When will an expanding plume of heating oil be considered an
imminent peril? The Nova Scotia Court of Appeal recently confronted
this slippery question while interpreting a residential insurance
policy.1
The facts
In Garden View Restaurant Ltd. v. Portage La Prairie Mutual
Insurance, the sole shareholder of a small business, Garden
View Restaurant Ltd., owned a small residential building in
Dartmouth. He discovered in 2011 that a copper pipe
connecting an outside heating oil tank had been vandalized,
allowing oil to escape onto the property.
Garden View quickly hired an environmental consultant who
directed the removal of the contaminated soil and assessed the
extent of the contamination. When the work was complete,
Garden View submitted a claim to its insurer, Portage La Prairie,
for the costs of the remediation. The insurer refused to pay
anything beyond an initial $10,000 that had been paid under an
extension for the clean-up of pollutants.
