Legal Considerations for Losses Caused by a Fire in St. Catharines

Background of St. Catharines Fire

Question 1:

That was the worst fire in St. Catharines' history, the back of a decoration store on No. 1 Street in the business district caught fire. By August 3, it had destroyed 38 buildings throughout the business district. Andrea owns the building and has an art gallery on 52 Main Street, about 800 meters from the fire.

She estimates her total loss to be $ 1,500,000.00, including works of art valued at $ 500,000.00 and retail prices of $ 1,000,000.00. Fire inspectors have determined that the fire originated from an unlocked, unused warehouse at the back of No. 1 Avenue.

The reasons were:

1. Paint / solvent products stored in the shed spontaneously ignited, or

(i) Careless smoking or intentional action lit Solvent.

(Ii) Casual smoking or intentional behavior can ignite solvents. Rick, owner of No. 1 Main Street, knows that teenagers and temporary workers are often found in the back of his house. Rick stopped locking the shed because there were no valuables there and the shed was demolished numerous times.

Customers at a bar across the street noticed the smoke and dialed 911 at 1.15 am. 3. Main Street has recently switched from one-way streets to two-way traffic. The 911 dispatcher did not know what had changed, but instead steered the fire truck to another route, causing a delay in response. Firemen arrived at 4: 1: 45 am. 

New York City inspected Main Street 1 on June 1 and found no alarm or sprinkler system, and ordered Rick to clear the property and install the system by June 7. Otherwise, it was prosecuted under New York City regulations. No work was done, and New York City did not re-examine or initiate prosecutions. 6.

Firefighters initially tried to extinguish the fire at buildings 1 and 3 on the street instead of trying to prevent the fire from spreading to nearby buildings. It was not until the fire spread on both sides of the street that assistance was sought from the fire departments of neighbouring cities. 7.

Andrea was aware of the fire that broke out on August 1 (and elsewhere in the city), but believed that the fire was limited to No. 1 Avenue. She did nothing to protect her house or clear any inventory. Andrea's insurance company also had problems.

When she started operating and buying property in 2012, she had arranged coverage with Erica, an insurance broker at the provincial insurance company.

Factors Contributing to Losses and Damages

Andrea renews her insurance with Erica every year, and every year Erica assures her that she is in good health. She pays an annual premium of $ 5,000.00. Andrea estimates that she has purchased approximately $ 25,000.00 of inventory (retail price of $ 100,000.00) and the rest of the inventory is kept on consignment.

Consignment arrangements allow each artist to retain ownership of the artwork and to receive payment at an agreed price when the item is sold. Andrea is responsible for keeping the artwork in his own residence.

The insurance company rejected Andria's request on the grounds that her insurance only covered fire losses caused by “fire in the house” and (i) only covered items owned by Andria. (Ii) Insure only items owned by Andrea.

Andrea called Rick and told him she thought he was responsible for her losses. Rick denied responsibility and told Andrea that it was her fault because he did not properly insure his property or removed property after the fire began.

He also blamed the fire department for failing to respond or take appropriate action. Andrea wants legal proceedings against any party who may be responsible and liable to pay her compensation.

Requirement:

Discuss potential actions that Andrea should consider, questions to ask as part of legal action, and possible outcomes. Be sure to answer the applicable legal principles.

Question 2:

In order to raise funds to rebuild his own house, Andrea decided to sell the original LM.  The boss comes from her personal collection. Andrea posted the following ad on Artsales Inc.'s website on October 1;

"What to sell is a five-person original painting" Cows in the Meadow "sold by LM. Bosse. $ 250,000.00 company. Call Contact Andrea at 905-988-1234 to arrange a review or reply to "Andrea received many responses.

When she checked the email, there were 2 messages. First, the offer from Mario bought the painting for $ 225,000.00. The second offer comes from Luigi for $ 235,000.00. Andrea also received a phone message from Marge saying, "I saw your painting for sale on Artsales.com and agreed to buy it for $ 25,0000.00.

Please call me to arrange payment and delivery." (Andrea) replied to these two emails at 10:30 on October 2, with the following: "I can't lower the price. There are several parties involved.

Certification funds are needed immediately." 00 called Marge and arranged to meet her at 10:00 on the morning of October 3. Marge said she wanted to verify that the painting was the original, and said she would carry a certified purchase price check.

Andrea agrees. At 9:00 am on October 3rd, Mario sent an email to Andrea with the following text: "I accept the unconditional quote from Artales Inc. and will send a check this afternoon Here you are. "Marge arrived at 10:00 with a check, looked at the painting, and declared" I want to take it away. " Andrea hesitated, thinking the painting was too interesting.

She refused to sell it to Marge unless she raised the price to $ 300,000.00. Marge declined and claimed that a deal had been reached. Andrea opened Mario's email at 10:30 AM and sent the following reply: "Reconsidered. The price is now $ 300,000.00."

Mario replied that they had a $ 250,000.00 transaction. Luigi sent an email to Andrea on October 5, confirming that he had now arranged the necessary funds and accepted her offer. Marge, Mario and Luigi have all filed legal proceedings against Andrea for breach of contract. She didn't want to sell them any.