Where a squirrel found its way onto a power station’s electrical transformer triggering an electrical arc that killed the squirrel and caused damage to the municipality’s property of $213 524, the court denied the municipality all-risks insurance cover because of an exclusion for ‘loss caused by arcing or by electrical currents other than lightning’.

The court found that the loss was caused by arcing even though something else (ie the squirrel) triggered the arcing. This is not a situation where two independent causes (one covered and one excluded) may have contributed to the loss. The efficient proximate cause doctrine is only applicable where the causes are independent. The squirrel did not independently contribute to the loss other than through the arcing. The squirrel by itself did not cause any damage as a separate proximate cause.

This analysis of the proximate cause test is similar to the analysis that a South African court should apply.

The case is City of West Liberty v Employers Mutual Casualty Co.