Ledcor Construction Ltd. v. Northbridge Indemnity Insurance Co., 2016 SCC 37

On September 15, 2016, the Supreme Court of Canada released the highly anticipated Ledcor decision. In its reasons, the Court assessed the scope of the faulty workmanship exclusion found in a Builders Risk policy, and clarified the standard of review appellate courts should give to standard form contracts. The decision will be of considerable concern to insurers.

Facts

Station Lands Ltd. retained Ledcor Construction as a construction manager to coordinate construction of Edmonton's EPCOR Tower. Station Lands then entered into contracts with various trade contractors to supply and install the goods and services needed to construct the building.

At the very early stages of the project, Station Lands purchased a "Builders Risk" policy, which covered "all risks of direct physical loss or damage...". The named insureds on the policy were Station Lands and Ledcor, while additional insureds included the owners, contractors, sub-contractors, architects, engineers,