In AIG Insurance Company v Lloyd's Underwriters,1 the Superior Court provides guidance with respect to the exclusion for "expected or intended" injuries. The Court also provides some commentary on what constitutes an "occurrence".
Background
The Forget family bought land in Timmins and subsequently built a house on it, moving in during late 2013. Prior to construction, drainage issues were identified and discussed in a pre-construction soil report. Starting in 2016, the slope on the adjoining property began to fail. Progressive erosion eventually began to affect the Forgets' property, with the City of Timmins issuing an Order prohibiting occupancy of the home in 2019. The Forgets sued several parties for the damage to their property, including the City of Timmins.
Timmins was insured under two functionally identical policies for the years at issue, with AIG on risk for 2016 and 2017, and Lloyd's on risk for 2018 and 2019. AIG acknowledged its duty to defend, but Lloyds denied such a duty. AIG applied for equitable contribution for defence costs.
Lloyds based its denial on two arguments. First, Lloyd's argued that the damage was not caused by an "occurrence" as would be required to engage coverage. In the alternative, Lloyd's sought to deny coverage on the basis of an exclusion in the policy for "expected or intended" property damage.
The Level of Knowledge Required to Engage the Exclusion or Crystallize a Loss
Key to Lloyd's case was a geotechnical engineering report that...
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