The doorbell rang. Martha rushed to open the front door.

“Why, Louella. And Mark. What a surprise. I thought you were in Prince Rupert.”

“You don’t seem very happy to see your daughter and grandson, Mother.”

Martha appeared flustered. “Of course, of course I am. It’s just that I wasn’t expecting you. I thought you were still living with that man. Come in, let me carry in your bags. John, come down, you’ll never guess who’s here.”

John came bounding down the stairs, hugged his daughter and three-year-old grandchild.

That evening they sat around the fire. “So Louella,” John said, “what’s been happening and what are your plans?”

Louella stared into the fire. “You know Tom, that man I was living with? Well, he left. I have no money. That’s why I came home. But I’m leaving soon for Kelowna. A friend there has got me a job waitressing.”

Martha straightened her skirt. “Oh, I do hope you will be able to settle down. It’s been so hard for you, not having a father for your child. Now, you and Mark get off to bed. I’m sure everything will work out for the best.”

The next morning, Martha and John were sitting at the breakfast table watching their grandson frolic on the lawn while Louella was using the riding mower to cut the grass.

There was a scream. Martha and John rushed outside to find a horrifying sight. Louella had lost control of the mower and had cut off Mark’s leg.

A decision was made. Mark would sue his mother and grandparents for damages. The grandparents were covered by insurance for $500,000. The insurance company would have to pay.


In court, Mark was successful. He was awarded $864,000. But the insurance company refused to pay. So the family sued the insurance company.

The insurance company wasn’t budging. “Your honor, Martha and John’s insurance included $500,000 of personal liability coverage subject to the exclusion to persons residing in the house. Louella and Mark were living at the house. They did not have any other address. That means we have no legal obligation to pay one cent.”

The grandparents argued: “Your honor, Louella and Mark were living with us for a week. They were in transition. They were not residents of our house. They were our guests. Louella was looking for a place in Kelowna. The insurance company is trying to get away from its obligation by misinterpreting the facts. Make them pay.”

Should the insurance company cover the damages? You! Be the Judge. Then look below for the decision.

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“Insurance company, pay up every cent of that $500,000 policy,” ruled the court. The judge held that Louella and Mark were not residents of the house, and therefore the exclusion did not apply. To be a resident, a person must be physically present for a period of time and must have the intention to remain. Although Louella and Mark were living temporarily at the house, they did not intend to stay indefinitely.