Law Times

Law Times • November 23, 2015 Page 15 www.lawtimesnews.com that Patent Act and Patented Medicines (Notice of Compli- ance) Regulations were com- plete code concerning available remedies, however, jurispru- dence was inconclusive on this issue. Despite substantial over- lap, two separate and distinct causes of action existed. It was not plain and obvious that Mo- nopolies Acts were no longer in force. Apotex Inc. v. Eli Lilly and Co. (Aug. 27, 2015, Ont. S.C.J., Sean F. Dunphy J., File No. CV- 11-420115) 258 A.C.W.S. (3d) 175. Insurance LIABILIT Y INSURANCE Applicants granted order compelling respondents to share in cost of defence Applicant company acciden- tally delivered chlorine for wa- ter purification and filtration system at public pool into tank containing muriatic (hydro- chloric) acid setting off chemi- cal reaction that created cloud of potentially deadly chlorine gas that infiltrated public ar- eas of pool and surrounding neighbourhood. Two actions, alleging negligence, nuisance and breach of provisions of Environmental Protection Act commenced, both naming ap- plicant company as defendant. Applicant insurer, who insured applicant company pursuant to automobile insurance policy, conceded claims might be cov- ered by policy and accepted ob- ligation to defend. Respondent insurer under comprehensive general liability policy and re- spondent insurer under pol- lution incident liability policy, however, relied on clauses ex- cluding coverage for claims arising from loading or unload- ing motor vehicle using equip- ment attached thereto, provid- ed claim covered by automobile insurance policy, to deny duty to defend. Applicants sought order compelling respondents to share in cost of defence. Ap- plication allowed. Obligation to defend, as opposed to obliga- tion to indemnify, arose where pleadings of underlying action alleged facts that, if true, would require insurer to indemnify. If pleadings unclear, obliga- tion to defend arose if coverage could be inferred on reason- able reading. In order to avoid trial within trial, extrinsic evi- dence not generally admissible. While underlying pleadings here made no mention of any motor vehicle, applicants ad- mitted motor vehicle employed in delivery of pool chemicals. Mere fact that chlorine brought to site of incident by motor ve- hicle, however, did not establish there was no possibility liabil- ity insurers might be required to indemnify. Exact cause or mechanism of incident not yet established. There was at least "mere possibility" motor vehi- cle exclusions would not apply because, for example, automo- bile insurance policy did not apply, with result respondents had duty to defend. Each re- spondent should reimburse ap- plicant insurer for one-third of costs incurred to date and bear equal share of costs moving forward. Aquatech Logistics Inc. v. Lom- bard Insurance Co. (Sep. 22, 2015, Ont. S.C.J., Sean F. Dun- phy J., File No. CV-15-519719) 258 A.C.W.S. (3d) 183. POLICY LIMITS Motion judge's interpreta- tion of insurance policy was reasonable and correct Applicant issued accounts re- ceivable insurance policy. Re- spondent was international trading company whose cus- tomers had outstanding invoic- es they refused to pay. Receiver was appointed with respect to respondent's accounts re- ceivable from two customers. Receiver sought to recover un- paid balance of invoices under policy, but applicant alleged its obligations were deferred due to ongoing disputes. Receiver brought motion for order de- claring that there were no out- standing disputes under policy with respect to accounts receiv- able in question. Motion was dismissed. Receiver appealed. Appeal dismissed. Motion judge's interpretation of insur- ance policy in context of factual matrix was reasonable and cor- rect. Customers' claims for set- off against amounts owing un- der contracts with respondent were not frivolous. Policy was not ambiguous as to nature of dispute that would forestall ap- plicant's liability to pay respon- dent's claims for loss arising out of customers' refusal to pay in- voices. Clause in issue was not exclusionary clause that should be interpreted contra proferen- tum against applicant. Banque de Commerce et de Placements, S.A. v. Bissma Pa- cific Inc. (Sep. 15, 2015, Ont. C.A., K.M. Weiler J.A., K. van Rensburg J.A., and L.B. Roberts J.A., File No. CA C60115) Deci- sion at 250 A.C.W.S. (3d) 108 was affirmed. 258 A.C.W.S. (3d) 185. Municipal Law BYLAWS City conformed with pur- chasing bylaws Plaintiff electrical contractor was, during certain periods, listed on roster of pre-qualified suppliers to be hired by city for work. Plaintiff alleged that it was denied contracts to per- form electrical and traffic sig- nalization work because city did not adhere to its purchasing bylaws. Plaintiff brought action against city. Action dismissed. Purchasing bylaws dealt with procurement and did not apply where city used its own staff, equipment, and/or resources as there was no acquisition of goods and services. Bylaws did not guarantee work to any sup- plier and did not require city to rotate or distribute work to all or anyone on roster. As by- laws did not restrict amount of work that could be procured from single supplier and did not impose any restrictions on use of day labour, city was en- titled to routinely hire R Inc. on day-labour basis without following competitive pur- chasing processes. Under by- laws, formality of process for acquiring goods and services increased as value of goods and services increased. Plaintiff did not establish that city engaged in contract-splitting, improp- erly assessed value of goods and services, or directed that R Inc. submit invoices in smaller dol- lar amounts to disguise work as of lower value. There was no ev- idence that city did not follow competitive purchasing pro- cess where required by bylaws. Bylaws did not require city to do work for other government agencies or levels without us- ing its own resources. City con- formed with bylaws. Weinmann Electric Ltd. v. Ni- agara (Regional Municipality) (Aug. 6, 2015, Ont. S.C.J., J.W. Quinn J., File No. St. Catha- rines 52129/10) 258 A.C.W.S. (3d) 208. COUNCILLORS Application judge erred in approach to s. 4(k) of Municipal Conflict of Interest Act Appellant was local and re- gional councillor for City of Vaughan. His son, SF, was asso- ciate with firm retained by DB to appeal aspect of Vaughan Official Plan 2010 to Ontario Municipal Board. SF working directly on DB appeal under su- pervision of partner. Section 3 of Municipal Conf lict of Inter- est Act provides that pecuniary interest of any parent, spouse, or child of councillor, if known to councillor, is deemed to be pecuniary interest of council- lor. Section 5 of Act requires councillor to declare any pecu- niary interest except, pursuant to s. 4(k) of Act, where pecuni- ary interest so remote or insig- nificant it cannot reasonably be regarded as likely to inf lu- ence the councillor. Appellant adopted practice of disclosing and declaring interest with re- spect to any matter in which he knew firm was retained. Given importance of matters related to City of Vaughan Plan, how- ever, he brought application to determine whether he could participate in council proceed- ings with respect to the DB Appeal without breaching Act. Application judge dismissed application. Appellant's appeal allowed. "Pecuniary interest" under Act is restricted to finan- cial, monetary, or economic interest. Appellant conceded that SF had indirect pecuniary interest in outcome of DB ap- peal. Application judge erred in approach to s. 4(k) by read- ing in rebuttable presumption that unless proven otherwise, councillor is fixed with same level of proximity and sig- nificance as child. Test under s. 4(k) is whether reasonable elector, being apprised of all circumstances, would be more likely than not to regard inter- est of councillor as likely to in- f luence that councillor's action and decision. Application judge failed to apply relevant analysis. Relevant factors included ap- pellant's many years of faith- ful service to municipality, his good faith motivation to par- ticipate in issues, his vigilance in declaring conf licts of inter- est under Act, fact that matters related to plan were of major public interest to his constitu- ents, that appellant receives no benefit from SF's compensation and that SF's compensation and employment do not depend on outcome of DB appeal or any decision of council respect- ing these matters. Reasonable elector apprised of all circum- stances would not conclude that appellant's deemed interest would be likely to inf luence his participation in debate or vot- ing on matter before council. Ferri v. Ontario (Ministry of At- torney General) (Oct. 8, 2015, Ont. C.A., E.A. Cronk J.A., M. Tulloch J.A., and C.W. Hou- rigan J.A., File No. CA C60766) Decision at 256 A.C.W.S. (3d) 951 was reversed. 258 A.C.W.S. (3d) 209. Professions BARRISTERS AND SOLICITORS Motion judge did not err in finding that estimate of fees did not amount to represen- tation of fact or promise Defendant represented female plaintiff in human rights com- plaint that she brought relating to termination of her employ- ment. He settled complaint on terms that were favourable to plaintiffs. Plaintiffs were un- happy with defendant's fee, which was more than estimate that he had given. Female plain- tiff fired defendant before set- tlement was finalized and then took steps to have his account assessed. In following two years, plaintiffs commenced number of proceedings relat- ing to defendant's account. In current action, plaintiffs sued defendant and LawPro alleg- ing defendant made fraudulent misrepresentation when he agreed to cap his fee at $30,000 but subsequently charged more than that amount. LawPro brought motion to strike state- ment of claim as disclosing no reasonable cause of action against it. Defendant brought motion to dismiss action on grounds it was frivolous, vexa- tious or abuse of process. Mo- tions judge granted both mo- tions. Plaintiffs' appealed. Ap- peal dismissed. Motions judge correctly found that no duty of care existed between insurer and party adverse in interest to its insured. Motions judge did not err in finding that action was brought by plaintiffs to provide leverage in their appli- cation for assessment of defen- dant's account. Nor did he err when he found that estimate of fees did not amount to repre- sentation of fact or promise and no reasonable person could find that defendant intended to mislead when he gave estimate of his fees. Plaintiffs acknowl- edged that quoted fee was only estimate. Mitchinson v. Baker (Sep. 17, 2015, Ont. C.A., E.E. Gil- lese J.A., S.E. Pepall J.A., and M.L. Benotto J.A., File No. CA C59535) 258 A.C.W.S. (3d) 218. Torts MISFEASANCE IN PUBLIC OFFICE Issuance of inspection orders was not misfeasance in public office Two buildings were con- structed in 1988 to standards of 1986 Building Code. Fire department issued two inspec- tion orders against plaintiff directing plaintiff to upgrade fire alarm systems in two resi- dential buildings to bring sys- tems in line with Ontario Fire Marshal's Technical Guideline. Plaintiff appealed inspection orders to Officer of Fire Mar- shal and then to Fire Safety Commission. Fire department rescinded inspection orders prior to appeal to Commis- sion. Fire department did not participate in appeal or on judi- cial review in Divisional Court where inspection orders were set aside. Plaintiff claimed, inter alia, issuance of inspec- tion orders was misfeasance in public office. Action dismissed. There was no evidence that defendants intended to harm plaintiff by issuing inspection orders. Misfeasance in pub- lic office was not made out by there being some doubt as to whether decision made was correct. Defendants believed they were authorized to issue inspection orders and acted in good faith. Defendants did not knowingly act unlawfully and they were not reckless or will- fully blind as to whether they were acting unlawfully. Defen- dants relied appropriately on advice of OFM. If defendants erred in use of guideline, it was error of law made in good faith. It was not misfeasance to withdraw from litigation where it was believed to be in public interest and where there was no intention of evading supervision of courts. Defen- dants also not negligent either in issuing inspection orders or in not seeking outside legal counsel before they did. Plain- tiff was in sufficient proximity to fire department to be owed duty of care by city. Defendants acted in good faith and sought guidance of OFM through- out. There was no obligation to pursue solicitor's opinion on enforceability of inspection orders and fire department was not bound to accept any advice received from counsel. Norquay Developments Ltd. v. Kasprzyk (Sep. 10, 2015, Ont. S.C.J., B.W. Miller J., File No. 2182/10) 258 A.C.W.S. (3d) 244. LT CASELAW

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