The Court held that the excess insurers were not responsible for the defence costs. The excess insurers were not made privy to the details of the proposed settlement.

Hollinger International Inc. v. American Home Assurance Co., [2006] O.J. No. 1791, Ontario Superior Court of Justice

The application before the Court concerned the issue of defence costs flowing from a settlement of a shareholder derivative action brought against Hollinger International and funded by two primary insurers. The primary insurers took the position that to the extent that the settlement and defence costs exceeded US$50 million, such excess should be covered by the excess insurers.

The Court, in concluding that the excess insurers were not responsible for the defence costs, noted that the excess insurers were not made privy to the details of the proposed settlement.

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