Insurance law – Commercial general liability insurance – Pleadings – Underlying action – Duty to defend – Coverage – Property damage – Occurrence – Accident – definition – Defective workmanship
Selk Ventures Corp. v. Canadian Northern Shield Insurance Co.,  B.C.J. No. 1173, 2015 BCSC 964, British Columbia Supreme Court, June 5, 2015, T.M. McEwan J.
The insured submitted for summary trial the issue of whether the insurer had a duty to defend it in an action brought against it by the plaintiff in another action. That action concerned the alleged failure of trusses manufactured by the insured.
The claim arose as a result of a collapse of a roof at a lodge in a remote ski resort.
The Court concluded that on the allegations in the underlying claim, there was a possibility that the defects alleged might be construed as “accidental” in the sense that the damage was neither expected nor intended and that the allegation of defective workmanship in the pleadings could be construed as an occurrence that was accidental. Given the observations in Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada 2010 SCC 33 (S.C.C.) that “property damage” could be construed to be the defects alleged in the design and manufacture of the trusses during the policy period, even if serious consequences came later, the question of the timing of the occurrence remained open. Accordingly, the Court found that the pleadings gave rise to a possibility of coverage and held that the insurer had a duty to defend the insured in the underlying claim.
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