The insured appellants left their property vacant for a period before a tenant moved in.
The property was later destroyed by fire.
The respondent insurer denied the claim on the basis that the earlier vacancy was a material change to the risk under Statutory Condition 4 of the Insurance Act, which the insured failed to report.
The trial judge granted relief under s. 171 of the Act, finding the condition unjust or unreasonable in these circumstances since the vacancy was rectified before the fire.
The Court of Appeal reversed, holding s. 171 did not apply to statutory conditions.
The Supreme Court of Canada allowed the appeal, concluding that s. 171 applies to statutory conditions that are unjust or unreasonable in their application, and restored the trial judge's decision.
