Duty To Defend And Concurrent Causes Of Damages

In Precision Plating Ltd. v. Axa Pacific Insurance Company, 2015 BCCA 277, the British Columbia Court of Appeal interpreted a pollution exclusion clause in a Commercial General Liability ("CGL") insurance policy. The Court of Appeal held that the insurer had no duty to defend the insured for claims alleging property loss arising from the escape of toxic chemicals.

The insured leased a space within a multi-tenanted commercial strata building and stored vats filled with toxic chemicals in the course of its electroplating business. In 2011, a fire broke out on the insured's premises, causing the sprinkler system to activate. The water caused the toxic chemicals to overflow and seep into neighbouring units. Four separate Supreme Court actions were commenced by tenants within the strata complex (the "Third Party" actions).