Dyne Holdings Ltd. et al. v. Royal Insurance Co. of Canada et al., (1996) 138 Nfld. & P.E.I.R. 318 (PEICA)

• Case Date: March 12, 1996
• Jurisdiction: Prince Edward Island
• Citations: (1996), 138 Nfld. & P.E.I.R. 318 (PEICA)

Dyne Holdings v. Royal Ins. (1996), 138 Nfld. & P.E.I.R. 318 (PEICA);

    431 A.P.R. 318

MLB headnote and full text

Dyne Holdings Limited and Michael H. Arnold (appellants) v. Royal Insurance Company of Canada, The Continental Insurance Company of Canada and Commercial Union Assurance Company (respondents)

(AD-0615)

Indexed As: Dyne Holdings Ltd. et al. v. Royal Insurance Co. of Canada et al.

Prince Edward Island Supreme Court

Appeal Division

Carruthers, C.J.P.E.I., Mitchell, J.A., and MacDonald, C.J.T.D.(ad hoc)

March 12, 1996.

Summary:

A plaintiff sued an insured for damages making allegations of conspiracy and per­sonal injury. The insured applied for a de­claratory order requiring three insurers to defend.

The Prince Edward Island Supreme Court, Trial Division, in a decision reported 127 Nfld. & P.E.I.R. 211; 396 A.P.R. 211, dis­missed the application. The insured appealed.

The Prince Edward Island Court of Appeal allowed the appeal and held that two of the insurers were under a duty to defend the action.

Insurance - Topic 725

Insurers - Duties - Duty to defend - A plaintiff sued an insured for property dam­age allegedly caused by civil conspiracy and interference with contractual relations - The plaintiff also claimed personal dam­ages, alleging that the insured received privileged information from the plaintiff's former solicitor and used it without con­sent to the plaintiff's detriment - The trial court refused to grant a declaratory order requiring the insured's three insurers to defend the action - The allegations of conspiracy involved intent which was excluded under the policies - The personal injury allegations were insufficiently pleaded to invoke the policies' provisions pertaining to personal injury (i.e., breach of the right of privacy) - The Prince Edward Island Court of Appeal allowed an appeal and ruled that two of the insurers were obliged to defend the action.

Insurance - Topic 6863

Liability insurance - Business, compre­hensive policy - Extent of coverage - A plaintiff sued an insured for, inter alia, personal damages, alleging that the insured received privileged information from the plaintiff's former solicitor and used it without consent to the plaintiff's detriment - The issue arose as to whether an action for disparagement of goods could be maintained distinct from an action for defamation - The Prince Edward Island Court of Appeal stated that "[i]t, therefore, appears that the appellants are right in stating that they can maintain an action for disparagement of goods which is distinct and apart from an action for defamation as disparagement of goods is not concerned with injury to personal reputation" - See paragraph 39.

Libel and Slander - Topic 8201

Slander of title - General - Disparagement of goods - [See Insurance - Topic 6863 ].

Practice - Topic 9012

Appeals - Restrictions on argument on appeal - Issues or points not raised on application, at trial, in pleadings or in prior proceedings - A plaintiff sued an insured - The three insurers (Royal, Continental and Commercial) declined to defend the action - The insured sued the insurers to compel them to defend the action - The insurers submitted that the plaintiff's action was not covered by the policies - Com­mer­cial also claimed that the exclu­sions clause exempted it from liabil­ity - The trial court ruled that the insurers did not have to defend the claim - The insured appealed the decision except for the part regarding Commercial's exemption clause - At the appeal hearing, Royal and Conti­nental attempted to raise their exclu­sion clauses as a defence - However, nei­ther Royal nor Continental had served notice of a cross-appeal nor had sought leave to be heard on the issue - The Prince Edward Island Court of Appeal declined to allow Royal and Continental to take advantage of their exclusion clauses - See paragraphs 65 to 76.

Practice - Topic 9164

Appeals - Cross appeals, notices of con­tention and notices to vary - Filing of - Effect of failure to file - [See Practice - Topic 9012 ].

Torts - Topic 5401

Invasion of privacy - General - The Prince Edward Island Court of Appeal considered the nature of a cause of action for breach of privacy and whether such an action was recognized at common law - See paragraphs 45 to 64.

Cases Noticed:

Nichols v. American Home Assurance Co. et al., [1990] 1 S.C.R. 801; 107 N.R. 321; 39 O.A.C. 63, appld. [para. 16].

Bacon v. McBride (1984), 6 D.L.R.(4th) 96 (B.C.S.C.), refd to. [para. 16].

Opron Maritimes Construction Ltd. v. Canadian Indemnity Co. (1986), 73 N.B.R.(2d) 389; 184 A.P.R. 389 (C.A.), consd. [para. 16].

Ontario v. Kansa General Insurance Co. (1994), 69 O.A.C. 208; 111 D.L.R.(4th) 757 (C.A.), consd. [para. 18].

White v. Mellin, [1895] A.C. 154 (H.L.), refd to. [para. 42].

Ratcliffe v. Evans, [1892] 2 Q.B. 524 (C.A.), refd to. [para. 42].

Hein v. Canadian Fairbanks Morse Co. and Burrows, [1938] 4 D.L.R. 63 (N.B.C.A.), refd to. [para. 42].

Saccone v. Orr (1981), 34 O.R.(2d) 317 (Co. Ct.), consd. [para. 49].

X (A Minor), Re (Wardship: Restriction on Publi­cation), [1975] 1 All E.R. 697 (C.A.), consd. [para. 51].

Krouse v. Chrysler Canada Ltd., [1970] 3 O.R. 135 (H.C.), refd to. [para. 54].

Burnett v. R. (1979), 94 D.L.R.(3d) 281 (Ont. H.C.), refd to. [para. 54].

Capan v. Capan (1980), 14 C.C.L.T. 191 (Ont. H.C.), refd to. [para. 54].

Motherwell v. Motherwell (1976), 1 A.R. 47; 73 D.L.R.(3d) 62 (C.A.), refd to. [para. 55].

Bingo Enterprises Ltd. et al. v. Price Wat­erhouse (1986), 41 Man.R.(2d) 19; 26 D.L.R.(4th) 604 (C.A.), leave to appeal refused (1986), 74 N.R. 236; 46 Man.R.(2d) 160 (S.C.C.), consd. [paras. 56, 58].

Bingo Enterprises Ltd. et al. v. Plaxton et al. - see Bingo Enterprises Ltd. et al. v. Price Waterhouse.

Roth v. Roth (1991), 4 O.R.(3d) 740 (Gen. Div.), refd to. [para. 59].

R. v. O'Connor (H.P.) (1995), 191 N.R. 1; 68 B.C.A.C. 1; 112 W.A.C. 1 (S.C.C.), consd. [para. 61].

Dandy Duds Ltd. v. Commercial Union Assurance Co. of Canada et al. (1989), 75 Nfld. & P.E.I.R. 212; 234 A.P.R. 212 (P.E.I.C.A.), consd. [para. 72].

Statutes Noticed:

Rules of Court (P.E.I.), Supreme Court Rules, rule 61.05(1)(c), rule 61.05(3) [para. 70].

Authors and Works Noticed:

Fridman, G.H.L., The Law of Torts in Canada (1990), vol. 2, p. 192 [para. 51].

Gatley, Libel and Slander (8th Ed. 1981), pp. 68, para. 69 [para. 37]; 132, para. 301 [para. 38]; 304, para. 306 [para. 39]; 308, paras. 307, 308 [para. 40]; 318, paras. 317, 318 [para. 41].

Halsbury's Laws of England (4th Ed.), vol. 28, p. 128, paras. 261, 262, 263, 267 [para. 42].

Linden, Allen M., Canadian Tort Law (5th Ed. 1993), pp. 52 to 53 [para. 53].

Counsel:

Sean J. Casey and Barbara E. Smith, for the appellants;

Patrick L. Aylward, for the respondent, Royal Insurance Co. of Canada;

J. Gordon MacKay, Q.C., for the Continental Insurance Co. of Canada;

Henry J. Murphy, for the Commercial Union Assurance Co.

This appeal was heard on November 14, 1995, before Carruthers, C.J.P.E.I., Mitchell, J.A., and MacDonald, C.J.T.D.(ad hoc), of the Prince Edward Island Supreme Court, Appeal Division.

On March 12, 1996, Carruthers, C.J.P.E.I., delivered the following judgment for the Court of Appeal.