A BC Court of Appeal judge has sided with a man who previously had an insurance claim denied due to a small, legal cannabis grow site in his home. 

In a ruling posted on March 14, 2025, the judge found that a previous court decision that sided with the man’s insurance company was incorrectly interpreted, allowing the appeal. 

The man had appealed an order of the Supreme Court of British Columbia from 2021 (Busato v. Gore Mutual Insurance Company) that denied his coverage after a 2017 kitchen fire that was unrelated to his cannabis grow operation.

The appellant, Anthony Busato, lost his home in Peachland, BC, to the fire. A claim he made to his insurance provider, Gore Mutual Insurance Company, was denied due to the discovery by the insurer that the man was growing approximately 25 cannabis plants in his home.

Although the plants were authorized under a licence from Health Canada and he had been insured by Gore since 2014, the insurance provider denied his claim for compensation for his loss. Gore, in their denial, pointed to an exclusionary clause in the policy that did not allow cannabis cultivation on the property. 

Busato sued his insurer, but the judge in the case sided with the insurance company. In the appeal, the new judge ruled that the first judge erred in their ruling, saying it was based on a previous court case, which the appeal judge said was not relevant as they dealt with illicit cannabis production. The first of those cases involved the illicit production of cannabis extracts rather than a legal, licenced medical grow operation, while the second dealt with a 300-plant operation that the owners made efforts to hide. 

Busato made no such efforts to hide his small grow operation. In addition, even after denying his claim for a supposed breach of policy, Gore did not cancel Busato’s policy and continued to collect payments. 

“Since the appellant’s cultivation was not illegal nor did it create unusual risks, the appellant could reasonably expect the exclusion did not apply,” wrote the Honourable Justice Winteringham, in part, in their decision. “I accept that the appellant did not give evidence about his expectations but it is reasonable for an insured party to expect that an exclusion, which is drafted in a way that targets illegal activity, would not apply to their legal use of property.”

“The appellant was using medicinal marijuana to relieve chronic and debilitating pain experienced following back surgery,” the judge continued later in his ruling. He sought and obtained a license that permitted him to grow up to 73 marijuana plants. He had 25 plants at the time of the fire. While not determinative, the cause of the fire had nothing to do with his marijuana plants, as the trial judge found, and there was no suggestion that the appellant misled or misrepresented the insurer in any way. Further, the judge relied heavily on the underwriter’s evidence from an Ontario case where the same exclusion was at issue in different circumstances. In my view, these circumstances support a finding that it would be unjust or unreasonable to give effect to the exclusion.”