The Owners, Strata Plan EPS1544 v. Royal & Sun Alliance Insurance Company of Canada and in French, Royal & Sun Alliance du Canada, Societe D'Assurances

2026 BCSC 889 The Owners, Strata Plan EPS1544 v. Royal & Sun Alliance Insurance Company of Canada and in French, Royal & Sun Alliance du Canada, Societe D'Assurances IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: The Owners, Strata Plan EPS1544 v. Royal & Sun Alliance Insurance Company of Canada and in French, Royal & Sun Alliance du Canada, Societe D'Assurances, 2026 BCSC 889 Date: 20260514 Docket: S-1813820 Registry: Vancouver Between: The Owners, Strata Plan EPS1544 Plaintiff And: Royal & Sun Alliance Insurance Company of Canada and in French, Royal & Sun Alliance Du Canada, Societe D'Assurances, WBI Home Warranty Ltd. MWP Construction Inc., Bynett Construction Solutions Inc., Bynett Construction Services Ltd., Bynett Holdings Ltd., Mountain West Properties Inc., 1011 Limited Partnership, 1011 Management Inc., Patricia Lynn Anderson, Glover-Drennan Inc., Kenneth Glover, Low Hammond Rowe Architects Inc., formerly Chow Low Hammond Architects Inc., Sid Chow, Milestone Equipment Contracting Inc., John Doe Contractor #1, Proline Roofing Ltd., Chouinard Exterior Wall Systems Ltd., Alex-Evan Joseph Chouinard dba Chouinard Exterior Wall Systems, Olde Country Masonry Ltd., Alliston Stoneworks Ltd., Bryce Colin Alliston dba Alliston Stoneworks, K & S Railings Ltd., Starline Windows (2001) Ltd., Allied Glass and Aluminium Products (2007) Ltd., Home Lumber & Building Supplies (a Firm), Kone Inc., City Service Plumbing Ltd., Grant Howell dba City Service Plumbing, City of Victoria, Bryce Colin Alliston dba Alliston Stoneworks and Bynett Residential Construction Inc. Defendants And: MWP Construction Inc., Bynett Construction Solutions Inc., Bynett Construction Services Ltd., Bynett Holdings Ltd., Mountain West Properties Inc., 1011 Limited Partnership, 1011 Management Inc., Patricia Lynn Anderson, Low Hammond Rowe Architects Inc., formerly known as Chow Low Hammond Architects Inc., Sid Chow, Milestone Equipment Contracting Inc., John Doe Contractor #1, Proline Roofing Ltd., Chouinard Exterior Wall Systems Ltd., Alex-Evan Joseph Chouinard dba Chouinard Exterior Wall Systems, Olde Country Masonry Ltd., Allistone Stoneworks Ltd., K & S Railings Ltd., Starline Windows (2001) Ltd., Allied Glass and Aluminium Products (2007) Ltd., Home Lumber & Building Supplies (a Firm), Kone Inc., City Service Plumbing Ltd., Grant Howell dba City Service Plumbing, City of Victoria, Bryce Colin Alliston dba Alliston Stoneworks and Bynett Residential Construction Inc. Third Parties Before: The Honourable Justice J. K. Gibson Reasons for Judgment Counsel for the Plaintiff: J. C. MacInnis, K.C. as Agent for S. D. Harwood Counsel for the Applicants/Defendants/Third Parties Low Hammond Rowe Architects Inc., formerly known as Chow Hammond Architects Inc. and Sid Chow: S. H. Haakonson Counsel for the Defendants/Third Parties Royal & Sun Alliance Insurance Company of Canada and in French, Royal & Sun Alliance du Canada, Societe D'Assurances and WBI Home Warranty Ltd.: A. Maltas E. Saul, A/S Counsel for the Defendant/Third Party Starline Windows (2001) Ltd. D. Pawa Counsel for the Defendant/Third Party City of Victoria (by videoconference): L. Soproniuk Place and Date of Hearing: Vancouver, B.C. December 17 and 18, 2025 Place and Date of Judgment: Vancouver, B.C. May 14, 2026 Table of Contents Overview.. 4 Background.. 6 The January 24, 2023 Receivership Funds Agreement. 11 Issue. 13 Law.. 13 Discussion.. 13 Conclusion and Orders. 19 Overview [1] This action arises from the design and construction of a condominium complex in Victoria, B.C. (the "Condominium"). The plaintiff, the Owners, Strata Plan EPS 1544 (the "Strata") claims against various parties involved in the Condominium's design and construction, who allegedly created defects causing loss and damage. The claim also joins the insurer defendant Royal & Sun Alliance Insurance Company of Canada ("Royal & Sun") and the warranty provider defendant WBI Home Warranty Limited ("WBI"), advancing a separate breach of warranty claim against them arising from the warranty policy issued to the Strata for the Condominium (the "2-5-10 Warranty"). [2] The applicants/defendants/third parties Low Hammond Rowe Architects and Sid Chow ("LHR") were the architects for the Condominium. LHR applies to have this action dismissed or "permanently stayed" for an alleged failure, by the Strata and Royal & Sun/WBI, to disclose an agreement made between them January 13, 2023, which LHR referred to as a settlement agreement, but which is titled 'Receivership Funds Agreement' (the "Agreement"). [3] LHR submits that the failure to promptly disclose the Agreement substantially altered the legal landscape of this action such that it is an abuse of process that can only be addressed by a dismissal or permanent stay of this action. [4] The Strata and Royal & Sun/WBI submit that the Agreement did not substantially change the legal landscape of this litigation, nor the adversarial nature of the claims faced by LHR. They say the Agreement left the claims by LHR against Royal & Sun and WBI the same, only changing whether those claims were being advanced by the Strata or by an insurer standing in its shoes, pursuant to a right of subrogation. [5] I find that the Agreement did little more than to re-state aspects of the legal landscape of this litigation that were already disclosed in the pleadings and the 2-5-10 Warranty, as well as being detailed in correspondence between the parties. Specifically, the Agreement re-stated that: a) The corporate developers had entered a receivership, as already disclosed in the Amended Notice of Civil Claim (the "Claim"). b) There exists a right of subrogation, already laid out in the 2-5-10 Warranty, meaning Royal & Sun and WBI were and are subrogated to the Strata's claims against all defendants and the Strata must cooperate with any subrogation claim. c) Royal & Sun and WBI are responsible for anything determined to be a warrantable repair, consistent with what was already laid out in the 2-5-10 Warranty. d) Such repairs would be at no cost to the Strata, but would be paid out of the receiver funds or Royal & Sun and WBI's funds. This essentially repeats Royal & Sun and WBI's obligations to the plaintiff under the 2-5-10 Warranty, but for the fact that some of those funds were being secured from the developer's receiver, by the time of the Agreement. e) The Agreement also expressly states that it does not modify the terms of any previous warranty, underscoring that the Agreement does not alter the commitments in the 2-5-10 Warranty that are central to parts of this litigation. [6] Given that Agreement's salient terms were already known to all parties through the pleadings and the 2-5-10 Warranty, and that the remaining terms either detailed or arose from the proposed discharge of the corporate developer's receivership, which was also known to these parties, I find the Agreement did not substantially alter the landscape of this action. For the reasons given here, I dismiss LHR's application for a stay or dismissal of the within action. Background [7] The Condominium was developed by 1011 Limited Partnership (the "Limited Partnership") by way of its general partner 1011 Management Inc. (the "Developer"). [8] As required by s. 22 of the Homeowner Protection Act, S.B.C. 1998, c. 31, the Developer acquired home warranty insurance from a warranty provider. The warranty certificate provides for the 2-5-10 Warranty (generally, 2 years of warranty for materials and labor, 5 years of warranty for building envelope and 10 years of warranty for structural defects), issued by Royal & Sun and its agent, WBI. The 2-5-10 Warranty contains a right of subrogation by Royal & Sun and WBI for the Strata's repair claims, and a term requiring the Strata to cooperate with any subrogation claim, as follows: 12. Where The Warranty Provider makes a payment or assumes liability for any payment or repair under this policy, The Warranty Provider is subrogated to all rights of recovery of the Strata Corporation and its members against any person or persons who may have caused or contributed to the requirement for the repair under this policy, and The Warranty Provider may bring an action, at its expense, in the name of one or more Owners or of the Strata Corporation or of The Warranty Provider, to enforce such rights. 13. Where The Warranty Provider brings an action to enforce subrogated rights, the Strata Corporation and each owner must fully support and assist The Warranty Provider in the pursuit of those rights. [9] The Claim alleges, among other things, that: a) the various defendants involved in design and construction were liable in negligence because the condominium had a variety of defects, including in the parkade, exterior, windows, doors, balconies, walls and roof, and that these defects and related damage pose a real and substantial danger to owners, occupants and visitors; b) Royal & Sun and WBI were liable for breach of the 2-5-10 Warranty; c) the Strata and owners had an interest in the Condominium with a value equal to or greater than the coverage limits under the 2-5-10 Warranty; d) the Developer was negligent in several respects, including failing to ensure that any deficiencies were corrected prior to occupancy and to ensure its work complied with standards of good workmanship; and e) LHR was negligent for alleged failure to take reasonable care in designing the Condominium in compliance with applicable codes, bylaws and design standards, and failing to conduct field reviews and inspections during construction to ensure that the work complied with applicable codes, regulations, bylaws and was free of defects. [10] On September 23, 2015, the Developer was placed into receivership. Glover-Drennan Inc. (the "Receiver") was retained as the receiver manager of the assets, undertakings and properties of the Developer and, thereafter, the Receiver was named as the developer in subsequent disclosure statements. [11] When the Strata submitted warranty claims, they were sent to the attention of Royal & Sun and Glover-Drennan. From 2016 onwards, the Receiver coordinated repairs of the Condominium. [12] There are three different legal proceedings that bear on the situation: a) This action (S-1813820) is the Strata's claim for loss and damage arising from defects in the design and construction of the Condominium, brought against various parties involved in design and construction, and the separate claim for breach of the 2-5-10 Warranty brought against Royal & Sun and WBI (the "Condominium Action"). b) A parallel action (S-195786) brought by the Strata against Morrison Hershfield Limited and a John Doe consulting engineer, framed in negligence, alleging damage from defects in the building envelope (the "Building Envelope Action"). Many of the alleged defects overlap the defects noted in this action. c) The receivership proceeding (S-157557) in which the Receiver was appointed for the Developer by a court order made September 23, 2015 (the "Receivership Proceeding"). [13] On July 14, 2020, Royal & Sun and WBI filed its response to civil claim in the Condominium Action. The response contains these express pleadings: 7. To the extent that any of the Defects are valid so as to attract coverage under either of the 2-5-10 Warranty, which is specifically denied, they have been remediated by WBI or by Bynett, Bynett Construction, MWP, Bynett Holdings (collectively, the "Builder") and/or 1011 LP, 1011 Inc. (the "Developer"), at WBI's request, or they are still under good-faith investigation by WBI, and WBI is not in default of the terms of the 2-5-10 Warranty in connection with such claims or Defects. 15. On September 23, 2015, an order of the Supreme Court of British Columbia appointed the defendant Glover-Drennan Inc. ("Glover-Drennan") as the receiver of all assets, undertakings and properties of 1011 Limited Partnership, which included the Condominium. 16. Glover-Drennan has since, on behalf of itself and/or the Builder, assumed responsibility for carrying out repairs to warrantable defects to the Condominium by advancing funds to effect various repairs. 17. To the extent Glover-Drennan holds funds in its position as receiver, those funds are held for the benefit of WBI and/or the Condominium for effecting warrantable repairs to same. 18. Pursuant to the terms of the 2-5-10 Warranty, WBI is subrogated to all rights of recovery of the Plaintiff against any person or persons who may have caused or contributed to their claim for payment or repair under the 2-5-10 Warranty. [14] On October 6, 2021, Morrison Hershfield, the defendant in the Building Envelope Action, filed a third party claim joining all the defendants in this action as third parties to the Building Envelope Action. [15] On October 14, 2021, Royal & Sun and WBI filed its own third party claim in the Condominium Action, seeking contribution and indemnity from the other defendants, and from the defendants in the Building Envelope Action. The third party claim is both a contractual indemnity claim (against the developer and the builder) and a subrogated claim under the 2-5-10 policy as against all the defendants. [16] In February 2022, Royal & Sun and WBI filed their response in the Receivership Proceeding, opposing the Receiver's discharge application. The filed response identified the Developer was party to an indemnity agreement in favour of Royal & Sun and WBI which required the Developer to put the Royal & Sun and WBI in funds to meet its obligations under any warranty policy. Royal & Sun and WBI referenced estimates for further remediation work totaling approximately $250,000, of which $164,460 concerned the parkade concrete slab which had been identified as a significant defect at the Condominium. Royal & Sun and WBI also sought recovery for incurred investigation expenses, legal fees, and $100,000 as a contingency for a total of $610,779. [17] WBI and Royal & Sun advanced the following legal position: 5. Pursuant to the terms of the warranty and provisions of the Act, WBI is obligated to evaluate and effect warrantable defects. WBI has completed this evaluation, and as such, according to the Indemnity Agreement, and by extension, the Builders Agreement, 1011 Management is required to effect repairs and indemnify WBI. [Emphasis added.] [18] The Strata filed a response supporting Royal & Sun and WBI's position on holding back $610,779.46, on the basis that the Receiver had stepped into the role of "builder" pursuant to the indemnity agreement with WBI and Royal & Sun. [19] The Agreement was drafted by October 21, 2022, at which point it was approved by the Strata's owners. On November 18, 2022, the Strata's counsel sent an email to all of the defendants' counsel in the Condominium Action to advise that Royal & Sun and WBI intended to complete repairs at the Condominium " under their 2-5-10 warranty, and which have been included in the Strata's lawsuit." The email listed the specific repairs to be undertaken by Royal & Sun and WBI, which mirrored Schedule A to the Agreement. For example, with respect to the parkade concrete slab dusting issue, the email stated: Parkade concrete slab dusting (2 year report) - Repair following the 9 steps outlined in the August 19, 2023 McGrath Report. [20] The email concluded: We would like to invite all defendants and/or their experts to conduct a site visit prior to the repairs being conducted. We would like these site visits to occur prior to November 30, 2022 so that WBI can proceed with the repairs as soon as possible. [Emphasis added.] [21] One defendant counsel responded, and copied all other counsel in the Condominium Action, inquiring as follows: my client will want to know whether & if so which of repairs your client or WBI intends to pursue our client for, and the estimated cost, before making an informed decision on site attendance and experts. [Emphasis added.] [22] Strata counsel responded: the Strata cannot speak for WBI on whether they intend to pursue the cost of the repairs from your client. Our client has a claim for any costs incurred by them to date with respect to the repaired items, and to the extent the repairs are not successful, would also have a claim for any further incurred costs. [23] As noted, the Agreement is dated for reference January 13, 2023. The Receiver was discharged pursuant to the Order of the Honourable Justice Jackson pronounced March 10, 2023 (the "Jackson Order"), which directed the distribution of $350,000 to Royal & Sun and WBI's solicitors in trust, with the balance to be paid out to the investors (plaintiffs in the Receivership Proceeding). [24] The recitals to the Agreement include: C. The Strata has made a number of warranty reports in respect of defects in the Condominium's common property. The Warranty Provider has deemed a number of the Strata's reported defects as warrantable defects. D. The Warranty Provider and the Strata have agreed upon the repair work and methodology for a number of warrantable defects in the Condominium. [25] Section 2 of the Agreement provides: In consideration of the Strata executing the Consent Order with respect to the Receivership Application, the Warranty Provider agrees to arrange and be responsible for repairs to the Condominium, particulars of which are attached to this Agreement as Schedule "A" (the "Remedial Work"). The Remedial Work will be completed in a reasonable manner in accordance with the building code and industry standards. [26] Schedule A to the Agreement sets out the work that Royal & Sun and WBI will complete, identifying each repair item. [27] The Agreement does not address all reported defects. Defects that remain to be addressed include window defects, corrosion of exterior door handles, and poorly finished brick mortar. [28] While the Agreement provides for assignment of the Strata's rights arising from the remedial work undertaken pursuant to the Agreement, and provides that the Strata will "work cooperatively with the Warranty Provider in its exercise and pursuit of its subrogated and assigned rights", this merely confirms Royal & Sun and WBI's pre-existing subrogation rights under the 2-5-10 Warranty, which were already being advanced by way of their third party claim. The January 24, 2023 Receivership Funds Agreement [29] Because LHR argues that the Agreement substantially altered the litigation landscape, it is necessary to review its salient terms. [30] The Agreement is between the Strata and the warranty providers, Royal & Sun and WBI. [31] The Preamble of the Agreement contains the following relevant paragraphs: The Strata has made a number of warranty reports in respect of defects in this Condominium's common property. The Warranty Provider has deemed a number of the Strata's reported defects as warrantable defects. On May 17, 2021, Glover-Drennan Inc. filed an application (the "Receivership Application") to discharge his receivership in respect of 1011 Limited Partnership and to seek instructions from the Court on the remaining $933,108.40 held by the Receiver (the "Receiver Funds"). In response, the Strata and the Warranty Provider sought a portion of the Receiver Funds to be set aside to address warrantable defects in the Condominium. The Investors and the Warranty Provider have reached a tentative agreement with respect to the distribution of a portion of the Receiver Funds, whereby $350,000 of the Receiver Funds will be paid to legal counsel for the Warranty Provider in trust. The Strata and the Warranty Providers (the "Parties") wish to enter into this agreement in order to facilitate the settlement between the Warranty Provider and the Investors and to set out the terms by which the Strata agrees to consent to the discharge of the Receivership. [32] The relevant terms of the Agreement are as follows: 1. The Strata will file a Consent Order with respect to the Receivership Application consenting to the following orders: a) The Strata approves the Receiver's Final Statement of Receipts and Disbursements, together with all of the Receiver's actions to date in respect of the administration of the Receivership; b) The Strata approves the accounts of the Receiver for the period September 23, 2015 to discharge in the Limited Partnership; c) The Strata approves all distributions of the funds held under the control of the Receiver to satisfy the Receiver's and its legal counsel's outstanding accounts; d) $350,000 of the Receiver's Funds be paid to Whitelaw Twining in trust; e) The remainder of the Receiver Funds will be distributed to the Investors; and f) Once the Receiver Funds are distributed, the Strata approves the discharge of the Receivership of 1011 Limited Partnership. 2. In consideration of the Strata executing a Consent Order with respect to the Receivership Application, the Warranty Provider agrees to arrange and be responsible for repairs to the Condominium, particulars of which are attached to this Agreement as Schedule "A" (the "Remedial Work"). The Remedial Work will be completed in a reasonable manner in accordance with the building code and industry standards. 3. The Warranty Provider will undertake the Remedial Work at no charge to the Strata, and will utilize the Receiver funds and/or its own funds to undertake the Remedial Work. 17. Upon completion of the Remedial Work, such rights of subrogation in respect of the Remedial Work will flow to the Warranty Provider, and the Strata (including by a 3/4 vote of its members) assigns all of its rights arising from the Remedy Work to the Warranty Provider, and will work cooperatively with the Warranty Provider in its exercise and pursuit of its subrogated and assigned rights. 19. (g) This Agreement does not replace or modify the terms of any previous agreement or warranty between the parties. [33] In summary, the Agreement provides terms by which the Strata agrees to consent to a discharge of the Receivership of the Limited Partnership by way of its general partner, the Developer. Both the Limited Partnership and the Developer are defendants in the Condominium Action. Issue [34] The main issue on this application is whether the Receivership Funds Agreement should have been immediately disclosed to LHR and whether the failure to do so constitutes an abuse of process that can only be remedied by a stay or dismissal of the Condominium Action. Law [35] A party is required to "disclose immediately any agreement which affects the party's position in a way that is different than that revealed by the pleadings": Bilfinger Berger (Canada) Inc. v. Greater Vancouver Water District, 2014 BCSC 1560 at para. 160. [36] The test for immediate disclosure of a settlement agreement is whether it " changes entirely the landscape of the litigation in a way that significantly alters the dynamics of the litigation": Kingdom Construction Ltd. v. Perma Pipe Inc., 2024 ONCA 593 at para. 1, aff'g 2023 ONSC 4776 [Kingdom ONCA]. Discussion [37] The analysis involves considering whether the terms of the subject agreement make it clear that the settling parties have switched sides and must cooperate with the plaintiff. This question needs to be parsed carefully where there is a right of subrogation in the 2-5-10 Warranty from which the breach of warranty claims arise. [38] The Agreement is made between the Strata and Royal & Sun and WBI. It does not settle all issues in the Condominium Action between them. Rather, the Agreement principally resolves a dispute in the Receivership Proceeding, concerning the distribution of the Limited Partnership's remaining funds and the Receiver's application for discharge. The Receivership Proceeding is a separate action to which the applicant LHR is not a party. [39] To secure the Strata's agreement to the terms of the discharge order by which Royal & Sun and WBI obtained access to $350,000 of the Limited Partnership's remaining funds, the Strata and Royal & Sun and WBI agreed on a protocol for how those funds would be used to some of the Condominium repairs. [40] The Agreement does not provide for payment of $350,000 from the Receiver to Royal & Sun and WBI, nor does it waive any claims by the Strata. It contains the Strata's commitment to consent to the Receiver's discharge pursuant to a consent order implementing a different agreement between Royal & Sun and WBI and the investors. The Agreement also provides that Royal & Sun and WBI will undertake certain repairs "at no charge" to the Strata but leaves the question of how to pay for them with Royal & Sun and WBI, whether from its own funds or the Receiver funds. [41] When one of the defence counsel inquired about the intentions of the Strata and Royal & Sun and WBI after the repairs were completed, the response copied to all counsel in the Condominium Action was that the Strata " has a claim for any costs incurred by them to date with respect to the repaired items, and to the extent the repairs are not successful, would also have a claim for any further incurred repair costs." [42] In reviewing the Agreement in detail, I find that the salient parts of it were already disclosed in the parties' pleadings or in correspondence between them, consistent with litigation where the alleged defects and repairs are the subject of ongoing investigation and remediation. [43] When Royal & Sun and WBI agreed to undertake some of the repairs to the Condominium, several months prior to the Receivership Funds Agreement being executed, Royal & Sun and WBI gave detailed written notice to all defendants and third parties. [44] The fact of the receivership and the subrogation and cooperation terms were already disclosed in the pleadings. The receivership is detailed in the response to civil claim filed July 14, 2020. The response includes a provision that to the extent the receivership holds funds in its position as receiver, those funds "are held for the benefit of WBI and / or the Condominium for effecting warrantable repairs to same." This is closely tracked in the Agreement where it confirms that Royal & Sun and WBI will utilize the Receiver funds and/or its own funds to undertake the agreed remedial work. [45] The Agreement indicates that Royal & Sun and WBI had obtained access to $350,000 of the remaining funds held by the Receiver, and the Strata and Royal & Sun/WBI agreed on a protocol about how those funds would be used to effect certain repairs. The use of those funds does not affect LHR or the other defendants, since to the extent that Royal & Sun and WBI use the Receiver's funds to effect repairs, Royal & Sun and WBI have no claim against the other defendants and there is no subrogation right where the insurer suffers no loss. The fact of those funds being available was contemplated in the response to civil claim. [46] The Agreement provides for assignment of the Strata's rights arising from the remedial work undertaken pursuant to it, and provides that the Strata will "work cooperatively with the Warranty Provider in its exercise and pursuit of its subrogated and assigned rights". While this term may appear to shift an adversarial relationship between the Strata and Royal & Sun and WBI in this litigation to a cooperative one, it merely restates the subrogation and cooperation terms in the 2-5-10 Warranty, which are also expressly explained in the pleadings, specifically Royal & Sun and WBI's response to civil claim and third party claim. [47] In addition, the Agreement does not address all reported defects. Window defects, corrosion of exterior door handles and poorly finished brick mortar, at least, remain disputed. The result is that the Strata and Royal & Sun and WBI remain classically adverse in this litigation with respect to some issues. [48] The Strata's claim against WBI and Royal & Sun and its claim against the other defendants involved in the actual construction are distinct claims, giving rise to several liability only. The claim against WBI and Royal & Sun is for breach of the 2-5-10 Warranty. The claims against the other defendants, including LHR, are grounded in negligence. [49] Kingdom Construction Ltd. v. Perma Pipe Inc., 2023 ONSC 4776 [Kingdom ONSC] is instructive on this point. Kingdom was the general contractor on an underground water piping system. The defendant insurer Catlin Canada Inc. issued a builder's risk and course of construction insurance policy to the York and Durham municipalities. [50] During construction, Kingdom was required to remediate the piping system at considerable cost. It commenced a claim, naming Catlin and York and Durham. It also named the consulting engineer ("CH2M") and companies involved in the design, supply and installation of the piping ("Perma" and "Delta"), engineers ("Bray" and "Witek"), the pipe manufacturer ("Victaulic"), and a material supplier ("Westlund"). [51] Kingdom reached a settlement agreement with Catlin and York and Durham, which had these features: a) Kingdom would assign to Catlin (insurer) its rights to pursue Kingdom's claims against the non-settling defendants (i.e. CH2M, Perma, Delta, Bray, Witek, Victaulic and Westlund). b) Catlin (as assignee of Kingdom's claims against the non-settling defendants) would enter into a Perringer (i.e. BC Ferries) agreement with York and Durham and discontinue against them. c) If Catlin recovered more from the non-settling defendants than it had paid to Kingdom to settle, it would pay the excess recovery to Kingdom. d) Kingdom would cooperate with Catlin by making all relevant documents and its people available to assist in the prosecution of the claims against the non-settling defendants. [52] The non-settling defendants brought an application seeking a permanent stay on the basis that the settlement agreement required immediate disclosure and immediate disclosure was not made. In Kingdom ONSC, Justice Broad dismissed the application, writing: 40 I find that Kingdom's claims against Catlin on the insurance policy and against York on the contract and York and Durham based on unjust enrichment are fundamentally distinct from its claims against the non-settling defendants all of which founded in negligence, and that this distinction weighs against the settlement being found to have changed entirely the landscape of the litigation in a way that significantly alters the dynamics of the litigation. 43 The determination of whether Catlin was obliged to provide coverage on the policy for Kingdom's loss was capable of being made by either a finding to that effect by the Court on the motion, or by settlement between Kingdome and Catlin. Regardless of whether Catlin was found by the Court to be required to provide coverage or it accepted such obligation in whole or in part by settlement, the non-settling defendants must necessarily have appreciated that Catlin would be entitled to subsequently advance a subrogated claim against them, either pursuant to the terms of the Policy, which had been disclosed to them in the summary judgment motion materials, or in equity. A subrogated claim by Catlin against them could therefore be "expected in the conduct of the litigation" as stated in the applicable test in Handley Estate. 46 The fact that, by virtue of the settlement, Kingdom, Catlin, York and Durham were no longer adverse to each other did not significantly alter the dynamics of the litigation. As indicated, the prior adversity between Kingdom and Catlin related solely to the coverage issue under the Policy, and the adversity between Kingdom and York was contractual in nature and between Kingdom and Durham quasi-contractual. None of these issues concerned the non-settling defendants, and any change in this respect had no impact on their legal positions. 48 The fact that Catlin is no longer a defendant but is now a plaintiff, is a function of the operation of subrogation. It does not significantly alter the dynamics of the litigation. The same point applies in relation to the fact that it is Catlin that is now seeking damages rather than Kingdom. [Emphasis in original.] [53] This decision was affirmed in Kingdom ONCA, in which Justice Zarnett stated for the Court: 42 As the motion judge noted, the appellants had little, if any, pre-settlement interest in the issue of whether Kingdom was entitled to payment by Catlin under the Policy. They did not participate in Kingdom's motion for summary judgment on that issue. Nor did the settlement of that issue have a significant effect on the claims that the appellants would face post-settlement. Kingdom's pre-settlement claims would be pursued post-settlement by Catlin but in the name of Kingdom under the doctrine of subrogation. There was no change in whose claims the appellants were facing. Nor did the settlement terms requiring Kingdom to assist Catlin in the pursuit of those claims change in any way the evidence that would be marshalled against the appellants in support of those claims, or their amount, compared to what the appellants were facing pre-settlement. [Emphasis added.] [54] Kingdom ONCA applies here for its treatment of the subrogation issue. Whether the claims are brought by the Strata directly, or by WBI and Royal & Sun pursuant to their right of subrogation, they are the same claims faced by the defendants. The tort claim by the Strata against LHR remains a claim in negligence for architectural work that fell below the required standard, which is a severable claim from the Strata's claims against Royal & Sun and WBI for breach of the 2-5-10 Warranty. [55] The Agreement does much less to change the landscape of this litigation than did the agreement at issue in Kingdom ONSC. Here, unlike in Kingdom ONSC, there is no term releasing any defendant from the Condominium Action. There was no agreement to compromise any claims against other parties. It remains to be seen whether the funds transferred by the Receiver to counsel for WBI and Royal & Sun pursuant to the Jackson Order will be sufficient to cover the repairs; to the extent that they are not, a subrogated claim is available and explained in the pleadings. Royal & Sun/WBI and the Strata remain adverse in interest because there are further defects that the Strata continues to pursue in the litigation which WBI and Royal & Sun have not agreed to fix. Conclusion and Orders [56] I find the Agreement did not substantially alter the landscape of the Condominium Action, nor the nature of the Strata's claim against LHR. Therefore, it was not necessary to immediately disclose the Agreement. [57] I dismiss LHR's application for a stay or dismissal of the within action, with costs to the Strata. "J. K. Gibson, J."