Fiddler Enterprises Ltd. v. Allied Shipbuilders Ltd., 2003 FCT 463

Date: 20030417

Docket: T-842-99

Neutral citation: 2003 FCT 463

Ottawa, Ontario, this 17th day of April, 2003

PRESENT:      The Honourable Madam Justice Heneghan

BETWEEN:                                                             

                                                    FIDDLER ENTERPRISES LTD.,

                                                           DRAGON FISHING LTD.,

                                                         FIDDLER BUILDING LTD.,

                                                        DAVID NORMAN FIDDLER,

                                                         JAMES DONALD FIDDLER

and

MARK STEPHEN

                                                                                                                                                        Plaintiffs

                                                                                 and

                                                       ALLIED SHIPBUILDERS LTD.

                                                                                                                                                      Defendant

                                               REASONS FOR ORDER AND ORDER

HENEGHAN J.

INTRODUCTION

[1]                 On September 22, 1997, a fire occurred on board the fishing vessel "KNIGHT DRAGON" while she was en route from the fishing grounds off San Juan Island to Port Angeles, Washington, United States of America. The primary issue arising in this litigation is the cause of the fire.

THE PARTIES

[2]                 Fiddler Enterprises Ltd., Dragon Fishing Ltd., and Fiddler Building Ltd. are incorporated under British Columbia law. The three corporate defendants are the owners of the fishing vessel "KNIGHT DRAGON" and operate the vessel as a joint venture for the purpose of catching fish.

[3]                 Mr. James Fiddler is a qualified fishing master and has been going to sea since the early 1970s. At all material times he was the principal of Dragon Fishing Ltd. At various times, he has served as master, engineer, and deck hand on board the F.V. "KNIGHT DRAGON", as well as on other vessels. On the date of the fire, he was working as a deck hand and member of the fishing crew.

[4]                 Mr. Mark Stephen is also a mariner. He is not a shareholder of any of the corporate plaintiffs. He is related by marriage to Mr. James Fiddler. He has been a crew member, acting as an engineer, on board the F.V. "KNIGHT DRAGON" since September 1995.

[5]                 Mr. David Fiddler, James Fiddler's brother, is a commercial fisherman and at all material times was the principal of Fiddler Enterprises Ltd. He has a Fishing Master III licence and basically acts as the master on the "KNIGHT DRAGON" while on board.

[6]                 Allied Shipbuilders Ltd. is a body corporate incorporated under the laws of British Columbia. It carries on the business of a shipyard and ship repair facility. The Defendant has been in existence for more than fifty years. Its premises are located at 1870 Harbour Rd., North Vancouver, British Colombia. There has been a long relationship between the Defendant and members of the Fiddler family, and the Defendant shipyard provided work and services on other vessels operated by members of the Fiddler family.

BACKGROUND

I)           The layout and parts of the Fishing Vessel "KNIGHT DRAGON"

[7]                 The fishing vessel "KNIGHT DRAGON" was built in Pictou, Nova Scotia in 1980 by Ferguson Shipbuilders Limited. The vessel is of steel construction, with three decks. The engine room is located on the lowest deck. The accommodation or main deck, with cabin for the crew, galley and mess, and work area is the second deck. The top deck contains the wheelhouse and master's cabin which is slightly lower than the wheelhouse and accessible by a short companionway.

[8]                 The net drum for the fishing activity is located on the top deck, as well as certain equipment including a sonar used in certain fishing operations. A funnel cap sits on top of the wheelhouse. The wheelhouse deck is steel and slopes slightly to the aft. The floor of the funnel is part of the wheelhouse deck and is also made of steel, with a slight lip along its outer edge. The floor of the funnel also has a slight slope.

[9]                 The engine room is equipped with a main engine that has two turbo charges, a port auxiliary engine, a starboard auxiliary engine and an Isusu auxiliary generator. The main engine and the port and starboard auxiliary engines are common diesel engines. The Isusu is a general use engine which is diesel fed.

[10]            The port and starboard fuel tanks have stand pipes located in the engine room. These pipes are used to measure the quantity of fuel in the tanks. They have a valve and a screw cap on tight, but neither is air or fluid tight.

[11]            The vent pipes for the port and starboard tanks rise through the vessel and exit on the wheelhouse deck, on the port and starboard sides. These vent pipes end in a goose-neck which contains a ball, a screen and a gag. According to the evidence, the ball sits on the screen unless force, like a wave, pushes it against the opening. It acts as a barrier to prevent water from entering the pipe; it does not fit in the pipe itself.

[12]            Two exhaust pipes rise from the main engine, and an exhaust pipe from each of the three auxiliary engines. The exhaust pipes are attached to silencers, or mufflers, which rise through the engine room casing and funnel, and exit on the upper deck.

[13]            The engine room casing is a trunk-like structure that runs from the ceiling of the engine room up through the interior of the ship to the floor of the funnel. The funnel sits on the highest deck, on the top deck of the ship. The exhaust casing houses the exhaust pipes running from the engine room.

[14]            The exhaust casing begins where the exhaust pipes exit the engine room. Its walls, on the main deck level, are made of steel with the exception of an aluminium panel which provided access to the casing. The outer walls of the exhaust casing were covered with arborite that was attached to vertical wooden studs affixed to the casing wall itself. Insulation blankets were attached to the steel walls of the exhaust casing. The walls of the casing at the wheelhouse level were made of aluminium and were not insulated.

[15]            The silencers, sometimes also called "mufflers", which are at issue in this action are those attached to the exhaust pipes rising from the main engine and the port auxiliary engine. The silencers are attached to the exhaust pipes by means of gaskets and flanges. The lower end of the silencers are attached to raised-face flanges, in other words, there was a raised lip around the outside circumference of the opening to accommodate the top of the exhaust pipes rising from the main engine. The raised flange is characterized by grooves along the top of that inner surface similar to the grooves in a record.

[16]            A gasket is then placed on top of the raised-face flange. Then a flat-faced flange is attached to the bottom end of the silencer and the two flanges and gasket are joined together by nuts and bolts. At its upper end, the silencer is fitted with a flat-faced flange and another gasket is installed. The top end of each muffler is then attached to the lower end of a pipe which rises to an inverted "y" to exit through a single pipe, rising through the top of the funnel and emerging on the outside of the funnel cap, where it is fitted to a short end of pipe, called a stub pipe. A round piece of metal, colloquially known as a "rain hat", is fitted around the pipe and the pipe then rises a further distance to discharge exhaust.

[17]            The top ends of the silencers are joined to pipes of the inverted "y" by a system of flanges and gaskets although the arrangement differs from the arrangement at the lower ends of the silencers. At the top side, the silencers are fitted with a flat-faced flange and a gasket, and this is attached to the lower end of the pipes, each of which is connected with a raised-face flange. Again, the flanges and gaskets are connected by nuts and bolts. The positioning of the gasket against the raised-face flange is critical.

[18]            The contact between the gasket and the raised face of the flange forms a seal, and it is the inner circumference of the gasket which is of utmost importance. The outer circumference of the gasket serves to identify the bolt holes for easy placement of the bolts but otherwise, the outer circumference does not contribute to the sealing process which is required to contain the exhaust gases within the mufflers and exhaust pipes.

[19]            The wrappers are insulating blankets. They are designed to keep heat generated from the exhaust gases from entering the exhaust casing. In this case, the barrels of the exhaust silencers were wrapped with one silencer. The flanges, on top and bottom, were individually wrapped with silencers. The inverted "y" and pipe leading to the exterior of the funnel were also wrapped with the insulating material.

[20]            The wrappers used on the ship were supplied and installed by Alexander Installations. The silencers were wrapped around the exhaust pipes and flanges, and drawn tight by laces that run through the top and bottom.

[21]            The mufflers are wrapped in a fire retardant wrapper known as a "blanket". This covering consists of an outer silvery material which is designed to suppress fire; and interior of off -white padded material covered with a fine stainless steel mesh. The constituent parts of the blanket are stapled together. There are hooks to hold lacings and the blanket is attached to the muffler and the flanges, by being tightly laced. The purpose of these wrappers is to further contain exhaust gases within a confined area.

[22]            There are various pictures and diagrams showing the location of the day tank in the engine room. Its arrangement is not in dispute and the parties agree that the diagram prepared by Mr. Brox, shown at Exhibit D-33, figure 19, is correct.

[23]            The day tank is located forward in the engine room. The day tank valves, that is the return valves of fuel to the port and starboard tank, are located above it. The return line carries unburned fuel back to the fuel line. The valves are closed when the levers are perpendicular to the return line. They are open when the levers are parallel to the line. When both valves are closed, fuel will rise up through the day tank vent line. At the time of the fire and unknown to the Plaintiffs, the day tank vent line terminated in the funnel, not outside the funnel.

ii)          The 1995 and 1997 repairs by Allied

[24]            In the spring of 1995, James Fiddler, Mark Stephen and David Fiddler noticed dirty smoke exiting the exhaust vent in the funnel cap. They could also smell diesel fumes. On the basis of these observations, they suspected there was a leak from the exhaust system in the engine room.

[25]            During the months of June and July 1995, the Defendant completed a refit of the "KNIGHT DRAGON" (the "refit contract"). The Defendant, at the request of the Plaintiffs, installed a new main engine on the vessel. Installation of the main engine required the installation of new silencers. The old engine, which was originally fitted into the vessel upon her construction in 1980, was serviced by one silencer. When the main engine was replaced, the original silencer was found to be too greatly deteriorated for any future use and required a replacement. Since the new main engine had two turbo chargers, it required two exhaust pipes and two mufflers.

[26]            The insulation blankets on the lower level of the exhaust casing were very dirty in 1995. Jim Fiddler and another crew member washed the exhaust casing in 1995 using soapy water and rags . This work was done by the crew, rather than by employees of Allied, because it was less expensive.

[27]            The Plaintiffs testified that the exhaust casing was a little dirtier in 1997 than it had been in 1995. The exhaust casing was cleaned again in 1997 and the Plaintiffs said that by September 1997 it was not much dirtier than it had been in 1995.

[28]            The Defendant subcontracted with Alexander Installations Inc., for the fabrication and installation of new blankets for the main engine and new auxiliary engine exhaust piping and also for the repair of fibreglass insulation on the interior of the exhaust casing.

[29]            James Fiddler testified that Jim McLaren, a principal of the Defendant, and the person in charge of design at the shipyard, designed the new exhaust and muffler system. The Plaintiffs wanted top-grade mufflers, which would provide the greatest reduction of noise, otherwise known as "critical care" silencers. James Fiddler testified that he relied on Mr. McLaren to design an adequate and appropriate system, and that he discussed the need for flexibility in that system to accommodate expansion and contraction of the exhaust pipe in response to changes in temperature.

[30]            In July 1997, the Plaintiffs returned the "KNIGHT DRAGON" to the Defendant's shipyard for inspection and repair of its main engine exhaust system (the "1997 repairs"). The crew noticed exhaust gas exiting the vent at the back of the funnel, rather than the exhaust pipe, similar to the situation in 1995.

[31]            After inspection by the Defendant in July 1997, the silencers for the main engine exhaust were found to be cracked on the ends. These were repaired and the silencers which were reinstalled in the "KNIGHT DRAGON" in 1997 are still in operation on the vessel. In addition to the reinstallation and modification of the main engine exhaust casing and silencers, the 1997 repairs also involved operational trials by the Defendant of the main engine and performance checks of the main engine exhaust system.

[32]            The silencers were repaired in July 1997 and were subject to air pressure tests to ensure that they were air tight before work was finished. The evidence is that air pressure of about 20 pounds per square inch (psi) was applied and the silencers were found to be airtight. Following completion of repairs to the exhaust system, conducted by the Defendant without charge as warranty work, the vessel departed on July 21, 1997. No problems were experiences with either the engine or exhaust systems from that date up to the fire.

iii)          The fire on September 22, 1997

[33]            On September 22, 1997, the "KNIGHT DRAGON" was at sea in the vicinity of San Juan Island, Washington, travelling to Port Angeles, with a load of fish to be sold there. At the time, Mr. David Fiddler was acting as Master. James Fiddler and James Brown were serving as deck hands. Mr. Mark Stephen was the Engineer. The crew had all participated in the fishing trip which had commenced on September 2, 1997. The fishing activity concluded around 1:00 p.m. on September 22. At this time, the main engine was in operation, operating at between 1,300 - 1,400 revolutions per hour. The Isusu auxiliary engine was also operating. That engine was engaged to cool the refrigerated sea water which was necessary to keep the catch chilled.

[34]            The fire broke out at approximately 5:00 p.m. At that time, David Fiddler was resting in the Master's cabin. Mark Stephen was in the engine room. The whereabouts of James Brown are not clearly known. James Fiddler was on deck.

[35]            According to Mark Stephen, he was in the engine room in the area of the bilge pump manifold, preparing to pump the bilges, after checking the main engine and checking around the engine room to see that all was in order. While standing by the bilge pump manifold he heard a loud noise. He described it as a loud "whomp" or "woof". He saw a fireball come down the engine room exhaust casing before it was swept up the casing. He yelled "fire" from the engine room.

[36]            James Fiddler, who was in the wheelhouse, called to his brother Dave who was just rising from his bunk. David Fiddler told James to send out an emergency call. James Fiddler called Tofino Vessel Traffic and advised that a fire had broken out on board.

[37]            Shortly afterwards, the Halon fire suppression system was activated in the engine room. The Halon gas filled the engine room and went into the exhaust casing. A hose was activated and water was sprayed into the exhaust casing. The fire broke through the aluminium access panel to the exhaust casing on the main deck level and flames spread to the arborite covering. Flames also spread to the walls of the Master's cabin.

[38]            Flames travelled up the exhaust casing and came out the vent on the side of the funnel cap situated on the top deck of the vessel. A heat shimmer was also visible in the area of the vent. James Fiddler was still in the vicinity of the wheelhouse. Mark Stephen and Jim Brown also went there with a hose, to fight the flame in the wheelhouse and around the Master's cabin. When those flames were under control, a hose was brought round to Jim Brown so that he could extinguish the flames coming from the funnel vent.

[39]            James Fiddler attempted to remove the aluminium hatch on the manhole at the top of the funnel cap. It was too hot to touch and he asked David Fiddler to bring him a pair of welder's gloves. David Fiddler brought the gloves and James Fiddler then manoeuvred the hose so that he could insert it into the grates of the vent. He did so and poured water down the exhaust casing.

[40]            Polypropylene nets in the vicinity of the funnel cap also burned; that fire was extinguished with water. According to the evidence, the fire in the exhaust casing and in the interior spaces was extinguished after approximately eighty minutes of firefighting activity.

[41]            While James Fiddler was in the wheelhouse and in answer to an inquiry from Mark Stephen, the main engine was shut down. The air compressor valves were also shut down.

[42]            Damage on the "KNIGHT DRAGON", as documented by expert witness Ian Head, was sustained to the upper, aluminium section of the exhaust casing. He described this area as badly heat affected and buckled in the area of the bridge deck. The aluminum door to the exhaust casing from the accommodation deck below had melted, allowing fire damage to spread to the accommodation and wheelhouse areas.

[43]            The accommodation deck spaces, the Master's cabin and the wheelhouse were generally badly smoke damaged and heat affected in certain areas. The electrical and navigational equipment sustained heat and water damage. Within the engine room, the Cummins main diesel engine had sustained damage by fire and burning debris falling down from the exhaust casing above. Specifically, there was fire damage to the aluminium air intake filters and casings, and the cylinder heads had been subjected to exposure of heat and flame.

iv)         Events and inspection after the fire

[44]            The vessel was towed to Port Angeles, arriving late on the night of September 22. A representative from Cummins Diesel Engine, the manufacturer of the main engine, attended at the vessel on September 23. As well, Mr. Jim Lindsay, a marine surveyor, attended on behalf of the vessel's insurer.

[45]            The vessel unloaded her catch on September 24. Being without motor power, she was towed back to Steveston, British Columbia, on September 25. The vessel was out of commission, at least for fishing purposes, for several months. That forced inactivity gave rise to a claim for lost income, both on the part of the corporate Plaintiffs and three of the crew members, that is David Fiddler, James Fiddler and Mark Stephen.

[46]            A number of people came to inspect the damage on the vessel following her return to Steveston. On October 1, 1997, Mr. Andy Bowman, a fire investigator, attended on behalf of the Plaintiffs. He carried out an inspection and subsequently prepared two reports. He testified as an expert witness at trial.

[47]            On October 2, 1997, a number of people attended on board for the purpose of overseeing the removal of the aft main engine silencer and the port auxiliary silencer. A man named Bill, from Trites Marine, was engaged to unwrap the silencers. According to James Fiddler, he was engaged to provide an independent third party presence. Mr. Fiddler was present for this process, as was Mr. Lindsay and Mr. Steven Barber, an assistant pipe foreman for the Defendant.

[48]            They unwrapped the flanges within the silencers and the silencers themselves. Vertical cracks were observed in some gaskets and Mr. James Fiddler inserted knives between the flanges, to demonstrate the failure of gaskets. Pictures were taken of the knives shown in Exhibit 2, pages 31 and 32.

[49]            The forward main engine silencer was removed between October 10, 1997 and October 21, 1997.

[50]            Mr. Ian Head, a marine engineer who worked for the Salvage Association of London in their Vancouver office, investigated the cause of the fire on behalf of the underwriters for the Defendant. On October 10, 1997, he went to the vessel to inspect the damage for himself. He went on board and met Mr. Jim Fiddler who gave him an account of the accident. He looked at the engine room and funnel of the pipes and looked at the damage. During his initial attendance on the vessel on October 10, 1997, Mr. Head took a series of photographs which are attached to his report, dated May 19, 1998.

[51]            A fire expert, Mr. Wayne Brox, then investigated the vessel on October 21, 1997.    In addition to Mr. Brox, Mr. Head, Mr. David Fiddler, Mr. James Fiddler, one of the McLaren brothers and a number of other people were also on board the vessel.

[52]            On this date, that is, October 21, 1997, there was an accidental oil spill from the day tank. Mr. Head testified that he went to the engine room and saw fuel running down into the engine room, in the vicinity of the exhaust casing oil spill.

PLAINTIFFS' SUBMISSIONS

[53]            The Plaintiff's frame their cause of action against the Defendant as breach of contract. The Plaintiffs claim that the fire resulted from the negligent or improper work carried out by the Defendant during the refit contract or the main engine exhaust repair contract, or both. Paragraphs 11, 13, 15 and 18 of the statement of claim are relevant and provide as follows:

11.            During the months of June and July 1995 the Defendant completed a refit of the "KNIGHT DRAGON" at its North Vancouver shipyard for Fiddler Joint Venture (the "Refit Contract"), which included the installation of exhaust trunking and mufflers for the vessel's main engine. Such trunking and mufflers were improperly installed, as they were fitted in fixed positions without means of expansion.

13.            In July 1997 Fiddler Joint Venture returned the "KNIGHT DRAGON" to the Defendant's shipyard for inspection and repair of its main engine exhaust system. Particulars of such repairs effected by the Defendant included:

(a)            refitting or reinstallation and modification of main engine exhaust trunking and mufflers, as well as associated uptake supports and insulation; and

(b)           operational trials of the main engine and performance checks of its exhaust system. (the "Main Engine Exhaust Repairs").

15.            On or about 22 September 1997 the "KNIGHT DRAGON" was underway in the Strait of Juan de Fuca and proceeding from a fishery to Port Angeles, Washington when a fire in her engine uptakes occurred (the "Fire"). The Fire resulted from the negligent or improper work completed by the Defendant during the Refit Contract or the Main Engine Exhaust Repairs, or both, resulting in extensive damage to the main engine, its exhaust system, electrical and electronic equipment, wheelhouse and engine room of the "KNIGHT DRAGON". Personal effects, fitted equipment and fishing gear were also lost or damaged as a result of the Fire.

18.            In addition, the Defendant negligently performed the Refit Contract and the Main Engine Repairs, resulting in the Fire and which occasioned loss and damage, including economic loss to the Plaintiffs. Particulars of such negligence include:

(a)            a failure to properly design and install engine exhaust trunking and mufflers, and their associated support and insulation fittings;

(b)           failing to properly inspect completed engine and exhaust system repairs;

(c)             a failure to properly advise the Plaintiffs of the possible risks posed by exhaust gas escapement and deposits in the uptakes of the "KNIGHT DRAGON";

(d)           fitting unsuitable exhaust trunking and associated equipment within the "KNIGHT DRAGON";

(e)           the fitting of defective or unsuitable casketing material to the engine exhaust trunking of the "KNIGHT DRAGON"; and

(f)            a failure to check the quality of repairs to the "KNIGHT DRAGON" through proper machinery and sea trials.

[54]            The Plaintiffs argue that the fire on September 22, 1997 was caused by the failure of certain gaskets used in the exhaust silencers. The failure of one or more gaskets allowed exhaust gases to escape. Unburned hydrocarbons in the exhaust gases somehow ignited, the fire resulted and substantial damage was caused to the vessel.

[55]            The Plaintiffs rely on the evidence that in fact, the gasket used in the main engine silencers was not adequate for the task. That gasket, being a "Blue-Guard Garlock" 3200 or 3400 was not rated for the continuous high temperatures to which it would be exposed.

[56]            Each of the individual Plaintiffs was asked about the source of ignition for the fire. The three individual Plaintiffs said that the source of ignition was hot exhaust gas leaking from a broken or failed gasket on one of the silencers. When asked about the fuel involved in the fire, James Fiddler and Mark Stephen identified the fuel as soot or carbon at someplace in the exhaust casing. David Fiddler also said that soot was a cause and also relied upon "other vapour" without identifying it.

[57]            Briefly, the Plaintiffs' theory about the cause of the fire is that the Defendant's use of an improper gasket in the exhaust silencer caused that gasket to fail, thereby allowing exhaust gases to escape and that these exhaust gases, containing unburned hydrocarbons, resulted in the fire.

Plaintiffs' Expert Witnesses

[58]            The Plaintiffs called three expert witnesses to offer opinions as to the cause of the fire. They were Mr. Andy Bowman, Mr. Lyle Johnson and Mr. Daryl Hansen. Mr. Bowman and Mr. Johnson were qualified as expert witnesses in the area of fire investigation and fire origin, while Mr. Hansen was qualified as having expertise in the maintenance of marine engines.

[59]            Mr. Andy Bowman is a fire investigator. He works full-time as a fire investigator and has taken a number of courses in the area of fire investigation. He attended on board the vessel on October 1, 1997. He took photographs and later prepared a report. He attended at the request of Mr. Jim Lindsay, a ship surveyor.

[60]            Mr. Bowman prepared two reports, the first one dated October 28, 1997 and the second report is undated. The first report refers to attendance by Mr. Bowman on board the "KNIGHT DRAGON" on October 1, 1997. In this first report, Mr. Bowman offered the opinion that the fire was caused by the escape of exhaust gases through a faulty gasket, specifically from the port auxiliary silencer. He spoke about the burn pattern.

[61]            Mr. Bowman ruled out arson or electrical failure as being a cause of the fire. He identified the area of origin as being inside the exhaust casing at the level "directly above the engine room" on the accommodation deck. He identified the point of origin as "near the floor at this level in the aft port side" of the exhaust casing, near the bottom of the silencer and exhaust pipe flange that were located there. Mr. Bowman concluded that the point of origin for the fire was at the lower section of this muffler and/or exhaust pipe flange and although he stated that he did not remove the muffler and exhaust pipe to "further determine the effect cause" he concluded that the fire occurred as the result of hot exhaust gases escaping into the exhaust casing at the point of origin that he identified for the fire. In other words, Mr. Bowman concluded that the escape of hot exhaust gases into the exhaust casing, in the area of the port auxiliary silencer, caused the fire.

[62]            Mr. Bowman's second, undated report refers to and relies upon his initial report. In his second report, Mr. Bowman provides further details about the issue of burn pattern and the significance of the burn pattern in determining the cause of the fire.

[63]            In this second report, Mr. Bowman reiterated his opinion that the escape of hot exhaust gases from the exhaust casing caused the fire. He introduced a second scenario for the cause of the fire, that is that the exhaust gases, consisting primarily of unburned fuel gas, would not only build up in the exhaust casing but would impinge upon the adjacent interior wall materials, thereby causing the wall material to become dry and capable of being ignited by the temperature of the escaping exhaust gas. In other words, the high temperatures of the exhaust gases would cause the adjacent combustible material, that is the wood studs on the inside of the exhaust casing, to become so dry whereby the temperature of the escaping exhaust gases would be sufficient to cause a fire.

[64]            In either case, Mr. Bowman held the view that the cause of the fire was inextricably linked to the escape of exhaust gases from the silencers, as the result of gasket failure.

[65]            Mr. Bowman was of the view that the fire started at a lower level and then moved upward, horizontally. He referred to photographs 23 and 24 of his first report to illustrate that opinion. These photographs show damage done by the fire to the aluminium panel which was on the outside of the exhaust casing, on the accommodations deck. These photos show the disintegration of the aluminium panel as a result of exposure to the heat from the fire. Mr. Bowman, in cross-examination, said that the melting point for aluminium was around 1200 degrees fahrenheit for pure aluminium and slightly less for an aluminium alloy.

[66]            Mr. Bowman, on cross-examination, referred to the silencer closest to the access panel as being the one shown in photos 26 - 31 of his first report. Later, he said that the silencer shown at photos 29 and 30 was traced by him to the port auxiliary engine.

[67]            Again, during cross-examination, Mr. Bowman stated his opinion that the fire started in the level above the engine room. The fireball came down and then went back up the exhaust casing. However, it is clear from his cross-examination, that Mr. Bowman did not know the point of ignition for the fire but he appeared to be consistently saying that the fire was the result of the escape of exhaust gases.

[68]            Mr. Bowman said that he would not expect to find any sign of a liquid fuel by the time he attended on the vessel, several days after the fire. He said once liquid fuel burns, it combusts completely. He discounted the possibility that the fire was due to ignition of liquid fuel, by relying on the low burn pattern. He said that there was no burn pattern extending upward. He relied on soot patterns on the bottom of the silencers and says that these indicate smoke in that area which condensed onto the silencer and flange.

[69]            Mr. Bowman said that the likely source of ignition was the hot exhaust gas and later in cross-examination, said that exhaust gas is the fuel that ignited.

[70]            During cross-examination, the point was put to Mr. Bowman that the Plaintiffs say that the fuel for the fire was unburned carbon on the walls of the exhaust casing and on the fabric of the wrapping. Mr. Bowman said that he was unaware that the Plaintiffs held this opinion. He also confirmed that in his report, he did not primarily consider carbon to be the fuel.

[71]            Mr. Bowman was unaware of the oil spill incident of October 21, 1997 prior to preparing his report. He thought that the spill of oil in the funnel that day was a test; he did not realize that it was an accident. Mr. Bowman was also unaware of the firefighting activity undertaken and his investigation did not address how this could have affected the damage and path of the fire.

[72]            When asked about the ignition point for Number 2 diesel oil, Mr. Bowman said in cross-examination that he believed it to be around 900 degrees fahrenheit. It was put to Mr. Bowman that the ignition point was 125 degrees and in response Mr. Bowman discussed the process of atomization . He also said that it was possible to ignite diesel fuel as a liquid. When questioned about the description of the fireball, as described by Mark Stephen in his evidence, Mr. Bowman said that a "whoop" is considered a low grade explosion. A fireball which follows such noise indicates there has been ignition of a fuel. Mr. Bowman said this is consistent with ignition of diesel fuel vapour. These remarks relate to his first report.

[73]            In connection with his second report, Mr. Bowman was cross-examined about the characteristics of Number 2 diesel fuel. When told that 500 degrees fahrenheit is the temperature for auto ignition of diesel fuel, Mr. Bowman said he was surprised and thinks this temperature is too low. However, he also said that he has never done tests to determine the auto ignition point of Number 2 diesel.

[74]            He was questioned about the damage to the aluminium panel and offered the opinion that the impingement of the exhaust heat onto the aluminium alloy panel created the meltdown. This could have happened without a gasket leak from the port auxiliary silencer.

[75]            In cross-examination, Mr. Bowman admitted that he had not done personal testing relative to the composition of diesel gas. He had not done any testing on a Cummins engine. He had not seen a backfire in a Cummins engine.

[76]            Mr. Bowman consistently maintained his theory that the leaking exhaust gas was of a sufficiently high temperature that when it came in contact with the exterior wall of the exhaust casing, it then heated the insulation and the exhaust casing itself, composed of steel at the main deck level, with the exception of the aluminum access panel, and of aluminium at the wheelhouse deck level, and then burst into flames.

[77]            The second expert witness called by the Plaintiffs was Mr. Darryl Hansen. Mr. Hansen is a professional engineer and while employed by Fenco McLaren Inc., wrote a report on behalf of the Plaintiffs. This report, dated November 29, 2000, contains the opinion of Mr. Hansen on two questions relating to the main engine exhaust system in use on the vessel at the time of the fire. According to his report, he was providing an opinion in response to the following two questions:

1.              Was the vessel's main engine twin (or bifurcated) exhaust system improperly designed and/or installed during the refit of the vessel?

2.              Was an improper grade or specification of gasket installed between flanges of the main engine exhaust system?

[78]            Mr. Hansen answered both questions in the affirmative. Insofar as the sufficiency of the main engine exhaust system was concerned, he concluded that the system was not fit for its purposes due to the failure of the Defendant to include a flex assembly for the two main engine silencers. Mr. Hansen concluded that the arrangement of the silencers, as designed and installed by Allied, was inadequate to accommodate the natural contraction and expansion which would occur in the silencers. This failure would cause additional stress which would lead to damage of the silencers. The additional stress would also put extra and excessive pressure on the gasket materials used in the silencer.

[79]            On the second question, Mr. Hansen readily concluded that the gaskets used in the installation of the silencers were not suitable. The primary fault was that the gaskets, as used, had a maximum continuous rating of 400 degrees fahrenheit while the engine exhaust could reach temperatures of 860 degrees fahrenheit.

[80]            Mr. Hansen coupled the use of inadequate gaskets with the absence of flex assembly in the silencer arrangement and concluded that this construction would have caused excessive stress on the silencer joints, including the gaskets.

[81]            Lyle Johnson was the third expert called on behalf of the Plaintiffs. He is a professional engineer with particular training in metallurgical engineering. He has many years experience in fire investigations and has previously been accepted as an expert for the purposes of litigation.

[82]            Mr. Johnson was tendered as a witness for the purpose of expressing an expert opinion as to the cause and origin of the fire. He was accepted as an expert in that capacity. In his report, dated September 28, 2001, Mr. Johnson stated that in the course of preparing his own report, he had reviewed the reports prepared by Mr. Bowman, Mr. Hansen and two reports prepared by Mr. Wayne Brox, on behalf of the Defendant. He also indicated that he had examined the engine room and funnel areas of the ship and stated the physical facts relating to the configuration of the ship, upon which he was relying.

[83]            Mr. Johnson expressed the opinion that the fire on the vessel occurred by ignition of combustible vapour. He identified two possible sources of the vapour, the first being diesel oil overflow from the tray in the funnel cavity where the day tank vent pipe exits and second, the generation of vapour from heat exposure of surface deposits in the funnel cavity. The funnel cavity, according to Mr. Johnson, includes the upper part of the funnel surrounded by sheet metal with a grill in it, as well as the exhaust casing.

[84]            Mr. Johnson relied on a finding that a gasket failure occurred at a flange interface of the exhaust system within the funnel cavity. In such circumstances, he said it was possible to have vapour formed by the heating of previously deposited material on the external surfaces, as well as deposited unburned hydrocarbons around the area of gasket failure. He said that unburned hydrocarbons could ignite on external areas of the exhaust system under certain conditions. These conditions include the presence of oxygen, the presence of high temperature exhaust surfaces and/or exhaust gases and the proximity of unburned hydrocarbons and combustible vapour. He concluded that the fire damage in the exhaust casing is more consistent with a fire being caused by this source of combustion since extreme damage was not found in the funnel cavity.

[85]            He said that the gasket failure at a flanged joint would ultimately provide the source of ignition. His final conclusion was as follows:

The presence of combustible vapour would provide the means for a rapid flame front advancement. The placement of the overflow (day) tank vent outlet within the funnel cavity rather than outside the cavity would provide opportunity for fuel flow into the cavity.

[86]            In his evidence at trial, Mr. Johnson acknowledged certain errors in the factual assumptions underlying his report. When writing his report, he had assumed that the gasket flanges were wrapped within the same blanket wrapping that covered the barrels of the exhaust pipe. He was unaware that the flanges were individually wrapped but said that this did not change his opinion concerning the effect of a gasket failure. He also said that he did not know that the spill tray is part of the top deck of the vessel. He did not consider that there was a void space beneath the tray and that the master's cabin was beneath the tray. He also said that he was wrong concerning his assessment of the location of the vent opening; it is not close to the edge of the tray.

[87]            Mr. Johnson said that he was told by Mr. James Fiddler that a gasket had failed but he was not told which gasket had failed. He was told where the gasket was located but he does not cover that point in his report. He said he understood from his conversation with Mr. Fiddler that a gasket failed, evidenced by large pieces that had broken but the entire gasket was not blown out.

[88]            As well, Mr. Johnson said that he did not inquire about the fire fighting efforts undertaken on the vessel. He did not know the sequence of fire fighting activity before he gave his opinion.

[89]            He gave the opinion that the ignition of diesel fuel did not cause the fire in the funnel cavity. He himself did not see evidence of fuel flow into the funnel cavity but was provided with a photograph that showed fuel on the spill tray, that is Exhibit 3, page 22.

[90]            In cross-examination, Mr. Johnson was questioned about this photograph and admitted that if there was diesel fuel on the tray, given that the tray has a slope towards the port forward corner, the fuel would flow into the port aft corner of the exhaust casing. The port auxiliary silencer is located in that area. That silencer sits on an uninsulated platform with a small raised lip. Mr. Johnson agreed that if diesel fuel spilled over the corner of that spill tray and landed on the platform shown at Exhibit 29, there would be an automatic ignition of vapour, possibly characterized by a fireball and an explosion. He acknowledged that this could happen, followed immediately by a flame running up the vertical wall where the fuel is flowing down.

[91]            Mr. Johnson said that the auto ignition temperature for diesel fuel, that is the temperature at which a vapour would ignite by itself, is 600 degrees fahrenheit or more. He disagreed with the suggestion that the auto ignition point for diesel fuel was lower, around 400 degrees fahrenheit.

[92]            Mr. Johnson spoke about the placement of oily deposits on surfaces in the engine room. Due to the positive ventilation in the engine room provided by a 30-inch diameter fan, exhaust deposits can be carried up through the exhaust system and out into the atmosphere. The presence of oily deposits on equipment and surrounding surfaces depends upon the general good operation of the equipment and the state of cleanliness maintained in the engine room. A leak in a gasket, in the exhaust casing, can contribute to the presence of oily deposits on the surrounding walls. He said that cleaning the surfaces with water would not be effective to remove the oily deposits, cleaning with rags would be more effective.

[93]            Mr. Johnson did not refer to any tests that he had conducted concerning the auto ignition of diesel fuel vapours or the ignition by diesel fuel vapours of condensed vapours, either in a liquid or solid form. Neither had Mr. Johnson conducted any studies to determine what the heat build up would be in the area of a failed gasket where the flange was individually wrapped and the escaping gases would initially strike the wrapper, before escaping into the atmosphere.

DEFENDANT'S SUBMISSIONS

[94]            The Defendant submits that the Plaintiffs have not met their burden of proof, in demonstrating, on a balance of probabilities, that any negligence of the Defendant caused the fire. The Defendant attacks the sufficiency and quality of the Plaintiffs' expert evidence. The Defendant then suggests and provides expert evidence of an alternative theory as to the cause of the fire, that is related to a diesel oil spill, to demonstrate that the cause of the fire could not reasonably be related to the use of improper gaskets.

Defendant's Expert Witnesses

[95]            The Defendant called two expert witnesses, Mr. Ian Head and Mr. Frank Brox.

[96]            Mr. Head was tendered as a witness both as to fact and opinion, concerning the cause of the fire. Mr. Head is a marine engineer with many years of marine experience, including shipboard work as a marine engineer and in later years as a marine surveyor and consultant. Between 1993 and 1998, he worked for the Salvage Association of London in their Vancouver office.

[97]            He was contacted about the fire on the vessel by the underwriters for the Shipyard's comprehensive liability policy, about October 8, 1997. He went to see Mr. Jim McLaren of Allied Shipyard, at the shipyard, to find out what work had been done on the ship. He was told by Mr. McLaren about the work done on two of the silencers and a bit of the jointing used in two of the gaskets. Mr. Head said he was also told by Mr. McLaren that a vent pipe from one of the fuel tanks terminated in the funnel cap.

[98]            On October 10, 1997, Mr. Head went to the vessel to inspect the damage for himself. He went on board and met Mr. Jim Fiddler who gave him an account of the accident. He looked at the engine room and funnel of the pipes and looked at the damage. The specification of repair of the damage had already been made and Mr. Head wanted to check this. During his initial attendance on the vessel on October 10, 1997, Mr. Head took a series of photographs which are attached to his report. That report, Number SAV-78/97 is dated May 19, 1998.

[99]            For the most part, Mr. Head's report addresses what he saw upon his attendance at the vessel, that is the damage resulting from the fire. Mr. Head's report also outlines the necessary repairs. He noted that a specification for damage repairs had already been prepared by the owners' hull and machinery insurers. That specification had been submitted to various shipyards for quotations and the repair work contract was ultimately awarded to Allied Shipbuilders Limited.

[100]        Mr. Head's report also refers to the owners' allegations about the cause of the fire. Mr. Head says that the owners claim that the fire was the direct consequence of negligence by the shipyard in fitting the wrong type of jointing in the main engine exhaust gas cylinders in carrying out work between July 14 and July 18, 1997. He says that the owners allege that the jointing disintegrated, causing leakage of exhaust gases into the exhaust casing which resulted in a fire.

[101]        It appears that Mr. Head did not become aware of this allegation until he went to the vessel on October 10, 1997. On that day, he attended on the vessel with Mr. McLaren. He met James Fiddler and David Fiddler. The fire was described to him in terms of a bright fireball which came down from the engine room casing. The fire extended to the accommodation. He was told that the fire was extinguished by means of water and use of the Halon system in the engine room, and that the fire was extinguished in about two hours. It is not clear when Mr. Head became aware of the allegation of negligence against the shipyard but he said that by the time he was involved, the shipyard had been put on notice that a claim would be forthcoming from the owners.

[102]        Mr. Head said that the exhaust casing showed evidence of a severe fire. There was a lot of soot. Insulation had been damaged by the fire and there was some buckling of the plating. He described the damage in the accommodation area around the exhaust casing as indicative of a secondary fire. The wooden studs were charred. He said this was not so much fire damage as heat affected and smoke damage. He said that the navigational instruments in the wheelhouse had sustained smoke and heat damage rather than fire damage.

[103]        Mr. Head took a number of photographs on October 10, some of which are included in his report. Photos 1 to 18 of his report are photos taken on October 10; photographs 19 to 41 were taken over a period of time during the course of repairs. He took other photographs which were not included in the report. This series of photographs was entered as Exhibit D-23.

[104]        Photograph 24 shows the vent pipe terminating in the funnel cap. Mr. Head said that he took this photograph on October 10, on his first visit to the vessel. He said he was interested in this vent pipe because he had been told about it on October 8 by Mr. McLaren. He said this was a dangerous situation and he went to look at the pipe. He took the photograph but he did not include it in his report. He said he did not know why this photograph was excluded from his report.

[105]        Following his attendance on the vessel on October 10, Mr. Head said that he prepared a summary for his principals and recommended that a fire expert be retained because in his view, the owners' description of the fire was inconsistent with the allegation of a leaking exhaust.

[106]        A fire expert was retained, that is Mr. Wayne Brox. On October 21, 1997, Mr. Head went back to the vessel. Mr. Brox, Mr. David Fiddler, Mr. James Fiddler, one of the McLaren brothers and a number of other people were also on board.

[107]        Mr. Head introduced Mr. Brox to David and James Fiddler, and then left Mr. Brox to conduct his investigation. When asked if he remembered any unusual occurrences on October 21, Mr. Head said that there was an accidental oil spill from the day tank. He did not recall exactly where he was but in response to commotion, he went to the engine room and saw fuel running down into the engine room, in the vicinity of the exhaust casing.

[108]        Mr. Head made a diagram of the day tank, together with the valves and pipelines entering and exiting that tank. He made the diagram in his notebook and subsequently perfected it; this diagram had been entered in evidence as Exhibit D-14. Mr. Head said that he sent this diagram by facsimile to Mr. Brox.

[109]        He said that he did not discuss the incident with the Fiddler brothers. He examined the position of the valves on the day tank and determined that fuel came out of the vent pipe because the valves to both the return lines of the port and starboard tanks were closed. The transfer pipe was running, and for some reason, the high pressure cut-off switch on the day tank did not operate. The pump was running and pushing oil up the pipe until finally it exited from the vent pipe into the funnel.

[110]        Although Mr. Head did not discuss this incident with the Fiddler brothers, he said that he discussed it with Mr. Brox and explained to him how this spill could have happened given the configuration of the valves. If the pump did not cut out, the fuel had no place else to go except up through the pipe.

[111]        Mr. Head was referred again to Exhibit D-3, Photograph No. 22, page 22 and D-23, page 24. The photograph in D-3 shows oil on the floor of the funnel cap. This photograph was taken by Mr. Brox in the presence of Mr. Head.

[112]        In addition to the factual evidence provided by Mr. Head, he was qualified to give opinion evidence as to the cause of the fire. He was so qualified on the basis of his experience as a marine engineer and a marine surveyor with many years experience in the investigation of fires on board ships. Mr. Head expressed the opinion that the fire on board the "KNIGHT DRAGON", being in the nature of an explosion, was more consistent with a fire caused by gas or marine diesel fuel oil rather than by a large build up of carbon deposits. This opinion is contained in his written report and that portion of the report was read into the record.

[113]        Although the Plaintiffs challenged this portion of Mr. Head's report as being a gloss upon the opinion later expressed by Mr. Brox, that view appears inconsistent with the evidence submitted by the Plaintiffs themselves. Exhibit P-24 is an email dated October 13, 1997 which was Mr. Head's preliminary report to the Salvage Association. In this email, Mr. Head said as follows:

But, the description of the fire as being in the nature of an explosion, is, we consider, more consistent with gas, or marine diesel fuel oil, rather than a large buildup of carbon deposits, and in this respect, we would consider it prudent that a fire expert be appointed on behalf of repairers liability interests in order to give his expert opinion on the probable cause of the fire.

[114]        As noted above, a fire expert was retained and this was Mr. Wayne Brox.

[115]        Mr. Brox is a professional engineer with training and experience in fire investigation and analysis. He was tendered as an expert to give opinion evidence as to the cause and origin of the fire in issue, as well as a witness to facts. He was accepted as an expert to provide such opinion evidence.

[116]        Mr. Brox testified that he was contacted by Mr. Head and retained to conduct an investigation into the cause and origin of the fire on board the fishing vessel. He went to the vessel on October 21, 1997 where he was introduced by Mr. Head to James and David Fiddler. He testified that he was provided with a copy of the type of gasket that had been used on board the vessel but he was unable to say when he received it, except that it was prior to his attendance on the vessel.

[117]        When he went to the vessel, Mr. Brox walked around to familiarize himself with the damaged areas. When asked if he had interviewed Mr. James Fiddler or Mr. David Fiddler or anyone else, he answered that he would have asked some questions but he was unable to identify the persons with whom he spoke. He took a series of photographs which are included in his report. He identified photographs 1 to 18 as those taken before the oil spill which occurred on October 21. His report includes the diagram which was prepared by Mr. Head and entered as Exhibit D-14. Mr. Head said he used that diagram to prepare the figure shown as Figure 19 of his report. Figures 20 to 24 were taken after the oil spill on October 21; these Figures include photographs of the funnel cap, the interior of the funnel, the vent line, the escape of fuel into the engine room and the termination of the vent line inside the funnel.

[118]        Mr. Brox testified that he could not remember exactly where he was on the vessel when the spill occurred but Mr. Head arrived and directed him to the engine room where they could see fuel spilling out from the bottom of the exhaust casing and Mr. Brox took the photos at Figures 23 and 24.

[119]        Following his attendance on the vessel on October 21, 1997, Mr. Brox prepared his first report. This report is dated November 18, 1997 and is addressed to Mr. Ian Head at the Salvage Association, Vancouver Office. In this report, he deals with the possibility that the fire, which was described as an explosion and fireball, may have been caused by soot. He discounted that possibility unless there was a reasonable explanation for dispersal of soot throughout the exhaust casing, together with a high energy ignition source.

[120]        Mr. Brox addressed the allegation that gasket failure allowing the escape of exhaust gases into the exhaust casing was a reasonable explanation for the cause of the fire. He said that the temperatures inside the exhaust casing would, even in the absence of a gasket failure, be sufficient to heat fuel above its ignition point. He concluded that the explosion and fire, which took place in the exhaust casing, were caused by a fuel spill from the vent line that terminated at the base of the funnel and then flowed back into the exhaust casing where it ignited. The evidence is that the platform for the port auxiliary silencer was uninsulated.

[121]        He acknowledged that the gaskets used by Allied in the silencer system were inadequate and probably failed, but found that this failure was not related to the cause of the fuel spill. In brief, he concluded that the fire was caused by a fuel spill.

[122]        Mr. Brox prepared a second report on behalf of the Defendant, in which he addressed the two opinions prepared by Mr. Bowman on behalf of the Plaintiffs and the issue of combustibility of diesel engine soot.

[123]        Mr. Brox had been provided with an extract from the discovery examination of Mark Stephen and focused on the fact that Mr. Stephen had described the fire as a "ball of flame" that entered the engine room from the lower end of the exhaust casing. Mr. Stephen apparently had also described the sound as a "concussive air sort of noise", and as a "loud woof and wump". Mr. Brox says that Mr. Bowman erroneously focused his first report upon a fire, without paying sufficient attention to the description of the incident which included an explosion as well as a fire. He says that different considerations apply when considering an explosion and that Mr. Bowman failed to take into account those circumstances. Mr. Brox says that Mr. Bowman's conclusion, relative to escaping hot exhaust gas, does not explain how either a fire or an explosion occur.

[124]        Mr. Brox points out a number of perceived deficiencies in the manner in which Mr. Bowman prepared his first report and suggests that there was unjustified reliance on burn patterns when the underlying investigation does not identify the fuel that was used and how it was applied. In particular, Mr. Brox says that reliance by Mr. Bowman upon the burn patterns in the aluminium access panel from the accommodation deck is not determinative of a uniform fire pattern. He points out that approximately half of that cover had been cut away and was not available for examination and accordingly, the remainder could tell only part of the story.

[125]        As for the second report provided by Mr. Bowman, Mr. Brox comments on the inclusion of certain "facts, observations and assumptions" that were not mentioned in the first Bowman report. He notes that in the second report it says that there were no burn patterns that indicated that an ignitable liquid spill or other escape of fuel had occurred within the exhaust casing or leaked from the exhaust casing into the engine room. Mr. Brox criticizes Mr. Bowman's deduction in this regard.

[126]        Mr. Brox also comments on the statement by Mr. Bowman that "hot exhaust gases had been escaping for some time", by pointing out that the report does not demonstrate that such a leak exists or the length of time it was going on.

[127]        Mr. Brox, in this report dated December 7, 2000, then goes on to discuss the issues of diesel engine exhaust and pyrolysis, as raised by Mr. Bowman. Mr. Brox provides a table outlining the composition of typical diesel exhaust emissions, broken down into major gaseous components, minor gaseous components and solids. He points out that in typical diesel engine exhaust emissions, unburned hydrocarbons account for much less than one per cent of the total emissions, by volume. He points out that for unburned hydrocarbons to burn, a source of ignition must be applied and he says that Mr. Bowman has not identified any such source.

[128]        Mr. Brox takes issue with the manner in which Mr. Bowman treats this issue and says that he has misdescribed it. He says that, most importantly, Mr. Bowman failed to identify what combustible material was pyrolysised by the allegedly escaping exhaust gases.

[129]        Mr. Brox then moved on to speak about the properties of diesel soot and stated that he was unable to find any literature which addressed that question, although material was available concerning the properties of carbon black which is produced by the incomplete combustion of a hydrocarbon.

[130]        Referring to a publication by the Canadian Centre for Occupational Health and Safety, he said that carbon black is not an explosion hazard or subject to spontaneous combustion, unless contaminated by other combustible products and that when ignited, it burns slowly and without flame. He also said that the minimum ignition temperatures for both dust cloud and a deposit are above 500 degrees centigrade which is above the temperature of the exhaust gas.

[131]        In the discussion portion of this report, Mr. Brox goes back to the description of the fire event by Mark Stephen. He says the observations are characteristic of a weak explosion and the fireball is indicative of the ignition of a volatile vapour. He says that normally, no volatile vapour would be present in either the exhaust casing or the exhaust gas and the only source of a volatile vapour that was found was the end of a vent for one of the fuel tanks which terminated in the funnel, at the top of the exhaust casing.

[132]        Mr. Brox concludes by finding that Mr. Bowman has erroneously identified the cause of the fire as being unburned fuel gases that may have accumulated in the exhaust casing and ignited, without identifying the source of ignition. According to Mr. Brox, this explanation is inconsistent with the description of what happened, that is an explosion and fire, and that the only reasonable explanation for these events is a diesel fuel spill inside the exhaust casing.

[133]        Mr. Brox also outlines, in his second report, the tests he conducted to examine the combustibility of diesel engine soot. He states that the purpose of the test was to find out what role, if any, was played by diesel engine soot in the cause of an explosion and fire in the exhaust casing on board the "KNIGHT DRAGON". He provides a series of photographs describing the steps undertaken in the test. He states his conclusions as follows:

Thus, none of the components in diesel engine exhaust are particularly flammable, explosive, or easily ignited. This is also consistent with the historical absence of exhaust system fires.

Therefore, it is our opinion that diesel engine exhaust, or any accumulation of soot from the exhaust, could not have contributed to the cause of the explosion and fire that occurred in the "KNIGHT DRAGON" uptake casing.

[134]        Mr. Brox was questioned in the course of the trial about the opinions expressed in these reports and maintained his basic conclusion, that the fire in issue was not caused by the ignition of unburned hydrocarbons, either by spontaneous combustion or otherwise, or by the ignition of unburned hydrocarbons in soot along the walls of the exhaust casing. He maintained his position that the most reasonable explanation of the cause of the fire was in consequence of a fuel spill from the day tank vent pipe, that allowed diesel fuel to flow into the exhaust casing and become ignited when it came into contact with the hot surfaces in the casing.

ANALYSIS AND DISPOSITION

[135]        As noted at the beginning, the primary issue in this proceeding is the cause of the fire on board the "KNIGHT DRAGON" on September 22, 1997. The action is framed in terms of breach of contract and negligent performance of the contract. The Plaintiffs are alleging that the fire which occurred is attributable to the Defendant, as the result of some deficiency resulting from the work performed on the vessel in June-July 1995 and July 1997.

[136]        The essential allegation raised by the Plaintiffs is that the Defendant improperly or negligently performed work in the exhaust casing, upon the installation of the exhaust silencers, resulting in the escape of exhaust gases which accumulated in the exhaust casing and eventually caused a fire. This is the basic thesis of the Plaintiffs. There are some variations in this basic claim insofar as the Plaintiffs allege that either the exhaust gases, containing unburned hydrocarbons, self-ignited, ignited soot on the walls of the exhaust casing, or heated the temperature in the exhaust casing to such a degree that the heat led to the ignition of adjacent materials.

[137]        The Defendant argues that this theory of the Plaintiffs is unreasonable, having regard to the description of the incident as being an explosion and fire, and submits that the most reasonable explanation for the occurrence of the incident is an oil spill from a vent pipe that terminates in the funnel cap. The Defendant argues that this possibility is reasonable having regard to the evidence, including the evidence of the engineer Mark Stephen. Mr. Stephen described what he saw as being a fireball which swept down the exhaust casing to the engine room, with a loud noise, and then was swept up the exhaust casing.

[138]        The Defendant also elicited evidence concerning the circumstances in which there would be an oil spill from the day tank vent pipe and points to the oil spill which occurred on October 21, 1997 as illustrating how such a spill could occur. It was determined that the spill on that day occurred because the automatic cut out switch for the day tank failed to operate. The Defendant presented a theory that fuel from the day tank vent pipe could spill from the tray in the funnel cap along the port side of the exhaust casing and come in contact with the uninsulated platform holding the port auxiliary silencer. Both Mr. Hansen and Mr. Johnson, expert witnesses for the Plaintiffs, agreed that such a scenario was possible.

[139]        The Plaintiffs argue that the Defendant proposed a theory but has failed to produce evidence in support of the theory. On the other hand, the Defendant submits that the theory raised by the Plaintiffs, is unreasonable and not supported by the evidence.

[140]        The Defendant says that the investigation conducted by the Plaintiffs was deficient. Deficiencies pointed out by the Defendant include a lack of metallurgical testing upon the remnants of the aluminium panel, the manner in which the main silencers and port auxiliary silencer were removed, the lack of photographs taken of the port auxiliary silencer at the time of removal, the lack of photographs taken of the main engine silencers prior to removal of the main blanket wrapping and the flange wrappings, and the lack of photographs taken to show the removal of nuts and bolts on the top and bottom flanges of the main engine silencer.

[141]        The Defendant also criticizes the lack of proper forensic study carried out by the Plaintiffs, such as testing to determine the extent of the gas leak and the amount and temperature of the gas which would have escaped. Furthermore, and critical, in my opinion, is the Defendant's challenge that the Plaintiffs have done no testing to determine the ignition source for the fire.

[142]        The Defendant argues that this is a fire case involving allegations by the Plaintiffs of negligent performance of a contract and therefore the Plaintiffs carry the burden of showing that the cause of the fire is attributable to the Defendant.

[143]        The only authority cited by the parties relative to the burden of proof to be met in this case is Rhesa Shipping Co. S.A. v. Edmonds and another "The Popi M", [1985] 2 All E.R. 712 (H.L.) where the House of Lords determined that when conflicting theories are presented and the Plaintiff bears the burden, the Court is not required to find that one theory or another is applicable. Where the Plaintiffs bear the burden, they must prove the case on the balance of probabilities. At page 714 Lord Brandon for the Court said as follows:

...The first matter is that the burden of proving, on a balance of probabilities, that the ship was lost by perils of the seas is and remains throughout on the shipowners. Although it is open to the underwriters to suggest and seek to prove some other cause of loss, against which the ship was not insured, there is no obligation on them to do so. Moreover, if they chose to do so, there is no obligation on them to prove, even on a balance of probabilities, the truth of their alternative case.

The second matter is that it is always open to a court, even after the kind of prolonged inquiry with a mass of expert evidence which took place in this case, to conclude, at the end of the day, that the proximate cause of the ship's loss, even on a balance of probabilities, remains in doubt, with the consequence that the shipowners have failed to discharge the burden of proof which lay on them

[144]        The sufficiency of evidence to establish the causal connection between the origin of a fire and the act or omission of a particular person has been the subject of many cases. In this regard, I refer to McAuliffe v. Hubbell (1930), 66 O.L.R. 349 (C.A.), where the onus was "very plainly" upon the plaintiff to establish that the cause of an accidental fire was a result of the defendant's negligence and in [1941] S.C.R. 230">DeBrisay v. Canadian Government Merchant Marine Ltd., [1941] S.C.R. 230, where the origin of a fire which destroyed a pier was unknown, the Supreme Court of Canada held that the onus was on the plaintiff to prove that the fire's cause was because of negligence, unless the cause of the fire could be clearly inferred.

[145]        In Wolfe Co. v. Canada (1921), 20 Ex. C.R. 306, Audette J. for the Exchequer Court of Canada, stated as follows at paragraph 61:

The fact that the fire took place is not, of itself evidence of negligence, because its occurrence is quite consistent with due care having been taken. To find negligence under the circumstances, there must be some affirmative evidence of negligence, or some fact from which a forcible inference of negligence may be drawn. The conjecture or surmise built upon in this case are too aleatory and uncertain.

[146]        If the plaintiff fails to meet their onus in proving that a fire that caused damage arose from a particular cause, the action should be dismissed: see Beal v. Michigan Central Railway (1909), 19 O.L.R. 502 (C.A.). A "reasonable inference" and not "mere conjecture" must be possible in proving the cause of a fire: see Kerr v. Canadian Pacific Railway (1913), 49 S.C.R. 33.

[147]        A plaintiff meets the burden of proof as to the origin of a fire if the plaintiff produces evidence enabling a reasonable inference to be drawn as to the origin and excluding any other fair inference and a plaintiff must establish this on a balance of probabilities, as in any other civil action: see Elder v. Kingston (City), [1954] O.R. 397 (C.A.) and Kerr v. Canadian Pacific Railway, supra.

[148]        In the present case, the Plaintiffs allege that the fire resulted from the escape of exhaust gases in the exhaust casing. They say that the exhaust gas leaked from a failed gasket. They say it is irrelevant which gasket failed. They rely upon the admission of Mr. McLaren on behalf of Allied, and the evidence of Mr. Brox and Mr. Hansen, experts called on behalf of the Defendant and Plaintiffs respectively, that the gaskets used in the silencer system were inadequate for the task.

[149]        There appears to be no doubt that the gaskets that were installed in 1997 were inadequate because they did not have a sufficiently high rating for the temperatures to which they would be exposed in the exhaust system. The Plaintiffs say that the gaskets failed and rely on the evidence of Jim Fiddler concerning the insertion of knives after removal of the blanket and wrapper of the forward main engine silencer. The Plaintiffs rely on the evidence of Mr. Fiddler, together with the photographs 31 and 32 of Exhibit 2. According to Mr. James Fiddler, photograph 31, P-2, shows a knife blade inserted between the flange at the bottom of the forward main engine silencer. Photograph 32, Exhibit 2, shows a knife blade inserted in the upper flange arrangement of the forward main engine silencer.

[150]        The Plaintiffs rely on these photographs to prove that the gaskets had failed and thereby provided a means for the escape of exhaust gas. The Defendant takes the position that photograph 31 shows that the knife is stuck in its position after removal of cracked gasket, on the basis of Mr. Fiddler's evidence that the knife was inserted after pieces of cracked gasket were removed.    The Defendant says that the position of the knife indicates that it came in contact with the raised faced flange but no evidence to support a reasonable inference that the lower gasket was broken.

[151]        In relation to the upper flange arrangement, the Defendant says that photograph 32 does not demonstrate that gasket material on the raised faced flange of the upper flange has been destroyed, relying on the photograph of gasket material on the raised face flange of the upper flange as illustrated in Exhibit 3, pages 12, 13 and 14 and by Mr. Brox's first report, Exhibit 33, Tab 1, Figures 11 and 12.

[152]        There was ample evidence to the effect that the critical seal function of the gasket is served by its contact with the raised faced flange. The photographs taken by Mr. Brox indicate the presence of gasket material on the raised faced flange on the upper flange and in the absence of further evidence to show that this material would have failed to serve its sealing function, I am not prepared to find that there was gasket failure in this area.

[153]        However, given the theory of the Plaintiffs that the fire was caused by unburned hydrocarbons in exhaust gases, either as a source of ignition or a source of fuel, the critical question is whether the exhaust gases could operate in that manner.

[154]        At the time of the fire, the main engine and the port auxiliary engine were operating. They were burning No. 2 diesel fuel. The exhaust gases from these engines were carried up through the various pipes into the mufflers in the exhaust chamber. There is evidence that the temperature of the gases, inside the mufflers, would be 860 degrees fahrenheit. There is evidence that the exhaust casing was under positive ventilation from the fan in the engine room and that the exhaust gases were vented to the outside at the top of the exhaust casings where the silencers were connected with the vent pipes, exiting at the top of the funnel.

[155]        The Plaintiffs present three theories, each relating to the ignition of unburned hydrocarbons. The first theory is that exhaust gas leaked from a cracked or destroyed gasket and was heated sufficiently to self-ignite, the correct combination of oxygen, fuel and heat. There is evidence about the composition of typical diesel exhaust emissions. This evidence was submitted by Mr. Brox in his first report dated December 7, 2000, Exhibit D-33, Tab 3, page 6 and sets out the typical diesel exhaust emissions according to the literature. A table is included, as well, in the second report from Mr. Brox dated December 7, 2000 at Exhibit D-33, Tab 4.

[156]        The literature researched by Mr. Brox shows that hydrocarbon gas is less than 1% by volume and carbon solids are recorded in grams per break horsepower hour. This is a very small amount. These quantities were agreed to by Mr. Hansen, an expert for the Plaintiffs. According to this evidence, the amount of unburned fuel in exhaust gas is minimal.

[157]        The Plaintiffs have failed to show the conditions under which exhaust gas could ignite, in a theoretical way. They have also failed to show that these conditions existed in the exhaust casing of the "KNIGHT DRAGON" on September 22, 1997.

[158]        The Plaintiffs led no evidence as to the ability of exhaust gas to ignite in accordance with their theory. The Defendant sought to introduce, upon the cross-examination of Mr. Brox, evidence of a test conducted relative to unburned hydrocarbons but this evidence was excluded upon the objections of the Plaintiffs. The fact remains, then, that there is no evidence before this Court concerning the admission of unburned hydrocarbons and to the extent that the Plaintiffs rely upon this as a cause of the fire, they carry the evidentiary burden of establishing it. They have failed to produce sufficient evidence in this regard to meet the applicable burden of proof, that is, on a balance of probabilities.

[159]        Next, the Plaintiffs advanced the theory that exhaust gas sufficiently heated the walls of the exhaust casing through the insulation and aluminium panel to a temperature that caused the wooden studs to ignite inside the casing. The suggestion is that the heat from the wooden studs then radiated back into the exhaust casing and led to instantaneous combustion of the exhaust gas. This theory is advanced by Mr. Bowman.

[160]        The Defendant challenges this theory on the basis of lack of test results to demonstrate it and lack of support for the theory in any scientific literature.

[161]        There are other problems with this theory. The exhaust casing was subject to positive ventilation. There is no evidence that any member of the crew smelled exhaust gas on the day of the fire, contrary to earlier occasions. The evidence of Mr. Brox has cast doubt on Mr. Bowman's theory of pyrolysis. There is no evidence of metallurgical testing of the portion of the aluminium panel that remained after the fire.

[162]        Again, the evidence submitted by the Plaintiffs does not meet the burden of demonstrating, on the balance of probabilities, that the fire originated in this manner.

[163]        The third theory advanced is that the exhaust gases ignited diesel soot in the exhaust casing. This allegation was advanced by the individual Plaintiffs. Again, the Defendant tendered evidence through Mr. Brox that there is nothing in the literature concerning the burning characteristics of diesel soot.

[164]        Mr. Brox then conducted his own experiment about the burning of soot and the results were submitted in evidence as his second reported dated December 7, 2000, Exhibit 33, Tab 4. The tests conducted by Mr. Brox show that soot is heated to the point where it oxidizes into carbon monoxide and carbon dioxide gas. The burning is slow, non-explosive and does not produce a flame. The matter changes form from a solid to gas. The evidence of Mr. Brox is that, in the face of an explosion and fireball, the incident is more consistent with the combustion of diesel fuel. He testified that diesel fuel, when heated above the auto-ignition point, changes into a gas, and results in an explosion and flame.

[165]        The Plaintiffs have failed to adduce sufficient evidence to show that diesel soot in the exhaust casing was ignited by exhaust gases.

[166]        The Defendant argues that a more reasonable explanation of the explosion and fire is the escape of diesel fuel through the day tank vent pipe, onto the funnel tray and then into the exhaust casing where it made contact with a hot surface, specifically the platform housing the port auxiliary engine silencer. According to the evidence of Mr. Hansen, the temperature of the metal in that uninsulated area was in the range of 550 degrees fahrenheit to 660 degrees fahrenheit. These temperatures would be sufficient to ignite the diesel vapour, resulting in an explosion and flame.

[167]        The Plaintiffs point out that the Defendant's theory rests upon demonstrating that there was a means for the diesel fuel to rise from the engine room, through the day tank vent pipe. The Plaintiffs say the evidence does not support this theory. They rely on the evidence of Mark Stephen, the engineer, who said that he had not touched the valves for some period of time.

[168]        On the other hand, the Defendant points to certain photographs that were taken after the fire that show at least one valve open. One photo, found at Exhibit 5, page 5, was taken between September 21 and October 1 by a Mr. Jim Lindsay, a marine surveyor engaged on behalf of the Plaintiffs. This photograph shows the port return line is closed and the starboard return line is open.

[169]        However, in Exhibit 22, the expert report of Ian Head, photograph 15 shows that the valve for the return of fuel to the starboard fuel tank is open. This photograph was taken on October 10, 1997 by Mr. Head. Finally, Figure 18 in the first report of Mr. Brox, Exhibit 33, Tab 1, shows that both valves are closed. This photograph was taken by Mr. Brox on October 21, 1997, before the oil spill that occurred that day.

[170]        The Defendant says that there is no evidence to show the position of the valve on the day tank on September 22, 1997 and suggests that it is possible that the valve for the starboard fuel tank was open. Since fuel was being drawn from the port fuel tank and the starboard tank was nearly full, according to Mr. Stephen, the fuel would have risen in the day tank. The Defendant suggests that the gag on the starboard fuel tank vent pipe, which exits on the wheel house deck, was closed or otherwise not functioning. It suggests that the automatic transfer pump operated but the high level cut-off switch failed, the same situation which occurred on October 21. On the basis of this view of the evidence, the Defendant invites the Court to infer that a similar situation may have occurred on September 22.

[171]        In my opinion, such inference cannot be drawn. The evidence is not clear as to the actual position of the valves on the day tank on September 22. The fact that the automatic transfer switch failed on October 21 does not necessarily lead to the inference that the same situation happened on September 22. The oil spill on October 22, 1997 merely demonstrates that oil could indeed rise through the day tank vent pipe and exit on the floor of the funnel.

[172]        There was evidence adduced by the Plaintiffs that no fuel exited the starboard fuel tank stand pipe. If the starboard fuel tank was full, the normal first point of exit would be from the stand pipe. The Defendant led no evidence to contradict the evidence of the Plaintiffs in this regard.

[173]        However, in light of the burden which the Plaintiffs must meet in this case, the fact that the Defendant has failed to establish its theory does not affect the ultimate outcome. The Plaintiffs have failed to adduce sufficient evidence to show that the Defendant breached its duty of care arising from the refit contract relating to installation of the new main engine and work on the exhaust system in 1995 or the repair work done in 1997 on the exhaust system. Use of insufficient gaskets is not, per se, proof of negligence in the absence of sufficient proof that exhaust gases escaped and served as a fuel package or ignition source. The Plaintiffs have failed to prove that the cause of the fire was due to the negligent performance by the Defendant of its contractual obligations. The action must be dismissed.

[174]        In light of this finding, it is unnecessary for me to address the claims of the individual Plaintiffs that they were engaged in a joint venture with the corporate Plaintiffs. It is unnecessary for me to deal with the issue of damages.

[175]        The action is dismissed, with costs to the Defendant.

                                                  ORDER

The action is dismissed, with costs to the Defendant.

                                                                                           "E. Heneghan"

                                                                                                      J.F.C.C.

                          FEDERAL COURT OF CANADA

                                       TRIAL DIVISION

    NAMES OF COUNSEL AND SOLICITORS OF RECORD

DOCKET:                   T-842-99

STYLE OF CAUSE: Fiddler Enterprises Ltd. et al. v. Allied Shipbuilders Ltd.

PLACE OF HEARING:                                   Vancouver, British Columbia

DATE OF HEARING:                                     February 11, 2002

REASONS FOR ORDER :                           The Honourable Madam Justice Heneghan

DATED:                      April 17, 2003

APPEARANCES:

Mr. John Bromley

Mr. Jason Kostyniuk                                            FOR PLAINTIFF

Mr. Barry Oland                                                   FOR DEFENDANT

Mr. Simon Barker

SOLICITORS OF RECORD:

Bromley Chapelski

Suite 1150, 777 Hornby Street

Vancouver, B.C.    V6Z 1S4                                             FOR PLAINTIFF

Oland & Co.

Vancouver Centre

P.O. Box 11547

2020 - 6590 West Georgia Street

Vancouver, B.C. V6B 4N7                                              FOR DEFENDANT