British Columbia Insurance Blog : Canada Insurance Lawyer & Attorney : Michael Thomas of Harper Grey Law Firm : British Columbia, Vancouver

Halpern Investments Ltd. ("Halpern Investments") was unsuccessful in obtaining an order that it was covered for damages resulting from fire where it was admitted that the principal of Halpern Investments ("Halpern") had previously submitted a fraudulent proof of loss relating to the same fire on behalf of a co-insured company ("Regal"). The court found that Halpern was the guiding hand behind both Halpern Investments and Regal and that his fraudulent conduct warranted piercing the corporate veil to ensure that Halpern did not benefit from such conduct.

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An Insurer does not have to defend an action commenced against an insured under a homeowner’s insurance policy that contains an intentional act exclusion clause if there is no basis for the allegations outside of an intentional tort.

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An insured ("Mr. Metcalfe"), who died of a drug overdose, had purchased a life insurance policy seven years before his death. Although he did not disclose to the life insurance company that he had been in a drug treatment program for cocaine and heroin use three years before obtaining the policy, the life insurance policy was determined to be valid, because the insured did not fraudulently misrepresent his status to the insurer.

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An insured who was advised not to drive by his physician due to epileptic seizures will void his automobile insurance policy if he chooses to drive, despite the fact that the automobile insurer did not enquire about the insured’s medical condition during the application process.

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An operator of an elementary school ("Palliser") was successful in obtaining an order that its insurer ("Aviva") was obligated to defend it with respect to claims brought by neighbours of Palliser which alleged that coal dust transported by wind from Palliser’s property was damaging their homes. The court held that the Pollution Exclusion in the policy did not apply to these claims as blowing coal dust failed the common sense test for "pollution" which was intended or expected to be excluded from coverage.

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This was the trial of a plaintiff/insured’s claim against his automobile insurer solely based on an allegation of bad faith. The issue was whether the insurer was liable to the insured for punitive, intangible, and aggravated damages where the insurer had paid out all coverages under the policy. The Court held that there was a breach of the duty of good faith, and regardless of whether the insurance claims were ultimately satisfied the plaintiff’s damages were compensable. The Court refused to award punitive damages, but awarded nominal damages for intangible and aggravated losses. The Court rejected the argument of the insurer, based on previous case law, that a plaintiff must have a successful action for some specific coverage under the policy before an action can succeed for bad faith.

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An insured under a homeowner’s policy ("Revivo") was successful in obtaining an order that his insurer ("State Farm") was obligated to defend an action against Revivo arising from a fire started while he was working on a "parts car" while completing a kit car. The court held that the exclusion clause in the policy relating to ownership, use or operation of a motor vehicle was inapplicable where neither the parts car nor the kit car was useable or operable as an automobile.

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When an Insured no longer has his or her policy of insurance, the court may rely upon secondary evidence to establish the existence of a policy. In such circumstances, the court may infer that the terms and conditions of the policy of insurance are similar to the terms and conditions in other policies written by the insurance company.

Allegations of vicarious liability against an employer for sexual assaults perpetrated by an employee prior to the initiation of an insurance contract, will not be covered by an occurrence-based policy. This is true even if the full extent of the damages suffered by the victim are not discovered until the policy is in force.

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A family was insured through a homeowners policy. The son sexually assaulted two children who were being babysat by the parents. An action was commenced against the son for sexually assaulting the children and against the parents for negligently supervising the children, and failing to warn the children’s parents of their son’s propensity to molest children. The son was not entitled to insurance coverage pursuant to the homeowner’s policy because it contained an exclusion for actual or alleged sexual molestation. The parents were not entitled to coverage under the policy because the claims against them arose from an event for which coverage was expressly excluded.

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The Motor Vehicle Accident Claims Fund of Ontario does not have the right to compel an insurance company to participate in an arbitration to resolve a dispute over which of two insurers is required to pay funds under a policy of automobile insurance.

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