CANADA Law and Practice Contributed by: Laura Duke, Will Shaw and Emma Russell, Lawson Lundell LLP
5. Environmental Liability 5.1 Key Types of Liability
operators, or suppliers and transporters of products may face liability for: • pollution or harm to the environment; • failing to comply with specific environmental regu- lations or permits; • the ownership, operation or control of contami- nated sites; or • the supply of products to contaminated sites. A defence of due diligence is usually available to par- ties accused of breaching environmental legislation. The due diligence defence contains two branches: • reasonable care (ie, the accused took all reason- able care to avoid the incident and it occurred in any event); and • mistaken belief of fact (ie, the accused reasonably believed in a set of facts that, if true, would render the conduct innocent). Other common-law and equitable defences may be available, depending on the alleged offence. In some cases, no defence is available at all (absolute liability). In addition, contaminated sites regimes in some Canadian jurisdictions provide for broad statutory lia- bility for historic environmental incidents or damage. For example, in British Columbia, liable persons may include both current and former operators or owners of the contaminated land, even if that person did not cause or contribute to the contamination (though cer- tain statutory exemptions exist). Statutory contami- nated sites claims are often brought alongside claims for nuisance, negligence and/or trespass from private parties affected by contamination. Recovery of costs associated with the remediation of contaminated sites is typically pursued through pri- vate law claims. For further details, please see 10.1 Civil Claims .
The key types of liability faced by project proponents or operators in Canada for environmental damage or breaches of environmental law include: • monetary fines; • remediation orders; • the loss of environmental permits; and • prosecution. Where environmental harm can be pursued through civil action (eg, with regard to contamination), there is also a risk of court-ordered damages. Environmental legislation typically includes a provi- sion that makes it an offence to fail to comply with the legislation. Environmental legislation also often provides that any non-compliance occurring over time constitutes a separate offence for each day that the breach occurs. The result is that offenders are at risk of multiple convictions and large monetary fines if environmental breaches continue for a period of time. Employees, agents, directors and officers may be held personally liable for environmental offences; however, this is uncommon. 5.2 Liability for Historical Environmental Incidents or Damage Liability for contaminated land typically falls on current and former landowners and/or the person responsi- ble for the contaminating substances – not on federal or provincial governments. However, depending on the specific statutory scheme, non-owners may also be liable where they had certain types of involvement in the site or with the contamination or damage. For more detail on this, see 5.3 Key Defences . 5.3 Key Defences Most environmental legislation in Canada is based on the “polluter pays” principle. This provides that the party causing the harm should be the one who bears the associated cost. There are several types of liability for environmental incidents or damage in Canada. Project proponents,
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