Question
How do I know if this information is enough to find Canada Life liable for the negligence of the bank employees? Below is the case,
How do I know if this information is enough to find Canada Life liable for the negligence of the bank employees?
Below is the case,
The Gooderham case demonstrates how apparent authority can result in a principal being bound by the actions of its agent. Gooderham and her husband (now deceased) went to the bank of Nova Scotia for a $55 000 mortgage. They filled in an application for mortgage insurance but the bank failed to forward it to Canada Life, the insurer. Had the bank done so, Canada life would have denied coverage because of Mr. Gooderham's poor health. Still, the bank collected premiums until Mr. Gooderham died, at which time Canada Life denied coverage.
Mrs. Gooderham sued and the Court awarded judgement other, concluding that the bank, through its employee, had apparent authority to represent Canada Life. The bank had the application forms supplied by Canada Life and supplied them to the Gooderhams. The bank, on behalf of Canada Life, sought out prospective policy holders, assisted in completing the applications for insurance, supplied rate information, accepted premiums, forward the money and forms to Canada Life, and was paid for this service by Canada Life. Given these factors it was reasonable for the Gooderhams to assume that the bank had authority to represent the insurer.
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