Agro’s Foods v. Economical, 2016 ONSC 1169

Agro’s Foods v. Economical, 2016 ONSC 1169

CITATION: Agro’s Foods v. Economical, 2016 ONSC 1169

COURT FILE NO.: 12-34535

DATE: 2016-03-24

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

AGRO’S FOODS INC. and ROCK CHAPEL MUSHROOM FARMS INC.

Plaintiffs

• and -

ECONOMICAL MUTUAL INSURANCE COMPANY

Defendant

COUNSEL:

William Dermody & Angela Papalia, for the Plaintiffs

Murray Stieber, for the Defendant

HEARD: November 20 and 27, 2015

BEFORE: The Honourable Justice C.D. Braid

RULING ON MOTION

I. INTRODUCTION

1The defendant, Economical Mutual Insurance Company (“Economical”), insured the buildings used by the plaintiffs, Agro’s Foods Inc. (“Agro’s Foods”) and Rock Chapel Mushroom Farms Inc. (“Rock Chapel”), to grow mushrooms. In the spring of 2011, two windstorms severely damaged those buildings and prevented the plaintiffs from producing mushrooms.

2The plaintiffs seek summary judgment for building replacement costs of $2.6 million and business interruption losses of $250,000. The plaintiffs also seek punitive, aggravated and exemplary damages; and damages for breach of duty of good faith. Finally, the plaintiffs ask the court to reserve its decision to permit prospective declaratory orders for reimbursement of future costs.

3Economical states that some of the damage to the buildings pre-existed the windstorms, and is excluded from coverage. The defendant argues that, in light of contradictory expert reports on that issue, there is a genuine issue requiring a trial. Economical states that the plaintiffs must rebuild before they are entitled to replacement cost and that there is insufficient evidence to prove the business interruption losses. Finally, Economical says that it has invoked its right to an appraisal, which should proceed before litigation.

4For the reasons that follow, I find that this is not an appropriate case to grant summary judgment. I have made numerous findings of fact and direct that a trial proceed before me on certain defined issues as outlined below.

II. FACTS

5Based on the evidence filed on the motion, I make the following findings of fact:

A. The Insurance Policy

6Rock Chapel grew mushrooms and sold them to Agro’s Foods and other distributors, who in turn sold the mushrooms to others. Economical insured the plaintiffs under a policy of insurance that provided indemnity for damages plus business interruption losses (“the policy”). The policy was in full force and effect at all material times and continues to be in full force and effect. The policy covered buildings owned by Agro’s Foods and used by Rock Chapel to farm mushrooms (“the buildings”). Wind was an insured peril under the policy.

7The following terms of the policy are relevant:

i. The policy insured “against all risks of direct physical loss or damage to the property insured”;

ii. The policy excluded from coverage “wear and tear, gradual deterioration, latent defect” and “the cost of making good…faulty or improper design”;

iii. Nothing in the policy required the property to be compliant with current building codes, and this was not a precondition to coverage;

iv. The policy included a replacement cost clause. Replacement cost was defined as “the cost of replacing, repairing, constructing or reconstructing (whichever is the least) the property with new property of like kind and quality…without deduction for depreciation” and includes “repair, construction or re-construction with new property of like kind and quality”;

v. The replacement cost clause was subject to certain conditions, including a condition that the insured must rebuild before Economical was required to pay replacement cost, subject to the following conditions:

(i) Replacement shall be effected by the insured with due diligence and dispatch;

(ii) Settlement on a replacement cost basis shall be made only when replacement has been effected by the insured and in no event shall it exceed the amount actually and necessarily expended for such replacement; and

(iii) Failing compliance by the insured with any of the foregoing provisions, settlement shall be made as if this endorsement had not been in effect;

vi. In addition to covering damage to the buildings, the policy contained a business interruption clause that insured “against loss directly resulting from necessary interruption of business caused by destruction or damage by the perils insured against, to buildings”, to a limit of $250,000; and

vii. The policy contained standard conditions, including an appraisal condition: “in the event of disagreement as to the value of the property insured, the property saved or the amount of the loss, those questions shall be determined by appraisal…There shall be no right to an appraisal until a specific demand therefor is made in writing and until after proof of loss has been delivered.” The issue of whether this statutory condition applied to all perils is discussed in more detail below.

B. Building Inspections

8Economical conducted periodic inspections and reviews of the buildings and concluded that all buildings were in proper, insurable condition. The most recent inspections of the buildings were undertaken in 2008. In the Risk Control Survey prepared following that inspection, it was observed that the building was “quite old” and that it had “many signs of wind damage”. The report observed that the building will “always be subject to wind damage, if nothing else due to the size of the structure.” The report rated maintenance as “standard” and noted that maintenance on the building was ongoing, although it is “only done where it is required.”

9These buildings were found to be an acceptable risk to the insurance company. Economical issued replacement cost coverage on this basis and the plaintiffs paid a premium for this coverage.

C. Windstorms

10On April 28 and June 4, 2011, severe windstorms caused damage to the buildings. Economical was immediately advised of the damage.

11There was significant damage to the roofs of the buildings. The photos filed on this motion also show horizontal and vertical cracks in the walls, as well as window and door panels that are bent and/or out of alignment. The parties disagree about whether the wind caused the damage to areas other than the roofs.

12The grow rooms were not in use at the time of the windstorms. The plaintiffs were scheduled to resume planting mushrooms in July 2011, which would be picked in August 2011.

13The plaintiffs have not repaired or replaced the buildings. They have been unable to produce mushrooms since the windstorms.

D. Communication Between the Parties

14Economical retained an adjuster to act as its representative with respect to this claim. The following is a summary of the relevant communication between the parties:

i. On May 6, 2011, (before the second windstorm) the adjuster wrote to the plaintiffs and stated that the cause of loss was determined to be wind. The adjuster told the plaintiffs that Economical had “preferred vendors” to undertake the work on a replacement cost basis without deduction for depreciation, and further stated:

any work done to your home is subject to your approval. You retain control of this matter…In the event you do not wish to use a preferred vendor, we will review costing with one selected by you. If you do elect to use your own vendor for the emergencies or restoration, a proper scope of work has to be agreed to prior. [Emphasis added];

ii. On May 17, 2011, the adjuster wrote to advise the plaintiffs that it would be responsible for inviting contractors to bid on the work to be performed. Economical expressed its intention to “begin restoration as soon as possible”;

iii. The position of Economical changed in June of 2011. The plaintiffs were told they had to obtain their own expert and estimate instead of having the insurer assess estimates provided by their own contractors;

iv. On June 30, 2011, the plaintiffs were advised that Economical would not pay replacement costs for the entire buildings. Economical’s representatives said, even though the damages were created because of the wind, the scope of the damages was excluded by an exclusion in the policy dealing with “wear and tear”. The adjuster stated that there was a dispute about the extent of the damage caused by the wind and therefore what Economical is liable to replace;

v. On July 12, 2011, the adjuster wrote to follow up on the meeting of June 30, 2011. Economical presented an offer that reflected damage caused by wind alone and that, in their view, did not include any pre-existing wear and tear or deterioration;

vi. On July 25, 2011, the adjuster explained the business interruption coverage in great detail. A list of documents was requested in order to determine the business interruption loss;

vii. On December 22, 2011, the plaintiffs provided a Proof of Loss, which was supported by a bid summary prepared by Kocsis Engineering that outlined replacement costs. The adjuster requested that the plaintiffs re-file a Proof of Loss form that was reflective of actual cash values of the damage;

viii. On January 18, 2012, the adjuster sent a cheque to the plaintiffs in the amount of $130,735.01 for actual cash value, on a “without prejudice basis”;

ix. On March 28, 2012, Economical sent a cheque to plaintiffs in the amount of $29,218.25 for business interruption losses, on a “without prejudice basis”. Economical took the position that it would have taken two months to complete the repairs; thus, the maximum indemnity period for the business interruption claim was two months; and

x. On June 22, 2012, Economical wrote to counsel for the plaintiffs and stated that its valuation of the wind damage was $150,735.64. In light of the significant disagreement on quantum, Economical formally put the plaintiffs on notice of its demand for appraisal. Economical stated that it appointed Patrick Doherty to be their appraiser and asked that the plaintiffs appoint their own appraiser to initiate the appraisal process. The plaintiffs refused to take part in the appraisal process.

III. MATTERS IN DISPUTE

A. Replacement Cost of Buildings

15The parties agree that the plaintiffs are entitled to “replacement cost…without deduction for depreciation.” However, Economical states that the wind damage was limited to the roofs and thus they would only be liable for the replacement cost of the roofs. The plaintiff seeks the cost of replacing the entire buildings.

16The plaintiffs argue that they have complied with all of the requirements of the policy, including the statutory conditions, after the loss. They retained an engineer to assess the extent of the damage from the wind, prepared structural and other repair plans, and undertook a tender process for the cost of repairs. They submitted a Proof of Loss on December 22, 2011. They rely on their engineering report and take the position that the entire buildings were damaged by the wind.

17The plaintiffs intend to replace the buildings. The plaintiffs state that they are financially unable to pay for the repairs from their own resources and therefore require the replacement cost funds in advance of that construction.

18Economical states that the damage was limited to the roofs of the buildings, and therefore it is only liable for the repair or replacement of the roofs. Economical relies on the engineering report that states there was pre-existing damage not caused by the windstorms.

19Economical argues that the actual cost value is the basis of recovery under the policy until such time as the plaintiffs rebuild the damaged property. Economical will pay the actual cost value to provide funds to the insured to start the rebuilding process. The replacement costs will be paid during the ongoing construction process. Economical says that it has fully compensated the plaintiffs for the actual cash value of the roof.

B. Business Interruption Losses

20The plaintiffs submitted evidence of the business income loss of $374,883 by July 31, 2012 and more than $1.3 million by December 31, 2013. The business income losses included the costs of Agro’s Foods having to purchase mushrooms externally, decreased profits for loss of supply to third parties, and increased transportation costs. The plaintiffs state that, but for the wind, the plaintiffs would not have suffered these losses. Economical refused to pay those amounts (up to the policy limit amount of $250,000).

21Economical takes the position that the documents and calculations provided by the plaintiffs to establish their business losses were insufficient. Economical also states that the mushroom farm was not viable or capable of being operated prior to the loss.

IV. EVIDENCE

1. Evidence of Paul Kocsis

22Paul Kocsis (“Kocsis”) is a civil engineer who the plaintiffs retained to inspect and assess the extent of the structural damage that occurred as a result of the windstorms in 2011. The plaintiffs asked Kocsis to assess the cost of repair of the structures for purposes of an insurance claim on a replacement cost basis.

23Kocsis stated that the workmanship of the original structure met standard industry practice and complied with the building code at the time the buildings were designed and constructed in 1964 and 1977. Kocsis inspected the buildings for both deterioration and storm damage. Deterioration was limited and ruled out as the cause of the damage because he observed healthy rafters where wind damage occurred and/or damage that affected many different structural components over the entire roof area. Many of the rafters, which showed no sign of rot, had screw-type fasteners ripped out by the wind. The plaintiffs demonstrated an ongoing maintenance program to ensure that various components of the buildings were repaired or replaced on an as-required basis.

24Kocsis concluded that wear and tear, deterioration or latent defects played no role in the damage caused by the wind. Kocsis stated that the average total cost to repair or replace the buildings is $2,748,886.80 and that the wind caused the excessive damage.

2. Reports of Patrick Doherty

25Patrick Doherty (“Doherty”) is an engineer Economical initially retained to determine the extent of the damage to the buildings as a result of a severe windstorm and to determine their structural condition.

26Doherty stated that the windstorms damaged the roofing of the buildings. He noted that the concrete block walls are too high without lateral support and that many blocks were damaged from age and use. The rafter support beams are overspanned and some are broken. In some places, the rafters, strapping and bearing ends of support beams are in an advanced state of rot where foam insulation has been sprayed to the underside of the roof.

27Economical further retained Doherty to address the microburst/sudden downdraft theory that Kocsis had proposed in a report that was not filed. In a second report, Doherty stated that the microburst theory is not consistent with documented wind speeds and directions Environment Canada recorded on the days of the windstorms.

28It is notable that Doherty did not explicitly state that the wind only damaged the roof. In photos filed on this motion, there is evidence of horizontal and vertical cracks in the masonry walls in approximately six different locations of the buildings, as well as a bent window frame and a bent door frame. Doherty commented on one location where the top course of the concrete block has lifted, although he did not clearly state that the wind played a part in this damage. Doherty did not address the other cracks in the walls and the bent door and window frames. Doherty was also silent with respect to whether the plaintiffs are able to install a new roof on top of the current underlying structure and whether that structure would support the roof.

3. RWDI Report

29Economical also retained RWDI Consulting Engineers to address the microburst theory. RWDI provided the opinion that Kocsis misinterpreted the downburst or microburst theory. According to this report, the idea that the buildings were pressurized by a microburst from above is not in accordance with the physics of airflows.

30The RWDI report also commented on the wall pressure during the second windstorm. None of the estimated loads exceeded those specified in the 2010 National Building Code. However, some of the loads came close due to the internal pressurization of the buildings resulting from the wind getting into the buildings through the openings caused by the previous windstorm. It is unclear whether the fact that the buildings do not meet the 2010 Building Code may have affected this opinion.

4. Evidence of Lori Agro

31Lori Agro is an officer and director of the plaintiff companies. She provided evidence about the business of the plaintiffs, the windstorms, and the plaintiffs’ dealings with Economical. She also provided documents in support of the Business Interruption Loss claim. The calculations show the loss of gross profit due to increased cost to purchase mushrooms externally, sales lost from insufficient mushroom supply, and increased trucking costs to pick up mushrooms from other suppliers.

V. ANALYSIS

A. Summary Judgment

32The court shall only grant summary judgment if it is satisfied that there is no genuine issue requiring a trial. Pursuant to rules 20.04(2)(a) and (2.1) of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194, the court shall consider the evidence submitted by the parties and may exercise any of the following powers for the purpose of determining whether there is a genuine issue requiring a trial, unless it is in the interest of justice for such powers to be exercised only at a trial:

1. Weighing the evidence.
2. Evaluating the credibility of a deponent.
3. Drawing any reasonable inference from the evidence.

33In Hryniak v. Mauldin 2014 SCC 7, [2014] 1 S.C.R. 87, the Supreme Court of Canada clarified the test to apply on a summary judgment motion. There will be no genuine issue requiring a trial if the evidence permits the court to make a fair and just determination on the merits. This will be the case when a motion for summary judgment (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.

34What is fair and just depends on the nature of the issues, and the nature and strength of the evidence. There is an obligation on each party to “put its best foot forward.”

35Expert evidence assists the court to understand complex, technical issues. Determining complex issues by way of a summary judgment deprives the court of the opportunity to ask questions of experts who have fielded contradictory reports. When there are competing experts, summary judgment is typically not appropriate: George Westin Ltd. v. Domtar Inc., 2012 ONSC 5001, [2012] O.J. No. 4123 (S.C.), at paras. 88-89.

36Where summary judgment is refused or is granted only in part, the court may make an order specifying what material facts are not in dispute and defining the issues to be tried, and order that the action proceed to trial expeditiously. The court may impose terms and directions: Rules of Civil Procedure, rules 20.05.

37I am of the view that this is not an appropriate case for summary judgment. The factual issues cannot be determined without the court hearing viva voce evidence on the following issues:

i. Issue #1 For Trial: Replacement Value and Actual Cash Value

38It is not clear from Economical’s experts what their version of replacement value would be. It is also not clear whether it is even viable to simply repair the roof or whether it is necessary to take down the entire buildings.

39Economical initially insisted it must approve costs before any work was undertaken and that it would get contractors to do the work. Economical now says that the property must be replaced before the plaintiffs can receive replacement costs. In my view, where there is such a large disagreement regarding the value of the loss, Economical cannot require the plaintiffs to rebuild without some assurance that there is some agreement on the value of the loss. It is most appropriate to determine the scope of damage caused by the wind before requiring the plaintiffs to rebuild.

40The plaintiff cannot avoid the requirement to rebuild by claiming that they are unable to refinance the replacement without payment by the insurer under the policy: Laurentian Village Ltd. v. Chateau Insurance Co., [1982] O.J. No. 2539 (H.C.J.), at para. 30. However, it would also be unreasonable to have them embark on a $2.5 million contract without an agreement as to the amount that the insurer will pay.

41The cause of the loss should be determined by looking at all the events which give rise to it and asking whether it is fortuitous in the sense that the loss would not have occurred “but for” or without an action that was unexpected: C.C.R. Fishing Ltd. v. British Reserve Insurance Co., 1990 CanLII 145 (SCC), [1990] 1 S.C.R. 814, at p. 825-826.

42Economical inspected the buildings three years before the loss and satisfied itself with respect to the reasonable condition of the buildings and the adequacy of ongoing maintenance. Even though the buildings were older, Economical chose to insure those buildings and assume that coverage. This was a risk that the insurer chose to take. It charged a premium for replacement cost coverage.

43There is a disagreement over the interpretation of the wear and tear exception in the policy and the extent to which that interpretation affects the calculation of the replacement cost. The reports of the experts conflict as to replacement value of the buildings, and that conflict appears to originate from the experts’ interpretation of whether the loss was caused by the wind or wear and tear. On the evidence before me, I cannot determine what should be excluded because it pre-existed the windstorms or what damage exists as a result of the windstorms. Determining this issue will require close examination of the expert evidence together with the policy as it applies to the facts of this case.

44In light of the significant disparity regarding the replacement costs, I find that it is appropriate for this court to determine the value of the replacement cost before the plaintiffs are required to rebuild. Once the value is determined, the plaintiffs must still rebuild before they are entitled to receive the replacement cost value from Economical. If the plaintiffs choose not to rebuild, they will only be entitled to actual cash value of the damage. It is therefore appropriate for this court to determine actual cash value, in the event that the plaintiffs do not rebuild or repair the buildings.

ii. Issue #2 For Trial: Business Interruption Losses

45A key feature of the business interruption losses is the indemnity period. If the court accepts Economical’s position as to the extent of damage, the period of time is substantially less. But if the court accepts the plaintiffs’ position that the buildings need to be rebuilt, there would be a longer indemnity period for business losses.

46I accept Ms. Agro’s evidence that mushrooms would have been harvested commencing in August 2011. The calculation of the business interruption losses after that date is, to some extent, dependent upon the court’s finding as to the extent of the damage caused by the wind. This issue must therefore be addressed at trial.

47Economical says that the documents establishing business interruption losses are not satisfactory. This is an appropriate case for the court to hear viva voce evidence explaining the documents that support the calculations.

B. Claims for Special Damages

48An insurer has a duty of good faith that requires it to deal with a claim fairly, both with respect to the manner in which it investigates and assesses the claim and to the decision whether or not to pay it: Fidler v. Sun Life Assurance Co. of Canada, 2006 SCC 30, [2006] 2 S.C.R. 3.

49In the case before the court, the evidence does not establish that Economical failed to act honestly and in good faith. Economical made two payments to the plaintiffs on a without prejudice basis. Due to conflicting engineering reports, it cannot be said that Economical took an unreasonable position on coverage. No punitive, exemplary or other special damages have been established.

C. Claim for Declarations for Future Orders

50In its summary judgment motion, the plaintiffs seek a declaratory order to permit them to come back to the court to obtain further relief in the future. There is no basis to grant such an order in this case.

D. Appraisal Process

51The parties disagree as to whether the appraisal process term is applicable to all perils and whether it is an appropriate mechanism to deal with the dispute in this case. Economical seeks to invoke the appraisal process to determine the quantification of windstorm damage.

52The plaintiffs argue that the ability to demand an appraisal is not applicable to wind as an insured peril. The plaintiffs further state that this dispute falls outside the jurisdiction of an umpire, whose authority is to value the property insured. The umpire is not empowered to decide a dispute over coverage or exclusions to coverage. The cause and scope of the loss and the basis upon which it is to be paid, not simply the valuation of the loss, are in issue in this action.

53The insurer may adopt the appraisal process as a mechanism for resolving any disagreement by expressly stating so in the contract of insurance. Section 128 of the Insurance Act governs the appraisal process. The appraisal is an efficient method to resolve valuation issues between the insurer and the insured, largely due to the efficiency and cost-effectiveness it can provide. Courts should not be overly eager to interfere in the operation of the section.

54The parties disagree about the interpretation of the policy and whether the appraisal process can be invoked for damages caused by wind. It is therefore necessary to examine the wording of the policy. Where a contract is clear and unambiguous on its face, it is unnecessary to consider extrinsic evidence in order to interpret its terms. Courts should give effect to clear and unambiguous language in an insurance policy, having regard to the contract as a whole: Dunn v. Chubb Insurance Co. of Canada, 2009 ONCA 538, 2009 ONCA 2726, [2009] O.J. No. 2726, at para. 33.

55In the case before the court, the policy clearly states that Statutory Condition 11 (including the appraisal term) applies to all perils. I find, therefore, that the appraisal term applies to damage caused by wind.

56The appraisal process assesses the value of the property saved, the value of the property damaged and the extent of the property damage. All other issues are reserved for settlement by negotiation or for determination by litigation in an ordinary action. Legal issues are not within the jurisdiction of appraisers and the umpire to resolve. This includes disputed legal issues which relate to “value”: Shinkaruk Enterprises Ltd. v. Commonwealth Insurance Co., 1990 CanLII 7738 (SK CA), [1990] S.J. No. 317 (C.A.).

57The umpire in an appraisal process is not required to hold “a fair hearing” and hear evidence, argument of counsel or any of the trappings that one would associate with the arbitration process: Re Krofchick v. Provincial Insurance Company (1978), 1978 CanLII 1304 (ON SC), 21 O.R. (2d) 805 (Div. Ct.). They are permitted to hear viva voce testimony under oath and receive affidavit evidence, but they are not required to do so.

58In the case of Ferrier v. Maplex General Insurance Co., 1991 CanLII 170 (B.C. S.C.), there was a serious dispute about quantities of leasehold improvements, equipment and stock in the possession of the insured at the time of loss. The insurance company denied the claim, and took the position that the insured did not possess or own most of the items claimed. The appraisal process was commenced, but concerns were raised regarding the umpire’s authority to conduct a hearing to consider the methods of calculating the loss.

59In Ferrier, the court held that the question of quantity and the interpretation of the reference to valuation in the insurance contract were matters for the trial judge. The court further held that it offended the concept of a fair hearing to permit an inquiry to proceed that has no right to counsel, no right to cross examine or any of the usual safeguards available to parties. If there are disputes about quantities or methods of calculation, appraisers are to determine the value but it is for the trial judge to decide the issues.

60The appraisal process is not a bar to the institution of legal proceedings, nor does it give rise to a stay of proceedings: David v. Canadian Northern Shield Insurance Co., 1994 CanLII 1515 (B.C. S.C.).

61In Rilkoff v. Portage LaPrarie Mutual Insurance Co., 2005 SKQB 54, at para. 16, the court held that the appraisal process cannot determine whether damage pre-existed a storm. The expertise of the appraisers in the area of values will only be of assistance after it has been determined whether coverage for the property damage resulted from an insured risk, or whether it existed prior to the storm by virtue of faulty construction. In those circumstances, the appraisal process will not achieve its objective of a quick settlement of the insured’s loss and the action should therefore be permitted to continue.

62On the summary judgment motion, I have found that there is a genuine issue requiring a trial. Having received conflicting expert reports, I am unable to determine the extent of the damage caused by the wind without hearing viva voce evidence. The determination of this factual issue is intertwined with the legal issue of interpretation of the policy, namely to what extent parts of the damaged property are excluded under the Replacement Cost provisions due to pre-existing wear and tear, deterioration and/or design defect.

63I find that the appraisal process is not suitable for determination of the property damage and business income loss caused by the windstorms. It would offend the concept of a fair hearing to permit an inquiry to proceed that has no right to counsel, no right to cross examine or any of the usual safeguards available to parties. In addition, an umpire at an appraisal process does not have jurisdiction to determine policy interpretation issues. Finally, the umpire in an appraisal has no jurisdiction to deal with the business interruption losses; therefore it is more appropriate for the court to deal with these related issues together at trial.

VI. CONCLUSION

64There is contradictory evidence before the court as to whether the windstorms caused damage to the entire buildings or just to the roofs. There is conflicting evidence about which parts of the building require repair or replacement solely as a result of deterioration or inadequate maintenance by the plaintiffs, which is not covered under the policy.

65With respect to the business interruption losses, the calculation of these losses will be partially dependent on this court’s finding regarding whether the plaintiffs are entitled to replacement cost or actual cash value for the entire buildings. The appropriate length of the indemnity period is partially contingent upon the determination as to the scope of the damage to the buildings and whether it is even possible to build a new roof on the remaining walls.

66I find there is a genuine issue requiring a trial, and I direct that this action proceed to trial before me expeditiously with evidence on the following issues:

a) The scope of the damage caused by the wind (including the replacement cost and actual cash value of that damage) and the appropriate length of the indemnity period for business interruption losses. This shall be limited to the viva voce evidence of Kocsis, Doherty and/or a representative of RWDI.

b) A valuation of business interruption losses. This shall be limited to the viva voce evidence of Lori Agro or an accounting expert.

67At the trial, the affidavits and any other evidence filed on the motion and any cross-examinations on them may be used in the same manner as an examination for discovery.

68The experts engaged by the parties shall meet prior to trial, on a without prejudice basis, and are directed to do the following:

i. Identify the issues on which the experts agree and the issues on which they do not agree;

ii. Attempt to clarify and resolve any issues that are the subject of disagreement; and

iii. Prepare a joint statement setting out the areas of agreement and any areas of disagreement and the reasons for it.

69The expert evidence goes to the very issue that is in dispute in this case, namely the extent of damage caused by the wind. In my view, the cost and time savings or other benefits that may be achieved from an expert meeting are proportionate to the importance of the issues involved in the case. Clarification on areas of disagreement would assist the court. Each party shall bear their own costs of this process.

70This court further orders that counsel attend before me, within the next 60 days, to address the following:

i. Timelines for the trial, including time estimates and target dates for trial;

ii. Timelines for the filing of a report following the meeting of the experts;

iii. Timelines for the parties to deliver a concise summary of his or her opening statement;

iv. To determine which affidavits or other evidence filed on the motion, and any cross-examinations on them, may be used at trial in the same manner as an examination for discovery; and

v. Whether the court should make any other order under Rule 20.05(2).

71Costs of the summary judgment motion are reserved until the completion of the trial.

Braid, J.