SWG ENVIRO – From Cold To Mould: How Construction Contractors Can Prevent Environmental Pollution This Winter

Nov 2020

In November 2019, a couple launched an $11-million lawsuit against a Calgary home builder after they claimed leakage and mould issues contributed to the death of their 24-year-old daughter and left them feeling unsafe.

The couple’s daughter died after suffering an asthma attack in her room in December 2018. The family filed a claim against the home builders alleging negligence and breach of contract in construction. They also alleged improper building of their home resulted in water leaks and mould, which contributed to the death of their daughter. According to CTV News, their claim alleges the company “knew or ought to have known that there was a high-water table in the area but did not install sump pumps,” used negligent “building design” and “sealing of the exterior foundation walls” and “intentionally or unintentionally failed to provide mould reports to the Plaintiff and/or Class members.”

A mould report cited in the court documents indicated the spore count in the family’s home was “400 times above” acceptable levels. (1)

Mould is a common issue leading to lawsuits in this industry, and though mould problems peak in the spring and summer months, they can also develop in winter. As construction projects continue into the winter season, contractors should be aware of their liabilities to help ensure their current insurance policies offer them sufficient coverage. This article will explain why and how contractors can mitigate environmental and legal issues – this winter and beyond.

How Mould Problems Begin – And Who’s Responsible

Construction projects are susceptible to incidents of mould growth primarily because of uncontrolled moisture buildup in the form of:

  • Liquid flow,
  • Condensation,
  • High humidity, and/or
  • Capillary action that dampens building materials

Once building materials become wet, mould growth can start in as little as 24 to 48 hours. That is why routine inspections for moisture incursion and a quick response are necessary.

According to 1Source Safety and Health Inc., some of the biggest culprits during construction include:

  • Design Issues:Design flaws or construction defects that allow moisture incursion.
  • Product Issues:Primarily wood members with “lumber yard” or sap-stain molds.
  • Site Issues:Poor site drainage, inadequate building protection, water buildup in basements and crawl spaces, and stored building materials that get wet.
  • Procedural Issues:The “shrug it off and build it” mentality when moisture incursion occurs. (2)

So, who is responsible when a construction project results in mould incursion? There is a joint responsibility on the part of the designers, the builders, and the operators/owners to prevent the conditions that lead to a contaminated site. The failure of any stakeholder to exercise due diligence may result in the inherent loss of use, costly remediation, and possible long-term litigation.

A Team Effort: Incorporating Mould Prevention Into Construction Projects

The key to dealing with mould, and with the increasing public concern and negative publicity surrounding the issue, is to prevent it.

Knowing where and how mould develops

Mould requires three key components to survive:

  1. A nutrient source, or growth medium
  2. A source of moisture
  3. The proper environmental conditions (e.g., temperature)

For example, many construction materials contain enough organic material to cultivate mould when wet and within the optimal temperature range. Wet paper used in gypsum wallboard and other materials with a high cellulose content are prime territory for mould growth.

Proper design, material handling and craftsmanship

Not all contractors operating in the design-build sector have an in-depth knowledge of proper design principles, and builders certainly should not carry the entire responsibility for mould prevention for a project with multiple stakeholders. Nevertheless, builders should still be aware of the importance of proper HVAC design, architectural detailing, and the selection of suitable systems and materials towards the prevention of mould in a building.

Building operators should establish maintenance and inspection guidelines for the mitigation and early detection of mould.

Project or construction managers should carefully consider the timing and scheduling of their projects, and advise the owner of any increased risks due to changes in the schedule. They should also inform the client that construction during damp or rainy seasons could result in the exposure of building materials to moisture, and thus increase the potential for mould growth.

Last but not least, construction contractors should follow approved methods, procedures and scheduling best practices to minimize the potential for mould growth. For example, contractors should reject wet or mouldy materials, prevent the exposure of clean/dry interior building products to exterior conditions, protect stored/staged materials from moisture and minimize moisture accumulation in built spaces. Contractors should also have written plans in place, prepared in consultation with the design team, to prevent water from spilling or accumulating in the building.

Monitoring after the construction phase

Once the building has been completed and prior to occupancy, the contractor should have a plan in place to control the balance of thermal comfort and relative humidity in the building. During the commissioning and handover stages, contractors should conduct ongoing monitoring and inspections of the installations to ensure no water intrusion and that all areas remain clean and dry. This should include a final check of the HVAC system after it has been running in a balanced condition. (3)

SWG ENVIRO: Unique Insurance For A Complex Project-Based Industry

SWG ENVIRO Contractor’s Environmental Liability – Annual & Project Specific policy addresses the risk of pollution arising from annual and project-specific contract work. Coverage is provided on a claims-made and reported basis.

Coverage highlights:

  • Contractors Environmental Liability:

○ Sudden and gradual pollution events

○ Broad definition of pollutant including asbestos & mould

○ Clean-up costs

○ Restoration costs

○ Emergency response costs

○ Natural resource damages

○ Compensation for third party bodily injury and property damage

○ Civil fines and penalties

○ Punitive damages, where insurable by law

○ Legal defense costs

○ Completed operations

○ Automatic coverage for contractors’ clients, if cover is required by contract

  • Coverage Enhancements:

○ Retroactive cover for historic work

○ Transported cargo

○ Waste disposal / Non-owned disposal sites

○ Separate project-specific limits

We Cover:

Includes but not limited to the list below. Contact us if you don’t see what you’re looking for.

  • Asbestos & mould abatement
  • Construction management
  • Demolition
  • Dredging
  • Drilling
  • Environmental, including remediation
  • Haulage
  • Landscaping
  • Oil and gas
  • Plumbing
  • Restoration
  • Septic tank installation and maintenance
  • Utility operation and maintenance
  • Waste collection, transportation, and treatment

For more information about our policy features, visit our website.

Content is current as of the date of broadcast and is subject to change without notice.


  1. https://calgary.ctvnews.ca/lawsuit-filed-against-calgary-homebuilder-alleges-mould-contributed-to-24-year-old-s-death-1.4800595
  2. https://www.1ssh.com/news/causes-of-mold-during-construction-prevention-measures-nwmft_95.aspx
  3. https://www.cca-acc.com/wp-content/uploads/2019/02/Mould-guidelines2018.pdf