Agnew-Surpass v. Cummer-Yonge

Agnew-Surpass v. Cummer-Yonge

The lease must be construed by its terms: where the lessor covenants to insure the building 'against all risk of loss or damage caused by or resulting from fire' and the lessee's repairing obligations except damage caused by perils against which the lessor is obligated to insure, reference to the insurance perils...

Source-derived case information.

Citation
[1976] 2 SCR 221
Parties
Tenant Appellant: Agnew-Surpass Shoe Stores Limited; Landlord Respondent: Cummer-Yonge Investments Ltd.
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
21 April 1975
Procedural Posture
Appeal / Supreme Court of Canada on Appeal From Court of Appeal for Ontario
Outcome
Appeal allowed in part
Legal Topics
Fire Insurance, Exculpatory Clause, Subrogation, Loss of Rent, Tenant Negligence, Lease Interpretation, Statutory Interpretation
Source Language
english
Landlord and Tenant Insurance Contract/commercial Law Property Law Fire Insurance Exculpatory Clause Subrogation Loss of Rent +3 more

Source-derived case record

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Parties

Agnew-Surpass Shoe Stores Limited

Tenant Appellant

Cummer-Yonge Investments Ltd.

Landlord Respondent

Procedural Posture

Appeal / Supreme Court of Canada on Appeal From Court of Appeal for Ontario

Legal Issues

  1. 1 Whether the lease obliged the lessor to procure fire insurance that relieved the tenant from liability for fire damage caused by the tenant's negligence
  2. 2 Whether an exculpatory provision or reference to the lessor's insurance in the lease must expressly mention negligence to absolve a tenant
  3. 3 Whether loss of rental income is encompassed by the lease exemption and by the lessor's insurance covenant

Ratio Decidendi

The lease must be construed by its terms: where the lessor covenants to insure the building 'against all risk of loss or damage caused by or resulting from fire' and the lessee's repairing obligations except damage caused by perils against which the lessor is obligated to insure, reference to the insurance perils imports coverage of negligent fires; accordingly the tenant is not liable for property damage recovered under such an insurance-based exculpatory exception. However, the specific exculpatory wording referred to 'damage to the building' and did not extend to loss of rental income, so the landlord could recover loss of rent arising from the fire to the extent claimed.

Court Disposition

Appeal allowed in part

Orders

  • Tenant not liable for damage to building where lease exoneration referenced lessor's insurance covering fires however caused
  • Tenant liable to landlord for loss of rental income in the amount claimed