Chapter 4

Question 1

What are the two legal systems in Canada?

Answer 1

Criminal Law and Civil Law are the two legal systems in Canada

Question 2

What are the goals of our legal systems?

Answer 2

Criminal Law - the goal is to punish those found guilty of an offense

Civil Law - the goal is to provide compensation to the plaintiff

Question 3

Define Statute Law and describe Statute Law’s effect on Common Law.

Answer 3

Statute Law is written law enacted by provincial or federal governments.

Statue will override common law in cases dealing with the same matter.

Question 4

What are two types of torts?

Answer 4

1. Intentional Torts
2. Unintentional Torts

Question 5

What is required for a tort to be present?

Answer 5

For a tort to be present, there must be a duty owed, this duty must be breached and there must be damages suffered by the plaintiff as a proximate result of a defendant’s negligence

Question 6

What are the main features of liability policies?

Answer 6

• Insure bodily injury, property damage, and or other direct financial loss
• Will only insure losses to third parties
• Will only insure compensatory damages awarded to plaintiffs

Question 7

What is the legal duty owed to trespassers?

Answer 7

Occupiers cannot set traps for trespassers not intentionally harm them

Question 8

What is the legal duty owed to licensees?

Answer 8

Occupiers must point out dangers not expected by licensees that are known by occupier

Question 9

What is the legal duty owed to invitees?

Answer 9

Occupiers must point out dangers known to them as well as dangers occupiers should know about with reasonable care

Question 10

Explain Occupier’s Liability Acts.

Answer 10

Occupier Liability Acts replace common law categories of licensees and invitees with the general term “visitors”. These acts require that occupiers keep these visitors reasonably safe when using premises.

Question 11

Outline responsibilities of animal owners.

Answer 11

Owners of animals are responsible for the first bite inflicted by their animals. Owners of wild animals will be subject to strict liability

Question 12

Outline responsibilities of parents.

Answer 12

Generally parents are not responsible for the torts of their children. However, parents may be at least partially responsible for injuries or damage to third parties if:

• There is a demonstrated failure of parents to properly supervise children
• When parents give their child something dangerous
• When the child(ren) are acting on authority of parents
• When child(ren) are working in the parent’s business

Question 13

Outline the responsibilities of landlords of single and multiple unit occupancies for losses occuring on rented premises.

Answer 13

Generally, landlords are not responsible for losses occurring on premises rented.

However, landlords may be responsible when:

• They conceal dangerous conditions
• They agree to maintain premises and fail to do so after receiving reasonable notice from the tenant
• In buildings having multiple occupancy, generally responsible for areas common to all occupants

Question 14

Outline responsibilities of independent contractors and principals.

Answer 14

Generally, principals are not responsible for the torts of independent contractors.

However, principals may be found at least partially responsible when:

• Principals request work that is inherently dangerous
• Principals request work that creates a public nuisance
• When work is requested that breaches statutory obligations
• When damage or injuries arise from defective equipment supplied by principals
• When principals control manner of work

Question 15

Define Licensees

Answer 15

Licensees = On land with your permission for their own purpose

Question 16

Define Invitees

Answer 16

Invitees = Invited on to land for mutual benefit

Question 17

Who is insured by Section II of Homeowners policies that are not insured by Section I of Homeowners policies?

Answer 17

Section II of Homeowners policies will insure the same people insured by Section I of Homeowners policy

Question 18

Identify 6 locations insured by Section II.

Answer 18

1. Named premises including named seasonal dwellings
2. Premises clients are temporarily residing in
3. Newly acquired premises
4. Individual or family cemetery plots or burial vaults
5. Vacant land in Canada owned or rented by clients, other than farm land
6. Land where a contractor is building a home to be occupied by clients

Question 19

What is covered by Coverage E, Section II of the Homeowners Form?

Answer 19

Coverage E - Personal Liability insures legal liability of insureds in their role as private citizens while anywhere in the world

Question 20

Describe Defense, Settlement and Supplementary Payments.

Answer 20

An additional insurance which insures many of the costs associated with legal actions. Expenses covered by this insuring agreement include:

• All expenses incurred by insurer
• All costs charged against the insured in any suit
• Interest accruing after entry of judgement
• Premiums for court bonds
• Emergency first aid expenses
• Other reasonable expenses incurred by insured by request of insurer

Question 21

What is covered by Coverage F, Section II of the Homeowners Form?

Answer 21

Coverage F insures voluntary medical expenses clients incur when third parties are injured

Question 22

What is covered by Coverage G?

Answer 22

Coverage G insurers voluntary property damage losses clients incur when third party’s property is damaged

Question 23

What is covered by Coverage H?

Answer 23

Coverage H insures voluntary benefits payable to residence employees when they are injured through no fault of insureds

Question 24

What benefits do Insurers receive when prompt notice is provided when losses occur?

Answer 24

• Provides insurers an opportunity to collect information from clients when still fresh in client’s mind
• Provides insurer the chance to inspect the location of the accident causing bodily injury to collect evidence
• Allows insurers to interview witnesses of the loss

Question 25

What watercrafts are insured by Section II?

Answer 25

Owned watercraft insured include: - Watercraft powered by outboard motors of less than 16 HP - Watercraft powered by inboard motors of less than 50HP - Non-motorized watercraft less than 26 feet in length - Newly acquired watercraft, regardless or size - All non-owed watercraft

Question 26

What motorized vehicles are insured by Section II?

Answer 26

Owned motorized vehicles include: - Lawn mowers, snowblowers and garden type tractors less than 25 HP - Owned motorized golf carts while in use on the golf course only - Motorized wheelchairs and scooters designed for disabled persons - Non-owned motorized vehicles designed for use off public roads and not subject to motor vehicle registration are insured

Question 27

What business activities are insured by Section II?

Answer 27

- Your personal actions during your employment - Not directly related to your employment - Occasionally renting your home to others - Renting out a portion of your dwelling - Renting to others space in your home for office - School or studio occupancies - Renting to others up to three spaces in garages or stables - Temporary or part-time business pursuits of insured persons under the age of 21

Question 28

Explain why Umbrella policies are called “Umbrella policies.”

Answer 28

When primary policies exclude losses, umbrella policy will 'drop down' and insure the loss. It is this drop down feature that gives umbrella policies their name

Question 29

Define and explain SIR.

Answer 29

SIR = Self Insured Retention This is an amount insureds must pay when umbrella policies drops down. The SIR acts as a deductible on umbrella policies

Question 30

Indicate whether Section II - Liability Coverage would pay the following losses. State whether Covered/Not Covered (C/NC) ___ bodily injury arising out of use of rental car. ___ loss of borrowed hunting rifle. ___ bodily injuries sustained by insured's spouse who tripped on laundry left at top of stairs. ___ drowning of three year old child while visiting your client’s home. The door leading to the indoor pool area was accidentally left unlocked. ___ water damage caused to motel room rented to the insured.

Answer 30

1. Not covered 2. Not covered 3. Not covered 4. Covered 5. Covered

Question 31

Indicate whether Section II - Liability Coverage would pay the following losses. State whether Covered/Not Covered (C/NC) ___ injuries sustained by nanny who fell off step stool supplied by your client. ___ damage intentionally caused to neighbor's window by insured's 10 year old son. ___ property damage caused while operating a boat purchased by your client 2 years ago. This boat was powered by a 350 HP outboard motor. ___ property damage caused by your client while operating a boat equipped with 350 HP inboard motor. The boat was rented at northern fly in fishing camp. ___ bodily injury caused to swimmer by 54 foot sailboat owned by the insured and just purchased last weekend.

Answer 31

1. Covered 2. Covered 3. Not Covered 4. Covered 5. Covered

Question 32

Indicate whether Section II - Liability Coverage would pay the following losses. State whether Covered/Not Covered (C/NC) ___ property damage to passing automobile by rocks thrown by 3 HP lawnmower. ___ bodily injury caused by stone thrown by 15 h.p. snowblower. Your client’s 13 year old son was being paid $20 to remove the snow from their neighbor's sidewalk after a winter storm. ___ property damage caused to Mercedes automobile by insured's golf cart which was being operated in parking lot at the time of the accident. ___ bodily injury accidentally caused by insured's 14 year old child while babysitting. ___ bodily injury caused to customer while visiting client’s home-based repair business.

Answer 32

1. Covered 2. Covered 3. Not Covered 4. Covered 5. Not Covered

Question 33

Define Negligence

Answer 33

Negligence = Omitting to do what a reasonable person, guided by ordinary considerations which regulate human affairs, would do, or doing what a reasonable person would not do

Question 34

Define Civil Law

Answer 34

Civil Law = concerned with settling disputes between individuals or other legal entities, in matters not involving a criminal act

Question 35

Define Criminal Law

Answer 35

Criminal Law = deals with wrongs against society

Question 36

What is the basic legal assumption made by the courts in cases involving strict liability?

Answer 36

Courts will assume the defendant is guilty until they can prove themselves innocent

Question 37

Explain the logic behind strict liability laws

Answer 37

When people undertake hazardous activities they are in the best position to control them. As a result they will be held to a higher standard

Question 38

Identify two activities that impose strict liability

Answer 38

1. Operating an aircraft 2. Using explosives

Question 39

What is the general legal principle regarding the liability of owners of domestic animals

Answer 39

Owners of domestic animals are responsible for the first bit or injury inflicted by the animal

Question 40

Other than the described premises what are two other premises identified as 'insured premises' in the personal liability coverage provided on homeowners forms?

Answer 40

1. Individual or family cemetery plots or burial vaults 2. Vacant land in Canada you own or rent, other than farm land

Question 41

Identify the four Insuring Agreements found in Section II of a Homeowners form

Answer 41

Coverage E - Personal Liability Coverage F - Voluntary Medical Payments Coverage G - Voluntary Payment for Damage to Property Coverage H - Voluntary Compensation for Residence Employees

Question 42

Define Trespasser

Answer 42

Trespasser = Those on land without owners permission

Question 43

Explain what Occupier Liability Acts are and what duty is owed to those defined in these acts?

Answer 43

Statutes implemented in some provinces, that have removed the terms invitee and licensee and instead created a general category called visitors The duty of care owed to visitors is to keep them reasonably safe when using premises

Question 44

Explain the key difference between the obligations imposed by these two branches of civil law: Law of Contract and Law of Tort

Answer 44

Criminal Law deals with obligations set out under contract between two or more parties while Tort law deals with breach of duty laid down by law enforcement