The Court of Appeal recently ruled in favor of Intact
Insurance in a dispute between the insurer and a poultry company.
When the dispute was originally brought to the Superior Court of Quebec, the provincial court had also ruled in favor of the insurer.
Learn more about poultry insurance here.
In May 2009, one of Acton Vale Poultry’s processing plants caught fire. Following the incident, Intact sent adjusters to the site to assess damages; the experts ultimately recommended to the poultry producer that selective demolition was necessary to save the entire property from further damage.
Acton Vale Poultry president Edouardo Estrella, however, did not heed Intact’s suggestions. Estrella claimed that the company had another expert assess it, who said that the damage to the factory was so severe that the entire facility had to be demolished. This new expert was also apparently brought in at a later date to check on a water leakage problem that affected both the company’s factory and nearby offices.
The poultry company originally claimed $778,645 from Intact but later attempted to claim even more – over $8 million in damages – reasoning that Intact did not act quickly enough to limit the damage caused by the fire.
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The Superior Court dismissed this claim, explaining that the insured had failed to act on the suggestions made by the insurer.
According to Le Journal de l’assurance
, Estrella not only failed to listen to Intact’s suggestions, but also did not bother with covering up the openings made by firefighting personnel as they quelled the conflagration in the factory. This left the property exposed to rainwater and costly water damage.
Jean-François Gagnon, a lawyer with Langlois avocats, explained to Le Journal de l’assurance
that the insured was obligated to mitigate damage as per the suggestions of the insurer as an act of good faith in the contract.
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