Motor Vehicle Policy Found Not to be Assignable
Motion for summary judgement brought against the insurer by a plaintiff who claimed to be an assignee of the insured’s automobile policy. The action was dismissed. The policy was not assignable in the circumstances. Alternatively, the policy had not been breached and therefore no cause of action was available to the insured or an assignee.
Insurance law – Automobile insurance – Policies and insurance contracts – Assignment – Breach of policy – Damages
ResQ Auto Glass Inc. v. Co-operators General Insurance Co.,  O.J. No. 663, February 11, 2015, Ontario Superior Court of Justice, W. Low J.
This was a motion by the plaintiff for summary judgement and a cross motion by the insurer for summary dismissal. In contrast to regular auto glass and repair companies, the plaintiff was a company who trolled areas were cars might be found with their owners (the insured), identified chips on windshields, and then approached the insured offering its repair services. The insured was then asked to sign a work order which stated that the insured would pay nothing for the repair and contained a very small print assignment of rights in favour of the plaintiff against the insurer. The insurer had an authorization agreement with the plaintiff which clearly stated that the plaintiff would be paid no more than $50 per repair. The plaintiff would send the insurer an invoice after each repair.
However, the plaintiff started to invoice the insurer $100 per repair. The insurer refused to pay more than $50 per repair. The plaintiff brought an action for breach of contract, seeking $208,359.57 in unpaid repair invoices. The plaintiff argued that $100 was the market rate and that it was an assignee of the insured’s insurance, or, alternatively, an assignee of the proceeds of the insured’s claim on the policy arising from the windshield repair. The insurer relied on the clear terms of the authorization.
The court found that the insurer had satisfied its obligations under the authorization. The fact that the plaintiff led evidence relating to market value (which it found unconvincing) did not derogate from the terms of the authorization. Further, the court found that the plaintiff was not an assignee. The policy was not assignable and the absurdity of assigning an automobile policy in consideration of windshield repair was not lost on the court. Alternatively, absent a breach of the policy, the insured had no right of action against the insurer. As policy had not been breached, the plaintiff had no cause of action had it been an assignee.
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