NEW LEGISLATION

Fish Protection Act

The definition of "fish habitat" in section 1(1) and section 12 of the Fish Protection Act, S.B.C. 1997, c. 21, was brought into force by B.C. Reg. 11/2001, effective January 19, 2001. In addition, the definition of "local government" in section 1(1) of the Fish Protection Act came into force on January 19, 2001 in the following regional districts and all municipalities within them: Capital, Central Okanagan, Columbia-Shuswap, Comox-Strathcona, Cowichan Valley, Fraser Valley, Greater Vancouver, Nanaimo, North Okanagan, Okanagan-Similkameen, Powell River, Squamish-Lillooet, Sunshine Coast, Thompson-Nicola; and the trust area under the Islands Trust Act. In addition, a Streamside Protection Regulation was made to protect streamside protection and enhancement areas from residential, commercial and industrial development so that areas can provide natural features, functions and conditions that support fish life and processes.

Forest Amendment Act, 1999

Sections 18(a) and (b) of the Forest Amendment Act, 1999, S.B.C. 1999, c. 10 were brought into force by B.C. Reg. 373/2000, effective November 24, 2000. This allows for the consolidation of existing timber licenses and makes amendments regarding wood lot licenses and timber marks.

Forest Statutes Amendment Act, 1996

Sections 8 and 12 of the Forest Statutes Amendment Act, 1996, S.B.C. 1996, c. 11 came into force on December 18, 2000.

Forest Statutes Amendment Act, 2000

Sections 33, 35, 42(b) and 51 of the Forest Statutes Amendment Act, 2000 S.B.C. 2000 were brought into force by B.C. Reg. 373/2000, effective November 24, 2000. It allows for the consolidation of existing timber licenses and makes amendments regarding wood lot licenses and timber marks.

Section 48 of the act was brought into force by B.C. Reg. 18/2001, effective February 26, 2001. This regulation eliminates logging plans and makes amendments regarding allowable annual cuts.

Regulatory Streamlining Miscellaneous Statutes Amendment Act, 2000

Sections 2, 3-5, 13, 20-34 and 37 came into force on January 1, 2001. Section 39 of the act was brought into force by B.C. Reg. 379/2000 on November 24, 2000. This regulation makes various amendments regarding timber marks, and tax returns, exemptions, penalties and assessment with respect to quarries. This repeals the Mining Tax Act, R.S.B.C. 1996, c. 295.

Tobacco Damages and Health Care Costs Recovery Act

Sections 1 to 11 of the Tobacco Damages and Health Care Costs Recovery Act, S.B.C. 2000, c. 30, were brought into force by B.C. Reg. 11/2001, effective January 24, 2001. This regulation repealed B.C. Reg. 394/98 - Tobacco Damages and Health Care Costs Recovery Regulation. These sections provide for direct action by the government against a manufacturer to recover the cost of health care benefits caused or contributed to by a tobacco related wrong, the recovery of cost of health care benefits on an aggregate basis, joint and several liability in an action against a manufacturer, population based evidence to establish causation and quantify damages or cost, limitation periods, liability based on risk contribution, and the apportionment of tobacco related wrongs.

Wildlife Amendment Act, 1999

Section 9 of the Wildlife Amendment Act, 1999, S.B.C. 1999, c. 24 was brought into force by Reg. 253/2000, effective September 1, 2000. This makes it an offence to feed or intentionally attract dangerous wildlife and makes amendments regarding fines and penalties.

NEW RULES AND REGULATIONS

Angling and Scientific Collection Regulation

B.C. Regulation 20/2001, the Angling and Scientific Collection Regulation, was brought into force pursuant to sections 53 and 108 of the Wildlife Act. This regulation amends B.C. Reg. 125/90. This regulation provides that section 19 of the Angling and Scientific Collection Regulation be amended to include provisions for failing to comply with reporting conditions of an angling guide licence.

Administrative Remedies Regulation

B.C. Reg. 18/2001 was brought into force, amending B.C. Reg. 182/98, Administrative Remedies Regulation, pursuant to the Forest Practices Code of British Columbia Act, effective February 26, 2001. This regulation adds a provision for failure to ensure that a professional engineer or forester has taken design responsibility as required.

Aquaculture Regulation

B.C. Reg. 335/2000 was brought into force, amending B.C. Reg. 364/89, the Aquaculture Regulation, effective October 31, 2000, pursuant to the Fisheries Act.

Community Forest Agreement Regulation

B.C. Reg. 18/2001 was brought into force, amending B.C. Reg. 384/2000, Community Forest Agreement Regulation, pursuant to the Forest Practices Code of British Columbia Act, effective February 26, 2001. This regulation eliminates logging plans and makes various amendments regarding wood lot licenses, allowable annual cuts, and the use of logging roads.

Motor Fuel Tax Regulation

B.C. Reg. 26/2000 was brought into force effective January 1, 2001, amending B.C. Reg. 414/85, the Motor Vehicle Tax Regulation of the Motor Fuel Tax Act.

Water Regulation

B.C. Reg. 293/2000 amends B.C. Reg. 204/88, water regulation, pursuant to the Water Act. The regulation will be effective January 1, 2003.

Wood lot Licence Forest Management Regulation

B.C. Reg. 18/2001 came into force on February 26, 2001. This regulation amends B.C. Reg. 325/98, Wood lot Licence Forest Management Regulation, pursuant to the Forest Practices Code of British Columbia Act. This regulation eliminates logging plans and amends the requirements for obtaining a wood lot license.

Wood Residue Burner and Incinerator Regulation

B.C. Reg. 17/2001 was brought into force, amending B.C. Reg. 519/95, Wood Residue Burner and Incinerator Regulation, pursuant to the Waste Management Act. This results in a change to the definition of a "burner facility operator" and the addition of a list of burner facility operators and locations.

RECENT LITIGATION

A solicitor's breach of the implied term of their contract for services to carry out their retainer with professional care, skill and diligence, breach of duty in tort, and breach of fiduciary duty in failing to conduct an environmental search is not sufficient to support a claim for damages beyond nominal damages in contract if the chance of loss is not more than speculative.

The plaintiff, Fraser Park South Estates Ltd. ("Fraser") purchased real property with the professional advice and assistance of Lang Michener Lawrence & Shaw ("Lang Michener"). The subject matter of the purchase was a 16.4 acre site zoned for single-family housing with a potential for 80 to 90 single-family building lots. The development required subdivision. A Pollution Abatement Order ("PAO") was brought to the attention of a project manager with DSM Construction (1989) Ltd. after the purchase had been completed. Lang Michener conceded that Mr. Knight breached his duty to Fraser in failing to make an environmental search which would have disclosed the PAO before the purchase was closed. The PAO had ordered the vendors to install works and take measures necessary to eliminate the discharge of waste leachate at two locations on the development site. Fraser accepted the business risk of obtaining subdivision approval when it accepted the vendors' couteroffer which deleted subdivision approval as a condition of purchase. Fraser argued that Lang Michener breached its duty in not identifying the PAO. Further, Fraser argued that they would not have purchased the property had they known about the PAO. Justice Mackenzie concluded that there wasn't any real and substantial chance of benefit from Lang Michener's breach. Any chance of loss to Fraser was no more than speculative and a mere speculative chance was insufficient to support any claim for damages beyond nominal damages in contract. [Fraser Park South Estates Ltd. v. Lang Michener Lawrence & Shaw [2001] B.C.J. No. 21]

The Environmental Health Officer is entitled to exercise discretion in accordance with Schedule 3 to the Sewage Disposal Regulation, B.C. Reg. 411/85 (the "Regulation"), and the relevant policy guidelines, and considering the specific characteristics of each site.

Mr. Ellis purchased the property in question in 1999. He subsequently built a house on the property and sought a permit to construct a sewage disposal system to serve the house and cabin on the property. The buildings are serviced by an outhouse. Mr. Ellis made several attempts to secure a sewage disposal permit for the property. His initial request was rejected by an Environmental Health Officer ("EHO"), when test holes showed signs of a high water table on the site during the wet season. The EHO stated that before a sewage disposal permit could be issued, it must be shown that the site has 12 inches of undisturbed native soil above the seasonal high water table. The EHO had several other concerns and indicated that he would require a revised system design from a qualified engineer. Mr. Ellis' second application was rejected on similar grounds, as the issues previously identified had not been addressed. Mr. Ellis appealed the decision. After consultation with an engineer, a third plan was proposed and was approved. Mr. Ellis maintained his appeal on the grounds that the third plan was too expensive.

The issue before the Board was whether the decision of the EHO to refuse to issue a sewage disposal system permit, as sought in the April 26, 2000 application, was reasonable in the circumstances. The Board determined that the Panel of the Environmental Appeal Board considered all the relevant evidence before it. In addition, the EHO clearly exercised his discretion in accordance with the Regulation and the relevant policy guidelines, and considered the specific characteristics of the site. [Ellis v. British Columbia (Ministry of Environment, Lands and Parks), [2001] B.C.E.A. No. 3 Appeal No. 2000-HEA-019]

Contamination by a gas station to property is direct injury to the property, as defined in the Waste Management Act, with a limitation period of two years that begins to run when the direct injury occurs, and will start to run again if liability is admitted.

Florence Low ("Low") alleged various causes of action against Petro Canada in contract, negligence, trespass, nuisance and breach of statute, all arising out of the leakage or spillage of gasoline on commercial property owned by Low, which had been leased by Petro Canada for use as a gas bar. Low alleged that the level and quality of contamination exceeded the applicable standards and requirements set out in the Waste Management Act triggering an obligation upon Petro Canada to remediate or pay the costs of remediation.

Petro Canada did not admit causing the damage to the land. Petro Canada undertook a remediation of the lands to remove certain petroleum hydrocarbons in the soils of the lands. Petro Canada did so in good faith and without admitting liability. Letters were brought into evidence from Petro Canada that purported to admit liability for the contamination. Justice Macaulay found that the damage to Low's property was direct, and the two year limitation was applicable. Justice Macaulay further indicated that Petro Canada confirmed the cause of action within two years before Low commenced her action through correspondence. [Low v. Petro Canada Inc., [2001] B.C.J. No. 318]

Due diligence must be related to particular event

The plaintiff, Imperial Oil ("Imperial") appealed from the decision of the BC Supreme Court, allowing the Crown's appeal from acquittal in the Provincial Court on environmental offences under the Waste Management Act and the Fisheries Act. Imperial admitted discharging effluent into the Burrard Inlet which failed a toxicity test. Imperial advanced a defence of due diligence. The trial judge held that Imperial had exercised due diligence, while the appeal judge reversed the decision. Justice Finch agreed with the Crown and found that the trial judge erred in her conclusion that in spite of Imperial's failure to exercise reasonable care, it had nevertheless exercised due diligence in establishing its "Haz-Ops" Program, and in employing its other measures for environmental safety. The focus of the due diligence test is the conduct which was or was not exercised in relation to the "particular event" giving rise to the charge and not a more general standard of care. [R. v. Imperial Oil Ltd., [2000] B.C.J. No. 2031]

An insurer's obligation to defend an action against an insured does not arise where there is clearly no liability to indemnify under a policy. The term "pollutant" has not been defined in Canadian case law for the purposes of the Pollution Exclusion. The American courts have given "pollutant" a very restrictive meaning. The onus is on the insurer to show the applicability of the Pollution Exclusion of the policy. Work Performed Exclusion clause does not apply to excavation waste being removed from a construction site. Excavation waste is a waste component resulting from the creation of the work product.

The petitioner, Great West Development Marine Corporation ("Great West") sought a declaration that the respondent The Canadian Surety Company ("Canadian Surety") indemnify it for legal costs incurred, and that it assume continuation of its defence in action A92834, Vancouver Registry of the Supreme Court of British Columbia, [1999] B.C.J. No. 2011. Canadian Surety insured Great West pursuant to a Specific Wrap-Up Liability Insurance Policy ("policy") issued with respect to the construction of a condominium project on a site owned by Great West on S.E. Marine Drive in Vancouver. The underlying action concerned alleged damages arising from the delivery and deposit of debris excavated from Great West's construction site on Swamy farmland. Canadian Surety's position was that the coverage is excluded under the Pollution Exclusion, or alternatively, the Work Performed Exclusion, provisions of the policy.

From late July to early August 1998, approximately 500 truck loads of fill were hauled from the construction site and dumped on the Swamy farm property. The petitioner alleged that Great West knew that "an abundance of contaminated fill was being excavated and hauled from the Marine Drive site, and neglected to take adequate steps to ensure proper disposal of such fill, which conduct constitutes negligence, nuisance, contravention of the Waste Management Act". The pollution exclusion on which Canadian Surety relied is known as the "absolute pollution exclusion". Counsel advised that there were no Canadian authorities addressing the definition of a pollutant for purposes of the Pollution Exclusion. The origin of the clause is from American insurance policies, and the clause has been considered many times by courts in the United States. In the United States, courts have given the definition of pollutant a very restrictive definition.

Justice Holmes indicated that it was "unclear to me on the pleadings that the fill from the construction site would reasonably be considered a pollutant in the general sense of being harmful, or having any significant quantity components or ingredients that might be thought inherently harmful, dangerous or of likely deleterious effect". Canadian Surety bore the onus of establishing that the exclusion applies. Justice Holmes determined that Canadian Surety did not meet the onus of establishing the applicability of the Pollution Exclusion of the policy, or that it had been clearly demonstrated that Great West is not entitled to indemnity under the policy. Therefore, coverage is not excluded under the Pollution Exclusion clause. In addition, Justice Holmes determined that the Work Performed Exclusion also did not apply to the present circumstances. [Great West Development Marine Corp. v. Canadian Surety co. (2000) B.C.S.C. 806]

In order to determine whether a parent company can be named as a responsible person in a remediation order, the Court has to determine whether the company falls within the definitions of "owner" and "operator" under the B.C. Waste Management Act. The mere fact that a parent company owns shares of the subsidiary that caused the contamination is not reason enough to name the parent company in the order.

On December 19, 1997, a remediation order was issued under the B.C. Waste Management Act to three companies to investigate and remediate contamination of an old wood preservation site on the Fraser River in Burnaby, known as the Kopper's site. For approximately 50 years, the site was used to treat wood with a variety of chemicals, including creosote, PCP and CCA. When the wood preservation plant was decommissioned in the early 1980s, the most accessible, highly contaminated material was removed, but the site remained contaminated with wood preservation chemicals. The remediation order was issued when it was later discovered that these chemicals were leaching into the Fraser River. Beazer East, Inc. ("Beazer") and Atlantic Industries Limited ("Atlantic") both challenged, by way of judicial review, the decision of the Environmental Appeal Board ("EAB") dated March 29, 2000. The Board upheld the decision of the Assistant Regional Waste Manager to name Beazer and Atlantic as responsible persons in a remediation order issued unders s. 27.1 of the Waste Management Act.

The BC Supreme Court issued its decision on November 24, 2000. The Court held that, in order to determine whether a parent company can be named as a responsible person in a remediation order, the Court first has to determine whether that company falls within the definitions of "owner" and "operator" under the Act. The mere fact that a parent company owns the shares of the subsidiary that caused the contamination is not reason enough to name the parent company in the order.

The Act defines "owner" to mean "a person who is in possession of, has the right of control of, occupies or controls the use of real property". Justice Tysoe of the BC Supreme Court focused on the meaning of the phrase "right of control of...real property". He determined that, in order to fit within the scope of that phrase, the parent company must have a legal right (as opposed to a de facto ability) to control a subsidiary's use of its assets. Justice Tysoe noted, however, that the definition of "owner" is not restricted to the phrase "right of control". The verb "controls" is also contained in the definition. Since the EAB did not choose to interpret the scope and meaning of the word "controls", Justice Tysoe determined that it would be inappropriate for him to do so.

The Act defines "operator" to mean "a person who is or was in control of or responsible for any operation located at a contaminated site..." Justice Tysoe held that a person who makes decisions with respect to an operation is "in control" of the operation, and a person who has the authority to make decisions with respect to an operation is "responsible" for the operation.

Section 26.6(1)(h) of the Act provides that a remediation exemption is available to "a person who provides assistance or advice respecting remediation work at a contaminated site in accordance with this Act, unless the assistance or advice was carried out in a negligent fashion". The Court agreed with the EAB's interpretation of this provision, stating that a person who is otherwise a responsible person cannot become exempt simply as a result of providing assistance or advice respecting remediation work at the contaminated site.

The Court also held that MELP has a broad discretion to name any responsible person on a remediation order. Moreover, MELP (i.e., the Manager) is not required to consider factors of equity and fairness in determining who should be named in a remediation order. However, MELP is not prohibited from considering such factors as long as the result is not inconsistent with the primary objective of Part 4 of the Act, to have expeditious and complete remediation of contaminated sites. In summary, a manager has the discretion to refuse to consider equitable factors and to name any responsible person in a remediation order irrespective of their culpability or any other equitable factor.

Finally, the Court held that the legal result of an amalgamation of companies is that each company is no longer a separate entity. The amalgamating companies continue as one "with all their strengths and their weaknesses, their perfections and imperfections, and their sins, if sinners they be". [Beazer East, Inc. v. Environmental Appeal Board et al, [2000] BCSC No. 1698] ADDITIONAL INFORMATION

Premier Dosanjh Announces Environmental Commissioner

On January 31, 2001, a News Release was issued by the Office of the Premier, Green Economy Secretariat, indicating that a commissioner for environment and sustainability will be established as part of the provincial government's commitment to preserving B.C.'s natural heritage for future generations. The new commissioner will report on government's progress towards the province's environmental goals. The environment and sustainability commissioner will report to the legislative assembly and will be based within the office of the auditor general. The commissioner will report annually on ministry and Crown corporation progress towards sustainability objectives and will publish a status report on B.C.'s ecological health every two years.

Under a memorandum of understanding with the auditor general executed by cabinet order, the auditor general will select and lead a representative panel of British Columbians to recruit B.C.'s first commissioner. Legislation to establish the environmental commissioner will be introduced in the next session of the legislature.

Vancouver Island Higher Level Plan Approved

The Higher Level Plan for Vancouver Island took effect on December 1, 2000. The approval of the HLP makes binding those parts of the Vancouver Island Land Use Plan at variance with the general provisions of the Forest Practices Code. Provisions in the Vancouver Island Land Use Plan to increase protection for ecological, aesthetic or wildlife values now have the force of law.

The HLP designates 20 special management zones where logging is permitted only in ways that conserve other values like biodiversity. It also designates 22 enhanced forestry zones where economic opportunities will be enhanced without significant risk to the environment.

Land Use Plan Puts BC Over 12 Per Cent Goal

The British Columbia government approved the Mackenzie Land and Resource Management Plan, adding over 600,000 hectares to BC's parks and recreation areas and making BC the only jurisdiction in North America to meet the United Nations' goal of protecting 12 per cent of its landbase.

New protected areas in the Mackenzie plan connect to the Muskwa-Kechika management area, established in 1997, and create an arc of protected and special management lands form the Northern Rockies all the way to the Pacific coast. In addition, the province is adding $1 million to the Muskwa-Kechika Trust Fund to expand planning, research and conservation work.

*This report would not have been possible without the assistance of Erin Tully, articling student, at Miller Thomson.