New Full Indemnity Exception In Coverage Cases

The Superior Court of Justice recently released an important decision finding full indemnity costs payable in a coverage case.

In the underlying action, a young boy was severely injured by a car after his father dropped him off in a parking lot. The boy (via his litigation guardian) and the boy's mother (via the Family Law Act) sued the father for damages. The father's insurer found a duty to defend and the insurer's counsel represented him at trial. At trial, over $900,000.00 in damages were awarded. Following the trial, the father's insurer denied coverage.

The mother and boy brought a claim against the father's insurer under section 258(1) of the Insurance Act, which allows parties to bring a claim to enforce judgment against insurers. At the summary judgment motion, the court found that there was coverage.