Plaintiffs owned a property at 44 Hargrave Street, Winnipeg.
On April 6, 2015, a fire caused complete loss of the property.
The insurance policy, arranged by the defendants, was believed to provide Replacement Cost Coverage (RCC) but only provided Actual Cash Value (ACV) coverage.
Plaintiffs received $1,416,911.59 for ACV through arbitration with CNA.
Plaintiffs then sued the insurance brokers for negligence in failing to secure adequate insurance.
Issues:
Negligence: Defendants breached their duty of care by failing to secure RCC as required.
Damages: Court awarded damages based on the difference between RCC and ACV, minus the amount received from CNA.
Abuse of Process: The court found plaintiffs acted within their rights to settle with CNA and pursue a claim against the brokers.
Court’s Decision:
Negligence: Defendants failed to ensure the policy provided RCC and did not adequately review or communicate policy terms.
Damages: Awarded $2,257,274.00, reduced by the amount received from CNA, resulting in $840,363.00.
Judgment: Defendants are liable for $840,363.00 plus interest.
