Hallé v. The Canadian Indemnity Co.

Hallé v. The Canadian Indemnity Co.

Under Quebec civil law the omnibus clause constituted a valid stipulation for the benefit of ascertainable third-party drivers under article 1029 C.C.; such third parties have an insurable interest under articles 2468, 2472 and 2474 C.C.; therefore the insurer was obliged to defend and indemnify the appellant as a permitted driver under the policy and the action in warranty was properly brought.

Citation
[1937] SCR 368
Parties
Appellant (plaintiff in Warranty): Joseph Hallé; Respondent (defendant in Warranty): The Canadian Indemnity Company; Mis En Cause: Rolland Hallé
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
1 June 1937
Procedural Posture
Civil Appeal (insurance Liability) / Appeal to Supreme Court of Canada From Court of King’s Bench, Quebec; Judgment on Appeal
Outcome
Appeal allowed.
Legal Topics
Omnibus Clause, Stipulation for Third Parties, Insurable Interest, Action in Warranty, Automobile Liability
Source Language
English
Insurance Civil Law Tort Contract Omnibus Clause Stipulation for Third Parties Insurable Interest Action in Warranty +1 more

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Parties

Joseph Hallé

Appellant (plaintiff in Warranty)

The Canadian Indemnity Company

Respondent (defendant in Warranty)

Rolland Hallé

Mis En Cause

Procedural Posture

Civil Appeal (insurance Liability) / Appeal to Supreme Court of Canada From Court of King’s Bench, Quebec; Judgment on Appeal

Legal Issues

  1. 1 Whether an omnibus clause creates an enforceable right in an unnamed third-party driver under Quebec civil law
  2. 2 Whether a stipulation for the benefit of third parties in an insurance policy is valid under article 1029 C.C.
  3. 3 Whether the policyholder must have an insurable interest in the third party’s liability for the stipulation to be valid

Ratio Decidendi

Under Quebec civil law the omnibus clause constituted a valid stipulation for the benefit of ascertainable third-party drivers under article 1029 C.C.; such third parties have an insurable interest under articles 2468, 2472 and 2474 C.C.; therefore the insurer was obliged to defend and indemnify the appellant as a permitted driver under the policy and the action in warranty was properly brought.

Court Disposition

Appeal allowed.

Orders

  • Appeal allowed with costs
  • Action in warranty and incidental demand maintained with costs throughout