The Future Of Toxic Torts In Canada: The Impact Of Smith v. Inco Limited

The recent Ontario Court of Appeal decision in Smith v. Inco Limited has established new, narrower standards for the environmental torts of private nuisance and strict liability (known as the Rylands v. Fletcher rule). Class actions for environmental damage have been widely used in the United States as a mechanism for addressing (often) historical contamination originating with one common source. Canada, however, has been slower to pursue such remedies. As one of the first major environmental class actions in Canada, this is a significant decision and the plaintiffs have applied for leave to appeal to the Supreme Court of Canada.

Background

This class action involves the owners of approximately 7,000 properties near the Inco Limited. ("Inco") nickel refinery in Port Colborne, which operated between 1918 and 1984. Over this period, nickel particulate was released from the refinery and landed on the surrounding properties. It was never alleged that the level of particulate emissions from the refinery ever exceeded regulatory standards, and Inco accepted responsibility for the presence of nickel particulate on the properties near the refinery.

In 2000, some concern developed over the potential health impacts of the nickel contamination on the properties. In 2002, the Ministry of the Environment ordered Inco to remediate 25 properties where concentrations were particularly high. Inco remediated 24 of these properties. The remaining property belonged to the representative plaintiff, who refused to allow the remediation. As a result of these occurrences, it was originally alleged that the particulate posed a threat to human health. Prior to trial, however, the plaintiffs abandoned this claim and no evidence was led that there were any health risks associated with the nickel. Rather, the only damages claimed resulted from an allegation that the value of the class' property was less than it would otherwise be because of the stigma associated with the presence of nickel residue, even if it was not harmful. Environmental tort claims of this nature are unusual, as diminution in property value often accompanies claims for other losses, such as the cost of remediating the property or bringing it into compliance with government standards.

The Trial Decision

Although the trial judge rejected the plaintiffs' claims for trespass (because Inco had not physically entered the property) and public nuisance (because no public right was interfered with), he accepted the claims for strict liability and private nuisance.

Private Nuisance

A tort claim for private nuisance results from an unreasonable interference with the use and enjoyment of another person's land or interest in land. The trial decision in Smith v. Inco follows the line of many prior nuisance cases that have considered environmental...