SUPERIOR COURT OF JUSTICE - ONTARIO

RE: TD BANK, N.A., Plaintiff

AND:

"LLOYD'S UNDERWRITERS" THAT SUBSCRIBE TO POLICY NUMBER MMF/1710, PRIMARY LONDON REFERENCE NUMBER B0509QA025509 AND EXCESS LONDON REFERENCE NUMBERS QA025609, QA025709, QA025809, AND QA025909, ANT ARES UNDERWRITING LIMITED FOR ITSELF AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICATE 1274 (AUL) FOR THE OPERATING YEAR OF 2009, CATLIN SYNDICATE LIMITED FOR ITSELF AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICATE 2003 (SJC) FOR THE OPERATING YEAR OF 2009, NOVAE CORPORATE UNDERWRITING LIMITED AND/OR NOVAE SYNDICATES LIMITED FOR THEMSELVES AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICA TE 2007 (NVA) FOR THE OPERATING YEAR OF 2009, ACE CAPIT AL LIMITED, ACE CAPITAL IV LIMITED, AND ACE CAPITAL V LIMITED FOR THEMSELVES AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICATE 2488 (AGM) FOR THE OPERATING YEAR OF 2009, BRIT UW LIMITED FOR ITSELF AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICATE 2987 (BRIT) FOR THE OPERATING YEAR OF 2009, CHAUCER CORPORATE CAPITAL (NO.3) LIMITED (FORMERLY KNOWN AS PEMBROKE 4000 LIMITED) AND/OR PEMBROKE 4000 LIMITED, CHAUCER CORPORATE CAPITAL (NO.2) LIMITED, AND/OR IRONSHORE CORPORATE CAPITAL LTD. FOR THEMSELVES AND ON BEHALF OF ALL MEMBERS OF LLOYD'S SYNDICATE 4000 (PEM) FOR THE OPERATING YEAR OF 2009, ASPEN INSURANCE UK LIMITED, GREAT LAKES REINSURANCE(UK)PLC, LEXINGTON INSURANCE COMPANY, AIG INSURANCE COMPANY OF CANADA (FORMERLY KNOWN AS AIG COMMERCIAL INSURANCE COMPANY OF CANADA) AND/OR AIG COMMERCIAL INSURANCE COMPANY OF CANADA, CHARTIS EXCESS LIMITED (FORMERLY KNOWN AS AIG EXCESS LIABILITY INSURANCE INTERNATIONAL LIMITED) AND/OR AIG EXCESS LIABILITY INSURANCE INTERNATIONAL LIMITED, ALLIED WORLD ASSURANCE COMPANY LTD., ARCH INSURANCE COMPANY AND/OR ARCH INSURANCE CANADA LTD., AXIS SPECIALTY INSURANCE COMPANY AND/OR AXIS SPECIALTY LIMITED, CHUBB INSURANCE COMPANY OF CANADA, ENDURANCE SPECIALTY INSURANCE LTD., HOUSTON CASUALTY COMPANY, LIBERTY MUTUAL INSURANCE COMPANY, MARKEL BERMUDA LIMITED (FORMERLY KNOWN AS MAX BERMUDA LTD.) AND/OR MAX BERMUDA LTD., AND XL INSURANCE COMPANY PLC (FORMERLY KNOWN AS XL INSURANCE COMPANY LIMITED) AND/OR XL INSURANCE COMPANY LIMITED, Defendants

BEFORE: A.A. SANFILIPPO J.

COUNSEL: W.G. Scott, H. Afarian and D. Thomas, for the Plaintiff, TD Bank, N.A.

S. Sasso, for a group of nine Defendant Lloyd’s Underwriters and Axis Specialty Insurance Company and/or Axis Specialty Limited

P. Green and D. Vaillancourt, for the Defendants, Lexington Insurance Company and the AIG Group of Defendants

G. Gill and Eric Dolden, for the Defendant Allied World Assurance Company Ltd.

R. Tinney, for the Defendant ARCH Insurance Company

A. Crawley and J. Preece, for the Defendants Chubb Insurance Company of Canada and Liberty Mutual Insurance Company

T. Galligan and Andrew Rance, for the Defendants Endurance Specialty, Houston Casualty Company, Markel Bermuda Limited (formerly known as Max Bermuda Ltd.), and/or Max Bermuda Ltd. and XL Insurance Company PLC (formerly known as XL Insurance Company Limited) and/or XL Insurance Company Limited

HEARD

(By Videoconference): November 24, 2020

ENDORSEMENT

[1] This is an insurance coverage action. The Plaintiff, TD Bank, N.A. (“TD Bank”), seeks insurance coverage from the Defendants for losses that it alleges to have sustained in the settlement of nineteen legal proceedings in Florida.

[2] The parties brought three motions:

(a) The Defendants brought a motion to compel the Plaintiff to provide answers to questions refused, under Rule 31.07 of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 (the “Defendants’ Refusals Motion”).

(b) The Plaintiff brought a motion to compel answers to questions refused by certain of the Defendants, also under Rule 31.07, and to compel a further and continued right of examination of these Defendants (the “Plaintiffs’ Refusals Motion”).

(c) The Defendants Lexington Insurance Company and the AIG Group of Defendants brought a motion for an Order for leave to examine a second discovery representative of the TD Bank, under Rules 31.03(2)(b) and 34.15(1) (the “AIG Motion for Second Discovery Representative”).

[3] All three motions are within the jurisdiction of a Master. Based on the parties’ submissions and my review of the extensive record filed, I was satisfied that there is no Order or Direction requiring that these Master’s motions be heard by a Judge.

[4] The Consolidated Practice Direction for Civil Actions, Applications, Motions and Procedural Mattes in the Toronto Region, effective July 1, 2015, as amended (“Toronto Region 2015 Civil Practice Direction”) states, in Part I. B, paragraph 11, that “Master’s motions must be made to a Master”:

11. Motions to be Heard by Masters. A master has jurisdiction to hear any motion in a civil proceeding except those specified in rule 37.02(2). Master’s motions must be made to a master. Unless the relief requested in the motion is within the exclusive jurisdiction of a judge, a motion returnable by attendance or in writing must be made to “the Court” and heard by a master. Judges may refuse to hear any motion that is within the jurisdiction of a master.

[5] Rule 37.02(1) provides that a Judge may hear any motion in a proceeding. However, the Toronto Region 2015 Civil Practice Direction makes clear that parties with civil cases in Toronto Region are directed to bring Master’s motions to a Master. I see no reason why the parties in this action ought to diverge from this Practice Direction.

[6] I thereby direct that the three motions pending in this action, the Defendants’ Refusals Motion, the Plaintiffs’ Refusals Motion and the AIG Motion for Second Discovery Representative (collectively “these Motions”) are transferred to a Master for determination.

[7] I direct, further, that these Motions shall be scheduled for hearing before a Master on March 8, 9 and 10, 2021, being dates made available by the Court that are convenient to the lawyers for the parties, and consistent with their estimate that these Motions require a three-day hearing.

[8] In reaching my determination that these Motions will be heard by a Master, I took into consideration that there will be a delay in the adjudication of these Motions. There would have been a delay of comparable length even had I concluded that these Motions should be heard by a Judge because these Motions were not ready for argument and would have been traversed to a future motions list that could accommodate a three-day hearing, for the following reasons:

(a) The Defendants’ Refusal Motion involves some 515 ‘Questions Refused’ that the Defendants have categorized into 8 ‘Topics’ which, in turn, contain some 42 ‘Groups’. The Defendants submitted that determination of the 8 Topics and, at most the 42 Groups would govern the underlying 515 Questions Refused and contended that the hearing of these threshold issues could be completed in the time allotted for the Defendants’ Refusal Motion. The responding party Plaintiff does not agree with the Defendants’ organization of the Questions Refused into the Topics and Groups, or that their determination would be dispositive of the questions sorted into those Groups. An agreement on the structural approach to this volume of Questions Refused is an essential predicate to an efficient hearing within the time that had been allotted.

(b) If the parties cannot agree on the compilation of the Questions Refused into Topics and Groups whose determination will govern the underlying Questions Refused, and instead require the determination of individual Questions Refused, then the number of Questions Refused would have to be reduced to fit efficiently and practically into a workable hearing.

(c) The Refusals Charts prepared by the moving party Defendants on the Defendants’ Refusal Motion and by the moving party Plaintiff on the Plaintiff’s Refusal Motion must be coordinated with the pleadings (442 pages), the Discovery Plan, the TD Bank Affidavit of Documents (4,284 pages) and the transcript in which the refusal was made. These documents are foundational to framing and determining the many issues raised by the Refusals Motions. They are too large to allow for efficient consideration at a hearing without coordination and connection to the precise page or document reference applicable to the issue under consideration, and this detail is currently absent from the Refusal Charts.

(d) The Refusals Chart prepared by the moving party Defendants and submitted as part of the Defendants’ Refusal Motion, Vol. 1, comprises 83 pages and some 515 Questions Refused. This was excised and reorganized from the TD Bank’s Response Chart (TD Bank, Responding Record, Vol. 1, Tab 31) which comprises 106 pages and 822 Questions Refused. These Charts must be coordinated so that the current Question Refused can be referred to in the context of any questions surrounding it that have now been answered.

[9] In addition, there were technical deficiencies in the materials currently filed. Absent those issues identified in paragraph 8, immediately above, these technical deficiencies would not have prevented the hearing from proceeding but would have adversely affected its efficiency and ought to be corrected before these Motions are returned in March 2021. They include the following: (i) there are no Bookmarks in certain volumes of the moving party Defendants records, including Volumes 1 and 2 on the Defendants’ Refusal Motion, and in certain volumes the Bookmark function is present but not operational; (ii) the legal authorities are not hyperlinked to the factums, as is required for long motions; and (iii) the pagination varies between the physical records, the electronic records and the indices, with potential for inefficiencies in oral argument when dealing with records of this size.

[10] The parties’ efforts to address the issues identified in paragraphs 8 and 9, above, are important to the orderly hearing of these Motions in the three-days scheduled. In turn, the parties’ ability to argue these Motions in the time available in March 2021 is important to the parties remaining on schedule for the long-trial date that the Court has scheduled in this action for September 2021.

[11] Accordingly, on the consent of the parties, I direct, under Rule 50.13(1), that the lawyers for the parties attend a case conference before me to address the issues pertaining to the orderly development of these Motions for hearing. The purpose of the case conference is as set out in Rule 50.01. Further to Rule 50.13(2), the parties are not required to participate in the case conference with their lawyers.

[12] The lawyers for the parties will confer on three dates on which they are all available to attend a case conference, by video, at either 9:15 am or 3:00 pm. They shall then provide the list to my judicial assistant, with copy to all counsel. In their scheduling, the parties shall allow sufficient time to consider the issues raised by this Endorsement and to take any necessary instructions. The video coordinates for the virtual case conference will be provided by the Court.

[13] Notwithstanding Rule 59.05, this Order is effective from the date it is made and is enforceable without any need for entry and filing. In accordance with Rules 77.07(6) and 1.04, no formal Order need be entered and filed unless appeal or a motion for leave to appeal is brought to an appellate court. Any party to this Order may nonetheless submit a formal Order for original signing, entry and filing.

JUSTICE A.A. SANFILIPPO

Date: November 24, 2020