Vacating property insured by a policy of fire insurance constitutes a material change in the risk insured by the policy. Failure to notify the insurer will void the policy. If the insured’s insurance broker is advised that the property has been vacated, the insurance broker has an obligation to advise the insured that the property may no longer be insured by the policy. However, if the insured was aware that vacating the property could void his insurance, the insurance broker will not be liable for any damages resulting from an uninsured loss.

31. March 2005 0
Ken Murphy Enterprises Ltd. v. Commercial Union Assurance Co. of Canada, [2005] N.S.J. No. 114, Nova Scotia Court of Appeal

A former student of Upper Canada College commenced an action against four teachers alleging sexual assault. In addition, the student alleged that each of the teachers knew or ought to have known that the Plaintiff was being abused by the other teachers, and that each of the teachers failed to take any adequate steps to prevent or stop that abuse. The teachers named in the Statement of Claim applied for a declaration to have the allegations made against them defended pursuant to Upper Canada College’s policy of insurance. The court determined that despite a section in the policy which excluded coverage for bodily injury caused intentionally by or at the direction of the insured, the allegations of failing to take any adequate steps to prevent or stop the sexual abuse of the student constituted an independent tort, and the teachers were entitled to coverage under Upper Canada College’s policy of insurance to defend the allegations made against them. However, given the nature of the excluded allegations the insurer was only responsible for 20% of the teacher’s defence costs.

30. March 2005 0
Sommerfield v. Lombard Insurance Group, [2005] O.J. No. 1131, Ontario Superior Court of Justice

In a case where an injured party in New Brunswick has been overcompensated for past loss of income as a result of receiving section B Loss of Income Benefits, the trial judge is obligated to reduce the amount payable for non-pecuniary damages to account for the over-compensation in applying the release provisions of section 263(2) of the New Brunswick Insurance Act

21. March 2005 0
Gagnon v. Black, [2005] N.B.J. No. 124, New Brunswick Court of Queen’s Bench Trial Division

The ‘insured v. insured’ exclusion clause contained in a Directors and Officers Liability Insurance policy generally excludes coverage to officers when a claim is brought against them by the Corporation named in the policy. Despite the clear wording of the clause, the clause will not exclude coverage to an officer when the officer and the Corporation are adverse in interest.

04. March 2005 0
Kohanski v. St. Paul Guarantee Insurance Co., [2005] O.J. No. 5882,  Ontario Superior Court of Justice

The Court of Appeal dismissed the appeal of the insurer who was ordered to pay the replacement cost of a house damaged by fire. This was despite the insured’s failure to comply with the requirement of the policy to repair or replace damaged buildings within 180 days because the replacement cost was found not to have been settled between the parties within the time allotted.

04. March 2005 0
Hua v. Optimum West Insurance Co., [2005] B.C.J. No. 412, British Columbia Court of Appeal

The Defendant (the “Insured”) in a defamation action applied for a Declaration that it was entitled to a defence under the terms of a Directors’ & Officers’ Liability policy (the “Encon Policy”) and a Commercial General Liability policy (the “Co-Operators Policy”), and for a further Declaration that it was entitled to appoint its own counsel. The court held that Co-Operators had a duty to defend because some allegations in the pleadings fell within the realm of its duty to defend. The court further held that the Insured was entitled to appoint its own counsel at the expense of the Insurer.

04. March 2005 0
Conservation Council of New Brunswick Inc. v. Encon Group Inc., [2005] N.B.J. No. 109, New Brunswick Court of Queen’s Bench Trial Division