B.C.J. No. 892
2011 BCCA 232
British Columbia Court of Appeal
M.V. Newbury, P.D. Lowry and P.A. Kirkpatrick JJ.A.
May 12, 2011
An appeal by a life insurance beneficiary, a life insurance consultant, and an insurer following a dismissal of their applications for summary judgment regarding whether a life insurance policy should be reinstated; the beneficiary’s appeal was dismissed as well as her action, while the appeal by the life insurance consultant and the insurer was allowed.
Mr. Gish held two policies of life insurance issued by Transamerica Life Insurance Company of Canada (“Transamerica”). Mrs. Gish, his wife, was the beneficiary under both policies. Contrary to advice given to him by a life insurance consultant, Mr. Gish instructed his insurer in writing to cancel both policies in the fall of 2004 in order to reduce his monthly expenses. Transamerica had sent Mr. Gish written confirmation of the cancellation. When Mrs. Gish learned about what her husband had done, she called Transamerica and they again confirmed that the cancellation had been completed. No request for reinstatement was made and no further premiums were tendered. Mr. Gish passed away the following year.
Two years later, Mrs. Gish sought to have the policies reinstated or damages awarded to her on the basis that the cancellation was ineffective, the policies had merely lapsed, and that the consultant and insurer had breached duties owed to her in failing to advise her that that she had a right as a beneficiary to preserve the policies by assuming the premium payments. An application for summary judgment was made by each of the parties. The trial judge dismissed the applications on the basis that issues could not be properly addressed summarily. Each party appealed.
Mrs. Gish’s appeal was dismissed and the appeals by Transamerica and the insurance consultant were allowed. The Court of Appeal held that the policies were Mr. Gish’s and he was free to cancel them if he wished to do so. The policies were cancelled once Mr. Gish instructed his insurer to do so in writing in the fall of 2004. Once he did so, there was no basis upon which Mrs. Gish could preserve them or compel their reinstatement. As such, there was no issue as to whether there was no failure to inform her of an ability to preserve the policies. The Court of Appeal concluded that the trial judge should have dismissed the action as there were no conflicts in the evidence which precluded summary disposition.