Liability For Oil Spills

In July 2017, Justice Charney released a comprehensive decision following a lengthy trial in Gendron v. Thompson Fuels, 2017 ONSC 4009. The case arose out of a residential oil leak in which over $2 million in damages was claimed.

Brian Sunohara and Meryl Rodrigues of Rogers Partners LLP were trial counsel for the oil tank manufacturer, Granby. The plaintiff and Granby entered into a Pierringer Agreement approximately one week into the trial.

The decision emphasizes the importance of homeowners taking responsibility for the equipment at their houses, and also the responsibility of technicians who service equipment to do a competent job and provide advice to homeowners.

The case circumstances also illustrate the benefits associated with partial settlement agreements and the impact of such agreements on the litigation landscape.

Facts

In November 2000, the plaintiff purchased two end-outlet oil tanks that were manufactured by Granby.

Instead of having a qualified technician install the tanks, the plaintiff and a friend installed the tanks in the plaintiff's basement.

In 2001, Thompson Fuels became the plaintiff's fuel oil supplier. Thompson Fuels was supposed to conduct a comprehensive inspection of the tanks to ensure that they were safe to fill. However, this was never done. Thompson Fuels continued to deliver fuel until December 18, 2008 because its computer system incorrectly indicated that an inspection had been conducted on February 27, 2002.

The plaintiff was required to have the oil tanks inspected on an annual basis. Thompson Fuels sent newsletters to its customers to advise of this obligation. There were some service calls by Thompson Fuels in 2006 and 2007, but the plaintiff did not have the required annual inspections.

The oil leak was discovered on December 18, 2008. The oil escaped through a crack in the plaintiff's basement and went under his house. Some of the oil made its way through a drainage system into a municipal culvert and into a lake.

The experts agreed that the cause of the leak was internal corrosion, specifically, microbiologically influenced corrosion. The corrosion was caused by the build-up of water and sludge inside of the tank, which, combined with microbes, resulted in the production of sulphur and organic acids within the tank. The key to preventing internal corrosion is to test for water inside of tanks and to remove any water if found.

Due to the contamination, the plaintiff's house was demolished and a new...