In a precedent setting decision, the Ontario Court of Appeal ruled that the parents of a school age bully are not covered for their negligent supervision under their home insurance policy, sparing Unifund Assurance Company from paying out.
Two other Grade 8 students were involved in the bullying of a classmate, but the claim was brought against the minor daughter of the parents identified as D.E and L.E. It’s alleged the bullying caused the complainant physical and psychological injuries.
The parents were also sued for their alleged failure to control their daughter and prevent the bullying.
Under their comprehensive homeowners' policy that provided for liability coverage if their personal actions unintentionally caused bodily injury or property damage, the parents successfully obtained a declaration that Unifund had a duty to defend and indemnify them in the underlying action. Unifund appealed.
The primary issue the appeal delved into was whether any of the properly pleaded, non-derivative claims could potentially trigger the insurer's duty to defend.
The judge examined the claims against the parents, which were described in terms such as "failure to take disciplinary action" and "failure to discharge their duty to prevent the continuous physical and psychological harassment."
The judge then compared that with the dictionary definition of negligence, which includes "failure to take proper care over something.”
He found that the claims against the parents were squarely grounded in negligence.
One of the two exclusions in the policy excluded coverage for: failure of any person insured by this policy to take steps to prevent sexual, physical, psychological or emotional abuse, molestation or harassment or corporal punishment.
The judge dismissed the lower court's finding of ambiguity, which was based on the lack of "express language" addressing whether "negligent failure to prevent physical abuse or molestation" was excluded under the policy.
