Ontario Court of Appeal says innocent parties must pay for pollution clean-up

Ontario Court of Appeal says innocent parties must pay for pollution clean-up by Julius Melnitzer, May 14, 2013, Financial Post
The Ontario Ministry of the Environment may order innocent parties who are not responsible for discharging pollution into the environment to remediate contamination which has impacted their properties, says the Ontario Court of Appeal. “Kawartha Lakes confirms that the MOE may turn to innocent landowners when pursuing its ultimate goal of protecting the environment, even if this leads to ‘unfair’ outcomes against innocent parties,” write Daniel Kirby, Jack Coop, Paul Morassutti, Jennifer Fairfax, Lindsay Rauccio and Patrick Welsh writing in Osler, Hoskin & Harcourt’s Osler Update. As we reported previously, the case arose when heating oil migrated onto City property after being spilled at a neighbouring property. ”All parties agreed that the City had nothing to do with the spill,” Kirby said. The MOE initially ordered the neighbours to remediate. The resident’s insurer commenced remediation in compliance with the order but the pollution continued to spread to the adjacent City land.

The Environmental Review Tribunal upheld the Ministry order against the City requiring it to clean up the spill. It ruled that the City could not get relief from the Order without proferring some evidence of a solution that was also consistent with the purposes of the EPA in the sense of being fair to the environment and those affected by the pollution. Here, the City had failed to do. The Divisional Court upheld the ruling, but did not go so far as to exclude fairness and fault factors from consideration. Rather, it appears to have decided that fault or lack of fault could impact the content of an order, but not whether it should have been made in the first place.

The Court of Appeal upheld the Divisional Court, finding that the primary objective of the Environmental Protection Act took precedence over the polluter-pays principle.

Some environmental lawyers are unhappy with the decision, saying that the ultimate result may be that fewer spills are reported if innocent reporters run the risk of responsibility for the cleanup costs. But the Osler authors don’t necessarily agree. They argue that “all owners now have increased incentive to ensure that environmental conditions on neighbouring properties that might migrate onto their own property are being adequately addressed.” This, they add, could “lead to an increase in neighbour-on-neighbour reporting of spills.“ [Emphasis added]

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