Donald James Dacquisto

This is an appeal concerning the application of the doctrine of equitable contribution between two insurers, Northbridge and Aviva, for the defence and indemnification of a shared insured, Mr. Daneshvari, in an underlying professional misconduct action.

Both insurers' policies contained "other insurance" clauses purporting to be excess.

The Court of Appeal upheld the application judge's finding that the policies were irreconcilable, requiring equal contribution.

The court affirmed that the standard of review for interpreting these specific "other insurance" clauses was palpable and overriding error, not correctness, as they were not standard form contracts with significant precedential value.

The appeal was dismissed, and Aviva was ordered to pay costs to Northbridge.

An appeal concerning the failure to disclose immediately litigation agreements between a plaintiff (subrogated insurer) and a defendant that converted their adversarial relationship into a cooperative one.

The plaintiff and defendant entered into two agreements (2011 and 2016) whereby the defendant would defend the action and prosecute a third-party claim funded by the plaintiff, and subsequently the plaintiff assigned all its rights in the action to itself.

These agreements were not disclosed immediately but rather piecemeal throughout 2016.

The motion judge found the agreements should have been disclosed but refused to stay the action, finding no prejudice.

The appellate court reversed, holding that failure to immediately disclose agreements that change the litigation landscape constitutes abuse of process requiring a stay of the non-disclosing party's claim as a matter of principle.

Geo.

Williamson Fuels Ltd. moved to stay the action, arguing that the plaintiff and H&M Combustion Services Ltd. failed to disclose a litigation agreement for approximately five years.

The court found that the agreement, which involved the plaintiff's insurer funding H&M's defense and third-party claim, altered the adversarial orientation of the lawsuit and should have been disclosed.

However, applying the principle of proportionality, the court determined that a stay of the action against Williamson was not an appropriate remedy, particularly given that the third-party claim itself was a nullity due to H&M's prior dissolution.

The motion to stay was dismissed.