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City of Toronto third-party liability insurance

From Parks manager Sandy Straw to Jutta Mason, about the temporary rink access stairs (see Stairs For Winter) Dec.22, 2007

I arranged for appropriate City staff to inspect the stairs you installed and they are deemed unsafe, a trip hazard, and do not comply with code. Code and legal liability issues lie with City staff to ensure the park is safe and MUST be adhered to.

I understand you removed the safety fencing the first time staff erected it. Please understand this is not a legal action to undertake.

I was of the understanding you and I were trying to work together to ensure the park received amenities but that we would do things that did not jeopardize public safety or any legal liabilities that surround such actions.

When I return in the New Year we can plan for the 2007 park amenities as we originally agreed.

In the interim I expect you to respect the fact that the current version of the stairs constitutes a safety hazard and liability issue for the City and must not be reinstalled.

From Jutta Mason to Chris Gallop, assistant to City Councillor Adam Giambrone, Jan.29 2007

A. Insurance/liability

1. What is the wording of the City's third-party liability coverage pertaining to Parks or Rec programs?

2. What is the wording of third-party liability coverage pertaining to any non-program injuries to a park user or community-centre user? (E.g a person just walking through or playing pick-up sports)

3. What is the wording of the City's third-party liability coverage for volunteers in any activities taking place on parkland or in City community recreation centres?

4. Is there wording that specifically exempts permit holders from being covered by the City's existing insurance for the above three cases?

From City Risk management Analyst Theresa Lomoro to Chris Gallop, assistant to City Councillor Adam Giambrone, Feb.14 2007

As per our telephone conversation, the following is a response to the questions in your e-mail to Jim Kidd.

The City's insurance policy that responds to claims of injury associated with the City of Toronto programs and activities, including its parks and recreation centres is the Commercial General Liability insurance policy. The policy provides coverage for all sums that the City may become legally obligated to pay for third party bodily injury and property damage losses arising directly or indirectly out of the services and activities of the City of Toronto.

The policy covers the City of Toronto and its various Boards and Agencies, as listed for coverage on the policy. The policy does not extend coverage to any individual group or organization that does not report to Council. In your example you noted in your e-mail in which a group of residents wanted to buy and install stairs at Dufferin Grove Park, the City's liability insurance policy would not extend coverage to the group of residents.

Prior to any group being allowed to make any installation in a City park, Parks, Forestry and Recreation would ensure that the group obtained the appropriate approvals and permits. The approval process in necessary to ensure that all installations are in compliance with all safety concerns and, if appropriate, the installation is constructed in accordance to the appropriate building codes. Further, Parks, Forestry and Recreation would ensure that the appropriate approval is issued with the understanding that the installation is maintained by the resident group and that the group maintains Commercial General Liability insurance. The process ensures that in the event of a claim of injury by the public using the stairs, the group will have the appropriate liability insurance to defend and pay for any claim of injury.

As discussed, if the resident group has made application to the City to install the stairs leading to the Home Depot and the stairs are owned by the City and maintained by City staff, the City's Commercial General Liability insurance policy will extend to cover the City and respond to any claim initiated by injured parties.

From Peter Leiss to Mary-Margaret Jones, Feb.15 2007

In 2006 no permit was requested for fires at Dufferin Grove therefore no permit was issued. This also meant that there was no liability insurance in place.

Safety and safe use of the Park are concerns of mine as they are for all Park users. In the event of an incident or injury I would be required to demonstrate that I have followed all of the required procedures to hold an event in a Park. I am obliged by law follow the bylaws and policies and procedures that the City uses.

From Jutta Mason to Chris Gallop, assistant to Councillor Adam Giambrone, Feb.17 2007

I am puzzled by the insurance information you sent me, from the City risk management analyst. Would you be able to set up a meeting, when a few of us could talk with the City's Risk Management Analyst and you, to help us understand the City's third-party liability and volunteer insurance better? We can come to City Hall at your convenience this week or next. I have tried to clarify the questions here, to help the City Analyst research the answers.

To go over the responses in light of what I am trying to find out:

1. My question: What is the wording of the City's third-party liability coverage pertaining to Parks or Rec programs?

The City Risk Analyst's answer: The City's insurance policy that responds to claims of injury associated with the City of Toronto programs and activities, including its parks and recreation centres is the Commercial General Liability insurance policy. The policy provides coverage for all sums that the City may become legally obligated to pay for third party bodily injury and property damage losses arising directly or indirectly out of the services and activities of the City of Toronto.

2. My question: What is the wording of third-party liability coverage pertaining to any non-program injuries to a park user or community-centre user? (E.g a person just walking through or playing pick-up sports)

The City Risk Analyst's answer (I assume): The policy provides coverage for all sums that the City may become legally obligated to pay for third party bodily injury and property damage losses arising directly or indirectly out of the services and activities of the City of Toronto.

I don't understand how this works in practice, so I provide some specific questions:

a) Shinny hockey on City outdoor rinks: Does the policy explicitly say that the City is NOT covered for e.g. a shinny hockey permit, whereas the City IS covered for drop-in shinny hockey players?

(b) soccer: Does the policy explicitly say that the City is NOT covered for a neighbourhood soccer permit but it IS covered for a group of people who spontaneously came to the park with a soccer ball and began to play on an empty field?

(c) helmets: does the policy explicitly says that if the City RECOMMENDS helmets to be worn during for playing a sport it is NOT covered by its insurance, whereas if it REQUIRES helmets to be worn, it IS covered by the policy?

3. My question: What is the wording of the City's third-party liability coverage for volunteers in any activities taking place on parkland or in City community recreation centres?

The City Risk Analyst's answer: a volunteer under the terms and conditions of the City's Commercial General Liability insurance policy is a person that performs activities under the direct supervision and control of City staff and does not receive pay for those services.

What is the definition of "direct supervision" given by the policy?

Some specific questions: a) if a volunteer gardener is in the park weeding a community garden, does s/he need to be accompanied by a staff person? b) if a student volunteer is washing the dishes in the rink house, how nearby does a staff person need to be? c) if the wading pool attendant suddenly has to go to the washroom, can a parent supervise the wading pool until s/he returns? d) if a wading pool attendant has to attend to an injury 30 meters from a wading pool, can a parent volunteer supervise the wading pool until the injured person is taken care of?

4. My question: Is there wording that specifically exempts permit holders from being covered by the City's existing insurance? The City Risk Analyst's answer: There was no response to this question.

I look forward to getting a clearer picture, thanks for your help.

From Parks supervisor Peter Leiss to Mary-Margaret Jones and Jutta Mason, Feb.19 2007

There was no permit for 2006. There was no approval of sites with the Fire Department. This resulted in no indemnification for the City in the event of any incident or injury.

From Chris Gallop, assistant to Councillor Adam Giambrone, to Jeff Madeley, Director of Insurance & Risk Management, Feb.19 2007

I would like to set up a meeting with someone from your staff, myself, and a few other people, to be briefed on how the City's Commercial General Liability Insurance Policy works and to ask some questions about how it would be applied in various circumstances. Can you let me know who would be appropriate? A sample of the types of questions we're trying to answer can be found below. I need this meeting to happen sometime between now and March 2nd.

From Sarah Cormier, INSURANCE MEETING NOTES for the meeting at City Hall, February 28, 2007

- City 3rd party liability insurance – it was clarified that this is for cases of people taking action against the city, where city negligence is demonstrated

- Relevant City policy: the Commercial General Liability policy

- The city has a $5 million deductible, meaning that the city pays the first $5 million. The ceiling of the policy is $100 million, meaning that anything above that is also paid out by the city.

- Why so high? Because insurance companies are scared.

- At the time of amalgamation the deductible was $250,000.

- The city has an insurance kitty for third-party liability claims – each department is charged a premium by the city. They are currently working on a process (? Or is it in place already, my notes are unclear) where departments would be penalized if the are “not good risk managers”. This ought to give them a $ reason to do things like install stairs at DGP, but only if they're sued. There is an interesting logarithm used to calculate who pays what – parks doesn’t pay much.

- City Record Keeping:

o There are quarterly reports made to council (I think) by city insurance officials.

o “Claims Review Group” meets once a month and discuss claims pending which are $50,000 or more (this doesn’t mean they end up paying out that much, so this could be a good source of information about some small claims)

o “Loss control reports” are produced (by the claims revue group?) and distributed internally within their department

o Is there a record of the circumstances of playground injuries? Perhaps not, they are “working towards” keeping track of circumstances not just #s….

o IF ASKED BY COUNCILLOR, THEY CAN TRY TO PULL PFR CLAIMS INFO

o Old city myth: that if they try to publicize claims info, they will be sued more. Turns out it’s not true, though the idea is still that the media will getchya.

Permit Insurance Fees: Rationale – in a non-permit situation, there is no one but the city who could be responsible. But in a permit situation, suddenly there are specific identifiable people “in charge,” someone to whom the city can “transfer the risk” because they do not have control over the permitted activity. The city has a separate supplementary 3rd party liability policy for permits because they can. Here it is the inverse of the Commercial General Liability Policy – the insurance company covers the first $2 million, the city covers anything extra between $3-5 million. Then the CGL policy kicks in for $5million - $100 million.

o But: This extra coverage does not always kick in for claims made during permit times. It’s possible that it would be found that it was a facility problem (the example of the cement spot in the ice), and not something that had to do with the permitted activity. Then the extra coverage would not apply and the city would still have to pay the first $5 million. Does this insurance policy pay off? (he says they probably don't know how many claims have been paid out of this although the insurer would tell them if they asked.

o “Contributory Negligence” – the person making the claim can be found partially responsible for the incident if the city is found to have taken some measures to control the risk. So the more you tell people to wear helmets, the more responsibility is uploaded onto them. Theoretically the city has a $ stake in requiring helmets as opposed to simply recommending them. but if they put up signs recommending helmets and also making helmets available (and maybe getting people to sign a form), that would give them some protection too. This needs a case law check.

Jim couldn’t remember any claims re: skate parks. They are “not on the radar.”

o “We are not responsible” signs upload responsibility on beaches – would this work in city-built facilities? Perhaps not as well, we thought.

Volunteers – Jim suggested that the definition of “direct supervision and control” is a common sense one. It does not mean being physically on site with your eyes trained on the volunteer. (Same kind of common sense implied when law talks of the “reasonable man”)

o “Occupiers Liability Act” ? needs to be checked.

o Most claims don’t go to court. (How does settling out of court work?) But the City won't just pay claimants to get them out of the City's hair, because they don't want to set bad precedents either.

Personal responsibility of employees: a rink guard IS NOT personally liable for these injuries, it falls to the city. If the employee does something “stupid or negligent” they are not personally responsible. If they do something with malicious intent, then you’re into criminal acts.