurer may cancel a policy on notice from the mortgagor’s premium-financing agent without giving notice to the mortgagee
  2. 2 Whether the mortgage clause which protects the mortgagee from acts or neglect of the mortgagor prevents termination of the mortgagee’s protection absent statutory notice
  3. 3 Application and effect of s.110 of The Insurance Act and statutory condition 5 on cancellation rights

Ratio Decidendi

Because the insurers consented to loss being payable to the mortgagee, s.110 of The Insurance Act and the mortgage clause required the insurers to give the mortgagee the statutory notice before cancelling; the mortgagor’s agent’s notice could not terminate coverage as to the mortgagee without that notice, so the cancellation was ineffective to prejudice the mortgagee.

Court Disposition

Appeal dismissed with costs.

Orders

  • Appeal dismissed with costs