The plaintiff, Marcel Desrochers, sought “100%” of the replacement costs, which he valued at over $300,000, yet submitted insufficient and fraudulent evidence as the proof of loss, the court determined.
Desrochers is the owner of Frenchie’s Farm and Ranch Ltd. in Glenora, Manitoba. On Jan. 11, 2011, a fire broke out on his farm property, resulting in a complete loss of the building and its contents – a two-storey house, detached garage and several outbuildings.
Desrochers told the court he had no records of where the items he was claiming were purchased, when they were purchased, or how much they cost, as those records were lost in the fire. Counsel for Desrochers, whose first language is French, said his client obtained the replacement cost values by calling stores and accessing the internet with the help of his son.
Roseanne Reinke, senior claims examiner, testified for Peace Hills. Kevin Klasson, an independent appraiser hired by Peace Hills, testified that the property’s estimated value was $357,014. But Peace Hills Insurance Company said the policy was void because Desrochers had made willfully false statements on his proof of loss form, and provided unsatisfactory documentation of the value the items allegedly lost in the fire.
Desrochers could not remember where he purchased the items, or for how much, and could only recall that he paid with cash. His first attempt at filling out the proof of loss form, given to him by his lawyer, was deemed incomplete because it did not include a schedule of loss identifying the property destroyed in the fire, the value of those items, or the cost of replacing them.
Desrochers then submitted a second, partially completed schedule of loss form that was 49 pages long. It still contained no information regarding the amounts claimed under the policy, where the items were purchased, or for how much, only stating that the plaintiff was seeking “100%” of the replacement cost.
The insurer rejected this second proof of loss form, and no further one was submitted by the plaintiff.
“His inability or refusal to do so leads me to the conclusion than this is simply a list he concocted with a view to receiving a grossly inflated insurance payout,” determined the justice of the court.
Desrochers also attempted to claim equipment, including three computers he valued at over $6,000, a $4,000 printer, and video cameras worth $4,375, even though he testified that he didn’t know how to use computers.
What’s more, although Desrochers couldn’t sufficiently prove where he made his purchases, he professed that he would’ve purchased them all within a 10-year period prior to the fire, after his divorce. At the same time, he testified, his wife took most of the household possessions with her when she separated from him. “His evidence in this regard is not believable,” the court decided.
Desrochers said he did not intend to deceive, but that various difficulties, including the language barrier, complicated how he filled out the proof of loss forms. Peace Hills didn’t buy that explanation, entering into evidence that Desrochers had a criminal record, including a prior conviction for false pretenses and fraud under $5,000, as well as theft and possession of property obtained by crime.
Based on all of these considerations, the lower court determined that a claim is voided in its entirety when an insured person makes an intentionally false declaration. Desrochers appealed the decision a year later, stating the lower court was mistaken for voiding the entire policy because of his contents declaration.
“Not all incomplete, inaccurate or exaggerated proof of loss submissions vitiate an insurance claim,” he contended.
But Manitoba’s Court for Appeal upheld the lower court ruling on Jan. 21, 2022. Contrary to what Desrochers claimed, the appeal court decided, this was not a “circumstance of imperfect compliance,” but there was ample evidence that Desrochers gave a deliberate false statement.