Preferred Accident Ins. Co. of New York v. Vandepitte

Preferred Accident Ins. Co. of New York v. Vandepitte

Section 24 permits a direct action against an insurer only where the judgment debtor is insured or otherwise has an enforceable right to indemnity under the policy; the daughter was not a party to the policy and provided no consideration, so she had no enforceable right of indemnity and s.24 did not authorize recovery against the insurer; moreover the insurer was not estopped by defending the daughter's action to deny such liability.

Citation
[1932] SCR 22
Parties
Appellant/defendant: Preferred Accident Insurance Company of New York; Respondent/plaintiff: Alice Marie Vandepitte; Defendant/named Insured: R. E. Berry
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
6 October 1931
Procedural Posture
Civil Appeal (insurance Liability) / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia
Outcome
Appeal allowed; action dismissed with costs.
Legal Topics
Insurer Liability Under Statute, Statutory Execution/garnishee Remedy, Third‑party Beneficiary/privity, Estoppel by Conduct, Policy Interpretation
Source Language
English
Insurance Tort Civil Procedure Equity/trusts Insurer Liability Under Statute Statutory Execution/garnishee Remedy Third‑party Beneficiary/privity Estoppel by Conduct +1 more

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Parties

Preferred Accident Insurance Company of New York

Appellant/defendant

Alice Marie Vandepitte

Respondent/plaintiff

R. E. Berry

Defendant/named Insured

Procedural Posture

Civil Appeal (insurance Liability) / Appeal to the Supreme Court of Canada From the Court of Appeal for British Columbia

Legal Issues

  1. 1 Whether a person who is not a party to an insurance policy (the insured's daughter) is an "insured" within the meaning of s.24 of the B.C. Insurance Act so as to permit a direct action against the insurer after an unsatisfied judgment
  2. 2 Whether the insurer is estopped from denying liability under the policy by defending the action against the judgment debtor
  3. 3 Whether the policy language creates a trust or agency obliging the named insured to enforce the policy for the benefit of permissive drivers or passengers

Ratio Decidendi

Section 24 permits a direct action against an insurer only where the judgment debtor is insured or otherwise has an enforceable right to indemnity under the policy; the daughter was not a party to the policy and provided no consideration, so she had no enforceable right of indemnity and s.24 did not authorize recovery against the insurer; moreover the insurer was not estopped by defending the daughter's action to deny such liability.

Court Disposition

Appeal allowed; action dismissed with costs.

Orders

  • Appeal allowed
  • Action dismissed with costs throughout