Tick Tock: Time Is Of The Essence For Insurers To Raise Coverage Concerns

• Published date: 06 October 2025
• Law Firm: CLC (Canadian Litigation Counsel)
• Author: Neil Zimmerman (Brownlee LLP) and Jayden Wlasichuk (Brownlee LLP)

On September 8, 2025, the Federal Court released its decision in Elite Insurance Company (Aviva) v Borgatti Estate, 2025 FC 1471, where the Court rejected Aviva's application for summary judgement seeking to deny coverage for claims against the Estate relating to a fatal boating accident from 2019 (the "Collision"). The Court held that Aviva was estopped from denying coverage to the Estate after Aviva delayed and took steps that prejudiced the Estate's access to evidence, including disposing of the boat before advising the Estate the boat's lights could be the basis for denying coverage.

Aviva sought declarations that losses and claims asserted in various litigation claims against the Estate relating to the Collision were not covered by the Policy and that Aviva owed no contractual indemnity to the Defendants under the Policy's terms and conditions. Aviva argued that insurance coverage under the Policy had ceased at the time of the Collision, because Mr. Borgatti was in breach of the Safety Equipment Warranty (the "Warranty").

The Defendants argued that Aviva should be prohibited from denying coverage under the Policy due to the operation of the doctrines of waiver, estoppel, and laches. The Defendants also argued that the Warranty did not apply to navigation lights. In the alternative, the Defendants argued that subsections 39(3) and 39(4) of the...