Clark, Drummie & Co. v. Law Society of New Brunswick, (1993) 138 N.B.R.(2d) 332 (TD)

JudgeJones, J.
CourtCourt of Queen's Bench of New Brunswick (Canada)
Case DateJuly 14, 1993
JurisdictionNew Brunswick
Citations(1993), 138 N.B.R.(2d) 332 (TD)

Clark, Drummie v. N.B. Law Soc. (1993), 138 N.B.R.(2d) 332 (TD);

    138 R.N.-B.(2e) 332; 354 A.P.R. 332

MLB headnote and full text

[French language version follows English language version]

[La version française vient à la suite de la version anglaise]

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Clark, Drummie & Company (applicant) v. The Law Society of New Brunswick (respondent)

(S/M/125/93)

Indexed As: Clark, Drummie & Co. v. Law Society of New Brunswick

New Brunswick Court of Queen's Bench

Trial Division

Judicial District of Saint John

Jones, J.

September 14, 1993.

Summary:

A law firm carried professional liability insurance through the New Brunswick Law Society and presented a claim for coverage for an incident involving a conversion of funds by an associate, for which the firm members were held liable. The Law Society denied coverage, contending that the claim was not covered by the policy. The matter was sub­mitted to an arbitrator. The arbitrator found that the policy did not cover the law firm. The law firm applied for judi­cial review of the arbitrator's decision.

The New Brunswick Court of Queen's Bench, Trial Division, dismissed the appli­cation.

Insurance - Topic 1861

The insurance contract - Interpretation of contract - Contra proferentem rule - The New Brunswick Court of Queen's Bench, Trial Division, held that the prin­ciple of contra proferentem rests upon the exist­ence of an ambiguity and was not applicable in a case involving the interpretation of an insur­ance policy, where there was no ambi­guity in the wording of the policy - See paragraph 22.

Insurance - Topic 7664

Professional liability insurance - Defences and exclusions - Exclusions - General - A law firm claimed under its professional liability insurance for an incident involving a conversion of funds by an associate, for which the firm members were held liable -The insurer denied coverage, relying on an exclusion that the policy did not apply to theft or misappro­priation of client trust funds - An arbitra­tor found that the policy did not cover the firm - The firm applied for judicial review - The New Brunswick Court of Queen's Bench, Trial Division, held that the arbi­trator's interpretation of the policy was correct.

Insurance - Topic 7664

Professional liability insurance - Defences and exclusions - Exclusions - General - A law firm claimed under its professional liability insurance after a conversion of funds by an associate - The insurer denied coverage, relying on an exclusion that the policy did not apply to theft or misappro­priation of client trust funds - An arbitra­tor found that the policy did not cover the firm - The firm argued that the exclu­sion could not apply because the loss was caused in part by the negli­gence of another party - The New Bruns­wick Court of Queen's Bench, Trial Divi­sion, agreed with the arbitrator that the as­soc­iate's conver­sion of funds was the proxi­mate cause of the loss and that where there was more than one cause, and one fell within the exclusion, the loss would be excluded.

Cases Noticed:

Clark's Chick Hatchery Ltd. v. Common­wealth Insurance Co. (1982), 40 N.B.R.(2d) 87; 105 A.P.R. 87 (C.A.), refd to. [para. 25].

Counsel:

G. Fred Nicholson, Q.C., for the applicant;

David N. Norman, Q.C., for the respon­dent.

This application was heard on July 14, 1993, before Jones, J., of the New Bruns­wick Court of Queen's Bench, Trial Divi­sion, Judicial District of Saint John, who delivered the following decision on Septem­ber 14, 1993.

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2 practice notes
  • Brown v. Atlantic Insurance Co., (1996) 142 Nfld. & P.E.I.R. 259 (NFTD)
    • Canada
    • Newfoundland and Labrador Supreme Court of Newfoundland and Labrador (Canada)
    • May 8, 1996
    ...Nfld. & P.E.I.R. 240; 185 A.P.R. 240 (Nfld. T.D.), dist. [para. 20]. Clark, Drummie & Co. v. Law Society of New Brunswick (1993), 138 N.B.R.(2d) 332; 354 A.P.R. 332 (T.D.), dist. [para. Clark's Chick Hatchery Ltd. v. Commonwealth Insurance Co., [1982] I.L.R. 704; 38 N.B.R.(2d) 189; ......
  • New Brunswick Power Corp. v. Canadian Lawyers Insurance Association, (1996) 184 N.B.R.(2d) 329 (TD)
    • Canada
    • New Brunswick Court of Queen's Bench of New Brunswick (Canada)
    • January 2, 1996
    ...Bench, Trial Division, dismissed the client's action. Cases Noticed: Clark Drummie & Co. v. Law Society of New Brunswick (1993), 138 N.B.R.(2d) 332; 354 A.P.R. 332 (T.D.), refd to. [para. Authors and Works Noticed: Brown and Menezes, Insurance Law in Canada (1st Ed. 1982), p. 194 [para.......
2 cases
  • Brown v. Atlantic Insurance Co., (1996) 142 Nfld. & P.E.I.R. 259 (NFTD)
    • Canada
    • Newfoundland and Labrador Supreme Court of Newfoundland and Labrador (Canada)
    • May 8, 1996
    ...Nfld. & P.E.I.R. 240; 185 A.P.R. 240 (Nfld. T.D.), dist. [para. 20]. Clark, Drummie & Co. v. Law Society of New Brunswick (1993), 138 N.B.R.(2d) 332; 354 A.P.R. 332 (T.D.), dist. [para. Clark's Chick Hatchery Ltd. v. Commonwealth Insurance Co., [1982] I.L.R. 704; 38 N.B.R.(2d) 189; ......
  • New Brunswick Power Corp. v. Canadian Lawyers Insurance Association, (1996) 184 N.B.R.(2d) 329 (TD)
    • Canada
    • New Brunswick Court of Queen's Bench of New Brunswick (Canada)
    • January 2, 1996
    ...Bench, Trial Division, dismissed the client's action. Cases Noticed: Clark Drummie & Co. v. Law Society of New Brunswick (1993), 138 N.B.R.(2d) 332; 354 A.P.R. 332 (T.D.), refd to. [para. Authors and Works Noticed: Brown and Menezes, Insurance Law in Canada (1st Ed. 1982), p. 194 [para.......

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