Wheel off wood chipper case sent back for new trial

Ontario Ministry of Transportation (MTO) officers investigated a truck stopped along a highway.  Attached to the truck was a wood chipping machine that was missing its right wheel.  The hub of the wheel was located at the end of a scrape mark in the pavement, but the wheel was not found.  The wheel hub had the eight wheel-fastening bolts shorn from where the wheel should have been attached.

The truck belonged to a tree services company.  The MTO charged the company and the person that was present with the truck with offences under the Highway Traffic Act (HTA) - the company was charged with a "wheel-off" offence and the individual was charged with driving an unsafe vehicle.

The Justice of the Peace at trial acquitted both defendants, finding that the wood chipper was not a vehicle (an essential ingredient of each charge).  A wood chipper was being towed, but was not a "thing used for transporting people or goods on land".  The Crown appealed the decision, arguing that the JP erred in not taking a purposive or purpose-based approach to the interpretation of the charging provisions. 

On appeal, a judge of the Ontario Court of Justice agreed that the purposive approach is to be applied and results in a finding that the wood chipper was, in fact, a vehicle for the purposes of the HTA.  However, the judge also noted that there were other defences that could have possibly been raised by the defendants at trial, but that were not necessary for the trial judge to deal with (given the ruling on a wood chipper not being a vehicle).  Both charges were sent back for a new trial.

Read the decision at: Ontario (Ministry of Transportation) v. Tsapoitis.

Tribunal upholds rejection of milk from farm's bulk tank

The Ontario Agriculture, Food and Rural Affairs Tribunal has dismissed an appeal by an Ontario dairy farm from the rejection of milk from its operation by the Dairy Farmers of Ontario ("DFO").  The farm has operated for 30 years and, in the fall of 2010, was carrying out three milkings a day.  A transport company picked up the milk from a farm bulk tank on every second day, representing six milkings.

On November 28, 2010, the transporter (a certified Bulk Tank Milk Grader) arrived to pick up milk.  He rejected the milk "because of an off odour "malty" smell".  He took two samples and declined to pick up the milk, leaving a "Red Tag" at the farm.

The farm appealed the rejection of the milk on the basis that the DFO had not followed the proper procedure.  However, the Tribunal ruled that procedural errors made by DFO and its agent, the transporter (not properly filling out the Red Tag and not proving that DFO had adopted a policy of "no second opinions" with respect to the rejection of milk), did not negate the determination that the milk should be rejected. 

Read the decision at: La Gantoise Inc. vs. Dairy Farmers of Ontario (DFO).

OHSA conviction of farm operation upheld on appeal

An employee of a chick hatchery operation was injured when she fell climbing down from a storage trailer used to house paper liners used in shipping crates.  The employee broke her leg.  The hatchery was charged under the Occupational Health and Safety Act for failing "to take the reasonable precaution of ensuring that adequate access and/or egress was provided for a transport storage trailer".  The hatchery was convicted at trial and appealed the conviction.

Justice Nadel of the Ontario Court of Justice upheld the conviction, finding that, "while the set of steps may once have worked well and may once have been adequate to their purpose that was no longer the case after the trailer had been moved. ... A gap of two feet between rungs of a ladder or a rise of two feet between the treads of a set of steps is, in my view, self-evidently unsafe.  Likewise, a gap of two feet between the top of a set of steps and the platform those steps are intended to give access to is equally self-evidently unsafe and inadequate to the purpose."

The defendant had taken the position on the appeal that, "there is no offence known to the law of Ontario that requires an employer in a farming operation to take the reasonable precaution of ensuring that adequate access and/or egress is provided for a storage facility where the employee's task requires her to work at a height that is less than three metres" (as paraphrased by Justice Nadel).  This was rejected by the Court.

Read the decision at: Ontario (Ministry of Labour) v. Stratford Chick Hatchery Ltd.

NOVA/TransCanada withdraws application to "decommission" 266 km line

In August, 2012, NOVA Gas Transmission Ltd. (part of TransCanada Pipelines) applied to the National Energy Board (NEB) for permission to "decommission" a 266-km stretch of pipeline.  Essentially, the application would see the abandonment of the line in place, but NOVA contended that it was "decommissioning" the line because service on its "pipeline" would continue.  The NEB disagreed and directed that it would consider the application as one to abandon a pipeline.

On February 8, 2013, NOVA wrote to the NEB to withdraw its application, saying that it was reviewing its proposal in light of the NEB's comments: February 8, 2013.  The NEB confirmed this development in its letter to NOVA dated February 25, 2013.

Landowners should keep an eye on these developments.  It appears that pipeline companies are taking the position that, as long as they continue to transport materials somewhere on their pipeline systems, none of their abandonments are actually "abandonments" within the meaning of the NEB Act.  Instead, the companies will suggest that they are "decommissioning" pipelines, depriving landowners and other interested parties from public hearings, participant funding, etc.

Natural severance granted to two landowners by Superior Court

Owners of two different properties in the Hamilton, ON area brought applications to "clarify or determine title" to the bed of a waterway that traverses each of the properties.  If the waterway was determined to be navigable, then the bed of the waterway would remain the property of the Crown and would effect a severance of the properties involved.  Section 1 of the Beds of Navigable Waters Act provides: 

"Where land that borders on a navigable body of water or stream, or on which the whole or a part of a navigable body of water or stream is situate, or through which a navigable body of water or stream flows, has been or is granted by the Crown, it shall be deemed, in the absence of an express grant of it, that the bed of such body of water was not intended to pass and did not pass to the grantee."

The Crown Patent for both properties was issued on January 11, 1816 to a single owner.  The original Patent did not contain any express grant of the bed of the watercourse.  Therefore, if the watercourse was found to be navigable as of the date of the grant, then title to the bed of it would remain vested in the Crown.

On the basis of evidence presented by the parties, the Court concluded that it was probable that the waterway was navigable for significant periods of the year in 1816.  Title of the bed of the waterway remains in the Crown (resulting in the natural severance of the Applicants' properties).

Read the decision at: O’Donnell v. Ontario (Attorney General) and Obratoski v. Ontario (Attorney General).

NEB to introduce Administrative Monetary Penalties

The National Energy Board (NEB) has developed draft Administrative Monetary Penalties Regulations (AMP Regulations) and published them in the Canada Gazette, starting a 30-day public comment period. 

Under the proposed regulations, the NEB can issue a Notice of Violation to landowners who construct a facility or excavate without leave under Section 112(1) of the NEB Act or who fail to obtain leave of a pipeline company to drive vehicles or mobile equipment over a pipeline right-of-way under Section 112(2) of the NEB Act.  These violations are designated as Type-B violations and will result in a monetary penalty of between $4,000 and $100,000 for a corporation and between $1,000 and $25,000 for an individual.

NEB Abandonment Cost Estimates: Will there be enough money?

The National Energy Board released its decision in the Pipeline Abandonment Cost Estimates proceeding yesterday (click here).  An oral public hearing was held in Calgary last October and November.  For pipeline landowners, the key ruling by the NEB was its finding that basing cost estimates on an assumption of zero removal of pipelines in agricultural lands was unreasonable.  The NEB has already decided that companies must begin collecting tolls now to cover the future costs of pipeline abandonment; the question is how much is to be collected.  Companies argued that the amounts should be based on the assumption that nearly all pipelines in agricultural lands should be abandoned in place.  Not surprisingly, this was oppposed by pipeline landowners.

In an earlier hearing, the NEB had rejected the landowner proposal for a 100% removal assumption for all medium and large diameter pipelines in agricultural lands.  Instead, the NEB created a "base case" assumption calling for 20% removal and 80% perpetual maintenance, though giving companies the opportunity to provide justifications for a departure from this base case.  In its most recent decision, the NEB found that the companies had failed to justify their proposed departures from the base case and ordered that abandonment funding amounts be set based on the 80/20 split:

The Applicants have not successfully justified their deviation from the Base Case assumption for medium and large diameter pipe in these two land-use sub-categories. During the course of the MH-001-2012 hearing, all Applicants made submissions to the Board as to why the Base Case assumptions of 80 per cent abandonment-in-place and 20 per cent removal should not be imposed. The Board considered these comments but does not find them convincing. In addition, the Board also considered Applicants’ responses to a Board request made during the course of the hearing. Applicants were asked to provide recalculated cost estimates for three theoretical scenarios – 10, 20 and 30 per cent removal on "Agricultural, Cultivated" and "Agricultural, Cultivated and Non-Cultivated" sub-categories, using their own methodologies. Finally, the Board considered the issues described above regarding easement agreements, landowner surveys, and the lack of provision for any site-specific issues that may necessitate removal. The Board has exercised its judgment in determining a reasonable assumption for medium and large diameter pipelines in the "Agricultural, Cultivated" and "Agricultural, Non-Cultivated" sub-categories. In the Board’s view, 20 per cent removal for medium and large diameter pipe in these land-use sub-categories is a reasonable, prudent and adequate starting point for estimating purposes.

For the landowners and landowner groups who participated in the hearing process (at their own cost, given that there is no mechanism for cost recovery in the NEB hearing process and no participant funding available), this decision is a victory.  However, it remains to be seen whether the 80/20 split and the companies' actual estimates of abandonment costs will be sufficient to protect landowners from the costs of pipeline abandonment in the future.  The positions taken by the pipeline companies in the proceeding demonstrate that they will likely do everything in their power to avoid having to remove their abandoned pipelines from the ground. 

Federal Court denies Monsanto default judgment over patent infringement

Monsanto Canada Inc. and Monsanto Company have been denied an order for default judgment by the Federal Court of Canada in a patent infringement case.  The farmer involved did not file a defence.  Monsanto alleged that the farmer signed a licence with and obtained patented seeds from Monsanto; that the licence permitted the farmer to grow one crop, not to save seeds, and not to replant a new crop from those seeds; and that, notwithstanding the terms of the licence, the farmer saved seeds and planted a crop containing the patented gene. 

The rules required that Monsanto file affidavit evidence in support of its claim.  In other words, although there was no defence filed, the Court would not simply accept the allegations in the claim without some proof.  Monsanto attempted to circumvent this requirement by serving a "Request to Admit", a series of allegations put to the opposing party.  Where the opposing party fails to answer (either by admitting or denying the allegations), as in this case, that party is deemed to have admitted the allegations.

The Federal Court declined to accept this "evidence" as a sufficient basis for a default judgment order:

I am sceptical of such an attempt to “bootstrap” the requirement to provide the necessary evidence to support a default judgment by procedural manoeuvring. While it is true that, particularly in contested proceedings, the Request to Admit process is useful in eliminating the need to prove certain facts, I am satisfied that such a Request cannot be a substitute for affidavit evidence required on a motion for default judgment. Rule 210(3) states that a motion for default judgment shall be supported by affidavit evidence which evidence, in the context of the Rules, I take to be directed to the substance of the claim and not just an affidavit of service. I agree that the Court might even have discretion in respect of certain of the practice and procedural provisions of the Rules. In this case, because there is no affidavit evidence, whatsoever, to support the allegations in the Statement of Claim, I will not exercise any discretion, even if I have it, to accept the unanswered Request to Admit in lieu of such affidavit evidence.

Read the decision at: Monsanto Canada Inc. v. Verdegem.