Frenchie’s Farm and Ranch Ltd v Peace Hills Insurance Company, 2022 MBCA 10

Citation: Frenchie’s Farm and Ranch Ltd v Peace Hills Insurance Company, 2022 MBCA 10 Date: 20220128 Docket: AI21-30-09603 IN THE COURT OF APPEAL OF MANITOBA Coram: Madam Justice Diana M. Cameron Madam Justice Karen I. Simonsen Madam Justice Lori T. Spivak BETWEEN: ) M. T. DuffyFRENCHIE’S FARM AND RANCH LTD. ) for the Appellant ) (Plaintiff) Appellant ) D. G. Giles and) K. M.

Yakimoski ) for the Respondent- and - ) ) Appeal heard and ) Decision pronounced:PEACE HILLS INSURANCE COMPANY ) January 21, 2022 ) (Defendant) Respondent ) Written reasons: ) January 28, 2022 COVID-19 NOTICE: As a result of the COVID-19 pandemic and pursuant to r 37.2 of the MB, Court of Appeal Rules, MR555/88R, this appeal was heard remotely by videoconference.

On appeal from 2021 MBQB 33 spivak JA (for the Court): [1] The plaintiff appeals the trial judge’s dismissal of its claim for payment under an insurance policy issued by thedefendant relating to a fire loss that occurred on January 11, 2011, and destroyed the plaintiff’s farm dwelling, outbuilding and contents. At the conclusion of the hearing, we dismissed the appeal with reasons to follow. These are those reasons. [2] The plaintiff argues that the trial judge erred in (1) dismissing the entirety of its claim pursuant to statutory condition7 of The Insurance Act, CCSM c I40,

section 136.4,

Schedule B (the Act), on the basis of a wilfully false statement in the proof of losssubmitted; (2) finding that the plaintiff was not entitled to relief from forfeiture; and (3) finding, in the alternative, that the plaintiff didnot comply with statutory condition 6 of the Act because the documentation submitted did not prove the claim. [3] We see no error warranting appellate intervention. [4] We reject the plaintiff’s contention that the trial judge erred in law in failing to consider that “not all incomplete,inaccurate or exaggerated proof of loss submissions vitiate an insurance claim”, or that he made a palpable and overriding error infinding a wilful intent to deceive on the part of the plaintiff’s principal, Marcel Desrochers. [5] The trial judge correctly noted that a false statement will violate statutory condition 7 if it is made knowingly withoutbelief in its truth or recklessly without caring whether it is true or not (see para 15; see also Kucharsky et al v Red River Valley MutualInsurance, 2002 MBQB 28 at para 70; Pereira v Hamilton Township Farmers’ Mutual Fire Insurance Co (2006), (ON CA), 267 DLR (4th) 690 at paras 98-100 (Ont CA); and Pinder Estate v Farmers Mutual Insurance Company (Lindsay), 2020

ONCA 413 at para 91 ). Further, he noted that, where an insured makes an intentionally false declaration, the claim is voided in its entirety (see para 14; see also Swan Hills Emporium & Lumber Co v Royal General Insurance Co , 1977 CarswellAlta 2 at para 35 (SC (AD)) ). The trial judge also recognized the burden on the insurer to prove fraud on the balance of probabilities and was satisfied that there was clear and cogent evidence in this regard.

His conclusion, that Desrochers was incredible and submitted a wilfully false statement because of the grossly exaggerated content and lack of any detail in the proof of loss, followed a careful and detailed assessment of the evidence, and is amply supported by the record. His credibility findings are entitled to deference absent palpable and overriding error, which has not been demonstrated. [ 6 ] Additionally, having found that this was not a circumstance of imperfect compliance, but rather a deliberate false statement, the trial judge made no error in concluding that relief from forfeiture under

section 130 of the Act was unavailable. If the insured deliberately misleads the insurer, relief from forfeiture will not be granted (see Permaform Plastics Ltd v London & Midland General Insurance Co , 1996 CarswellMan 325 at paras 128-29 (CA) ). [ 7 ] Finally, although not necessary to decide, in light of our rejection of the above-noted grounds of appeal, we similarly find no error in the trial judge’s alternative conclusion of a failure to comply with statutory condition 6. [ 8 ] For these reasons, the appeal was dismissed with costs. JA JA JA