The Court recently considered the Insurer's requirements in
cancelling an insurance policy. In Singh v Sangha [2014 ONSC 5147], the
Insurer brought a summary judgment motion on the basis that it
terminated the Plaintiff's motor vehicle insurance policy prior
to the accident. As a result of the accident, the Plaintiff had
commenced a tort claim and a claim for statutory accident
In July 2004, pursuant to a policy renewal notice, Aviva issued
a standard OAP (Ontario Automobile Policy) motor vehicle
liability policy with Harvinder Singh ("the Plaintiff")
as the named insured. The Plaintiff was to pay a premium
pursuant to a monthly payment schedule. The payments were to
be automatically withdrawn. The monthly automatic withdrawal
for July 30, 2008 was not completed because of insufficient
Aviva wrote to the Plaintiff on August 8, 2008 and explained
that it received notice from the Plaintiff's bank that there
were insufficient funds. Aviva explained it would withdraw
both July and August payments at the same time. The letter
further stated that if there were not sufficient funds in the bank
account to cover the full amount owing, Aviva would cancel the
policy for non-payment of premiums.
When Aviva attempted to withdraw the payment on August 30, 2008,
the withdrawal was not completed due to non-sufficient funds.
On September 10, 2008, Aviva sent a letter to the Plaintiff by
registered mail with the notice of cancellation. The
registered letter was sent to his residential address. The letter
advised that Mr. Singh had until October 12, 2008 to pay the
outstanding premium or else the policy would be cancelled. No
payment was received.
On December 13, 2008, the Plaintiff was struck by a van while
crossing a parking lot.
The Court dealt with Section 12 of the Statutory Conditions that
dealt with effective delivery and states:
Written notice may be given to
the insured named in this contract by letter personally delivered
to the insured or by registered mail addressed to the insured at
the insured's latest post office address as notified to the
The Court noted that the notice of cancellation was sent to the
Plaintiff by Aviva by registered mail at his home address.
Delivery was attempted on September 12, 2008, but the Plaintiff was
not there. Canada Post held the registered notice for pickup until
October 3, 2008 when it was declared unclaimed. On October 6,
2008, the letter was returned to Aviva.
There was no dispute that the Plaintiff had not received the
notice. It was also not in dispute that the Plaintiff lived
at the address where the letter was sent. The Plaintiff did
not receive the notice because he failed to pick it up from the
Brampton West Office of Canada Post, although he could have.
The Court concluded there was no duty on the Insurer to
follow-up on return mail or to go looking for an insured after it
complied with Section 12.
The Court held that Aviva complied with the statutory
requirements for the delivery of registered mail. The Court
concluded that the registered mail was effectively delivered to the
Plaintiff in a manner legally capable of effecting cancellation of
the policy. Summary judgment was granted dismissing the Claim
and Crossclaim against Aviva as it pertained to Statutory
Condition 12. The Court adjourned submissions with respect to
effective termination pursuant to Statutory Condition 11 in
order to have an opportunity to produce banking records to be
The decision is important as it confirms that insurers are not
required to ensure that an insured receives a Notice of
Confirmation. However, insurers need to comply with the notice
requirements including sending the letter by registered mail to the
proper address. In the event that there is a future claim advanced
on the policy, insurers are able to take steps to summarily dismiss
Automobile drivers, like fine wine, tend to get better with age. Older drivers can draw on a wealth of experience from their years on the road to assist them when faced by a variety of dangerous conditions.
Under B.C.'s former and current Limitation Act, the limitation period for a Plaintiff's claim can be extended on the basis of a Defendant having acknowledged in writing some liability for the cause of action.
The insurance industry will be interested in Ledcor Construction Ltd v. Northbridge Indemnity Insurance Co because of principles the Supreme Court of Canada applied to the "faulty workmanship" exclusion in a Builders' Risk policy.
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For the first time in BC, a Court has decided that an insured is entitled to special costs, rather than the lower tariff costs, solely because they were successful in a coverage action against their insurer.
Policyholders recently won a key victory at the Supreme Court of Canada in Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co. as the Supreme Court clarified the interpretation of a standard form...
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