Published June 2009

Much legal literature has addressed the liability insurer’s “duty” to defend law suits against their insureds. The material tends to focus on the rights and obligations of the insurer and the insured respectively. The terms of the contract (the policy) between the parties drive much of the analyses. When is the duty to defend triggered? Who appoints and instructs defence counsel? How do the conflicts of interest between insurer and insured get addressed? Invariably, the policy is silent about such conflicts. Occasionally the Court will be called upon to fashion a remedy but more often than not the parties will themselves devise a handling protocol to muddle through, hoping for some compromise outcome in the underlying suit that will avoid the conflict coming to the fore.

This paper is not focused on the insurer–insured relationship, but rather on the professional and ethical obligations of the third player in the “tripartite” relationship, namely, defence counsel. More specifically, this paper will focus on the professional conduct rules and directions of the Law Societies, particularly the Law Society of British Columbia (“LSBC”). As we will see, defence counsel is obliged to walk an ethical tightrope and confront significant professional discipline exposure.

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