Snow v. Royal & Sun Alliance Insurance Company

Snow v. Royal & Sun Alliance Insurance Company Court Supreme Court Date 2015-01-13 Citation 2015 NSSC 44 Docket Syd 377957 Judge/Registrar/Adjudicator Murray, Patrick J. (Honourable Justice) Document Type Decision Relations Library Sheet - Snow v. Royal & Sun Alliance Insurance Company - 2015 NSSC 44 - 2015-01-13 - Library Sheet See also - Royal & Sun Alliance Insurance Company of Canada v. Snow - 2016 NSCA 7 - 2016-02-11 - Decision Decision Content SUPREME COURT OF Nova Scotia Citation: Snow v. Royal & Sun Alliance Insurance Company, 2015 NSSC 44 Date: 20150113 Docket: Sydney, No. 377957 Registry: Sydney Between: Fred Snow, Charlene Snow and Sandy Snow Plaintiffs v. Royal & Sun Alliance Insurance Company of Canada Defendant Judge: The Honourable Justice Patrick J. Murray Heard: August 7h 2014, in Sydney, Nova Scotia Written Decision: January 13, 2015 Counsel: Harvey MacPhee Q.C. for the Plaintiffs Christine Nault, for the Defendant By the Court: Introduction [1] Mr. and Mrs. Snow own a residence at 60 Dominion Street, Glace Bay, Nova Scotia, which consists of half a company house. [2] Their neighbour, Mr. Yates, owns the other half of the house. His address is 62 Dominion Street. Facing the house from Dominion Street the Snows are on the right, and Mr. Yates would be on the left. [3] Mr. and Mrs. Snow claim that in 2011, the oil tank on Mr. Yates property spilled onto their property, and leaked into the soil under their house at 60 Dominion Street. [4] Subsequent to the oil spill the property experienced two fires, and was ultimately torn down. Mr. and Mrs. Snow claim they are unable to rebuild without remediating the soil under their residence. At the time of the spill the Plaintiff’s son Sandy Snow was living on the property. [5] The Defendants have made a claim under their own insurance policy, with the Defendant, Royal & Sun Alliance Insurance Company of Canada, (RSA), seeking that the damages incurred by them be covered by the house insurance policy. The policy included coverage for “escape of fuel oil”. [6] The insurer has denied the claim on the basis that the policy does not extend coverage to the soil, only to the dwelling which rested upon it. According to the Defendant RSA, the policy wording expressly states it is the dwelling that is insured and that the dwelling does not include the soil underneath it. [7] The parties agree that for the purpose of this motion it is not necessary for the court to determine whether in fact, the soil is contaminated. Background [8] The semi-detached residential home of the Plaintiffs is half of a duplex. It does not contain a full basement but is supported by a concrete frost wall. It does not contain a “full” or completed basement. Instead underneath the main floor there is a “crawl space” with a dirt floor. The plumbing for the house is located in the crawl space. There is some evidence that this space was accessed to repair the plumbing and used for storage. The crawl space is accessed through a small door located under the stairwell, above the main floor inside the dwelling. (Photo in Exhibit #1) [9] As owners of the property Fred and Charlene Snow purchased a homeowners policy with the Defendant, RSA. The policy was a called “Comprehensive Homeshield Policy”. They maintain that it provided “all risks” coverage. [10] The oil spill on the neighbouring property occurred on or about February 11, 2011. As stated the oil tank was located at the home of the Plaintiffs neighbour, Mr. Yates. The Snow property was further damaged by fire two (2) weeks later, on February 25, 2011. Following that Mr. Yates tore down his half of the duplex and excavated the soil on his property at 62 Dominion Street. [11] Following the oil spill, RSA hired a disaster clean up company to assist in the cleanup of certain damage caused by the spill, including the removal and repair of contents of the Plaintiffs home. As well, additional living expenses were paid for by RSA due to the smell of fuel oil in the house. As a result, the Plaintiff, Sandy Snow was reimbursed for travel and accommodation expenses. [12] Mr. and Mrs. Snow have had extensive dealings with the Cape Breton Regional Municipality (CBRM). The CBRM inspected the property. I will not go into detail about this except to say that the CBRM first ordered the property to be demolished. Subsequent to that, the CBRM ordered the Snows to confirm the structural integrity and the extent of soil contamination. The Snows were later informed they would be unable to obtain a permit to rebuild until any fuel oil contamination was remediated. At that point, the Plaintiffs could not remediate the soil without tearing down their half of the duplex. [13] When the property was further damaged by a second fire, it was demolished and removed by order of the CBRM. [14] The Defendant, RSA, has denied that it is liable to the Plaintiff’s for the costs of remediating the soil and other related costs. No remediation of the soil has taken place. [15] This motion is to determine a coverage issue. As such, the wording of the policy, the nature of the space below the home, the use which was made of that space, and the type of foundation are the relevant facts. [16] Mr. and Mrs. Snow’s policy covered the location at 3Middle Street, Donkin, Nova Scotia where they resided and the location at 60 Dominion Street, Glace Bay, Nova Scotia where their son resided. The former address contained a fuel oil tank and the latter address contained a propane tank. Issue [17] Does the insurance policy in question provide coverage for the remediation of the soil under the home of the Plaintiff’s Fred and Charlene Snow, located at 60 Dominion Street, Glace Bay, Nova Scotia? [18] RSA and the Plaintiffs have agreed this is an appropriate case for a Rule 12. Both parties agree this Court has jurisdiction to rule on the motion. Rule 12 is attached to this decision as Appendix “A”. Position of the Parties Mr. and Mrs. Snow [19] Mr. and Mrs. Snow maintain the court has jurisdiction to decide this question of law, under the Civil Procedure Rules. Rule 12 permits the court to provide an answer on a strict narrow ground. In this case that ground is the interpretation of the insurance policy in answer to the question: What does the policy cover with respect to damages incidental to the oil spill that occurred as they allege, to their property at 60 Dominion Street, Glace Bay, Nova Scotia? [20] The contention of the Plaintiffs’ is that the policy is “comprehensive” and included coverage for this damage, as confirmed by the “all risks” nature of the policy. This can be taken from the plain ordinary wording used to describe the policy and the risks that are covered by the policy. [21] Specifically, Mr. and Mrs. Snow state they contracted for the specific risk of damage or injury caused by the “escape of fuel oil”. The oil tank was located very close to their property line, and this was a concern they had. [22] The Plaintiffs say they were concerned that a fuel leak or spill would come onto their land. As it turned out, that very risk materialized. They submit that the escape interfered with their ability to use the building for its intended purpose as a residential dwelling. Thus, remediation should be covered under the policy. [23] The Plaintiffs state there is an ambiguity in the policy. This is clear, they argue from a number of aspects. First, the civic address, shown on the Coverage Summary is 60 Dominion Street which includes their entire property. [24] Second, when the entire circumstances are considered, this was intended to be comprehensive coverage, covering all risks, unless specifically excluded. There was no exclusion for remediation of soil, even though it would have been easy for the insurer to stipulate that soil was excluded. [25] Thirdly, there is the intention of the parties to include the specific peril – escape of fuel oil provision. The policy does not limit or exclude, loss or damage to soil, but instead adds it by including it as a specific peril. [26] In summary, the Plaintiffs’ ask; where else could the fuel oil have escaped but into the ground? The insureds submit it was reasonable for them to expect they would be covered for this peril. This is the only interpretation which accords with the practical realities, for them to re-occupy the house. [27] Mr. and Mrs. Snow therefore maintain that whatever coverage is necessary for them to return to the home, to re-inhabit the house, should be compensated. Otherwise they submit the purpose of the escape of fuel oil provision is defeated. The Position of the Defendant Insurer – RSA [28] The Defendant insurer states it is common not to insure contamination on a “first party basis”. Secondly, it is the insured’s, Mr. & Mrs. Snow, who bear the onus of proving coverage under the policy. [29] RSA states there are few facts that need to be determined in order this Court to address the coverage issue. Those are: 1) the wording of the policy; 2) the nature of the space below the home at 60 Dominion Street, (and the use to which space was put); and 3) the type of foundation. [30] As stated RSA submits it is not necessary to determine, if in fact the soil is contaminated. [31] RSA submits the policy terms contain four specific coverage as follows: 1) Coverage A – Dwelling Building; 2) Coverage B – Additional Buildings; 3) Coverage C – Personal Property and 4) Coverage D – Loss of your Dwelling. [32] Only Coverages A and B are applicable here, submits RSA. In a nutshell, RSA submits it is “crystal clear” that the only coverage Mr. and Mrs. Snow have is for the dwelling, and attached structures, not the soil. There is coverage for additional buildings that are detached from the dwelling. [33] RSA states the plain ordinary meaning of “building”, does not include the soil underneath it. If the policy was meant to cover soil, it would say so, argues the Defendant. It does not and the definition of dwelling cannot be expanded to include the soil. The soil is included under the term “premises”, which under the policy has its own separate meaning. It would be improper to ascribe a different meaning to these terms. [34] Further, RSA argues there is no ambiguity, regarding what property is covered under the policy. It submits that the rules used to interpret insurance policies cannot be used to “create” an ambiguity, where none exists. [35] RSA argues that this Court must give effect to the policy terms which exist to limit and define coverage. If the soil is not part of the dwelling, then the requirement to remediate the soil before rebuilding, does not create coverage where none existed. Analysis [36] At the heart of this matter is whether coverage is limited to the “dwelling and attached structures”. The policy defines “dwelling” as the “building described in the Coverage Summary wholly or partially occupied by you as a private dwelling”. [37] Applying the issue to the facts before me, whether or not an unfinished basement containing a dirt floor is included under the Policy’s definition of “dwelling” is a relevant consideration. The Policy Wording Introductory Paragraphs [38] At the outset, it is useful to consider the name of the policy. It is described as a “Comprehensive Homeshield” policy. While the name itself is not determinative, the Plaintiff argues that a reasonable insured would understand this to be “all inclusive” coverage. The word “shield” itself, may suggest that the entire home is “covered” or “protected” or “shielded”. Considerably more attention must be paid however to the entire policy. [39] The parties acknowledge the policy, being a contract, must be read as a whole, so as to ascertain its meaning. [40] To that end, the policy starts with instructions on “HOW TO READ YOUR POLICY”. It explains that the policy consists of three sections: I) Property Coverages; II) Liability Coverages; and III) Conditions. Section I – Property Coverages [41] The policy states that Section 1 “describes the insurance on your dwelling”. The word “dwelling” is in bold print. On the same page is the message “Important” and below it states: Words and phrases in bold have special meaning as defined under the “Definitions”. [42] Further under the next paragraph the policy states: This policy contains various exclusions and limitations which eliminate or restrict coverage. These have been clearly identified. Please read this policy carefully. [43] I note here that the Defendant, RSA is not relying on an exclusion. If it was, RSA would need to establish that the risk was excluded under the policy. The Defendant is however submits, that “dwelling” is limited by its definition. [44] Under the heading “Agreement” the policy states on page 4: The Coverage Summary that forms part of this policy summarizes the coverages and amounts of insurance we have agreed to provide and the period from which they are provided. [45] The “Property Coverages” in “Section I”, contains the “Definitions” on page 4. In the definitions, “dwelling” is described as follows: Dwelling means the building described on the Coverage Summary, wholly or partially occupied by you as a private residence. [46] The term “Insured Peril” is described as follows: Insured Peril means a cause of loss or damage insured under the coverage form stated on the Coverage Summary. [47] The policy also contains a definition for “Premises” as follows: Premises means the land and building(s) contained within the lot lines on which the dwelling is situated. [48] I note that the definition of “Premises” refers to the land and building(s) contained “within the lot lines on which the dwelling is situated”. Premises therefore includes all the land and buildings on which the dwelling is located. Coverage A – Dwelling Building [49] Turning next to consider the wording under the Coverages, “Coverage A” is described as “Dwelling Building”. The policy states: We Insure: - the dwelling and attached structures. - outdoor domestic water containers located on the premises, including swimming pools, hot tubs, saunas and attached equipment. - materials supplied and located on or adjoined to the premises. Coverage B – Additional Buildings [50] Under Coverage B, - Additional Buildings, only buildings which are detached from the “dwelling” are covered. The policy states: Coverage B – Additional Buildings We insure private buildings or structures detached from the dwelling which are on your premises , but not insured under “Coverage A”. [51] The policy further explains what is meant by “detached”. It cites the following example, “connected by only a fence, utility line, etc.” [52] From this wording in the policy it appears that the soil under building(s) which are detached from the dwelling are insured but not the soil under the dwelling itself. This is because of the definition of “premises”. [53] Under the policy wording, one can see that in some instances only “premises” is covered and in other instances only the dwelling and attached structures are covered. As earlier stated there is the distinction between the “dwelling building” and “additional buildings”, in so far as what is insured, as between Coverage A and Coverage B. [54] At this point it should be mentioned that that the policy contains no definition for what is meant by “building”, nor does it define “structures”. [55] According to the evidence, the building at 60 Dominion Street is supported by a concrete “frost wall” type foundation. This is shown in Exhibit #1. Located under the stairwell inside the house was the door to the dirt crawlspace located under the house. This can also be seen in Exhibit #1. [56] The lack of a definition for “building” and “structures”, is an important aspect, in interpreting the policy. This is especially true if the term “building” is capable of more than one meaning. [57] As far as “structures” is concerned, an attached foundation, would appear to be a structure, given its plain ordinary meaning. The words structure and foundation are often used hand in hand. [58] It is important not to “assume” certain meanings, as much can turn on the meaning ascribed to these terms. [59] The Defendant it its brief, provided a dictionary meaning for the word “building”. At page 4 of its brief the defendant provided the following definition: “ a structure with a roof and walls, such as a house or a factory”. – Oxford Dictionary. “a usually roofed and walled structure built for permanent use (as for a dwelling). – Webster”s Dictionary. Coverage C – Personal Property [60] Under Coverage C – The policy provides that personal property “on your premises” is covered. This includes the “contents of your dwelling” and “other personal property on your premises”. [61] The policy continues for several pages to describe the coverages for personal property in Coverage C and Coverage D “Loss of use of your Dwelling”. Coverage D – Loss Of Use Of Your Dwelling [62] Notably in Coverage D, under the heading “Additional Living Expenses”, the policy states on page 8: If, as a result of damage by an insured peril, your dwelling is unfit for occupancy or you have to move out while repairs are being made, we insure any necessary increase in living expenses, including moving expenses incurred by you so that your household can maintain its normal standard of living. Payment shall be for the reasonable time required to repair or rebuild your dwelling or, if you permanently relocate, the reasonable time required for your household to settle elsewhere. (Emphasis) [63] Once again, this gives rise to what is meant by “repair or rebuild your dwelling…” The direction to “Read your Policy” suggests it can be readily understood by an ordinary person or a reasonable insured who purchased the policy. [64] According to the Defendant insurer, it is clear that “repair or rebuild” applies to the dwelling only and not the soil, even if the soil requires remediation, before the dwelling can be rebuilt. Insured Perils [65] Following the sections on “Coverages”, the policy describes further the perils that are insured, as follows: Insured Perils You are insured against all risks of direct physical loss or damage, subject to the exclusions and conditions of this policy. (Emphasis) Exclusions [66] The “Exclusions” under the policy are contained in Section II at page 28. None of these include damage to the soil or damage from escape of fuel oil. Conditions [67] The Conditions under the policy are found in Section III at page 29. It states and then lists the “conditions applicable to the various coverages provided herein”. None of the conditions pertain to damage to the soil or to damage from escape of fuel oil. Loss or Damage not Insured [68] Directly under the heading “Insured Perils” on page 13 of the policy, is a list of things not insured. These are not entitled exclusions but are described as “Loss or Damage not Insured”. The policy states simply, “We do not insure loss or damage:” and then lists those things. In effect they are exclusions, even though they are not called “Exclusions” in the policy. There are no exclusions entitled Exclusions in the Property Coverages in Section I. [69] There are a total 73 items listed as “not insured” on pages 13, 14, and 15, of the policy. None of these pertain to or cover the loss or damage at issue in this case. Specified Perils [70] Immediately following “Insured Perils” and “Loss or Damage not Insured”, but still under Section 1 – Property Coverages is a smaller heading entitled “Specified Perils”. [71] Without any explanation or “pre-amble” that there are specified perils which are insured, the language in the policy states as follows: Subject to the exclusions and conditions in this policy, Specified Peril means” - Fire, - Lightening, - Explosion. [72] It then lists numerous other perils including: Escape of fuel oil, meaning the bursting or overflowing of a domestic fixed fuel tank, apparatus or pipes. Basis of Claim Settlement [73] From there the policy’s next heading is, “Basis of Claim Settlement”. One can only assume that because specified perils are listed and described; that they are insured and that there is coverage for them. This is of course subject to the exclusions and conditions in the policy. [74] As stated there are “Exclusions” in Section II and “Conditions” in Section III, but there are also “Loss or Damage not Insured” in Section I. The “Specified Perils” are contained in Section I, but not as a loss or damage not insured. [75] The Plaintiffs and Defendant essentially agree that he “Specified Perils”, are risks identified and covered under the policy. The Defendant, RSA in its submission explains this as the “what” and the “why”. The “dwelling”, strictly as defined being the “what” and the “why” being the “escape of fuel oil”. [76] Under the Basis of Claim Settlement previously mentioned , I note the Policy states: We will pay for loss or damage up to your financial interest in the property, but not more than the applicable amount (s) of insurance for any loss or damage arising out of one occurrence. (Emphasis) [77] The above statement is contained below the heading ,“When Coverage Applies”, so the policy refers to the insured’s financial interest in the “property”. This presumably means the property which is insured. For example, the dwelling and structures. As stated previously, although it is not separately defined, the term “property” is being used interchangeably with “what” is being insured. By Laws [78] There are further provisions in the policy relevant to the circumstances here, such as the “By Laws” provision which states on page 17: …we will pay up to $20,000 in all for - The cost of demolition and removal of any undamaged portion of the dwelling, building or additional buildings/structures. - The increase in the cost of construction or repair of the dwelling building or additional building(s). [79] This wording is a further example of what RSA argues is insured, namely “the dwelling building, additional buildings, and structures”. It must be recognized however that the policy also states that: “The Coverage Summary…summarizes the coverages and the amounts of insurance we have agreed to provide ..”. Coverage Summary Form [80] A review of the Coverage Summary Form (the form) shows only the Dwelling Building as “A” under items insured. It mentions nothing there about structures or use as a private residence, the latter wording of which is included in the policy definition. [81] The form states on page one that “listed below are the coverages and premiums for property at this location…” The location is 60 Dominion Street, Glace Bay, NS B1A 3M9. [82] The form states further, “ For a more detailed explanation of terms, conditions and exclusions read Sections I, II and III in the policy booklet ”. [83] The form therefore, refers the reader back to the policy itself. The coverage summary mentions nothing about the escape of fuel oil, even though the policy states that the Coverage Summary summarizes the coverages and the amounts of insurance the insured agreed to provide. Nature of Insurance Contracts [84] At issue is whether the insurer’s liability extends to a specified peril. This requires a consideration of the nature of insurance contracts. As with all contracts, an insurance policy is to be construed in light of the surrounding circumstances. (see Stuart and Stuart Trust v. Royal and Sun Alliance Insurance Company of Canada, 2004 NSSC 58, at para. 41) [85] The primary interpretative principle is that when the language of the policy is unambiguous, the court should give effect to clear language, reading the contract as a whole. In addition, the proper consideration of an insurance contract is a question of law. (Turpin v. Manufacturers Life Insurance Company, 2011 BCSC 1162, at paras. 22, and 23) [86] I have read and considered all of the cases provided to me by Counsel in this matter. They are all relevant, in one sense or another. I shall refer to several which I have found to be instructive on the question before me. [87] In the case of Thorburn Wharf Fisheries Ltd. v. ING Insurance Co., 2010 NSSC 181, Justice John D. Murphy had to interpret an exclusion clause, specifically whether the meaning of “waterborne object”, included a vessel. In finding that the term was effective to include vessels, he stated in his reasons: (1) The intention which I glean from the policy… and that is an effective approach; 2) I am just not convinced that there is any ambiguity or limitation in the words… that requires me to apply any limiting principles such as contra proferentum or any other principle. [88] In conclusion, Justice Murphy found that the term “waterborne object” was as broad as it could be. [89] Similarly in Stuart, Justice Michael MacDonald (as he then was) dealt with a case similar to the present, in that it involved an oil spill and a “Select Homeshield Policy”. As was the case here, the issue was whether the coverage included more than just the building. At paragraph 44 the court found that more than the building was covered under the policy: [44] Turning to the alleged exclusion for deterioration, rust, corrosion, or contamination I note at the outset, that at page 4 “damage caused by bursting… of your… fuel tank” is covered. In this part of the policy at least, there is no specific exclusion for deterioration, rust, corrosion, or contamination. In this regard, I accept Plaintiffs counsel’s submission that if any such exclusion did exist, applying the Simcoe and Erie, (supra) principles, only the actual thing deteriorated, etc. would be excluded i.e. the old worthless oil tank. I find, therefore, that this loss was a covered peril. [90] In Stuart the court also dealt with the issue of whether there was an exclusion for contamination. Justice MacDonald found at paragraph 44 above that: In this part of the policy, at least, there is no specific exclusion for… deterioration, rust, corrosion or contamination. [91] The court stated that even if there had been an exclusion, the principles in Simcoe & Erie General Insurance Co. v. Reid Crowther & Partners Ltd., [1993] 1 S.C.R. 252, would apply. In paragraph 41 of the Stuart decision MacDonald, J. set out those principles: [41] In considering these submissions, I am guided by some common law principles of interpretation involving insurance contracts. They support a finding of coverage in the face of ambiguities. The leading case on point is Simcoe & Erie General Insurance Co. v. Reid Crowther & Partners Ltd., [1993] 1 S.C.R. 252. Beginning at page 268, McLachlin, J. (as she then was) explained: In each case, the courts must examine the provisions of the particular policy at issue (and the surrounding circumstances) to determine if the events in question fall within the terms of coverage of that particular policy. This is not to say that there are no principles governing this type of analysis. Far from it. In each case, the courts must interpret the provisions of the policy at issue in light of general principles of interpretation of insurance policies, including but not limited to: (1)The contra proferentum rule; (2)The principle that coverage provisions should be construed broadly and exclusion clauses narrowly; and (3)The desirability, at least where the policy is ambiguous, of giving effect to the reasonable expectations of the parties. [Emphasis] [92] The Defendant submits the wording of the policy in Stuart was different than the wording on the present policy. This is true. I accept that the interpretation of the provisions of one policy, although helpful, may not lead to an analogous interpretation of another policy. [93] The principles do however remain the same. I am guided by them in the present case. [94] In the policy before me there is the definition of “dwelling”. The Defendant says the term “building” contained within that definition, ought to be interpreted narrowly. Because these are terms that have the potential to extend coverage, there is an argument that these terms ought to be interpreted broadly. [95] The Defendant submits it is common that insurers do not insure soil contamination claims, on a “first party” basis. As authority, the Defendant cited Cole v. Aviva Ins. Co. of Canada, 2010 NLTD 80. In Cole there was an oil spill within the boundaries of the property for which the plaintiff sought compensation. The policy contained an exclusion for “damage to property” which she owned or occupied. [96] The plaintiff argued there was “injury to property” which was not excluded. The court in Cole denied coverage, stating the plaintiff was attempting to stretch the wording of the policy to extreme lengths, in an attempt to overcome what was perceived as a deficiency in the policy. Another argument presented but also denied was that “property damage” was different than “damage to property”. [97] Thus the wording of the policy can make a difference in coverage being allowed (Stuart) or in coverage being refused (Cole). [98] One of the difficulties is deciding when to apply the rules of construction. While an ambiguity cannot be created where none exists, an omission in the policy can result in an ambiguity. This is also the case if the coverage provisions do not make sense or “fit together”. [99] In terms of application of the interpretation rules, the case of Turpin, is instructive. Where the language of the policy is ambiguous, courts rely on general rules of construction, which include the following: i. Courts should prefer interpretations that are consistent with the expectation of the parties, as long as it can be supported by the policy. ii. Courts should avoid an unrealistic result or one that would not have been contemplated at the time of the policy. iii. Courts should attempt to construe similar policies consistently and make sure rules are used to resolve and not create an ambiguity. iv. Commonly the doctrine of contra preferendum is used to resolve an ambiguity, by construing the policy against the insurer. v. Courts should attempt to resolve an ambiguity by interpreting coverage provisions broadly and exclusions provisions narrowly. [100] In the part of this policy dealing with the escape of fuel oil provision, there is no exclusion. This is similar to the finding in Stuart (see paragraph 44). [101] The insured argues this is a direct foreseeable loss. It was not remote. When Mr. and Mrs. Snow purchased the fuel oil escape coverage, it was an event that it could happen. It did in fact happen. What they feared came true. [102] The issue arises because the fuel oil leaked into the ground under the house. It was a foreseeable consequence, if not the only foreseeable consequence. It was, among others, the reason they purchased the all risks coverage. It was, argue the Plaintiffs, not beyond belief that this would happen. It is of no consequence that that they received limited coverage for personal property. They needed the coverage for all the damages flowing from the loss. [103] There is little question that if the risk is to be restricted to personal property, then such restriction, qualification, limitation of the specifically identified peril, ought to be clearly explained or contained in the policy. [104] It is not sufficient that the insured be left to their “own devices”. In interpreting this policy, what is meant by “dwelling”, what is meant by “building”, what is meant by “structure(s)”, what is meant by “wholly or partially occupied by you as a private residence”, are all terms which are relevant to the coverage issue. [105] A court should ask, is there such clarity in the policy so as to conclude that the damage is not covered or would not be covered? [106] I have considered the recent case of Garden View Restaurant Limited v. Portage LaPrairie Mutual Insurance Company, 2014 NSSC 447, submitted by the Defendant. In that case Justice Stewart found that the term “building” as defined in the policy, did not include the soil. She interpreted the policy to state that the types of items insured related to assets other than soil. [107] Justice Stewart in Garden View referred to further cases, where a similar conclusion was reached. She referred to Grey & Bruce Mutual Insurance Co. v. MacKinnon Plumbing & Heating, , [2009] O.J. No. 60, which had an identical definition of “building”. That definition mentions nothing about the building being occupied as a private residence. The definition of dwelling in the policy under consideration, does contain such language . [108] A third case mentioned was M. J. O’Brien Ltd. v. Freedman, 1923 O.J. No. 60. This case is of limited assistance on the facts as it involved a contract for the sale of buildings. The court held that the word “buildings” in the contract included the foundations. At paragraph 15 the court suggested that a foundation of solid rock or of earth would be the natural foundation, and that all that was erected upon that foundation would be the building, including the artificial foundation. [109] Interestingly and relevant for the purpose of the issue before me, the court in O’Brien stated as follows in regard to contracts of insurance: Decisions based on contracts of insurance are of little help, as so much depends on the context. [110] The last case referred to was J.M.D.S. Services Inc. v. Prudential Assurance Co. of England Property and Casualty (Canada), (1997), 44 C.C.L.I. (2d) 223, in which the court concluded that the word “structure” did not include “the golf course, or trees, shrubs, flowers or plants growing thereon”. What is important to be taken from the case is the court’s view on what would constitute a “structure”, a term which was not defined. [111] The court stated at paragraph 7 that “absent an assigned meaning, within the context of the insurance policy”, the word structure “should receive its ordinary popular meaning of being an edifice or building of some kind, built or constructed on, above, or below the surface of the land.” [112] Justice Stewart, in her decision, as did the Courts in the other cases referred to, was careful to provide the proper context, in interpreting the policy before her. I wish to do the same in respect of the policy before me. [113] Unlike Garden View there is no definition of “building” in the Snow’s policy. Unlike Garden View there is in the Snow’s policy a provision that covers “Escape of Fuel Oil.” Unlike Garden View there is a further provision in the policy before me that covers “all risks”. [114] From where and to where must the “escape” happen. The policy described this peril as meaning the “bursting or overflowing of a domestic fuel tank…” [115] There are no qualifying words which limit the escape to the main floor of the building. Applying common sense, gravity would prevent it from “escaping”, into the four walls and the roof of the building. [116] Each policy is different. Unlike the policy in Garden View, there is the clear coverage for escape of fuel oil in the present case. This leaves open the question, to what does that specified peril apply? Decision – Interpretation of policy intention. [117] In the context of this policy as I have reviewed it, the definition of “Dwelling Building” under Coverage A in the policy, incorporates “attached structures”, and also takes into account that the space within the building, will be used in whole or in part, for residential purposes. ( pages 5 and 6 of the policy) [118] To describe a dwelling as “four walls and a roof” does not allow for a basement, finished or unfinished to be included as part of the dwelling. Yet objectively, reasonable people would readily accept, that a basement is part of a dwelling or a building. Legally this is also the case. In McKenzie v. Ferguson, 1923, 3 WWR 1089 (Man. C.A.) it was stated by the court that the word “building”, means the complete structure, every part and every portion of it, roof, chimney’s, walls, floors, foundations and all other fixtures which form part of the “building”. [119] On the facts before me there is a small door located under the stairwell of the Snow residence. It is visible from the photo in Exhibit #1. This door is the access to the basement of Mr. and Mrs. Snow’s dwelling, which amounts to a dirt crawl space under the building itself. [120] The foundation of the house consists of at least two concrete walls and other posts. The Plaintiffs’ son Sandy used the crawl space to maintain and repair the plumbing under the house. There was evidence it may have been used for storage. It was used as part of the residence. [121] Further, a key fact that cannot be overlooked is that the parties agreed to coverage for escape of fuel oil. This was very specific in the policy. [122] In addition, in the policy “dwelling” is defined as “the building”. The Defendant defines” building” as a roof and four walls and submits that the analysis ends there. To end the analysis there however is contrary to the view supported by the Defendant, that the policy should be looked at as a whole. [123] I agree the policy must be considered in its entirety. In my view, this decision should not be based on a selected definition. Accordingly, the task is to attribute the appropriate meaning, within the provisions of the policy and the circumstances applicable to the parties. That is the way to properly interpret the contract and determine the intention of the parties. [124] There are many contexts in which a dwelling necessarily includes a basement of the house. Indeed to have an insurable interest in a dwelling, the insured must own the land beneath it. No one would argue that for appraisal or evaluation purposes, the foundation and the state of the foundation would not be an important factor in determining its value. [125] It is clear in property law, that land includes the building(s) appurtenant thereto. For conveyancing purposes, land and dwelling are one and the same. [126] In Cabell v. The Personal Insurance Company, 2011 ONCA 105, Justice Mark Rosenberg wisely observed that the court was in the best position to determine the obvious risk under the policy. In my view, to apply the narrow meaning to “building” suggested by the Defendant RSA, in effect nullifies the obvious risk in the present case. That risk is that oil will leak into the ground. [127] Further, to apply a restricted definition ,where there are other definitions which could be used, the language must be perfectly clear. While there is clear coverage for the risk itself (the escape of fuel oil), the meaning to be attributed to “building” is not perfectly clear. [128] It is “too fine” a distinction to simply conclude that “building” means four walls and a roof, and as such does not include the soil. Such an interpretation does not allow for the possibility that a dwelling often includes a basement. Even if a basement is unfinished, it is still a basement. Its floor my not be finished in concrete but it is still a floor. In Black’s , “building” is defined as “a structure.. enclosing a space within its walls, but not necessarily covered by a roof..” (Emphasis) [129] I find that the attached structure of the home of Mr. and Mrs. Snow included the concrete wall foundation, the posts, the plumbing fixtures, the crawl space and the dirt floor. If that floor is contaminated below the surface then coverage should follow under this policy, in my respectful view. [130] In my view to restrict the coverage as is sought by the insurer, the wording in the policy must be clear. The definition of dwelling, for the reasons I have given is not sufficiently clear to alter the clear intention of the policy, which is to provide all risks coverage and coverage for escape of fuel oil from a bursting or overflowing domestic tank, period. [131] In the result I find given the entire wording and context of the policy, the parties intention as contained therein, included coverage for damage and injury caused as a result of an oil spill or an escape of fuel oil. That coverage extends to the house at 60 Dominion St. and the soil underneath it. The structure(s) attached to the dwelling included the concrete walls, posts and plumbing fixtures. The crawl space and the unfinished dirt floor are areas enclosed within the building, and are part of that entire structure. [132] I am satisfied the Plaintiffs have brought themselves within the coverage provisions, as they were intended. As such they have met the onus upon them. Alternate Finding/Decision - Ambiguity [133] In the event I am in error as to my interpretation of the policy, I find there is an ambiguity in the policy as submitted by the Plaintiffs. There are essentially two reasons for this finding. [134] First, there is nothing in the policy which explains clearly, how the policy is intended to operate. Here I am referring to the “what” and the “why” as described by the insurer, and explained earlier in this decision. (Paragraph 75) [135] I repeat that part of the policy which reads, “Your policy describes your coverage”. Reading the policy as a whole, it would not be apparent to the objective observer that the all risks coverage, and specifically the escape of fuel oil provision, would be limited to the personal property inside the dwelling. That is not the coverage which was sought by the purchaser of this policy. The coverage sought was the repair to damage resulting from an oil spill on the insureds’ property. In this case, that was the property at 60 Dominion Street, Glace Bay. (Affidavit of Charlene Snow, at paras 39 and 40). [136] The explanation given by RSA as to how the policy works may be the best indication of an ambiguity. That explanation, that you must first look at what is insured, before looking to what it is insured against the “why”, is entirely necessary. It is not obvious from a reading of the Policy. [137] Secondly, the term “building” in my view, is capable of more than one meaning. In Words and Phrases, (2nd Ed Legal Maxims Canada) the term “building” is defined as: A building is what is “built” upon the land, and the foundation is built as much as any other portion or structure. Sometimes one speaks of building upon a foundation, with the idea that the foundation is something distinct from the building itself, but as applied to a house or factory, the foundation in this sense would be the earth itself, and all that would be erected upon it would be the building. (emphasis) [138] In Words and Phrases Judicially Defined, Butterworths Vol. 1, Cambridge 1943, it is stated at paragraph 417: The imperfection of human language renders it not only difficult, but absolutely impossible to define the word “Building” with any approach to accuracy. [139] In R. v. Obernesser, [1917] OJ No. 81, the court held that a cellar was part of a “private dwelling house”. The cellar was underneath the house and only accessible from an open stairway in the back of the house. There was no stairway inside the building that granted direct access to the cellar. The court held that despite the cellar not being accessed through the interior of the building, the intention was for the cellar to be included as part of the dwelling unit. [140] I find that the definition attributed to dwelling and building by the Defendant does not deal with the space inevitably left in the building by the enclosure, including the foundation. That space includes the soil or dirt floor underneath it. [141] This is the meaning which makes the most commercial sense. This is especially so when one considers the all risks coverage offered by the policy, and the lack of a clear explanation that coverage would be limited, severely so, by a single arbitrary definition of building, ascribed to it by the insurer. [142] I am therefore resolving any ambiguity by interpreting the term “building” broadly, so as to include damage to the house, the foundation and the space enclosed within it. This includes the soil which is enclosed by the foundation and upon which the it rests. The soil, of course, supports the foundation itself. Alternate Finding/Decision – Expectation of parties/Nullification [143] In the alternative, if I am in error as to whether an ambiguity exists I believe the nullification of coverage doctrine should apply in the present circumstances. [144] In Chilton v. Co-operators Insurance Co., 1997 CanLII 765 (O.N.C.A.), Laskin, J. A. spoke clearly and directly about when Canadian Courts would “settle” upon whether this doctrine has application without an ambiguity, necessarily existing. [145] At this point, a full consideration would not be complete without addressing whether the expectation of the parties also applies, as both are closely related, as evident by the case law. That is, without there being an ambiguity in the policy. [146] In the recent case of Turpin, the British Columbia Court of Appeal, essentially rejected the position that a broadened approach could be taken, (as in the United States jurisprudence) so as to construe coverage or find coverage, where the policy wording is otherwise unambiguous. [147] In Turpin the court discussed the Ontario decisions of Cabell and Chilton in some detail. The court stated several things about the approach taken, noting that in Cabell, Rosenberg J.A., felt there was “much to be said” about the insured’s submission that the endorsement (swimming pool) was ambiguous. [148] At paragraph 43, after referring to Consolidated Bathurst Export Ltd. v. Mutual Boiler and Machinery Insurance Co., [1980] 1 S.C.R. 888, the court said in relation to “contra proferentum” and the nullification of coverage doctrines; I have difficulty seeing anything in its statement of time honoured principles of contractual construction that suggests that (they) will apply to an unambiguous policy. [149] At paragraph 44 the Court in Turpin stated , Only in Cabell did the Court apply nullification of coverage and reasonable expectations to what is described as an unambiguous exclusion... (Emphasis) [150] Referring earlier to Progressive Homes Ltd. v. Lombard General Insurance Co. of Canada, [2010] S.C.J. No. 33 the Court stated, The Supreme Court of Canada has repeatedly and consistently affirmed that the reasonable expectation of the parties only becomes relevant if the provisions of an insurance contract are ambiguous. (Emphasis) [151] In Progressive Homes, the single issue was whether the insurer (Lombard) owed a duty to defend the claims against the insured contractor (Progressive). The court concluded at paragraph 70 that the term “work performed” contained in the exclusion, did not clearly and unambiguously exclude the claims alleged in the proceedings. Because there was a possibility of coverage, the duty to defend was triggered. [152] It is worth noting that in Progressive, the court found that damage to one part of the building arising from another part of the same building could be included in the definition of “property damage”. [153] In the present circumstances I find the logic applied in Cabell to be instructive. While that case involved the interpretation of an exclusion (and the present case does not), in both cases the insured purchased the exact coverage that gave rise to the claim. [154] Earlier in this decision the court stated that under the normal rules of construction, a literal meaning should not be applied where to do so would bring about an “unrealistic result” or a result not in keeping with the “commercial atmosphere” in which the insurance was purchased. [155] In the present case the insureds purchased was an “all risks” policy that specifically included coverage for the escape of fuel oil. The insurer does not rely on an exclusion, but instead says the insured cannot bring themselves within the terms of the policy coverage. [156] I have difficulty with this position, because it calls for a literal interpretation of the word “building” as contained in the definition of dwelling. The existence of a separate definition for “premises” in the policy, does not of itself mean that the narrow definition proposed by the insurer should govern. [157] In effect the insurer is asking the court to rule that the definition of dwelling excludes soil. [158] In Turpin the court left open the possibility of coverage, based on reasonable expectations and nullification of coverage, in overcoming an unambiguous provision, when it said: It is not necessary to express a definitive view on this point, however, because even if these concepts were operative… I am satisfied the trial judge erred. [159] The notion of “ broader coverage” where there is no ambiguity was made more real when the court in Turpin stated : The circumstances enumerated by Laskin, J.A. in Chilton, as attracting broader coverage are not present here. (Para 46). [160] What were the circumstances enumerated by Laskin, JA in Chilton that would lend themselves to attracting broader coverage? There were three which I will summarize as follows: 1) When a policy is difficult to read; 2) When a policy is misleading by its name; 3) When the coverage sought would be negated. [161] For reasons I have referred to throughout this decision, I find that the policy in question here is difficult to read. It is certainly difficult to interpret. Its name, an “all risks, comprehensive policy” type policy, is not suggestive of the limited coverage put forth by the Defendant. Thirdly, the coverage sought would be negated. [162] I am prepared to take a stand on this issue. Even if there is not an ambiguity, I find this is the type of case, as suggested by Laskin, J.A., that should attract a broader coverage. [163] I find it difficult to conceive, in what circumstances a court would be justified in looking beyond the words of the contract, if not in a case such as this. [164] In summary, I find the circumstances before me warrant holding the insurer RSA responsible for the insureds’ loss, based on the insureds’ reasonable expectations of coverage. Even if the words themselves are unambiguous, the policy speaks for itself. [165] It was either an all risks policy or it was not. If it was then the obvious coverage should not be negated. Conclusion [166] In answer to the question posed as the issue in this matter, I find that the insurance policy does provide coverage for the remediation of the soil under the home of the Plaintiffs, Mr. and Mrs. Snow. Murray, J.