Canada, Theall Group LLP updates


Contributed by Theall Group LLP
No faulty workmanship in Alberta Court of Appeal's interpretation of common exclusion clause
  • Canada
  • 06 October 2020

The Alberta Court of Appeal recently addressed a recurring coverage issue: the conflict between the broad protection intended by an 'all perils' property insurance policy and an exclusion for the costs of making good faulty workmanship. Based in part on the general purpose of such insurance, the decision held that property damage directly caused by the faulty workmanship of a contractor was covered, as long as it was outside the scope of work for which the contractor had been hired.

That's cold: insurer ordered to defend claims made against cold storage provider
  • Canada
  • 22 September 2020

The Alberta Court of Appeal has ordered an insurer to defend claims made against its insured's cold storage business, which was sued when its warehouse thawed and damaged its customer's food products. This case illustrates that it is important to always review a policy's specific words to determine what it covers rather than rely on received wisdom about what a policy typically covers.

Concurrent duty to defend – a team sport
  • Canada
  • 15 September 2020

In a recent case, the Ontario Court of Appeal addressed three important elements of the duty to defend where there is concurrent coverage under two policies – namely, whether there was a concurrent duty to defend given the existence of an 'other insurance' clause, the obligation to pay ongoing costs and its allocation and the right to participate in the defence.

Court awards commercial pre-judgment interest rates on successful coverage claim
  • Canada
  • 25 August 2020

The Ontario Superior Court of Justice recently held that an insurer which wrongfully denied a US$121 million claim must pay pre-judgment interest based on the actual cost of borrowing and not the rates stipulated in the Courts of Justice Act. Counsel and adjusters would be wise to carefully consider this case in any future insurance coverage dispute, as it sets out a number of factors that a court could consider in deciding whether to award commercial interest rates.

Novel case on data exclusion interpreted in favour of insureds
  • Canada
  • 21 July 2020

An Ontario judge recently interpreted a data exclusion in favour of the insureds, ordering the insurer to defend claims arising out of an alleged website security breach. This case reaffirms the principle that exclusions are to be read narrowly, not broadly. Particularly where the relevant policy provisions engage complex issues not yet judicially considered, the court may err on the side of finding for the insured.

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