Berendsen decision overturned by Ontario Court of Appeal

The Ontario Court of Appeal has overturned an award of damages of more than $1.7 million (plus costs of $655,000) to a farm family who claimed that the province of Ontario was liable for the contamination of their well water and the resulting health problems and under-production of their dairy herd. After a five-week trial, the Ontario Superior Court of Justice had ruled that Ontario was liable for the damage as a result of having dumped asphalt from a road project on the Berendsen farm in the 1960's. The Court of Appeal disagreed.

The Berendsens did not purchase the property until 1981. The previous owners of the farm had consented to the dumping by the province. On appeal, Ontario did not take issue with the trial judge's finding that damages were suffered or with the amount of her award. Instead, Ontario contended that it was not the cause of the damage and, in any event, had acted in accordance with the standard of care required (conduct will breach the standard of care, i.e. will be negligent, if it creates an unreasonable risk of harm).

The Court of Appeal found that for Ontario to have been negligent and liable for the damages alleged, the Berendsens needed to have shown that the risk of damage to their cattle was a reasonably forseeable consequence of the deposit of the asphalt on the farm in the 1960's. The Court noted that the risk of harm must be seen through the lens of public understanding of toxicity and contamination in the 1960's, not our understanding of the risk today. The Berendsens were unable to put forward evidence that the risk was forseeable in the 1960's.

What comes next is a decision on costs. The Court of Appeal will need to decide on the costs of the appeal and on what to do with the $655,000 in costs that was awarded to the Berendsens.

Read the Court of Appeal's decision at:

http://www.canlii.org/en/on/onca/doc/2009/2009onca845/2009onca845.html

B.C. landowner liable for breach of Terasen Right-of-Way agreements

In a decision rendered January 25, 2010, the British Columbia Supreme Court found Utzig Holdings (B.C.) Ltd. liable for possible damage caused to a Terasen (formerly B.C. Gas) pipeline by a landfill operation. The damage alleged is stated to be "possible" because no trial has yet been held on the issue of damages. It may be found that none were sustained. What has been decided is that Utzig, as owner of the land in question, is responsible to Terasen both under right-of-way agreements and the tort of nuisance.

Utzig owned the land, but leased it to two different landfill operations (which were found liable in an earlier trial). Terasen alleged that the landfill operations, which were conducted outside the statutory right-of-way, caused one of two pipelines to shift (on one occasion up to 1/2 a metre) and put the pipeline operation at risk. The trial judge found that this was the case. The trial judge also found that Utzig, although it had signed an Agreement of Purchase and Sale to sell the properties to the landfill operations, remained the "owner" for the purpose of the right-of-way agreements. The sale of the property, if it had occurred at all, had not been registered on title.

Because of the unique ownership situation in this case, the trial decision includes long discussions of fairly complex liability issues. However, what will be more interesting to see will be the decision on damages when it is made. The trial decision notes that the shift in the pipeline's position caused Terasen (then B.C. Gas) to shut down portions of the pipeline due to safety concerns and then build a replacement pipeline in another area.

Read the decision at:
http://www.canlii.org/en/bc/bcsc/doc/2010/2010bcsc90/2010bcsc90.html

CBC News - Money - Environmental panel's demands could kill Mackenzie project: Imperial

CBC News - Money - Environmental panel's demands could kill Mackenzie project: Imperial

Imperial Oil and other backers of the proposed Mackenzie Valley pipeline are asking the National Energy Board to reject several recommendations made by the Joint Review Panel set up to assess the project. For one thing, the project proponents claim that a restriction on noise from facilities installed within a 623 square kilometre bird sanctuary may prevent development of about two-thirds of the gas intended for the pipeline. The proponents also reject the suggestion that assessments be filed about the effects of construction on permafrost before trenching is begun.

The proponents comments on Joint Review Panel recommendations within the NEB's mandate are available at:

https://www.neb-one.gc.ca/ll-eng/livelink.exe?func=ll&objId=593186&objAction=browse

The proponents comments on Joint Review Panel recommendations outside the NEB's mandate are available at:

https://www.neb-one.gc.ca/ll-eng/livelink.exe?func=ll&objId=593190&objAction=browse

The report submitted by the Joint Review Panel is available at:

https://www.neb-one.gc.ca/ll-eng/livelink.exe?func=ll&objId=588326&objAction=browse

Enbridge discovers historical contamination near Wawanesa, MB

The NEB issued a letter (see link below) to Enbridge Pipelines Inc. today requesting information about the recent discovery of historical hydrocarbon contamination of soil during the construction of the Alberta Clipper pipeline near the crossing of Black Creek (near Wawanesa, Manitoba). It will be interesting to see the report Enbridge makes to the Board on its response to the discovery. I'll keep you posted.

https://www.neb-one.gc.ca/ll-eng/livelink.exe/fetch/2000/130635/593167/A1R5L3_-_Letter_and_Information_Request_to_Enbridge_Pipelines_Inc._Re._Historic_Contaminated_Soil_near_Wawanesa,_MB_Lettre_et_demande_d’information_à_Enbridge_Pipelines_Inc._concernant_l’historique_des_sols_contaminés_près_de_Wawanesa,_MB?nodeid=593168&vernum=0

Tractors on the lawn okay... just not in the city

Last December, Helene and David How of Saskatoon lost their appeal of convictions of violating Saskatoon city by-laws prohibiting the repair and storage of vehicles on their urban property. The vehicles in question were restored tractors. They had carried on the hobby of restoring and displaying the tractors while living on their farm outside the city, and when they moved into Saskatoon they continued with the hobby. Both the trial judge and the judge on appeal dismissed the idea that the repair and storage were permissible because they were done in the context of a "hobby". If that were the case, they concluded, then one person would be permitted to repair and store tractor-trailer units on a property as a hobby, while a neighbour would be prohibited from the same activity because it was done to make a living.

Read the decision at: http://www.canlii.org/en/sk/skqb/doc/2009/2009skqb490/2009skqb490.html

CBC News - Calgary - Oil and gas drilling to rise: forecast

CBC News - Calgary - Oil and gas drilling to rise: forecast

According to the Petroleum Services Association of Canada, western Canadian landowners can expect an increase in the number of gas and oil wells being drilled on their properties in 2010. 6,095 new wells are estimated for Alberta this year. British Columbia should see an additional 630 drilled. Saskatchewan and Manitoba should expect to see 1,935 and 300 new wells, respectively.

CBC News - Prince Edward Island - Farm fined for excess land holdings

CBC News - Prince Edward Island - Farm fined for excess land holdings

Go the above link to read an interesting story about land holding restrictions in PEI. The Lands Protection Act in PEI places limitations on the amount of land that can be owned and on non-resident ownership of land (see: http://www.irac.pe.ca/document.asp?file=legislation/LandsProtAct.asp). Given the size of the province, one can see why there would be such a limit on aggregate land ownership in addition to the non-resident limitation (which also existed in Saskatchewan).

NEB Joint Review Panel selected for Enbridge Northern Gateway Pipeline

Canada's Environment Minister Jim Prentice and the National Energy Board have appointed a three-member panel to review the Enbridge Northern Gateway Pipeline project. Two of the three appointees are members of the NEB: Sheila Leggett and Kenneth Bateman (Hans Matthews is the other). Of note, both Leggett and Bateman sat on the panels that heard and decided GH-5-2008 TransCanada's NOVA Application (transfer of jurisdiction from Alberta to Federal) and heard the Stream 3 Abandonment Funding hearing.

The NEB's announcement of the appointments can be viewed at:
http://www.neb-one.gc.ca/clf-nsi/rthnb/nwsrls/2010/nrthrngtwjrpstblshmnt-eng.pdf

Montreal Pipe Line Limited Applies to Abandon Pipeline in place

Montreal Pipe Line Limited has applied to the National Energy Board to abandon in place a small length of oil line that has been deactivated for several years. At the following link you can read the NEB's initial response to the application, including a number of information requests, as well as the application itself:
https://www.neb-one.gc.ca/ll-eng/livelink.exe?func=ll&objId=576050&objAction=browse&sort=-name

One of the main concerns raised about the application is the risk of future contamination. MPL acknowledges in its application that the plan is to leave the pipe in the ground unprotected and the result will be the corrosion of the pipeline.

R. v. Schmidt Unpasteurized Milk Decision now posted online

The decision of the Ontario Court of Justice last week acquitting Ontario farmer Michael Schmidt of all charges relating to the sale of unpasteurized milk is now available online at:
http://www.canlii.org/en/on/oncj/doc/2010/2010oncj9/2010oncj9.html
(Schmidt himself had posted a copy of the decision on his website, but the file size of this publicly available copy is much smaller)

You might find His Worship Kowarsky's comments at the very end of the decision (paragraphs 185 and 186) of particular interest. He makes a point of explaining what his decision does not do: it does make it legal to market unpasteurized milk; it does not invalidate Ontario's milk marketing legislation, etc.

OMB refuses severance of farm land in Sarnia area

In a decision issued January 5, 2010, the Ontario Municipal Board has dismissed an appeal of the County of Lambton's refusal of an Official Plan Amendment. The amendment would have allowed Dario and Janet Maola to create three non-farm residential lots out of their 10.8 acre property within the City of Sarnia. The current land use designation for the property in the City of Sarnia Official Plan was Rural. OMB Member S. J. Stefanko accepted the submissions of the County of Lambton in finding that the proposed amendment to allow agricultural lands to be severed for residential lots would not be consistent with the 2005 Provincial Policy Statement (agricultural areas shall be "protected by directing non-related development to areas where it will not constrain [agricultural] uses") and would not conform with either the County or the City Official Plan.

The decision can be viewed at: https://www.omb.gov.on.ca/e-decisions/pl090330-jan-05-2010.pdf

Enbridge Landowner in Minnesota documenting Alberta Clipper construction on her blog

A Minnesota landowner along the Enbridge Alberta Clipper pipeline route has a blog devoted to documenting the construction process through her property. Lots of pictures of winter construction. There's also reference to an outstanding trespass charge laid against another landowner who went onto the easement on his own property. He was arrested "at taser-point" for allegedly interfering with the construction.

Follow this link to the blog: http://www.areavoices.com/pipeline/

NY Attorney General comes to defence of landowners caught in lease extensions

Click on the post title above to read an article by Sue Heavenrich from December, 2009 about an agreement between the Attorney-General of New York State and gas drilling company Fortuna to resolve complaints of false statements made by Fortuna to landowners. Fortuna's leases were expiring, and the company wrote to landowners telling them that if they did not renew the leases within 30 days, Fortuna would be filing notices with county clerks to prevent landowners from negotiating with other companies.

Ms. Heavenrich's blog, "The Marcellus Effect", reports on issues regarding the Marcellus Gas formation and landowners in upstate New York. Her blog also links to the website of the Tioga County Landowners Group (http://www.tiogagaslease.org/).

CBC News - Ontario farmer not guilty of selling raw milk

CBC News - Canada - Ontario farmer not guilty of selling raw milk

Dairy farmer Michael Schmidt has been found not guilty of 19 charges related to the sale of unpasteurized milk. Schmidt represented himself against the Ministry of Natural Resources in a trial before the Ontario Provincial Offences Court.

I'll keep an eye out for any written reasons for the verdict in the case and post a link to them if they are available.

Another canola failure case, another failure to prove cause

Last week, I posted a case in which a farmer alleged that defective seed was the cause of his poor canola crop. This week, I have another case along the same lines. This time Pioneer Grain Company sued Saskatchewan farmer Dale Ortynsky after he refused to pay for herbicides he had purchased because he alleged they were the cause of his crop's poor yield. The spray manufacturers, Bayer and Dupont, were added as third parties to the action. Ortynsky also made a counter claim against Pioneer for damages related to the poor yield.

Once again, lack of evidence about the actual cause of the crop failure meant a finding against the canola farmer. Justice J.E. McMurtry of the Saskatchewan Court of Queen's Bench concluded, "The defendants have not satisfied me that the poor canola crop resulted from herbicides sold by Pioneer and not by some other factor such as weather, soil conditions, farming practice, and/or application of the [herbicide]." Civil claims must be proved on a balance of probabilities (basically, 50% plus 1 or more likely than not). In this case, as Ortynsky could not prove on a balance of probabilities that the herbicide was the cause of the crop failure, his counter claim failed and he was ordered to pay for the herbicide he had purchased, plus interest and costs.

http://www.canlii.org/en/sk/skqb/doc/2009/2009skqb513/2009skqb513.html

CBC News - Manitoba - Coyotes, wolves blamed in livestock deaths

CBC News - Manitoba - Coyotes, wolves blamed in livestock deaths

Coyotes and wolves are being blamed for recent livestock deaths on a farm in the Interlake area of Manitoba.

CBC News - Samsung deal to bring wind, solar farms to Ont.: sources

CBC News - Consumer Life - Samsung deal to bring wind, solar farms to Ont.: sources

There are reports that Samsung already has plans in place for a 200-turbine wind farm on the north shore of Lake Erie, and may be working on a deal with the Ontario government for payments higher than the Feed-in-Tariff rate of 13.5 cents per kilowatt hour.

Electricity Conservation on Ontario Farms

The Ontario Power Authority has released the latest edition of its publication "Electricity Conservation on Ontario Farms", including information on how to take advantage of the new Feed-in-Tariff (FiT) program and restrictions on the installation of solar panels on farm land. Click on the title above to access the OPA's page.

If you're interested in developing an energy project on your land and need advice, you can get in touch with me by email through my profile or at http://www.cohenhighley.com/goudy1.htm.

Damages awarded for sour gas contamination of water well

The Alberta Court of Queen's Bench has awarded a family $30,000 for damage caused to its water well by Impact Energy Inc. Under a surface lease agreement, the Blatz family had granted to Impact the right to use an area of 4.45 acres to drill a sour gas well. The well was directionally drilled. Shortly thereafter, the family began to notice changes in its water supply (cloudiness and odour). The Court was satisfied that the damage to the quality of water was a result of the drilling of the sour gas well. A report of the case is available at the link below.

http://www.canlii.org/en/ab/abqb/doc/2009/2009abqb506/2009abqb506.html

Proposed Management Plan to address impacts on agricultural operations - is it good enough?

Montana Alberta Tie Ltd. (MATL) has filed with the National Energy Board what is calls a "Management Plan for Addressing Impacts to Agricultural Operations" related to its proposed international electricity power line system (click on the title above to see the document).

MATL describes its "hierarchy of mitigation": 1) modify its own design where possible to allow the continuation of current farming practices; 2) where design cannot be modified, modify the farming system at MATL's expense to allow for comparable productivity; 3) where neither of the above will mitigate the lasting impact, MATL will compensate the landowner for "any substantiated losses" that result from the construction and operation of the line.

Does this plan provide landowners with enough protection against future loss attributable to the project? What do you think?

Ontario: Small Claims Court Claims Limit now up to $25,000

Effective January 1, 2010, the jurisdiction of the Small Claims Court in Ontario has risen to $25,000, exclusive of costs and interest. Prior to 2010, only claims for $10,000 could be brought in the Small Claims Court, which offers a more streamlined and less expensive court process than the Superior Court.

http://www.attorneygeneral.jus.gov.on.ca/english/courts/civil/changes_to_SCC_Jan_2010.asp

Enbridge pipeline adjacent to Alberta Clipper leaks 126,000 gallons

The Enbridge crude oil pipeline that leaked on Friday night just south of the Canada-U.S. border is back in service. About 126,000 gallons of light crude oil was spilled, covering an area of 700 feet by 40 feet, contained within the Enbridge easement according to Enbridge public affairs. The ruptured pipeline, which was put into service in the mid-1970's, runs adjacent to the Alberta Clipper pipeline, which is under construction.

CBC News - Saskatchewan - Sask. farmer sues over payments to railways

CBC News - Saskatchewan - Sask. farmer sues over payments to railways

CBC reports on a proposed class action lawsuit commenced by Saskatchewan farmer, Gordon Wallace, who alleges that Canada's major railways have overcharged farmers for maintenance of railcars since 1983.

Pipeline Coming? What to do?

Click on the title to see Paul Vogel's Agrilaw article from June, 2009 with some suggestions about how to respond when you find out your farm is in the path of a proposed pipeline.

What happens when a landowner actually has the upper hand?

This question may be answered by the National Energy Board in response to an application made by NOVA Gas Transmission Ltd. (NOVA) for a Right of Entry Order. A NOVA landowner, Randolph Allan Hill, purchased land with the NOVA pipeline in place from CP Rail. CP Rail, like many other railways and large industrial landowners, had in place a "landowner-friendly" crossing agreement with NOVA which provided the landowner with a right to terminate the agreement on notice and require the removal of the pipeline.

In a December 2008 hearing before the Alberta Court of Queen's Bench, NOVA tried unsuccessfully to argue that Hill, although he had purchased the land from CP Rail, was not entitled to benefit from the crossing agreement. The Court disagreed in its decision dated March 6, 2009. Subsequent to that decision, Hill served notice on NOVA that he wanted the pipeline out of the ground. NOVA has now asked the NEB to grant an order allowing it to leave the line in place, in spite of the crossing agreement.

Not surprisingly, Hill has objected to the Right of Entry application and relies on the terms of the agreement that he purchaed from CP Rail.

NEB filings related to this case can be found at: https://www.neb-one.gc.ca/ll-eng/livelink.exe?func=ll&objId=586898&objAction=browse

Injured Dairy Farmer gets relief and keeps relief

A decision of the Agriculture, Food and Rural Affairs Appeal Tribunal in favour Ontario Dairy farmer Michael Vandergeest has been upheld on a review application. Vandergeest, who was forced to sell out his dairy quota after suffering a serious injury in 2008, was granted a partial exemption by the Tribunal from the 15% quota transfer assessment payable on the sale of dairy quota. In Vandergeest's case, the assessment payable to the Dairy Farmers of Ontario (DFO) would have been nearly $63,000. The Tribunal lowered this amount by half, but the DFO sought a review of the decision. On review, the Tribunal found that its decision was proper. A full assessment exemption was not appropriate because Vandergeest's quota, over 28 years in business, had appreciated considerably. However, his serious injury that cut short his farming career was an extraordinary event and warranted a partial exemption.

http://www.omafra.gov.on.ca/english/tribunal/vandergeest-review-dec.htm

Dr. George Brinkman to speak on Viability of Canadian Agriculture

Dr. Brinkman, formerly of the University of Guelph, Department of Agricultural Economics, will present a "webinar" on January 18, 2010 at noon EST entitled, "Viability of Canadian Agriculture - Updates for 2010". If you're interested in listening to this presentation or others posted by the Canadian Farm Business Management Council, visit:
http://agriwebinar.com/Preview.aspx?id=189b91c3-d2f0-4481-8f4e-d48cc05e0c9d

Claims that canola seed was defective are going to be difficult

In a recent decision dismissing a claim for damages related to defective canola seed, the Saskatchewan Court of Queen's Bench has commented on the difficulties inherent in this type of claim. After finding that Saskatchewan's Consumer Protection Act did not apply to the seed because it had been purchased in Manitoba, Justice M.D. Acton then commented about the number of actions that have been commenced involving alleged defects in the quality of seed. Acton noted, however, that the evidence has been that the many sensitivities of canola seed include: slow germination when seeded in cool damp soil; susceptibility to frost at an early stage; susceptibility to drought and heat at an early stage; inability to emerge through compacted or crusted clay soils caused by heavy rains immediately after seeding; poor competition with weeds at an early stage; susceptibility to disease and insect infestation. In the case at bar, experts for both sides advised that numerous factors other than seed quality may have caused the failure of the seed to produce a viable and acceptable canola crop. That evidence spelled the end for the claim. The Court was unable to find, on a balance of probabilities, that the quality of the seed was the cause of the crop failure alleged.

Negrave v. Pioneer Grain Company Limited, 2009 SKQB 492
http://www.canlii.org/en/sk/skqb/doc/2009/2009skqb492/2009skqb492.html

Summary Judgment granted for failure to deliver on marketing contract

The Saskatchewan Court of Queen's Bench granted summary judgment in favour of Walker Seeds Ltd. after the defendant, Jacob Enterprises Ltd., failed to deliver fully on a marketing agreement for desi chickpeas. The agreement provided that Jacob would deliver to Walker all chickpeas growns on 660 acres of land in 2006, save that Jacob could retain 95 pounds net per acre for seed. There was a dispute between the parties as to how much Jacob actually harvested in 2006. The contract provided for a base production amount of 13,200 bushels, and the Court found that Jacob had exceeded this production, although he delivered only 8,258 bushels to Walker. The Court granted judgment to Walker for the difference owing of 4,942 bushels at 60 pounds per bushel (296,520 pounds) times $6.25 per bushel, or $18,532.50.

A counterclaim by Jacob Enterprises for severe emotional distress caused by an alleged failure by Walker to pay for delivered chickpeas in a timely fashion and failure to provide receipts for grain was dismissed. The Court noted the difficulty it had in accepting a claim by the corporation for the emotional distress of its shareholder.

Walker Seeds Ltd. v. Jacob Enterprises Ltd. 2009 SKQB 482
http://www.canlii.org/en/sk/skqb/doc/2009/2009skqb482/2009skqb482.html

Landowner Pipeline Court Costs Case to go to Supreme Court

The Supreme Court has granted leave to appeal from a decision of the Federal Court of Appeal that overturned an award of court costs to a pipeline landowner. In 1999, Alliance constructed a pipeline across Vernon Smith's Alberta property. A dispute arose over payment for restoration work Smith performed himself after the construction, and a claim was made for compensation before the Pipeline Arbitration Committee appointed under the National Energy Board Act. As part of that claim, Smith also claimed court costs related to an unsuccessful injunction action brought by Alliance. The Committee awarded Smith his costs (not already covered by the costs award of the court). The Federal Court of Appeal overturned the award. Now the Supreme Court will decide the issue.

A hearing has been scheduled tentatively for October 5, 2010 at 9:30 a.m.

Raven Damage to Crops not compensable

A claim by a cattle farmer in Manitoba over damage caused to his hay crop by ravens was thrown out of court last November as "frivilous and vexatious". Ravens had pecked holes through the plastic covering over his hay bales, resulting in spoilage that eventually killed a number of animals. Master C.W. Sharp found that the farmer's insurance under the Wildlife Damage Compensation Program did not cover damage by ravens (only "big game" and "waterfowl") and that the failure by the Province to amend the Program to include ravens was not actionable.