Brokers negligence and the standard of care is front and center
in the recent Nova Scotia Court of Appeal decision in Marsh
Canada Ltd. V. Grafton. In Marsh, the insured corporation
sustained extensive fire damage to one of its building and sought
indemnity from its insurer, Lloyds of London. Over many years,
there was a misapprehension about the profile of the property. It
was not 'sprinklered and of masonry construction' although
the insured over many years had represented that it was.
The insured corporation had a number of properties that were
subject to various insurance arrangements and a number of different
people were responsible over the years for managing the insurance
issues for the corporation. The misstatement about the building
being equipped with a sprinkler system and of masonry construction
stemmed from a 2003 application for insurance and was not an
intentional misstatement.
