In 2016, Canadian courts issued a number of decisions that will
have an impact on the landscape of insurance litigation. With the
beginning of a new year, we take this opportunity to reflect on
some of those key decisions, and the lessons insurers can draw from
them.
1. False representations by the insured
The Quebec Court of Appeal
held that an insurer may cancel an insurance policy based on false
representations made by the insured even when the policy is
required by law. As a result, an injured third party could see its
claim against the insurer rejected. The case involved the
retirement planning of a couple who entrusted their money, through
their holding companies, with brokerage firm Triglobal Capital
Management. A portion of these funds was inadequately used by
Triglobal's president in running a Ponzi scheme through the
firm using offshore funds in the Bahamas and the Cayman Islands.
Triglobal's liability insurer, Axa Insurance Company,
considered the
