COURT OF APPEAL FOR ONTARIO

CITATION: ResQ Auto Glass Inc. v. Co-operators General Insurance Company, 2016 ONCA 30

DATE: 20160114

DOCKET: C60144

Simmons, LaForme and Huscroft JJ.A.

BETWEEN

ResQ Auto Glass Inc.

Plaintiff (Appellant)

and

Co-operators General Insurance Company

Defendant (Respondent)

H. Richard Bennett and Joseph Figliomeni, for the appellant

Derek V. Abreu, for the respondent

Heard: December 7, 2015

On appeal from the order of Justice W. Low of the Superior Court of Justice, dated February 11, 2015.

By the Court:

[1] ResQ Auto Glass Inc. appeals from a summary judgment dismissing its action against Co-operators General Insurance Company for breach of contract and intentional interference with economic interests and contractual relations.

[2] In its statement of claim, ResQ claimed $208,359.57 on account of windshield repairs effected between February 2012 and July 2014 to 1,844 automobiles insured by Co-operators.

[3] ResQ asserted that it had obtained assignments from the automobile owners of their right to receive direct payments for the repairs from their insurer by means of an assignment clause, written in fine print, contained at the bottom of a repair estimate signed by each insured. Although the repair estimate and assignment indicated the insured would pay $0 for the repair, ResQ claimed that Co-operators had agreed in a letter dated January 23, 2012 to pay ResQ for windshield repairs at the windshield industry market repair rate. ResQ asserted that rate was $100 per repair and that Co-operators breached its contract with ResQ to pay the market rate by paying only $50 per repair.

[4] In addition, ResQ claimed that Co-operators was liable for the tort of intentional interference with economic interests. ResQ also claimed punitive damages.

[5] The motion judge dismissed ResQ’s motion for summary judgment and granted Co-operators motion for dismissal of ResQ’s action.

[6] The motion judge found that the windshield repairs at issue were completed under individual contracts between Co-operators and ResQ and that in each case, prior to the repair being undertaken, Co-operators offered to pay for the repair by issuing a repair authorization for $50. Further, she held that ResQ accepted the offer by completing the repair. In response to an argument that each insured had assigned their insurance contract or their right to receive the insurance proceeds, the motion judge held that the insurance contracts were not assignable. She found that, in any event, the insureds had nothing to assign because Co-operators had exercised its right under the insurance contracts to effect the repairs.

[7] Concerning the January 23, 2012 letter, the motion judge held that the statement in the letter that Co-operators would pay “a $40 total for windshield repairs up to and including 3 chips” was definitive “as to the Insurer's intentions.” She said the later description of the rate as the “windshield repair industry rate” did not derogate from the specificity of the stated amount or the terms of the subsequent authorizations. She added “parenthetically” that the appellant had not demonstrated that the market rate for windshield repairs was $100.

[8] ResQ raises several issues on appeal.

[9] First, ResQ argues that the motion judge erred in failing to construe the transaction between ResQ and the insured as a valid assignment at law. We reject this argument.

[10] The motion judge’s reasons reflect the following key findings:

• the windshield repairs at issue were initiated through independent contractors who found cars with windshield chips, identified their owners, ascertained the owners’ insurers and placed calls to the insurers to facilitate authorization by the insurers to ResQ to do the repair;

• on being contacted by ResQ, a Co-operators representative would ask to speak to the car owner and would verify that the owner was one of its insureds for the period of time when the chip or chips are said to have occurred;

• Co-operators then issued a document to ResQ authorizing it to effect the repair at a stipulated price;

• the practice was that in each case, ResQ obtained the authorization from Co-operators and subsequently obtained the owner’s signature on a form generated by ResQ titled “Work Order Estimate”. The Work Order Estimate showed the total cost to the car owner as $0;

• there was no evidence that ResQ disclosed to the car owner the amount that it would invoice Co-operators for the repair;

• the Work Order Estimate contained a section at the bottom printed in very small print that included the assignment language on which ResQ relies. The print on the sample document was so small the motion judge found it to be illegible and had to have it reproduced;

• the contract between the car owner and ResQ allowed ResQ to repair the car owner’s windshield and bill Co-operators;

• there was a separate contract between ResQ and Co-operators for each automobile that was the subject of a windshield repair. Co-operators made an offer by issuing an authorization. ResQ accepted the offer by effecting the repair;

• Co-operators’ obligation under its insurance policies was either to indemnify its insured for what the insured paid to repair the damage to the insured’s automobile or to repair the automobile – provided the insured had purchased the coverage and provided that reimbursement was not precluded by the deductible amount. In this case, on being approached by an insured and ResQ, Co-operators contracted directly with ResQ to effect windshield repairs for $50 regardless of whether it had an obligation under the insurance policy to do so. Vis-à-vis the insured, the Insurer was waiving the deductible where there was one;

• in each instance, the car owner was made whole, the windshield was repaired and the car owner expended nothing. Vis-à-vis the insured, there was no breach of the policy; and

• the assignment at the bottom of the Work Order Estimate does not assist ResQ because the insured has no right to be indemnified. Co-operators caused the repair to be made – the insured paid nothing and undertook no contractual obligation to pay anything for the repair. The insured therefore has no cause of action against the Insurer.

[11] At their core, the motion judge’s findings establish that there was a contract for repair at a specified price between Co-operators and ResQ. The purported assignment of the right to receive proceeds of insurance was ineffective because, in the context of these particular transactions, the car owners had paid nothing, had no claim against Co-operators and therefore had nothing to assign.

[12] During oral argument, ResQ asserted that the Co-operators’ repair authorizations arrived after the windshield repairs were completed and therefore did not form part of any contract. Moreover, the motion judge’s focus on the $0 specified in the Work Order Estimates was an irrelevant consideration. The amount to be paid under the assignments would be determined through the customary proof of claim/investigation process.

[13] We cannot accept these arguments. As illustrated above, the motion judge made specific findings that Co-operators made an offer to repair each automobile at a specified price by means of its written authorization and that ResQ accepted each offer by completing the repair. ResQ did not challenge these findings of fact on appeal. Moreover, based on our review, the findings are fully supported by the record.

[14] Second, ResQ argues that the motion judge erred in failing to consider: Co-operators’ duty to assess the cost of damage in each particular case; Co-operators’ deemed admission that the cost of damage was $100; and the doctrines of estoppel by convention and representation. In this regard, ResQ relies in part on numerous transactions prior to the January 23, 2012 letter indicating Co-operators paid $100 to ResQ for windshield repairs essentially identical to the later repairs for which it paid only $50.

[15] We do not accept this submission. Co-operators gave clear notice of its intention not to continue to pay $100 for windshield repairs in the January 23, 2012 letter. ResQ chose to continue to provide repair services to Co-operators’ insureds after receiving the letter and continued to act on repair authorizations received from Co-operators specifying a price of $50. ResQ was not obliged to do so. Moreover, the motion judge held there was an individual contract for each windshield repair at a specified price. We see no basis on which ResQ can now assert that Co-operators was bound by the terms of prior dealings in relation to new contracts or that Co-operators had any additional duties to its insureds.

[16] Third, ResQ argues that the motion judge erred in failing to find the January 23, 2012 letter was an enforceable promise to pay ResQ the market rate for windshield repairs and in failing to draw an adverse inference against Co-operators concerning what the market rate was because of Co-operators refusal to disclose relevant information.

[17] We reject this submission. The motion judge construed the effect of the January 23, 2012 letter as being notice to ResQ that Co-operators would no longer pay the amount it had been paying for windshield repairs and that, in future, it would pay $40 (later increased to $50). The statement about paying market rate for windshield repairs did not derogate from the specificity of this notice confirming what Co-operators was prepared to pay. We see no basis on which to interfere with the motion judge’s interpretation of the effect of the letter.

[18] Fourth, ResQ argues that the motion judge erred in failing to address its claim in tort and in failing to find that Co-operators engaged in unlawful acts with the intention of causing harm to ResQ and that it did in fact cause harm to ResQ.

[19] We do not accept this submission. ResQ failed to demonstrate that Co-operators engaged in any unlawful conduct vis-à-vis its insureds. In relation to each automobile, Co-operators arranged to have the automobile repaired and to pay the cost of the repair directly to the repairer, ResQ. In these circumstances, Co-operators breached no duties to its insureds. In fact, as the motion judge held, Co-operators waived its rights under its contracts with its insureds in an effort to deal efficiently with what were small damage claims. In effect, Co-operators provided its insureds with an indulgence. We fail to see how this can form the basis for a finding of unlawful conduct vis-à-vis Co-operators’ insureds.

[20] ResQ also argued that Co-operators’ conduct amounted to “discrimination” against ResQ because Co-operators failed to pay ResQ what it was paying other service providers for what was essentially the same work. Further, the January 23, 2012 letter was a ruse to disguise Co-operators’ discriminatory conduct. Leaving aside the question whether ResQ proved its allegations, they do not establish a cause of action in any event. On the motion judge’s findings, Co-operators entered into individual contracts with ResQ at a price Co-operators quoted in each case. ResQ was free to accept or reject the price that was offered. ResQ failed to establish any basis for asserting Co-operators’ conduct in this regard was unlawful.

[21] Finally, in the light of our findings as set out above, we see no error in the motion judge’s decision not to address the appellant’s claim for punitive damages.

[22] Based on the foregoing reasons, the appeal is dismissed. Costs of the appeal are to the respondent on a partial indemnity scale, fixed in the amount of $17,500, inclusive of disbursements and applicable taxes.

Released:

“GH” “Janet Simmons J.A.”

“JAN 14 2016” “H.S. LaForme J.A.”

“Grant Huscroft J.A.”