As a result of an alleged brain injury sustained during a
sparring match with a martial arts instructor, the plaintiff in the
underlying action commenced proceedings against the instructor as
well as the martial arts clubs involved in arranging the match.
Both clubs tendered the claim to their insurer and sought a
The insurer (who was the same for both defendant clubs) denied
coverage on the basis of the following exclusion:
Any bodily injury
caused or contributed by any Insured to a participant and/or caused
or contributed by any participant in a match or practice in regards
to Category 4 Sports unless specified in the Declarations.
While "martial arts" was listed in the policy as a
Category 4 Sport, "martial arts" was also specified in
The insurer argued that the phrase "unless specified in the
Declarations" applied – unambiguously –to
"match or practice" and not to "Category 4
Sports". The insurer was arguing that in order to benefit from
the exception to the exclusion, the actual "match or
practice" where the plaintiff had been injured would have to
have been specified in the Declarations. The insurer took the
position that to read the phrase to apply to "Category 4
Sports" was to render the exclusion clause meaningless.
The Court of Appeal confirmed that the exclusion was ambiguous
and that such ambiguity was to be resolved contra
proferentum – in favour of the insured.
The Court expressly disagreed with the insurer's argument
that such an interpretation rendered the exclusion meaningless; it
simply rendered the exclusion inapplicable. A result expressly
contemplated by the language of the exclusion.
This case provides a helpful re-articulation of the principles
of contractual interpretation in the context of insurance policies.
Those involved in drafting policy language should be ever mindful
that an insured is entitled to the benefit of any ambiguity where
such an interpretation is supportable by the text of the policy and
the reasonable expectations of the parties.
1. Tien Lung Taekwon-Do Club v Lloyd's
Underwriters, 2015 ABCA 46
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