The May 11, 2015 decision of the B.C. Supreme Court in
CNS v. Intact, 2015 BCSC 767 confirmed
that a duty to defend is not triggered when an insured's
negligent acts or omissions during a policy period cause damage or
an injury after
the policy has expired.
The insured homeowners lived in a house at the top of a steep
slope from 1958 to 2004. During that time they made a number of
alterations to the property that caused the slope below the home to
become unstable and part of that time they were insured by an
Intact homeowner policy.
In 2004, the insureds sold the home, moved and became insured by
a new CNS personal policy.
In 2005 a landslide originated at the insureds' former
property and as a result there was damage caused to a home at the
bottom of the slope.
Law suits were commenced against the insureds for causing the
landslide and CNS defended them but Intact declined to participate
in the defence. CNS claimed equitable restitution or contribution
from Intact and CNS's claim depended on the court finding that
Intact had a duty to defend the insureds.
The issue was whether the common words "accident" and
"occurrence" in the Intact policy required that some
resulting damage occur during the policy period for a duty to
defend to be triggered. The court concluded that there was no
reasonable expectation that Intact would be obliged to defend the
insureds for damage incurred after the Intact policy had expired
and CNS's claim against Intact was dismissed in what might be
described as a landslide victory for Intact.
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