{"id":20108,"date":"2021-09-17T12:00:34","date_gmt":"2021-09-17T17:00:34","guid":{"rendered":"https:\/\/www.rsslex.com\/?p=20108"},"modified":"2022-01-12T17:05:14","modified_gmt":"2022-01-12T22:05:14","slug":"20210917_builders-risk-insurance-is-demolition-work-covered","status":"publish","type":"post","link":"https:\/\/www.staging.rsslex.com\/en\/bulletins-en\/20210917_builders-risk-insurance-is-demolition-work-covered\/","title":{"rendered":"Builders\u2019 Risk Insurance: Is Demolition Work Covered?"},"content":{"rendered":"

<\/p>\n

On June 7, 2021, the Superior Court dismissed the action in L\u2019Unique assurances g\u00e9n\u00e9rales inc. c. Intact Compagnie d\u2019assurance<\/em>, 2021 QCCS 2916<\/strong><\/a>, in concluding that the Builder\u2019s Risk issued in favor of Intact\u2019s insured did not apply.<\/p>\n

L\u2019Unique (acting in continuance of suit for Groupe Ledor inc., Mutuelle d\u2019assurance) insured Mr. Fr\u00e9d\u00e9ric Boivin\u2019s property located in Saint-Antoine-de-Tilly in virtue of a Homeowner\u2019s policy.<\/p>\n

Defendant Intact insured the activities of Les constructions Gagnon (1980) Inc. [Gagnon] as a contractor under an extended form Builder\u2019s Risk policy.<\/p>\n

The dispute between the parties related to the contents and interpretation of the policy issued by Intact favour to its insured.<\/p>\n

The facts<\/h1>\n

On June 21, 2016, a fire broke out and Gagnon was hired by Ledor to carry out selective demolition work for the purpose of assessing the damage\u00a0\u2013 but not to repair, rebuild, renovate, enlarge, or transform the building. In fact, its services were retained to allow the insurer to ascertain the condition of the premises to decide whether the building was a total loss and also to allow the claims adjuster to identify the cause and origin of the fire.<\/p>\n

On July 4, a second fire broke out, but this time the building was a total loss. Only the sections of the building that existed before the Intact policy came into effect and before the demolition work was carried out by Gagnon were damaged.<\/p>\n

Ledor indemnified its insured, Mr. Boivin, in excess of $500,000 and sought reimbursement from Intact for the indemnity paid.<\/p>\n

Builder\u2019s Risk Policy<\/h1>\n

Intact\u2019s policy covered four situations, including the one applicable to this case, the \u201cGlobal Worksite\u201d. This coverage is described as follows: \u201cInsured Property\u00a0\u2013 building under construction including renovation, extension and transformation.\u201d<\/p>\n

The \u201cInsured Property\u201d is defined as \u201cproperty [\u2026] under construction or installation and intended for the designated work [\u2026]. Non-recoverable materials and supplies necessary for said work are also covered [\u2026]\u201d [All policy translations are ours]. Finally, the policy contained an exclusion for existing buildings, namely, \u201cfixed structures that existed before the insurance took effect\u201d.<\/p>\n

Superior Court decision<\/h1>\n

The Court concluded that the policy did not cover the loss:<\/p>\n

    \n
  • The Builder\u2019s Risk policy covered Gagnon\u2019s property to be incorporated into a building\u2019s construction, renovation, extension or transformation and the materials necessary for this;<\/li>\n
  • Given the nature of the policy and the terms used, such as \u201cin the course of construction or installation\u201d, \u201center into the designated work\u201d, \u201cnecessary for said work\u201d, construction work was clearly required;<\/li>\n
  • However, the work performed by Gagnon was demolition work and no material had been incorporated into the building;<\/li>\n
  • The Plaintiff did not meet its burden of proof, which was to show that the damaged property met the description of the insured property.<\/li>\n<\/ul>\n

    Exclusion for existing structures<\/h1>\n

    On the exclusion for fixed structures that existed before the insurance took effect, the Court reviewed a number of recent decisions from the common law provinces that dealt with this type of clause. The exclusion applied; furthermore, the parties admitted that the claim applied to the destruction of a structure that existed before the insurance took effect.<\/p>\n

    Thus, the Court accepted the position of the Defendant Intact that the Builder\u2019s Risk policy did not apply in this case and dismissed the action.<\/p>\n","protected":false},"excerpt":{"rendered":"

    On June 7, 2021, the Superior Court dismissed the action in L\u2019Unique assurances g\u00e9n\u00e9rales inc. c. Intact Compagnie d\u2019assurance, 2021 QCCS 2916, in concluding that the Builder\u2019s Risk issued in favor of Intact\u2019s insured did not apply. L\u2019Unique (acting in continuance of suit for Groupe Ledor inc., Mutuelle d\u2019assurance) insured Mr. Fr\u00e9d\u00e9ric Boivin\u2019s property located […]<\/p>\n","protected":false},"author":18,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[242,50],"tags":[],"class_list":["post-20108","post","type-post","status-publish","format-standard","hentry","category-insurance-law-en","category-bulletins-en"],"acf":[],"yoast_head":"\nBuilders\u2019 Risk Insurance: Is Demolition Work Covered? - STAGING - RSS - Robinson Sheppard Shapiro<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Builders\u2019 Risk Insurance: Is Demolition Work Covered? - STAGING - RSS - Robinson Sheppard Shapiro\" \/>\n<meta property=\"og:description\" content=\"On June 7, 2021, the Superior Court dismissed the action in L\u2019Unique assurances g\u00e9n\u00e9rales inc. c. 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