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

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

The Court held Jeando Inc. had an insurable interest by virtue of its contractual obligation to insure the leased premises; statutory condition 10(a) requires only the existence of an insurable interest (not an explicit statement of the nature of that interest on the policy) and the term 'owned'/'possédée' is to be interpreted broadly to include tenant possession for insurance purposes; absent insurer prejudice or binding agency, omission to specify the nature of the interest did not void the policies, so the insurers were liable for the $50,000 indemnity.

Citation
[1977] 2 SCR 1036
Parties
Appellant/defendant: Commerce & Industry Insurance Co. et al.; Respondent/plaintiff: West End Investment Company
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
29 June 1976
Procedural Posture
Civil Appeal (insurance) / Appeal to Supreme Court of Canada From Court of Appeal for Quebec
Outcome
Appeal dismissed
Legal Topics
Insurable Interest, Statutory Condition 10(a), Interpretation of Civil Code Art.2571, Agency and Broker Knowledge, Policy Form Requirements
Source Language
English
Insurance Property Law Contract Law Insurable Interest Statutory Condition 10(a) Interpretation of Civil Code Art.2571 Agency and Broker Knowledge Policy Form Requirements

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Parties

Commerce & Industry Insurance Co. et al.

Appellant/defendant

West End Investment Company

Respondent/plaintiff

Procedural Posture

Civil Appeal (insurance) / Appeal to Supreme Court of Canada From Court of Appeal for Quebec

Legal Issues

  1. 1 Whether a lessee who contracted to insure the leased building has an insurable interest
  2. 2 Whether failure to specify the nature of the insured’s interest in the policy voids the contract under Civil Code art.2571 and statutory condition 10(a) of the Insurance Act
  3. 3 What is the meaning of 'owned'/'possédée' in statutory condition 10(a)

Ratio Decidendi

The Court held Jeando Inc. had an insurable interest by virtue of its contractual obligation to insure the leased premises; statutory condition 10(a) requires only the existence of an insurable interest (not an explicit statement of the nature of that interest on the policy) and the term 'owned'/'possédée' is to be interpreted broadly to include tenant possession for insurance purposes; absent insurer prejudice or binding agency, omission to specify the nature of the interest did not void the policies, so the insurers were liable for the $50,000 indemnity.

Court Disposition

Appeal dismissed

Orders

  • Appeal dismissed with costs
  • Judgment of the Court of Appeal for Quebec affirmed