Nolan R. Downer

The applicants, a municipal township and its council members, sought a declaration that their liability insurer, the respondent, had a duty to defend them in a civil action.

The underlying action alleged misfeasance in public office and Charter breaches arising from a trespass notice issued against a resident.

The insurer denied coverage for the individual council members, arguing the claims were akin to punitive damages and excluded.

The court found that the pleadings alleged bodily and personal injury falling within the policy's coverage grant and endorsements, and no exclusions applied.

The application was granted, and the insurer was ordered to defend all applicants.

Following a successful motion for leave to appeal, the defendants sought costs on a partial indemnity basis.

The plaintiffs agreed the amounts were reasonable but argued payment would create a tremendous financial burden due to their impecuniosity.

The court fixed the costs as requested but, exercising its discretion under Rule 57.03(1), ordered that the costs be payable following the final resolution of the matter by the Divisional Court.