Exploring the Viability of Environmental Class Actions in the Historical Contamination Context: Death of the Historical Contamination Class Action?

Transcription

1 Exploring the Viability of Environmental Class Actions in the Historical Contamination Context: Death of the Historical Contamination Class Action? By: Mandy Kinzel and Howard Kohn** Forbes Chochla LLP The Commons Institute 240 Minutes on Environmental Law February 27, 2015

2 Introduction When Ontario s Class Proceedings Act 1 was passed in 1993, it was predicted the new procedural tool would have a tremendous impact on environmental litigation, especially in circumstances of mass injury. 2 A decade after its passage, prospective litigants were once again encouraged by the trilogy of certification cases 3 at the Supreme Court of Canada when the Court pronounced that environmental claims would be well suited to class proceedings. In the trilogy, McLachlin C.J.C specifically recognized that addressing environmental wrongs was one consideration underlying the enactment of class proceedings legislation, to ensure that the courts had a procedural tool sufficiently refined to allow them to deal efficiently, and on a principled rather than ad hoc basis, with the increasingly complicated cases of the modern era. These words are ringing hollow considering the development, or lack thereof, of environmental class actions over the recent years. In the more than two decades since the CPA has been in force in Ontario, only a trickle of environmental class proceedings have been certified and, nation-wide, only one has proceeded to trial on the common issues, albeit unsuccessfully. With the unfavorable outcome of Smith v Inco 4 at the Ontario Court of Appeal, the tide has turned in favor of environmental class action defendants, particularly with regard to those matters involving historical contamination. **Mandy Kinzel is a Student-at-law with Forbes Chochla LLP who has a keen interest in environmental law litigation. This paper was drafted for the Commons Institute, 240 Minutes on Environmental Law (27 February 2015) and presented by Howard Kohn a partner at Forbes Chochla LLP. Mr. Kohn is designated as a Certified Specialist, Environmental Law by the Law Society of Upper Canada. Mr. Kohn exclusively practices litigation with an emphasis on environmental claims. In the past, Mr. Kohn acted as counsel to the Environmental Compensation Corp. and to the Ontario Claims Board which responded to claims arising out of the Hagersville Tire Fire. Mr. Kohn is also a principle author of the textbook "Environmental Harm: Civil Actions and Compensation" , SO 1992, c 6 [CPA]. 2 N.J. Smitheman, Environmental Litigation: In a Class of its Own (Toronto: LSUC Continuing Legal Education) (14 April 1992) at H-1. 3 Western Canadian Shopping Centres Inc v Dutton, [2001] 2 SCR 534 [Dutton]; Hollick v Metropolitan Toronto (Municipality), [2001] 3 SCR 158 [Hollick]; Rumley v British Columbia, [2001] 3 SCR 184 [Rumley] ONCA 628, 2011 CarswellOnt [Inco- ONCA], leave to appeal to SCC dismissed. 2

3 Given the hard line the provincial appellate courts took with Inco and subsequently with Canada (Attorney General) v MacQueen, 5 and Windsor v Canadian Pacific Railway Ltd., 6 in addition to the refusal of the Supreme Court of Canada to hear any further appeals, the historical tests for nuisance and strict liability (Rylands v Fletcher) have been further entrenched in Canadian common law jurisprudence. The judiciary has sent a clear message: the future is bleak for plaintiff-driven environmental class actions related to historical contamination. The best that commentators can offer prospective litigants is encouragement to approach the problem from a fresh perspective. In exploring this possibility, the question arises whether innovative arguments can be made within the boundaries set in Inco by using an overlooked cause of action. Legislation Ontario's Class Proceedings Act was proclaimed in force on January 1, The legislation is intended to aid in complex litigation matters and to determine common issues shared by a group of individuals. The purpose is threefold: 7 to ensure judicial economy by avoiding duplication of individual cases; to enhance access to justice by providing a procedural tool to advance litigation that would otherwise be too costly; and to promote behaviour modification where those who have caused harm are held accountable for their conduct. Certification The main barrier to successful class actions is the certification procedure where the motions court performs a gatekeeper role. To be certified, the plaintiff must meet all five categories of certification criteria: 8 a sustainable cause of action; the cause of action is shared by an identifiable class of claimants; there are common issues of fact or law to be resolved; NSCA 143, 46 CPC (7 th ) 280 [MacQueen], leave to appeal to the SCC dismissed January Also known as MacQueen v. Sydney Steel Corp or colloquially as the Sydney Tar Ponds ABCA 108 (CanLII) [Windsor]. 7 Janet Walker et al., Class Actions in Canada, Cases Notes and Materials (Toronto: Edmond Montgomery Publications, 2014) at CPA, supra note 1 at section 5. 3

4 the class action is the preferable procedure for resolution of the common issues; the proposed representative plaintiff can adequately represent the interests of the class. Certification of environmental class actions has faltered most particularly with concerns in the common issues and preferential procedure requirements as seen in Hollick 9 and again years later in Inco. Summary of Smith v Inco As the first common law environmental class action trial in Canada, Smith v Inco received much publicity and many people hoped it would be the first of similar environmental class actions against corporate polluters. The hard-fought, eleven year long process ended in a dismissal of the action and a substantial costs award to the defendant. 10 In the end, several tough lessons were learned regarding the significant challenges of certifying a class and winning an environmental class action trial. Residents of Port Colborne lived next to a refinery which Inco operated from 1918 to 1984 and admittedly emitted nickel oxide into the air. Around August 2000, high concentrations of nickel particles were discovered in the soil that affected over 7,000 residents. The plaintiffs brought an action in personal injury and to recover damages to their allegedly devalued property. The class relied on three common law causes of action: trespass, strict liability (Rylands v. Fletcher) and private nuisance. During the certification trial, 11 the Court rejected claims related to personal health concerns, due to lack of evidence, as well; counsel discarded the trespass cause of 9 Hollick, supra note 3 at paras The SCC held that as a Small Claims Trust Fund was already structured to compensate the proposed plaintiffs, a class action no longer met the test of preferential procedure. In Hollick, 30,000 residents living within miles of a landfill site brought an action based on an allegation that the toxic fumes and noise pollution of the site interfered with the use and enjoyment of their properties. The action was certified by the motions court, overturned on appeal which was upheld by the SCC. The proposed action did not meet the preferable procedure requirement and the individual issues overwhelmed the common issues. 10 The award amounted to $1.76 million, see: Smith v Inco Ltd., 2013 ONCA 724 [Inco- cost award]. 11 Due to the claims requiring individualized causal inquiries. See Pearson v Inco Ltd., 2002 CarswellOnt 2446, 33 CPC 95 th ) 264 (Ont.SCJ) [Inco- trial on certification]. 4

5 action. After abandoning the personal injury claim at the ONCA appeal on certification, 12 the plaintiffs were successful in certifying the class as the action was sufficiently narrowed. 13 The case was limited to claims that the nickel in the soil reduced the value of the plaintiffs homes. The plaintiffs continued to rely on strict liability and nuisance at trial. The trial on the common issues took place in 2010, where the plaintiffs were successful on both nuisance and strict liability and awarded $36 million. 14 On essentially every ground, a unanimous Court of Appeal reversed the trial court decision. 15 It found there was no actionable nuisance, and Inco was not liable under Rylands v. Fletcher. Nuisance The claim of nuisance faltered because the residents only argued the physical injury to their property was the diminution in the lands value. Interestingly, the landowners never claimed the nickel particles in the soil interfered with the use or enjoyment of their property, but only that the presence of nickel was physical injury to their property, translating to alleged lower property values. 16 It was not enough to show the soil had changed due to the acts of the defendant; the class had to prove this change was substantial and detrimental, rendering property less useful or injurious to health. The Court found no evidence in support of the claim and rejected the expert evidence regarding property values. Further, the Court opined that if property values were affected, it was likely due to fears raised by the class action. 12 Pearson v Inco Ltd., [2005] OJ No. 4918, 78, OR (3d) 641 (CA) [Inco- ONCA on certification]. Class counsel dropped the contentious matters of personal health damages in order to achieve certification, albeit much more narrowed. 13 The Court of Appeal was clear that one of the very reasons it decided to overturn the decision below and to certify the action was because the plaintiff no longer advanced sweeping claims for damages from the alleged adverse health effects from nickel oxide contamination. However, when the case returned to the ONCA on the appeal from the trial of common issues, the same court found that the class could not make out its claim in nuisance because it was incumbent on the claimants to show that the nickel particles caused actual harm to the health of the claimants or at least posed some realistic risk of actual harm to their health and wellbeing. Ironically, the underpinning of the certification order (lack of personal injury to health claims) was found to negate liability on the merits of the action. 14 Smith v Inco Ltd, 2010 ONSC 3790 [Inco- liability trial]. 15 Inco- ONCA, supra note The harm related to the negative effect on property values as matched to the community of Welland, Ontario which was used as a comparative. The difference of 4.3% in appreciation rates over ten years between Welland and Port Colborne calculated at trial was within the range of variance to be expected in comparable communities. 5

6 Strict Liability The trial judge s analysis of Rylands v Fletcher 17 was extensively reviewed. The ONCA held its application must be restricted to a narrow class of cases, where there is a catastrophic escape of something non-natural into a neighboring property, not all types of pollution were applicable. The nickel particle emissions could not be considered to have escaped from the Inco refinery as they were an integral part of refinery operations and were released intentionally on a daily basis for years. The refinery operations and emissions were not extra-hazardous activities. They did not present an abnormal risk to neighbours, and this was considered to be a natural use of Inco s property. Inco had not operated its refinery negligently or unlawfully. It complied with environmental and governmental regulatory schemes applicable to the refinery s operation. The emissions did not contravene any laws. The actual physical impact only became material more than 15 years after the refinery closed when public anxiety negatively affected the property values. The Court of Appeal found strict liability did not apply to the facts. Corporate defendants were encouraged by the ONCA outcome. Many new lessons were learned for both plaintiffs and defendants: 18 Emissions and deposits on land must be clearly shown to be harmful in some tangible way in order to win damages. A chemical alteration in the content of soil may not amount to physical harm or damage to the property. It may be hard to win devaluation of property lawsuits in Canada without strong evidence and data sets must be accurate and complete. Businesses that exceed government guidelines for emissions do not face automatic civil liability. Finally, factories and refineries, especially those that operate in the community for many years, may not be inherently dangerous nor are they considered to be making non-natural uses of their property. 17 (1866), L.R. 7 Ex. 265 (Eng Exch.); affirmed [1868] L.R. 3 H.L. 330 (UKHL). 18 Peter Bowal, Nickel Shower: An Environmental Class Action Law Now (28 February 2013) online: < 6

7 Decisions Post-Inco This significant blow to historical contamination class actions coincided with two actions which were already proceeding with certification efforts. Both were unsuccessful. In Canada (Attorney General) v MacQueen, 19 the Nova Scotia Court of Appeal overturned the lower court s certification of an action brought against Nova Scotia and the Government of Canada. The plaintiffs alleged that emissions from the operation of the defendant s steel plants and coke ovens were hazardous, caused damage to and interference with their property rights and to the integrity of their persons. The causes of action were nuisance, battery, negligent battery, negligence, breach of fiduciary duty and strict liability. The Court of Appeal held that trespass, battery, negligent battery and strict liability did not disclose a cause of action and could not be certified. 20 There was a cause of action in nuisance, negligence and breach of fiduciary duties; 21 however, these claims failed the common issues requirement for certification. The NSCA cited Inco with regards to strict liability by holding that the release of the contaminants was an ordinary and natural by-product of the lawful operation of the steel mill and coke ovens. The concept of escape was not met as the release of the contaminants was intentional. Regarding nuisance, the NSCA held that each class member required an individual inquiry into the nuisance claim and therefore failed the common issues certification requirement. The NSCA held that unlike negligence claims where negligence can be ascertained globally then applied to individuals afterwards, 22 7 a plaintiff can only establish nuisance by proving their individual property was damaged in a substantial and unreasonable way. Liability then becomes an individual issue, not appropriate for the class action regime. 19 MacQueen, supra note Ibid. at para Ibid. at paras See Cloud v. Canada (Attorney General), 2004 CarswellOnt 5026, 73 O.R. (3d) 401 (Ont. C.A.). The 2006 settled matter ($3 billion) pan-canadian action of all Indian Residential Schools in Canada held that the duty of care, standard of care and breach can be made out globally and damages assessed and awarded individually. Individual damages were not a bar to certification.

8 In the post-inco Alberta case of Windsor v Canadian Pacific Railway Ltd., 23 the plaintiff landowners were certified in an action against the CPR for diminution of property values and losses of rental income caused by a degreasing solvent the CPR used in its locomotive repair shops from the 1950 s to 1980 s. In 1999, it was found that the chemical had leaked into the groundwater. The action was based in negligence, trespass, nuisance and strict liability. 24 At certification, the plaintiff s conceded to the dismissal of the trespass. The defendants brought a summary judgment motion to strike out the nuisance and strict liability claims. The motions judge declined to dismiss the strict liability claim; however, the ABCA allowed CPR s appeal and found the plaintiff s failed to meet the high threshold of the strict liability test. 25 Relying on Inco and MacQueen, the ABCA found that the discharge of the degreasing solvent failed to satisfy the non-natural use and escape requirements of Rylands v Fletcher. There was no extra-hazardous use of the land as CPR used its land as a location to repair locomotives. The concept of escape must include an accident, but here the contaminant s migration was expected. The summary judgment held, dismissing the strict liability cause of action. The nuisance claim was whittled down to only include residential properties that were required to install systems to mitigate the risks to human health. Without the need to mitigate, the contamination was only a mere chemical alteration. This left only a claim in negligence and a narrowed nuisance 26 claim, which are yet to move forward. 23 Windsor, supra note No claim was made regarding personal injury or health concerns. 25 Of importance here was the ABCA s use of the recent SCC decision for summary judgement in Hryniak v. Mauldin, 2014 SCC properties where the measurable amount of the solvent exceeded Health Canada thresholds. 8

9 On a different note, Michael MacKay v Nova Scotia Power Incorporated, 27 a class action launched just months post-inco, was based on the same common law torts of nuisance, strict liability, trespass and negligence. The action stemmed from the operation of the Trenton Power Plant by NS Power. It emitted Fly-ash onto the lands of class members allegedly causing diminution in property values. Of interest were allegations in the Notice regarding adverse health concerns; however, this was never further developed in the pleadings. Class counsel proceeded with the class action but settled a mass tort claim with 200 individual plaintiffs in 2014, just after filing the class action Notice of Action. The reason cited for the settlement was that there was physical Fly-ash falling on homes; damage was visible and real. 28 This compared to the ineffective pleadings in Smith v. Inco where no damage was proven, only a perception that the alleged contamination resulted in a drop in property values. Although in MacKay contamination was not proven, the plaintiffs most likely would have been able to prove nuisance as there was Fly-ash on cars and homes, interfering with use and enjoyment of property. Why Causes of Action Fail in Historical Contamination Class Actions Almost all historical contamination claims are asserted through negligence, private nuisance, trespass, strict liability or a combination of any or all. Given the findings in Inco, MacQueen and Windsor, it is important to dissect why these causes of action have failed within the class action regime. The ONCA, ABCA, and NSCA have all confirmed the strict liability and nuisance have no application in historical contamination matters. The SCC has supported the appellate courts by refusing to hear a further appeal of both Inco and MacQueen. Rylands v Fletcher Born in 1868, the intention behind Rylands v Fletcher was to prevent interference to a land owner s real property from tortious behavior in the nature of trespass, which was ineffective due to the stringent requirement of intention. The Rule imposes strict 27 See Notice of Action in the Supreme Court of Nova Scotia, No (3 November 2011) [MacKay]. 28 conversation with class counsel for MacKay, Jamie MacGillivray (23 February 2015). 9

10 liability for damages caused to a plaintiff's property and in Canada for personal damages. 29 There are four prerequisites to the operation of the Rule: 30 a "non-natural" or "special" use is made of his land; he brought on to his land something that was likely to do mischief if it escaped; the substance in question in fact escaped; and damage was caused to the plaintiff's property as a result of the escape. What has occurred since the 19 th Century is the exponential impact of industry on real property and human health. The tangible intrusions have moved to intangibles. Certain industrial activities have become so commonplace they are no longer non-natural uses of property. The discretionary government thresholds (eg. unreasonable and substantial etc.) have not kept up with scientific advancements and understandings of how commercial activities affect the enjoyment, use and interference with property. 31 Presently, the courts have considered and repetitively rejected the arguments that seek to expand the Rylands v Fletcher doctrine. In each case, the courts interpreted the doctrine in a restrictive fashion indicating it does not apply to inherently dangerous activities. The extraction and harvest of natural resources are considered to be natural uses of the land, as long as acts are performed lawfully. 32 Nuisance A person is liable for the tort of private nuisance where they cause, create or contribute to an unreasonable interference with, or resulting in injury to, another person s land. 33 The elements have often been expressed in terms of a two-part test: the interference with the owner s use or enjoyment of land must be both substantial and unreasonable Inco ONCA, supra note 4 at para Ibid at para 71, citing The Law of Nuisance in Canada (Markham, Ont.: LexisNexis Canada, 2010) at p Gatlin Smeijers, Much ado about nothing or a comedy of errors: The post-smith v Inco environmental tort landscape (October 2014) online: Gowlings < pubid =3767> 32 Peter Bowal, Environmental Class Actions for Historical Contamination: Smith v Inco Limited (2013) 24 J. Env L. & Prac. 295 at page Canadian Tire Real Estate Ltd. v. Huron Concrete Supply Ltd., 2014 ONSC 288 (S.C.J.) at para. 12 [Canadian Tire]. 34 Antrim Truck Centre Ltd. V Ontario (Transportation), 2013 SCC 13 [Antrim]. 10

11 The Courts have repeatedly restricted the law of nuisance by requiring direct, material interference or real risk of harm to human health. This renders it applicable only in exceptional environmental contamination cases. 35 The analysis assumes there is no generic threshold at which liability can be established. This was highlighted in Windsor where the court dismissed all nuisance claims where contamination levels did not require mitigation. The mere identification of a contaminant on property was insufficient to meet the physical harm or damage requirement, it must be detrimental. 36 In nonhistorical contamination cases, class counsel has found some success moving a nuisance action forward. 37 However, the strong statements in MacQueen and Paron v Alberta (Minister of Environmental Protection) 38 succinctly explain that nuisance cases are problematic for certification of a common issue because liability is dependent on the impact of the nuisance on each individual and his or her property. Consequently the result of a trial for any one claimant cannot generally stand as proof of the cause of action for any other claimant. 39 Negligence Negligence is frequently dismissed at certification given the individualized duty and standard of care analysis owed to each class member. It is dependent on when the class member owned the property and when the alleged exposure took place. Here, continuously changing environmental standards and practices have made it nearly impossible for expert data to meet all facets of the stringent negligence test, particularly in a historical contamination matter Inco-ONCA, supra note 4 at para Ibid at para See the certification of Cotter v Levy, [2000] OJ No (Ont SCJ) certification granted for class of person in relation to personal injury and property-based claims involving air and water pollution arising from a large fire at a plastics recycling facility ABQB 375 (CanLII). A class action related to pollution attributed to TransAlta Utilities Corporation s Lakeshore electrical generating plant, affecting the Lake level. This interfered with their riparian and littoral rights, and caused lost enjoyment and value of their properties. Their specific complaints include: (a) excessive weed growth, (b) poor water quality, (c) unstable winter ice, (d) declined water levels, (e) air quality, (f) reduced water well yield, and (g) unpleasant odours. Action was not certified. 39 Ibid. at para The opposite has been seen with environmental class actions involving one-off incidents as seen in Durling v. Sunrise Propane Energy Group Inc., 2013 ONSC 5830 (CanLII) regarding a series of explosions at a propane handling facility in the city of Toronto. The explosions caused several massive fireballs to be released into the air and over 11

12 Trespass Trespass is often dismissed at certification. The tort of trespass refers to an intentional, unauthorized physical act that results in a direct and immediate interference to property or rights of another. 41 The directness aspect is most challenging at certification in historical contamination cases as most escapes are considered indirect. This will be addressed further below. Ongoing Environmental Class Actions Considering the outcomes in Inco, MacQueen and Windsor, the future is unclear regarding outstanding environmental class actions. The recent case of Bellefeuille v. Canadian Pacific Railway 42 received permission to convert the individual action to a class action. The historical contamination issue stems from diesel spills by CPR that allegedly contaminated soil and groundwater on properties surrounding the railway s property. The plaintiffs seek damages and rely on the torts of nuisance, strict liability, negligence and negligent misrepresentation. There has been no movement on this action since the leave for conversion to a class action was granted. The action is not yet certified. Equally concerning is the future course of action of Plaunt v Renfrew Power Generation Inc. 43 The plaintiff owners of cottage properties claim trespass regarding the damming of a lake as water encroaches on their property. Renfrew Power operated under a Licence of Occupation from 1917 which permitted the dam to raise water levels of the lake and flood lands to a specified elevation. The plaintiffs provided 17 instances where water exceeded the permitted level. The plaintiffs claim the defendant intentionally and continuously trespassed on their land over the years since 1917, which caused water erosion and damage to property. The plaintiffs successfully met the requirements necessary to certify the action on a limited, unique common issue - declaratory relief the surrounding neighbourhood. People were injured and property was damaged. Action is against the landlords of the (Tesky) Sunrise property. Certified May 2012; however, the actions in nuisance, strict liability and negligence failed. Only negligence was certified. 41 Esso Petroleum Co. v Southport Corp., [1954] 2 QB 182(CA) ONSC 2648 (CanLII) ONSC

13 determining whether the Licence of Occupation created a legal boundary in Plaintiffs counsel indicated the common issues are headed to trial, although no trial date is set. The 2014 Notice of Application in Raymond Baker v Gordon James Rendle et al. 44 brings a case against a variety of businesses operating a composting facility. The class members argue the odours and noise constitute nuisance and have caused unreasonable and substantial interference with the class members and the use or enjoyment of the lands upon which they reside. The matter has not yet been certified. Other environmental class actions continue to move forward; however, none are historical contamination matters and most stem from one-off environmental catastrophes, which often pass the muster of certification. 45 Future Prospects: With the above ongoing actions in mind, environmental class actions are heeded to proceed with caution. Plaintiff-side counsel continues to reel as one after another, appellate-level decisions support the holdings of Inco. Given the past four years of jurisprudence, it is tempting to declare that historical contamination class actions are dead. While many commentators have held the Inco decision has eviscerated the common law principles relied upon in environmental lawsuits, 46 others offer optimism. 44 See Notice of Application in the Supreme Court of British Columbia No (28 November 2014) [Baker]. 45 See for example: a) Janice Cerra et al v. The Corporation of the City of Thunder Bay (no file number) regarding individuals who owned or occupied property in Thunder Bay on or after May 28, 2012 and who suffered damages or injuries as a result of flooding and sewer back-up. Plaintiffs brought an action in negligence. Certified as a class action by the Court on September 23, 2013 upon the consent of both parties; b) Durling v. Sunrise Propane Energy Group Inc., 2013 ONSC 5830 (CanLII), supra note 32; c) Blair v Toronto Community Housing Corp. [2011] OJ NO (OntSCJ) certification grated for a class of tenants in relation to various claims arising from a fire at an apartment owned by the defendant landlord; d) Ludwig v Ontario Limited et al., [2004] OJ No (OntSCJ) certification grated for a class of residents who were evacuated from an area following a major fire at a polystyrene manufacturing facility. 46 See Peter S. Spiro, A Costly Class Action: the Failed Nuisance Claim in Smith v Inco Ltd The Court (11 March 2014) online: < Andre Durocher and Marisa E. Victor, Environmental Class Actions in Ontario and Quebec: A Tale of Two Solitudes (November 2011) online: Fasken Martineau < Barry Glaspell, Canada: Death of Environmental Class Actions Post-Inco Well 13

14 Hope for Plaintiffs If the class proceeding route is pursued, plaintiffs counsel should not focus solely on certification, instead counsel should remain mindful of what must be pleaded and proven in order to succeed at trial. If the tests in Rylands v Fletcher and nuisance, as currently structured, are severely limited or no longer available in the historical contamination class action context, counsel must seek to expand the scope of other causes of actions or offer creative arguments within the boundaries of Inco. Trespass Revisited Trespass has been abandoned almost instantaneously at certification motions. The hurdle of voluntary and direct intrusion onto the plaintiffs land 47 is overcome often by a defence that the alleged intrusion was indirect, and the cause of action ought to be in nuisance. 48 In the hotly debated holding of the non-class-action matter Canadian Tire Real Estate Ltd. v Huron Concrete Supply Ltd., 49 the use of trespass, inter alia, was successful. Petroleum hydrocarbon contaminants from underground storage tanks on the defendant s lands migrated to Canadian Tire s properties. The successful, imaginative argument asserted the gasoline present on the plaintiff s property continued to be the personal property of the defendant. Continuing trespass crystallizes once a request has been made to remove the object and the defendant fails to do so within a reasonable time. The plaintiffs heavily relied on John G. Fleming in The Law of Torts: 50 If a structure or other object is placed on another s land, not only the initial intrusion but also failure to remove it constitutes an actionable wrong. There is a continuing trespass as long as the object remains [ ]. Likewise, if the chattel was initially placed on the land with the possessor s consent, termination of the licence creates a duty to remove it; and it seems that, according to modern authority, a continuing trespass is committed by failure to do so within a reasonable time. (emphasis added) Maybe Not Quite Yet (2 January 2013) online: BLG < Environmental+Law/Death+Of+Environmental+Class+Actions+PostInco+Well+Maybe+Not+Quite+Yet> 47 See test for trespass, supra note As seen in Inco- ONCA on certification, supra note 12 when Inco moved from the unsuccessful certification trial to successful certification at the ONCA. 49 Canadian Tire, supra note th ed. (Sydney: Law Book, 1992) at pg as cited in the plaintiff s factum of Canadian Tire Real Estate Ltd. v Huron Concrete Supply Ltd., supra note

15 The facts demonstrated the plaintiff repeatedly requested the defendant remove the contaminant, and the defendant failed to move to action. Liability in trespass was found. New Category of Nuisance The common law evolves when creative arguments are accepted by the courts. 51 The judiciary tasked with resolving environmental class actions seems to be struggling to apply historical legal tests to current factual circumstances. Environmental commentators claim that within the tort of nuisance, a novel category of interference, chemical interference, 52 could be argued. The chemical interference category refers to a chemical substance that can be observed or measured on the impugned property, such as emissions from foundries, road salt damaging crops and contaminated water supplies. 53 In the private nuisance test, determining the category 54 of inference is a preliminary matter before inquiring whether the interference is substantial and unreasonable. If this new category had been applied in Inco, it would have allowed the residents to demonstrate there was a physical interference with their property based on the presence of nickel contamination, rather than only relying on property value diminution. 55 In the first stage of the analysis, the chemical interference will be substantial if the presence of a contaminant is beyond background levels 56 and would be considered non-trivial, meeting the first step in the nuisance test. The innovative category allows the presence of contamination to be considered independent of alteration of the land, 51 As seen with the reconceptualising of the law in Carter v Canada (Attorney General)2015 SCC 5. Criminal Code prohibitions on voluntary euthanasia and assisted suicide violate the Canadian Charter of Rights and Freedoms. Trial courts may reconsider settled rulings of higher courts: (1) where a new legal issue is raised; and (2) where there is a change in the circumstances or evidence that fundamentally shifts the parameters of the debate. The argument involved a different legal conception of s. 7 than in prevailing cases. The law had materially advanced. The matrix of legislative and social facts also differed from previous actions. 52 Claire Seaborn, How Smith v Inco Failed: Recognizing the Category of Chemical Interference in Private Nuisance Cases (2013) 26 J. Env. L. & Prac 59 [Seaborn]. 53 Ibid. at Canadian courts have repeatedly stated the categories of private nuisance interest are not closed. Presently the nuisance test allows for noise or vibration interference, odour interference, light interference, temperature interference, and interference with amenity. see Antrim Truck Centre, supra note 34 at 23; British Columbia v Canadian Forest Products Ltd, 2004 SCC Seaborn, supra note 52 at Similar to a noise interference analysis that is substantial because it exceeds background levels for noise. 15

16 the loss of amenity or personal injury. An example of an independent consideration of contamination is seen in Scotland in Magnohard Limited v United Kingdom. 57 Altough not a private nuisance case, the reasoning is transferrable. Beach sand contained radioactive chemicals beyond background levels. The court found the contamination was an injury to land, material enough to give rise to liability under the Nuclear Installations Act, even though there was no risk to human health or an interference with use of the land. The chemical interference was substantial, meeting the first step of the private nuisance test by exhibiting contaminants beyond background levels. In determining the second stage of the analysis, if the chemical interference is reasonable, an investigation will be performed to determine material chemical damage beyond background levels. 58 The materiality is likely where the contamination causes stigma to the property, necessitates environmental investigations and health assessments, limits certain uses of the property or raises concern over present or future risk to human health. 59 Plaintiffs will emphasize the frequency and duration of the chemical interference, especially if it is permanent. Plaintiffs can rely on the long standing Supreme Court of Canada precedent which stated the focus of nuisance is on whether the interference suffered by the claimant is unreasonable, not on whether the nature of the defendant s conduct is unreasonable. 60 This approach is layered with policy considerations which allows for flexibility from the judiciary. By allowing plaintiffs to frame a cause of nuisance based on chemical interference, it permits an expanded approach to the nuisance test. The concern regarding common issues is alleviated. Although property owners may experience varying degrees of contamination, the impact of a chemical interference to soil or water is surely less individualized than a claim based on personal injury or loss of use or enjoyment Mognohard Limited and Others v United Kingdom Atomic Energy Authority and The Scottish Environmental Protection Agency, [2003] CSOH 362, [2004] Env LR The average or expected amount of a substance that occurs naturally or is generally present in the environment. 59 Lynda Collins & Heather McLeod-Kilmurray, The Property Torts, The Canadian Law of Toxic Torts (Carswell: Canada Law Book 2014) as cited in Seaborn, supra note 52 at Antrim, supra note 34 at para Seaborn, supra note 52 at 8. 16

17 Bright Future for Defendants Post-Inco, commentators in favor of defendants offer an optimistic perspective. Defendants can feel secure knowing that only when environmental claims based in strict liability, nuisance, trespass and negligence are whittled down to issues relating to property values or economic damage, have certification decision been upheld by appellate courts, even then, certification is not a predictor of final success. 62 Even if a historical contamination action is certified, there is a limited prospect of success at trial on the common issues. Remarkably, in Inco the ONCA could have commenced the decision by overturning the damage award. The conclusions with regard to damages alone would have been sufficient to overturn the trial judgment. However, the Court said the damage findings were an alternative to its nuisance and strict liability analysis. This ensured the Court s dicta on the issues of nuisance and strict liability would not be regarded as obiter. 63 The Court was very particular to narrow two of the torts most applicable in environmental cases. As a result, it is doubtful whether and to what extent environmental class actions can ultimately pass muster. 64 This was highlighted in both MacQueen and Windsor when the appellate courts applied the narrowed tests provided for in Inco. Corporate defendants can feel more confident if faced with a historical contamination class action when the corporation is well aware they operated their facilities within the boundaries provided in regulations and statute. Now, instead of defendants succumbing to a settlement immediately after certification as often seen in the past, 65 defendants can move confidently to a trial on the common 62 Jennifer Fairfax, Rougher Waters to Come for Environmental Class Actions: Will Class Action Plaintiffs Rage Against the Dying of the Light? Paper presented at the OBA 2015 Institute (4 February 2015) at Managing New Environmental Quagmires- Perspectives from the Litigation, Regulatory and Transactional Contexts at 31 [Fairfax]. 63 Barry Weintraub & Rueter Scargall Bennet, Ontario Court of Appeal Narrows Environmental Torts in Inco Class Action (December 2011), Ontario Bar Association Civil Litigation Section Newsletter, January 2012, online: 64 Fairfax, supra note 62 at Eric Prefontaine & Karin Sachar, Class Action Settlement Negotiations: Timing is Everything (19 February 2015) Canada Class Action Defence, online: Osler < See also Wamboldt v. Northstar Aerospace (Canada) Inc., 2009 CanLII (ON SC) a settled class action regarding contamination of real property. Testing revealed 17

18 issues, where there has been zero success in common law courts. If available on the facts, defence counsel may also move expediently to a summary judgement motion, as was seen in Windsor. Final Notes Prior to 2011, uncertainty and ambiguity were always key challenges for business and industry when it came to defending class actions. The recent three appellate level decisions have paved a clearer path for counsel through the complex legal landscape. The results of Inco, Windsor and MacQueen have placed significant barriers in the way of future historical contamination class actions. Further, given the substantial risks to class actions, such as the $1.7 million cost award in Inco, it is not expected that many of the proposed actions will move forward anytime soon. Plaintiffs must employ untested, innovative arguments (eg chemical interference) or underutilized torts (eg trespass), within the boundaries set by Inco, if they are to continue to pursue the class action regime to address environmental wrongs. Class counsel should be alert to the future outcomes in Plaunt, Bellefeuille, and Baker before considering moving forward with historical contamination environmental class actions. chemicals were present at levels which exceeded environmental guidelines and vapours were infiltrating people s homes. The plaintiffs allege the contamination caused by Northstar resulted in a decrease in property values. 18