Christine Powell

Investors sued a chartered accountant and his consulting corporation alleging breach of fiduciary duty and negligence after losing money in complex domestic and offshore investment structures connected to an investment club and related entities.

The court found the advisor promoted the investments, failed to disclose commissions, and reassured the investors about the legitimacy of the structure despite serious regulatory concerns and structural deficiencies in the investment scheme.

The relationship involved trust, reliance, and vulnerability sufficient to create a fiduciary duty.

The advisor breached that duty by failing to disclose conflicts, failing to warn about regulatory issues, and misrepresenting the diligence performed.

Liability was imposed for the plaintiffs’ investment in the domestic issuer but not for later investments made after regulatory warnings, which the court held the plaintiffs unreasonably failed to mitigate.

The plaintiff moved for leave to amend its statement of claim to add its insurance broker as a defendant and to assert negligence and breach of duty claims arising from insurers’ denial of coverage in related litigation.

The proposed claims were contingent on the plaintiff failing to obtain indemnity and defence costs from the insurers.

The court considered Rules 5.04(2) and 26.01 of the Rules of Civil Procedure alongside the mandatory two‑year limitation period under the Limitations Act, 2002.

It held that the plaintiff had knowledge of the material facts underlying the broker’s alleged negligence when the insurers denied coverage, more than two years before the motion to amend.

Because the limitation period had expired and no evidence rebutting discoverability was provided, the broker could not be added as a party.

In a motor vehicle personal injury action, the defendant brought a motion concerning undertakings, refusals, and production from non-parties following examinations for discovery.

The defendant sought disclosure of defence medical reports and settlement particulars from the plaintiff’s prior motor vehicle litigation.

The court held that defence medical reports obtained in prior litigation are subject to the deemed undertaking rule under Rule 30.1 and cannot be disclosed without leave of the court or consent of the original producing party.

The court also confirmed that settlement amounts and particulars from prior litigation are protected by settlement privilege and were not relevant in the circumstances, particularly where the accidents were years apart.

The contested disclosure requests were denied, and the plaintiff was awarded costs.