Executive Summary: Key Legal and Evidentiary Issues

• Interpretation of brokerage agreement provisions (ss. 9.5, 14.3 and 14.4) governing which party may communicate with policyholders after termination and for what purposes.
• Dispute over whether Commonwell’s direct notices to policyholders constituted a breach of contract and/or an impermissible restrictive covenant in light of insurance regulatory obligations.
• Alleged misuse of BrokerLink’s confidential customer and expiry information, engaging the tort of breach of confidence and the “ownership of expirations” clause.
• Application of the injunction test, including whether BrokerLink showed a serious issue versus a strong prima facie case for mandatory relief.
• Contested evidence of irreparable harm, particularly around alleged loss of customers, business opportunities, and reputational damage, and whether these are quantifiable in damages.
• Balance of convenience between a broker’s commercial interests and a mutual insurer’s duties to its policyholder-members, including regulatory and governance impacts of restricting communications.

Background and parties

BrokerLink Inc. operates as an insurance broker that markets and sells insurance products on behalf of multiple insurers. The Commonwell Mutual Insurance Group is an insurance company structured as a mutual, meaning its policyholders are also Members and owners, with corresponding governance and participation rights in the mutual. The two entities entered into a brokerage agreement effective January 1, 2014, under which BrokerLink would market and sell Commonwell’s insurance products to customers.
On September 3, 2025, BrokerLink gave notice that it was terminating the agreement effective January 1, 2026. It also advised Commonwell that it would cease issuing new policies for Commonwell as of September 10, 2025. After giving that notice, BrokerLink asserted that Commonwell improperly communicated with customers that BrokerLink regarded as its own, allegedly using confidential information and undermining BrokerLink’s relationships with those customers. BrokerLink therefore brought a motion seeking both prohibitory and mandatory interlocutory injunctions to restrict and reverse Commonwell’s communications.

Termination of the brokerage agreement and the notices sent

Following the termination notice, Commonwell sent two waves of communications to policyholders. The first, sent on October 20, 2025, went to approximately 700 policyholders whose Commonwell policies were nearing expiry. These letters thanked them for being Members, stated that BrokerLink had chosen to stop selling Commonwell products effective January 2026, and explained that BrokerLink would be moving their policies to another insurer at renewal. The letter expressly stated that the choice remained with the policyholder and encouraged them to consider remaining with Commonwell, with a QR code and link directing them to a page listing other Commonwell-affiliated brokers.
After a standstill agreement expired, Commonwell sent a second notice on November 28, 2025 to all affected policyholders, this time not tied to particular renewal dates. That notice again explained that BrokerLink had decided not to sell Commonwell products, that BrokerLink would seek to move coverage at renewal, and that policyholders could instead choose to remain with Commonwell. It described the mutual nature of Commonwell, the consequences of moving coverage (loss of Member status), and directed customers to a website listing local options for remaining insured with Commonwell.
BrokerLink viewed these communications as improper solicitation of “its” customers and as an attempt to divert business to other brokers, contrary to the terms and spirit of the brokerage agreement.

Key contractual provisions in dispute

Central to the dispute were three key contractual provisions: section 9.5, section 14.3 and section 14.4 of the brokerage agreement.
Section 9.5 sets out what happens upon termination. Under s. 9.5(i), if the broker undertakes within 30 days to replace policies with another insurer and assumes responsibility for advising each insured at least 45 days prior to expiry, it is the broker who is to inform policyholders. Under s. 9.5(ii) and (iii), if the broker does not give such an undertaking, or fails to comply, the insurer may notify policyholders of the termination and contact them regarding it. BrokerLink claimed it had given the required undertaking under s. 9.5(i), and therefore Commonwell was barred from communicating with policyholders about the termination or urging them to stay with Commonwell.
Section 14.3 deals with direct communication by Commonwell with insureds. It provides that the broker consents to the insurer communicating directly with insureds to adjust claims and provide annual statements, and further recognizes that the insurer “may…need to communicate directly…for other purposes”, provided it gives the broker 30 days’ advance notice of such other communication. Commonwell relied on this clause to argue that the agreement is permissive, not prohibitory, with respect to direct communication, and that the parties could and did contemplate direct contact outside of claims and annual statements.
Section 14.4, titled “Ownership of Expired Policy Documentation,” states that, subject to s. 14.3, the use and control of “expirations” and related records remains in the undisputed possession of the broker. It prohibits the insurer from using expiration records “in any marketing method” that would abridge the broker’s rights and from referring or communicating this expiration information to others. BrokerLink argued that sending renewal-linked notices to 700 customers necessarily involved using its proprietary expiration data in a marketing effort to retain those policyholders through other brokers, thus breaching s. 14.4.
The court found that both sides had arguable interpretations on the proper reach of these clauses. BrokerLink argued that the agreement effectively created a no-solicitation covenant preventing Commonwell from contacting customers to retain them after termination, while Commonwell argued that such a reading was inconsistent with the agreement’s language, the mutual’s obligations to Members, and the broader regulatory framework.

Regulatory context and competing interpretations

A significant overlay was the regulatory framework governing fair treatment of customers in insurance. Commonwell pointed to guidance from the Financial Services Regulatory Authority and the Canadian Council of Insurance Regulators, emphasizing that insurers and brokers must provide “accurate and clear information” before, during and after the sale so that customers can make informed decisions, and must disclose contractual changes during the policy term.
Commonwell argued that any contractual prohibition on direct communication with policyholders about termination, options to remain with the insurer, or the governance consequences of leaving a mutual would put it at odds with these regulatory expectations. It also highlighted that mutual policyholders are Members with governance rights, including electing directors and possibly participating in future surplus distributions; if customers were quietly moved to a new insurer without being fully informed, they could lose those rights unknowingly. In this light, Commonwell said the agreement could not reasonably be read as a full communication gag; if the parties intended such a restrictive covenant, they could have drafted express non-solicitation language, which they did not do.
BrokerLink responded that the contract was designed to preserve its client relationships and to keep the customers it had introduced to Commonwell as BrokerLink customers after termination. From its perspective, the customer belonged to the broker, and Commonwell’s broad communications went beyond any acceptable regulatory or informational purpose and crossed into active solicitation. It relied on its own termination notices to customers, which did not make clear that the customers had an option to stay with Commonwell, as evidence that the agreement envisioned the broker as the sole communicator on the termination.
Ultimately, at the interlocutory stage, the judge accepted that there was a serious issue to be tried on these competing contractual and regulatory interpretations, but not a strong prima facie case on BrokerLink’s reading, given the text of the provisions and the regulatory obligations.

Alleged breach of confidence and use of proprietary information

BrokerLink also advanced a claim in breach of confidence, relying heavily on section 14.4. It said the customers’ identities and the expiry data for their policies formed part of its confidential “expirations” and “BrokerLink Proprietary Information”; using that information to send targeted notices tied to renewal dates in order to retain customers with Commonwell and other brokers was an unauthorized use. This, BrokerLink argued, met the elements of breach of confidence: confidential information, communicated in circumstances importing an obligation of confidence, and used in an unauthorized way.
The court accepted that there was at least a substantial issue to be tried with respect to the October 20, 2025 notices sent to 700 customers linked to their policy renewals. Those communications appeared to be dependent on precise expiry information, which the parties had treated as belonging to the broker for marketing purposes. However, the later November 28, 2025 notice was not tied to expiry dates and was sent to all affected policyholders based on Commonwell’s own policy records. The judge considered that this later notice did not obviously rely on expiry data or customer lists in a way that breached s. 14.4, since the insurer naturally possessed the underlying policyholder information as the contracting party with those insureds.
Here again, the court concluded that the substantive merits would need to be resolved at trial, and that while a breach of confidence claim was arguable in relation to the renewal-linked notices, it did not rise to the level of a strong prima facie case justifying mandatory interlocutory relief.

The injunction test: serious issue, irreparable harm, and balance of convenience

The motion was decided under the familiar RJR-MacDonald framework for interlocutory injunctions. For the prohibitory injunction, BrokerLink needed to show a serious issue to be tried, irreparable harm, and a balance of convenience in its favour. For the mandatory components (such as requiring Commonwell to alter its website and send corrective communications), the parties accepted that a higher threshold of a strong prima facie case applied.
On the first branch, the court held that there was clearly a serious issue to be tried on both breach of contract and breach of confidence, given the disputed interpretation of ss. 9.5, 14.3, and 14.4, and the evidence about how the notices were sent. However, the judge was not persuaded that BrokerLink had established a strong prima facie case that the agreement prohibited Commonwell’s communications in the way alleged, particularly against the backdrop of the regulatory context and mutual structure.
The irreparable harm analysis proved decisive. BrokerLink argued that it faced non-quantifiable harm, including loss of business opportunities, damage to customer relationships, and reputational harm. The evidence, however, showed that BrokerLink had 12,600 Commonwell customers and that, as of the motion date, only five had terminated their relationships with BrokerLink, with no direct evidence that these departures were caused by Commonwell’s notices. The court noted that attrition is normal in the industry and found that any loss of commissions or cross-selling opportunities could be tracked and quantified over time.
Reputational harm was pleaded but remained speculative. BrokerLink provided no customer letters or industry feedback demonstrating diminished trust or goodwill, and there was no disparagement of BrokerLink in Commonwell’s notices. The court emphasized that customers in this segment are accustomed to receiving communications from both broker and insurer; they also would not know the internal terms of the brokerage agreement, so it was not evident how Commonwell’s factual explanation—namely that BrokerLink had chosen to stop selling its products—would damage BrokerLink’s reputation in some unquantifiable way.
The judge also weighed the history of discussions between the parties. Commonwell had told BrokerLink in September that it intended to communicate with policyholders, and BrokerLink’s representative had not objected on the basis of prohibition, instead requesting that Commonwell delay its notices to avoid overlap and “confusion.” The court found that this conduct undercut the claim of looming, irreparable harm.
On the balance of convenience, the court considered not only the commercial interests of the parties but also the interests of policyholder-Members. Granting the injunction would effectively prevent Commonwell from directly communicating with Members about termination, their ongoing options, and the consequences of moving coverage, potentially forcing it to rely on incomplete or confusing broker communications. This raised a real risk of non-compliance with regulatory duties of fair treatment and disclosure. There was also concern that Members could unwittingly lose ownership and governance rights in the mutual if moved to another insurer without an adequately informed choice. By contrast, if no injunction issued, BrokerLink could continue to communicate with customers and later quantify and claim any lost commissions or related damages. The court therefore held that the balance of convenience weighed against granting the injunction.

Mandatory relief, undertaking as to damages, and procedural points

BrokerLink also sought mandatory orders requiring Commonwell to change web content linked in the notices, replace certain online messaging with directions to contact BrokerLink, and instruct other brokers to refer any BrokerLink customers holding Commonwell policies back to BrokerLink. Given the stringent standard for mandatory injunctions, the court’s finding that there was no strong prima facie case on the merits effectively disposed of these requests.
There was a further procedural concern about BrokerLink’s undertaking as to damages. The undertaking was only provided the day before the motion argument, by way of an affidavit filed after cross-examinations had been completed and without seeking leave to file late evidence. Commonwell argued that this failure to comply with the usual requirement for an undertaking as to damages was fatal to the motion. The judge ultimately found it unnecessary to resolve this issue conclusively, since BrokerLink had already failed on irreparable harm and the balance of convenience.
In the result, the court dismissed the motion in its entirety. Commonwell, as the successful party, sought its litigation costs. BrokerLink itself had advanced substantial and partial indemnity costs figures in excess of what Commonwell claimed, undermining any argument that the amount sought by Commonwell was unreasonable. The judge assessed Commonwell’s costs request as fair and reasonable and awarded it partial indemnity costs of $107,044, payable by BrokerLink. Thus, Commonwell emerged as the successful party at this interlocutory stage, with the only monetary award being the $107,044 in costs ordered in its favour; no damages were awarded at this time, as the underlying contractual and confidentiality claims remain to be determined at a future hearing on the merits.