LIABILITY Legal responsibility arising from: 1) Actions.
2) Ownership of something.
3) Use of something.
Liability Imposed By Law
1) NEGLIGENCE A person (TORTFEASOR) or persons (JOINT TORTFEASORS)
committing a civil wrong (TORT), other than a breach of contract,
against another person causing bodily injury or property damage.
Use common sense to see the consequence of your actions before you act.
2) NUISANCE a) Private Interfering with an occupant’s use / enjoyment of their premises. b) Public Interfering with a right common to members of a community.
3) BREACH OF Failing to observe an important or fundamental issue of the contract
CONTRACT based on the level of obligation imposed on contract parties.
Liability Insurance
1) Compensates the victim for injuries or damages caused by the insured.
2) Protects the insured provided: a) The insured is legally liable.
b) Damages or injury have been caused.
c) The activity is covered under the policy.
Canadian Law
JURISDICTIONS 1) Federal Military, foreign relations, currency, crown corporations.
2) Provincial Property rights, education, regulating insurance industry.
3) Municipal By-Law enforcement.
Knowing the differences between statutes in each jurisdiction is critical in determining whether legal liability exists for an individual situation.
STUDY 1 – Introduction to Liability Insurance / Page 2
CRIMINAL LAW CIVIL LAW
CRIME Act against society prohibited CIVIL ACTION Dispute between by statute. (Criminal Code) individuals or legal entities.
Guilt is determined by courts. Fault (Legal Liability) determined by courts.
Penalties - Fine / Imprisonment. Penalties - Compensation for injured party.
COMMON LAW CIVIL CODE OF QUEBEC
Originated in England France Lower Canada (1865).
Combines case and statute law. Combines case, civil and statute law.
(Acts - Environment / Occupiers Liability) (Sections - 1457 to 1481)
Decisions based on precedents created Decisions based on specific or general facts of
in previous similar cases (Analysis). each case as prescribed in the Code.
1) Decisions of higher courts supersede decisions of lower courts.
2) Body of case law in individual jurisdictions often used to support arguments.
Hierarchy of Precedent Lower courts follow similar case decisions made in higher courts.
COURTS 1) Supreme Court of Canada
2) Provincial Appeals Court Final means of provincial recourse.
3) Jurisdiction Superior Court Large cases.
5) Small Claims Court Small cases (< set amount).
STUDY 2 – Negligence – the A.B.C. Rule (Common Law) / Page 1
A.B.C. RULE Formula to prove negligence: A. A duty of care exists.
B. There was a breach of that duty.
C. The breach caused damage.
A) Duty of Care
1) STATUTE LAW R. in Right of Canada Saskatchewan
Claimant must prove:
a) the statute was breached.
b) the breach caused damages.
c) the statute was intended to prevent the damage which occurred.
d) the claimant was a member of the group the statute intended to protect.
Even if you legally comply with a statute, you can still be held negligent. (SAFETY)
2) COMMON LAW Same standard applied to all members of the same category.
NEGLIGENCE Blyth v. Birmingham
Failing to do what a reasonable person would do, or doing something a reasonable person would not do.
REASONABLE PERSON Arland v. Taylor
An intelligent and prudent person who conducts their affairs according to the standards of their community.
DUTY TO NEIGHBOUR Donoghue v. Stevenson (1932)
Before you act, you must foresee the consequences of your action and ensure you will not injure persons directly affected by such action.
STUDY 2 – Negligence – the A.B.C. Rule (Common Law) / Page 2
3) SPECIFIC DUTIES OF CARE Standard applied to all members of the same category.
a) Occupiers Established in common law and statute (OLA):
Strangers who do not enter the premises or land.
a) Keep adjacent premises free of danger. (HIGHWAYS)
Owners and occupiers of adjoining properties.
a) Keep dangerous things from escaping to adjoining premises.
b) Rylands v. Fletcher (1868) establishes rule of Strict Liability.
Persons who enter into the buildings or onto the land.
Rights are based on the circumstances under which they are on the premises:
1) Invitee a) Enters premises to conduct financial matters. (CLIENT)
b) Duty to exercise reasonable care in preventing injury.
c) Express (appointment) or implied (hours) invitation.
2) Licensee a) Enters premises with consent of occupier. (SERVICE)
b) Duty to protect from dangers known to occupier.
3) Trespasser a) Enters premises without right or consent of occupier.
b) No duty to protect from known or unknown dangers.
c) Occupier cannot deliberately set trap to cause injury.
Contractual Entrant a) Enters premises under contract with occupier.
b) Considerations: 1) Obligations stated in contract.
2) Reasonable duty of care.
Children a) Owed a greater duty of care as they can’t see dangers.
b) Nuisance / Allurement attracts them. (POOL)
b) Owners and Occupiers
Statute (OLA) imposes duty of reasonable care unless a visitor willingly assumes the risk.
1) Occupier Normally liable if person entering premises is injured UNLESS
2) Owner Fails to correct unsafe condition occupier brings to their attention.
LANDLORD’S LIABILITY
Statute (LTA) imposes duty on the occupier to keep the premises in good repair and supersedes any legal contract in the event of dispute.
STUDY 2 – Negligence – the A.B.C. Rule (Common Law) / Page 3
LEASE AGREEMENT Outlines legal responsibilities of landlord and tenant:
a) Tenant may be responsible for maintaining premises.
b) Landlord doesn’t warranty premises fit the purpose for which they are rented.
c) Tenant must notify landlord of dangerous conditions.
d) Invitees of the tenant may not be subject to contract obligations.
e) Responsibility for common areas (Hallways) in complexes.
c) Parents Not responsible unless the child is:
1) Acting under parents’ instruction or authority.
2) An employee of parent acting within the scope of that employment.
3) Given control of a dangerous thing (Animal / Vehicle) that escapes.
d) Bailees Owe greater duty of care for bailor’s property in their possession.
e) Contractual Duty
1) Contract contains clauses determining liability for third party injuries.
2) Hold Harmless and Indemnity agreements transfer liability from one party to another.
3) Common law imposes some limitations on a party’s right to pay or indemnify.
f) Civil Code Duty
- Establishes breach of statutory duty as prima facie case of negligence.
- Reasonable person becomes “ prudent and diligent “ person.
B) Breach of That Duty
Foreseeability
- Courts decide if the consequences could be reasonably foreseen.
- Minor incidents may become links in a chain of events resulting in major damage.
Polemis and Furness Withy & Co. Ltd. Spark ignited gas vapor destroying ship.
Overseas Tankship (U.K.
v. Mort’s Dock and Engineering (1961) fuel oil spilled a distance from ship.
STUDY 2 – Negligence – the A.B.C. Rule (Common Law) / Page 4
C) Damage Caused by the Breach
Causation Victim must prove the defendant’s breach caused their damages or injury.
Proximate Cause Uninterrupted unfolding of the events without the intervention of another main cause from the initial act to the conclusion.
DAMAGES Extent of direct financial loss Plaintiff suffers as the result of the defendant’s breach.
1) Compensatory Plaintiff reimbursed for injury or loss actually suffered.
a) Special Out-of-pocket expenses (Medical / Lost Wages).
b) General Additional compensation implied by law (Pain & Suffering / Future Earnings).
2) Nominal Plaintiff sues but suffers no actual $$$ loss (Libel/Slander).
3) Punitive / Exemplary a) Additional damages awarded by the court to punish the offender.
b) Not awarded if conviction and punishment under the Criminal Code.
c) Rarely awarded if acquittal under the Criminal Code.
LIABILITY POLICY a) Covers compensatory damages.
b) Excludes Nominal and Punitive/Exemplary damages.
c) Covers when force is necessary to protect persons/property.
STUDY 3 – Defences Against Negligence in Common Law / Page 1
Defendants have a number of defences against a tort action:
1) Denial Prove: a) they didn’t do it.
b) they weren’t negligent. (X Compliance with Statute)
c) plaintiff suffered no injuries.
2) Remoteness of Damage
Prove their actions didn’t cause damage or were too remote from the final consequences.
3) Inevitable Accident
Damage by outside cause over which they had no control. (KNOWLEDGE)
4) No Duty Owed
Plaintiff was beyond the range of foreseeable danger. (REMOTE)
5) Emergency
Took reasonable steps to remove themselves from danger. (AVOID KID, HIT CAR)
6) Act of God
Prove an unforeseeable act of nature was the cause. (FLOOD)
7) Voluntary Assumption of Risk
Prove plaintiff: 1) Knew about and accepted the risk.
2) Waived their right to a legal claim. (SPORTS EVENT)
8) Contributory Negligence
Plaintiff partially responsible for own injury. (NO SEAT BELT)
9) Disclaimer
Plaintiff knowingly renounced their right to recovery. (SIGNED INVOICE)
10) Limitation Period
Plaintiff didn’t bring action within period prescribed by law. (TIME LIMIT EXPIRED)
STUDY 3 – Defences Against Negligence in Common Law / Page 2
Related Factors
1) Scienter Relates to the control of domestic animals:
a) Plaintiff must prove defendant knew pet was vicious by nature OR
b) Absolute liability may be imposed by statute. (DOLA - Ontario
2) Onus of Proof
Plaintiff must prove negligence unless the onus of proof is shifted to the defendant by:
1) Statute Provincial legislation (TSA - Pedestrian).
2) Bailee Responsible for client’s items in their control.
3) The Thing Speaks For Itself a) Cause of loss controlled by the defendant.
b) Cause of loss was defendant’s negligence.
3) Strict Liability
Prove they are not liable for the escape of a dangerous thing from their premises.
(ANIMALS / CHEMICALS / NATURE)
Defences a) Act of God.
b) Plaintiff’s own actions.
c) Deliberate wrongful act of third party.
d) Plaintiff gave consent for dangerous thing to be on defendant’s premises.
e) Statute grants defendant right to keep dangerous thing on their premises.
4) Absolute Liability
Statute establishes circumstances under which there is no defence. (POLLUTION)
STUDY 4 – Negligence – the A.B.C. Rule (Quebec
A.B.C. RULE Quebec Civil Code (CCQ) contains same elements of proof as Common Law:
A) A duty of care. B) Breach of that duty. C) Breach caused damage.
A) Duty of Care
1) STATUTE LAW Duty of care defined in various Acts:
Automobile Insurance Crime Victims Compensation Workers Compensation
2283 Depositary shall keep proper care of property.
2138 Mandatary shall fulfill mandate.
2) CIVIL CODE Objective standard applied to all members of the same category.
a) Liability for One’s Own Negligence
1457 A person endowed with reason must conduct their affairs without injuring others.
EXCLUDES: Children < 7 years of age as they cannot distinguish right from wrong.
b) Liability for Other’s Negligence or Acts
1457 A person is liable for injury caused by others or things in their custody.
1459 Parents are liable for the conduct of minors under their authority
UNLESS they prove they properly controlled, educated and supervised them.
1460 Custodians are liable for the conduct of minors in their care, as proven by the plaintiff
UNLESS they did not commit a fault with respect to same.
1461 Tutors or curators are not liable for the conduct of people in their custody who are not endowed with reason
UNLESS they are proven grossly at fault with respect to that custody.
1462 Persons are not liable for the conduct of others that are not endowed with reason if such conduct is not wrongful.
1463 Employers are liable for faults committed by their agents in performing their duties.
1464 Public officials still represent the state even if they act illegally or unauthorized.
STUDY 4 – Negligence – the A.B.C. Rule (Quebec
c) Liability for One’s Things, Animals or Buildings
Persons are presumed liable and must prove otherwise (No Fault / Force Majeure).
1465 A person is liable for the autonomous acts of things in their custody.
1466 The owner of an animal and any person in control of that animal are equally liable if the animal escapes or strays from them.
1467 The owner of a building is liable for injury or damages resulting from faulty design or lack of maintenance.
d) Manufacturers’ Liability Heavy responsibility under CCQ / Consumer Protection Act.
1468 Manufacturers and distributors are jointly liable for any product defect not readily apparent to the original and subsequent purchasers of the product.
1469 Products defective in design, manufacture, safety or created from a lack of care or maintenance of the product.
1473 Manufacturers and retailers are not liable if the prove:
1) Purchaser knew of the defect.
2) Purchaser could have foreseen the injury.
3) Manufacturer could not have known of the defect.
4) Manufacturer informed the purchaser of the defect (Recall).
Separate section (3129) created for Asbestos related cases as provincial government took over production in late 70’s. Products must have originated in Quebec Quebec
e) Contractual Liability Applies to written contracts.
1458 A person who fails to honor their duty under contract is liable for injury caused and cannot avoid such liability by using rules or jurisdictions prejudicial to the plaintiff.
B) Breach of That Duty
Civil Code requires the plaintiff prove the defendant:
1) Owed the plaintiff a duty of care.
2) Breached that duty of care.
STUDY 4 – Negligence – the A.B.C. Rule (Quebec
C) Damage Caused by the Breach
Causation Principle of Proximate Cause applies.
DAMAGES Civil Code provides guidelines for claiming damages:
1611 Creditors entitled to damages for loss sustained, lost profit and future injury.
1612 Holders of trade secrets entitled to damages for development expenses and lost profit (Royalties).
1613 Debtors liable for direct damages suffered through their non-performance.
1615 Plaintiffs suffering bodily injury may apply for additional damages within a three year period.
1616 1) Damages awarded are payable in cash unless both parties agree otherwise.
2) MINORS - Court may order structured settlement until the age of majority.
- Can take action against curator if they fail to sue on their behalf.
1) Damages - Out-of-pocket expenses (Medical / Lost Wages).
- Pain and suffering.
- Loss of capacity to earn income.
2) Punitive / Exemplary Behavior contrary to the Quebec Charter of Human Rights and Freedoms, such as interfering with a person’s:
* Security or Freedom * Reputation
* Freedom of Expression * Enjoyment of Property
1621 Additional damages awarded by court to punish the offender.
- Not awarded if conviction and punishment under the Criminal Code.
- Rarely awarded if acquittal under the Criminal Code.
STUDY 5 – Defences and Negligence Cases (Quebec
Defendants have a number of defences against a delictual (tort) action by proving:
1) Rules were respected
1457 They abided by society’s rules of conduct.
2) Not endowed with reason
They don’t know what society’s rules of conduct are.
3) Superior Force
1470 An unforeseeable act of God or nature was the cause.
4) Good Samaritan
1471 They were helping someone whose life was in peril.
5) Limiting liability 1474 A person cannot have someone waive their rights unless:
1475 They create a notice stating their limitations under contract and prove the other party was aware of such limitations when the contract was formed.
1476 They create a notice of danger and prove the other party was aware of such danger.
6) Onus of Proof
1459 Tutor proves they did not commit fault in custody, education or supervision.
1465 Person proves a thing in his custody did not act autonomously (Vandalism).
1466 Owner of an animal proves the victim is at fault (Provoked/Released).
1467 Owner of a building proves no construction defect or lack of repair.
7) Manufacturer’s
1473 Prove: 1) Purchaser knew of the defect.
2) Purchaser could have foreseen the injury.
3) Manufacturer could not have known of the defect.
4) Manufacturer informed the purchaser of the defect (Recall).
STUDY 5 – Defences and Negligence Cases (Quebec
8) Voluntary Assumption of Risk
1477 Prove the plaintiffs understanding and complete acceptance of the risk.
9) Contributory Negligence
1478 Prove the Plaintiff’s own actions compounded their injuries (% of Fault).
10) Limitation Period
Plaintiff has three (3) years from the accident date to file suit.
X LIBEL - Within the year in which the defamed person learned of the defamation.
2922 Prove Plaintiff didn’t file extinctive prescription within 10 years.
2925 Prove Plaintiff didn’t file action within 3 years from incident date.
2926 Prove Plaintiff didn’t file action within 3 years from date damage first appeared.
STUDY 6 – General Legal Principles / Page 1
Many legal concepts are common to both Common Law provinces and Quebec
1) Proximate Cause
Defendant’s negligence, without outside intervention in the events, is the main cause of the injury or damage.
Scott v. Shepherd (1773)
Court held defendant responsible because stall owners acted reasonably by throwing a lighted firecracker away from their premises.
Beaudoin v. T.W. Hand Fireworks (1961)
Court held defendant not responsible because the chain of events was broken by negligence of parent and their employee.
2) Joint Tortfeasors
If two or more parties are negligent together:
a) If their specific amount (%) of responsibility is clear they are held liable for only that portion of total damage inflicted.
b) If their specific amount of responsibility cannot be determined, one party can be chosen by the Plaintiff to be held liable for the total amount of damage.
3) Joint and Several Liability
Legislation allows the Plaintiff to select one or more tortfeasors to sue for the entire amount based on which of the parties is financial able to handle it.
a) Single tortfeasor responsible for entire judgment.
b) Single tortfeasor takes action against other tortfeasors.
The Plaintiff may lose a portion of the settlement if contributory negligence is proven.
STUDY 6 – General Legal Principles / Page 2
4) Vicarious Liability
A) PRINCIPAL / AGENT QUE - MANDATOR / MANDATARY
Principals are responsible for the conduct of agents acting on their behalf based on:
a) The extent of that authority.
b) The source of that authority (Contract / QUE - Mandate).
c) The nature of the services or work.
CREATION OF AGENCY
1) Contract Principal and agent agree in writing to specific authority, rights and responsibilities related to performance.
2) Ratification Principal demonstrates acceptance and approval of the agent’s actions even though a written contract may not be in force.
3) Estoppel Principal must support the actions of their agent if such actions have been supported in the past.
4) Necessity Person is authorized by law in urgent situations to conduct themselves as an agent.
B) EMPLOYER / EMPLOYEE
Employers are responsible for:
a) Acts they authorize their employees to do.
b) The way in which such authorized acts are performed.
Employers are not responsible for:
a) Employees personal actions when unrelated to performance of their job.
b) Negligence of person(s) to whom the employee has delegated authority.
C) INDEPENDENT CONTRACTORS
Are personally liable for negligence committed in performing the work.
General Contractors Are liable for negligence committed by the
sub-contractors they hire to perform specific work.
PRINCIPAL IS LIABLE IF: 1) Dangerous (Blasting) work is being performed.
2) They interfere in the performance of the work.
STUDY 6 – General Legal Principles / Page 3
5) Municipal Liability
1) Misfeasance Improper performance of a legal act (Sewer Installation).
2) Nonfeasance Failing to do something that ought to be done (Repair Sidewalks).
3) Malfeasance Performing an unlawful act (Trespassing).
Nuisance May be created as a consequence of performing a duty, negligence must be proven.
Claims Written notice within a specified number of days (15 days) required.
Action Must be brought within a specific time period (90 days).
6) Class Actions
A member of a class can be authorized by the courts to take action on behalf of the class.
a) Each member of the class has the same interest in the subject matter.
b) A fund exists to pay claims and each members portion of it is determined.
1) Authorization of the Supreme Court obtained by proving (a) and (b).
2) Court establishes amount of collective recovery.
3) Court orders the Defendant to deposit that amount with the court.
7) Limitation Periods Periods established, either in the contract or by law, after which legal action can no longer be enforced. Can commence from:
a) Date damages are incurred. c) With minors, from the age of majority.
b) Date conduct was discovered.
8) Interest The Plaintiff is entitled to interest from the time damages occurred to the time the court awards them a settlement.
a) PREJUDGMENT i) Goods date due to trial recovery date.
ii) Nonpecuniary date of notice of claim to judgment date.
b) POSTJUDGMENT From date judgment is rendered to date damages are paid.
c) QUEBEC
STUDY 7 – Products Liability and its Effects / Page 1
Various entities involved in manufacturing and supplying products to consumers can be held liable for injuries caused by a defective product.
Ladder of Supply
Manufacturer
\ Agent
\ Distributor
\ Wholesaler
\ Retailer
\ Purchaser
\ Consumer / User
How Does Products Liability Arise?
1) CONTRACT THEORY
Only a party to a contract (Purchaser) could sue the other party to a contract (Manufacturer) for injuries caused by a defective product.
2) TORT THEORY
a) Any party injured by a defective product can sue manufacturer for such injuries.
b) Greater duty of care imposed by statute (CCQ - Consumer Protection Act).
Court held manufacturer solely liable for injuries caused by a car wheel collapsing because the retailer could not have been aware of such a defect.
Court held manufacturer solely liable for injuries caused by powdered glass found in a chocolate bar because the manufacturer had the duty to make / sell a safe product.
Court held manufacturer solely liable for injuries caused by a decomposed snail in a bottle of ginger beer because the manufacturer had the duty to make / sell a safe product.
STUDY 7 – Products Liability and its Effects / Page 2
a) Dangerous Products
If the product is inherently dangerous all entities (Ladder of Supply) must provide adequate warning of such dangers to the consumer.
Lambert v. Lastoplex Chemicals Co. (1972)
Court held manufacturer liable for damages caused by the ignition and explosion of a lacquer sealer because of inadequate warning of its inflammability.
Ruegger v. Shell Oil Co. (1964)
Court held manufacturer liable for damages caused by the spraying of a weed killer because of inadequate warning of its range and affect on other plants.
b) Product Defects
Manufacturers must warn consumers (Recall) of such defects, even if years have passed since it was sold, and offer repair or replacement.
SISTERSHIP Manufacturers are obligated to warn consumers and retailers (Recall) of defects in a product (Part) that may be a component of another product.
Rivtow Marine Ltd. v. Washington
Supreme Court held manufacturer liable for lost profits and repair costs incurred by the
purchaser of a crane who took the equipment out of service to correct the problem.
c) Allergic Reaction
Manufacturers (Cosmetics) must warn consumers (Recall) of their product’s potential to aggravate or cause such a reaction.
d) Burden of Proof
Plaintiff is challenged to prove when the product entered the Ladder of Supply:
1) It was in a defective state. 3) Manufacturer was negligent.
2) Defect caused the Plaintiff’s damages. 4) Res Ipsa Loquitor.
STUDY 7 – Products Liability and its Effects / Page 3
e) Suit in Contract (Warranty)
Claimant is challenged to prove the product is unfit for its’ intended purpose, thereby breaching the sales contract or warranty:
1) Strict Liability
- Sale
- Some states impose a heavier burden on manufacturers and suppliers.
2) Privity of Contract
Seller and buyer are the only parties to the contract.
3) Quebec
Consumer Protection Act defines buyer’s process of recovery.
f) Liability Policy
Wordings limit the Insurer’s exposure: Intentional Act of the Insured
STUDY 8 – Standard C.G.L. Policy / Page 1
The Commercial General Liability (C.G.L.) Policy
Standard form developed by the Insurance Bureau of Canada (IBC 2100).
A) Declarations Nine elements outlining nature of risk, premium:
1) Named Insured(s) Parties to the contract, financial interest, mailing address.
2) Policy Period Annual term expiring at 12:01 a.m. standard time.
3) Limits of Insurance Maximum dollar amounts of coverage per section.
4) Form of Business Individual / Joint Venture / Partnership / Organization.
5) Business Description Type of business conducted by the Named Insured (Scope).
6) Location(s) Owned, rented or occupied by the Named Insured (Territory).
7) Classification Statistical coding and advance premium (Rate per 1,000).
8) Minimum Premium Minimum charge for processing policy (Short term cancellation).
Total Premium Advance or deposit premium, due on or before inception date.
9) Endorsements Title and form number of any applicable endorsements.
Countersigned Primary (CEO) and secondary (BROKER).
STUDY 8 – Standard C.G.L. Policy / Page 2
B) Coverage Wording Five sections defining nature of coverage:
Section I Outlines four distinct areas of coverage:
A) BI / PD LIABILITY
1) Insuring Agreement
a) * Legal obligation. * Occurrence in policy period. * Territory (Canada/US).
1) Compensatory damages. 2) Claim settlement. 3) Defense.
b) BI, sickness or disease.
c) Property damage / loss of use.
2) Exclusions
a) Intentional Injury Reckless or willful acts of insured.
b) Contractual Unless defined.
c) Worker’s Compensation Or other disability benefits.
d) Employees During course of employment.
e) Automobiles S.P.F. 1, attached equipment may be covered.
f) Watercraft Unless on insured’s premises.
g) Aircraft Unless maintaining premises.
h) Property Damage Property / premises in insured’s CCC.
i) Insured’s Products Ineligible as business/trade risk.
j) Insured’s Work Completed operations unless sub-contractor.
k) Defect/Fail to Perform Products or performance.
l) Product Recall Cost of doing so.
NOTE: Pollution exclusion appears in each coverage section.
B) PERSONAL INJURY LIABILITY
1) Insuring Agreement
a) * Legal obligation. 1) Compensatory damages. 3) Defense.
2) Claim settlement.
b) 1) Territory. 2) Media exclusion.
2) Exclusions
a) Libel/slander. b) Criminal offense. c) Contractual. d) Pollution.
STUDY 8 – Standard C.G.L. Policy / Page 3
C) MEDICAL PAYMENTS
1) Insuring Agreement
a) 1) Premises. 2) Access to premises. 3) Operations.
a) Territory/term. b) 1 year limitation. c) Right of examination.
b) 1) First aid. 2) Medical. 3) Ambulance / funeral / hospital / nursing.
2) Exclusions
a) Insured. e) Athletics.
b) Employee. f) Expense prohibited by law.
c) Occupants. g) Products / Completed Operations.
d) Worker’s Compensation. h) Coverage A exclusions.
D) TENANTS’ LEGAL LIABILITY
1) Insuring Agreement
* Legal obligation. * Fire, Explosion, Smoke. * Occurrence. * Territory.
a) Compensatory damages. b) Claim settlement. c) Defense.
2) Exclusions
a) Intentional acts of insured person.
b) Contractual liability.
COMMON EXCLUSIONS (A/C/D)
1) Pollution * Premises * Waste disposal * Handling
* Sub contractors
2) Nuclear * NIAC * Maintenance * Transportation
* Supply
3) War Acts of war.
4) Misinterpretation of Date Electronic or computer equipment (Y2K), endorsed.
STUDY 8 – Standard C.G.L. Policy / Page 4
SUPPLEMENTARY PAYMENTS (A/B/D)
a) Insurer’s expense. c) Reasonable out of pocket expenses.
b) Cost of bonds. d) Court costs / interest on judgment.
Section II Who is an Insured:
(1) a) Policyholder and spouse. c) Organization / executive / directors.
b) Partnership / joint venture.
(2) a) Employees of named insured. c) Custodian of property (Death).
b) Real estate managers. d) Legal representative (Death).
(3) Newly acquired organizations: a) Up to 90 days from acquisition.
b) Excludes past acts.
Section III Limits of insurance:
1) Limit of Insurance - Maximum paid. 4) Personal Injury.
2) Aggregate (Medical / Compensatory). 5) Tenant’s Legal Liability.
3) Each Occurrence (Medical / Compensatory). 6) Medical Expenses.
Section IV Conditions:
1) Bankruptcy. 9) Other insurance.
2) Canadian Currency. 10) Premium audit.
3) Cancellation. 11) Premiums.
4) Changes. 12) Representations (Utmost Good Faith).
5) Duties in Event of Claim. 13) Separation of insureds / cross liability.
6) Examination of books/records. 14) Transfer of rights of recovery.
7) Inspections and surveys. 15) Transfer of rights and duties.
8) Legal Action Against Insurer.
STUDY 8 – Standard C.G.L. Policy / Page 5
Section V Definitions:
1) Action.
2) Automobile (Self-propelled).
3) BI includes sickness and disease.
4) Clean up (Pollutants).
5) Coverage territory (Canada
6) Impaired property (Defect).
7) Insured contract (Lease / Sidetrack).
8) Occurrence (Accident / Repeat Exposure).
9) Personal Injury (False Arrest / Malice / Slander).
10) Pollutants (Solid / Gas / Liquid / Waste).
11) Pollution condition.
12) Products sold / Completed Operations.
13) Property damage including Loss of Use.
14) Your product (Made / Traded).
15) Your work (Others on behalf of insured).
STUDY 9 – Miscellaneous Liability Coverages / Page 1
Garage Liability
* Garage, parking lot, service station. * BI - Occurrence / PD - Accident.
* Completed operations (sale/repair/service). * Premium based on payroll/size (Area).
* Endorsed on C.G.L. policy.
Employers Liability
Originally, employers held legally liable (Negligence) for BI to employees at work.
Workers Compensation Act - Benefits paid for BI /death/disease regardless of fault.
- Excludes specific categories of employees (Farm).
- Supports rehabilitation and accident prevention (Inspection).
- Employee collecting is banned from suing employer.
- Premium based on number of employees/nature of work.
Employers BI Liability - Endorsed on C.G.L. policy.
- Premium based on payroll and adjusted at end of term.
X Contractual liability. X Intentional acts.
X Aircraft completely. X Building alterations.
X Workers Compensation.
Voluntary Compensation - Compensates employees ineligible for WCS.
- Lower benefits paid for BI /death/disease regardless of fault.
- Premium based on payroll and adjusted at end of term.
Contingent Employers’ - Contracts/periods/provinces/trades ineligible for WCS.
- C.G.L. insurer obligated to defend even if injury off job.
Tenants’ Legal Liability
* Lease outlines legal obligation/exemption. * Subrogation waived on insurer’s approval.
* Tenant may be considered a joint insured. * Premium based on payroll/size (Area).
* Endorsed on C.G.L. policy. * Umbrella covers with SIR.
Bailees Liability
* Processors (Dry Cleaners) have a legal responsibility for property temporarily in their custody.
STUDY 9 – Miscellaneous Liability Coverages / Page 2
Pollution Endorsements
C.G.L. offers two options, for added premium, that provide limited third party liability coverage:
1) Limited Pollution Liability Extension Compensatory PD for occurrences as defined in Sections A/C/D.
2) Limited Pollution Liability Extension (120 Hours) Compensatory BI/PD for occurrences as defined in Sections A/C/D.
Non-Owned Automobile Liability Policy
Protects employers when employees, on behalf of the employer, operate non-owned automobiles:
a) Rented. b) Employee owns. c) Independent contractor owns. d) Other.
2) Was the driver (employee) acting as an employee or independent contractor?
Personal Liability Insurance
* Actions, ownership of property/animals. * Compensatory damages only.
* Included in residential policies. * Premium flat rate per residence.
1) Personal Liability Covers personal actions or uses world-wide EXCEPT:
X Specific vehicles. X Property/fixtures worked on.
X Property leased, occupied, owned or used. X BI to insured / household resident.
X Property in care, custody or control.
2) Premises Liability Property used, owned, occupied or contracted.
3) Tenants Legal Liability - Premises used, rented or in custody or control.
- Fire / explosion / smoke only.
X Smoke from fireplace / Contractual liability.
4) Employer's Liability - BI to residence employees arising from their employment.
X Aircraft completely / Worker's Compensation Statute.
STUDY 9 – Miscellaneous Liability Coverages / Page 3
VOLUNTARY MEDICAL PAYMENTS - Moral, not legal responsibility assumed.
- BI to third parties / residence employees.
- Reasonable expense.
X Specific vehicles-watercraft / persons / WCS.
VOLUNTARY PROPERTY DAMAGE Moral, not legal responsibility assumed.
Farmers Personal Liability
* Farming operations/property/servants. * Premium based on type/size (Acres).
A) Legal Liability Personal / Premises / Tenants.
B) Voluntary Medical Payments - Unintentional BI caused by farmer / hired help.
- Medical expenses incurred within one year.
C) Voluntary Property Damage - Unintentional PD caused by farmer / hired help.
BUSINESS: Trade, profession or occupation other than farming.
BUSINESS PROPERTY: Other than farming.
FARMING: Includes roadside stands for selling products produced by farmer.
STUDY 10 – Underwriting Exposure Measurement
Underwriters assess the desirability of the risk, and decide to accept or reject it, based on a number of factors.
HAZARDS
1) Moral Chance of loss increased by insured’s careless running of their business and non-cooperation with insurer.
2) Physical a) Nature of work performed.
b) Premises (construction/location/occupancy/area).
INFORMATION SOURCES
1) Application Complete details of exposures and operations.
2) Inspections Company rep inspects the risk, reports to underwriters.
3) Surveys Questionnaire and photos on large commercial risks (Cost) for underwriters to assess details and classify:
a) Simple i) Insured’s name, business history.
ii) Premises occupancy, location, age, condition.
iii) Safety features, lighting, equipment (Elevators).
iv) Employees, processes (Food).
v) Sidetrack, off premises operations.
b) Complex Construction projects - contracts, nature of work, site.
Theatres - leases, maintenance, safety, capacity, food.
Manufacturers - types of goods, transportation, territory.
c) Hazardous Detailed information about equipment, processes and qualification for:
X Gas distribution X Welding
X Spray painting X Demolition
X Chemical spraying X Public facilities
4) Claims reports Document moral / physical hazards that may influence underwriter accepting, reassessing or rejecting at renewal.
No comments:
Post a Comment