In Liberty Mutual Insurance Company v. Hollinger Inc., the Ontario Court of Appeal considered coverage for age discrimination under a Commercial General Liability Policy. Hollinger was sued by a former employee who included claims that Hollinger engaged in intentional racial and age discrimination.
At issue was whether the CGL issued by Liberty covered these claims. The coverage grant included coverage for discrimination under the personal injury coverage. There was an exclusion for "claims arising out of [t]he wilful violation of a penal statute." The insurer argued that discrimination was contrary to the applicable human rights legislation which provided for fines and imprisonment. The Court dismissed this argument adopting the application judge’s reasons that the statutes were remedial as well as penal. When relied upon to support a civil cause of action, they were classed as remedial. As such, they did not fall withing the penal statute exclusion.
The Court of Appeal went on to consider the general issue of fortuity. "Where an insured intends to cause the very harm that gives rise to the claim, the insured cannot look to a liability policy for indemnity." The Court held that the alleged intentional racial and age discrimination was not "fortuitous". As such, it was not covered under the CGL policy.
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