Articles

Drawing a Line on the Duty to Defend: When are Insurers Required to Contribute?

By Herman Khangura, J.D., B.A.

In 2024, Ontario’s top court revisited an insurer’s duty to defend its insured when multiple policies are available to respond. The Ontario Court of Appeal (“ONCA”) reviewed the role of non-concurrent insurers and pushed back on coverage overreach. Two recent decisions – Loblaw Companies Limited v. Royal & Sun Alliance Insurance Company of Canada[1] and Live Nation Ontario Concerts GP, Inc. v. Aviva Insurance Company of Canada[2] – were released within months of each other and, although factually distinct, share some common themes.[3] The two cases emphasize the primacy of pleadings, the inviolability of policy structures (such as self-insured retentions), and the limits on equitable contribution among insurers.

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Distinguishing Between Coverage Assessment and Loss Assessment in Insurance Disputes

July 2024

In first-party insurance disputes, particularly those involving significant damage amounts, it is crucial to differentiate between assessing coverage and assessing the amount of the loss. This distinction was at the heart of a case involving Aviva Insurance Company and the respondents’ dentistry practice,[1] ultimately shaping the judicial outcome.

[1] Aviva Insurance Co. of Canada v Freedman, 2024 ONSC 2886 [Aviva Insurance].

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Annapolis Group Inc v Halifax Regional Municipality, 2022 SCC 36 – A new chapter on de facto Expropriation?

By Harrison Neill-Morabito and Rory Barnable, Barnable Law P.C.

February 2023Expropriation has been described as the “forcible acquisition by the Crown of privately-owned property, for public purposes”1 and as an “ultimate exercise of governmental authority.”2 Described like that, it is not surprising that there is a rich history of caselaw concerning the exercise. Most recently, in October 2022, the Supreme Court of Canada (the “SCC”) released its decision in Annapolis Group Inc v Halifax Regional Municipality, reconsidering the test for de facto expropriation, also known as constructive taking.

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Insurance Coverage Update: Competing “Other Insurance” Clauses

October 2021

Other Insurance clauses are a common feature of insurance policies. However, they do not all contain the same wording. When losses arise, and an insured has several insurance policies potentially responding, the “other insurance” clauses from policy to policy can be in conflict, and essentially “compete” to determine which policy ought to respond first. These exciting competitions infrequently make their way to a court, and so are noteworthy when they do.

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Note to Insurers: Choose your Position, and Tell your Insured

March 2019

The recently released case of Demetriou v AIG Insurance Co of Canada, provides further insight on insurer conduct that can attract punitive damages. Following an insurers denial of a claim for a stolen ring, Justice Gray granted the insured plaintiff summary judgement and awarded $50,000 in punitive damages against the insurer.

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Waiver of Subrogation in Builders Risk Policies

November 2018

An insurer cannot subrogate against its own insured. Litigants have tested this well-known bar to subrogation since the s.s. Fitzmaurice struck and sunk the s.s. Dunluce Castle, and the latter’s underwriters tried to recover against the former’s owner, although he owned both vessels. Despite a long history, cases still arise that explore its limits. In particular, actions involving construction projects often address subrogation given the involvement of insured owners, contractors, subcontractors, builders risk policies and property insurers.

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Canadian Transport Lawyers Association – AGM & Educational Conference 2018

October 2018

The following is prepared as part of a panel presentation reviewing recent cargo cases. In addition to involving cargo, the cases below also share a common theme – invoking certain procedures to dispose of claims before the conclusion of trial. While summary judgment motions may represent the most commonly-known method of disposing of a matter prior to trial, only one of these cases involved a summary judgment motion. In two other cases, the claims were struck due to the Federal Court’s lack of jurisdiction. Finally, a recent cargo decision presents as a rare example of a motion for non-suit.

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Insurers Over-Zealously Fighting Fraud Could Face Punitive Damages

April 2018

Last month, March 2018, was the 14th annual Fraud Prevention Month, an education and awareness campaign focusing on fraud recognition and reporting. Throughout the month, media reports circulated on how susceptible the insurance industry is to fraud. The Insurance Bureau of Canada reported that auto insurance fraud costs Ontario drivers an estimated $1.6 billion each year (translating to approximately $236 of an individual’s auto insurance premium), while the insurer Aviva reported that its recent investigation into auto repair fraud confirmed that certain Ontario auto body shops were falsely inflating damages and repair costs to automobiles, costing consumers approximately $547 million annually.

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Recent Cases Interpreting Insurance Exclusions: While policies may be “standard-form”, disputes over interpretation continue

September 2017

Insurance coverage jurisprudence has its share of general principles. Lawyers even remotely familiar with the area may eagerly recite phrases like “contracts of adhesion”, they may expound that “coverage is interpreted broadly while exclusions are interpreted narrowly”, or perhaps at the opportune moment they may even throw out a “contra proferentem”.2 Insurance “generalities” are so reliable that in Ledcor Construction Ltd. v Northbridge Indemnity Insurance Co., 2016 SCC 37 the Supreme Court of Canada assured us that parties interpreting insurance policies should resort to the general rules of interpretation that apply to insurance policies, adding further that appeal courts ought to apply a correctness standard of review as insurance policies constitute standard-form contracts not normally subject to negotiation. But although insurance coverage cases have generated well-established principles of interpretation, various cases within the last year confirm that the current state of the law does not provide all the answers or foreclose on future insurance coverage litigation.

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When does an Auto Policy end? Perhaps not when you think…

March 2017

In Echelon General Insurance Company v. Her Majesty the Queen, 2016 ONSC 5019 Justice Matheson of the Ontario Superior Court clarified that in order to formally terminate a policy of auto insurance an insurer must comply with the notice obligations contained in section 236 of the Insurance Act, rather than merely allowing the policy to lapse.

In this instance a Policyholder had a six month auto policy with Echelon General Insurance Company. Shortly after the policy commenced, Echelon sent a letter to the Policyholder purporting to cancel the policy due to non-payment of a premium. Echelon received no response, and there was no further communication between it and the Policyholder. Approximately a year after the end of the six month term, the Policyholder was involved in an accident when he struck a pedestrian. The central question of this case was whether the auto policy was still in force at the time of the accident so as to provide coverage for accident benefits to the claimant.

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Case Analysis: Ledcor Construction Ltd v Northbridge Indemnity Insurance Co., 2016 SCC 37; Standard Form Contracts and Faulty Workmanship

October 2016

The Supreme Court of Canada recently released its long awaited decision in Ledcor Construction Ltd v Northbridge Indemnity Insurance Co., 2016 SCC 37 (“Ledcor”). The case is important for at least two reasons: first, the case is a significant decision concerning the proper standard of review for courts asked to interpret standard form contracts. In this decision, the SCC confirmed that interpretation of standard form contracts is often a question of law, and so the standard of review of standard form contracts ought to be correctness. In this manner the SCC endorses the precedential value that a consistent interpretation presents, while suggesting that the “factual matrix” surrounding the particular usage of standard form contracts will generally be less impactful.

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Transformative Technologies: Regulating Autonomous Vehicles

June 2016

This article addresses the potential changes that autonomous vehicles (“AVs”) will necessitate for current transportation regulatory and liability regimes. The future introduction of AVs requires adaptations for legislative and insurance regimes on a massive scale and has the potential to rewrite present methods of risk allocation in the affected industries. This article will appeal to those with interests in infrastructure and transportation; as the AV – and as an expansion of the “internet of things” – presents a convergence of these fields.

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What Determines the Contract of Carriage

May 2016

The rights of parties in shipping arrangements are defined through what is known as contracts of carriage. Such contracts encompass the terms and conditions of the shipment between those involved in the shipment of goods, for instance. Frequently in the carriage of goods context, the tendency is to simply refer to the bill of lading as governing all terms of carriage. Indeed, provincial regulations (in most provinces) deem to incorporate certain uniform terms and conditions into bills of lading, and thus into contracts of carriage. In this manner the bill of lading does frequently represent the best evidence of the parties’ intentions and their contract of carriage.

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Drawing a Line on the Duty to Defend: When are Insurers Required to Contribute?

Distinguishing Between Coverage Assessment and Loss Assessment in Insurance Disputes

Annapolis Group Inc v Halifax Regional Municipality, 2022 SCC 36 – A new chapter on de facto Expropriation?

Insurance Coverage Update: Competing “Other Insurance” Clauses

Note to Insurers: Choose your Position, and Tell your Insured

Waiver of Subrogation in Builders Risk Policies

Canadian Transport Lawyers Association – AGM & Educational Conference 2018

Insurers Over-Zealously Fighting Fraud Could Face Punitive Damages

Recent Cases Interpreting Insurance Exclusions: While policies may be “standard-form”, disputes over interpretation continue

When does an Auto Policy end? Perhaps not when you think…

Case Analysis: Ledcor Construction Ltd v Northbridge Indemnity Insurance Co., 2016 SCC 37; Standard Form Contracts and Faulty Workmanship

Transformative Technologies: Regulating Autonomous Vehicles

What Determines the Contract of Carriage

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