October 27, 2009 by Canadian Underwriter
The Ontario Superior Court has upheld the insurer’s denial of a claim for allegedly stolen possessions that were moved into storage after a plaintiff abandoned his home.
In Harris v. Home Trust Company, Steven Harris entered into a policy with Meloche Monnex, which insured the household goods within Harris’ home.
In July or August of 2004, Harris moved out of the house, leaving the home in the possession of a tenant. He did not advise Meloche he had vacated the premises.
The mortgage on the home went into default in July 2004. Power of sale proceedings were initiated in August.
The mortgagee took possession of the home on Feb 3, 2005 after a writ of possession was issued in January 2005.
The tenant moved out on Feb. 3, 2005, leaving Harris’ belongings in the home.
Harris was notified that he needed to remove his possessions by Feb. 17, after which time they would be considered abandoned.
Harris did not remove his belongings. The sale of the house closed on Apr. 8, 2005 and his insurance policy with Meloche expired the next day.
The mortgagee arranged for Harris’ belongings to be moved to a storage facility. Later, the items were moved to another storage facility.
Harris went to retrieve his items on June 3, 2005. At that time, he alleged only half of his property remained, with the balance of his goods damaged or missing.
He reported the alleged theft to the police in September 2005. On Apr. 3, 2006, he filed a proof of loss with Meloche, claiming the loss of goods valued at Cdn$71,031.
In his proof of loss, he included property related to a business, in addition to a boat, trailer and accessories stored at the property and valued at Cdn$12,700.
He conceded his household policy did not cover certain business belongings that were claimed in his proof of loss.
Correspondence from Transport Canada shows the boat was observed partially submerged on Nov. 4, 2004.
Transport Canada deemed it a pollution threat and demanded that the plaintiff haul it out of the water. The plaintiff admitted he failed to do so, and the boat was pushed downstream by ice in the spring.
“When the plaintiff submitted his proof of loss and included the boat in it, he made a fraudulent insurance claim that results in no recovery under the insurance policy,” Ontario Superior Court Justice Helen Pierce wrote. “He has vitiated coverage under the entire policy. He cannot now expect the insurer to pay partial recovery in the face of the common law rule.”
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