Lawyers for Aviva Insurance are arguing its policies do not cover sexual abuse by priests within the Catholic Diocese of Bathurst.

The diocese has filed a civil lawsuit against the insurer to help it recoup more than $7-million it paid out to victims of sexual abuse.

"Clearly there is no coverage," said Aviva's lawyer Charles LeBlond in his opening statement Monday in a Moncton courtroom. "There is no coverage for criminal activity."

Aviva Insurance defense lawyer Charles LeBlond says the issue is what the diocese knew and when. (Ian Bonnell/CBC) In his statement, LeBlond also said "there is a fair bit of documented evidence that the diocese and the bishops of the day were aware."

Father Levi Noel and Father Charles Picot, both former priests in the diocese, have been criminally charged with numerous counts of sexual abuse, some dating back to the 1950s.

The Bathurst diocese had an insurance policy with Aviva from 1957 to 1983.

Last week, the court heard from former Supreme Court justice Michel Bastarache. He explained he interviewed 90 sexual assault victims as part of a compensation process.

The Bathurst diocese paid out over $7 milllion in settlement claims to victims of sexual abuse by priests. (YouTube) Those victims named a total of 26 priests, including Noel and Picot, as abusers in the diocese.

LeBlond told the court there is documentation that Noel had been shipped from parish to parish, including one letter, "where the bishop sent him north where nobody knew his past," said LeBlond. "A bishop accommodating a priest, knowing he would reoffend."

LeBlond went on to say that a reasonable bishop would have at least removed the priest from contact with children.

Chris Blom, one of the lawyers representing the diocese, acknowledges the church had knowledge some priests were molesting children.

But, Blom argued that in the 1950s and several decades that followed, the diocese did not know abuse was an insurance risk. And he said the insurer never asked the diocese whether there was abuse within the church.