A person who maintains an aircraft in exchange for flying time is an insured person under the plane's insurance policy
The Plaintiff was partially successful in his action against his insurance company , British Aviation, in being found a "person insured" pursuant to a clause in the policy, thus triggering the duty to defend. The Plaintiff was awarded costs in the action but the insurer was free to retain counsel of their choice to represent the Plaintiff.
Zaporzan v. British Aviation Insurance Group (Canada) Ltd. [2008] M.J. No. 267 Manitoba Court of Queen's Bench J.J. Oliphant, A.C.J.Q.B. July 8, 2008
A small commercial aircraft crashed near Winnipeg killing the pilot and three passengers. The estates of the deceased passengers commenced an action against the estate of the deceased pilot, the owners of the aircraft, and Zaporzan, who was responsible for the maintenance of the aircraft. The aircraft owners and the estate of the deceased pilot cross-claimed against Zaporzan alleging negligence.
British Aviation defended the owners, as well as the estate of the pilot, but refused to defend Zaporzan either as a named defendant, or in relation to the cross claims.
Under the policy, both the pilot and the owners were named insureds. Clause 20 of the policy, entitled "Persons Insured", extends coverage to persons that provide maintenance on the aircraft under the permission of the owners. This coverage did not extend to parties who were in the business of repairing or maintaining aircraft. At all material times, Zaporzan was a certified aircraft maintenance engineer, but was not working in that capacity. He worked for the government of Manitoba as a quality assurance manager and training coordinator. Zaporzan and the owners entered into a barter agreement where Zaporzan would maintain the aircrafts in exchange for flying time. British Aviation argued this relationship meant Zaporzan was in the business of maintaining and repairing aircraft. The court rejected this in part because "business" was not a defined term in the policy.
Since Zaporzan then fell under the definition of persons insured pursuant to clause 20 of the policy, the allegation of negligence, which falls within the scope of the policy issued by British Aviation, triggered its duty to defend Zaporzan. The court held British Aviation was free to retain counsel of its choice for Zaporzan.
This case was originally summarized by nmacdonald@harpergrey.com and originally edited by dpilley@harpergrey.com
