“When in Doubt, Report” – the Supreme Court of Canada Broadens the Application of Ontario’s Environmental Protection Act

On October 17, 2013, in Castonguay Blasting Ltd. v. Ontario (Environment), 2013 SCC 52, the Supreme Court of Canada dismissed the appeal of Castonguay Blasting Ltd. (Castonguay) from a decision of the Ontario Court of Appeal upholding a conviction under section 15(1) of the Ontario Environmental Protection Act (EPA) for failing to report the discharge of a contaminant. The company, at every level of court, argued that the discharge of the fly-rock, while causing property damage, was not an environmental event and therefore should not have triggered a requirement to report under the EPA.

Background

In September 2007, Castonguay was subcontracted to conduct rock blasting for the widening of Ontario’s Highway 7 near Marmora, Ontario. On November 26, 2007, a blasting mishap sent rock debris 90 metres into the air and onto an adjacent property. The fly-rock penetrated the roof of a home on the adjacent property, damaging the home’s kitchen ceiling, siding and eavestroughs. The fly-rock also damaged a car’s hood and windshield.

Employees of Castonguay immediately went to the adjacent property to ensure that no one was hurt, and the contract administrator reported the incident to the Ontario Transportation and Labour ministries. The blasting was suspended until the Ministry of Labour, in December 2007, allowed the blasting to recommence. The company compensated the property owners for the damage to their property. However, not one of Castonguay, the Ministry of Labour, the Ministry of Transportation or the main contractor reported the incident to the Ministry of the Environment (MOE).

The MOE eventually learned of the incident in May 2008. In September 2009, the MOE charged Castonguay for failing to report “the discharge of a contaminant into the natural environment” contrary to section 15(1) of the EPA.

Trial History

In June of 2010, the Ontario Court of Justice acquitted Castonguay on the basis that it was inconceivable that the EPA could be interpreted so broadly as to consider the fly-rock incident an “environmental event.” The Court suggested that the discharge of fly-rock could, in some circumstances, be considered an environmental event, if, for example, the rock landed in a watercourse or fish habitat; however, no such circumstances existed in this case.

In January 2011, the Ontario Superior Court of Justice allowed the appeal, entered a conviction and ordered Castonguay to pay the minimum fine of $25,000. The Court concluded that under the EPA, fly-rock is a contaminant, and that it was an error of law to say that the application of the EPA is limited to an environmental event.

In March 2012, a majority of the Ontario Court of Appeal upheld Castonguay’s conviction, with Justice Blair dissenting. Justices MacPherson and Simmons, for the majority, held that under the plain wording of the EPA, the fly-rock incident was the discharge of a contaminant that caused an “adverse effect” (property damage); therefore, the company should have reported the incident. The majority noted that the EPA is concerned with uses of the environment that cause harm to people, animals and property: the direct conduit resulting in the harm was Castonguay’s use of the environment (the air) to disperse a contaminant (fly-rock).

Justice Blair, in dissent, argued that an adverse effect carries with it some element of impairment to the natural environment – in other words, an environmental event is required to trigger the legislation. Justice Blair noted that, while the EPA is important remedial legislation that should be interpreted broadly, it ought not be interpreted in a completely open-ended manner and in a fashion that overreached its intended mandate.

Supreme Court of Canada

The EPA

The Supreme Court of Canada began with a discussion of the EPA, noting that it is to be generously interpreted because of its status as remedial legislation. Additionally, the Court explained that the protection of the environment is a complex subject that cannot be easily regulated. Rather, the legislature intended for the EPA to have a “wide and deep reach” in pursuing the objective of environmental protection. The Court stressed that the EPA protects not only the natural environment (defined in the EPA as “air, land and water, or any combination thereof”), but also those who use the natural environment and their own property.

Discharging a Contaminant and Reporting a Discharge

Section 14(1) of the EPA prohibits the discharge of a contaminant into the natural environment, and section 15(1) requires all persons to notify the Ministry of the Environment if they discharge a contaminant into the natural environment, out of the normal course of events, and the discharge causes or is likely to cause an adverse effect.

The EPA defines an “adverse effect” as follows:

        “adverse effect” means one or more of,

  1. impairment of the quality of the natural environment for any use that can be made of it,
  2. injury or damage to property or to plant or animal life,
  3. harm or material discomfort to any person,
  4. an adverse effect on the health of any person,
  5. impairment of the safety of any person,
  6. rendering any property or plant or animal life unfit for human use,
  7. loss of enjoyment of normal use of property, and
  8. interference with the normal conduct of business. [Emphasis added]

Castonguay argued that for a discharge to be considered to have an adverse effect it must have, as a prerequisite, somehow “impair[ed] the quality of the natural environment.” In other words, the effect of the discharge must have at least been “environmental.”

The Supreme Court disagreed with Castonguay’s interpretation, noting that each of the eight adverse effects listed in the definition were independent of each other and were each individually sufficient to trigger the reporting requirement in section 15(1) of the EPA. In this case, property damage (item “b” of the definition) had occurred as a result of the discharge of a contaminant, so an adverse effect had occurred. It also noted that it could have harmed people if they happened to be present.

When in Doubt, Report

In concluding that each adverse effect acts as an independent trigger to report, the Court pointed out that the purpose of the reporting requirement is to ensure that the MOE is able to quickly inspect the site of discharge and determine whether any remedial steps are required. The Court was concerned that environmental harm, or harm to human health, plants or animals, may be, in some instances, difficult to detect. In the Court’s opinion, a broad approach to the reporting requirement was consistent with the “precautionary principle” (namely, that even in the absence of scientific consensus, environmental policies must anticipate and prevent environmental degradation). In other words, the Supreme Court espoused the view that the MOE ought to be notified and have the ability to respond immediately without waiting for proof that any environmental harm has actually occurred.

The Reporting Requirement Is Already Sufficiently Narrow

The Court was satisfied that the statutory language of section 15(1) of the EPA (i.e., the requirement to report) was restrictive enough in its ambit to avoid being a catch-all concept. First, the EPA applies only to activities that engage the natural environment (the air, land or water in Ontario), thereby maintaining a sufficient nexus with the statutory objective of environmental protection. Second, the requirement that the discharge be “out of the normal course of events” in order to trigger the duty to report would, according to the Court, exclude many everyday routine activities.

The Court felt that it would be undesirable to further narrow the scope of the reporting requirement and diminish the Ministry’s ability to protect the environment. For the Court, it was important that the MOE have every opportunity possible to investigate and remedy environmental harms.

Implications

  1. Vigilance should be increased. Companies will now need to carefully consider whether they must report to the MOE every time there has been a discharge out of the ordinary course of events. They would be wise to heed the Supreme Court’s warning that “when in doubt, report.” It may be important to review internal environmental, health and safety protocols to ensure that discharge risks are identified and that plans are in place in the event of a discharge. Companies may also consider changing their internal record systems to be able to document “discharges” so as to prove what is, and what is not, out of the ordinary course of events.
  2. EPA will be interpreted broadly. The Court’s findings in Castonguay Blasting send clear instructions to lower courts to interpret the EPA in a manner that is consistent with the overarching broad goal of protecting the environment. This may mean that orders issued under the EPA may be even more difficult to challenge so long as there is a solid foundation in the wording or language of the EPA. Ironically, in Castonguay Blasting, the Court interpreted the EPA’s wording literally in order to broaden the statute’s application.
  3. Application of many EPA provisions may be broadened. While the Court was dealing only with the meaning of “discharge of contaminant” in the context of section 15 of the EPA and the definition of “adverse effect,” the Court’s reasoning may have far-reaching implications, broadening the application of other provisions in the EPA. For instance, a broader range of discharges may now be caught under the general pollution prohibition in section 14 of the EPA and under the order provisions in sections 17 and 18, to name a few.
  4. Overlap between EPA and OHSA regimes. Care will need to be taken to determine whether operational accidents, which previously attracted legal scrutiny only under the Occupational Health and Safety Act, also require reporting under the EPA because they involve a discharge of a contaminant.