Court File and Parties

CITATION: Tripemco Burlington Insurance Group Limited v. Oren Nirenberg & Associates Insurance Brokers Inc., 2011 ONCA 607

DATE: 20110922

DOCKET: C52888

COURT OF APPEAL FOR ONTARIO

Doherty, Weiler and Laskin JJ.A.

BETWEEN

Tripemco Burlington Insurance Group Limited

Plaintiff (Respondent on Appeal)

and

Oren Nirenberg & Associates Insurance Brokers Inc., Insurance Land Inc. and Oren Nirenberg

Defendants (Appellants on Appeal)

Counsel:

Micheal Simaan, for the defendants (appellants)

Ray Di Gregorio, for the plaintiff (respondent)

Heard and released orally: September 20, 2011

On appeal from the judgment of Justice Ramsay of the Superior Court of Justice dated October 1, 2010.

ENDORSEMENT

[1] This is an appeal from a judgment wherein the appellant, Oren Nirenberg, was ordered to personally pay to the respondent 50 percent of certain commissions received by his company, Oren Nirenberg & Associates Insurance Brokers Inc. (“ON & A”). ON & A was also ordered to pay those funds to the respondent. There is no appeal from that part of the judgment.

[2] Mr. Nirenberg and Mr. Paul Vacarello, the principal of the respondent, entered into an agreement whereby their companies would participate in a joint venture by which they would market various insurance products and share commissions earned on a 50/50 basis. Under this agreement, they arranged for Zurich Insurance to provide various group insurance coverages to employees and alumnae of Seneca College. Mr. Nirenberg had the connections at Seneca College and Mr. Vacarello had previously done business with Zurich.

[3] Zurich agreed to pay to the respondent a percentage of the premiums it earned through the sale of the group policies to Seneca employees and alumnae. The respondent was in turn obligated to pay 50 percent of those commissions to ON & A under the terms of their joint agreement. The respondent was responsible for administrative matters arising out of the Zurich agreement and was appointed by Seneca as its agent for the purpose of the Zurich business. ON & A apparently dealt with day-to-day sales issues.

[4] Zurich and the respondent did not enter into a formal written agreement as there was a dispute over a term with respect to the ownership of the Seneca business. The written agreement tendered by Zurich was not accepted by the respondent because, in the respondent’s view, one term of that agreement would have given ownership of the business to Zurich and allowed Seneca to unilaterally terminate the respondent as its agent. Although no written agreement was entered into, Zurich did sell the programs to the Seneca employees and alumnae and did forward commission payments under the terms of the agreement to the respondent for some two years (1991-2001). The respondent in turn met its obligations by forwarding 50 percent of those commissions to ON & A.

[5] In March 2001 at Mr. Nirenberg’s instigation, the Seneca Alumnae Association advised Zurich that it had appointed ON & A as its agent to replace the respondent. In April 2001, Mr. Nirenberg wrote to Zurich directing them to “forward all compensation and related items” directly to ON & A. Zurich complied and began to forward commission payments to ON & A rather than the respondent. ON & A did not share those commissions with the respondent as it was obliged to do under the joint venture. The liability of ON & A for 50 percent of those commissions is no longer in issue. This appeal involves only Mr. Nirenberg’s personal liability.

[6] The trial judge found Mr. Nirenberg personally liable for inducing Zurich to breach its contract with the respondent by causing Zurich to stop forwarding commissions to the respondent and to begin forwarding them to ON & A in April 2001. The trial judge accepted that while Zurich and the respondent had not entered into a formal written agreement, they had in fact agreed that Zurich would pay the commissions to the respondent on the terms and conditions in the written agreement proposed by Zurich save the paragraph dealing with ownership of the business. The trial judge made the following finding, at para. 14:

... I find that Zurich and Tripemco by their conduct entered into an unwritten contract essentially in the terms of the draft, on the basis of a 3% commission, and without agreeing on who owned the business written. Mr. Nirenberg was aware of this contract. He discussed it regularly with Mr. Vacarello. Mr. Nirenberg testified that he disagreed with Mr. Vacarello’s decision to take a hard line on the ownership question and he told Mr. Vacarello to. So he was aware of the contract and its terms. [Emphasis added.]

[7] The trial judge ultimately concluded, at para. 32:

Mr. Nirenberg asked Zurich to send the commissions to ON & A, instead of to the plaintiff. Under the contract, the commissions were supposed to be sent to the plaintiff. Mr. Nirenberg knew that if Zurich complied with his request, it would be breaching its contract with Tripemco. Mr. Nirenberg’s act constituted more than a breach of contract by ON & A. It was an intentional act that caused Zurich to breach its contract with the plaintiff. The breach occasioned damage to the plaintiff, because the plaintiff did not receive its share of the commissions from June 30, 2001 to October 1, 2003, when Zurich ended the programme. I therefore find Mr. Nirenberg personally liable in tort.

[8] There is no dispute as to the law governing the tort of inducing a breach of contract. Nor is there an issue as to the existence of an agreement between Zurich and the respondent. The appeal comes down to this – did the trial judge fall into error in concluding that the contract did not include a provision whereby Zurich could unilaterally make payments to someone other than the respondent if so directed by Seneca? Put another way, did the contract oblige Zurich to continue to make the payments to the respondent as long as it received premiums from Seneca and as long as its agreement with Seneca remained in force?

[9] In our view, the trial judge’s findings are supported by the evidence. On the agreement as he found it, Zurich could not unilaterally stop paying the commissions to the respondent and pay them to another broker simply upon notification that Seneca had changed its broker. The contract as found by the trial judge provided the means by which Zurich could terminate its agreement with the respondent if it chose to do so. It did not terminate the agreement. In our view, Zurich’s failure to continue to pay the commission to the respondent constituted a breach of its contract with the respondent. There is no question but that Mr. Nirenberg induced that breach or that he was aware of Zurich’s obligation to make the payments to the respondent.

[10] In our view, the appeal must be dismissed. The respondent is entitled to its costs. We fix those costs at $3,800, plus disbursements and all applicable taxes.

“Doherty J.A.”

“K.M. Weiler J.A.”

“J.I. Laskin J.A.”