knowledge that the loss will probably occur, wilful misconduct under the Marine Insurance Act does not require either intention to cause the loss or subjective knowledge that the loss will probably occur. In that regard, "wilful misconduct" has a different meaning under Canadian maritime law than it does under the Civil Code of Quebec. Accordingly, the appellants’ loss is excluded from insurance coverage. Dissent While agreeing with Cromwell J that the Convention applied so as to limit liability, Wagner J believed that the relevant provision of the Marine Insurance Act must be read harmoniously with the Convention'''s provisions, and would have therefore allowed the appeal in its entirety, with costs. Both the provisions at issue require proof of the same fact: that the insured had knowledge of the harmful consequences of his or her act, and intended or was reckless with regard to those consequences. The fact that a reasonable person ought to have known or that a person had a duty to know, does not suffice to characterize the misconduct as willful. It is also necessary to establish that the person intended to cause a loss, or to prove gross negligence or misconduct in which there is a very marked departure from the conduct of a reasonable person. Impact As Peracomo was concerned with the interpretation of the Convention, and could therefore have a wide-reaching impact on commercial maritime law around the world, the case attracted international attention. It is of interest to insurers in the areas of marine insurance and protection and indemnity insurance. The Court looked to previous cases concerning the Convention, as well as examining the Warsaw Convention (which had inspired art. 4). It effectively pointed out that art. 4 focuses on an intention to cause the loss, while the right to limit under the Convention relates more generally to the claim. It also affirmed that the limitation of liability regime under the Convention'' is "virtually unbreakable", which was already the view of many legal observers. As Wagner J pointed out, formalizing a legal difference between "reckless conduct" and "wilful misconduct" is likely to have commercial implications, and possibly increase litigation between marine insurers and their insureds. Further reading Hearing at the Supreme Court Discussion of the lower courts' rulings Notes References Supreme Court of Canada cases 2014 in Canadian case law Admiralty case law Insurance law