A costs decision following a summary judgment motion concerning the priority of motor vehicle liability insurance coverage under s. 277 of the Insurance Act.
The moving parties sought full indemnity costs exceeding $39,000, arguing that where insurers share a duty to defend, equitable principles require full reimbursement of defence costs.
The third party insurer opposed, submitting the dispute concerned priority of coverage rather than the existence of a duty to defend, and that only modest partial indemnity costs should be awarded.
The court held that priority disputes between insurers do not give rise to the same contractual obligation to fully indemnify defence costs as duty-to-defend cases.
Considering delay in bringing the motion and the unsettled nature of the law, the court awarded reduced costs.