The appellant insurer appealed a decision regarding its duty to defend the respondent insured.
The Court of Appeal dismissed the appeal, finding that the claim against the insured for careless conduct was clearly separable from the fraud alleged against her, and was not derivative.
Furthermore, the exclusion clause did not squarely cover the claim, as it did not rely on care, custody, or control.
The court also rejected the appellant's notice argument, agreeing with the motions judge that there was no prejudice to the appellant.
