Reasons for judgement were released today by the BC Supreme Court, Vancouver Registry, dismissing arguments by the Manufacturer’s Life Insurance Company attempting to have a former in-house lawyer of theirs acting as plaintiff counsel in a breach of contract claim against them.
In today’s case (McMyn v. Manufacturer’s Life Insurance Company) the insurer argued that, as a former in-house lawyer, Plaintiff’s counsel had knowledge of their “business practices, litigation strategies, insurance policies and certain claims personnel” and it would be unfair to allow him to now use this knowledge against them.
In dismissing the application Mr. Justice Myers provided the following reasons:
 With respect to the claim for LTD benefits, it is up to the plaintiff to show that she fell within the terms of the policy. The terms of the policy are certainly not secret. It cannot be argued or assumed that Manulife has some secret interpretation of the policy that Mr. Fishman has knowledge of. It is hard to see that knowledge of the claims people would have any effect on Mr. Fishman’s train of inquiry on that issue, including the handling of examinations for discovery. As in most LTD claims the real issue will no doubt be – and no one argued otherwise – Ms. McMyn’s medical condition and how that fits into the wording of the policy.
 With respect to the bad faith claim, the plaintiff must show a failure of Manulife to act with reasonable promptness or a failure to deal with the insured fairly: 702535 Ontario Inc. v. Non-Marine Underwriters, Lloyd’s London, England,  O.J. No. 866 (Ont. C.A.). That will obviously depend on the way this claim was handled based on the evidence in this case. Knowledge of how the claims people may have handled past claims will be of little or no assistance.
 Manulife argued that Mr. Fishman has insight into how the claims people or Mr. Lizé perform in examinations for discovery. That might be true. But it must be put into perspective. First, in terms of witnesses selected for examination for discovery or at trial, the relevant witnesses are those that have familiarity with the facts of the claim. That is something that any lawyer would be able to ascertain through document discovery or interrogatories. Mr. Fishman has no inside knowledge of that because he was not at Manulife when the plaintiff filed her claim.
 Knowledge of how Manulife personnel perform in examinations for discovery might provide a minor advantage. But any lawyer who had previously done an examination for discovery or cross-examination in trial of that witness would also have that insight. It is to be borne in mind that Manulife as a major LTD insurer in Canada is an institutional litigator. This is not a one-off claim being made against it. Any lawyer specialising in LTD claims would be expected to act against Manulife multiple times and most likely come up against the same Manulife personnel.
 Insofar as Mr. Fishman being aware of Manulife’s claims handling procedures, once again he has been gone from the company for over two years. The issue will be the way this claim is handled. If there are Manulife claims handling manuals their existence will come out in the examinations of discovery conducted by any counsel.
 In Sandhu the Court noted, at para. 32, that the approach to this type of application is a “cautious one” and that the court should only interfere in “clear cases”. While the Court of Appeal disqualified the lawyer, this case comes nowhere near to the facts in that case, where the lawyer had knowledge of confidential information pertaining directly to her new client.
 Regarding Mr. Fishman having handled bifurcation applications, Manulife said Mr. Fishman is aware of Manulife’s preference for bifurcation of bad faith claims. So would any lawyer who was previously on the receiving end of that type of application from Manulife. In this case, the simple fact is that Manulife will make the application or it will not. I fail to see what confidential strategy could have been involved in bifurcation claims that would give Mr. Fishman an advantage.
 Finally, I do not place any significant weight on Mr. Lizé having been appointed as the case manager on this file. He was not appointed until after Manulife knew that Mr. Fishman was acting on the case. Manulife also appointed Mr. Lizé as the case manager on the Galley action. Manulife says it would be inconvenient to appoint another case manager, because they would have to come from out of town for discoveries, trial or meetings. However, for a company the size of Manulife that must be a small consideration.
 In Atco, the Court concluded that the case the lawyer was acting on against Atco was sufficiently connected to the work he had done at Atco to raise the rebuttable presumption that he had confidential information pertaining to the new retainer. The connections in that case were more direct than the ones here. In Atco the lawyer knew all of the data and other corporate information relevant to Atco’s rate applications. Here, there is only a general knowledge of claims practices and company personnel.
 I conclude that the connections between this case and the work Mr. Fishman did at Manulife are not sufficient to raise the presumption that he had obtained confidential information that could be used in this case.