Environmental Liability in Ontario Steps Backward

Ontario’s environmental industry is still processing a startling decision on a massive property contamination case made earlier this month.

On October 7, 2011 the Ontario Court of Appeal overturned a July 2010 decision by the Ontario Superior Court in Smith vs Inco Limited[1]. The 2010 decision awarded $36,000,000 in damages to 7000 property owners in Port Colborne, Ontario, due to soil contamination caused by nickel particles emitted from Inco’s refinery, over a 66 year period up to 1985. It was speculated that the original July 2010 decision would open the door in Canada (or at least Ontario) to American-style environmental class-action lawsuits popularized in movies like: Erin Brockovich starring Julia Roberts, and Civil Action with John Travolta.

In the Court’s decision it said that the case failed to prove that Inco’s refinery dust negatively impacted the values of the properties or the owner’s ability to use their properties.  The Court also found that the case did not show that the contamination posed a risk to the health or safety of residents.

The implications of this decision are potentially far-reaching when you consider so many industrial activities operate near residential areas.

There are several layers of irony in this story.

1.   Smelting is a “Potentially Contaminating Activity” highlighted by the Ministry of Environment (MOE) earlier this year in amendments to Ontario’s Brownfield legislation, O. Reg 153/04. Legislation that is designed to protect human health and the health of our environment.

2.   The pollutant in question, nickel refinery dust, is considered a human carcinogen by the US EPA, and EPA cites health studies from Port Colborne to support their conclusions! “Evidence of carcinogenicity includes a consistency of findings across different countries (Clydach, Wales; Copper Cliff, Ontario; Port Colborne, Ontario; Kristiansand, Norway; and Huntington, WV)”[2]

Inco (now owned by Vale Ltd.) is however not gloating over what must be viewed as a huge victory. The company's website has no posted announcements on the case.

[1] www.ontariocourts.on.ca/decisions/2011/2011ONCA0628.htm

[2] www.epa.gov/iris/subst/0272.htm

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