The respondent's unique vessel sank after an employee negligently left an air pressure control valve open.
The appellant insurers denied the claim, arguing the loss was not caused by a 'peril of the seas'.
The Supreme Court of Canada held that the unintentional admission of seawater due to a negligent act, coupled with its foreseeable consequence, constitutes a fortuitous accident and a peril of the seas.
The Court also rejected the insurers' arguments regarding unseaworthiness, breach of warranty, and failure to disclose material circumstances.
The appeal was dismissed.
