TD Insurance Company v. Skrinjar, 2025 ONSC 266
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By: Sarah Richard (Articled Clerk)
This case involves an application for judicial review made by TD Insurance, the Applicant, which sought to overturn an umpire’s decision under Statutory Condition 11 of the Insurance Act, R.S.O. 1990, c I.8, following a fire loss at property owned by Steve Skrinjar, the Respondent. The Respondent held a homeowner’s insurance policy with TD Insurance covering up to $5 million for fire-related losses with the insurer obligated to pay either repair or replacement costs, whichever was lower, provided repair was viable.
After the fire, the Respondent submitted a proof of loss claim, which the Applicant denied. The Respondent invoked the appraisal process under section 128 of the Insurance Act. Both parties appointed appraisers, who jointly selected Peter Volaric as the umpire.
The main issue centered on whether repairing the property’s damaged indoor pool was a viable option. The Applicant’s appraiser argued in favour of repair, while the Respondent’s appraiser claimed repair was not feasible. During the appraisal hearing, the umpire reviewed over 700 pages of material and, after consulting both appraisers, concluded that repairing the pool was not viable. Consequently, he awarded damages based on the replacement cost.
The Applicant challenged the umpire’s decision on three grounds:
(1) that the umpire exceeded his jurisdiction by deciding the repair viability issue;
(2) that the umpire demonstrated a reasonable apprehension of bias; and
(3) that procedural fairness was denied during the appraisal process.
The court applied a standard of reasonableness in reviewing the umpire’s decision. It held that the umpire acted within his jurisdiction, as determining whether repair was viable was integral to assessing the value of the loss. Referring to Aviva Insurance Co. v. Friedman, 2024 ONSC 2886, the court noted that appraisers and umpires can assess whether damage necessitates repair or replacement when determining loss amounts.
On the issue of bias, the Applicant alleged that the umpire showed partiality by excluding its adjuster from the hearing, refusing further evidence on repair once deemed unviable, and favouring the Respondent’s evidence. The court dismissed these claims, emphasizing the high evidentiary threshold required to establish bias and finding no misconduct. The umpire’s decisions reflected his discretion to control the process, not partiality.
The Applicant’s claims of procedural unfairness were also rejected. The court found that the umpire acted within his broad discretion to manage the appraisal process, including limiting submissions after deciding that repair was not viable.
Ultimately, the court dismissed TD Insurance’s application and upheld the umpire’s award. The Respondent was awarded $7,500 in costs as the successful party.
