Coverage - Exclusions - Interpretation of policy; Policies and insurance contracts - Terms of policy

Stewart v. TD General Insurance Co.

An action for coverage under a homeowner's insurance policy to recover the full value of legally cultivated marijuana plants was dismissed. Coverage was limited to $1000 per plant as per the extended coverage provisions of the policy. The fact that the plants were not grown for "landscaping" purposes did not bring them under the general contents coverage under the policy.

[2013] O.J. No. 955

2013 ONSC 1412

Ontario Superior Court of Justice

J.A. Ramsay J.

March 7, 2013

The plaintiff was insured by the defendant under a policy of homeowner's insurance and had submitted a claim to the defendant in relation to the theft of a number of marijuana plants he was growing in his backyard. The plaintiff had licenses to possess and cultivate marijuana issued under the Marihuana Medical Access Regulations, SOR 2001 227. The defendant’s position was that coverage under the policy was limited to $1,000 per plant and it paid out $11,000 to the plaintiff for the claim. The plaintiff brought two separate actions claiming for the full value of the stolen plants and damages for breach of contract, mental stress and physical pain, breach of fiduciary duty and infliction of mental and physical suffering. The plaintiff brought this motion for summary judgment on liability in both actions.

The relevant provisions of the policy were as follows.

COVERAGE

Coverage B – Personal Property (contents)

1. We insure the contents of your dwelling and other personal property you own, wear or use while on your premises which is usual to the ownership or maintenance of a dwelling.

EXTENSIONS OF COVERAGE

15. Trees, shrubs and plants

Trees shrubs and plants being part of your landscaping on your premises. We will pay up to 5% of the limit of insurance applicable to your dwelling, subject to a maximum of $1,000 for any one tree, shrub or plant including debris removal. You are insured against loss cause (sic) by fire, lightning, explosion, impact by aircraft or land vehicle, riot, vandalism or malicious acts, theft or attempted theft.

The defendant argued that the only coverage available with respect to the plants under the policy was provided by paragraph 15 of “Extended coverage”, which limited compensation to $1,000 per plant. The plaintiff argued that the plants were personal property and were covered under “Coverage – B”. He further argued that the extended coverage for trees, shrubs and plants did not apply because the marijuana plants were not part of the landscaping.

The motions judge noted that the scheme of the policy seemed to provide for general types of coverage and then to provide coverage pursuant to the extended coverage provisions for specific items not covered in the general provisions. The motions judge commented that it would be a stretch to say that Coverage B, which is principally concerned with contents, covered items that were not contained in the dwelling. Furthermore, in the context of the policy as a whole, to ignore paragraph 15, which speaks directly to the loss of the plants, and to follow instead a general provision of doubtful application would strain the meaning of the policy. The motions judge also rejected the plaintiff’s restrictive definition of landscaping, noting that the dictionary definition of landscaping did not necessarily exclude plants that were laid out for reasons other than aesthetic. In the result, it was held that if paragraph 15 of “Extended coverage” did not cover the lost plants, neither did any other provision in the policy.

The defendant insurer had also argued that an excluded peril for damage relating to grow-ops limited recovery in this case. The motions judge held that that exclusion dealt with the damage caused by growing or production of drugs, not with the loss of the drugs themselves, and therefore did not apply in the circumstances.

In the result, it was held that the maximum recovery permitted by the policy was $1,000 per plant, which had been paid by the defendant and the plaintiff’s claim for additional recovery under the policy was dismissed.