A Nova Scotia Court of Appeal has ruled on a decade-old case that the owners of a Halifax pub that was destroyed by a fire will not be awarded any money for their insurance claim.
The property owners in question had “recklessly misrepresented” the building as one of masonry construction with sprinklers, which convinced the Court to rule in favor of the insurers.
How is your commercial carrier performing? Tell them how they can improve with our
Brokers on Carriers survey.
Search and compare insurance product listings for Damages and Fines from specialty market providers here
On March 07, 2007, a fire demolished the North End Pub. Beaufort Investments, a member of the Grafton Connor Group of Companies, had insured the structure with Lloyd’s of London Underwriters.
In 2014, an 18-day trial concluded that the broker responsible for the sale of the insurance –
Marsh Canada – was somehow “50% contributorily negligent” to the losses Grafton Connor had suffered following the fire.
A recent decision posted June 15, 2017, however, found that part of LeBlanc’s decision involving the formulation of the standard of care was made in error.
“The law allows an insurance broker to rely upon the accuracy of the information it is provided by its client. The evidence at trial will also disclose that Gary Hurst, the president of Grafton Connor, knew at all relevant times that the North End Pub was not sprinklered and was not of masonry construction,” Justice David P.S. Farrar’s decision read.
“Marsh is not required to inform Grafton Connor of information that it already knows, and that Grafton Connor had simply failed to accurately disclose through its own carelessness,” Farrar concluded.
“In a summary provided to Lloyd’s when placing the insurance, the North End Pub was described as being of masonry construction and 100% sprinklered. In the course of investigating the fire, Lloyd’s discovered that the North End Pub was neither sprinklered nor was it entirely of masonry construction.”
The court ultimately found Grafton Connor was reckless in its provision of information to its insurer. The Chronicle Herald reported that Lloyd’s was awarded $40,000 – half from Marsh and the other half from Grafton Connor. Marsh was also awarded $20,000 in costs, payable by Grafton Connor.
Related stories:
Airdrie man charged with arson, fraud for setting his home on fire twice
Ontario judge rules exclusion clauses as unfair
