When hitmen attempted to murder a lawyer for her work exposing conspiracies to commit insurance fraud, her law firm’s business collapsed. The threat of the hitmen returning meant that the firm’s office was no longer safe. The firm’s insurer clients withdrew out of fear they might also be targeted. Compounding the firm’s problems, the firm’s insurance provider refused to indemnify the firm for their loss of income beyond the brief period it took to repair the bullet holes in the office.
In Carr Law P.C. et al. v. Certas Home and Auto Ins. Co., 2026 ONSC 2203, the Ontario Superior Court ruled that the law firm (“Carr Law”) was entitled to be indemnified by the insurer (“Certas”) for Carr Law’s income loss due to the total shutdown of the firm’s business. Under their insurance policy, Carr Law’s entitlement to coverage for lost business income was not limited to the period of a few days that it took to repair the physical damage to their office. The Court grappled with the extent of coverage an insured party is entitled to on account of the loss of income they suffered as a consequence of an organized criminal effort to shut down their business.
The Attack
Carr Law had a history of success defending insurance companies against fraudulent automobile collision claims. The ring of Toronto-based tow truck businesses that was responsible for the fraud decided to shut down Carr Law by any means necessary.
The criminal network began by sending men to light Carr Law’s office on fire, twice. Then in August 2019 they sent a hitman to murder Lisa Carr, the lawyer responsible for exposing the fraud. Lisa Carr miraculously survived because the hitman’s gun jammed when he pulled the trigger.
A few days later a second gunman showed up at Carr Law’s office to threaten an associate lawyer with being killed if she did not stop suing his “friend.” In September 2019 the second gunman opened fire at the office’s glass doors, which shattered the glass.
The Business Collapse
In the aftermath of the September 2019 shooting, Lisa Carr and her husband went into hiding. To protect herself and the lives of Carr Law’s staff from the threat of another shooting, Lisa Carr tried to operate Carr law remotely.
However, this effort failed because Carr Law’s insurer clients all stopped doing business with Carr Law for fear they could be targeted by gunmen. The two gunmen who went to Carr Law’s office were eventually arrested, but the leaders of the criminal network that sent them remain at large. Despite her efforts, Lisa Carr failed to rebuild Carr Law’s practice.
The Insurance Claim
Carr Law had purchased an insurance policy from Certas that provided coverage for damaged property and coverage for up to 12 months of business income lost as a result of the insured property damage. Carr Law claimed $5,285 for the cost of replacing the glass doors and $1.4 million for its lost business income in the 12-month period following the September 2019 shooting. Certas paid the full claim for the cost of replacing the doors but only agreed to cover business income losses during the few days it took to replace the glass door.
The parties’ dispute centered on the clause in the insurance policy that laid out Carr Law’s entitlement to coverage on account of lost business income:
“…in the event that the business of the Insured is interrupted as a result of a direct physical loss or damage from an insured peril, the Insurer shall pay the Insured the actual loss of "business income"…”
Carr Law argued that the total shutdown of their business was the result of the damage it suffered from the gun attack. Certas argued that after the glass door was replaced, the only reason Carr Law’s business remained shut down was due to the threat of another shooting. According to Certas, the policy did not cover business income that was lost as a result of a business shutting down because of the fear of potential future damage or attack.
The Court’s Decision
The Court’s analysis centered on the meaning of “as a result of.” The Court explained that in an insurance context, the phrase “as a result of” does not require that an insurable event be the direct cause of a loss. Unlike the phrase “as a direct result of”, which does require direct causation, “as a result of” allows coverage for losses that arose because of the same circumstances as an insurable event.
The Court applied this reasoning to Carr Law’s situation. It determined that the same spray of bullets that destroyed the glass door also caused the total shutdown of Carr Law’s business. The fact that the mass withdrawal of Carr Law’s clients occurred in the aftermath of the gun attack against Carr Law’s office indicated that the gun damage to Carr Law’s office caused the shutdown of Carr Law’s business. The Court determined that the lower causal requirement established by the phrase “as a result of” obviated the need to prove the gun damage directly caused the shutdown of the business.
Conclusion
The Court’s decision highlights the importance of the specific language used in insurance policies. Courts will often avoid imposing a more restrictive reading of a policy if the language it uses allows broader coverage for the insurance claimant. This is especially true in cases like Carr Law, where the Court is asked to interpret an insurance policy’s insuring agreement.
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