Executive Summary: Key legal and evidentiary issues

• Coalspur alleges deficient design and engineering work by CWA caused structural failures in an elevated conveyor system at its coal mine near Hinton, Alberta in July 2019.

• CWA's defence relies on clause 10 of the Master Service Agreement, which limits total contractor liability to proceeds from insurance.

• Adequacy and completeness of CWA's responses to court-ordered undertakings regarding its insurance coverage became the central discovery dispute.

• Solicitor-client privilege was recognized as shielding communications between CWA's insurer and its retained defence counsel from disclosure.

• Relevance of CWA's 2023 acquisition by Norda Stelo Inc. to the underlying claim was challenged and deemed speculative by the Court.

• Coalspur's application to compel further and better responses was denied, with questioning costs ordered to be in the cause.

Background and parties involved

Coalspur Mines (Operations) Ltd., along with Chinook Ine Construction Company Ltd. and Bighorn Mining Ltd. (collectively "Coalspur"), own and operate a coal mine near Hinton, Alberta. During the mine's construction, Coalspur engaged CWA Engineers Inc. ("CWA") for design and engineering services related to an elevated conveyor system. In July 2019, certain structural failures occurred in that system. Coalspur claims that deficient work by CWA caused or contributed to these failures and seeks damages, including business interruption losses. The action also names several other defendants and third parties, including Winfield Industrial Sales Ltd., CADD Alta Drafting and Design Inc., CVL Engineers Inc., Lassing Dibben Consulting Engineers Limited, Waiward Industrial Limited Partnership, and Ironclad Metals Inc.

The contractual liability limitation and insurance undertakings

A pivotal element of CWA's defence is clause 10 of the Master Service Agreement between the parties, which states: "The total liability of the Contractor shall be limited to proceeds from insurance." Given this clause, the scope and existence of CWA's applicable insurance became a critical issue. On December 4, 2025, Justice N. Whitling granted an order directing CWA to provide answers to certain undertakings (numbered 76, 78 to 83, and 85) concerning insurance held by CWA in respect of Coalspur's claims. CWA subsequently responded, advising that only one policy of insurance is responsive to Coalspur's claim, a redacted copy of that policy had been produced, CWA had notified its insurer of the claim, no additional correspondence existed between CWA and its insurer respecting the claim, no reports or analyses had been prepared by or for the insurer, and no insurance proceeds had been paid to date.

Coalspur's motion for further and better responses

Coalspur took the position that CWA's answers were "facially implausible and incomplete" and applied to the Court for an order compelling CWA to provide further and better responses. In essence, Coalspur did not accept the truth of CWA's answers and asked the Court to order CWA to provide different ones. The Court found nothing in the record to suggest that CWA had provided false answers. Justice Whitling noted the answers were responsive to the questions and no evidence refuted their contents, meaning the Court and Coalspur must take CWA at its word.

Redactions and privilege

Regarding redactions CWA applied to its produced insurance policy, CWA advised the Court that the redacted portions pertained to other projects which are not a part of this claim. The Court accepted this explanation and found no basis to believe that those redactions withheld any information of relevance to this claim, concluding that cross-examination on this issue would be a waste of time and other resources. The Court further acknowledged that CWA's insurer had retained counsel to defend the claim and that communications of this nature are subject to solicitor-client privilege.

The disputed day of questioning and undertakings 147 to 153

Coalspur also sought relief arising from a day of questioning during which CWA's corporate representative refused to answer questions or grant undertakings respecting insurance and other matters. Coalspur requested answers to undertakings 147 to 153, a direction for the corporate representative to attend further questioning, and an award of thrown-away costs. The Court determined that undertakings 147 to 153 essentially sought the same information already addressed through undertakings 76, 78 to 83, and 85, and that CWA had already provided answers to the underlying questions, which the Court found to be sufficient. To the extent those undertakings sought information in the hands of third parties such as the insurer and the insurance broker, the Court noted that a litigant is only required to produce records under their own control, and there was no basis to believe that any exceptional power to demand such records is held by CWA. Regarding the thrown-away costs claim, the Court did not find that CWA's conduct leading up to or during that questioning justified an award of costs in favour of Coalspur, and ordered that costs of that questioning shall be in the cause.

CWA's recollection and the Norda Stelo acquisition

Coalspur further challenged CWA's responses to undertakings respecting any views CWA may have held to the effect that the tower failure was caused by incorrect or incomplete information from Coalspur. CWA's response is that it has no recollection of having had any such views at the time, but does recall certain information being provided to CWA by a certain person. The Court accepted there was no basis to conclude that CWA had provided false answers and observed that it cannot order CWA to remember something. Separately, Coalspur sought to question CWA about a 2023 acquisition of CWA by Norda Stelo Inc. The Court found that Coalspur had not demonstrated that anything pertaining to that transaction is relevant and material to Coalspur's claim respecting the incident of July 2019, and that Coalspur's arguments respecting potentially relevant information amount to speculation. Further questioning on this subject would not assist the parties in resolving the real issues underlying this claim.

Ruling and outcome

Coalspur's application was denied. Justice N. Whitling of the Court of King's Bench of Alberta held that CWA's undertaking responses were sufficient, the insurance policy redactions were justified, solicitor-client privilege applied to insurer-counsel communications, and questioning about the Norda Stelo acquisition was not relevant and material to the claim. Costs of the questioning of February 24, 2026, were ordered to be in the cause. CWA was the successful party in this application; however, no specific monetary amount was ordered or awarded, as this decision addressed discovery disputes rather than the merits of the underlying damages claim.