Justice Morgan heard the motion. His decision highlighted the unfairness of this exclusion clause and acknowledged the hardship and position of the plaintiff. Nevertheless, he decided in favour of the insurer and dismissed the plaintiff's case. The plaintiff was left with the loss of her home and no insurance coverage to repair it.
The fall-out of the decision was not a determining factor in the overall analysis. As difficult as it is to understand, the judge’s hands were tied in the matter. The law in Ontario is clear; it has dealt with this exclusion clause in the past and has refused to put it aside.
Other provinces have taken a pro-active approach to avoid such unjust scenarios by enacting a bar against these types of exclusionary clauses. Unfortunately, Ontario has not followed suit. There’s no doubt that there is fundamental injustice in this decision. It is a prime example of how the law doesn’t always consider fairness and iniquity.
You can read the decision in its entirety here.