Rozana M. Raducanu v. Primmum Insurance Company et al.

NEWMARKET COURT FILE NO.: CV-18-134327-00

DATE: 20201209

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

Rozana M. Raducanu Plaintiff

– and –

Primmum Insurance Company, and its successors in interest, TD General Insurance Company and/or TD Home and Auto Insurance Company Defendants

COUNSEL:

Michael Lesage, for the Plaintiff

Arie Odinocki and George Nathanael, for the Defendants

HEARD: November 19 and 20, 2020, via Virtual Hearing

DECISION ON SUMMARY JUDGMENT MOTION

SUTHERLAND J.:

Overview

[1] The plaintiff brings a summary judgment motion seeking, inter alia:

(a) A declaration that her contractual home insurance policy, Homeowner Bronze Advantage, bearing policy number 79396487 with the defendants, Primmum Insurance Company/TD General Insurance Company (the Policy), on the residence owned by the plaintiff, 12 Frank Johnston Road, Bolton, Ontario (the Property), was in full force and effect on January 26, 2017.

(b) Damages in the amount of $398,958.94.

(c) In the alternative, a declaration as in paragraph (a) with damages to be assessed.

(d) Costs.

[2] The action involves damages caused by a fire at the Property on January 26, 2017, for which the plaintiff contends the Policy obligates the said defendants to pay.

[3] The defendants, Primmum Insurance Company/TD General Insurance Company (Primmum), were the insurers of the plaintiff for home insurance and automobile insurance for approximately 13 years.

[4] The Policy was terminated effective October 1, 2016, nearly four months prior to the fire. The defendants contend that they are not obligated to provide coverage under the Policy since it was terminated effective October 1, 2016, and that coverage for the fire would be excluded under the terms of the Policy on the basis of the intentional or criminal acts exclusion, even if the Policy had still been in force at the time of the fire.

[5] As indicated in the reasons below, I conclude that there is no genuine issue for trial and dismiss the motion and action of the plaintiff.

Factual Background

[6] The plaintiff is married to Stefan Raducanu (Stefan). They have a daughter.

[7] The plaintiff and her husband first purchased a homeowner’s policy from Primmum in 2005. At that time, the Policy covered another location. Premiums for the Policy had always been paid by a pre-authorized debit from a bank account associated with the plaintiff, through Primmum’s Pre-Authorized Debit Program (PAD). The Property was added to the Policy as an insured location on July 10, 2015. The plaintiff was the sole listed insured on the Policy after July 10, 2015. Primmum confirmed that the plaintiff was the sole insured under the Policy by written Home Insurance Confirmation dated June 8, 2015. The Policy was renewed for another year beginning on May 25, 2016. The monthly Policy premium payments were to be debited from a Toronto-Dominion bank account in the name of Stefan ending in number 0046 (TD Bank account) on the 25th of each month. The sum of the monthly payment was $68.12.

[8] On June 25, 2016, Primmum attempted to debit the TD Bank account and the bank refused to authorize the debit due to there being insufficient funds in the account. Tammy Boyer, a Primmum agent, attempted to call the plaintiff on June 29, 2016 to advise the plaintiff of her missed premium payment. Ms. Boyer first attempted to call the cell phone number in Primmum’s electronic file for the plaintiff: 416-902-0473, but there was no answer and she did not reach a voicemail. Ms. Boyer then called an old phone number in Primmum’s electronic file: 416-771-3482, but reached a voicemail of an unknown person, Sean Anderson. The cell number was a previous number of Stefan.

[9] A letter dated July 2, 2016 was sent by Primmum to the plaintiff by regular mail to the address of the Property, advising her of the missed premium payment and advising her that cancellation procedures could be initiated if she missed another premium payment. This July 2, 2016 letter was not returned to Primmum. Due to the missed payment, Primmum enacted the PAD return process.

[10] The missed payment of June 25, 2016 was paid by withdrawal from a TD Bank account on July 7, 2016.

[11] On July 22, 2016, the plaintiff provided Primmum with her home phone number along with her work and email address, notwithstanding Primmum had the plaintiff’s email address for home and work, as evidenced by emails sent in 2015.

[12] On July 25, 2016, an attempt was made by Primmum to debit the TD Bank account for payment of the monthly premium and an NSF charge ($68.12 and $25.00). The debit was not processed due to there being insufficient funds in the account. Primmum was notified of this missed premium payment on July 27, 2016. It appears that the TD Bank account was overdrawn more than the overdraft protection of $1,000.

[13] On July 26, 2016, the plaintiff contacted Primmum to advise of her Scotiabank account for payment of premium payments, home and vehicle. The plaintiff deposited the necessary sums to pay the pending vehicle insurance scheduled to paid on July 28, 2016. During this call, the plaintiff indicates that she inquired as to whether the home insurance payment was made and was assured that it had been along with a $25 NSF fee. The plaintiff states that she was also advised that payment for the Policy would be paid from her Scotiabank account, beginning August 25, 2016.

[14] Primmum sent a letter dated July 26, 2016 to the plaintiff confirming the change to Scotiabank for payment, and the payments from the account would commence August 25, 2016.

[15] On August 4, 2016, a premium payment was not received for the automobile insurance, and a Primmum agent called the plaintiff that same day at 905-533-1803, the plaintiff’s home number, and left a voicemail message requesting a call back. However, the plaintiff did not return the call. Primmum attempted payment not through the Scotiabank account.

[16] On September 14, 2016, Primmum sent a registered mail letter to the address of the Property indicating notice of the pending termination of the Policy effective October 1, 2016, as a result of the non-payment of premiums. Canada Post confirmed that this registered mail letter reached its Bolton South Post Office on September 16, 2016, and that an attempt was made to deliver the letter to the Property the same day. The registered letter was not subsequently claimed by the plaintiff, and so it was returned to sender on October 5, 2016.

[17] Primmum terminated the Policy effective October 1, 2016. Primmum subsequently sent correspondence to the Property on October 27, November 1 and November 22, 2016 by regular mail, advising the plaintiff that the Policy had been terminated and that there was a balance owing on her account. These letters were not returned to Primmum. The plaintiff indicates that she did not receive these letters.

[18] Primmum did receive payment on the automobile insurance premiums from the Scotiabank account, and the car insurance was in good standing.

[19] In December 2016, Primmum referred the plaintiff’s account to a collection agency, D&A Collections. A D&A Collections employee spoke with the plaintiff on January 24, 2017, and advised her of the termination of the Policy. In the conversation, the plaintiff was shocked that her home insurance was cancelled.

[20] The plaintiff also spoke to a Primmum agent on January 26, 2017, and was again advised of the termination of the Policy. In that conversation, the plaintiff was upset and threatened to cancel her automobile insurance with Primmum. Primmum would not agree to reinstate the Policy even if all payments were made and brought up to date.

[21] The plaintiff did not seek to obtain home insurance with another insurer.

[22] Later the same day, January 26, 2017, the fire occurred.

[23] The day after the fire, the plaintiff’s daughter provided a statement to the Ontario Provincial Police, indicating that on the previous day she saw Stefan waving around a red canister of gasoline by the front door of the Property. She also indicated that she also saw the plaintiff’s husband go inside and close the front door. She then saw that the garage of the Property was on fire. Stefan underwent a mental health screening after the fire, which indicated that he did not have any hallucinations, delusions or abnormal thought processes. After being taken to the hospital, he was also found to have an adjustment disorder with depressed mood, but no other psychological diagnosis was made at that time and he was never found to have been in a dissociated state. The Office of the Fire Marshall found that the fire was intentionally started by Stefan. He was criminally charged with arson and ultimately pled guilty to mischief endangering life.

[24] Stefan was living at the Property at the time of the fire, along with the plaintiff, their daughter and their dog. Stefan was living at the Property for just under two months. The plaintiff has stated that she and Stefan were last romantically involved when they were living together at the residence in September 2016. Stefan then moved to Montreal for work. He stayed there on a lease that was signed by both the plaintiff and him. They continued to share bills of the Property.

[25] As a result of health issues, Stefan moved back to the Property in early December 2016. The plaintiff indicates that she considered Stefan as a house guest at the time of the fire, but he had no set date to move out of the Property. He carried out household tasks and sometimes shared meals with the plaintiff and their daughter.

[26] On February 17, 2017, the plaintiff reported the fire to Primmum and requested that Primmum open a formal claim. During the claims process, the Primmum claims analyst told the plaintiff that the claim was denied. The claims analyst advised the plaintiff on March 20, 2017, that the Policy had been cancelled “ab initio”.

[27] Stefan began exhibiting significant health issues in 2016. His health problems included cervical myelopathy, orthostatic tremors, essential tremors, stiff person syndrome and spinocercebellar ataxia. His health issues resulted in financial troubles with the automobile premium payment and the Policy premium payment being returned NSF in May and June 2016, respectively.

[28] On November 29, 2016, Stefan’s family doctor requested that Stefan be seen for a psychiatric assessment on an urgent basis. The assessment note of the family doctor indicates suicide by Stefan’s grandmother, that he was abused as a child and listed Adderall, Percocet and Zoloft as concurrent problems. Stefan has had problems with depression since at least 2007.

[29] Stefan was assessed. On January 14, 2017, Dr. Koczerginski opined that Stefan was at high risk and recommended that Stefan be “admitted for further assessment to the inpatient mood disorder unit. Consideration can be given to the various psychological and, perhaps pharmacological treatments of his mood.”

[30] Stefan also saw further medical practitioners where it was recommended that he be admitted to medicine for appropriate neurosurgical center for definitive decompressions. Stefan was advised on January 25, 2017 that he would require a decompression instrument fusion on an urgent basis. He was not admitted for such surgery.

[31] Stefan clearly has physical and mental health issues.

The PAD Program

[32] Primmum has a PAD Program that allows clients to pay their premiums by pre-authorized debit from a bank account. The Program indicates that if a payment is not paid, Primmum is to notify the client by telephone based on the contact information given. If a client misses a second payment within a year, the client is removed from the PAD Program and Primmum may take steps to terminate the Policy, the PAD return process.

The Pleadings

[33] The plaintiff, in her Statement of Claim, seeks relief based upon: breach of contract, breach of fiduciary duty, negligence, professional negligence, negligent misrepresentation, negligent infliction of emotional distress, relief from forfeiture, estoppel, waiver, reliance and breach of the duty of good faith and fair dealing.

[34] The defendants deny that it owed a duty of care to the plaintiff, were negligent, and negligently misrepresented to the plaintiff. The defendants plead that they complied with the terms and condition of the Policy.

[35] The Statement of Claim does not particularize the duty of care owed, the standard of care, nor does it particularize the factual foundation for negligent misrepresentation.

Summary Judgment

[36] Pursuant to r. 20.01 of the Rules of Civil Procedure,[^1] the court must grant summary judgment if it is satisfied there is no genuine issue requiring a trial. In response to a summary judgment motion, one is not permitted to solely rely on allegations or denials in their statement of defence, but must provide affidavit material with the specific facts showing that there is a genuine issue requiring a trial.

[37] There will be no genuine issue requiring a trial when a court is able to reach a fair and just determination on the merits. A fair and just determination on the merits is achieved when:

(a) The process allows the judge to make necessary findings of facts;

(b) The process allows the judge to apply the law to the facts; and,

(c) It is a proportionate and more expeditious and less expensive means to achieve a just result.[^2]

[38] On a motion for summary judgment, the court must first determine if there is a genuine issue requiring a trial based on the evidence given on the motion. If there appears to be a genuine issue requiring a trial, the court would then determine if the need for a trial can be avoided using the powers under r. 20.04(2.1) of the Rules of Civil Procedure by weighing the evidence, evaluating the credibility of the deponents, and drawing any reasonable inference from the evidence unless it is in the interest of justice for these powers to be exercised only at a trial. These powers are presumptively available to the judge to give effect to the goals of timeliness, affordability and proportionality in review of the litigation.[^3]

[39] In contrast, the responding party must put their “best foot forward” or risk summary judgment being awarded against them. The responding party bears the evidentiary burden to present affidavit material or other evidence to support the allegations or denials in their pleading. Absent this evidence, an adverse inference can be drawn.[^4]

[40] Summary judgment is not the rule but rather the exception. If the court is not satisfied that it can make a fair and just determination on the merits, the court should not grant summary judgment and allow the proceeding to proceed to trial.[^5]

Is there a genuine issue for trial?

Position of the Parties

[41] The plaintiff argues that there are no genuine issues for trial and the judgment should be rendered in her favour. The plaintiff argues that the court, from the evidence filed, can make a fair and just adjudication. The plaintiff argues that the record indicates, on the balance of probabilities, that the defendants, specifically Primmum, breached the contract of home insurance, the Policy, and that Primmum was negligent in their conduct on the notification to the plaintiff that the Policy had terminated, and in its conduct on the payment of the Policy premiums from the Scotiabank account. The plaintiff contends that Primmum breached the contract by failing to abide by the termination provisions in the Policy, and by not reimbursing the premiums paid. The plaintiff argues that Primmum breached the terms of the Policy and negligently misrepresented to the plaintiff that the July 25, 2016 payment was made. As such, the plaintiff argues that Primmum cannot rely on the termination provisions of the Policy. Further, by claiming the Policy was void “ab initio”, Primmum did not pay to the plaintiff all monthly premiums paid. Primmum’s failure to pay, along with its misrepresentation, prevents it from relying on the termination provisions of the Policy for non-payment of premiums by the plaintiff.

[42] In addition, the conduct of the Primmum was negligent in their management of the Policy and the account of the plaintiff. Primmum, after July 22, 2016, knew the proper phone numbers, email addresses and particulars of the plaintiff’s Scotiabank account. The plaintiff provided all relevant information to Primmum to pay the required premiums, as the automobile policy was paid. Primmum failed to adhere to its own PAD Program internal policy. If not for the negligence of Primmum, the Policy premiums would have been paid and the Property would have effectively been insured to cover the loss sustained by the plaintiff due to the fire. The plaintiff did not make any submissions on the other grounds for relief described in the Statement of Claim, namely, breach of fiduciary duty, negligent infliction of emotional distress, relief from forfeiture, estoppel, waiver, reliance and breach of the duty of good faith and fair dealing.

[43] The defendants argue that on the evidence before the court, a fair and just adjudication cannot be made. There are numerous genuine issues that require a trial. The defendants argue that issues that cannot be adjudicated on this motion include:

(a) whether Primmum terminated the Policy in accordance with Statutory Condition 5;

(b) considering the various information possessed by the plaintiff, whether it was reasonable for the plaintiff to have believed that the representations made by Primmum in a July 26, 2016 phone call and July 26, 2016 letter, meant that Primmum could not have terminated the Policy at any point in advance of the fire;

(c) whether the plaintiff could not have reasonably been aware that there may have been an issue with the Policy until her phone call with the collections agency on January 24, 2016;

(d) whether it was reasonable for the plaintiff to not take steps to secure insurance coverage for the Property after the phone call with the collections agency on January 24, 2016, or after any other earlier date upon which the plaintiff should have been reasonably aware that there was an issue with the Policy;

(e) whether Primmum owed a duty of care to the plaintiff in tort beyond the terms and obligations outlined in the Policy;

(f) whether Primmum’s handling of the plaintiff’s account and termination of the Policy fell below the applicable standard of care of a reasonable residential insurance company;

(g) whether Primmum’s actions caused the plaintiff’s damages, and whether there were no intervening events or contributory negligence of the plaintiff that broke the chain of causation;

(h) whether the plaintiff’s damages did not result from any intentional or criminal act or failure to act by Stefan;

(i) whether Stefan was not living in the same household as the plaintiff just before the fire; and

(j) whether the plaintiff has accurately and precisely calculated the extent of her losses and the portion of these losses that are covered under the terms of the Policy.

[44] The defendants concede that they did not bring a motion seeking summary judgment or partial summary judgment on any of the issues in this action. But did request, at the hearing, that the motion and action should be dismissed. The defendants asserted, at the hearing, that Primmum followed the termination provisions of the Policy and along with the exclusion of intentional or criminal conduct, the plaintiff has no claim. The evidence is clear. The plaintiff cannot succeed on her claim against the defendants based on the terms of the Policy. If, however, the court does not accept that Primmum conducted itself properly in the termination of the Policy due to non-payment of premiums, then the action must proceed to trial.

[45] The parties agreed that notwithstanding the defendants’ failure to request relief, the court may dismiss the action if the court concludes that it has ample relevant evidence before it and that the court can make a fair and just determination of the proceeding.[^6]

Analysis

Contract

[46] To begin, pertinent terms of the Policy concerning termination and exclusion for intentional or criminal acts reads:

5. TERMINATION

6. This contract may be terminated:

a. by the Insurer giving to the Insured 15 days’ notice of termination by registered mail or five days’ written notice of termination personally delivered;

b. by the Insured at any time on request.

2. Where this contract is terminated by the Insurer:

a. the Insurer shall refund the excess premium actually paid by the Insured over the proportional premium for the expired time, but in no event shall the proportional premium for the expired time be considered to be less than any minimum retained premium specified; and

b. the refund shall accompany the notice unless the premium is subject to adjustment or determination as to the amount, in which case the refund shall be made as soon as practicable.

3. Where this contract is terminated by the Insured…

4. The refund may be made by money, postal or express company money order or cheque payable at par.

5. The 15 days mentioned in clause 1.a) of this condition start to run on the day following the receipt of the registered letter at the post office to which it is addressed.

Perils Excluded

We do not insure loss or damages:

8. Intentional or Criminal Act or failure

resulting from any intentional or criminal act or failure to act by:

(a) any person insured by this policy; or

(b) any other person at the direction of any person insured by this policy.

DEFINITIONS

Insured means the persons(‘s) named as insured on the Declarations Page and while living in the same household:

1 His or her spouse;

2 Relatives of either;

3 Any person under 21 years old in their care.

Spouse means either of two persons who:

1. are married to each other; or

2. have together entered into a marriage that is voidable or void; or

3. have lived together in a conjugal relationship outside marriage continuously for more than one year,

[47] There is no dispute in fact that Primmum sent by registered mail a termination notice, pursuant to the Policy. There is also no dispute that the notice was received by the postal office; notice of the registered mail was sent to the plaintiff at the Property and that the registered mail was returned to Primmum by the postal service as being unclaimed.

[48] Further, there is no dispute that Primmum sent other letters to the plaintiff in October and November 2016. These letters were sent by ordinary first-class mail to the address of the Property concerning the default of paying the premiums and the termination of the Policy. These letters were not returned to Primmum.

[49] The plaintiff contends that Primmum cannot rely on the termination provisions of the Policy, because the plaintiff confirmed on July 26, 2016 that the payment was made and provided Primmum with updated information of her cell number, email addresses and her account with Scotiabank for payment. The plaintiff did not first breach the contract of insurance, Primmum did and cannot rely on the termination provisions in the Policy.

[50] I do not accept this contention.

[51] The plaintiff was under the contractual obligation to pay the premium when due. She did not. The plaintiff had access to the account of Stefan to pay the premiums. This is confirmed from her evidence that she deposited money into the TD Bank account to pay the premium by ATM deposit. This translates into the plaintiff having access to the account through an ATM in the end of July 2016. The plaintiff must have had Stefan’s client bank card and knowledge of his password. The premium was due July 25, 2016. The deposit was made on July 26, 2016. Notice of non-payment was made to Primmum on July 27, 2016. On July 25, 2016, the evidence shows that the TD Bank account exceeded the overdraft protection limit and there were no funds to pay the premium for the Policy.

[52] The evidence also indicates that the plaintiff did have access to the TD Bank account at the end of July 2016. She was aware that premiums were being paid through the TD Bank account. Stefan was residing in the Property until September 2016. He left to reside in Montreal from September 2016 to December 2016. He returned to the Property in December 2016.

[53] In examinations for discovery on July 30, 2019, the plaintiff’s answers to questions posed concerning the bank accounts and preauthorized payments were:

1. She and Stefan knew that expenses were to be paid.

2. Salary would go in every two weeks into the TD Bank account.

3. She and Stefan would generally check the bank accounts to make sure there was enough money to pay expenses including the home and auto insurance payments.

4. If the premiums were not paid, the insurance would be cancelled.[^7]

[54] The plaintiff was aware that payments out of her Scotiabank account would commence on and after August 25, 2016.

[55] It seems clear from the evidence that the plaintiff either did not examine the bank statements for the TD Bank account in July or August 2016 or the Scotiabank account from August 2016 to January 2017, or if she did so, she did not do so with precision. There is no doubt that from reviewing the two bank accounts, premiums for the Policy were not withdrawn. The plaintiff has provided no explanation for why she did not notice from reviewing both the TD Bank account and the Scotiabank account that the home insurance premiums were not paid for the months of July to December 2016.

[56] Notwithstanding the failure of the plaintiff to effectively examine the TD Bank account or her Scotiabank account, the plaintiff submits that the circumstances of her case are similar to that in Singh v. Sangha, Aviva and Traders[^8] where, on a summary judgment motion, the issue before the court was whether the automobile insurance policy was properly terminated for non-payment of premiums. Justice Chiappetta concluded that service by registered mail was proper service under the policy of insurance, but also found that the insurer, Aviva, only had authorization to withdraw from the account the monthly premium plus service charge, and Aviva’s attempt to withdraw from the insured’s account more than that authorized may not trigger termination of the policy for non-payment for there may have been the necessary amount in the bank account of the insured to pay the premium and service charges owed. Justice Chiappetta exercised his discretion due to “conflicting evidence” and did not grant summary judgment, and found a genuine issue for trial. I do not find this case helpful to the plaintiff. In the circumstances of her action, there is no conflicting evidence. Primmum attempted to withdraw the exact amount of the home insurance premium and NSF charge from the bank account it had authorization for, the TD Bank account, and there were not sufficient funds (by overdraft protection) to pay the premium on July 25, 2016.

[57] The plaintiff directs the court to the decision of Ontario (Minister of Finance) v. Progressive Casualty Co. of Canada[^9], which was relied upon in Singh. In Progressive, the insurer attempted to terminate a policy for non-payment of premiums after attempting to withdraw the premiums on other dates than was authorized for withdrawal. The court ascertained that it would be appropriate to set aside the cancellation of insurance, as the insurer breached the contract by improperly attempting to withdraw funds on dates not authorized. The plaintiff contends that Progressive shows that the court may set aside a cancellation in the circumstances when the insurer breached the contract of insurance.

[58] Though I may agree that the court has authority to set aside cancellation of an insurance policy in the appropriate circumstances, the situation here is not one of those appropriate circumstances. Primmum was authorized to and did attempt payment of the monthly premium on the date and in the amounts from the bank account it was so authorized.

[59] Moreover, in the contract of insurance between the plaintiff and Primmum, no provision was directed to the court that indicates that there is a contractual obligation on Primmum to advise the plaintiff in anyway that she failed to pay her monthly premium(s). The contract of insurance provides a process that Primmum must terminate the Policy and Primmum followed that process. A registered letter was sent along with follow-up letters. The plaintiff did not respond to any of those letters.

[60] I am also not persuaded that Primmum breached the provision of the Policy first and cannot rely on Clause 5, the termination clause. The plaintiff argues that Primmum did not provide the plaintiff with payment of any overpayment of premiums and as such, breached the terms of the Policy and cannot rely on the termination clause.

[61] First, the court was not directed to any judicial decision that indicates that failure to pay any overpayment of premiums by Primmum prevents it from relying on the termination clause of the Policy.

[62] Second, from my reading of the termination clause, I do not see that the payment of any overpayment by the plaintiff is a requirement before termination of the Policy. In reviewing the Policy, the court is cognizant that it must examine first the plain and ordinary meaning of the words used in the context of the entire Policy.[^10] The court is to give a broad liberal interpretation in favour of the insured to provide coverage and a strict interpretation of exclusionary clauses limiting coverage.[^11]

[63] From the plain ordinary meaning of the termination clause - Clause 5, it reads that the insurer “may” terminate upon following the procedure described in the clause. Clause 5(2) indicates that “when this contract is terminated by the insurer…”, which I interpret as meaning that once Primmum has terminated the Policy upon providing the 15 days written notice and there is termination, Primmum shall repay any overpayment. The payment of any overpayment is made after termination. Thus, the contention of the plaintiff, that by not making payment of any overpayment first vitiates Primmum’s right to terminate the Policy for non-payment of premiums, is not supported by the plain and ordinary meaning of Clause 5.

[64] The plaintiff also urges the court to accept the statement in March 2017 from an employee, that the Policy was void ab initio to conclude that all premiums made were owing to the plaintiff. As stated, any payment due is to be paid after any termination. Further, the use of “ab initio” by the employee does not alter the fact that Primmum terminated the Policy in September 2016, effective October 1, 2016. The statement from the employee, in my opinion, does not vitiate the termination. Moreover, I accept the explanation of Primmum that the employee was mistaken by using such a phrase that has a legal meaning.

[65] I will turn to the contention that Primmum negligently misrepresented the fact to the plaintiff on July 26, 2016, that the July 2016 home insurance premium was “processed”, that is from the plaintiff’s view, was paid.

[66] Pollak J. in Doumouras v. Chander[^12] describes the five legal requirements for negligent misrepresentation as:

1. there must be a duty of care based on a “special relationship” between the representor and the representee;

2. the representation in question must be untrue, inaccurate, or misleading;

3. the representor must have acted negligently in making said misrepresentation;

4. the representee must have relied, in a reasonable manner, on said negligent misrepresentation; and

5. the reliance must have been detrimental to the representee in the sense that damages resulted.

[67] Notwithstanding that the plaintiff did not make direct submissions on the legal requirement for negligent misrepresentation, I take it from her argument that Primmum owed her a duty of care based on their “special relationship”, gave inaccurate information concerning the July 25, 2016 monthly home insurance premium payment, and acted negligently or recklessly in doing so.

[68] The plaintiff’s view is that the conversation between the plaintiff and Primmum on July 26, 2016 indicates that Primmum represented that the premium was paid in full. However, that is not want what was stated. The conversation seems to state that the premium was “processed”. The evidence also is clear that Primmum did not know that the premium was not paid until the next day, July 27, 2016. So, even if a representation was made that it was “paid”, I have received no foundation to conclude that the representation was negligent or reckless at the time it was given. These facts are not in dispute between the parties.

[69] Hence, based on the evidence provided at the hearing, I cannot conclude that the plaintiff has satisfied the elements two and three of the five-part test, even if I accept a duty of care was owed.

[70] Consequently, I am not persuaded that there is a genuine issue for trial on the contractual claim of Primmum’s adherence to the terms of the Policy. I find that Primmum complied with the terms of the Policy when it terminated the Policy.

[71] Even if I am incorrect in my conclusion on Primmum’s termination of the Policy, I agree with Primmum that notwithstanding the termination, the plaintiff would not be entitled to payment for the loss sustained due to exclusions.

[72] There is no question that at the time of the fire the plaintiff and Stefan were married. The plaintiff contends that Stefan was only a guest and was not “living in” the household at the time of the fire. I reject this submission.

[73] At the time of the fire, Stefan was a married spouse of the plaintiff. He returned from Montreal. He was eating in the Property. He had dinners with the plaintiff and their daughter. He was sleeping at the Property. He had his personal belongings at the Property. Taking the plain ordinary meaning of “living in”, I interpret the phrase as meaning signs of habitation. Stefan’s showed such signs. He was not a person residing in the Property like a guest for a short-determined period waiting to move to another accommodation. He was living in the Property with the plaintiff and their daughter for an extended, undefined period. Stefan, I do find, was “living in” the Property. Thus, from the plain and ordinary meaning of insured and spouse in the Policy, Stefan was a spouse of the plaintiff and was an insured as defined in the Policy.

[74] The next question is whether the conduct of Stefan falls within the exclusion of an intentional or criminal act. The plaintiff contends that Stefan was suffering from both physical and mental illness. He was on an assortment of medication, as the plaintiff refers to as “a cocktail”. There also is no dispute in the fact that Stefan pled guilty to a criminal offence due to his conduct of setting the fire. By the guilty plea, Stefan accepted the elements of the offence, which includes the mens rea element of the offence.[^13]

[75] No medical or expert evidence was provided to indicate that Stefan’s conduct in setting the fire was neither intentional or criminal. No evidence was presented to opine on the effect, if any, of the medication that Stefan was ingesting, would have had on his behaviour. Both the plaintiff and the defendants have the obligation to “put their best foot” forward, and that the court may conclude that the evidence at the summary judgment motion is the best evidence that would be presented at a trial.

[76] On the evidence provided on this motion, the court concludes that:

1. Stefan and the plaintiff were married at the time of the fire.

2. Stefan was living in the Property at the time of the fire.

3. Stefan and the plaintiff are insured as defined in the Policy.

4. Stefan’s conduct in setting the fire was both intentional and criminal.

[77] Consequently, I am convinced on the balance of probabilities that the exclusion, Clause 8, dealing with intentional or criminal acts applies. There is no genuine issue for trial on whether the said exclusion prevents the plaintiff from a damage/loss claim from the Policy.

[78] At this point, I wish to add that I agree with the sentiment of E.M. Morgan J. in Soczek v. Allstate Insurance Co.[^14], that the exclusion for intentional and criminal acts in circumstances such as these can be characterized as “unjust and unreasonable.” But unfortunately, the exclusion as written was in effect at the time of the fire.[^15]

[79] The plaintiff also seeks damages for breach of standard of care, negligence.

Negligence

[80] In deciding whether a duty of care is owed by Primmum in the circumstances of this case, the questions to be applied have been established in Anns v. London Borough of Merton[^16], as adopted by the Supreme Court of Canada in Nielsen v. Kamloops (City).[^17]

[81] The two questions to be answered are[^18]:

1. Is there a sufficiently close relationship between the parties so that in the reasonable contemplation of Primmum, carelessness on part of the Primmum might cause damages to the plaintiff? If so,

2. Are there any considerations which ought to negate or limit (a) the scope of the duty and (b) the class of persons to whom a duty is owed or (c) the damages to which a breach of it may give rise?

For the first question, proximity is best understood as: was the harm that occurred, the reasonably foreseeable consequence of Primmum’s act. The first question is a low threshold.

[82] Though I did not receive submissions from the plaintiff on the two questions, from the circumstances of this matter, I am persuaded that the first question is answered in the affirmative. The relationship between the plaintiff and Primmum is a sufficiently close one that carelessness on the part of Primmum may cause damages to the plaintiff.

[83] Concerning the second question, are there considerations which ought to negate or limit the scope of duty; the class of persons to whom a duty is owed, or the damages to which a breach of duty may arise. The relationship between the plaintiff and Primmum is one founded on the terms of the Policy. The terms of the Policy concern the obligations owed between the plaintiff and Primmum. The Policy contains exclusions which limit the scope of the duty and liability for damages.

[84] As already stated, Clause 8, the exclusion concerning intentional or criminal act, applies. This exclusion states that Primmum does not insure any loss “resulting from any intentional or criminal act or failure to act by any person insured by the Policy.”

[85] Clause 8 limits the scope of the duty and eliminates any responsibility of Primmum to pay a loss in circumstances of an intentional or criminal act.

[86] Consequently, given the exclusion, Clause 8 of the Policy, there is no prima facie duty owed by Primmum to the plaintiff.

[87] The facts underling the relationship between the plaintiff and Primmum are not in dispute.

[88] I conclude that on the facts of this action, there is no genuine issue for trial concerning a duty of care owed to the plaintiff by Primmum to support a negligence claim asserted by the plaintiff.

[89] Accordingly, I need not utilize my powers under r. 20.04(2.1) of the Rules of Civil Procedure.

Disposition

[90] For the reasons given, I order that the motion and action of the plaintiff be dismissed.

Costs

[91] If the parties cannot agree on costs, the defendants are to serve and file their submissions on costs within twenty-one days from the date of this decision, and the plaintiff will have twenty-one days thereafter to serve and file her submissions. The submissions are to be no more than four pages, double-spaced, exclusive of any cost outline, case law and offers to settle. Submissions are to be filed with the court. There is no right for reply. If submissions are not received within the time period set out herein, an order will be made that there will be no costs.

Justice P.W. Sutherland

Released: December 9, 2020

[^1]: R.R.O. 1990, Reg. 194. [^2]: Hryniak v. Mauldin, 2014 SCC 7, at para. 49. [^3]: Ibid at para. 65; and Canaccord Genuity Corp. v. Pilot, 2015 ONCA 716, at para. 31. [^4]: Vincorp Financial Ltd. et al. v. Hope’s Holdings Inc., 2010 ONSC 6819, at para. 17. [^5]: Mason v. Perras Mongenais, 2018 ONCA 978, at para. 44. [^6]: See Meridian Credit Union Limited v. Ahmed Baig, 2016 ONCA 150, para.17. [^7]: Transcript of the Examination for Discovery on July 30, 2019 at pgs. 11-14. [^8]: 2014 ONSC 5147 (SCJ). [^9]: 2007 15475 (ON SC), [2007] 51 C.C.L.I.(4th) 35, [2007] O.J. No. 1769 (SCJ). [^10]: Horsefield v. Economical Mutual Insurance Company, 2017 ONSC 4868, at para. 24. [^11]: Ferro v. Weiner, 2018 ONSC 633, at para. 23. [^12]: 2019 ONSC 6056, at para. 25. [^13]: Abgey v. The Queen 1973 37 (SCC), [1975] 2 S.C.R. 426. [^14]: 2017 ONSC 2262, at para. 39. [^15]: I do note that the legislature amended the effectiveness of this exclusion in 2017 with an amendment to the legislation-section 129.1, Insurance Act, RSO 1990, c. I.8, which came into force January 1, 2018. [^16]: [1978] A.C. 728, [1977] 2 W.L.R. 1024 (H.L.). [^17]: 1984 21 (SCC), [1984] 2 SCR 2. [^18]: Ibid, para. 40.