A 2020 decision of Roger, J. dismissed a summary judgment motion by an insurer based on its reliance on an exclusion in a homeowner’s policy. Both parties agreed that the exclusion clause was unambiguous; possibly this was a strategic admission. The insurer could not credibly take any other position.
The parties disagreed on the what the so-called unambiguous exclusion clause meant. The exclusion clause read:
We do not insure loss or damages… [19.] caused by water unless loss or damage resulted from… [(b)] the sudden and accidental escape of water or steam from within a plumbing, heating, sprinkler or air conditioning system or domestic water container, which is located inside your dwelling … but we do not insure loss or damage [viii.] occurring while the building is under construction, vacant, or unoccupied, even if we have given permission. [Emphasis added by the Court of Appeal.]
As is all too common in insurance policies, a key term was not defined in this contract of adhesion. In this case “under construction” was not defined.
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