Insurance causation north of the border

I said I was going to make some further observations on the Fifth Circuit’s decision in Leonard v. Nationwide this week, but unfortunately yesterday afternoon a construction crew apparently ruptured a natural gas line in downtown Portland, which forced the immediate evacuation of my building.  I am not making this up.  Like most so-called emergencies, I assumed this was merely an instance of people panicking about little or nothing, and so I intended to continue working, but I was told in unmistakable terms by my firm’s safety committee that the evacuation order also included me.  Since my secretary is on this committee, and since she had a walkie talkie, which lends a certain authority to any pronouncements and potentially enabled her to report me to whomever was on the other end of the walkie talkie, I thought it best not to argue and to leave.  Regrettably, however, while I remembered to grab my keys, I left behind a stack of Leonard briefs I have been consulting during the odd free moment.  Therefore, I’m still not ready with the post. 

But there are many other things to discuss, and among these are two recent papers I have become aware of that analyze insurance causation theory in Canada.  These papers, Proximate Cause in Insurance Law — Before and After Derksen and Causes, Exclusions and the Search for Meaning in an Ambiguous Universe, by Anthony Saunders, a lawyer in Vancouver, B.C. who is also an adjunct law professor at the University of British Columbia. These papers were eye-opening — from my first reading, it appears that the Supreme Court of Canada has endorsed a concurrent cause methodology for property insurance analysis, one which would send U.S. insurers dashing down the hallway, hysterically shrieking, to be later rounded up by the walkie talkie-wielding safety committee.  Here’s what I mean:

Derksen seems to have brought us to a state in which all causes are, by default, to be treated as having equal legal relevance, and where no cause is by itself sufficient to overcome the effect of any other cause.  The broad reading of Derksen is that the existence of any causal connection between a peril or a state of affairs that is covered, no matter how remote or seemingly inconsequential, and a loss, may effectively nullify any exclusion clause that does not incontrovertibly apply to that remote risk.

You might want to re-read that paragraph and let it soak in for a moment.  It’s a tort analysis, pure on simple, overlaid on property insurance causation, the dream of folks like former Justice Stanley Mosk of the California Supreme Court, the Big Rock Candy Mountain of policyholder lawyers.  Read the papers for further details and analysis.

UPDATE: the link to the second article was broken, it has since been fixed.

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