Robert Franklin

Following a successful motion removing counsel for the insurer due to a conflict of interest arising from representation in both accident benefits and tort proceedings, the court addressed costs.

The insurer argued that delay by the moving party in raising the conflict should disentitle it to costs because significant work had already been completed by counsel who would need to be replaced.

The court rejected this argument, finding the conflict arose from the insurer’s failure to maintain separation between accident benefits and tort files.

Applying Rule 57.01 of the Rules of Civil Procedure and principles from appellate jurisprudence on reasonableness of costs, the court held that the time and rates claimed were reasonable.

The moving party was awarded costs on a partial indemnity basis.

Addendum to a prior decision correcting the wording of an order concerning the removal of counsel for a statutory third party insurer.

The original judgment was amended to clarify that the motion sought removal of the law firm representing the statutory third party, rather than the individual defendant driver.

The court ordered that the law firm be removed as solicitors of record for the statutory third party insurer.

The litigation guardian was permitted to make written submissions on costs, with the insurer given time to respond.

The plaintiff brought a motion seeking removal of a law firm acting for an insurer as statutory third party in a tort action arising from a motor vehicle accident.

The insurer also provided accident benefits coverage to the plaintiff and retained the same firm to act in both the accident benefits claim and the defence of the tort action.

The firm used documents and information obtained from the plaintiff in the accident benefits claim to defend the tort action against the insured driver.

The court held that this dual representation created a clear conflict of interest, particularly where no effective information barrier existed between the two matters.

The firm’s conduct contravened principles governing conflicts of interest and the protection of confidential information between insurer and insured relationships.

The firm was removed as solicitors of record for the insurer in the tort action.