DATE: 20030115

DOCKET: C35486

COURT OF APPEAL FOR ONTARIO

RE: ZURICH CANADA (Plaintiff/Respondent) –and–

HENRY PAUL FORTIN, THOMAS CAMPBELL, SUSAN STEWART by her Litigation Guardian, Jennifer Stewart, JENNIFER STEWART, HYMAN GROSS and JENNIE GROSS (Defendants/Appellants/Plaintiffs by Counterclaim)

BEFORE: LABROSSE, CHARRON and GILLESE JJ.A.

COUNSEL: Edward H. Masters, for the defendants/appellants/plaintiffs by counterclaim Susan Stewart by her litigation guardian, Jennifer Stewart, Jennifer Stewart, Hyman Gross and Jennie Gross

Arthur Robert Camporese, for the defendant/appellant Thomas Campbell

J. Stephen Cavanagh, for the plaintiff/respondent

HEARD: January 14, 2003

RELEASED ORALLY: January 14, 2003

On appeal from the judgment of Justice Roydon Kealey of the Superior Court of Justice, sitting without a jury, dated November 15, 2000.

E N D O R S E M E N T

[1] The appellants appeal the decision of the motions judge to the effect that, as of December 10, 1993, Henry Paul Fortin no longer had insurance with Zurich Canada against liability arising from the ownership, use, or operation of a 1970 GMC truck.

[2] On August 18, 1993, Fortin, through his insurance broker Ernest Jacobs, insured two vehicles, a Ford Torino and a 1970 GMC truck with Zurich. As a result of using the GMC truck in a manner that may have resulted in the cancellation of the policy, Fortin, on the advice of Jacobs, made an informed decision to delete the GMC truck from his insurance policy. On December 9, 1993, in Jacobs’ office, Fortin and Jacobs signed an Acknowledgement of Policy Change Form which provided that insurance coverage on the GMC truck would be deleted, effective at 12:01 a.m. on December 10, 1993.

[3] Jacobs emphasized to Fortin that after December 10, 1993, Fortin would no longer have insurance on his GMC truck. He also told Fortin that, after Zurich had processed the paperwork, he would be entitled to a premium adjustment, calculated as of the effective date shown on the Acknowledgement of Policy Change Form.

[4] On December 9, 1993, Jacobs informed Zurich by fax that Fortin had deleted the GMC truck from his policy. The notice of deletion of the GMC truck was date-stamped in Zurich’s offices on December 15, 1993.

[5] On January 13, 1994, Zurich credited Fortin with an overpayment of premium on his policy effective December 10, 1993, in relation to the deletion from coverage of the GMC truck. On February 16, 1994, Zurich forwarded an Amended Insurance Certificate to Fortin, showing the deletion of the GMC truck.

[6] In the meantime, on December 27, 1993, Fortin was involved in an accident with the GMC truck resulting in injuries to the appellant, Susan Stewart, which accident gave rise to this action.

[7] The appellants do not dispute that Fortin and Jacobs intended to delete coverage on the GMC truck, effective December 10, 1993. Nor do they dispute that Fortin and Jacobs both believed that coverage had been deleted. The argument advanced by the appellants, who are claimants and not insured under the policy, is that the cancellation only became effective when it was processed administratively by Zurich and Fortin’s unearned premium was credited to him in January 1994. They take this position on the basis that Jacobs did not have the authority to accept Fortin’s request and that further, when Zurich purported to accept it, it was too late because a loss had already occurred.

[8] On the basis of the evidence of John Rafuse, regional manager of Zurich, the motions judge found that Jacobs was authorized as Zurich’s agent to accept an Acknowledgement of Policy Change Form on Zurich’s behalf and to commit Zurich to such a change where an insured wished to delete a vehicle from coverage. He also found that no further action was required by Zurich in order to give effect to Fortin’s cancellation of insurance on the GMC truck. Zurich would have no choice but to implement the concluded agreement.

[9] The motions judge noted that Jacobs was also of the view that he was able to accept instructions to delete coverage on behalf of Zurich.

[10] Rafuse was not cross-examined on his affidavit. Although Fortin was a party to the action, there was no evidence led by him and the appellants chose not to examine him for discovery. Fortin does not dispute Zurich’s position on this appeal.

[11] There was no contrary evidence and it is on the basis of these facts that the motions judge concluded that the evidence on this point was “unchallenged”.

[12] The findings of the motions judge are amply supported by the evidence and there is no basis to interfere. After the cancellation had been effectively accepted by Jacobs on Zurich’s behalf, the remaining process was merely administrative. The fact that the premium had not yet been returned did not affect the validity of the cancellation.

[13] The appeal is dismissed with costs fixed at $7,850.00 plus G.S.T.

Signed: “J.-M. Labrosse J.A.”

“Louise Charron J.A.”

“E.E. Gillese J.A.”