Canadian Underwriter

Why this 1997 home fire claim is still active in the courts

April 24, 2019   by Greg Meckbach

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An art appraiser who gave evidence in 2007 at a coverage dispute lawsuit against Chubb Insurance Company of Canada is now suing his former client.

Bridgette Sagl’s home in Mississauga, Ont. burned down Dec. 16, 1997. Chubb denied her claim, alleging arson and material misrepresentation. She sued Chubb (which was acquired by ACE in 2015) and was ultimately awarded more than $7 million.

Testifying was Darragh Elliott, an appraiser who was working on assessing Sagl’s art and sculpture collection in the late 1990s. Elliott was paid nearly $235,000 as a result of the court judgement against Chubb in favour of Sagl.

But Elliott alleged, in a lawsuit filed in 2012, that Sagl still owes him money. Those allegations have not been proven in court.

In Elliott v. Sagl, released Apr. 23, 2019, a three-judge panel of Ontario’s divisional court granted Elliott leave to file fresh evidence in his lawsuit against Sagl. Originally, in 2017, a court decided that Elliott’s lawsuit should be dismissed due to a five-year delay.

Until 1992, Sagl was married to Rudy Sagl, CEO of Beltronics Ltd., which made radar detectors for motorists. While they were married, the Sagls owned the International Gallery of Masters in Oakville.

In 1997, Bridgette Sagl owned two neighbouring homes on Doulton Drive in Mississauga. One burned down Dec. 16 while she was out for dinner. Sagl originally claimed her loss from that fire totalled $13.8 million.

In the 2007 trial involving Chubb Canada, a major issue was the value of Sagl’s fine art. Ultimately, as a result of a second trial in 2011, the Superior Court of Justice ruled that the value of Sagl’s art collection exceeded $2 million, which was the limit of the fine art portion of the Chubb policy. It also ruled that she did not intentionally misrepresent the value of her fine arts collection.

In the original 2007 award against Chubb, $2 million was for fine art coverage, $1 million was for jewelry coverage, and about $800,00 and $600,000 was for the dwelling and contents respectively. Another $132,000 was for fees for a warehouse to which contents were taken by a restoration firm after the fire.

Chubb appealed the 2007 ruling. In 2009, the Court of Appeal for Ontario rejected some of Chubb’s arguments but did order a new trial as to whether Sagl is able to prove her loss in relation to her fine arts collection and whether her  policy is void due to intentional misrepresentation.

In 2011, Justice Frank Marrocco ruled that Sagl did prove her loss exceeded the $2-million fine arts coverage limit. He further noted that Sagl agreed to pay Elliott $400,000, which she would be unable to do if she lost the lawsuit.

In the ongoing lawsuit against Sagl, Elliott alleges Sagl owes him about $135,000 from fees for the original 2007 and nearly $180,000 in fees from the second trial. Elliott also claims Sagl owes him rent. Those allegations have not been proven in court. Sagl was living in Elliott’s home from 1998 through 2003.

In the original trial in 2007, Justice Blenus Wright of the Ontario Superior Court of Justice  did not accept opinion evidence from a Chubb engineer that the fire was incendiary from three or four separate locations. Justice Wright did rule the cause of the fire was undetermined. Although Justice Wright awarded $500,000 in punitive damages against Chubb, those damages were quashed.

In his 2011 ruling, Justice Marrocco found it was reasonable for Chub to initially believe the fire was arson because Chubb got its information from the office of the fire marshall.

“Chubb was mistaken in the sense that it could not prove arson and it knew this when it abandoned the arson portion of its appeal of Justice Wright’s decision,” Justice Marrocco wrote in 2011.




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