Anthony Cole

The plaintiffs appealed a Master's order allowing certain paragraphs in the defendants' Statement of Defence.

The plaintiffs argued the paragraphs improperly pleaded evidence rather than material facts, contrary to Rule 25.06.

The court upheld the Master's decision regarding paragraphs quoting emails and detailing facts for a fair comment defence.

However, the court struck a paragraph that quoted extensively from expert reports, finding it improperly pleaded evidence, and granted leave to amend.

The defendant fuel oil distributor was sued after a fuel oil tank it sold leaked, causing property damage.

The defendant brought a third-party action against its insurers seeking a declaration of a duty to defend.

One insurer argued the claim was barred by a one-year contractual limitation period incorporated from statutory fire conditions.

The court held that the fire statutory conditions could not be applied to third-party liability coverage without anomalous consequences, meaning the general two-year statutory limitation period applied and the claim was not barred.

The court found the first insurer had a duty to defend as there was a mere possibility the damage occurred during its policy period.

However, the court dismissed the claims against the other insurers, finding that pollution exclusions and specific policy definitions precluded coverage.

Following the granting of summary judgment dismissing the plaintiff’s action against both defendants, the court determined the appropriate costs award.

The defendants sought substantial indemnity costs relying on Rule 49 settlement offers and the complexity of the litigation.

The court reviewed the governing principles under s. 131 of the Courts of Justice Act and Rule 57.01 of the Rules of Civil Procedure, including proportionality, the result obtained, the conduct of the parties, and the offers to settle.

Although the defendants had made settlement offers and were fully successful, the court found no reprehensible conduct by the plaintiff warranting substantial indemnity costs.

Exercising its discretion, the court fixed costs payable by the plaintiff at $30,000 to one defendant and $18,000 to the other.