The appellants, former lawyers at a firm where the principal misappropriated trust funds, appealed a motion judge's refusal to set aside or vary a garnishment order against the firm's professional liability insurer.
The respondents, who were owed $3.6 million, sought to exhaust the $1 million policy limits.
The appellants argued they needed the policy for defence costs against threatened claims by the respondents.
The Court of Appeal allowed the appeal in part, varying the order to require the respondents to release any claims against the appellants relating to the trust funds as a condition of receiving the garnished insurance proceeds, noting the respondents could not articulate any substantive claim against the appellants.
