[C.S.], et al. v. TD Home and Auto Insurance Company

(Ontario) (Civil) (By Leave)

(Publication ban in case) (Publication ban on party)




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Insurance – Liability insurance – Insurers’ duty to defend and indemnify – Negligence – Whether Court of Appeal’s decision changes purpose of obtaining insurance policy and doctrines of reasonable expectations, contra proferentem and nullification of coverage – Whether insurer can nullify coverage under exclusion clause that is silent as to whether particular excluded acts must be intentional or unintentional – Whether interpretation of insurance contract is a question of mixed fact and law requiring appellate courts to give deference to trial judge’s decision per Sattva Capital Corp. v. Creston Moly Corp., 2014 SCC 53, [2014] 2 S.C.R. 633.

The applicants, C.S. and J.G., have a homeowners’ insurance policy with the respondent, TD Home and Auto Insurance Company. The policy includes liability coverage if their personal actions cause unintentional bodily injury or property damage. C.S. and J.G. are defendants in a lawsuit where the anchor claim is that their daughter and two other girls, all Grade 8 students, bullied a fellow student, causing her physical and psychological injuries. The claim against C.S. and J.G. sounds in negligence, namely, their failure to control their daughter. C.S. and J.G. requested that TD defend and indemnify them pursuant to the insurance policy. TD refused, relying principally on two exclusion clauses in the policy. C.S. and J.G. brought an application seeking a declaration that TD had a duty to defend and indemnify them in the underlying action.

The Ontario Superior Court of Justice granted the application for a declaration that the respondent has a duty to defend and indemnify the applicants in the underlying action. The Ontario Court of Appeal unanimously allowed the appeal, set aside the judgment of the Superior Court of Justice, and declared the respondent does not have a duty to defend and indemnify the applicants.

Lower Court Rulings

December 9, 2014
Ontario Superior Court of Justice

Applicants’ application for declaration that respondent has duty to defend and indemnify, granted.
June 11, 2015
Court of Appeal for Ontario

C59887, 2015 ONCA 424
Respondent’s appeal, allowed; application judge’s decision set aside; declaration respondent does not have a duty to defend or indemnify the applicants.