In Ferro v. Weiner, 2019 ONCA 25 (“Weiner”), the Ontario Court of Appeal overturned a Superior Court decision on the definition of “household” within the standard homeowner’s policy. While the Superior Court adopted a bare-bones residency-based criteria, the Court of Appeal held that a rigorous holistic analysis is required to determine whether or not a person is a member of a household in the insurance context.
The case concerned a named insured, E.W., who had purchased a homeowner’s policy from Intact Insurance in relation to her primary residence. Though E.W. was the sole named insured, the policy included the standard form wording that E.W.’s relatives “living in the same household” were also considered to be insured.
E.W. moved out of the property and into a nursing home in 2008 or 2009, but maintained the Intact policy. Her adult children and her grandchildren continued to use the property as a cottage in her absence: they did this regularly and with E.W.’s permission, apparently treating the property as if it were their own. Evidence was led that this was their childhood home and that they continued to view it is theirs, even after growing up and establishing families of their own.
Sadly, in May of 2010 a teenager drowned on E.W.’s property. The teenager had been a guest of E.W.’s granddaughter R.W. and her adult son Scott, both of whom were at the property at the material time.
When the teenager’s estate sued Scott, his wife, and his daughter, TD Insurance provided their defence through a separate policy. After settling the claim, TD brought a motion against Intact Insurance for a declaration that Scott, his wife, and daughter were insureds under the Intact policy, and that Intact must indemnify TD for the cost of their defence and indemnity.
The motion judge set out to determine whether Scott, his wife and daughter were “living in the same household” as E.W., within the meaning of the policy. She founded a binary approach, wherein Scott and his family could only be categorized as either visitors to or members of the household. The motion judge asserted that because Scott used the house often and contributed to its upkeep, he and his family were more than mere visitors. Because they were not visitors, they had to be members of the household, according to the motion judge.
On appeal, Intact argued that the motion judge’s assessment of “household” was flawed by virtue of its narrow focus on the nexus between Scott and his use of the house. The Court of Appeal agreed with Intact, asserting: “the inquiry into Scott’s relationship with the house was not the ultimate question”, and noted a line of decisions that showed “one can be a resident in a house…without being a resident in or of a household”.
The Court of Appeal held that membership in a household is more accurately assessed by examining the “relations and intentions” between people, and in this case, between Scott and his mother E.W. The Court recalled Wawanesa Mutual Insurance Company v. Bell, 1957 CanLII 16 (SCC), [1957] S.C.R. 581 which defined household as “a collective group living in a home… between whom there is an intimacy and by whom there is felt a concern with and an interest in the life of all that gives it a unity”.
Ultimately, the Court of Appeal determined that the relationship between Scott and his mother, as of the date of loss, lacked the “intimacy, unity and permanence” to qualify him and his family as members of the same household as E.W.. The Court noted too that Scott and his family had their own household in the city where they resided together most of the time and without E.W., and that only under very rare circumstances is it possible for a person to meet the intimacy, unity, and permanence requirements of two households at once.
The Weiner decision is a boon for insurers. It will be used to limit the availability of insurance under homeowner’s policies, particularly with respect to adult children who otherwise continue to enjoy substantial benefits through – but not with – their parents.
Sonya Katrycz is the author of this blog and member of the Coverage practice group. If you have a question about this decision or a similar file, please contact Sonya.