The Court dismissed the Insured’s application for a declaration the Insurer had a duty to defend the Insured who had driven his 170 horsepower SeaDoo into the Plaintiff. There was no ambiguity in the limitation clause which precluded coverage for watercraft less than 26 feet long.

Desjardins v. Luck, [2006] O.J. No. 3838, Ontario Superior Court of Justice

This was an application in which the Defendant Mr. Luck, sought a declaration that the Third Party, Allstate Insurance Company (“Allstate”) had a duty to defend him with respect to an action brought by the Plaintiff, Mr. Desjardins. The action arose following a boating accident in which the Plaintiff alleged that the Defendant negligently drove his 170 horsepower SeaDoo into the Plaintiff causing personal injury. Mr. Luck was insured under a homeowner’s policy with Allstate that protected against claims arising out of the ownership, use or operation of: a) watercraft equipped with an outboard motor of not more than 25 horsepower in total; (b) watercraft equipped with an inboard or an inboard-outboard motor of not more than 50 horsepower or; (c) any other type of watercraft of not more than 26 feet in length. The parties disputed the interpretation of this limitation clause.

The Defendant submitted that the SeaDoo did not qualify as a watercraft with an outboard or inboard-outboard motor and consequently coverage was afforded pursuant to the third type of watercraft since the SeaDoo did not exceed 26 feet in length.

Allstate submitted that coverage was provided to watercraft equipped with an outboard motor of less than 25 horsepower or an inboard-outboard motor of less than 50 horsepower. Further coverage would be provided to watercraft that might be propelled by anything other than horsepower if less than 26 feet, for example canoes.

The Court found that the suggestion that coverage was provided to a unit propelled by two motors with a combined output of 170 horsepower merely because it was less than 26 feet in length would frustrate the limitation clause and result in unrealistic expectations. The Court held that there was no ambiguity in the policy and dismissed the application.

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