Can an insurer recover damages from a cleaning service where a defective machine causes damage to a carpet in the home?

In Indemnity Insurance Company of North America v. Excel Cleaning Service, 1954 CanLII 9 (SCC), [1954] S.C.R. 169, the following facts appear in the headnote: "The appellant by a 'Contractors Liability Policy' agreed by 'Coverage B' to indemnify the respondent in respect of all sums it should be obligated to pay because of injury to property arising out of the respondent's work caused by accident. Exclusion clause (g) provided that the policy did not apply 'to damage to or destruction of property owned, rented, occupied or used by or in the care, custody or control of the insured'. The respondent operated an 'on location' cleaning service and due to a defective cleaning machine, caused damage to a rug it was cleaning in the home of its owner. The rug, which extended from wall to wall, was tacked down all the way round the edges by a quarter round. The rug's owner obtained judgment against the respondent and the latter sought to recover under its policy. The appellant contended that it was relieved of liability under the Exclusion clause (g)."