Background:
Pacific Bioenergy Corporation, a wood pellet manufacturer, sued AG Growth International Inc. and its related entities for negligence after a silo collapse at Fibreco Export Inc.’s terminal in North Vancouver. The collapse disrupted terminal operations, causing Pacific Bioenergy financial losses. The defendants had designed and supplied the silos as part of terminal upgrades.

Legal Issues:
The case centered on pure economic loss and whether the defendants owed a duty of care to Pacific Bioenergy. The plaintiff argued that the defendants were negligent in designing the silos and failed to warn users of prior failures. The defendants sought to strike the claim, asserting there was no proximate relationship or legally cognizable right justifying recovery.

Judgment & Rationale:
The Honourable Justice Giaschi ruled in favor of the defendants, striking the claim. He found that the plaintiff’s loss was pure economic loss, which is generally not recoverable in tort unless falling into recognized exceptions. The plaintiff lacked a proprietary interest in the damaged property, a contractual relationship with the defendants, or any direct reliance on their expertise. The judge also cited indeterminate liability concerns, as multiple parties could have potentially claimed losses.

Outcome & Costs:
The appeal was allowed, the plaintiff’s claim was struck, and the parties were given leave to address costs separately. The total amount of damages sought was $2.6 million, but no award was granted to the plaintiff.