Macqueen Class Action Struck Out Re Sydney Tar Ponds

The Nova Scotia Court of Appeal has struck out the groundbreaking class action that had been certified relating to contamination from the Sydney Tar Ponds and the associated steel and coke plants: MacQueen v. Ispat Sidbec Inc. This is another major setback to plaintiffs in contaminated land cases, following the lead of the Supreme Court of Canada in Smith v Inco.

In the MacQueen class action, landowners and residents of the Sydney, Nova Scotia, Tar Ponds area claim to have suffered substantial health and economic damages as a result of contaminants emitted from the steel and coke works that used to operate in their neighbourhood. They brought a class-action seeking substantial damages and other remedies against the federal and provincial governments, and against the former private sector operators.

"For close to a century, steel was produced in the heart of Sydney, Cape Breton. The steel works which opened in 1903 consisted of two different facilities: (a) a steel plant, and (b) coke ovens where coke was produced for use in the plant. The coke ovens closed in 1998 and the steel plant in 2000. With that closure ended the history of steel-making in industrial Cape Breton."

The steel plant was originally privately owned. It lost a great deal of money, and was scheduled to close in 1967. It was kept going for political reasons by large injections of public funds, which included the federal and provincial governments acquiring ownership and control of the plants. This was done to meet local demands to keep the plants operating, because they were major local employers and customers for local coal mines, the economic engines of Cape Breton.

In particular, the provincially owned Sydney Steel Corporation ("Sysco") operated the steel works from 1967 until its closure in 2000, and operated the coke ovens until their closure in 1998, except for a temporary closure between 1983 and 1985, and except for the six years between 1968 until 1974 when a federal Crown corporation (Devco) owned and operated the coke ovens. Devco, which was created pursuant to the Cape Breton Development Corporation Act, R.S.C., 1967, c. C-6, was dissolved pursuant to the Cape Breton Development Corporation Divestiture Authorization and Dissolution Act, S.C. 2000, c. 23. Its legal successor is the Attorney General of Canada, i.e. all Canadian taxpayers. If Devco had not been dissolved, federal liability might have been limited to its (negligible) assets. (Has anyone been held...