Stephanie R. Quesnelle

This action arose from a fatal motor vehicle accident involving a tractor and a passenger van.

The main action settled, leaving a third-party claim by the defendants (tractor operator and owner) against the Township of Cramahe for contribution and indemnity.

The defendants alleged the Township was negligent and breached its statutory duty by failing to maintain Telephone Road in a reasonable state of repair, specifically by not painting a centerline.

The court found that the absence of a centerline constituted a state of non-repair, as it was required by the Ontario Traffic Manual guidelines.

However, the court ultimately dismissed the third-party claim, finding that the defendants failed to prove, on a balance of probabilities, that 'but for' the absence of the centerline, the accident would not have occurred.

The court concluded that the driver of the van either never identified the tractor as a hazard or did not have sufficient time to react, and the centerline would have made no difference.

Following dismissal of a summary judgment motion brought by a co-defendant seeking to dismiss the plaintiffs’ claim and a cross-claim, the court addressed costs between the co-defendants.

The responding insurer sought partial-indemnity costs exceeding $13,000 after successfully opposing the motion, arguing the matter involved moderate complexity and significant financial exposure under the Insurance Act.

The moving defendant argued the costs were excessive and should either be reduced or made payable in the cause, particularly given the prematurity of the summary judgment motion and issues surrounding the insurer’s standing.

The court held that the insurer was entitled to costs as the successful party but reduced the amount claimed, finding the requested sum excessive in the circumstances.

Costs were fixed at $6,750 payable by the moving defendant.

The appellant insurer appealed a master’s order compelling answers to discovery refusals and production of documents from its claims file in litigation arising from a propane facility explosion and a coverage dispute.

The insurer asserted solicitor-client privilege and litigation privilege over memoranda, meeting notes, and claims file materials generated during the coverage investigation.

The court held that an appeal from a master’s decision is not a de novo hearing and is limited to correcting errors of law, wrong principles, or palpable and overriding errors.

The insurer failed to establish an evidentiary basis for either solicitor-client privilege or litigation privilege because no affidavit evidence demonstrated that the documents contained legal advice or were created for the dominant purpose of litigation.

The master’s order requiring production was therefore upheld.

The defendant dealership moved for summary judgment to dismiss the plaintiffs' personal injury claim and the co-defendant insurer's cross-claim, arguing that the driver's prior criminal conviction for taking the vehicle without consent conclusively established a lack of consent.

The co-defendant insurer opposed the motion.

The court dismissed the motion, finding that the criminal conviction did not have preclusive effect because the driver faced little jeopardy and there was no robust examination of the facts.

The court also held that the insurer had standing to oppose the motion and maintain its cross-claim despite not yet having indemnified the plaintiffs, in order to avoid a multiplicity of proceedings.

Two related applications addressed whether a commercial general liability insurer owed a duty to defend or indemnify its insured gas station operators for environmental contamination claims brought by a landlord.

The landlord sought a declaration requiring the insurer to indemnify the tenants, while the insurer sought a declaration that its policy provided no coverage.

The court held that the landlord, as a stranger to the insurance contract, could not pursue indemnification before obtaining judgment against the insured under s. 132 of the Insurance Act.

Interpreting the policy wording and pollution exclusion clauses, the court found the claim fell squarely within the policy’s pollution exclusions.

The insurer therefore had no duty to defend or indemnify the tenants in the underlying environmental contamination action.