At our muffin meeting this morning, Matthew Umbrio discussed an interesting Small Claims Court decision in St. Lawrence Testing & Inspection Co. Ltd. v Lanark Leeds Distribution Ltd., 2019 CanLII 69697 (ON SCSM).
The defendants brought a motion for judgment confirming that the terms of settlement had been satisfied. This was following an apparent “cybercrime”, where a fraudster hacked the account of the plaintiff’s representative and sent revised payment instructions vie e-mail to the defendants regarding settlement funds, such that the defendants sent payment to the fraudster’s account rather than that of the plaintiff’s law firm. The funds were not recovered.
The Deputy Judge determined that the defendants failed to follow the terms of settlement in complying with the fraudster’s instructions, in the circumstances of the case. He found that the plaintiff’s firm was not negligent with respect to computer/e-mail security. As such, the defendants had to bear the loss.
Micah Pirk O’Connell addressed the Superior Court decision of MacFarlane v. Canadian Universities Reciprocal Insurance Exchange, 2019 ONSC 463, a duty to defend application.
The applicant, a university law professor, brought an application against the university’s insurer for a declaration that the insurer had a duty to defend her in a defamation action brought against her by a former colleague. The university itself was not named as a party in the defamation suit.
Justice Kimmel granted the application, finding that the professor was an “additional insured” under the policy. The insurer thus had a duty to defend the professor in the defamation action, with the insurer bearing the right to appoint counsel.