Tag Archives: litigation

BREAKING: Peel Watershed Protected by S.C.C.

BREAKING: The Supreme Court of Canada has ruled in favour of Yukon First Nations in their fight to protect the Peel watershed region. This follows my earlier post of November 4, 2015 following the Yukon Court of Appeal decision. More to follow.

James Early

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

Yukon Court of Appeal Decide on #ProtectPeel Watershed Land Use Plan

The Yukon Court of Appeal (the “Court”) has found that the Yukon Government (“Yukon”) failed to honour the letter and spirit of its treaty obligations with respect to the Land Use Planning Process for the Peel Watershed. The Court also found that Yukon failed to reveal its extensive plan modifications, and failed to provide the requisite details or reasons in support of its general comments on the plan which, ultimately, left Commission ill equipped to advance the Land Use Planning Process.

However, the Court did allow Yukon’s appeal, in part.

First, a quick recap

As I wrote on here in February, 2014, on December 2, 2009 a Recommended Peel Watershed Regional Use Plan (the “Plan”) was submitted to Yukon by the Peel Watershed Regional Planning Commission (the “Commission”). In the Plan, the Commission recommended that 80.6% of the Peel Watershed be given a high degree of protection as designated Special Management Areas. Those areas included heritage management, fish and wildlife management, watershed management and general environmental protection.

Following a series of consultations, and following some proposed modifications by Yukon, a Final Recommended Plan was released by the Commission on July 22, 2011, which designated approximately 80% of the Peel Watershed as “Conservation Area”. Approximately two-thirds of the Conservation Area were designated Special Management Areas, and the remaining portions were designated Wilderness Areas.

Following the Commission’s Final Recommended Plan, Yukon commenced a consultation process that lasted into February, 2013.

Ultimately, on January 20, 2014, Yukon announced its approval of a regional land use plan (the “Land Use Plan”). It was vastly different to the Final Recommended Plan. Instead of protecting close to 80% of the Peel Watershed, the Land Use Plan, in fact, leaves about 71% of the Peel Watershed unprotected.

Legislative Background

The Land Use Plan was being created as part of a consultation framework, which included the following provisions:

“11.6.2 Government, after Consultation with any affected Yukon First Nation and any affected Yukon community, shall approve, reject or propose modifications to that part of the recommended regional land use plan applying on Non-Settlement Land.

11.6.3 If Government rejects or proposes modifications to the recommended plan, it shall forward either the proposed modifications with written reasons, or written reasons for rejecting the recommended plan to the Regional Land Use Planning Commission, and thereupon:

11.6.3.1 the Regional Land Use Planning Commission shall reconsider the plan and make a final recommendation for a regional land use plan to Government, with written reasons; and

11.6.3.2 Government shall then approve, reject or modify that part of the plan recommended under 11.6.3.1 applying on Non-Settlement Land, after Consultation with any affected Yukon First Nation and any affected Yukon community.”

These sections have proved to be the main issues in this litigation.

Remedy Sought, Trial Decision

Because of the alleged breaches by Yukon, the Plaintiffs had asked for a declaration that the (unmodified) Final Recommended Plan was the final, binding land use plan for the Peel Watershed. However, at trial, the plaintiffs scaled back their request and sought an order quashing Yukon’s Final Plan and remitting the process to s.11.6.3.2 for Yukon to make its final modifications.

The Plaintiffs were successful at trial and obtained the scaled back remedy that they had sought.

Appeal

Yukon appealed on two main grounds: first that it had not breached Yukon First Nation Final Agreements (“Final Agreements”); and second, if it had breached the Final Agreements, the land use planning process should have been returned to the 11.6.2 stage, and not the 11.6.3.2 stage.

Yukon succeeded on its latter argument. It argued that it is an established principle that a breaching party should be put in the position it occupied prior to its breach, so it can “perform constitutionally what the court deemed to be unconstitutional”. In other words, if the Development and Access Modifications (proposed by Yukon under s. 11.6.2) were invalid, Yukon should be returned to s. 11.6.2 so it can articulate its priorities in a valid manner.

The Plaintiffs argued, in response, that the process should be remitted to the point of Yukon’s breach, which was not s. 11.6.2 but s. 11.6.3.2. To that end, the Plaintiffs argued that three of Yukon’s Modifications under s. 11.6.2 were valid. Although the Development and Access Modifications were invalid, that does not mean they breached the treaty; it means only that they had no effect, and in particular that they could not later be imposed over the objections of the First Nations under s. 11.6.3.2. Accordingly, the Plaintiffs argued, Yukon’s breach occurred at s. 11.6.3.2 (when Yukon imposed an entirely new plan) rather than at s. 11.6.2. Remitting the process to s. 11.6.2 would repeat stages of the process that had been lawfully conducted. The plaintiffs submitted that it was inconsistent with the honour of the Crown for Yukon to argue that it should be permitted to reconsider the proposals it made years ago in December 2009.

Despite the Plaintiffs arguments, the Court found that the appropriate remedy for Yukon’s failure to honour the process was to return the parties to the point at which the failure began. The Court found that it was Yukon’s failure to properly exercise its right to provide modifications that derailed the dialogue essential to reconciliation as envisioned in the Final Agreements. This derailment of the dialogue was where Yukon’s failure began, and marks the point to which the process has now been returned. That point is s. 11.6.2.

So, what does this mean?

The trial judge had remitted the process to the stage of s. 11.6.3.2 for Yukon to consult and then make its final modifications to the Final Recommended Plan. The trial judge had ordered that Yukon’s final modifications had to be based upon the original response that Yukon had made pursuant to s. 11.6.2. The trial judge reasoned that remitting the process to the stage of s. 11.6.2 would take the Commission “back to the drawing board” and permit Yukon “to benefit from its flawed process”. It would amount to an endorsement of Yukon’s treaty breaching conduct.

The Court of Appeal, however, disagreed with these sentiments. First, the Court found, remitting the matter to the s. 11.6.2 stage would not permit Yukon “to benefit from its flawed process”; it would allow the process to unfold as it was meant to.

Second, the Court restated that the matter should be returned to the point of the breach. The trial judge found the breach to be at the stage of s. 11.6.3.2 when Yukon proposed a wholly new plan not based upon modifications it proposed at the stage of s. 11.6.2. However, the Court disagreed. It found that this was “a selective view of matters”. A more compelling argument, it found, could be made in support of the submission that the “breach” began when Yukon did not properly set out its detailed modifications at the stage of s. 11.6.2. That, the Court found, was the the status quo ante, or state that existed before the breach, to which the “breaching” party should be returned to allow it to perform its duties appropriately.

The Court added that it is a status quo ante which best serves the goals of achieving reconciliation as the remedy crafted by the trial judge would put in place a plan that emerged from a flawed process, which does not serve reconciliation.

In practical terms, therefore, rather than the Yukon being simply able to approve, modify or reject that part of the Land Use Plan that was recommended pursuant to 11.6.3.1, it can instead return to 11.6.2 to undertake more consultation with Yukon First Nations and approve, reject or propose modifications to the land use plan as a whole.

Essentially, the Court has rewound the clock six years and given Yukon another chance to attempt to significantly water down the protections that the Peel Watershed would have benefited from under the Final Recommended Plan.

It remains to be seen whether any further appeals (to the Supreme Court of Canada) will be filed, or whether all parties will return to December 2, 2009 and re-do the last several years of consultations and modifications.

One thing remains clear, however, the Court reaffirmed that Yukon failed to honour the letter and spirit of its treaty obligations with its First Nations people with respect to the Land Use Planning Process for the Peel Watershed. Further, Yukon’s own plan, which would have protected less than 30% of the Peel Watershed from development, remains quashed.

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

Wind Power Gets Go-Ahead in Ontario

Yesterday the Ontario Superior Court of Justice dismissed the appeals of a group of residents who lived close to proposed wind turbines, paving the way for those turbines to be built: Dixon v Director, Ministry of the Environment, 2014 ONSC 7404 (CanLII).

The residents had argued that the turbines would cause serious harm to human health if constructed, and suggested that prior hearings before prior Tribunals were procedurally unfair.

A number of ‘grounds of appeal’ were argued, including suggestions that: the “harm” test contained in the Environmental Protection Act violated the Charter; the Tribunals erred in their treatment of the “post-wind turbine witnesses”;  the Tribunals erred in finding that they lacked jurisdiction to assess whether a Director’s decision, or the process in making a decision, is Charter compliant; and the Tribunals failed to follow the principles of fairness or natural justice. On each ground, the residents failed.

To view the decision in its entirety, click here.

James Early