The plaintiff was injured in a motor vehicle accident and claimed both statutory accident benefits and tort damages.
The insurer, which insured both the plaintiff and the defendant, denied coverage alleging a staged accident.
The insurer retained the same law firm to defend it in the accident benefits arbitration and to defend the tort action, providing the law firm with the plaintiff's confidential accident benefits file without consent.
The plaintiff successfully moved to remove the law firm as solicitor of record due to a conflict of interest.
The insurer appealed to the Divisional Court.
The Divisional Court dismissed the appeal, holding that an insurer owes a duty of good faith and must maintain a privacy 'firewall' between its accident benefits and tort departments.
Retaining the same counsel and sharing confidential information without consent created an irreconcilable conflict of interest.
