On the other hand, the insurers refused to pay the claim, arguing that the plaintiff made material misrepresentations and omissions when it applied for coverage. The parties have each brought a motion for summary judgment against the other, arguing that there was no genuine issue requiring a trial.

However, the NB Court of King’s Bench ultimately found there were important, genuine issues which required a trial. Consequently, the court dismissed both motions.

The court noted that the Eastland Group of Companies owned the property in Minto. When Eastland went bankrupt, the property was subjected to a mortgage in favour of a private lender. The plaintiff company, through its president Earl Daniels, negotiated with the private lender to purchase the property.

The plaintiff claimed that the loss is covered as a named peril under the policy issued by the defendant insurers.

The defendants argued that the plaintiff made several material misrepresentations and omissions which vitiated the coverage, including representations that the plaintiff was the property owner when the policy was issued, which was allegedly not the case. The defendants also claimed that the plaintiff made misrepresentations regarding the occupancy and valuation of the property. The defendants argued that had the correct information been provided by the insured, they would not have underwritten the risk, or they would have demanded a higher premium.