Pubdate: Tue, 29 Mar 2016
Source: Penticton Herald (CN BC)
Copyright: 2016 The Okanagan Valley Group of Newspapers
Author: Joe Fries
Page: A4


Mutual Fire Insurance Company Said It Found Evidence of a Marijuana 
Grow-Op in Oliver Suite

An insurance company has been ordered to pay an Oliver woman $278,000 
after initially denying her claim for fire damage to a suite she 
owned in which evidence was found of a marijuana grow-op.

A storage facility with built-in living suite on a rural property 
south of Oliver owned by Kawaljeet Bahniwal was destroyed by fire in 
August 2010, according to a decision released earlier this month by 
the B.C. Supreme Court.

Three months later, The Mutual Fire Insurance Company of British 
Columbia sent her a letter explaining her claim for replacement cost 
of the structure and contents had been denied because an investigator 
found evidence of a marijuana grow-op amongst the ruins.

The company claimed Bahniwal ought to have known about the grow-op 
and disclosed it, which would have prompted Mutual not to take her on 
as a client, thereby rendering her insurance policy null and void. 
The company even refunded her premiums, although the cause of the 
fire was never determined.

Bahniwal claimed, however, that she and her husband rarely visited 
the rental suite, and when they did, never saw nor smelled any 
evidence of a marijuana grow-op, and therefore could not have 
disclosed it to the company.

Besides the evidence of the grow-op discovered by a fire 
investigator, the eight-day trial in Kelowna also heard from 
Bahniwal's tenant, who admitted he was getting ready to produce pot 
at the time of the fire.

Electricity bills for the suite, which were in Bahniwal's name and 
higher than what might be expected for the suite were also admitted 
into evidence, but the judge accepted Bahniwal's husband's 
explanation that he never paid much attention to the charges, which 
the tenant paid promptly with cash.

The judge said the Bahniwals seemed to struggle in court with 
English, but he nonetheless formed a "favourable impression of them."

"They may not have answered every question correctly, but I am not 
satisfied that they knowingly gave false evidence," Joyce concluded.

"In particular and on balance, I accept their testimony that they 
were not aware of the existence of marijuana grow operations on their 

Although the judge agreed to reward Bahniwal the full replacement 
values of the building and contents, plus legal costs, he declined to 
impose punitive damages to punish Mutual for its alleged mishandling 
of the claim.

"While the defendant ultimately has been unsuccessful in its denial 
of liability on the grounds of misrepresentation, I do not believe 
that it acted with undue haste or in bad faith in taking the position 
that it took and in dealing with this claim," wrote Joyce.

"The defendant had a reasonable basis for taking the actions it did 
and did not act on a mere suspicion."
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