Executive Summary: Key Legal and Evidentiary Issues

• Whether Paladin Security Group Ltd. should be added as a defendant based on negligence allegations.
   
• The plaintiffs sought to add a new cause of action under the rule in Rylands v. Fletcher after the normal limitation period had arguably passed.
   
• Discoverability under the Limitation Act turned on when the plaintiffs received an RCMP investigation file identifying the cause of the explosion.
   
• Removing discontinued defendants from the style of cause raised questions about an unresolved third-party costs issue.
   
• Non-natural use of land remained central to whether the strict liability rule in Rylands v. Fletcher could apply.
   
• Costs were sought in the cause for a substantially successful chambers application.
   

Facts of the case

1075459 B.C. Ltd. owns land at 1192 5th Avenue in Prince George, and Encore Promotions Inc. leases that land and operates a nightclub on it. Commonwealth Campus Corporation owns an adjacent building at 422 Dominion Street. On August 22, 2023, that building was destroyed by an explosion after unauthorized persons broke a gas pipe on the premises, causing natural gas to accumulate. The explosion damaged the plaintiffs' premises and forced Encore Promotions to cease operations while repairs were carried out. Paladin Security Group Ltd. had been hired by Commonwealth to provide security for the building at the time of the explosion. The plaintiffs filed their Notice of Civil Claim on January 17, 2024, later amending it and eventually discontinuing their claims against the City of Prince George and Four Star Communications Inc. in May 2025. By notice of application filed March 24, 2026, the plaintiffs sought leave to further amend their pleadings, add Paladin as a defendant, and remove the City of Prince George, Four Star Communications Inc., and John Doe from the style of cause.

Policy and legislative provisions at issue

Section 8 of the Limitation Act, S.B.C. 2012, c. 13, sets out when a claim is "discovered," requiring that the claimant knew or ought to have known that injury occurred, that it was caused by an act or omission, that the act or omission was attributable to the person being sued, and that a court proceeding would be an appropriate remedy. Section 6 of the same Act establishes the standard two-year limitation period, which Commonwealth argued had expired before the proposed Rylands v. Fletcher amendment was brought. The rule in Rylands v. Fletcher (1868), L.R. 3 H.L. 330, imposes strict liability where a defendant makes a "non-natural use" of their land, a concept the parties disputed applied to the vacant building.

Reasoning and analysis

Justice Tindale found that the evidence, including a Security Inspection Report and a contract between Paladin and Commonwealth attached to Trevor Sakamoto's affidavit, established a factual basis to proceed against Paladin in negligence, and granted leave to add Paladin as a defendant; neither Commonwealth nor Paladin opposed this aspect of the application. On the Rylands v. Fletcher amendment, both parties agreed it raised a new cause of action, and the court applied the test from Eastern Platinum Limited v. Cameron, 2020 BCSC 1353, asking whether it would be just and convenient to allow the amendment assuming the limitation period had expired. Drawing on Smith v. Inco Ltd., 2011 ONCA 628, which described non-natural use as "a user inappropriate to the place," the court rejected Commonwealth's argument that the proposed pleadings showed a natural use of the building, finding the amendments pleaded sufficient facts to leave that issue for trial. Given the dispute over when the plaintiffs discovered the cause of action, the court held it would be inappropriate to resolve the limitation question summarily and allowed the amendment without prejudice to Commonwealth raising the limitation defence at trial. On the style of cause, the court declined to remove the City of Prince George because the related third-party proceeding, including its costs, remained unresolved, but ordered Four Star Communications Inc. and John Doe removed since neither had been parties to that third-party proceeding. The court also relieved the plaintiffs of any obligation to serve the Further Amended Notice of Civil Claim on the City or Four Star, given the discontinuance against them.

Ruling and overall outcome

The court granted the plaintiffs leave to add Paladin as a defendant, allowed the proposed amendments regarding the rule in Rylands v. Fletcher without prejudice to Commonwealth's limitation defence at trial, ordered Four Star Communications Inc. and John Doe removed from the style of cause, but dismissed the application to remove the City of Prince George and the related third-party proceedings. The plaintiffs, found substantially successful on the application, were awarded their costs in the cause; the judgment does not specify a dollar amount for those costs.