Dominic T. Clarke

The respondents, facing multiple class actions related to the manufacture and distribution of opioids over a 20-year period, sought coverage for defence costs from their successive primary and excess liability insurers.

The application judge allowed the respondents to select a single primary insurer to fund the entire defence, permitted the exhaustion of self-insured retentions (SIRs) using payments from other insurers, granted relief from forfeiture for pre-tender defence costs, and required insurers to sign a Defence Reporting Agreement (DRA) to receive privileged defence information.

The Court of Appeal allowed the insurers' appeals in part, holding that defence costs must be allocated on a pro rata time-on-risk basis, that the insureds must exhaust each applicable SIR before an insurer's duty to defend is triggered, and that relief from forfeiture was unavailable for pre-tender costs.

The Court upheld the DRA requirement for insurers seeking to associate in the defence to mitigate reasonable apprehensions of conflict of interest.

The defendant insurers brought a motion for further and better affidavits of documents from the plaintiff insureds in a coverage dispute under a builders' risk insurance policy.

The dispute arose from a 15-month delay in completing a light rail transit project, which the plaintiffs attributed to a sinkhole event.

The defendants sought production of subcontractor change orders, native schedules, and delay-related correspondence to explore other potential causes of the delay.

The court dismissed the request for change orders and schedules as premature and insufficiently substantiated, but granted the request for certain delay-related correspondence to assist in identifying other subcontractors who may have caused delays.