Kenny Makichuk and Neil Simpson remained in segregation at Kent until February 1998, when they were transferred to the Special Handling Unit in Quebec. They were returned to the Pacific Region in early May so that their lawyers could prepare for the court hearing on their murder charges. The twists and turns in the course of justice that had characterized the events of "Deadly July" from the very beginning took another unexpected path on the morning of the May 26: while the two prisoners were waiting in the holding cells beneath the courtroom, the Crown entered a stay of proceedings of the murder charges. Although the legal effect of this is merely to suspend proceedings, leaving the Crown with the option of renewing them within a year, in the great majority of cases the entering of a stay marks the end of the prosecution’s trail, as it did in this instance. Crown counsel’s reasons as conveyed both to Defence counsel and to the administration at Kent, were these: The videotape of the incident and the observations of correctional officers on duty at the time were not sufficiently clear to support the criminal charges against Mr. Makichuk and Mr. Simpson. The evidentiary vacuum could only be filled by the evidence of other prisoners prepared to testify for the Crown. As an essential part of its case, Crown counsel had intended to call Mr. Shropshire and Mr. Hepburn. Both had been present at the meeting in the C unit pool room when the issue of the missing Valium was discussed and supposedly resolved; both had been in the yard and witnessed what took place. Prior to the preliminary inquiry, however, Mr. Shropshire had advised Crown counsel that he was not prepared to testify, and counsel felt that his evidence would not be helpful to their case if he was compelled to attend court. Mr. Hepburn had advised Crown counsel before the preliminary inquiry that he would testify the prisoners in C unit planned to attack and kill Mr. Makichuk and his friends in A unit. This evidence would support the anticipated self-defence argument of Mr. Makichuk and Mr. Simpson. Under the circumstances, Crown counsel decided there was no reasonable prospect of succeeding in the prosecution.

After the stay of proceedings had been entered, Mr. Makichuk and Mr. Simpson, through their lawyers, argued that they should not be returned to the Special Handling Unit on the following analysis: their transfers had been based on the allegation that they were involved in an unprovoked attack on Mr. Grenier, resulting in his death; the murder charges had been based on the same allegation; the murder charges had now been stayed on the grounds that these allegations could not be supported through sworn evidence and there was a reasonable prospect a defence of self-defence would be successful; Mr. Makichuk and Mr. Simpson should therefore be treated as if they had acted in self-defence and so their actions were not culpable. This line of argument was no more successful with Kent authorities in 1998 than had been the argument raised two years earlier on behalf of Hughie MacDonald, who, it will be remembered, had been acquitted by a jury of the murder of Gary Allen on the basis of self-defence. It had taken a habeus corpus application to B.C. Supreme Court to secure the release of Mr. MacDonald from segregation, and certainly the institution’s position was that it would take no less than a court order to stop the transfer of Mr. Makichuk and Mr. Simpson back to the Special Handling Unit. The transfers were arranged before any court proceedings could be launched.

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