Homeowners Denied Environmental Coverage For Contamination – Doctrine Of Imminent Peril

Coverage for losses due to environmental contamination in residential homeowner insurance policies is rare. Where a homeowner discovers contamination at his or her property due to an unknown source or, worse, contamination at adjacent properties emanating from the home, the homeowner may not have any insurance coverage to cover the cost of remediation. Can a homeowner undertake the remediation and then claim that he or she has coverage under the doctrine of imminent peril?

This question was recently considered by the Nova Scotia Court of Appeal in Garden View Restaurant Ltd v Portage La Prairie Mutual Insurance.¹

The plaintiff owned a residential home. The plaintiff discovered that a copper pipe connecting the fuel oil tank to the furnace had been vandalized and had caused fuel oil to discharge on the property.²