Can the defendant qualify as part of her father’s house and have the action brought against her dismissed? Does the declaration of co-ownership contain clauses that constitute a waiver to sue the co-owners?
These are the questions addressed by the Honourable Alexander Pless, Justice of the Superior Court of Quebec, in Intact compagnie d’assurance v. Vigeant, 2023 QCCS 937.
Summary of facts
On April 22, 2018, an apartment building located at 8548 to 8558 rue Joseph-Quintal in Montreal (“the Building”) was extensively damaged by a fire that started on the patio of a unit owned by Mr. Alain Vigeant (“Mr. Vigeant”). According to plaintiffs’ allegations, the fire was caused by the negligence of Mrs. Virginie Vigeant (“Mrs. Vigeant”), Mr. Vigeant’s daughter, who extinguished one or more cigarettes in a flowerpot while visiting her sister, who occupied the unit belonging to their father, Mr. Vigeant.
Several files were joined together. In the file bearing court number 500-17-118271-215 (“-215”), the plaintiff, Royal and Sun Alliance of Canada (“RSA”), is the Insurer of the Syndicate of Co-ownership named Copropriété lot 818 (” Syndicate “). The Syndicate was also one of the plaintiffs along with other divided co-owners of the Building in file number 500-17-118269-219 (“-219”).
Plaintiffs’ Claims
In file -215, RSA claims that Mrs. Vigeant and her insurer, Square One Insurance Services Inc. (“Defendants”), should pay the amounts paid by RSA to its insureds following the fire. In file -219, the Syndicat and the divided co-owners are claiming compensation for damages they allegedly sustained, but which were not paid by RSA.
Defendants’ motion to dismiss
The lawsuits in files -215 and -219 are the subject of Defendants’ Motions to Dismiss, on the basis that the Claims in files -215 and -219 are not founded in law.
In file -215, the defendants argue that RSA cannot sue Mrs. Vigeant because she is a member of the household of the insured, her father, pursuant to article 2474 of the Civil Code of Québec (CCQ) and because of the wording of the Declaration of Co-ownership.
With regards to file -219, defendants allege that certain clauses of the Declaration of Co-ownership, namely those creating an obligation to insure and those of non-subrogation, constitute an implicit waiver of the right to sue the co-owners and their families, including Mrs. Vigeant.
Decision of the Court
The criteria applicable to a Request for Dismissal are as follows:
- The alleged facts must be considered proven;
- The question is to determine whether the claim is unfounded in law, assuming that the factual allegations are true;
- The Court must exercise circumspection in the exercise of this power;
- Only a clear and manifest lack of legal foundation will lead to the dismissal of the claim;
- The Court may consider the facts alleged and the exhibits alleged in support of the claim, but only to supplement the allegations and not to render a decision based on this evidence;
- The judge called upon to rule on the admissibility of a claim must determine whether the allegations of fact set out in the claim are such as to give rise to the conclusions sought;
- A motion to dismiss cannot be dismissed on the grounds that it raises complex issues;
- In case of doubt, plaintiff must be given the opportunity to be heard on the merits.
Was Mrs. Vigeant part of her father’s household and, consequently, should RSA’s recourse in file -215 be dismissed?
Section 2474 CCQ provides that an insurer cannot be subrogated in the rights of its insured against persons who are part of the insured’s household. The Quebec Court of Appeal has consistently interpreted the notion of “household of the insured” broadly and generously, in order to achieve its objective of preventing an insurer from suing a person whom the insured, in whose rights it is subrogated, would not have chosen to sue. In other words, to prevent the insurer from suing “persons who it would have been unthinkable for them to sue because of their relationship with the insured”.
The Court analysed previous case law to note that the objective is also to avoid rendering the insurance ineffective by forcing an insured to renounce to his insurance contract and to his right to indemnity in order to prevent a member of his immediate family from being sued. In Martel vs.Martel the Court of Appeal clarifies that the term “insured’s household” includes members of the insured’s immediate family, and that the concept refers to persons and not to a physical location. Persons do not have to live on the insured premises, and nothing in the law limits the exception to a dwelling or to the insured’s residence.
In light of the case law analyzed, the Court concluded that the motion to dismiss the action in file -215 should be granted. Indeed, even taking the facts alleged in the RSA application as proven, the Court concluded that the action was not founded in law. He noted that “the case law on the meaning to be given to the notion of ‘insured’s household’ is clear in wanting the insured’s daughter to be included in the notion” and that “it is the relationship between Mr. Vigeant and his daughter that is decisive”.
The plaintiffs also argued that Mr. Vigeant is not the subrogating insured at the origin of RSA’s subrogatory recourse, and that it is therefore irrelevant to determine whether or not the defendant is part of Mr. Vigeant’s household. However, according to the defendants, Mr. Vigeant is an unnamed insured under the insurance policy taken out by the Syndicate and, consequently, the protection against subrogation benefits the members of Mr. Vigeant’s household. The Honourable Justice Pless disagreed with the plaintiffs’ argument and noted that “the protection against subrogation of persons forming part of the insured’s household is extended in the context of co-ownership by the nature of the relationship between the parties”.
Is the recourse of the Syndicat and the other divided co-owners doomed to failure because of any waiver to sue the owners and their family members?
This argument did not convince the Court that the Syndicat’s and the co-owners’ recourse was doomed to failure.
Plaintiffs also alleged that their recourse did not arise from subrogation, and that it was based on Ms. Vigeant’s extra-contractual civil liability.
In this case, the Declaration of Co-ownership creates ambiguities. Indeed, one of its clauses provided for the Syndicate’s obligation to insure against fire damage did not contain an explicit obligation to obtain a non-subrogation clause with respect to the co-owner’s family members. This has no effect on the protection against subrogation provided by article 2474 CCQ. However, since the plaintiffs claimed that their recourse did not arise from subrogation but directly from the fault of the defendant., they did not implicitly waive their right to sue the co-owners’ family members.
In view of the caution it must exercise in dismissing claims and the need to interpret the Declaration of Co-ownership beyond what is permitted at the preliminary stage, the Court dismissed the Motion to Dismiss as it was unable to conclude that the action was doomed to failure.
