Great Northern Brewing Co. has canceled the annual Beer Barter planned today during the Whitefish Winter Carnival because of insurance issues.

The cancellation of the popular event follows a brouhaha over the brewery being allowed to hold the event in the first place.

The city of Whitefish initially denied a special event permit because the outdoor arena for the Beer Barter in past years hasn’t been properly controlled and carnival-goers walked along Central Avenue with open containers of beer.

Great Northern Brewing appealed the permit denial to the City Council and won approval on Monday, although council members made it clear the event would have to be better controlled.

Brewery Manager Marcus Duffey notified the city just before noon on Friday that he was withdrawing the permit application and canceling the Beer Barter.

Whitefish City Manager Chuck Stearns said that despite working in good faith with the city, Duffey could not get insurance coverage to meet the city’s requirements for insurance and indemnification. The council imposed the requirement as one of 10 conditions when they approved the permit.

“Mr. Duffey was willing and able to meet the other nine conditions,” Stearns said. “Both parties are disappointed that their efforts to reach agreement were unsuccessful.”       

Duffey, his insurance agent and his attorney worked with Stearns and City Attorney Mary VanBuskirk to draft language that would work for both parties and meet the requirements imposed by the council.

Stearns noted that indemnification and insurance are important requirements when a major event selling alcohol occurs on city right of way, in this case Central Avenue, because the city could incur some liability from such an event.

“All such liability should rest with the event sponsor, not the city’s taxpayers,” Stearns said.     

State law requires an event sponsor to control the premises where alcohol is consumed and sold. Duffey had admitted that past Beer Barter events did not have sufficiently controlled premises resulting in open containers of beer in other areas of downtown.

The Beer Barter, a competition that allows contestants to offer outrageous barter proposals in exchange for a year’s supply of Great Northern Beer, was in its fourth year and was expected to draw about 1,000 spectators today.

The Winter Carnival wraps up today with the parade at 3 p.m. and other festivities.

Great Northern Brewing Co. said in a brief statement that despite the cancellation of the Beer Barter, the brewery will still celebrate its 19th anniversary today with a party that starts at noon.