Recent History – 2000
Cross-posted: BN07-29: Zurich Forced to Cover Memorial Arena
Oct. 30, 2000
By Mark Nielsen, Daily News Staff
Replacement of the Memorial Arena will be covered by Zurich Canada after the insurance company ran out of legal options last week.
The Supreme Court of Canada ruled Thursday that it will not hear an appeal from Zurich Canada, ending a three-and-a-half-year legal battle with the City of Dawson Creek.
The ruling put Mayor Blair Lekstrom in an upbeat mood this morning, when a press conference was held to announce the ruling.
“We always believed we were in the right, we never wavered on that, we never doubted it,” Lekstrom said.
No reasons were given for the Supreme Court decision. A one-line statement was issued saying that the application for leave to appeal was dismissed with costs.
City lawyer Wayne Plenert speculated that Supreme Court judges did not consider the issue to be of national importance, and therefore not worthy of a hearing.
Zurich Canada said last May that an application for leave to appeal would be filed after the company lost a B.C. Court of Appeal ruling last March.
Plenert said it was a complicated case because the snowfall on the roof was heavy but not extraordinary when it collapsed on Jan. 8, 1997.
He said the question was whether or not the policy should cover a construction flaw which was deemed to be the cause of the collapse.
“The answer is that, if that policy is written properly, then it does,” he said. “The city was very fortunate to have acquired a good policy, and should be grateful for that,” Plenert said.
The next step will be to determine how much of the construction of the new Memorial Arena should be covered by Zurich Canada.
“It has to pay for full replacement of the arena, however it’s not obligated to pay for upgrades,” Plenert said.
An exact figure has not been determined yet, but Lekstrom said the amount that was spent on upgrades was “not a whole lot” and added the city has been up front in keeping track of such costs.
Zurich Canada will also have to pay the city’s legal costs. Plenert said there are tariffs that will have to be worked out for each of the levels of court that dealt with the issue.
“We will work through that tariff and we will work out the maximum that we are entitled to under that tariff,” Plenert said.
Earlier this year, the city estimated the cost of replacement as well as legal fees and accrued interest at about $4.28 million.
Lekstrom said the news was a “poorly-kept secret” but said it was important that council members, city staff, and Plenert be there for the formal announcement.
Lekstrom was in Victoria at the Union of British Columbia Municipalities convention when he heard the news. “When I received the call in Victoria, I was ecstatic actually,” he said.
“I had to leave the meetings for a couple of minutes and refocus.”
Plenert said that several steps must still be taken. The numbers must be fine-tuned and then the city must meet with Zurich Canada’s lawyers and adjuster.
If they are unable to come to an agreement, the city will then have to decide whether or not to return to the courts or go through arbitration.
It should take until the end of June to know if the matter has been settled, Plenert said.