As it relates to environmental liability in Ontario, my colleagues and I have, for several years, discussed how to best protect our clients from the creeping environmental liability in the province. For example, two years ago we wrote an article in Environmental Science and Engineering Magazine, “Property owners need to be concerned about clean up liability following the Kawartha Lakes spill.” We called the Kawartha Lakes Decision a potential game changer.
In our November 6th blog (trend on personal liability), we also discussed the increased personal liability in Ontario.
Environmental Commissioner of Ontario Interview
Environmental Commissioner of Ontario, Dianne Saxe, interview on “The Agenda” (Source: http://tvo.org/programs/the-agenda-with-steve-paikin)
Recently appointed Environmental Commissioner of Ontario, Dianne Saxe, also has concerns about this issue of liability for historical environmental contamination. In a recent interview with Steve Paikin on The Agenda, Ms. Saxe said, “The Province has decided that their priority is to have contamination cleaned up at any moral cost, anyone they can force to pay, regardless of fault, they consider that appropriate.” She also said that, “The province of Ontario has gone farther than any other jurisdiction I know in picking innocent people and making them pay.”
Driving Business Out of Ontario?
Ms. Saxe also said this policy, or lack of policy, is not good for business. “What we are doing now is driving investment out of Ontario. When you treat people, innocent people, arbitrarily, very, very harshly, the word gets around. And I personally know of eight figure investments that have walked out of Ontario because of this.”
Rethinking Environmental and Liability Protection
In the United States, the issue of liability has been approached differently. While it is complicated, and I’m certainly not a lawyer, many of the protections for buying potentially “contaminated” land are spelled out in the Superfund Program (the Comprehensive Environmental Response Compensation and Liability Act or CERCLA). In simple terms, when conducting an “environmental due diligence” in compliance with CERCLA, you are afforded liability protection and, by-in-large, you will not be forced by the government to pay to cleanup someone else’s “sins.” Again, it is far more complicated, and if you want details, I can refer you to one of my colleagues in our US office.
Could this (CERCLA) type of policy in Ontario be helpful in avoiding innocent landowners from becoming unnecessarily liable for what are often expensive environmental cleanups and promote Brownfield development? Could this also be helpful in encouraging environmental assessments so we, as a province, have a better handle on where contaminated property may be posing a risk? Finally, could a new policy be helpful in encouraging, rather than discouraging, investments in our province?
Perhaps our lawmakers will consider what the next best steps might be to protect jobs and the environment for all Ontarians. As Ms. Saxe said in the interview, “we need a plan and a policy.”
If you have questions about how you might best protect yourself during a property transaction, including Phase I and Phase II ESAs, feel free to contact me (cpare@dragun.com) at 519-979-7300, ext. 114.