Lakeland Mills has filed a civil court lawsuit against its insurer, claiming it had coverage for the WorkSafeBC claim against the mill's owners following the 2012 blast that destroyed the facility, killed two employees and injured many others.
According to the claim, filed Monday in B.C. Supreme Court in Vancouver, Lakeland is entitled to the coverage under the "corporate wrongful act" provision of the policy the mill's owners, Sinclar Group Forest Products Ltd., had purchased from Trisura Guarantee Insurance Company.
In July, WorkSafeBC issued Lakeland a $626,663 claims cost levy for violating regulations that govern worker compensation, as well as employee health and safety, and a $97,500 administrative penalty for $724,163 in total.
"Lakeland has incurred loss, including defence costs, in connection with the WorkSafeBC claim," the claim states.
"Lakeland reported the WorkSafeBC claim to Trisura. However, to date, Trisura has not indemnified Lakeland for its loss under any of the policies."
In part, Lakeland is seeking an indemnity related to the costs of the claim as well as damages for the alleged breach of the policy by Trisura. No dollar amounts were provided.
Glenn Roche, 46, and Alan Little, 43, died from injuries suffered in the April 23, 2012, incident. More than 20 others were injured, many suffering serious burns and ongoing trauma.
It's the second lawsuit to be filed in B.C. Supreme Court related to the blast. In January, a group of employees and their spouses filed a class action lawsuit against WorkSafeBC over its alleged conduct related both Lakeland and the explosion that leveled the Babine Forest Products sawmill outside Burns Lake in January 2012.
Carl Charlie, 42, and Robert Luggi, 45, were killed in that incident which injured 20 other workers.
Babine's owners were subsequently issued a $914,000 claims cost levy and a $97,500 administrative penalty, adding up to $1.01 million, the highest penalty ever issued by WorkSafeBC.
Both Lakeland and Babine have appealed those fines and they remain in process.
WorkSafeBC spokesman Scott McCloy said Thursday he does not have an exact date from WorkSafeBC's review division, "but a decision in either matter is not imminent."
Neither Trisura nor WorkSafeBC have filed responses in their respective lawsuits and none of the allegations have yet been tested in court.
