{"id":6153,"date":"2022-07-04T11:04:52","date_gmt":"2023-08-12T08:04:04","guid":{"rendered":"https:\/\/www.millerthomson.com\/ontario-court-pollution-exclusion-denying-coverage-application\/"},"modified":"2025-12-30T17:57:12","modified_gmt":"2025-12-30T22:57:12","slug":"ontario-court-pollution-exclusion-denying-coverage-application","status":"publish","type":"post","link":"https:\/\/www.millerthomson.com\/en\/insights\/lloyds-brief\/ontario-court-pollution-exclusion-denying-coverage-application\/","title":{"rendered":"Ontario Superior Court of Justice applies pollution exclusion in denying coverage application"},"content":{"rendered":"\n

The Ontario Superior Court of Justice (the \u201cCourt\u201d), sitting in Kitchener, recently ruled on a coverage application in Kin v. Ecclesiastical et al<\/em> 2022 ONSC 1655[1]<\/a>. The applicant sought coverage from Lloyd\u2019s and the Court dismissed the application in its entirety.<\/p>\n\n\n\n

Factual background<\/h2>\n\n\n\n

Kin Canada (\u201cKin\u201d) is a charitable organization. Kinsman Club of Oshawa (\u201cKCO\u201d) is a separate corporate entity and is an additional insured under Kin\u2019s commercial general liability policies with both Lloyd\u2019s and Ecclesiastical Insurance Office Public Company Limited (\u201cEcclesiastical\u201d).<\/p>\n\n\n\n

KCO sold a property to the plaintiff in the underlying action. The plaintiff sued KCO alleging that two underground fuel storage tanks (USTs) were not disclosed at the time of the sale in 2005. The presence of the tanks was not discovered until 2018.<\/p>\n\n\n\n

Kin was sued on the basis that it is vicariously liable for the actions of KCO. The underlying claim specifically alleged that the USTs had leaked. The Lloyd\u2019s policy was in force at the time of the sale. It provided occurrence-based coverage and contained a pollution exclusion. Lloyd\u2019s had no duty to defend or indemnify in relation to property damage arising out of the actual, alleged, potential or threatened spill, discharge, emission, disbursal, seepage, leakage, migration, release or escape of pollutants at any premises which were at any time owned or occupied by any insured.<\/p>\n\n\n\n

Kin brought an application seeking a duty to defend from Lloyd\u2019s and Ecclesiastical. Ecclesiastical was on risk when the USTs were discovered. KCO brought a separate application seeking a duty to defend from Ecclesiastical. The two Applications were heard together on March 3rd and 4th 2022. Counsel from Miller Thomson LLP, Elizabeth K. Ackman and Vanessa De Sousa appeared on behalf of Lloyd\u2019s.<\/p>\n\n\n\n

The Court\u2019s application of the pollution exclusion<\/h2>\n\n\n\n

The Court gave effect to the clear language of the policy by reading the contract as a whole and held that:<\/p>\n\n\n\n