When I talk with my colleagues in our US office, they often comment that the fines for environmental violations seem far less severe in Canada than in the US. In fact, earlier this year, the US Environmental Protection Agency substantially increased the potential cost for non-compliance.
However, as I shared with my colleagues, some recent cases in Canada may signal a change in environmental fines, as well as plaintiff awards.
Larger Penalties
The federal Fisheries Act was updated a few years ago to allow for “more monetary teeth” in violations. Maximum fines (within certain parameters) were previously $300,000 but can now reach $4 million.
These new guidelines were used when Canadian National Railway was fined $2.5 million for a spill of diesel fuel in the Saskatchewan River. According to Crown Counsel, Erin Eacott, “… [the] spill was a result of a miscommunication among CN employees, as well as the failure of monitoring systems meant to prevent hydrocarbons from entering waterways.”
Another Fisheries Act fine was announced on June 12, 2017, by Environment and Climate Change Canada (ECCC). According to ECCC, “Prairie Mines & Royalty ULC (formerly known as Coal Valley Resources Inc.) pleaded guilty in Alberta Provincial Court on June 9, 2017, to two counts of violating the Fisheries Act. The Honourable Judge C.D. Gardner sentenced the company to pay monetary penalties totalling $3,500,000.”
This fine related back to a 2013 issue when a dike that was containing
waste water at the Obed Mine failed, and 670 million litres spilled into
nearby creeks.
Environmental Cases and Awards
In July 2014, we discussed a favourable outcome in a court case in Ontario in which Dragun provided environmental technical support. Another case where awards hit seven figures was recently in the news.
This case involved a historical release from a dry-cleaning facility. According to the article in HazMat Management, “In a decision released in March 2017, Huang v Fraser Hillary’s Limited (“Huang“), the Ontario Superior Court of Justice used section 99(2) of the Ontario Environmental Protection Act (“EPA“) to anchor liability and award the plaintiff $1,632,500 in damages for remediation, in addition to $201,726 for expert costs incurred during litigation.”
According to the article, when assessing the damages, the court considered the potential cost of remediation. The remediation options ranged from
$1.2 to $8.7 million.
Industry, in general, is far more conscientious about environmental management practices. But as is typically the case, we are still addressing issues from years past. In the case of the dry cleaner, the issues date back
to 1960.
The penalties for non-compliance in Canada, as in the US, are getting more costly, which puts increased emphasis on using good management practices and training, as well as due diligence, before a purchase and for ongoing operations.
If you need assistance with an environmental matter, or if you have a question about an environmental issue, please feel free to contact me. You can reach me at 519-979-7300, ext. 114.