City Of Kawartha Lakes Loses Fight Over 'Unfair' Oil Spill Clean-Up Order

The Ontario Court of Appeal has ruled that the necessities of spill containment and environmental protection can take precedence over the "polluter pays" principle and the rules of natural justice. In assessing the validity of a Director's clean-up order for a 2009 oil spill in the City of Kawartha Lakes, the Court deemed questions of who was at fault were "irrelevant." The City, which bore no responsibility for the original spill, was ordered to clean up oil that had spread onto municipal lands and threatened to recontaminate nearby Sturgeon Lake.

Since then, the City of Kawartha Lakes has fought a series of legal battles to correct what it considers "a breach of natural justice." While the City did not dispute the jurisdiction of the Ministry to issue such a "no fault" Order, it argued that "the MOE must have regard to principles of fairness, including the 'polluter pays principle', as part of its exercise of discretion to issue such an Order." The City maintained that the MOE should only issue a "no fault" Order in the event that the polluter(s) cannot or will not comply with a fault-based Order. The Appeal Court did not agree. In its decision released May 10, 2013, Justice Goudge writes that,

"Evidence of the fault of others says nothing about how the environment would be protected and the legislative objective served if the Director's order were revoked. Indeed, by inviting the Tribunal into a fault finding exercise, permitting the evidence might even impede answering the question in the timely way required by that legislative objective. (Kawartha Lakes (City) v. Ontario (Environment), 2013 ONCA 310)."

The Ministry had issued a preventative Order under section 157(1) of the Environmental Protection Act to ensure prompt remediation and minimize any adverse effects. The Ministry had already issued a remediation Order on the responsible parties, but the spilled oil had spread onto City property. Therefore, a second Order could rightfully be issued to the City as the party that, "owns or has management and control of an undertaking or a property," even though it bore no fault for the original spill.

The Order against the City was appealed to the Environmental Review Tribunal. However, the ERT refused to consider fault, arguing that the overwhelming purpose of EPA s.157(1) is to protect the environment and that, "questions of ultimate liability, fault and other issues are generally left to arenas other than this tribunal."

On May 28, 2012...