{"id":17282,"date":"2021-05-06T12:27:56","date_gmt":"2021-05-06T17:27:56","guid":{"rendered":"https:\/\/www.rsslex.com\/publications\/the-wellington-application-and-the-right-to-choose-ones-lawyer\/"},"modified":"2022-01-09T21:32:49","modified_gmt":"2022-01-10T02:32:49","slug":"20210506_the-wellington-application-and-the-right-to-choose-ones-lawyer","status":"publish","type":"post","link":"https:\/\/www.staging.rsslex.com\/en\/bulletins-en\/20210506_the-wellington-application-and-the-right-to-choose-ones-lawyer\/","title":{"rendered":"The Wellington Application and the Right to Choose One\u2019s Lawyer"},"content":{"rendered":"

<\/p>\n

In Pelletier c. Gauthier<\/i> (Decision issued April 13, 2021 by the Honourable Jocelyn Pilote, j.c.s., C.S. \u2013 150-17-004304-207), defendants Gauthier et Simard filed a Wellington application against Intact Compagnie d\u2019assurance and Desjardins Assurances g\u00e9n\u00e9rales as impleaded parties, requesting only the right to select their lawyer.<\/p>\n

Defendants were sued on the basis of alleged latent defects in a house that they sold. They were covered by insurance policies issued respectively by Intact and Desjardins.<\/p>\n

In letters dated February 8 and 11, 2021, the insurers confirmed to their insureds that they would assume their whole defence<\/i>. However, given the allegations about the repairs of latent defects and misleading and false representations in the originating application, they reserved their rights regarding the indemnity.<\/p>\n

Before the Court, defendants argued that the bulk of plaintiff\u2019s claims did not fall within the scope of the policies and that, accordingly, the lawyer that they had initially retained for their defence had to be allowed to remain in charge of the case, at the insurers\u2019 expense. They argued that if the insurers could select the lawyer, there was a risk that the defence would focus on the elements not covered or excluded, since the lawyer would be in a loyalty conflict. Moreover, they suggested that, considering the reservation of rights letters, this risk was predominant.<\/p>\n

The insurers argued that the text of the policies and the law are clear: they are allowed to select the lawyer who would lead the defence. They referred to Zurich du Canada, compagnie d\u2019indemnit\u00e9 c. Renaud & Jacob<\/i>,\u00a01996 CanLII 5801<\/a> (QCCA), rendered in 1996 by the Court of Appeal, the leading case on the matter.<\/p>\n

The defendants\u2019 application was dismissed: the right to select the lawyer appearing for the defence belongs to the insurers.<\/p>\n

In his decision, Justice Jocelyn Pilote cites with approval an excerpt from the Zurich<\/i> case:<\/p>\n\n\n\n
<\/td>\n[\u2026] it is impossible to take for granted [\u2026] that legal relationships established under a liability insurance contract towards the performance of the obligation to defend imply the right of the insured to take control of his defence as soon as the insurer declares its intention to reserve its rights regarding the obligation of compensation<\/strong>, should the evidence demonstrate the absence of coverage.<\/p>\n[\u2026]\n

We must find more than a mere apprehension<\/strong> that the insurer’s performance of its defence obligation will be influenced by its interest in obtaining recognition of an exclusion. Instead, the study of the conflict of interest must focus on the lawyer on the case and highlight inconsistencies in his mandate or the instructions he received as to its execution.<\/p>\n

Analyzing this issue will reveal at the outset that, under a liability insurance policy, the conduct of the defence is the insurer\u2019s prerogative. This right is given as counterpart to the obligation to pay for this defence. This right is contractually recognized by the insured from the outset, as a clear distinction between the obligations to defend and to compensate. It creates a situation where, from the outset of the debate, the insured accepts that his lawyer has a form of dual mandate<\/strong>. Within it, he remains under a duty towards the insured to abide by all normal ethical obligations<\/strong> […] [Pelletier c. Gauthier<\/i>, par. 17; our emphasis and translation]<\/td>\n

<\/td>\n<\/tr>\n<\/tbody>\n<\/table>\n

Moreover, according to the judge, the fact pattern of Zurich<\/i> is different from that in Aviva, compagnie d\u2019assurances du Canada c. Construction et pavage Dujour It\u00e9e<\/i>,\u00a02015 QCCS 4173<\/a>, a precedent cited by the defendants in support of their position. In that case, the insurer had conducted an investigation, and informed the insured that the facts led to a denial of coverage. In this case, in their February 2021 letters, the insurers refer to the clauses in their policies in relation only to the allegations of the claim, without a mention of any investigation.<\/p>\n

The judge adds that nothing could lead him to conclude that the lawyers acting for the defence in this case had been involved in the analysis of the coverage, adding that there was no allegation that they could be facing a real conflict of interest.<\/p>\n

Finally, Mr. Justice Pilote mentions that the reservation of rights in the insurers\u2019 letters did not go beyond what is usually found in such circumstances.<\/p>\n

Mr. Nadeau was representing Intact assurances and Desjardins assurances and in that case.<\/p>\n","protected":false},"excerpt":{"rendered":"

In Pelletier c. Gauthier (Decision issued April 13, 2021 by the Honourable Jocelyn Pilote, j.c.s., C.S. \u2013 150-17-004304-207), defendants Gauthier et Simard filed a Wellington application against Intact Compagnie d\u2019assurance and Desjardins Assurances g\u00e9n\u00e9rales as impleaded parties, requesting only the right to select their lawyer. Defendants were sued on the basis of alleged latent defects […]<\/p>\n","protected":false},"author":18,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[242,50],"tags":[],"class_list":["post-17282","post","type-post","status-publish","format-standard","hentry","category-insurance-law-en","category-bulletins-en"],"acf":[],"yoast_head":"\nThe Wellington Application and the Right to Choose One\u2019s Lawyer - STAGING - RSS - Robinson Sheppard Shapiro<\/title>\n<meta name=\"robots\" content=\"noindex, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Wellington Application and the Right to Choose One\u2019s Lawyer - STAGING - RSS - Robinson Sheppard Shapiro\" \/>\n<meta property=\"og:description\" content=\"In Pelletier c. 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