Part 31 published on 01/08/10
Appeal Court reverses trial judgment. Mould damage not covered by insurance
At trial, Minox Equities was successful in its claim for insurance coverage for mould damage (see Condo Cases Across Canada, Part 29).
The insurer, Sovereign, was successful on appeal and the trial judgment was reversed. The Appeal Court said that the causes of the mould fell within the insurance policy’s exclusions. The Appeal Court said:
“Thus, in this case, even if the mould was the result of concurrent causes, the use of the phrase ‘directly or indirectly caused’ in the exclusion clauses, allows the exclusion clauses to apply. So, in the present case, even though the evidence indicated that the right temperature, adequate food and mould spores needed to be present, the evidence also established that moisture was a prerequisite for mould growth.”