The company that owns the former Great West Lumber sawmill site that has seen two major fires in the last six years, has launched a $31-million civil action against the City of Thunder Bay.
Great West Lumber Inc. says the City cut off the water supply to the site, leaving the structures vulnerable to fire, but the City said the water infrastructure on the property was too damaged and dysfunctional to allow for the water supply to be reactivated.
There have been two major fires at the Clavet Street site, with one occurring in June 2015 and most recently on the night of Nov. 8, 2021, which is still under investigation.
The sawmill was idled in 2007 due to an economic downturn in the forestry sector but several pieces of machinery, chattels, and buildings remained on the site, which Great West Lumber, the plaintiff, gave an approximate value of $25 million according to its the statement of claim filed in February 2017.
While the buildings on the site did have an indoor sprinkler system, the company stopped the continuous flow of water to the sawmill in order to reduce costs, however, the on-site fire hydrants and sprinklers remained functional.
In 2010, the City became concerned that the decision to terminate the water service could result in backflow issues and compromise the City’s water quality, so a contingency plan was developed between Great West Lumber, the City, and Thunder Bay Fire Rescue (TBFR).
The plan would see continuous access of the water supply to the on-site hydrants ceasing, but valves on Clavet Street would allow for the immediate resumption of water flow in the case of an emergency.
“Sometime after the parties established this plan, the City unilaterally blocked water access to the above-mentioned valves, entirely unbeknownst to the plaintiff and the TBFR,” the statement of claim reads. “This decision left the sawmill extremely vulnerable to fire damage.”
A fire broke out at the site on the evening of June 17, 2015. The cause remains unknown and while the Office of the Fire Marshall has completed its investigation, the results have not been released because the Thunder Bay Police Service has not yet concluded its investigation. According to the statement of claim, it became clear that the water source had been shut off by the City, making the hydrants and sprinklers inoperable.
“TBFR crews were forced to relocate a pumper truck to the Lake Superior shoreline in order to have a water source to fight the fire,” the statement of claim reads. “During the time that the TBFR was trying to establish a reliable source of water and due to the sprinkler system having no water flow, the fire advanced beyond control.”
The fire burned for approximately two days with the sawmill being completely destroyed, along with the machinery and several out-buildings.
The plaintiff alleges the actions of the City were negligent and in breach of its legal duties to provide a municipal source of water for fire prevention efforts.
“It is submitted that had the city properly met the requisite standard of care in the circumstances, the plaintiff and the TBFR would have successfully caused the municipal water flow to resume very soon after the fire began, permitting effective fire suppression efforts,” the statement of claim reads.
The statement of claim goes on to say that the city intentionally or negligently misrepresented what access to the municipal water supply would be available in the case of a fire and was in breach of its agreement with the plaintiff by terminating the supply without notice.
The company is seeking $25 million in general damages, $5 million for lost profits, $1 million for punitive damages, and $100,000 in special damages. The City of Thunder Bay denies all allegations, which it details in a statement of defense filed in June 2017.
According to the City, the site had a fire suppression system that included a sprinkler system in some of the buildings as well as seven private hydrants, owned and operated by the plaintiff.
“At all materials times, the Fire Suppression system was in total disrepair and inadequate to respond to any type of fire event, including the Fire Loss,” the statement of defense reads.
The City said because the water infrastructure was terminated by the company in an effort to save costs, which included a portion of the fire suppression system, the City disconnected and capped the water infrastructure in order to prevent back flow and contamination of the municipal water supply. This included four of the seven private hydrants on the property.
The City says it had discussions with the plaintiff if it wished to reactivate these hydrants at some point in the future, but the plaintiff said it was not prepared to incur of the costs associated with reactivation.
In December 2012, the plaintiff informed the City that the water infrastructure on the property was leaking and water was pouring from the water lines of the sawmill onto the property. The City then terminated, but did not cap, the two remaining water feeds to the sawmill.
“At all materials times the plaintiff knew, or ought to have known, that in order for the City to be able to reconnect and reactive a water service between the City water infrastructure and the Great West Lumber water infrastructure, including the fire suppression system, significant upgrading, repairs, and remediation to these privately owned infrastructures would be necessary,” the City’s statement of defense reads.
The City goes on to say that between December 2012 and the June 2015 fire, the plaintiff made no repairs to the water infrastructure or fire suppression system on the property to allow the City water system to be reconnected or reactivated safely.
There were also no requests on the part of the plaintiff to reconnect the water supply and on the evening of the fire, the City advised the plaintiff that it would not be possible to reconnect the city water supply because of the compromised fire suppression system and damaged water infrastructure on the site that had not been repaired.
As such, any contingency plans to address a fire were based on the water infrastructure that existed on the site before 2010, the City argues.
“The plaintiff knew that any such contingency plans were based upon the existence of a fully functional Great West Lumber water infrastructure and fire suppression system, neither of which were in place at the time of the fire loss,” the statement of defense reads.
The City goes on to say that even if the water could have been reconnected safely and legally, which it says it could not have, the available source of water would not have been able to assist in extinguishing the fire, as it was already out of control.
First responders were also hindered by a welded gate, impeding access to the property, the City alleges, adding that water was drawn from Lake Superior as an initial source by two pumper units, which was a better source than the water infrastructure.
“The City specifically denies that the fire suppression efforts of the City’s firefighters were in any material way hindered by the fact that the city water infrastructure was not reconnected and/or reactivated to the Great West Lumber water infrastructure and fire suppression system,” the statement of defense reads, adding that any damages incurred by the plaintiff “were not caused by fault, neglect, intentional misrepresentation, deceit, breach of agreement, negligence, or breach of duty on the part of the City.”
The statement of defense goes on to argue that the value of the property loss is not $25 million and the plaintiff has not accounted for the diminution of the assets through the passage of time.
Furthermore, because there were no meaningful future plans for the sawmill, it cannot be argued that any future profits were lost.
The City goes on to allege that the plaintiff was negligent for not properly securing the property and thereby allowing vagrants, vandals, and others to access the sawmill.
The plaintiff denies the allegation that the water infrastructure was damaged or dysfunctional in a reply filed in September 2017, as well as denying that the city advised or warned that the water could not be reconnected, that the gate was welded shut, and said reasonable security measures were in place.
None of the allegations have been tested in court.
– Thunder Bay Newswatch
