Guidelines for When Solicitor Will be Removed from Record

Posted on March 30, 2006 by Stephen Cavanagh

In George S. Szeto Investments Ltd. et al. v. Ott et al., Master Robert Beaudoin has provided a very useful “checklist” of factors that a court will consider when deciding whether or not a party’s solicitor should, on motion by an opposing party, be removed as solicitor of record. In particular, the case focuses on the issue of a party’s lawyer being a witness at trial.

The law is not new; Master Beaudoin relied on a 1992 Divisional Court decision. But in his reasons, he discusses some of the problems that have cropped up since then on these kinds of motions. (For example, there is a divergence of authority as to whether the motion to remove the opposing solicitor should be brought early or late in the proceedings. The Master reconciles these two streams of caselaw.)

In our experience, the frequency of this type of motions is on the rise. It is helpful to have the applicable principles so conveniently summarized in one place.

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General Accident v. Chrusz Finally Goes to Trial

Posted on March 30, 2006 by Stephen Cavanagh

Back in 1999, the Ontario Court of Appeal handed down its ruling in the case of General Accident Assurance Company et al. v. Chrusz et al. The decision became one of the leading cases in Ontario on the meaning of solicitor-client privilege and litigation privilege.

Seven years later, the case has finally been tried. (In fact, the trial was bifurcated, so the trial proceeded only on this issue of liability. Damages will be assessed at a later date.)

The just-released decision of Regional Senior Justice McCartney on the liability phase of the case is reported here. When the trial on damages is held, the news is not likely to be good for the insurers (who, in this action, are the plaintiffs). McCartney R.S.J. dismissed G.A.’s claim for damages resulting from fraud in a proof of loss filed in connection with a fire claim. A number of individual defendants were sued by G.A. and the action was dismissed as against all of them.

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DAC Assessment Does Not Preclude Insurer’s IME in SABS Lawsuit

Posted on March 24, 2006 by Stephen Cavanagh

In Baron v. Kingsway General Insurance Company, Superior Court Justice Gladys Pardu rejected the argument of a statutory accident benefits claimant, that the insurer was not entitled to its own medical assessment because a CAT-DAC assessment had already found him to be catastrophically injured.

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Costs in Personal Injury Action

Posted on March 23, 2006 by Stephen Cavanagh

goodhands.jpg Madam Justice Joan Lax has released her costs ruling in the well-known case of Snushall v. Fulsang. (This is the case in which the Court of Appeal ruled last year, that contributory negligence for a passenger’s failure to wear a seatbelt, could not exceed twenty-five percent.)

In today’s decision, Lax J. had to fix costs of the action. In her very detailed analysis, she made a number of points that are of general interest to practitioners in the personal injury field.

(One senses, in reading Her Honour’s reasons, that she was not very happy with either lawyer. She faulted one for regularly showing up late for court, without explanation, and the other for the quality of his costs submissions.)

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C.A. Reverses Judge’s Non-Suit Order, Restores Jury’s $3M Award

Posted on March 23, 2006 by Stephen Cavanagh

 

 hardwood-lumber.jpg The Court of Appeal has just released its decision in Calvin Forest Products v. Tembec Inc. This was a case that was tried in Ottawa last year, before Justice Roydon Kealey and a jury. At the end of the trial, the jury found for the plaintiff and awarded damages in excess of $3 million for negligent misrepresentation. Counsel for the defendant Tembec moved for non-suit on the claim for misrepresentation, notwithstanding the jury’s findings. Justice Kealey granted the motion. This had the effect of eliminating the $3 million damages for misrepresentation, leaving the plaintiff only $60,864.69 as damages for breach of contract.

All of that changed today. The Court of Appeal reversed the trial judge’s non-suit order, restoring the jury’s award of damages for negligent misrepresentation in the amount of $3,086,700. The Court of Appeal found that Kealey J. had not applied the correct test in ruling on the non-suit: “He took into consideration Tembec’s position on some of the evidence and the weight that Tembec felt should be given to various pieces of evidence. In effect, he focused on the evidence most favourable to Tembec and reached his own conclusions.”

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C.A. Says Covenant to Insure Does Not Necessarily Imply Waiver of Right to Sue

Posted on March 22, 2006 by Stephen Cavanagh

scrolls.jpg In The Provident Bank v. Wells Fargo Bank Northwest, released today, the Court of Appeal considered whether a party’s covenant to insure had the effect of relieving the party to whom the covenant was allegedly given, from liability in negligence.

The facts of the case are a bit complicated, but for purposes of this summary, we can simplify quite a bit. One party, Chell, stored an airplane with another, Maxwell. Some parts of the airplane went missing while in Maxwell’s possession. Maxwell claimed that it had entered into an oral agreement with Chell, whereby Chell was to insure the airplane. Chell did, in fact, insure the plane, although there was considerable doubt as to whether there had ever been a covenant to insure given by it to Maxwell.

The issue before the Court of Appeal was whether this supposed covenant to insure protected Maxwell from liability to Chell (or its successors) in negligence, for the damage to the airplane while it was being stored by Maxwell. The Court held that even if Chell did agree with Maxwell, that Chell would insure the plane, that agreement did not protect Maxwell from tort liability.

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Litigation Privilege Can Arise Before Demand Made or Lawsuit Commenced

Posted on March 21, 2006 by Stephen Cavanagh

Here’s a case that we missed when it was first released last September. It has just been reported in the Ontario Reports, so the lawyers, judges and masters who subscribe to our Updates will already have seen it. But for the benefit of other subscribers, we are including it now.

In Allan v. CHC (Canada) Casinos Ltd., the plaintiff tripped and injured herself at the defendant’s casino. The defendant retained an independent adjusting firm to investigate the plaintiff’s fall. This occurred before it had received any demand on behalf of the plaintiff and before any litigation had been commenced. As well, the defendant itself had not retained counsel.

Several letters were exchanged between the casino and the adjusting firm it had hired. When a lawsuit was later brought by the plaintiff, her lawyer sought production of the adjuster’s seven reports and of the one letter that had been sent to the adjusting firm by the casino. This motion for an order that the documents be produced was heard by Justice Robert N. Weekes. He ruled in favour of the casino and held that the documents were protected by litigation privilege.

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Divisional Court Finds FSCO Ruling on “Catastrophic Injury” Not “Patently Unreasonable”

Posted on March 15, 2006 by Stephen Cavanagh

In Liberty Mutual Insurance Company v. Young, the insurer was seeking judicial review of a FSCO decision in which an arbitrator and a Director’s Delegate had found that the claimant was entitled to enhanced accident benefits because of having suffered a catastrophic impairment as defined in s. 2(1.1)(e)(i) of the SABS. There had evidently been four Glasgow Coma Scale tests administered within one hour in which the claimant’s score had fallen below 9 out of 15. In order to qualify for enhanced benefits, the claimant had had to satisfy the FSCO arbitrator, that he had a score of 9 or less on the Glasgow Coma Scale “according to a test administered within a reasonable period of time after the accident by a person trained for that purpose”. The issue was whether one hour was “a reasonable time after the accident”. The FSCO arbitrator and Director’s Delegate had held that it was.

On this application for judicial review, the insurer argued that the FSCO tribunals had acted unreasonably in not accepting expert evidence as to what was a “reasonable period of time”. It also argued that FSCO’s own arbitral decisions on the issue were in conflict.

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Homeowner’s Policy Must Indemnify Against Criminally Negligent Shooting

Posted on March 15, 2006 by Stephen Cavanagh

The latest chapter in the Eichmanis litigation is a ruling on whether either of two homeowner’s insurance policies provided liability coverage to a 15 year old boy who had pleaded guilty to criminal negligence causing bodily harm as a result of having shot a 13 year old friend. The shooting took place while the boys were playing in the empty house of the 15 year old’s father. The friend had suffered serious injuries and had sued the boy and members of his family. That litigation went all the way to the Court of Appeal. The 15 year old was found to be 30% responsible for damages of $799,875. At the time of this motion, the judgment remained wholly unsatisfied.

In this action, Eichmanis v. Wawanesa Mutual Insurance Company, the injured plaintiff and his family had sued the insurers of the boy’s mother and his aunt and uncle under s. 132 of the Insurance Act, seeking payment of the award against the 15 year old boy. They brought a motion, asking the court to interpret the policies.

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Defendant Insurer Awarded Substantial Indemnity Costs from Date of Offer

Posted on March 15, 2006 by Stephen Cavanagh

In a rather unusual ruling, Mr. Justice Herman Siegel has awarded costs on a substantial indemnity basis to a defendant, on the basis that both litigants were commercial parties with substantial resources and access to specialized legal advice. The award was made in Canadian Universities Reciprocal Insurance Exchange v. CGU Insurance Company of Canada and State Farm Fire and Casualty Company.

The case involved Rule 49 of the Rules of Civil Procedure, which deals with offers to settle. The Rule provides that where a plaintiff makes an offer and, at trial, obtains a judgment at least as favourable as the offer, the plaintiff is entitled to partial indemnity costs to the date of the offer and substantial indemnity costs thereafter.

However, if it is a defendant who makes the offer (and the plaintiff obtains a judgment that is less favourable than the offer), the plaintiff is entitled to partial indemnity costs to the date of the offer and the defendant is entitled to partial indemnity costs after that date. In other words, Rule 49 does not make provision for substantial indemnity costs to be payable to defendants as a result of beating an offer to settle.

But of course, the court retains discretion to depart from the costs consequences prescribed by the Rule. Nevertheless, despite numerous attempts by defendants to obtain costs on the higher scale, the courts have usually refused to do so.

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