A BC Court of Appeal tribunal overturned a BC Supreme Court ruling that limited an insurance broker’s role as an agent for an insurance company.
Deasan Holdings Ltd. successfully argued the lower court ruling erred in deciding Continental Casualty Company had no duty to defend it in a lawsuit after the massive 2018 landslide near Fort St. John.
“An insurance broker was acting as agent for Continental, and through its conduct, bound Continental to insure Deasan as owner of the gravel pit,” said the May 29 ruling, written by Justice Barbara Fisher. “The broker later accepted Deasan’s notice of a change in risk by way of start up of the gravel pit operation, by conduct and by operation of Statutory Condition 4 of the Insurance Act.”
The landslide happened Sept. 29, 2018 at the gravel mine. It destroyed the only road in and out of Old Fort and sparked evacuations. Neighbouring property owners sued Deasan for damages.
Deasan, owned by Sandy Beech and Dean Swanberg, is affiliated with DRS Energy Services Inc., which hauls equipment to and from oilfield sites and maintains lease roads. DRS was charged a premium of $77,986 that was billed and collected by the broker and remitted to Continental.
Deasan asked a judge to declare Continental had a duty to defend and indemnify it under the policy with CMB Insurance Brokers. The ruling in April 2024 by Justice Allan Betton concluded the broker was an agent for Continental, but, as Griffin wrote, Betton “interpreted the certificate narrowly, and found that the broker did not extend Continental’s insurance coverage to Deasan’s gravel pit operation.”
The appeal court found that the broker had the ability to bind Continental to provide insurance to Deasan’s gravel pit operation and that the broker did so.
Justices Susan Griffin and Sheri Donegan concurred with Fisher.
