Wayne Hatala of Prefco was majority owner of restaurant and marina labelled crime hot spot

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Ex-crime hot spot sold in Harrison
Man acquitted of laundering money buys restaurant, marina
Kim Bolan
Vancouver Sun

The Breakwater restaurant on Harrison Lake was previously run by Daryl Giles Desjardins, now serving a 41/2-year sentence for marijuana trafficking and a weapons violation.
CREDIT: Peter Battistoni/Vancouver Sun
The Breakwater restaurant on Harrison Lake was previously run by Daryl Giles Desjardins, now serving a 41/2-year sentence for marijuana trafficking and a weapons violation.

A Harrison Lake marina and restaurant at the centre of a cross-border drug smuggling operation has been sold to a controversial businessman who was arrested with former Vancouver lawyer and convicted money-launderer Martin Chambers.

Jack Purdy and his Armac Investments Ltd. took official possession of the Breakwater Restaurant and Marina, near the Village of Harrison Hot Springs, on Oct. 11, according to property transfer records obtained by The Vancouver Sun.

Purdy faced a series of U.S. money-laundering charges, along with Chambers, after a joint FBI-RCMP investigation culminated in their arrests in 2002.

Chambers was convicted and sentenced to 15 years in a U.S. jail, while Purdy was acquitted by a jury on the money-laundering charges. He later pleaded guilty to a financial reporting offence.

Purdy owns millions of dollars of resort properties on Vancouver Island, in Hawaii, the Caribbean and in Italy, according to court documents.

He bought the Breakwater for $1.4 million after the previous owners were foreclosed upon.

Purdy could not be reached for comment this week. His lawyer Gerry Mazzei, whose office is listed in corporate records as the address of Armac, said Purdy bought the property so he could develop it as he has done with similar sites.

"I let him know that you were calling and he said, 'You can just tell them I bought this at a court-ordered sale. I don't know the previous owner. I am in this kind of business.' It is just business as usual for him," Mazzei said.

"I expect he's got plans to revive it and make it operational."

He said Purdy lives primarily in Alberta now and was not aware of the police investigation that focused on the restaurant and marina and helicopter drug smuggling earlier this year.

That investigation led to the arrest last May of Daryl Giles Desjardins, the last man to run the once-popular Breakwater restaurant.

Police said at the time that the restaurant, with its scenic lakeside location, was a hot spot for organized crime groups ranging from bikers to Asian and Indo-Canadian drug gangs. They said Desjardins, a 44-year-old with a penchant for fast, luxury cars, contracted out his services to move large quantities of pot across the U.S. border.

Even before the land sale was official last Wednesday, Purdy had been introducing himself to officials in both the village of Harrison Hot Springs and the District of Kent. The Breakwater is in Kent, but visitors to the scenic spot must go through the nearby village.

Harrison Mayor Leo Facio confirmed Thursday that Purdy attended a Sept. 28 village community plan meeting with an associate.

"It was the end of the evening and he just sort of introduced himself," Facio said of Purdy. "He just happened to mention he had some interest in the Breakwater."

Facio said Purdy had some discussions with village planners, but the mayor was not involved in those talks.

Larry Burk, Kent's director of development, said Purdy and two associates also paid a visit in mid-September.

"He just gave us some of his ideas," Burk said, adding that nothing has been formally proposed for the site. "They were just talking about logistics."

The restaurant remains closed and there is no business currently operating there, Burk said.

"There is not much that place does except give us some notoriety," he said.

Desjardins, who parked his Bell JetRanger helicopter in a tin shed on the site, pleaded guilty in August to two marijuana-trafficking charges and to violating a weapons ban. He is now serving a 41/2-year sentence.

He admitted in court to flying the chopper across the border and landing near Loomis, in Washington state, with 155 kilograms of marijuana worth $1.2 million stuffed into hockey bags.

When police searched Desjardins' house in nearby Popkum, they found two sets of ballistic armour and eight firearms, including two assault-style rifles and four handguns, some of which were loaded. Police also found $21,000 in cash and a Glock handgun, with its serial numbers removed, inside one of Desjardins' vehicles.

The sentencing judge said Desjardins was "the organizational facilitator in a drug-distribution chain."

"This incident was a well-planned and carefully coordinated scheme that involved a multitude of other individuals, both in Canada and the United States, for the pickup, delivery and distribution of drugs. The defendant was not a mere courier hired for the specific purpose of delivering marijuana," Chilliwack Provincial Court Judge Brent Hoy said. "The defendant was involved in a large-scale commercial operation in the distribution of marijuana, with economic gain as the driving force for his participation."

Desjardins also had been ordered by the U.S. District Court a year ago to pay more than $5 million US for his role in a fraudulent scheme to sell the stock of Pay Pop Inc., a now-defunct telecommunications company that was based in B.C.

Desjardins, who acted as Pay Pop's president, worked with controversial Vernon stock promoter Robert Zaba, in what the U.S. Securities Exchange Commission alleged was a classic "pump-and-dump" scheme that earned them millions as they put out false news releases about the company's assets.

SEC documents also say Desjardins "even boasted that Pay Pop was his own 'printing press' for money, while at the same time bartering Pay Pop stock for several exotic cars and an ownership interest in a thoroughbred racehorse."

During the Pay Pop probe, the RCMP said the company was linked to the Hells Angels.

Property records show the Breakwater Restaurant was owned by the Harrison Lake Marina Corp., which had run into financial trouble, and that Desjardins had put in a bid to buy the restaurant before his arrest, according to a court case filed against it.

Instead, a B.C. Supreme Court order dated June 28, 2006 approved the sale of the site to Armac and its sole director, Purdy, with a closing date of Aug. 30. Purdy's mortgage for the property was registered on Sept. 29 with many of the same Calgary-based investors who were previously involved.

"It is a public record and it is coming out of Calgary and they are the people who foreclosed and they are providing the financing in the present transaction," Mazzei said.

Purdy's latest land acquisition was made days after he and Armac were sued by his former common-law spouse, Kim Galavan, in B.C. Supreme Court.

Galavan's statement of claim, filed Sept. 18, alleges Purdy did not live up to an agreement to compensate her for the contributions she made to the acquiring, renovating and managing of several properties in B.C., Hawaii, Italy and Anguilla in the Caribbean, during their eight-year relationship.

The businesswoman says in the court papers that she helped preserve Purdy's business interests while he was facing charges in the U.S. and arranged for his bail and "provided US $50,000 from her bank account for the initial legal fees."

The documents allege Purdy agreed to buy Galavan a house in May 2004, but later reneged on a commitment to cover the cost of the renovations and mortgage, as well as breached an agreement to compensate her for her interest in several of Purdy's properties.

Purdy has yet to file a statement of defence in the suit.

Chambers, Purdy and three other B.C. men were drawn into an FBI-RCMP money-laundering and stock sting operation codenamed Bermuda Short in August 2002. Disguised as financial front men for a Colombian drug cartel, undercover officers tried to induce them to launder hundreds of thousands of dollars of cash, which they represented as the proceeds of drug trafficking.

On Aug. 14 and 15, 2002, all five men were arrested on U.S. soil and charged with money-laundering offences.

Two pleaded guilty and agreed to cooperate with federal prosecutors. Chambers fought the charges against him, but was convicted on all five counts by a Miami jury in the fall of 2003.

Purdy, a longtime stock promoter, pleaded not guilty and was forced to stay in Miami wearing an electronic monitor until he was eventually acquitted and returned to Vancouver.


© The Vancouver Sun 2006

Copyright © 2007 CanWest Interactive, a division of CanWest MediaWorks Publications, Inc.. All rights reserved.

KPMG alleges fraud in deal involving leaky condo repair company Prefco and Harrison Lake Marina


 This case will be of particular interest to leaky condo owners whose strata corporations contracted with one of the Preferred companies before and after the collapse of New Home Warranty.





KPMG et al v. Harrison Lake Marina Corporation,


2006 BCSC 143

Date: 20060127
Docket: S045361
Registry: Vancouver


KPMG Inc. in its capacity as Trustee of Prefco Enterprises Inc.
and Coast Flashing and Scaffolding Inc., P.C.G. Construction Group Inc.,
and Preferred Restoration & Emergency Services Inc.



Harrison Lake Marina Corporation


- and -

Docket: H040947
Registry: Vancouver


Kozul Holdings Inc.



Harrison Lake Marina Corporation, KPMG Inc., in its capacity as trustee in
bankruptcy of Prefco Enterprises Inc., Prefco Consultants Inc., Wayne Hatala,
Mike Blake, B. Ford Pharmacy Ltd., Chizen Farms Ltd., Crestmount Holdings Ltd.,
Greentree Mortgage Corporation, Moonpool Capital Corporation, Richard Connors,
Joanne Gerl, Werner Gerl, Esther Hauck, James Masleck, Suzanne Seliga,
Jenifer Gray, Olympia Trust Company, Canadian Western Trust Company,
Richard Frank Simon d.b.a. Harrison Landscaping


Before: The Honourable Madam Justice Martinson

Reasons for Judgment

Counsel for KPMG

J. Grieve
K. Robertson

Counsel for Harrison Lake Marina Corporation

F. Eadie

Counsel for the First Mortgagee

J. Goheen

Counsel for the Second Mortgagees

D. Nugent

Date and Place of Hearing:

January 9 and 19, 2006


Vancouver, B.C.


[1]                There are two proceedings involving several applications before the Court. 

[2]                The first proceeding is a fraudulent conveyance action by KPMG, in its capacity as trustee in bankruptcy for a group of companies (the “Prefco Group”), against the Harrison Lake Marina Corporation (“HLMC”).  The action relates to the payment of over one million dollars by the Prefco Group to HLMC while the Prefco Group was insolvent.  KPMG, in its statement of claim, asks for repayment of the funds and relies on the Fraudulent Preference Act, R.S.B.C. 1996, c. 164, the Fraudulent Conveyance Act, R.S.B.C. 1996, c. 163, the Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, and the Land Title Act, R.S.B.C. 1996, c. 250.  The action is scheduled for trial on May 15, 2006.  In relation to this action, KPMG registered a certificate of pending litigation (“CPL”) against the titles to HLMC’s lands and water lot leases (the “Property”). 

[3]                The second proceeding is a foreclosure petition by Kozul Holdings Inc., the first mortgagee of the Property (the “First Mortgagee”).  The First Mortgagee was granted an Order Nisi in May 2005 (the “Order Nisi”) and the redemption period has expired. 

[4]                In the applications before this Court: HLMC was seeking cancellation of the CPL so that it could complete a sale of its shares; KPMG was seeking conduct of sale of the Property (the First Mortgagee supported this application); and, a group of companies and individuals who are respondents to the foreclosure petition and second mortgagees of the Property (the “Second Mortgagees”) were seeking a six month extension of the redemption period of the Order Nisi and conduct of sale of the Property (HLMC supported this application).

[5]                At the initial hearing of the CPL application on January 9, 2006, this Court had to consider whether the proposed sale of HLMC’s shares was provident.  It was advised that the only available appraisal of the Property was prepared at the request of HLMC by Cunningham & Rivard Appraisals (Vancouver) Ltd. on January 12, 2004 (the “Initial Appraisal”).  The appraised value as at that date was $1,750,000 - significantly higher than the value of the proposed share sale.  HLMC argued that this appraisal was entitled to little weight.  This Court reserved its decision and intended to give oral reasons for judgment on the CPL application on January 19, 2006.  On that morning, counsel for KPMG asked permission to present evidence of an updated appraisal that had been prepared by Cunningham & Rivard Appraisals (Vancouver) Ltd. for HLMC before the initial hearing, but which had not been presented by it at the hearing.  This Court considered that new evidence and gave its decision dismissing the application to remove the CPL and granting KPMG conduct of sale.  These are the reasons for those decisions. 



New Westminster, Carnarvon Towers: Built in 1994-1995; condo owners noticed leaks in October 1996; defects had given rise to a dangerous condition by September 1998; legal action commenced December 23, 1999; court excludes developers Stoneman and Muller in their personal capacity



The Owners Strata Plan LMS 2262 v. Stoneman Developments Ltd. et al.,


2004 BCSC 828

Date: 20040623
Docket: C996826
Registry: Vancouver


The Owners, Strata Plan LMS 2262



Stoneman Developments Ltd., Bayou Developments Ltd.,
S & B Developments Ltd., James Hancock Architects Inc.,
Eric Pattison, Read Jones Christoffersen Ltd., Diana Klein, R.A. Mossakowski,
Sterling, Cooper & Associates Ltd., Myles Sterling,
Dec Design Mechanical Consultants Ltd., Alliance Roofing Systems Ltd.,
Eltex Enterprises (1990) Ltd., Preswitt Manufacturing Ltd., Cryovac Canada, Inc.,
City of New Westminster, Steven Moskalyk, Intertec Testing Services NA Ltd.,
Clan Glass & Metals Ltd., Preferred Restoration & Emergency Services Inc.,
and B.C. Building Science & Engineering Ltd.



Stoneman Developments Ltd., Bayou Developments Ltd.,
James Hancock Architects Inc., Eric Pattison,
Read Jones Christoffersen Ltd., Diana Dlein,
R.A. Mossakowski, Sterling, Cooper & Associates Ltd.,
Myles Sterling, Steven Moskalyk
and Intertek Testing Services NA Ltd.

Third Parties


Stoneman Developments Ltd., Wade Stoneman
and Bayou Developments Ltd.

Third Parties


Belgrove Construction Ltd.,
Inter-Coast Consultants Ltd. and McArthur Vantell Limited

Third Parties

Before: The Honourable Madam Justice Garson

Reasons for Judgment

Counsel for the plaintiffs

J.G. Mendes and

V. Critchley


Counsel for the defendants Bayou Developments Ltd. and Arnold Muller


J.J. Campbell


Counsel for the defendants James Hancock Architects Inc. and James Hancock


G. Miller


Counsel for the defendants Stoneman Developments Ltd. and Wade Stoneman


T. Peters


Counsel for the defendants McArthur Vantell Limited


S. Dumont


Counsel for the defendant Preferred Restoration & Emergency Services Inc.


M. Worfolk


The defendant Rudolf Kevesdi appearing in person for himself and R.K. Engineering Ltd. 



Date and Place of Hearing:

May 10-11, and May 25, 2004


Vancouver, B.C.


[1]            The applications before the court are to add several corporations and individuals as defendants in this action concerning alleged defective construction of a condominium.  The applications are opposed by some respondents on various grounds, including delay, prejudice, and a lack of evidence of an arguable case. 

[2]            The following individuals and companies are proposed defendants in this action:

(a)   Ericson Window Corporation;

(b)   Ericson Glass Industries Ltd.;

(c)   McArthur Vantell Limited;

(d)   Rudolf Kevesdi;

(e)   R.K. Engineering Ltd.;

(f)   Avalar Caulking Services Ltd.;

(g)   Wade Stoneman;

(h)   Arnold Muller;

(i)   All-Span Engineering and Construction Ltd.;

(j)   Key Glass & Aluminum Ltd.; and

(k)   James Hancock;

(collectively, the “Proposed Defendants”).

[3]            The plaintiffs also apply for an order that the style of proceeding, the further amended writ of summons and fourth further amended statement of claim be amended in accordance with the proposed draft amendments. 

[4]            The following parties were served with the applications to add them as defendants but have not filed any response and did not appear at the hearing: 

(a)   Ericson Window Corporation;

(b)   Ericson Glass Industries Ltd.;

(c)   Avalar Caulking Services Ltd.;

(d)   All-Span Engineering and Construction Ltd.; and

(e)   Key Glass & Aluminum Ltd. 

[5]            In order to add a defendant, the applicant plaintiffs must establish that there exists between the proposed party and the original party a question or issue relating to or connected with the relief claimed in the action or with the subject matter of the action and that there is a real question or issue to be tried in the sense that it is not entirely frivolous.  The plaintiffs must also establish that there is a good and sufficient reason for any delay in adding these defendants. 

[6]            There is evidence that Ericson Window Corporation and Ericson Glass Industries Ltd. were the suppliers of windows and doors to the condominium and that water leaked through the windows and doors, requiring repair and replacement. 

[7]            There is evidence that All-Span Engineering and Construction Ltd. was retained by the developers to design and conduct field reviews of the condominium steel stud framing, which studding is now alleged to be defective. 

[8]            There is evidence that Key Glass & Aluminum Ltd. was retained by the defendant, Preferred Restoration, to undertake repair work to the windows.  There is evidence that the repair work was defective and increased the damage to the condominium.

[9]            I am satisfied on the evidence that: there exists, as between the plaintiffs and these proposed defendants, issues connected to the relief claimed in the original action, there has not been inexcusable delay in seeking to add these defendants, and it is just and convenient to add these defendants, pursuant to Rule 15(5)(a)(iii).

[10]        I therefore order that the defendants Ericson Window Corporation, Ericson Glass Industries Ltd., Avalar Caulking Services Ltd., All-Span Engineering and Construction Ltd., and Key Glass & Aluminum Ltd. be added as defendants and the pleadings be amended in accordance with Schedule A to the notices of motion dated June 6, 2003, October 31, 2003, and April 29, 2004. 

[11]        The application to add the defendant James Hancock was consented to. 

[12]        The remaining Proposed Defendants oppose the applications to add them as defendants.  These defendants have the following general involvement with the condominium development that is the subject matter of this action. 

[13]        McArthur Vantell Limited ("McArthur Vantell") was retained as a consultant by Preferred Restoration & Emergency Services Inc. ("Preferred Restoration"), who were initially retained by the developer to remedy what was then considered to be a problem of some leaking windows.  It is alleged that McArthur Vantell failed to ensure that the remedial work was carried out in a proper manner and/or failed to perform adequate inspection of the remedial work. 

[14]        The allegation against Rudolf Kevesdi and R.K. Engineering Ltd. is that R.K. Engineering was retained as a window structural engineer and that it owed a duty to exercise reasonable care in reviewing and approving the structure and design of the windows and sliding doors used in construction of the condominium.  There is evidence that water ingressed through the windows and sliding doors and it is alleged that there are structural problems with the windows, which caused or contributed to the leakage. 

[15]        The allegations against Arnold Muller and Wade Stoneman are that they acted as project managers in respect of the construction of the condominium and participated in and supervised the design, development and construction of the condominium.  As well, it is alleged that the disclosure statement contained misrepresentations for which Stoneman and Muller are liable under s. 75 of the Real Estate Act, R.S.B.C. 1996, c. 397. 

[16]        I turn to a consideration of the applications which are defended by the Proposed Defendants.  But before doing so, I will briefly outline the facts which form the background to this action. 


[17]        The members of the plaintiff Strata Plan (collectively known as the “Owners”) are owners of the strata lots in the condominium development known as Carnarvon Towers, located at 720 Carnarvon Street in New Westminster (the “Condominium”).  The strata plan is composed of 87 strata lots (80 residential units and 7 commercial lots). 

[18]        The Condominium was built during 1994 and 1995.  The first date of possession as noted in the New Home Warranty Program (“NHW”) Special Project Possession Certificates was December 28, 1995.  (The last owner of a residential unit took possession on November 3, 1998). 

[19]        The developer of the Condominium was S & B Developments Ltd., a joint venture between Stoneman Developments Ltd. and Bayou Developments Ltd. (the “Developers”). 

[20]        Water ingress problems were first noted by the Owners in or about October 1996.

[21]        When the water ingress problems were first noted by the Owners, the Developers obtained a Moisture Ingress Investigation Report from McArthur Vantell dated December 4, 1996.  The Condominium was covered by the warranty made available to purchasers through the NHW.  The Developers subsequently advised the Owners that they would honour the warranty. 

[22]        The Developers retained Preferred Restoration and McArthur Vantell to undertake and oversee the repairs thought necessary in 1997. 

[23]        In about December 1996 the plaintiffs received legal advice suggesting that they should independently investigate the water ingress problems.  The plaintiffs subsequently received an Exterior Envelope Preliminary Option report dated March 31, 1997, prepared by Morrison Hershfield Limited. 

[24]        The remedial work undertaken by the Developers was not completed until late 1997 or early 1998.  Ongoing water ingress was experienced.  Consequently, the Owners retained Morrison Hershfield to undertake a building envelope condition assessment.

[25]        A Building Envelope Condition Assessment report dated September 4, 1998 was prepared by Morrison Hershfield Limited.  A summary of this report was given to the Owners in October 1998.  This was the first report which indicated in any way that any of the defects in the Condominium had given rise to a dangerous condition. 

[26]        The plaintiffs retained counsel in October 1999 and commenced this action on December 23, 1999.  The parties included as defendants were those that counsel for the plaintiffs thought might be found liable based on the Building Envelope Assessment report of Morrison Hershfield dated September 4, 1998. 

[27]        The statement of claim was issued on November 15, 2000. 

Principles of Law That Govern This Application

(a)   Statutory Framework

[28]        An application to add a party is governed by Rule 15(5)(a)(ii), which reads as follows: 

(a)   At any stage of a proceeding, the court on application by any person may …

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

(A)   with any relief claimed in the proceeding, or

(B)   with the subject matter of the proceeding,

which in the opinion of the court it would be just and convenient to determine as between the person and that party. 

[29]        Where as here, it is alleged that a limitation period has expired, the application is also governed by s. 4(1)(d) of the Limitation Act, R.S.B.C. 1996, c. 266, which provides:

s. 4(1)     If an action to which this or any or act applies has been commenced, the lapse of time limited for bringing an action is no bar to …

(d)   adding or substituting a new party as plaintiff or defendant,

under any applicable law, with respect to any claims relating to or connected with the subject matter of the original action. 

[30]        The inter-relationship between these two statutory provisions has been the subject of much judicial commentary.  Here, it is alleged by the Proposed Defendants, that the applicable limitation period expired after the issuance of the writ and prior to the filing of this application to add the Proposed Defendants. 

[31]        The following principles emerge from the authorities which govern this application. 

[32]        First, the plaintiffs must establish a degree of connection between the cause of action in the existing writ and statement of claim and the cause of action against the Proposed Defendants and that there is a real question or issue to be tried as between the plaintiffs and the Proposed Defendants.  

[33]        Second, the plaintiffs must establish that it is just and convenient to add the Proposed Defendants.

[34]        The determination of what is just and convenient where it is alleged there is an accrued limitation defence includes considerations of the extent of the delay, the reasons for the delay, any explanation put forward to account for the delay, prejudice in defending the action caused by the delay, as well as the extent of the connection between the existing claims and proposed new causes of action (Letvad v. Fenwick (2000), 82 B.C.L.R. (3d) 296 (C.A.) and Teal Cedar Products (1977) Ltd. v. Dale Intermediaries Ltd. et al. (1996), 19 B.C.L.R. (3d) 282 (C.A.)). 

[35]        In Brito v. Wooley (1997), 15 C.P.C. (4th) 255 (B.C.S.C.), Master Joyce (as he then was) conveniently summarized the principles that govern the determination of what is just and convenient where it is alleged that a limitation period has expired.  At ¶ 10, 11 and 12 he said:

I will begin my analysis with a summary of the applicable legal principles: 

1.    The addition of a party to an action under Rule 15(5) eliminates any limitation defence which might otherwise be available to the defendant if separate proceedings were brought:  see Lui v. West Granville Manor Ltd. et al. (1987) 11 B.C.L.R. (2d) 273 (C.A.) (“Lui No. 2”) at 295;

2.    The court may add a new party to an action notwithstanding that its effect will be to eliminate a limitation defence if it is just and convenient in all the circumstances to do so.  The existence of a limitation defence is a factor for the court to consider in determining whether it is just to add a party but is not determinative:  see Lui No. 2, supra, at 302; 

3.    The degree of interrelationship between the claim that is sought to be brought through the addition of the party and the existing claim is a factor to be considered as is the delay in making the application and any reasons which are advanced to explain the delay:  see Cementation Co. (Can) Ltd. v. Amer. Home Assur. Co. (1989), 37 B.C.L.R. (2d) 172 (C.A.); 

4.    If a limitation period has expired, then it may be that prejudice to the defendant is to be presumed.  However, prejudice to the defendant, whether presumed or demonstrated, is only a factor; it is not necessarily fatal to the application.  In the end, the court has a broad discretion to do what is just; see Teal Cedar Products (1977) Ltd. v. Dale Intermediarries Ltd., (1996) 19 B.C.L.R. (3d) 272 (C.A.) per Finch J.A.  In Tri-Line Expressways v. Ansari (1997), 143 D.L.R. (4th) 100 (B.C.C.A.) Lambert J.A. said that any presumption of prejudice (which was first mentioned in Lui v. West Granville Manor Ltd. (1985), 61 B.C.L.R. 315 (C.A.) (“Lui No. 1”) “should be confined to the sort of context in which it was first mentioned, namely the context of third party proceedings against a new party on an entirely new cause of action”. 

In my view, the proper approach to applications such as this is as follows: 

3.    If the defendant alleges that there is an accrued limitation defence and the plaintiff denies that fact and the court cannot determine that issue on the interlocutory application, then the court should proceed by asking this question:  assuming that there is a limitation defence, would it nonetheless be just and convenient to add the party even though by doing so the defence is taken away?  If the answer to that question is yes then the order should be made. In that event it does not matter whether or not, in fact, a limitation period has expired because in either case it would be just and convenient to add the party and any limitation defence will be gone. 

[Emphasis added.]

If the conclusion is that, assuming a limitation defence has accrued, it would not be just and convenient to deny the defendant the benefit of that defence, then the order should not be made. 

[36]        In this case, all the Proposed Defendants who contested the application allege that there is an accrued limitation defence.  The plaintiffs deny this fact and I cannot determine the issue on this interlocutory application.  I shall therefore proceed on the basis that there is a limitation defence available in each case and I will consider the factors mentioned above. 

[37]        The length of the delay is one of the factors to be considered, although even an extraordinary length of delay is not necessarily determinative of the outcome (Yablonski v. Cranbrook, 2002 BCSC 1875).  The reasons in Teal, however, do not indicate how the length of delay is to be determined.  The plaintiffs and the Proposed Defendants advance different approaches for measuring the length of delay.  

[38]        Plaintiffs’ counsel contends that the significant period is the delay that accumulates beyond the expiry of the limitation period, plus one year for service.  

[39]        The Proposed Defendants, on the other hand, maintain that the relevant period is the lapse of time beginning upon the plaintiffs' acquisition of facts upon which it would have been reasonable to commence an action against the Proposed Defendants, which in this case appears to have occurred before the expiry of the limitation period. 

[40]        The cases submitted by the parties indicate that both approaches have been used in recent Supreme Court decisions.  Therefore it is difficult to determine whether one method is to be preferred over the other.  In my view, however, it would be inappropriate to adhere rigidly to either one of these methods of calculating the delay, given the discretionary nature of the Court’s power to allow addition of parties and the holistic approach to joinder advocated in Teal

[41]        In Teal Finch J.A. held at ¶ 41 that:

. . . neither the defendant’s interest in being secure against claims after a limitation period had expired, nor the plaintiff’s deliberate dilatory conduct in applying to add parties, are decisive of whether the application should be allowed. Both considerations may be important factors, but neither would prevent the court from exercising its discretion in the plaintiff’s favour.

[42]        For the Court to constrain its consideration of delay by exclusively relying on one of the methods of measuring delay advocated by the parties would be contrary to the guidelines set in Teal.

[43]        To focus only on delay that occurred after the limitation period and the period for service would place emphasis on the prejudice caused to the defendants’ interest in not being vulnerable to claims that are out of time.  According to this approach, delay before the limitation period expired would not feature in the court’s reasoning, despite the potential impact that this delay might have on the justness and convenience of adding the party in question.  Similarly, to measure delay exclusively from the date at which the plaintiffs learned the facts upon which it could have reasonably launched an action necessarily focuses the court’s attention on the plaintiffs’ fault or lack of fault in delaying its claim.

[44]        An approach that would more closely conform to the guidelines set in Teal would be to look at the entire delay, and consider factors such as the circumstances surrounding the delay, the expiry of the limitation period, and the prejudice to the parties when determining whether in the circumstances of the particular case it would be just and convenient to add the proposed defendant, despite the delay.  As dictated by Teal, none of these factors should be considered as having overriding importance, absent a clear evidentiary basis for doing so (¶ 45).  

[45]        I now turn to each of the applications before me with the aforementioned legal principles in mind.