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Court Finds TD Insurance has a Duty to Defend

Thursday, October 6th, 2011

The Applicant, Damon Tedford, had a liability insurance policy with the Respondent TD Insurance which provided him with coverage for “bodily injury” claims made against him.  He was sued based on certain representations he made on a seller property information sheet when he sold property in the City of Ottawa.  In the action, the Plaintiff purchaser claimed both property damage and bodily injury resulting from allegations of negligent misrepresentation, breach of contract, and negligence.

TD Insurance argued that, since the main thrust of the litigation and the primary claim related to economic loss, coverage under the policy was not triggered.  On a duty to defend application, Justice Kealey of the Ontario Superior Court found otherwise.

A liability insurance policy imposes two obligations on the insurer:

  1. To provide the insured with a legal defence in any action brought against the insured for matters that are within the coverage provisions of the policy; and
  2. To indemnify the insured for any amount that he is called upon to pay if he is found liable to the claimant.

There is a great deal of case law supporting the proposition that the insurer’s duty to defend is broader than the duty to indemnify.  If the policy imposes a duty on the insurer to defend some (or even only one) of the claims made against its insured, there will usually be a duty to defend the entire action.  This is the case even when the causes of action that are alleged to be covered are only potentially within the coverage provisions.

Since the policy clearly provided coverage for bodily injury claims, the court found that TD Insurance had to defend Mr. Tedford in the action that had been brought against him by the purchaser.

Link: Tedford v. T.D. Insurance, CanLII – 2011 ONSC 5500 (CanLII)

Richard Hayles, B.A., J.D.

Insurance and commercial litigation lawyer

 

Brief informational summaries about commercial and other litigation matters in the courts of Ontario and other developments are periodically published on this website. They are intended to be a general comment or general discussion, not legal advice and should not be relied upon as legal advice. Should you require legal advice, please contact info@heydary.com or 416 972 9001.

Posted in Civil Litigation, Insurance, Litigation Law | Add Comment »

Defendant Gets Summary Judgment in a Motor Vehicle Accident Case

Thursday, August 25th, 2011

Guo v. Simpson seems like the classic car accident case in which vehicles collide in an intersection controlled by traffic lights.  If both drivers claim that they entered the intersection on a green light, liability issues will turn entirely on credibility, and such cases seem poorly suited to resolution on a motion for summary judgment.

The defendant Simpson did move for summary judgment, however, based on admissions he apparently received from the plaintiff on examinations for discovery and as a result of serving notices to admit.

Simpson’s co-defendant Pamplona, the other involved driver, did not defend the action, and his automobile insurer obtained an order adding it as a third party to the action under section 258(14) of the Insurance Act.  Although this insurer initially opposed Simpson’s motion, it eventually decided to take no position.  The plaintiff persevered, trying to keep Simpson in the action on the grounds that possible testimony from Pamplona would show that Simpson was contributorily negligent.

In her affidavit, she deposed that she’d spoken to Pamplona at a nursing home.  Through a Portuguese-speaking interpreter, she learned that Pamplona had suffered two strokes, had serious diabetes, had undergone an amputation, and had additional serious medical problems. She also indicated that Mr. Pamplona had no recollection of the accident.  There was no evidence to suggest that he would ever recover his memory.

Primarily, it appears that the plaintiff relied on information that her counsel had obtained from counsel for Pamplona’s insurer, indicating that Pamplona made statements at the accident scene which, if true, would mean that he had entered the intersection in obedience to the traffic lights.

On Simpson’s motion for summary judgment, the court stated that even if this evidence was admissible for the purposes of the motion, it was not sufficient to counter the moving party’s evidence demonstrating that there was no genuine issue requiring trial with respect to the potential liability of the defendant Simpson: “The plaintiff raises at best a faint possibility that Mr. Pamplona may be able to testify and recover his memory sufficiently to be able to provide further evidence on how the accident occurred.”

According to the court, a summary judgment motion can’t be successfully resisted on the basis of suggestions or speculation as to evidence that might be obtained at a later date.  The court is required to make its decision based on the evidence actually adduced on the motion.  Simpson’s motion was therefore allowed, and the action against him dismissed.

Link: CanLII – 2011 ONSC 4960 (CanLII)

Richard Hayles, B.A., J.D.

Insurance and commercial litigation lawyer

 

Brief informational summaries about commercial and other litigation matters in the courts of Ontario and other developments are periodically published on this website. They are intended to be a general comment or general discussion, not legal advice and should not be relied upon as legal advice. Should you require legal advice, please contact info@heydary.com or 416 972 9001.

Posted in Civil Litigation, Insurance, Negligence, Personal Injury, Summary Judgment | Add Comment »

Summary Judgment on Insurance and Indemnity Clause in Snow Removal Contract

Tuesday, August 16th, 2011

Contracts for the removal of ice and snow from commercial premises usually contain a provision stating that the contractor is to obtain a liability insurance policy in which the property owner is named as an additional insured. These “insurance and indemnity” clauses usually also state that the contractor is to indemnify the property owner for claims arising out of deficiencies in the contractor’s work.

This type of clause was the subject of a recent summary judgment decision in Papapetrou v. 1054422 Ontario Limited.  The plaintiff brought an action against the owners of a building and their snow removal contractors, saying she had been injured when she fell on some icy steps.  The building owner brought a motion for summary judgment dismissing the plaintiff’s action, or in the alternative, for an order that the snow removal contractor assume the owner’s defense.

The plaintiff did not appear, and counsel advised that the plaintiff took no position regarding the motion.  The judge who heard the motion thought this was relevant, given that the main relief sought on the motion was dismissal of the claim the plaintiff had brought against the defendant property owners.

The motions judge referred to case law indicating that in determining whether or not a claim comes within insurance policy coverage, courts are not strictly bound by the language chosen by the plaintiff, but must determine the true nature of the claim as stated in the statement of claim.

Although the allegations in the statement of claim contained claims that did not “fall within the general occupiers’ liability basket”, the motions judge concluded that the true nature of the claim was for negligence in failing to maintain the steps.  That interpretation was reinforced by the fact that the plaintiffs took no position on the property owner’s motion.  If the plaintiffs were pursuing separate claims as against the property owners (claims distinct from the failure to remove ice), then the plaintiffs would have defended those claims on the motion.

Although the defendant snow removal contractor had failed to obtain liability insurance in accordance with the contract provisions, the court held that this failure should not help them avoid responsibility for their obligation to defend and indemnify.  The court ordered the contractor to assume the property owner’s defense, and indemnify it from any damages awarded to the plaintiffs.

Richard Hayles, B.A., J.D.
Insurance and commercial litigation lawyer

 

Brief informational summaries about commercial and other litigation matters in the courts of Ontario and other developments are periodically published on this website. They are intended to be a general comment or general discussion, not legal advice and should not be relied upon as legal advice. Should you require legal advice, please contact info@heydary.com or 416 972 9001.

Posted in Civil Litigation, Indemnity, Insurance, Litigation Law, Personal Injury, Summary Judgment | Add Comment »