Can an insurer pursue a defence of fraud against an insurer alleging that a theft was arranged by the owner to avoid vehicle repair costs?
Ontario, Canada
The following excerpt is from Lawyers' Professional Indemnity Company v. Geto Investments Limited, 2007 CanLII 27756 (ON SC):
In Andryechen v. Transit Insurance Co.[37], an insurer alleged that a theft of a truck was arranged by the owner in order to avoid vehicle repair costs. Although the insurer had not satisfied the onus of proving fraud on a balance of probabilities, the court nevertheless denied the plaintiff’s claim for punitive damages and held that it was reasonable for the insurance company to pursue a defence of fraud and that there was no evidence to support a finding that it’s behaviour was malicious, vindictive or reprehensible. The court stated “the fact that the defence failed does not convince me that the decision to defend was totally without merit”.
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