It looks like you have a retaining wall just behind this wood wall that you've constructed. I can't tell what is behind it, though. Is it just a freestanding garden wall or is it retaining some soil and other loads? Looks like there might be a patio behind it? A patio and retaining wall directly over an open hole is really asking for trouble.
These kinds of collapses are telling you that you have dug beyond the angle at which your soil can support itself.
There's another thread that popped up yesterday with a similar issue.
I suggested a number of possible fixes in that thread if you want to check it out.
It's possible that, when you fill your liner with water, the pressure of the water against the liner will be enough to withhold the soil. But I probably wouldn't count on it, especially since you have everything open right now and can easily do something about it.