Valentyne Estate v. The Canada Life Assurance Company

Kevin Valentyne was driving his car in downtown Vancouver on January 7, 2013. His girlfriend was with him. After receiving a telephone call, he drove to a house, entered it, with his car engine running. He told his girlfriend he would be right back. He never returned.

His blood was found in the house, but not his body, which has not been found.

Mr. Valentyne’s mother petitioned the Supreme Court of British Columbia for an order declaring that he be presumed dead. The order was granted.

Mr. Valentyne had a life insurance policy with Canada Life to pay his mortgage if he died. His mother acting as the administrator of his estate applied to have the life insurance paid out. Canada Life denied coverage. She sued in the Supreme Court of British Columbia, and lost. She appealed to the British Columbia Court of Appeal.

Life insurance policies often have exclusion clauses that provide that if the insured dies while involved in crime, the insurer does not have to pay. In this case, the insurance policy provided that Canada Life would not pay the benefit if “· your death is a result of or while you were committing, a criminal offence [Emphasis in original.]”

There was evidence that Mr. Valentyne was a drug dealer and was associated with a gang. The house he entered was a known drug reload house. His mother’s lawyer conceded at trial that he was likely murdered by individuals at the behest of a rival gang. She had relied on this evidence when she applied for an order that he be presumed dead.

One of Mr. Valentyne’s mother’s grounds for appeal was based on the interpretation of the exclusion clause. Madam Justice Bennett, in Valentyne Estate v. The Canada Life Assurance Company, 2018 BCCA 484, considered the meaning of the phrase “your death is a result of or while you were committing, a criminal offence.” There are two ways a death can come within this exclusion. The exclusion may apply if the deceased died while committing an offence, and also if the deceased died as a result of a criminal offence.

Madam Justice Bennett found the first of these, dying while committing an offence to be clear. With respect to dying as a result of a criminal offence, she held that this clause must be interpreted to mean that the death was caused by the deceased’s criminal offence, in contrast to a death caused by another’s criminal offence. Otherwise, life insurance could be denied to the victim of someone else’s crime. The deceased must have perpetrated the crime for the exclusion to apply.

She quoted a leading text in explaining the distinction between the two ways that the clause may come in to play:

[30]         The distinction between dying while committing a criminal offence and dying as a result of committing a criminal offence is that the latter involves a causal connection. This is described by David Norwood and John P. Weir in Norwood on Life Insurance (Toronto: Carswell, 2002) at 462:

Causal connection would not seem to be required where the provision excludes death while committing or attempting to commit a criminal offence, but it would appear to be necessary where the exclusion is for death resulting from committing or attempting to commit such an offence. If a bank robber rushes onto a roadway in the course of making a get-away and is knocked down by a car, the causal connection would be established, but if he is casually strolling on the sidewalk away from the scene of the crime, and a brick falls on the robber’s head, it would seem that the claim for the accidental death insurance benefit may still be made.

Although, Madam Justice Bennett found that the trial judge made some errors in the scope of the exclusion clause and in admitting some of the evidence, the Court of Appeal held that there was sufficient evidence to infer that Mr. Valentyne died while committing a criminal offence. Madam Justice Bennett wrote:

[44]         Nevertheless, taking into account the evidence that was not contested and the admissions made, the inescapable inference is that Mr. Valentyne died while committing the criminal offence of possession, trafficking or possession for the purpose of trafficking illicit drugs, all of which are indictable offences. He was a known drug dealer, he went to a known drug reload house, he was affiliated with a criminal gang, and his intention was to go into the house and quickly return. The only logical inference from this circumstantial evidence is that he bought or sold drugs at that location, was murdered, and therefore died while committing a criminal offence, invoking the exclusion clause.