Fidelity and Casualty Co. of New York v. General Structures Inc.

Fidelity and Casualty Co. of New York v. General Structures Inc.

Booth made material misrepresentations in the insurance proposal (nonexistent partnership with Breault, misstatement about engagement in construction and employees, inaccurate financial figures); the insurer and broker did not know the true situation and did not waive the misrepresentations; the misrepresentations were material and would have influenced underwriting, therefore the policy is null and void and the trial judgment in favour of the insurer is restored.

Citation
[1977] 2 SCR 1098
Parties
Appellant (garnishee): Fidelity and Casualty Co. of New York; Respondent (seizing Plaintiff): General Structures Inc.; Mis En Cause (defendant): William Harold Booth
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
5 October 1976
Procedural Posture
Civil Appeal Insurance (professional Liability) / Supreme Court of Canada on Appeal From the Court of Appeal for Quebec
Outcome
Appeal allowed; judgment at trial restored; policy declared null and void; garnishment quashed.
Legal Topics
Professional Liability, Misrepresentation in Insurance Proposals, Duty of Disclosure/materiality, Seizure by Garnishment, Warranty in Insurance Contracts, Civil Code Arts. 2487 2490
Source Language
English
Insurance Law Contract Law Civil Procedure Professional Liability Misrepresentation in Insurance Proposals Duty of Disclosure/materiality Seizure by Garnishment Warranty in Insurance Contracts +1 more

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Parties

Fidelity and Casualty Co. of New York

Appellant (garnishee)

General Structures Inc.

Respondent (seizing Plaintiff)

William Harold Booth

Mis En Cause (defendant)

Procedural Posture

Civil Appeal Insurance (professional Liability) / Supreme Court of Canada on Appeal From the Court of Appeal for Quebec

Legal Issues

  1. 1 Whether answers in the insurance proposal constituted misrepresentations
  2. 2 Whether the insurer knew or was aware of the true situation such that it waived the misrepresentations
  3. 3 Whether the misrepresentations were material and voided the policy under Civil Code arts. 2487-2490

Ratio Decidendi

Booth made material misrepresentations in the insurance proposal (nonexistent partnership with Breault, misstatement about engagement in construction and employees, inaccurate financial figures); the insurer and broker did not know the true situation and did not waive the misrepresentations; the misrepresentations were material and would have influenced underwriting, therefore the policy is null and void and the trial judgment in favour of the insurer is restored.

Court Disposition

Appeal allowed; judgment at trial restored; policy declared null and void; garnishment quashed.

Orders

  • Negative statement of garnishee maintained
  • Insurance policy EP-5718 declared null and void