Indemnity Insurance Co. of North America v. Excel Cleaning Service

Indemnity Insurance Co. of North America v. Excel Cleaning Service

Majority held exclusion (g) did not apply: on‑location cleaning created only an operational responsibility to perform the work while the owner retained proprietary dominion; temporary execution of the service did not constitute "care, custody or control" in the proprietary sense contemplated by the exclusion, and ambiguities in exclusion language are construed in favour of the insured, therefore insurer liable under Coverage B.

Citation
[1954] SCR 169
Parties
Appellant (insurer): Indemnity Insurance Company of North America; Respondent (insured): Excel Cleaning Service
Court
Supreme Court of Canada
Jurisdiction
Canada
Judgment Date
12 April 1954
Procedural Posture
Civil Appeal Insurance Contract / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario (final Hearing and Judgment)
Outcome
Appeal dismissed; insurer held liable to indemnify the insured under Coverage B (majority)
Legal Topics
Exclusion Clauses, Care Custody and Control, Contractors Liability Policy, On‑location Services, Interpretation of Insurance Contracts
Source Language
English
Insurance Contract Law Tort Property Exclusion Clauses Care Custody and Control Contractors Liability Policy On‑location Services +1 more

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Parties

Indemnity Insurance Company of North America

Appellant (insurer)

Excel Cleaning Service

Respondent (insured)

Procedural Posture

Civil Appeal Insurance Contract / Supreme Court of Canada on Appeal From the Court of Appeal for Ontario (final Hearing and Judgment)

Legal Issues

  1. 1 Whether exclusion (g) for property "owned, rented, occupied or used by or in the care, custody or control of the insured" excludes coverage for damage to a rug being cleaned at the owner’s premises
  2. 2 Whether on‑location cleaning created care, custody or control of the rug in a proprietary sense
  3. 3 Whether ambiguity in exclusion clauses must be construed against the insurer

Ratio Decidendi

Majority held exclusion (g) did not apply: on‑location cleaning created only an operational responsibility to perform the work while the owner retained proprietary dominion; temporary execution of the service did not constitute "care, custody or control" in the proprietary sense contemplated by the exclusion, and ambiguities in exclusion language are construed in favour of the insured, therefore insurer liable under Coverage B.

Court Disposition

Appeal dismissed; insurer held liable to indemnify the insured under Coverage B (majority)

Orders

  • Appeal dismissed with costs