Category Archives: Contamination / Pollution

EPEA v. Limitations Act: Test Set By Alberta Court For Extending Limitation For Environmental Claims

The Alberta Court of Queen’s Bench has set the “test” to be followed in s. 218 applications pursuant to the Environmental Protection and Enhancement Act, R.S.A. 2000, c. E-12 (“EPEA”) in its May 19, 2016 decision in Lakeview Village Professional Centre Corporation v Suncor Energy Inc, et al 2016 ABQB 288.

Background

The plaintiff had purchased lands in the Lakeview subdivision of Calgary in 1998. The plaintiff was aware that a gas station was formerly on the site. This raised concerns of potential contamination of the lands; however, an initial environmental assessment found no significant contamination.

A number of years later, in 2013, the plaintiff received an offer to purchase the lands, prompting another environmental assessment. This assessment found contamination at a level that required remediation of the lands, including the removal of piping, concrete and soil. The plaintiff has spent approximately $400,000 on remediation to date, with further costs expected.

The Action

As a result of these remediation costs, the plaintiff wishes to recoup some or all of these costs from former owners of the lands, including the successor of the gas station operator and the vendor of the lands who commissioned the first environmental assessment (Suncor and Commonwealth Business Management Ltd. (“Commonwealth”)).

The Problem

Normally, the Plaintiff’s action would be out of time under the Limitations Act, R.S.A. 2000, c. L-12, as the contamination / sale of land occurred well past the 10-year ultimate limitation period. However, there is a provision in EPEA that permits a judge to extend the limitation period in some cases.

The Law

Section 218 of EPEA provides that a judge may extend a limitation period where the basis for the action arises out of a “release of a substance into the environment”. The purpose of this extension is that sometimes, contamination may not be identified for several years.

Where an application is made, s. 218 does identify a list of things for a judge to consider: (a) when the alleged adverse effect occurred; (b) whether the alleged adverse effect ought to have been discovered by the claimant had the claimant exercised due diligence in ascertaining the presence of the alleged adverse effect, and whether the claimant exercised such due diligence; (c) whether extending the limitation period would prejudice the proposed defendant’s ability to maintain a defence to the claim on the merits; (d) any other criteria the court considers to be relevant.

However, there was little in the way of case law on this issue, and there was no “test” to guide the court in considering these types of applications. In particular, does a court decide conclusively in these applications whether the limitation period should, or should not be extended? Or, can the court make a preliminary determination giving plaintiffs the green light to go ahead to trial, where the limitation argument may surface again?

The New Test

Ultimately, Justice Martin created a two-step approach for use in s. 218 applications:

  1. Is there sufficient evidence on the s. 218 factors to grant an extension of the limitation period?
  2. If there is not enough evidence to make that determination, or if there is sufficient evidence but an issue for trial could be determined prematurely, has the claimant shown a good arguable case for an extension? If so, the claimant is entitled to an extension of the limitation period subject to a final determination of the issue at trial.

The court reasoned that this approach respects the purpose of s. 218 while acknowledging the legitimate interest of a claimant to know whether to spend further resources on their claim. It also allows the court to extend the limitation period for obviously meritorious s. 218 cases or to weed out cases that are attempting to “abuse the system”.

The Decision

Lakeview was successful in its application and may now proceed with a claim against Suncor and Commonwealth.

The court found that the “adverse effect” may have been as early as 1969, through to as late as 2013, and that this time frame is “not so long ago that it would be unfair to allow the action to proceed against either party”.

Further, the court determined (on a preliminary basis only) that Lakeview had exercised due diligence when purchasing the property from Commonwealth. Lakeview had made it a condition of its purchase that Commonwealth provide information on the environmental status of the property. Commonwealth had commissioned its own environmental assessment which concluded that there was no evidence of significant contamination and no further investigation would be warranted.

The court found no prejudice to Suncor or Commonwealth as neither had presented any evidence that an extension to the limitation period would prejudice their ability to maintain a defence on the merits.

Finally, Commonwealth had attempted to argue that s. 218 only applied to parties that had caused or contributed to the contamination of the lands and as it was only an owner of lands (between Suncor and Lakeview), s. 218 did not apply.

The court, however, found that the wording of s. 218 is broad. Its opening paragraph refers to civil proceedings “where the basis for the proceeding is an alleged adverse effect”. The basis of Lakeview’s action is determining liability from the fallout of an alleged adverse effect. In addition, EPEA also contemplates the liability of a former owner for remediation in its definition of “persons responsible” for a contaminated site:

SECTION 107
Interpretation and application

107 (1) In this Part,

(c) “person responsible for the contaminated site” means

(i) a person responsible for the substance that is in, on or under the contaminated site,

(ii) any other person who the Director considers caused or contributed to the release of the substance into the environment,

(iii) the owner of the contaminated site,

(iv) any previous owner of the contaminated site who was the owner at any time when the substance was in, on or under the contaminated site,


[Emphasis added]

As such, the court found that this case was one contemplated by s. 218, where the harmful effects of contamination were not evident for a number of years, due diligence was shown, and there was no prejudice to the defendants. Accordingly, the court extended the limitation period for Lakeview’s claim and has allowed this matter to proceed to trial.

James Early

Ontario’s Neonicotinoid Law Survives Appeal

In October 2015 I reported on how Ontario’s neonicotinoid law, which dramatically reduces the number of acres planted with corn and soybean seeds coated with a class of pesticides known as neonicotinoids, was to remain in place despite a challenge to that law by the Grain Farmers of Ontario (“GFO”).

As you probably know, there are strong links between neonicotinoids and bee colony collapses, and neonicotinoids are known as being toxic to bees.

In that post, I referenced the fact that the GFO was “reviewing its legal options”, and the GFO ultimately opted to appeal the Ontario Supreme Court’s decision.

Well today, I’m pleased to report that the appeal was heard, and dismissed, by the Ontario Court of Appeal (the “Court”). For a full review of the decision, just click here.

At the appeal, the GFO raised two issues. It submitted that the motion judge erred in finding that:

(1) Ontario Regulation 139/15 made under the Pesticides Act, R.S.O. 1990, c. P.11 (“the Regulation”) does not limit the farmers’ property rights; and

(2) the relief sought is not the determination of rights through the interpretation of a regulation.

In dismissing the appeal, the Court did find that the Regulation narrows the farmers’ range of legally permitted options of treated seeds, and so affects the farmers’ rights. However, the limitation of a right does not, standing alone, create a justiciable issue (an issue that can be tried in a court of law).

The GFO argued that the justiciable issue in this case was found in r. 14.05(3)(d) of the Regulation, which provides:

“(3) A proceeding may be brought by application where these rules authorize the commencement of a proceeding by application or where the relief claimed is,

(d) the determination of rights that depend on the interpretation of a deed, will, contract or other instrument, or on the interpretation of a statute, order in council, regulation or municipal by-law or resolution;”

However, the Court noted that this rule was a procedural rule, and is not a mechanism whereby a person could simply challenge the wisdom or fairness of a governmental action. The Court agreed with the reasoning of the motion judge, citing the Alberta Court of Appeal in Trang v. Alberta (Edmonton Remand Centre) which provided:

“Private litigants are not entitled to use the courts as an indirect method of altering public policy decisions, especially those involving the expenditure of public funds. Just because a private party has a sincere concern about the validity of a public policy does not entitle him or her to litigate its legality: Canadian Council of Churches v. Canada (Minister of Employment and Immigration). As a corollary, the superior courts are not to use their powers to grant generally worded declarations as a method of controlling or influencing governmental operations.”

In the result, Ontario’s neonicotinoid law remains, and its bees are safer for another day.

James Early

Residential Contamination

While we often think of environmental litigation as dealing with significant oil spills, climate change, pollutants being lost from tailings ponds or to challenge government decisions to drastically alter a landscape, more common are the little events, like ones that can occur around your home. That was the case in Jerabek v. Scotia Fuels Ltd. 2015 NSSC 283.

In this case, some homeowners, on the advice of their home inspector, engaged their fuel oil supplier, Scotia Fuels Ltd. (“SF Inc.”) to replace their fuel oil tank in the furnace room of their residence. It was determined that the fuel tank was defectively installed by SF Inc., and an oil spill, consisting of approximately 25 litres of oil, had contaminated the ground below the residence, and reached the first chamber of septic tank which was then excavated and removed.

SF Inc. accepted full responsibility for the incident and assured the homeowners that their house would be made whole again through remediation work without any need to involve SF Inc.’s insurer. Despite this, however, the cleaning work performed by SF Inc. did not fully eliminate the oil smell in the residence. After completion of the remediation work, SF Inc. took the position that any continuing indoor air quality problem at the residence was not associated with the spill of fuel oil and, therefore, terminated its involvement with the residence.

Unfortunately, despite the remediation work, the homeowners could still detect a faint yet persistent hydrocarbon odour in the residence and retained company to conduct further air quality tests. After testing, the company recommended that the residence be cleaned by DLS Group, specialists in hydrocarbon decontamination. After cleaning, the hydrocarbon odour in the residence was fully eliminated. However, the cleaning cost the homeowners over $100,000.00, plus other expenses associated with the spill.

The homeowners brought a successful action for damages, alleging that the spill caused by SF Inc. led to the hydrocarbon smell, its remediation efforts were insufficient, and it then abandoned its remediation efforts. After a thorough review of the evidence, and an analysis of the law of causation in negligence, the Court found in favour of the homeowners, stating that:

““but for” causation is a factual inquiry into what likely happened. Scientific proof of causation is not required.

“…it is more likely than not that the root cause of the faint but persistent hydrocarbon odour complained of was the adherence of fuel oil vapours which permeated certain building materials and household contents during the initial remediation work.” My emphasis.

The homeowners were awarded damages of $166,399.49. The Court found that SF Inc. had an obligation to restore the residence to the same odour-free state that it was in before oil spill occurred.

James Early

Ontario’s Neonicotinoid Law To Remain In Place

CBC and Better Farming are reporting that the Ontario Superior Court has upheld a provincial regulation to dramatically reduce the number of acres planted with corn and soybean seeds coated with a class of pesticides known as neonicotinoids, which are toxic to bees.

The regulation had been under challenge by the Grain Farmers of Ontario and a decision on the application, which was heard on September 28, 2015, was reserved by the Ontario Supreme Court. It is understood that this may not be the last word on this matter and Grain Farmers of Ontario is “reviewing [its] legal options”.

According to the Ministry of Environment and Climate Change, the new provincial requirements are intended to support the government of Ontario’s target to reduce the number of acres planted with neonicotinoid-treated corn and soybean seed by 80 per cent by 2017.

Banning the use of neonicotinoids has been a hot topic for the environmental movement for the past couple of years. For example, both Environmental Defence, and the David Suzuki Foundation, have called for complete bans on neonicotinoid use on the basis of studies which have shown and link between neonicotinoid pesticide use and escalating honeybee colony losses.

The decision follows on the heels of a US decision in September, 2015 where a US court overturned federal approval for a new  neonicotinoid formulation called sulfoxaflor. In that decision, the US court found that the Environmental Protection Agency had relied on “flawed and limited” data, and its green light was unjustified given the “precariousness of bee populations”.

It is time for an outright ban, country-wide, in Canada.

James Early

Ontario’s Great Lakes Protection Act

Today, October 7, 2015, Ontario passed the Great Lakes Protection Act (the “Act“). The Act is designed to strengthen Ontario’s ability to keep the Great Lakes and St. Lawrence River clean, as well as to protect and restore the waterways that flow into them.

According to the provincial government’s news release, the Act enables the province to address significant environmental challenges to the Great Lakes, including climate change, harmful pollutants and algal blooms. The Act will also:

  • Establish a Great Lakes Guardians’ Council to provide a collaborative forum for discussing and gaining input on issues and priorities relating to the Great Lakes.
  • Allow the Ministry of the Environment and Climate Change to set environmental targets and enable communities to address local problems.
  • Require the establishment of monitoring programs on a number of water quality indices where needed, as well as regular public reporting.
  • Require consideration of Traditional Ecological Knowledge in decisions made about the health of the Great Lakes if offered by First Nations or Métis communities.
  • Enshrine Ontario’s Great Lakes Strategy the province’s action plan on the Great Lakes, as a living document to be reviewed every six years and reported in the legislature every three years.

This is extremely positive news given the declining health of the Great Lakes, particularly with regard to recent toxic algal blooms and the availability of clean drinking water for those people reliant on the Great Lakes’ fresh water supply.

According to Environmental Defence, who has championed this Act for a number of years, the Act will lead to:

  • Empowered communities through consultation and new opportunities for involvement;
  • Consideration of traditional ecological knowledge in research and decision-making;
  • Provincial commitment to meeting targets that will reduce or eliminate harmful pollutants and address algal blooms; and
  • Accountability, through improved monitoring and reporting.

The Great Lakes basin is home to 98 per cent of Ontario’s population, 95 per cent of its agricultural lands, 80 per cent of its power generation capacity and 75 per cent of Canada’s manufacturing sector. Additionally, Ontario has 10,000 kilometres of Great Lakes and St. Lawrence shoreline, the longest freshwater coastline in the world. This is reason enough to celebrate the passing of the Great Lakes Protection Act.

James Early

Duty to Report / Transfer of Responsibility: Saskatchewan’s new Environmental Legislation

Saskatchewan’s Environmental Management and Protection Act, 2010 (“EMPA 2010”) came in to force on June 1, 2015 and has a couple of new features of interest to those involved in the development and transfer of real estate.

First, the EMPA 2010 contains a duty to report a “discovery”. That duty attaches to: any person who discharges or allows the discharge of a substance that may cause, or is causing, an adverse effect; any person who owns or occupies lands on which a substance is discovered; any person who, while conducting work on the lands, discovers such a substance; and any police officer or employee of a municipality or government agency who is informed of, or investigates, a discharge or discovery of a substance.

This is a significant expansion of the scope of the duty to reporter from the EMPA’s predecessor legislation.

Second, responsibility for an environmentally impacted site may now be transferred by a person responsible to another person if:

(a) the other person has agreed to accept responsibility for the environmentally impacted site;

(b) a site assessment has been conducted;

(c) a corrective action plan has been prepared;

(d) an estimate of the costs to carry out the corrective action plan has been prepared;

(e) the other person has agreed to undertake the corrective action plan within the time frame contemplated in the corrective action plan; and

(f) the other person has provided the minister with a financial assurance in the amount and in the form acceptable to the minister equal to:

(i) the anticipated costs of reclaiming the site; and

(ii) an additional contingency amount.

As a result, when land transactions are being contemplated between parties in Saskatchewan, the parties should be cognizant of these new changes, and turn their minds to both the duty to report, and to determining whether there ought to be a transfer of responsibility for any environmentally impacted site.

James Early

The Person Aggrieved vs. The Busybody | Standing When Challenging Decisions

In 2014, the British Columbia Supreme Court was asked (in Gagne v British Columbia, 2014 CarswellBC 3312, 2014 BCSC 2077), once again, to rule on the issue of “standing”.

Standing, from the Latin locus standi, determines whether a person has the right to bring a legal action. That person has to be sufficiently effected or harmed by an action or law in order to bring an legal claim. That person should not, however, be a “busybody”.

First, some background. On April 23, 2013, the Director of the Northern Region of the B.C. Ministry of Environment (the “Director”), granted an amendment to a multi-media permit, which increased the allowable daily emission of sulphur dioxide from 27 tonnes per day to 42 tonnes per day from an aluminum smelter operated by Rio Tinto Alcan (“Rio Tinto”) in Kitimat, B.C. This amendment was authorized in connection with Rio Tinto’s modernization of its Kitimat smelter.

This amendment was challenged by six individuals, the Skeena Wild Conservation Trust (the “Trust”), and the Lakelse Watershed Stewards Society (the “Society”). Two residents of Kitimat, B.C., were granted standing by the Environmental Appeal Board (the “Board”). Of those denied standing, four (including the Trust and the Society) petitioned the British Columbia Supreme Court for an order directing the board to grant them standing.

Ultimately, the British Columbia Supreme Court set aside the Board’s decision and directed the Board to reconsider whether the petitioners were “persons aggrieved”.

The Court found:

– that there was no doubt that the amount of sulphur dioxide emitted into the atmosphere was subjectively of significant importance the petitioners, and indeed the public in general;

– that the Trust and the Society “cannot be summarily excluded from the possibility of being a person aggrieved on the basis that they are not persons”.

– the burden on an applicant when applying for standing must only involve demonstrating to a prima facie (“at first sight”) standard that they are a person aggrieved, not a “balance of probabilities”. Note: a prima facie standard is lower, and therefore easier to achieve, than a balance of probabilities.

– a person aggrieved must demonstrate some form of prejudice to their individual interest, albeit only on a prima facie basis.

In addition to its comments on “persons aggrieved” and the test for determining standing, the Court also determined that the Board must rigorously comply with its own procedure manual. It did so because it found that, following the conclusion of written submissions in relation to the standing hearing, the Board requested extra records from Rio Tinto in breach of its own procedural manual.

Despite the fact that it was evident that the Board and Rio Tinto had acted in good faith throughout the “standing” proceeding, the Board’s breach of its own procedural manual had seriously breached the petitioners’ right to procedural fairness.

Following on from this decision, the Board then reconsidered the petitioners’ application for standing. The Board first noted that the test to establish standing as a “person aggrieved” is:

– Whether the person has disclosed sufficient information to establish, objectively and on a prima facie basis, that the appealed decision prejudicially affects the person’s interests.

Regardless, however, the Board found that none of the petitioners were “persons aggrieved” and, ultimately, the petitioners efforts were all for naught. The common reason appears to be the Board’s determination that Rio Tinto had provided unchallenged information that, under the Permit amendment, the level of sulphur dioxide emissions was predicted not to exceed BC Provincial Pollution Control Objectives outside of Kitimat and that the petitioners were resident some distance away from Kitimat.

James Early