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Apportioning defence costs at start of litigation

Thursday, March 23, 2017 @ 8:00 PM | By Nina Bombier and Lars Brusven

As the cost of complex litigation grows, the allocation of legal defence costs at the initial stages of litigation has become an increasingly important issue.

Issues arise as to whether an insurer must pay all of an insured’s defence costs of “mixed” claims alleging both covered and non-covered liabilities. Similarly, disputes arise as to how to allocate defence costs among various insurers and insured parties for losses extending over lengthy periods of times or where there are periods of no coverage.

The “duty to defend” clause...