0782484 B.C. Ltd. v. South Island Aggregates Ltd., 2021 BCSC 1509

IN THE SUPREME COURT OF BRITISH COLUMBIA Citation: 0782484 B.C. Ltd. v. E-Pro Enterprises Inc., 2021 BCSC 1509 Date: 20210803 Docket: S113857 Registry: Victoria Between: 0782484 B.C. Ltd. and South Island Aggregates Ltd. Plaintiffs And: E-Pro Enterprises Inc., Kevin Adrian Bromley carrying on business as E-Pro Enterprises, Quantum Murray LP, 0848052 B.C. Ltd., H. Volk Transport Limited, and 0880056 B.C. Ltd. Defendants And: E-Pro Enterprises inc., Kevin Adrian Bromley carrying on business as E-Pro Enterprises, and 0848052 B.C. Ltd. Third Parties Before: The Honourable Madam Justice J. A.

Power Reasons for Judgment Counsel for the Plaintiffs: J. M. Hutchison, Q.C. Counsel for Quantum Murray LP: M. L. Burris and J. D. Wong Counsel for 0848052 B.C. Ltd.: R. J. Lesperance and J. M. Chatten No other appearances Place and Dates of Trial/Hearing: Victoria, B.C. September 14 - 16, 2020 October 28 - 30, 2020 Written Submissions Received: March 22, 26 and 30, 2021 Place and Date of Judgment: Victoria, B.C. August 3, 2021 Table of Contents Introduction .. 4 Factual Background .. 5 Procedural History .. 7 Positions of the Parties .. 8 Issues .. 9 Legal Principles .. 10 Analysis .. 13 1.

Whether there is a question or real issue between the parties that relates to the relief, remedy or subject matter of the proceeding . 13

a) Addition of Great Pacific and Accredit as defendants . 13

b) Addition of the proposed personal defendants . 19

2. Whether it would be just and convenient to add the Proposed Defendants . 21

a) Delay . 22

b) Prejudice . 26

c) Connection between the existing action and the new parties . 29

d) Existence of a limitation defence . 29 3. Conclusion regarding the Plaintiffs’ joinder application .. 36 4. Quantum’s third party application .. 36

a) Prejudice . 40

b) Expiry of a limitation period . 40

c) Merits of the claim .. 42

d) Delay . 42

e) Timeliness of the application .. 43 5. Conclusion regarding Quantum’s third party application .. 43 Conclusion .. 43 Introduction [ 1 ] The plaintiffs/applicants, 0782484 B.C. Ltd. and South Island Aggregates Ltd. (collectively, the “Plaintiffs”), seek an order pursuant to Rule 6-2(7) of the Supreme Court Civil Rules, B.C. Reg. 168/2009 that Great Pacific Mortgage and Investments Ltd. (“Great Pacific”), Accredit Mortgage Ltd. (“Accredit”), Rory Howard Campbell, Jeffrey Alexander Moses and Walter Rodney Neufeld be added as defendants to this action (collectively, the “Proposed Defendants”).

The Plaintiffs also seek to amend their notice of civil claim pursuant to Rule 6-1 in the form attached to their notice of application, filed September 15, 2017. [ 2 ] In a separate application, the defendant, Quantum Murray LP (“Quantum”), seeks to amend its third party notice to add Great Pacific and Accredit as third parties for the purposes of contribution and indemnity pursuant to Rule 3-5. [ 3 ] The underlying action concerns claims for negligence, breach of contract, and costs of remediation under the Environmental Management Act , S.B.C. 2003, c. 53 [ EMA ] in respect of the Plaintiffs’ property located on Stebbings Road in Shawnigan Lake, British Columbia. [ 4 ] The Plaintiffs commenced the action on September 19, 2011, naming E-Pro Enterprises Inc. (“E-Pro”), Kevin Bromley, 0848052 B.C.

Ltd. (“0848”), H. Volk Transport Ltd., Quantum and 0880056 B.C. Ltd. as defendants (collectively, the “Defendants”). The Plaintiffs now seek to add the Proposed Defendants to the action. [ 5 ] 0848 and the Proposed Defendants are the respondents in this application, who I will sometimes collectively refer to as the “Respondents.” [ 6 ] From the outset, I wish to echo Kent J.’s remarks in 1112082 B.C. Ltd. v. Lightray Corp. (Canada) , 2019 BCSC 1041 , at para. 30 , where he characterized the respondents’ approach to the application in that case as “essentially seeking a

summary determination on the merits as the basis for resisting the proposed addition of the parties.” I am of the view that the Respondents in this application have taken a similar approach. [ 7 ] For the reasons that follow, I have concluded that the addition of Great Pacific and Accredit is necessary to provide for the proper determination of this action. It would be just and convenient to permit the addition of those parties. I have concluded that the Plaintiffs could not have reasonably determined the potential involvement of Great Pacific and Accredit prior to the document disclosure that occurred in 2016.

I am granting the Plaintiffs and Quantum leave to amend their notice of civil claim and third party notice, respectively. Factual Background [ 8 ] In 0782484 B.C. Ltd. v.

E-Pro Enterprises Inc. , 2017 BCSC 2245 , Voith J., as he then was, outlined the relevant background facts pertaining to the action in a manner that I adopt for the purposes of this application: 4 The claim by South Island Aggregates Ltd. ("SIA") against the defendants is based on allegations that contaminated soil was moved by the defendants from a property in View Royal to SIA's property on Stebbings Road in Shawnigan Lake, British Columbia (the "SIA Property").

5 Key to this case are the alleged actions against the defendant Kevin Bromley. Mr. Bromley was, at the time, a professional engineer. He is also the principal of the defendant, E-Pro Enterprises Ltd. ("E-Pro"). 6 0848 retained E-Pro to remediate a property that 0848 owned at 140 Hallowell Road, View Royal, British Columbia (the "Hallowell Property"). E-Pro was, at the time, the owner of a property at 1012 Yates Street, Victoria, British Columbia ("E-Pro Property"). 7 Based on the allegations made in the Notice of Civil Claim and the Third Party Notice of the defendant Quantum Murray LP ("Quantum"), Mr.

Bromley took contaminated soil from the E-Pro Property and moved it to the Hallowell Property. 8 It is also alleged that Mr. Bromley took contaminated soil from the properties of two other E-Pro clients and deposited them on the Hallowell Property. 9 After allegedly moving contaminated soil from these various properties to the Hallowell Property, it is further alleged that on or about October 29, 2010 and until on or about November 5, 2010, Mr. Bromley arranged for Quantum, H.

Volk Transport Limited ("Volk") and Don Mann Excavating Ltd. to transport that soil from the Hallowell Property to the SIA Property. 10 SIA's position is that while it agreed to receive soil from Quantum and E-Pro, it was not aware that the soil was allegedly contaminated. 11 On September 19, 2011, SIA commenced this action. In its Notice of Civil Claim, SIA advances claims against all defendants under the Environmental Management Act , S.B.C. 2003, c. 53 .

Under that legislation, a party who incurs costs to remediate a contaminated site may recover its reasonably incurred costs from a class of persons called "responsible persons" (see

section 45). 12 SIA further claims against Quantum, Mr. Bromley, E-Pro and Volk in negligence and against Quantum, Mr. Bromley and E-Pro for breach of contract. 13 I have said that this action arises out of activities that took place in 2010 and that this action was commenced in 2011. The action was initially scheduled to go to trial in September, 2016. 0848 made further document disclosure just prior to the trial with the result that the trial was adjourned. On September 15, 2017 the Plaintiffs brought an application to add the Proposed Defendants to this action (the "Joinder Application").

On October 2, 2017 Master Dick adjourned the Joinder Application so that this application could be heard first. [ 9 ] On September 9, 2016, the Friday before the trial was set to commence on September 12, the defendant 0848 disclosed various documents which, according to the Plaintiffs and Quantum, revealed for the first time the potential involvement of the Proposed Defendants in respect of the Plaintiffs’ claims in the action. Based on that disclosure, the Plaintiffs conducted an examination for discovery of the defendant Mr.

Bromley on December 12, 2016, which the Plaintiffs and Quantum say further revealed the potential liability of the Proposed Defendants in relation to the handling of the contaminated soil. [ 10 ] The proceeding before Voith J. concerned an application for disclosure brought by the Respondents in respect of portions of the files of the Plaintiffs’ solicitors.

Voith J. found that the Plaintiffs voluntarily put their understanding of their legal position in issue by asserting that, as a result of 0848’s document disclosure and the subsequent legal advice they received, they became aware of potential causes of action against the Proposed Defendants (at para. 44). [ 11 ] The Plaintiffs were ordered to disclose files relating to the initial identification and selection of the Defendants, as well as to the examinations for discovery of the defendants Mr. Bromley and E-Pro.

They were also ordered to produce the file of the solicitor who represented them in other proceedings related to the alleged soil contamination and to produce various documents in their possession pertaining to their relationship with Active Earth Engineering Ltd., which had prepared an expert report on behalf of the Plaintiffs in the action. [ 12 ] On the basis of new information allegedly revealed for the first time in the September 9, 2016 document disclosure of 0848 and the examination for discovery of Mr.

Bromley on December 12, 2016, the Plaintiffs seek to add the Proposed Defendants as defendants and Quantum seeks to add Great Pacific and Accredit as third parties in the action. Procedural History [ 13 ] By way of brief procedural background, the Plaintiffs filed its joinder application on September 15, 2017 and Quantum filed its response on September 25, 2017. That application was adjourned by Master Dick on October 2, 2017, prior to the Respondents’ disclosure application before Voith J.

The Plaintiffs’ joinder application is now before me in this proceeding. 0848 filed its response to the joinder application on December 3, 2019. [ 14 ] Quantum filed its application to amend its third party notice on September 25, 2017. The Plaintiffs filed their response to Quantum’s application on September 26, 2017 and 0848 filed its response on December 3, 2019. [ 15 ] The parties made oral submissions in respect of this application on September 14 to 16 and October 28 to 30, 2020.

Between March 19 and March 30, 2021, Quantum and the Respondents provided further written submissions regarding a recent case from our Court of Appeal, Sohal v. Lezama , 2021 BCCA 40 [ Sohal ], which concerned the

interpretation of various provisions of the Limitation Act , S.B.C. 2012, c. 13 . On March 23, 2021, the Plaintiffs enclosed another recent decision from our Court of Appeal, Madadi v. Nichols , 2021 BCCA 10 [ Madadi CA ], in support of their application but did not make further submissions. Positions of the Parties

[ 16 ] The Plaintiffs take the position that, as a result of 0848’s disclosure of documents on September 9, 2016, they became aware for the first time of the involvement of the Proposed Defendants in directing, handling, transporting, and delivering the contaminated soil to its property. [ 17 ] The Plaintiffs allege that, among other things: 1. 0848 is an agent of Great Pacific, which is an agent of Accredit; 2. the Proposed Defendants are liable as “responsible persons” under the EMA ; and 3. the registration of a mortgage in favour of Accredit over title to the property located at 140 Hallowell Road, View Royal, British Columbia (the “Hallowell Property”), legally registered to 0848, was a fraudulent conveyance contrary to the Fraudulent Conveyance Act , R.S.B.C. 1996, c. 163 ; or alternatively, was a fraudulent preference contrary to the Fraudulent Preference Act , R.S.B.C. 1996, c. 164 . [ 18 ] They also allege that Mr.

Campbell, Mr. Moses and Mr. Neufeld were directors, agents, or officers of 0848, and in that capacity, they participated in the matters which form the subject matter of the action. [ 19 ] Quantum seeks contribution and indemnity from Great Pacific and Accredit.

Quantum submits that the apportionment of remediation costs in respect of the Plaintiffs’ property and the degree of liability between it, the other defendants, and the Proposed Defendants, will be relevant issues in the action. [ 20 ] Similar to the Plaintiffs, Quantum also alleges that it discovered the involvement of Great Pacific and Accredit after 0848’s document disclosure in September 2016. Both Quantum and the Plaintiffs allege to have learned further information of the involvement of Great Pacific and Accredit in respect of the contaminated soil during an examination for discovery of Mr.

Bromley on December 12, 2016, which in turn prompted another document disclosure by 0848. [ 21 ] The Respondents take the position that the Plaintiffs’ amended notice of civil claim and Quantum’s amended third party notice do not plead the material facts necessary to disclose a cause of action against them. They argue that it would not be just and convenient to add the Proposed Defendants to the action because the limitation period in respect of the claims made by the Plaintiffs and Quantum has expired.

They say that the Plaintiffs failed to exercise due diligence in discovering the Proposed Defendants and have delayed without satisfactory explanation. They further argue that adding the Proposed Defendants would cause additional delay in the proceeding of this matter to trial, and that the Proposed Defendants would be prejudiced if they were added at this late stage of the proceedings.

Issues [ 22 ] There are two applications that were heard at the same time: the first concerns the Plaintiffs’ joinder application pursuant to Rule 6-2(7), the second concerns Quantum’s third party application pursuant to Rule 3-5(4). There is considerable overlap between the two applications and the applications involve similar considerations. [ 23 ] I will address the Plaintiffs’ application first. Quantum supports the Plaintiffs’ application with respect to the addition of Great Pacific and Accredit as defendants, and take no position on the addition of the proposed personal defendants Mr. Campbell, Mr.

Moses and Mr. Neufeld. [ 24 ] The issues arising on the Plaintiffs’ application are: 1. whether there is a question or real issue between the parties that relates to the relief, remedy or subject matter of the proceeding; and 2. whether it would be just and convenient to add the Proposed Defendants. [ 25 ] I turn now to address the applicable legal principles governing the addition of parties under Rule 6-2(7). Legal Principles [ 26 ] In support of their application, the Plaintiffs rely on Rule 6-2(7), which reads as follows: Adding, removing or substituting parties by order

(7) At any stage of a proceeding, the court, on application by any person, may, subject to subrules (9) and (10), (

a) order that a person cease to be party if that person is not, or has ceased to be, a proper or necessary party, (

b) order that a person be added or substituted as a party if (

i) that person ought to have been joined as a party, or (ii) that person's participation in the proceeding is necessary to ensure that all matters in the proceeding may be effectually adjudicated on, and (

c) order that a person be added as a party if there may exist, between the person and any party to the proceeding, a question or issue relating to or connected with

(

i) any relief claimed in the proceeding, or (ii) the subject matter of the proceeding that, in the opinion of the court, it would be just and convenient to determine as between the person and that party. [27] In Madadi CA, at paras. 21-26, our Court of Appeal recently summarized the circumstances in which a party can be added underRule 6-2(7) as follows: 21 Rule 6-2(7)(

b) has been interpreted narrowly, as being concerned with remedying defects in the proceedings. A plaintiff applicantmust establish either that the proposed defendant “ought to have been joined as a party” or that their “participation in the proceeding isnecessary”: Letvad v. Fenwick, 2000 BCCA 630 at paras. 16-17; Alexis v. Duncan, 2015 BCCA 135 at para. 15; and Byrd v. Cariboo(Regional District), 2016 BCCA 69 at para. 36. 22 Rule 6-2(7)(

c) is broader and therefore more commonly relied upon. A plaintiff applicant must establish that there is a questionor issue between the plaintiff and the proposed defendant that relates to or is connected with the relief, remedy, or subject matter of theproceeding. This threshold is low. It is generally expressed as establishing a real issue between the parties that is not frivolous, or that theplaintiff has a possible cause of action against the proposed defendant: The Owners, Strata Plan No. VIS3578 v. John A. NeilsonArchitects Inc., 2010 BCCA 329 at para. 45 [Neilson Architects]; Strata Plan LMS 1816 v.

Acastina Investments Ltd., 2004 BCCA 578[Acastina]; and MacMillan Bloedel Ltd. v. Binstead et al. (1981), (BC CA), 58 B.C.L.R. 173 (C.A.) [Binstead]. I woulddefine a frivolous issue as an issue that does not go to establishing the cause of action, does not advance a claim known to law, or servesno useful purpose and would be a waste of the court's time and public resources. This is similar to the considerations for determiningwhether a claim should be struck as “unnecessary, scandalous, frivolous or vexatious” under Rule 9-5(1)(b): see, for example, NevsunResources Ltd. v.

Araya, 2020 SCC 5 at paras. 65, citing in Willow v. Chong, 2013 BCSC 1083 at para. 20. 23 This threshold requirement is usually met solely on the basis of the proposed pleadings, but the parties may provide affidavitevidence addressing it. If evidence is provided, the court is limited to examining it only to the extent necessary to determine if therequired issue between the parties exists; it is not to weigh the evidence and assess whether the plaintiff could prove the allegations:Neilson Architects at para. 45, citing Acastina and Binstead.

Whether or not evidence is provided, it is necessary for the court to examinethe pleadings in order to determine whether the plaintiff has a possible cause of action against the proposed defendants. The pleadingsmust set out material facts sufficient to establish a real and not frivolous issue between the plaintiff and the proposed defendants: NeilsonArchitects at paras. 60, 62, and 75. 24 If this requirement is met, the court must next determine whether it would be just and convenient to decide the issue between theparties in the proceeding.

It is in relation to this issue that evidence is more commonly provided. This is a discretionary decision, whichdiscretion must be exercised judicially, and in accordance with the evidence adduced and the guidelines established in the authorities. InLetvad, this court adopted a list of factors to be considered from Teal Cedar Products

(1977) Ltd. v. Dale Intermediaries Ltd. (1996), (BC CA), 19 B.C.L.R. (3d) 282 (C.A), a decision that addressed the amendment of pleadings after the expiry of alimitation period. These factors include the extent of the delay, the reasons and any explanation for the delay, the expiry of a limitationperiod, the degree of prejudice caused by the delay, and the extent of the connection, if any, between the existing claims and theproposed new cause of action: Teal Cedar at para. 67; Letvad at para. 29; see also Chouinard v.

O'Connor, 2011 BCCA 161 at para. 21.In the context of adding parties, the last Letvad factor may be more accurately described as the extent of the connection, if any, betweenthe existing claim and the parties to be added. 25 The existence of a limitation defence is an important factor, as such a defence is extinguished if the proposed defendant is added:Limitation Act, R.S.B.C. 1996, c. 266, s. 4(1)(d), repealed and replaced with Limitation Act, S.B.C. 2012, c. 13, s. 22(1)(d); and Anonsonv. North Vancouver (City), 2017 BCCA 205 at para. 13. However, this is not determinative.

In Neilson Architects, this court adopted thefollowing approach to considering a limitation defence (at para. 47): If it is clear there is an accrued limitation defence, the question is whether it will nevertheless be just and convenient to add the party,notwithstanding it will lose that defence. The answer to that question will emerge from consideration of the factors set out in Letvad. 26 These principles were recently reiterated in Smithe Residences Ltd. v. 4 Corners Properties Ltd., 2020 BCCA 227 at paras. 49-51. [28] In addition, in Meade v.

Armstrong (City), 2011 BCSC 1591, at para. 16, Dley J. helpfully canvassed the applicableconsiderations in regards to a joinder application: [16] Mr. Meade's application is brought under Rules 6-1(1) and 6-2(7) of the Supreme Court Civil Rules.

These rules are to beinterpreted as follows: 1) A party should be added where that party's participation is necessary for the proper determination of the case: Van de Perre v.Edwards 2001 SCC 60 , [2001] 2 S.C.R. 1014 at para. 48; 2) The discretion to add parties should be generously exercised so as to enable effective adjudication upon all matters: NorthernConstruction Co. v. British Columbia Hydro and Power Authority, [1970] B.C.J.

No. 26 at para. 14; 3) In exercising the discretion to add a party, the court should not concern itself as to whether the action will be successful otherthan to be satisfied that there may exist an issue or question between the applicant and the party being joined: MacMillan Bloedel Ltd. v.Binstead, (BC CA), [1981] B.C.J. No. 1611 at para. 12; 4) Evidence is not required in support of a joinder application. The pleadings may be sufficient to establish that there is a question tobe tried between the parties: Lasik Vision Canada Inc. v. TLC Vancouver Optometric Group Inc., [1999] B.C.J.

No. 2796 at para. 15; 5) Where an applicant relies on pleadings alone, the facts alleged, which if assumed to be true, must disclose a cause of action:

Harrington (Guardian ad litem) v. Pappachristos, [1992] B.C.J. No. 2600; 6) Unless there is prejudice, amendments should be granted liberally to enable the issues to be tried: Langret Investments S.A. v.McDonnell, (BC CA), [1996] B.C.J. No. 550 at para. 43. [29] Since the parties’ submissions primarily focused on Rule 6-2(7)(c), I will approach my analysis in that manner. Analysis 1.

Whether there is a question or real issue between the parties that relates to therelief, remedy or subject matter of the proceeding [30] The threshold issue is whether there is a question or real issue between the Plaintiffs and the Proposed Defendants that relates tothe relief, remedy or subject matter of the proceeding (Madadi CA, at para. 22, citing The Owners, Strata Plan No. VIS3578 v. John A.Neilson Architects Inc., 2010 BCCA 329, at para. 45 [Neilson]). As distinct considerations apply to the addition of the proposed personaldefendants Mr. Campbell, Mr. Moses and Mr.

Neufeld, I will first address this issue in respect of the two proposed corporate defendants,Great Pacific and Accredit.

a) Addition of Great Pacific and Accredit as defendants [31] The Plaintiffs’ proposed amended pleadings name Great Pacific and Accredit as defendants. At paras. 22, 23 and 25, thePlaintiffs allege that 0848 is an agent acting on behalf of Great Pacific, which is an agent of Accredit, and that E-Pro and/or Mr. Bromleyacted upon the instructions of and with the knowledge of Great Pacific. They further allege that Mr. Campbell, Mr. Moses and Mr.Neufeld are agents for Great Pacific.

Based on those allegations of agency, the Plaintiffs say that Great Pacific and Accredit arevicariously liable for the claims against 0848 and its agents as well as E-Pro and Mr. Bromley. [32] At paras. 39-42 of their proposed amended pleadings, the Plaintiffs allege that Great Pacific (acting as agent for Accredit), Mr.Campbell, Mr. Moses and Mr. Neufeld, caused 0848 to be incorporated and take title to the Hallowell Property. The Plaintiffs allege thatthis was done for the purpose of insulating Accredit from potential liability in respect of the Hallowell Property.

They further allege thatthe title to the Hallowell Property was charged with a mortgage in excess of its value in favour of Accredit to delay, hinder, or defraudcreditors, which they say is either a fraudulent conveyance under the Fraudulent Conveyance Act or a fraudulent preference under theFraudulent Preference Act. [33] In terms of establishing a basis for the liability of the Proposed Defendants under the EMA, the Plaintiffs submit that theProposed Defendants are “responsible persons” within the meaning of s. 45, which reads as follows: Persons responsible for remediation of contaminated sites 45

(1) Subject to

section 46 [persons not responsible for remediation], the following persons are responsible for remediation of acontaminated site: (

a) a current owner or operator of the site; (

b) a previous owner or operator of the site; (

c) a person who (

i) produced a substance, and (ii) by contract, agreement or otherwise caused the substance to be disposed of, handled or treated in a manner that, in whole or inpart, caused the site to become a contaminated site; (

d) a person who (

i) transported or arranged for transport of a substance, and (ii) by contract, agreement or otherwise caused the substance to be disposed of, handled or treated in a manner that, in whole or inpart, caused the site to become a contaminated site; (

e) a person who is in a class designated in the regulations as responsible for remediation.

(2) In addition to the persons referred to in subsection (1), the following persons are responsible for remediation of a contaminatedsite that was contaminated by migration of a substance to the contaminated site: (

a) a current owner or operator of the site from which the substance migrated; (

b) a previous owner or operator of the site from which the substance migrated; (

c) a person who (

i) produced the substance, and

(ii) by contract, agreement or otherwise caused the substance to be disposed of, handled or treated in a manner that, in whole or in part, caused the substance to migrate to the contaminated site; (

d) a person who (

i) transported or arranged for transport of the substance, and (ii) by contract, agreement or otherwise caused the substance to be disposed of, handled or treated in a manner that, in whole or in part, caused the substance to migrate to the contaminated site.

(3) A secured creditor is responsible for remediation of a contaminated site if (

a) the secured creditor at any time exercised control over or imposed requirements on any person regarding the manner of treatment, disposal or handling of a substance and the control or requirements, in whole or in part, caused the site to become a contaminated site, or (

b) the secured creditor becomes the registered owner in fee simple of the real property at the contaminated site.

(4) A secured creditor is not responsible for remediation if it acts primarily to protect its security interest, including, without limitation, if the secured creditor (

a) participates only in purely financial matters related to the site, (

b) has the capacity or ability to influence any operation at the contaminated site in a manner that would have the effect of causing or increasing contamination, but does not exercise that capacity or ability in such a manner as to cause or increase contamination, (

c) imposes requirements on any person, if the requirements do not have a reasonable probability of causing or increasing contamination at the site, or (

d) appoints a person to inspect or investigate a contaminated site to determine future steps or actions that the secured creditor might take. [ 34 ] Specifically, the Plaintiffs rely on s. 45(2) which provides that a current or previous owner or operator of the site from which the substance (in this case, the contaminated soil) “migrated” is responsible for remediation of the contaminated site.

The Plaintiffs submit that Great Pacific and Accredit are secured creditors and/or owners of the site from which contaminated soil on their property migrated and that by directing E-Pro to move the contaminated soil from the Hallowell Property to their property, Great Pacific and Accredit are “responsible persons” within the meaning of the EMA . Notably, the term “migration” is not defined in the Act. In the Plaintiffs’ submission, “migration” means moving from one place to another, even with considerable separation. Quantum agrees with the Plaintiffs’

interpretation. [ 35 ] The Respondents contend with the Plaintiffs’

interpretation of the term “migration” within the meaning of s. 45 of the EMA on the basis that, in their submission, “migration” can only occur between neighbouring properties. They say that the Hallowell Property and the Plaintiffs’ property do not neighbour each other and therefore, s. 45(2) of the EMA does not apply. Further, they take issue with the fact that the Plaintiffs have adduced no authority to support their

interpretation of s. 45. [ 36 ] While there may be some novelty to the Plaintiffs’ submissions, in my view it is not plain and obvious that the Plaintiffs’ claims under the EMA are bound to fail. Whether any of the Proposed Defendants are “responsible persons” under the EMA is an issue for trial and it is not one that is appropriate to decide on this application. As submitted by Quantum, this issue is for argument on the proper

interpretation and application of the EMA in light of an entire evidentiary record. [ 37 ] The Respondents also take the position that the Plaintiffs failed to plead with sufficient precision facts which are material to a viable cause of action in their amended notice of civil claim. They allege that the Plaintiffs make standard or boilerplate allegations, and that they plead undifferentiated allegations against the Proposed Defendants and state conclusions of law (such as, for example, pleading the existence of agency relationships) without providing material facts to support those conclusions.

In support of their position, they primarily rely on Forde v. Interior Health Authority , 2007 BCSC 1706 [ Forde ]. [ 38 ] Forde concerned a joinder application in which the plaintiff pursued an action in negligence against various medical professionals in relation to healthcare services she received. The plaintiff brought a joinder application under Rule 15(5)(a)(iii) (now Rule 6-2(7)(c)) to add four additional medical professionals who were involved in her care. The proposed defendants sought to have her application dismissed on the basis that she failed to plead material facts giving rise to a cause of action.

Specifically, the proposed defendants argued that the plaintiff made “blanket allegations” against them despite the fact that they were not in an identical relationship to her. [ 39 ] Russell J. dismissed the plaintiff’s application on the basis that the pleadings failed to give rise to a cause of action: 17 I agree that the plaintiff has improperly made blanket allegations against the proposed defendants. The pleadings are imprecise and overly general.

Paragraph 23 of the Amended Statement of Claim alleges that the “Defendants, or any one combination thereof, and/or their servants or agents who treated, attended and advised the Plaintiff are guilty of negligence.” Paragraph 24 purports to set out the particulars of the negligence claim, containing 11 allegations that are applicable to one, several, or all of the defendants.

As has been pointed out by the respondents, if the defendants were involved in the plaintiff's care, they would have provided different types of care, for different reasons, at different times. 18 It is impossible to discern on what basis each of the proposed defendants could be held liable in negligence. This is further complicated by the fact that affidavit evidence of some of the respondent physicians suggests that they had nothing to do with the plaintiff's care at the relevant time. Thus, I agree with the respondents that merely setting out a list of negligent actions that may or may

not be applicable to each of the defendants on an individual level is so imprecise that it fails to give rise to a cause of action. [40] In my opinion, Forde is distinguishable. In Forde, the proposed defendants were clearly not in an identical relationship to theplaintiff as her allegations could have been applicable to one, several, or all of the proposed defendants. If the proposed defendants inthat case were involved in the plaintiff’s care, they were involved at different times and in different capacities.

By way of contrast, thePlaintiffs here allege that the Proposed Defendants are “responsible persons” within the meaning of the EMA and that they are in anagency relationship with the defendant 0848. Accordingly, in my view, the Plaintiffs’ amended notice of civil claim is sufficient becausethe facts as pleaded situate 0848 and the Proposed Defendants in an identical relationship to them.

Put another way, I am satisfied thatthe same facts, as set out in the Plaintiffs’ pleadings, give rise to the same causes of action in respect of the Plaintiffs’ claims against eachof 0848 and the Proposed Defendants. [41] As emphasized by our Court of Appeal in Neilson, at para. 45, I am not to weigh the affidavit evidence and assess whether thePlaintiffs could prove the allegations.

Rather, I am limited to examining the evidence only to the extent necessary to determine if therequired issue between the parties exists. [42] Here, the Plaintiffs adduced affidavits from Michael Kelly (the owner/principal of the Plaintiffs) and Susan Koehl (a legalassistant at the Plaintiffs’ counsel’s law firm), which include copies of invoices, emails, and transcripts from the December 12, 2016examination for discovery of Mr. Bromley.

In my view, at a minimum and taken at face value, the affidavit evidence in its totalityreveals that the allegation that the Proposed Defendants had some involvement in engaging and directing Mr. Bromley and/or E-Pro withrespect to moving the contaminated soil from the Hallowell Property (or other properties) to the Plaintiffs’ property has merit.

Thatevidence in turn may give rise to a number of issues between the Plaintiffs, Quantum, Great Pacific, and Accredit in the underlyingproceeding, including: • whether Great Pacific and/or Accredit were the owners or operators of the Hallowell Property from which the contaminated soilwas transported to the Plaintiffs’ property; • whether Great Pacific and/or Accredit were secured creditors of a property owned by E-Pro at 1012 Yates Street, Victoria, BritishColumbia, from which the contaminated soil was transported to the Hallowell Property and then to the Plaintiffs’ property; • if and to what extent was Great Pacific and/or Accredit responsible for directing, instructing, and overseeing the removal,transportation, and delivery of the contaminated soil to and from various properties; • whether there is an agency relationship between 0848, Great Pacific, and Accredit in respect of the directing, handling,transporting, and delivering the contaminated soil to the Plaintiffs’ Property; • whether Great Pacific and/or Accredit are “responsible persons” under the EMA, and if so, to what extent they are liable forremediation costs; and • if and to what extent Great Pacific and Accredit are liable under the Negligence Act, R.S.B.C. 1996, c. 333 for the purposes ofcontribution and indemnification. [43] I have concluded that, in light of the extensive affidavit evidence adduced by the Plaintiffs in support of their application, I amsatisfied that the threshold of whether there is a question or real issue between the Plaintiffs, Great Pacific, and Accredit relating to theproceeding is established.

b) Addition of the proposed personal defendants [44] I turn now to whether the proposed personal defendants Mr. Campbell, Mr. Moses and Mr. Neufeld should be added asdefendants. I have concluded that they should not be added as parties to the action. [45] In their amended notice of civil claim, the Plaintiffs name the proposed personal defendants as “businessmen.” The Plaintiffsallege that at all material times, Mr. Bromley and his company, E-Pro, acted on the instructions of and with the knowledge of “… thedefendants Campbell, Moses, and Neufeld,” who they say are agents for Great Pacific.

They further allege that at all material times, theproposed personal defendants were the officers and/or directors of 0848, Great Pacific, and Accredit; and that they directed or instructedMr. Bromley and/or E-Pro in regards to the relocation of the contaminated soil. [46] One of the authorities relied on by the parties, Neilson, involved a similar application to add four personal defendants who werealleged to be the directors/officers of the proposed corporate defendants.

Neilson J.A., writing for the Court, distilled the issue asfollows: “whether the proposed amendments in the further amended statement of claim establish the owners [plaintiffs] have a possiblecause of action against these four individuals, thereby justifying their addition as defendants” (at para. 62). Although she determined thata full analysis of the personal liability of corporate officers, directors, and employees was beyond the scope of the appeal (at para. 62),Neilson J.A. provided the following

summary of the applicable legal principles with respect to adding personal defendants in conjunctionwith their respective corporate entities: 66 The fact that a director, officer or employee was acting within the course of employment and the corporation is vicariously liablefor his negligence does not preclude a claim in negligence against the employee personally. However, in my view, the London Drugsprinciple [see London Drugs Ltd. v.

Kuehne & Nagel International Ltd., (SCC), [1992] 3 S.C.R. 299 at 407-408]requires that claims against the individual must be based on a breach of a duty of care that would support an action against the individualpersonally. The material facts that would support that personal claim in tort must be specifically pleaded to establish a possible cause ofaction under R. 15(5)(a)(iii) [now Rule 6-2(7)(c)]. [Emphasis added.] [47] Neilson J.A. reviewed Strata Plan LMS 2262 v. Stoneman Developments Ltd., 2004 BCSC 828, and Strata Plan LMS 2643 v.

Harold Developments Ltd. , 2007 BCSC 1095 , wherein the court allowed the individual defendants to be added even though “the contested allegations setting out proposed claims against the individual principals of the corporate defendants were identical to the claims made against the companies” ( Neilson , at para. 70). She concluded that those two cases were wrongly decided: 71 In my view, those cases were wrongly decided. First, they incorrectly characterized the law of this province with respect to claims in negligence against individual representatives of corporations as unsettled.

Second, the pleadings in both cases failed to allege material facts sufficient to establish personal breaches of duty in negligence that would support a cause of action against the individuals apart from any corporate liability. It is not enough to plead undifferentiated allegations against the corporation and its directors and employees . 72 Here, the chambers judge properly found the owners' allegations of negligence against Messrs. Popham, Morris, Tearle, and Sterling are inadequate to support their joinder as defendants.

The further amended statement of claim does not set out material facts to support commission of an independent tort. The proposed amendments simply introduce the individuals as directors or employees of their corporate entities and then allege that they owed the same duties, committed the same breaches, and caused the same damages as their companies.

Nothing in the pleading indicates why the corporate veil should be pierced to find liability on the part of these four individuals . 73 Nor did the owners provide any evidence of the roles played by the four individuals in the construction of the Metropolitan, except to say that Messrs. Morris, Tearle and Sterling appeared on a list of "contacts" for their respective companies. [Emphasis added.] [ 48 ] Similarly, I am of the view that the Plaintiffs have failed to plead material facts sufficient to ground independent claims against the proposed personal defendants.

The allegations against the proposed personal defendants are undifferentiated from those against Great Pacific and Accredit. In the words of Neilson J.A. in Neilson at para. 73, “[t]he proposed amendments simply introduce the individuals as directors or employees of their corporate entities and then allege that they owed the same duties, committed the same breaches, and caused the same damages as their companies.” On the affidavit evidence and the Plaintiffs’ amended notice of civil claim before me, it is apparent that if the proposed personal defendants did in fact “direct or instruct” Mr.

Bromley and/or E-Pro, they were doing so only in their corporate capacity on behalf of either 0848, Great Pacific and/or Accredit.

Put another way, there is no indication that the proposed personal defendants were acting independently of their respective corporate entities. [ 49 ] Accordingly, as I am not persuaded that the pleadings or the affidavit evidence sufficiently establish why the corporate veil should be pierced, I have concluded that the proposed personal defendants should not be joined to the action. [ 50 ] As I am satisfied that the Plaintiffs have met the threshold to add Great Pacific and Accredit as defendants, I must now determine whether it would be just and convenient to do so.

As I proceed, when I refer to the “Proposed Defendants” I will be referring only to Great Pacific and Accredit. 2. Whether it would be just and convenient to add the Proposed Defendants [ 51 ] In exercising my discretion I will individually address the so-called “ Letvad factors” (as referred to in Madadi CA , at para. 24 ), which are as follows:

a) the extent of the delay, as well as the reasons and any explanation for the delay;

b) the degree of prejudice caused by the delay;

c) the extent of the connection, if any, between the existing claims and the proposed new cause of action; and

d) the expiry of a limitation period.

a) Delay [ 52 ] The Respondents claim that there has been an inordinate and inexcusable delay in adding the Proposed Defendants as parties to the action because they were known or reasonably ought to have been known as a result of documents disclosed by 0848 to the Plaintiffs in November 2012. They say that these documents contain specific references to Great Pacific and Accredit. Further, they say that it was incumbent upon the Plaintiffs to examine Mr. Bromley for discovery much earlier in the proceedings, and that no party has yet asked to examine a representative of 0848.

In essence, they argue that the Plaintiffs failed to exercise due diligence, and that they are to blame for any delay in adding the Proposed Defendants. [ 53 ] The Plaintiffs argue that, at the time they commenced the action, they knew 0848 was the owner of the source site of the contaminated soil based on the fact that 0848 admitted that it was the registered owner of the property; and that, in his pleadings in response to the action filed on September 21, 2012, Mr. Bromley admitted that 0848 paid Quantum to dispose of soil located on its property. Based on Mr.

Bromley’s response, the Plaintiffs submit that there was no reason for them to take any other steps other than to proceed to trial and that examination for discovery was unnecessary because their case was proved by the pleadings. [ 54 ] According to the Plaintiffs, they accepted the advice of their counsel at the time that there was no need to proceed to discovery. Relying on Brandt v. Volkswagon Group Canada Inc., 2014 BCSC 2380 , at paras. 35-40 [ Brandt ], and McIntosh v. Nilsson Bros.

Inc. , 2005 BCCA 297 , at para. 10 [ McIntosh ], the Plaintiffs submit that they should not be prejudiced by the decisions of their counsel in not suing or claiming against the Proposed Defendants earlier on. They further submit that other documents known at the time the action was commenced did not indicate any further investigation was required because they were either irrelevant to the contamination of their property or they revealed information already known to them. [ 55 ] In Brandt , Weatherill J. stated that the relevant period to be examined in relation to delay in a joinder application is the time

between the date that the plaintiff became aware of the need for the joinder application and the date of the joinder application (at para. 25). He found that the plaintiff’s lawyer had failed to take basic steps to ascertain the identity of the party to be added, but that the plaintiff should not be prejudiced by the decisions of his counsel (at paras. 35-40). In declining to find fault on behalf of the plaintiff for his counsel’s shortcomings, Weatherill J. referred to McIntosh , at para. 10 , where our Court of Appeal stated: [10] I would like to add one further point.

The question of what is “just and convenient to determine as between the person and that party” within the concluding words of Rule 15(5)(a)(iii) [now Rule 6-2(7)(c)] requires a close focus on balancing the interests of the existing parties and the person sought to be added. It is important not to be diverted from the conduct of the parties to the conduct of their lawyers, except to the extent that the conduct of the lawyers may be at the heart of real prejudice to the other side.

In this case, the plaintiffs were neither the cause of the failure to add Bavaria in the first instance nor the cause of any of the delays. They should not be prejudiced because of conduct on the part of their lawyer unless that conduct was the cause of irremediable prejudice to the other side. As I have said, that is not so here. [ 56 ] Quantum submits that it was not until 0848 provided its amended list of documents and disclosed documents in September 2016 that the nature of the relationship between Great Pacific, Mr. Bromley, E-Pro and the Hallowell Property became apparent.

It says that it only learned of Accredit’s role as the principal of Great Pacific through the findings of fact in the decision of EY Holdings Ltd. v. Great Pacific Mortgage Investment Ltd. , 2017 BCSC 129 . Additionally, it says that the examination for discovery of Mr. Bromley on December 12, 2016 also revealed further information about the relationship between the parties. [ 57 ] The Plaintiffs filed their joinder application seeking to add Great Pacific and Accredit as defendants on September 15, 2017; Quantum filed and served its application on September 25, 2017.

As such, Quantum says that, given that both parties filed their applications to add Great Pacific and Accredit within less than one year of the examination for discovery of Mr. Bromley, there has not been an unreasonable delay in light of the procedural history of the action.

It says that any delay was due to applications sought and obtained by 0848 for further document disclosure (which was the subject of Voith J.’s 2017 decision). [ 58 ] In addressing the Respondents’ position that Great Pacific and Accredit were known or reasonably ought to have been known in November 2012, Quantum says that the documents known to Quantum in 2012 and 2013 did not reveal the potential involvement of 0848’s parent companies. From Quantum’s perspective, the fact that 0848 had a parent company, without more, did not mean that the parent company could be liable.

Just because a mortgage company was paying for the remediation of the Hallowell Property did not mean that, as secured creditors with a financial interest, they were responsible for the remediation costs as “responsible persons” under the EMA . [ 59 ] Based on the allegations made by 0848 in its response to civil claim and its failure to disclose relevant documents about the role of its parent company (or companies) regarding the contaminated soil, Quantum submits that it could not reasonably have been expected to ask the questions that would have led it to discover its proposed third party claims against Great Pacific and Accredit prior to 2016, particularly as the documents known to Quantum in 2012 and 2013 did not contain any information that contradicted 0848’s position in its response to civil claim. [ 60 ] Lastly, in Quantum’s submission, the courts have found that not adding third parties in similar circumstances has the “undesirable effect of further delay and therefore greater prejudice to the proposed third parties … the balance of convenience typically favours joinder, even if there has been inexcusable or unexplained delay” (relying on Hendrix v.

Handa Travel Student Trip Ltd. , 2016 BCSC 620 , at paras. 66 , 84). [ 61 ] In Madadi v. British Columbia (Teacher Regulation Branch) , 2020 BCSC 765 , at para. 47 , aff’d 2021 BCCA 10 , Matthews J. summarized the applicable principles pertaining to delay in the context of joinder applications: 47 On review of the cases referred to by the parties, including Byrd CA; Chouinard; Brar; Moldovan v. Republic Western Insurance Company , 2011 BCCA 418 , I summarize principles in assessing delay as follows:

a) explanations should be specific and not contradicted by other evidence in order to amount to reasonable explanation;

b) where a party is represented, delay that is attributable to counsel or based on the failure to give any or adequate advice is not held against the plaintiff to the same degree as it would be if the plaintiff was personally responsible for it;

c) where a party is self-represented, the court should give consideration to that status;

d) whether the delay was tactical is relevant; and

e) in order for delay to give rise to prejudice, the prejudice must be associated with the delay. [ 62 ] In my review of the record, I have concluded that new material information pertaining to Great Pacific’s and Accredit’s potential involvement in the subject matter of the action arose through 0848’s September 2016 disclosure on the eve of trial, and through the examination for discovery of Mr.

Bromley following that late disclosure in December 2016. [ 63 ] Indeed, the September 2016 disclosure was significant enough that Dorgan J., in her decision dated September 12, 2016 (Victoria Registry No. 16746), ordered an adjournment and ordered that 0848 bear the costs. The subject application arises directly as a result of 0848’s disclosure on the eve of trial. The temporal connection is persuasive. [ 64 ] Even though the Plaintiffs commenced their action in 2011, they (and Quantum) appeared to have learned significant information about Great Pacific and Accredit for the first time in 2016.

In light of that information, they filed an application to join the Proposed Defendants in September 2017; approximately one year after receiving disclosure from 0848. Further, based on the factual circumstances the Plaintiffs (and Quantum) claim to have known prior to September 2016, I am persuaded by the Plaintiffs’ submission that they should not be prejudiced by the tactical decisions of their counsel to not sue or further investigate the involvement of the Proposed Defendants (see Brandt , at paras. 35-40 ).

[ 65 ] Given the significance of the facts that became known because of the September 2016 disclosure and the December 2016 examination for discovery of Mr. Bromley and the procedural context of this litigation, which is rooted in events that occurred now over a decade ago, I find that such a delay in bringing the joinder application is insignificant. [ 66 ] This factor weighs in favour of adding Great Pacific and Accredit as defendants.

b) Prejudice [ 67 ] In terms of actual prejudice caused by delay, the Respondents say that certain documents are no longer available; that the Plaintiffs’ allegations of fraud against them are inherently prejudicial; that memories of witnesses have faded; and that the addition of the Proposed Defendants will increase trial time and further delay this proceeding. [ 68 ] The Plaintiffs contend that there are sufficient facts in the pleadings so the Proposed Defendants know the case they need to meet; particularly since the principals of 0848, which has been a defendant in this litigation from the outset, are also the principals of Great Pacific and Accredit. [ 69 ] The Plaintiffs rely on Brandt , at para. 41 for the proposition that the proposed defendant has the burden of demonstrating actual prejudice, and that although prejudice may be presumed by the loss of a limitation defence, the proposed defendant must show that their ability to mount a full defence has been imperiled in some way.

In Brandt , Weatherill J. concluded that, in the absence of any evidence of irremediable prejudice resulting from delay, the balance of prejudice overwhelmingly favoured adding the new party as a defendant (at paras. 43, 45). [ 70 ] Quantum submits that prejudice to the Proposed Defendants is further mitigated by the fact that the Plaintiffs have not set a trial date and 0848 has not sought to examine the representatives of any party other than Mr. Bromley. [ 71 ] Some prejudice must be presumed where there is significant delay; but that does not mean that there is actual prejudice ( Neilson , at paras. 94-102).

In Neilson , there was a 12-year delay in bringing the joinder application. Neilson J.A. did not find that actual prejudice was borne out on the evidence: one of the proposed defendants led no evidence of prejudice; several respondents stopped their operations when the condo project was completed, but documents and employees were lost and dispersed before the owners could have been reasonably expected to contemplate litigation, which was no fault of the owners; and the respondents failed to provide evidence of their efforts to locate the supposed lost documents and dispersed employees.

Importantly, prejudice was mitigated by the fact that the respondents provided evidence that the original defendants had retained and produced voluminous documents in the action to date. [ 72 ] In Strata Plan BCS 3206 v. KBK No. 11 Ventures Ltd. , 2019 BCSC 1033 , at para. 28 [ KBK ], Master Muir cited the following paragraphs of Chouinard v.

O'Connor , 2011 BCCA 161 in respect of the issue of prejudice, which I find are instructive: [23] I agree that in considering the Teal Cedar factors, a chambers judge should consider only those matters that affect a defendant's ability to defend the case under the rubric “prejudice”. Mere inconvenience or annoyance will not necessarily amount to prejudice. [24] In the case before us, the chambers judge correctly identified certain factors that constituted genuine prejudice to the defendants - the disappearance of documents and the unavailability of witnesses.

These factors, however, do not appear, in and of themselves, to have convinced the chambers judge to exercise his discretion against the plaintiff. The prejudice was not overwhelming. There was no finding that the witnesses who were unavailable were critical to the defence case.

The documents that had been disposed of were of greater concern, but the defendants did not provide definitive evidence as to when the documents had been destroyed, nor was it clear that documents that were in the possession of the defendants would be incapable of filling the void left by documents that had been disposed of. [25] The chambers judge was also troubled by the fact that the amendments would result in the defendants unfairly losing their trial date and having the litigation prolonged.

The defendants had been diligent in pressing the matter on for trial, and presented considerable evidence of difficulties that would be caused by an adjournment. I agree with the appellant that none of these factors constituted “prejudice” in the narrow sense of that term. [26] I do not, however, agree with the appellant's contention that these various factors should have been ignored by the trial judge.

Where a defendant has expended considerable effort to advance the litigation, and has taken steps to ensure that a trial will go ahead, it would be unfair to ignore hardship that the defendant would face as a result of additional delays and as a result of the addition of new causes of action after the expiry of the limitation period. This is particularly true when no compensation will be available to the defendant to mitigate the personal hardships that he or she must endure.

While these factors do not constitute “prejudice” as that term is used in Teal Cedar, they are factors that the judge can take into account in determining whether it is “just and convenient” to allow a cause of action to be added after the expiry of the limitation period. [27] I do not wish to suggest that hardship and inconvenience for a defendant will be critical factors in deciding whether to allow a new cause of action to be pleaded after the expiry of the limitation period.

In cases where these factors are present, however, they may play some role in considering the importance of the length of the delay. [ 73 ] On the subject application, I find that there was approximately one year or less from the time that the Plaintiffs became aware of the potential need to add Great Pacific and Accredit in September 2016 as parties and the date of the joinder application. This is not a significant time period in the context of the overall litigation and is explained by the litigation steps that were taken during that period.

As Master Muir observed in KBK , at para. 29 , in my view the prejudice alleged by the Respondents appears to stem “solely from the fact that they would be forced to participate in this action and face the claims proposed.” [ 74 ] If Great Pacific and Accredit were added as defendants, they would have ample time and opportunity to review the steps taken so far in this litigation. They would have access to the voluminous documents produced thus far in the action, including all of the evidence generated by the parties up to this date.

Reviewing these materials would not be insurmountable given that the Plaintiffs have yet to set a

trial date. Additionally, if Great Pacific and Accredit are in fact parent companies of 0848 and their principals are the same, they wouldbe well aware of what has happened in this litigation. [75] Further, there is no evidence that documents have disappeared or that witnesses are unavailable. [76] Ultimately, on balance, Great Pacific and Accredit would not likely suffer prejudice as a result of the Plaintiffs’ delay in bringingthe joinder application. [77] This factor weighs in favour of adding Great Pacific and Accredit as defendants.

c) Connection between the existing action and the new parties [78] There is strong evidence to support a connection between the existing action and the Proposed Defendants. The claims againstthe defendants, Great Pacific and Accredit are connected, arising out of the same factual circumstances. [79] I am satisfied that, on the Plaintiffs’ affidavit evidence, there is a factual basis to support the addition of Great Pacific andAccredit. There are a number of potential real and not frivolous issues between the parties.

Ultimately, the key is if and to what extentGreat Pacific and Accredit are liable in relation to the Plaintiffs’ EMA cost recovery claim, as well as to the Plaintiffs’ claims innegligence and breach of contract. If the Plaintiffs’ claims are ultimately successful there is little doubt that Quantum will seekcontribution and indemnification from Great Pacific and/or Accredit. [80] This factor weighs in favour of adding Great Pacific and Accredit as defendants.

d) Existence of a limitation defence [81] In Neilson, Neilson J.A. set out the following approach for considering the existence of a limitation defence in the context of ajoinder application: 47 The existence of a limitation defence is a relevant, but not determinative, factor in deciding whether to permit joinder, since theeffect of s. 4(1)(

d) of the Limitation Act is to extinguish such a defence if the proposed defendant is added. In Brito (Guardian ad litemof) v. Wooley (1997), 15 C.P.C. (4th) 255, [1997] B.C.J. No. 2487, Joyce J. set out a three step approach to considering a possiblelimitation defence, which was adopted by this Court in Strata Plan LMS 1725 v. Star Masonry Ltd., 2007 BCCA 611, 73 B.C.L.R. (4th)154 at para. 12.

I summarize it as follows: 1) If it is clear there is no accrued limitation defence, the only question is whether it will be more convenient to have one or twoactions since the plaintiff will be able to commence a new action against the proposed defendant if it is unsuccessful in the joinderapplication. 2) If it is clear there is an accrued limitation defence, the question is whether it will nevertheless be just and convenient to add theparty, notwithstanding it will lose that defence.

The answer to that question will emerge from consideration of the factors set out inLetvad. 3) If the parties disagree as to whether there is an accrued limitation defence, and a court cannot determine this issue on the joinderapplication, the court should proceed by assuming that there is a limitation defence, and consider whether it is just and convenient to addthe party, even though the result will be the elimination of that defence.

If that question is answered affirmatively, an order for joindershould be made, and it becomes unnecessary to deal with the limitation issue since it will be extinguished by s. 4(1)(

d) of the LimitationAct. 48 There is also a fourth option, an alternative to the third step, set out by Lambert J.A. in Lui v. West Granville Manor Ltd., (BC CA), [1987] 4 W.W.R. 49, 11 B.C.L.R. (2d) 273 at 303 (C.A.) [Lui No. 2].

He suggested that when the limitation issuecould not be determined on the joinder application, and the applicant had not established that considerations of justice and conveniencejustified extinction of the limitation defence under s. 4(1) of the Limitation Act, judicial discretion could be exercised to permit joinder onterms that the limitation defence would be preserved and determined at trial. That approach was considered and adopted in Strata PlanNo. VR 2000 v. Shaw, [1998] B.C.J. No. 1086 (S.C.) [Shaw] and Stone Venepal (Celgar) Pulp Inc. v. IMO Industries (Canada) Inc.,2008 BCCA 317, 83 B.C.L.R. (4th) 138.

I note that in Thom v. Laird Custom Homes Ltd., 2017 BCSC 1577, at para. 36, Williams J. observed that “the weight of authority doesnot support the ‘fourth option’ referenced by the court in Neilson.” [82] The Limitation Act governs the question of whether an accrued limitation defence exists. Subsection 6(1) of the Limitation Actprovides that “a court proceeding in respect of a claim must not be commenced more than 2 years after the day on which the claim isdiscovered.”

Section 8 provides that a claim is discovered by a person on the first day on which the person knew or reasonably ought tohave known all of the following: (

a) that injury, loss or damage had occurred; (

b) that the injury, loss or damage was caused by or contributed to by

an act or omission; (

c) that the act or omission was that of the person against whom the claim is or may be made; (

d) that, having regard to the nature of the injury, loss or damage, a court proceeding would be an appropriate means to seek toremedy the injury, loss or damage. [83] As submitted by the Respondents, by virtue of the transition provision under s. 30 of the Limitation Act, EMA cost recovery

claims discovered after June 1, 2013 are subject to a two-year limitation period and those discovered prior to June 1, 2013 are subject to a six-year limitation period (see J.I. Properties Inc. v. PPG Architectural Coatings Canada Inc. , 2014 BCSC 1619 , at paras. 51-60 [ J.I. Properties ], aff’d 2015 BCCA 472 ). [ 84 ] In addition, s. 22(1) (

d) of the Limitation Act provides that new defendants may be added to a proceeding even though a limitation period applicable to a claim has expired. It reads as follows: 22

(1) If a court proceeding has been commenced in relation to a claim within the basic limitation period and ultimate limitation period applicable to the claim and there is another claim (the “related claim”) relating to or connected with the first mentioned claim, the following may, in the court proceeding, be done with respect to the related claim even though a limitation period applicable to either or both of the claims has expired: ... (

d) new parties may be added or substituted as plaintiffs or defendants. [ 85 ] It is conceded by the parties that all of the elements under s. 8 (a), (

b) and (

d) of the Limitation Act with respect to the Plaintiffs’ discovery of their claim are established. Therefore, the existence of an accrued limitation defence turns on whether the Plaintiffs knew or reasonably ought to have known that that the act or omission that caused or contributed to injury, loss or damage was that of Great Pacific and/or Accredit pursuant to s. 8 (c).

Put another way, I must decide whether the Plaintiffs knew or ought to have known the basis for a cause of action against Great Pacific and/or Accredit prior to 0848’s document disclosure in September 2016. [ 86 ] The Plaintiffs submit that they did not know or could not have reasonably known that the “acts or omissions” were that of the Proposed Defendants until 0848’s document disclosure in September 2016 and the examination for discovery of Mr. Bromley in December 2016.

They say that new material facts came to light that provided the basis for them to discover for the first time a potential cause of action against the Proposed Defendants. Prior to the 2016 disclosure, the Plaintiffs say that they were prepared to proceed to trial on the footing that the only issue to be decided was damages, not liability. [ 87 ] They rely on J.I.

Properties , at paras. 42-50 , for the following propositions in relation to limitation periods in remediation cost recovery actions under the EMA : 1) the EMA is a complete code for dealing with contaminated sites; 2) liability extends to all costs of remediation reasonably incurred, which could include costs incurred over many years; and 3) if costs within the limitation period are incurred before initiating a claim, then all remediation costs (including amounts paid for services rendered by contractors, consultants, and legal counsel) reasonably incurred before that date are also recoverable.

On that basis, the Plaintiffs submit that they need only establish that the Proposed Defendants are “responsible persons” under s. 45 of the EMA .

They also say that remediation is not yet complete (or at least there is a question as to whether it is complete), and that the limitation period has not expired regarding cost recovery because the period starts only when remediation is complete and all costs have been incurred. [ 88 ] The Respondents submit that the Plaintiffs’ position regarding the discovery of their claim is untenable in light of the affidavit evidence, which they say indicates that: 1) at the time the Plaintiffs filed their notice of claim, they believed that the principals of 0848 were directing the defendants Mr.

Bromley and E-Pro in respect of the Hallowell Property but took no further steps to determine who they were; and 2) the Plaintiffs’ belief as to who was directing Mr.

Bromley in respect of the Hallowell Property has not changed since they first filed their notice of civil claim. [ 89 ] On the totality of the record, I find that there is no accrued limitation defence. [ 90 ] While there is, in my view, perhaps some indication that the Plaintiffs knew of the existence of Great Pacific and/or Accredit prior to 0848’s document disclosure in September 2016, I am unable to conclude that the Plaintiffs knew or reasonably ought to have known the extent of their involvement in regards to a potential cause of action.

I am persuaded by the Plaintiffs’ submission that, prior to September 2016, they knew that 0848: 1) was the registered owner of the source site of the contaminated soil; 2) retained E-Pro to remediate the contaminated soil; and 3) hired Quantum to dispose of the contaminated soil.

At that time, the issue for trial was the amount of damages, not liability. [ 91 ] When considered in the overall context of this litigation, I am of the view that some of the documents revealed in 0848’s disclosure paint a different picture than what the Respondents allege in respect of the potential involvement of Great Pacific and Accredit. I wish to highlight some specific documents that were disclosed in 0848’s 2016 disclosure that are, in my opinion, significant: • An invoice dated February 18, 2020 rendered by Mr. Bromley on behalf of E-Pro to Mr.

Campbell on behalf of Great Pacific regarding remediation work at the Hallowell Property. • An email exchange on February 2, 2010 between Mr. Bromley and Mr. Campbell regarding remediation work at the Hallowell

Property. Mr. Campbell used a corporate email address affiliated with Great Pacific. • An email from Mr. Bromley to Mr. Campbell dated April 26, 2010 in which Mr. Bromley attached a cost estimate for the removal of a stockpile of soil from the Hallowell Property and sought authorization from Mr. Campbell to remove it. • An email from Mr. Campbell (using a Great Pacific email address) to Mr. Bromley dated May 1, 2010 in which he authorized Mr. Bromley to “proceed and complete the environmental requirements of the site so that we can sell the project.” • An email from Mr. Bromley to Mr.

Campbell dated May 20, 2010 regarding an invoice for a disposal of the contaminated soil from the Hallowell Property. Mr. Bromley advised on further steps to obtain Certificate of Compliance so that Mr. Campbell would “be free to be utilized/developed (sic) this land as desired.” Mr. Bromley also wrote: “… We have been hit with an onslaught of Phase I reports recently. If it is ok, we can start on this last phase of site closure post payment if this invoice is submitted. I need some of these funds to pay for the disposal of these fluids as it is a real hodge-podge …” • An email from Mr.

Campbell (using a Great Pacific email address) to Mr. Bromley dated May 21, 2010 in which he requests to meet Mr. Bromley “on site [at the Hallowell Property] when you are blocking off the road and we can make a decision as to how thorough we want to be in blocking access to the site.” • Email correspondence between Mr. Campbell and a representative of the Town of View Royal dated October 6, 2010 in which the representative advised Mr. Campbell that his staff were looking into materials being dumped onto the Hallowell Property. Mr. Campbell confirmed that he would look into it. • An email from Mr. Bromley to Mr.

Campbell dated October 28, 2010 in which he wrote: Rory: View Royal needs something very brief from you effectively stating that “E-Pro is allowed to move this soil off your 140 Hallowell Road, Thetis Cove property for soil relocation purposes.” [Name of city planner omitted]’s email address is [email address omitted]. The soil is scheduled to go out tomorrow morning. Thank you for getting this to [name of city planner omitted] in short order. … [ 92 ] Further, from the transcript of the examination for discovery of Mr. Bromley on December 12, 2016 and the above documents, it is apparent that Mr.

Bromley regularly communicated with, informed, and took instructions from the directors of 0848 regarding the remediation of the Hallowell Property, whom he considered were also directors of Great Pacific and/or Accredit. [ 93 ] My finding that there is no accrued limitation defence weighs in favour of adding Great Pacific and Accredit as defendants and I am able to conclude that it would be more convenient to have one action as opposed to two. [ 94 ] In the alternative, if I am incorrect in finding that there is no accrued limitation defence, I am of the view that it is nonetheless just and convenient to add Great Pacific and Accredit as defendants even though it would eliminate that defence.

I note that, pursuant to s. 22(1) (

d) of the Limitation Act , Great Pacific and Accredit may be added as defendants to the action regardless of whether it would extinguish their limitation defence. Even if the Plaintiffs could have discovered the claim with due diligence prior to 2016, the delayed document disclosure is so significant that it tips the scale in favour of adding Great Pacific and Accredit, even if a limitation defence is extinguished. 3.

Conclusion regarding the Plaintiffs’ joinder application [ 95 ] I have concluded that there is a question or real issue between the Plaintiffs and Great Pacific and Accredit that relates to the relief, remedy or subject matter of the proceeding. I find that the Letvad factors outlined in Madadi CA , at para. 24 , all weigh in favour of adding Great Pacific and Accredit, and accordingly, I have concluded that in all of the circumstances it would be just and convenient to add them as defendants. [ 96 ] Further, I have concluded that the proposed personal defendants Mr. Campbell, Mr. Moses, and Mr.

Neufeld should not be added as defendants. [ 97 ] I turn now to address Quantum’s third party notice application. 4. Quantum’s third party application [ 98 ] Quantum seeks leave to amend its third party notice to add Great Pacific and Accredit as third parties for the purposes of contribution and indemnity.

Specifically, Quantum seeks to add Great Pacific and Accredit as third parties to clarify the existing third party claims against the existing third parties; and to add claims against them based on their relationship to the source site of contamination and their engagement and direction of the defendants E-Pro and Mr. Bromley.

The Plaintiffs commenced their action on September 19, 2011 and Quantum filed its response and original third party notice on December 15, 2011. [ 99 ] As the basis for its third party notice application, Quantum relies on Rule 3-5, which reads in part as follows: Rule 3-5 — Third Party Claims Making a third party claim

(1) A party against whom relief is sought in an action may, if that party is not a plaintiff in the action, pursue a third party claim against any person if the party alleges that

(

a) the party is entitled to contribution or indemnity from the person in relation to any relief that is being sought against the party inthe action, (

b) the party is entitled to relief against the person and that relief relates to or is connected with the subject matter of the action, or (

c) a question or issue between the party and the person (

i) is substantially the same as a question or issue that relates to or is connected with (

A) relief claimed in the action, or (

B) the subject matter of the action, and (ii) should properly be determined in the action. … Third party need not be party to original action

(2) A third party claim may be pursued against a person, whether or not that person is a party to the action. Pursuing a third party claim

(3) Subject to subrule (4), a party wishing to pursue a third party claim referred to in subrule (1) must file a third party notice inForm 5 that accords with Rule 3-7. When leave is required

(4) A party may file a third party notice (

a) at any time with leave of the court, or (

b) without leave of the court, within 42 days after being served with the notice of civil claim or counterclaim in which the reliefreferred to in subrule (1) is claimed. … Application of rules

(11) Except to the extent that this rule otherwise provides, Rules 3-1 and 3-3 apply to a third party notice as if it were a notice of civilclaim and to a response to third party notice as if it were a response to civil claim. [100] In Tyson Creek Hydro Corp. v. Kerr Wood Leidal Associates Ltd., 2013 BCSC 1741, Goepel J., as he then was, summarized therelevant considerations pertaining to whether the court should exercise its discretion to grant leave under Rule 3-5(4) as follows: 39 In Lui v.

West Granville Manor Ltd. (1985), (BC CA), 61 B.C.L.R. 315 at 327, 18 D.L.R. (4th) 391 (C.A.)[Lui], which was decided under the 1976 Rules, Lambert J.A. stated that the purpose of third party proceedings was to avoid the problemof having different results on the same issue between the same parties and to avoid a multiplicity of proceedings. 40 In MacNaughton, McLachlin J.A. explained, at 21, the purpose of third party proceedings as follows: Third party pleadings function as a special type of statement of claim. Indeed, the claim they embody could be brought by separateaction.

But to avoid a multiplicity of proceedings, the rules permit the claim to be made in the action which has been commenced againstthe defendant. The object of permitting third party proceedings to be tried with the main action is to provide a single procedure for theresolution of related questions, issues or remedies, in order to avoid multiple actions and inconsistent findings, to provide a mechanismfor the third party to defend the plaintiff's claim, and to ensure the third party claim is decided before a defendant is called upon to paythe full amount of any judgment.

The avoidance of a multiplicity of proceedings is fundamental to our rules of civil procedure. This hasbeen the case since the reforms effected by the Judicature Acts in the nineteenth century. As Cotton L.J. stated in Searle v. Choat (1884),25 Ch. D. 727: “the whole tenor of the Judicature Acts is to require all proceedings as far as possible to be taken in one action”. EXERCISE OF DISCRETION 41 In Lui, Lambert J.A. noted that the court is given a wide discretion under Rule 22(4), to strike out third party proceedings.

Heindicated at 328 that there were a number of factors that should be considered including: ... What is the fair thing to do? Who suffers prejudice if the discretion is exercised? How much prejudice? Who suffers prejudice if thediscretion is not exercised? How much prejudice? Have the parties acted properly and reasonably in their own interests? If a party hasnot acted properly and reasonably, should he be relieved from the consequences of his own behaviour? Is there another course availableto one or other of the parties? Where does the balance of convenience lie?

This list is illustrative, but not exhaustive, of the questions thatshould be asked with respect to the parties before the court. But part of the purpose of the Rule is to avoid multiplicity of proceedings forthe benefit of other litigants, so that congestion in the courts is avoided. So it is proper to ask questions in that area as well. 42 In Clayton Systems 2001 Ltd. v.

Quizno's Canada Corp., 2003 BCSC 1573 at para. 9 , 27 B.C.L.R. (4th) 247 [Clayton Systems],which was decided under the Amended Rule, Allan J. held that in determining the application the court should consider the followingfactors in determining whether or not to exercise its discretion to grant leave:

(

a) prejudice to the parties; (

b) expiration of limitation period; (

c) the merits of the proposed claim; (

d) any delay in proceedings; and (

e) the timeliness of the application. 43 In Scott Management at para. 90, the court framed the question on an application for leave to file a third notice in this fashion: [90] The fundamental question on the applications should have been whether greater injustice and inconveni

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