Merry Christmas !!!

I wish all of my readers and their families a very Merry Christmas and a Happy New Year!  Good health and good luck to everyone in 2012!

John Goudy

Dawn Gateway Pipeline Project cancelled

Dawn Gateway LP has advised the Ontario Energy Board that it will not be proceeding with the construction of the Bickford Dawn pipeline.  Dawn Gateway LP has also advised Union Gas Limited that it will not proceed with the purchase of the St. Clair Pipeline.  Dawn Gateway says that it is not proceeding with the project as a result of market conditions and "rate payer harm impacts". 

The Dawn Gateway pipeline project was earlier the subject of a constitutional decision by the Ontario Energy Board.  Originally, the pipeline was proposed as a federally-regulated project.  The National Energy Board dismissed concerns expressed by affected landowners that the project was not federal and that, if it proceeded as a federal project, landowners would be negatively affected.  However, the Ontario Energy Board ruled that the project would be provincial and accepted that some of the concerns of the landowners were valid.

Michael Schmidt seeking leave to appeal conviction and sentence

Durham-area farmer Michael Schmidt is asking for leave to appeal his conviction on 15 charges related to the sale of raw milk along with the sentence handed down following the conviction.  Schmidt was sentenced to a fine of $9,150 and one year of probation.  The appeal would be heard by the Ontario Court of Appeal.
Justice Tetley's reasons for sentencing Schmidt are available on the website of the Canadian Constitution Foundation.  The Crown had asked for $1,000 per count for each of ten convictions under the Health Protection and Promotion Act, R.S.O. 1990, c. H-7, and $200 for two other counts under the same Act.  The Crown sought a fine of $5,000 for the offence under the Milk Act of operating a milk plant without a licence during the fourteen week period of the investigation by the Ministry of Natural Resources. 

In handing down the sentence, Justice Tetley declined to rule that Schmidt's was a test case in which it would be appropriate to moderate the sentence.  Tetley did agree, however, that a relevant factor in sentencing was the fact that Schmidt believed he was complying with the applicable legislation.  Justice Tetley added that the extended period of time where regulatory enforcement procedures were not instituted may reasonably be concluded to have contributed to a mistaken belief on the part of Schmidt that he was in compliance with the law. 

Read the decision at: R. v. Schmidt.

CAFA Conference in Ottawa - February 2, 2012

Click here for registration form: REGISTRATION FORM.

Environmental Law appeal to be argued over Twitter

FOR IMMEDIATE RELEASE                                           December 13, 2011

Environmental law appeal to be argued over Twitter – for the First time ever

VANCOUVER. On Tuesday, February 21^st, 2012 at 10am PST (1pm EST), West Coast Environmental Law will be hosting the world's first ever Twitter Moot.  Moot Courts – a simulated court hearing – are a common activity in law schools, but are new to most of Twitter's more than 300 million users.  Law students from 5 prominent Canadian law schools are scheduled to compete in this first moot. 

Law students will represent Canadian Universities – British Columbia, Dalhousie, Ottawa, Victoria and York (Osgoode Hall) – will represent parties and present their arguments over Twitter in a simulated appeal of an actual court case: West Moberly First Nations v. British Columbia.  The judges confirmed to hear the appeal (a third judge is still to be announced) include:

• William Deverell (lawyer and author of the critically-acclaimed Arthur Beauchamp Mystery novels); and
• Omar HaRedeye (lawyer, blogger and one of Canada’s top 24 social media influencers according to Canadian Lawyer Weekly).

“Legal argument is not often limited to 140 characters or less,” said Jessica Clogg, Executive Director of West Coast Environmental Law. “But Twitter is the perfect medium to raise public awareness about how the law can help protect the environment.”

“The Twitter Moot will tell the story of an Aboriginal Nation fighting to preserve their relationship with the land against coal mining, and of the complicated questions of law and values that come with that conflict,” said Andrew Gage, one of the Moot’s organizers. “Tweeps [Twitter users] interested in law, the environment or aboriginal issues will definitely want to follow our Twitter Moot.”

Members of the public seeking to follow the moot can follow www.twitter.com/WCELaw/twtmoot, or can visit West Coast’s website at www.wcel.org/twtmoot/  Visit the web pages of the individual teams to leave advice or good wishes to the teams.  The Hashtag for the Twitter Moot is #twtmoot. 

West Coast Environmental Law thanks the sponsors of the Twitter Moot, or #twtmoot, including Iler Campbell LLP, McCarthy Tetrault, Miller Thomson LLP, Saxe Law Corporation, Skunkworks Communications, and Willms & Shier Environmental Lawyers.

- 30 -

For more information contact:

Andrew Gage, Staff Lawyer, West Coast Environmental Law – 604-601-2506 (Vancouver) or 250-412-9784 (Victoria)

Jessica Clogg, Executive Director, 604-601-2501.

The TwtMoot Web Pages are available at wcel.org/twtmoot.

OEB dismisses most of gas storage compensation claim

The Ontario Energy Board (OEB) has recently decided a gas storage case that follows on the heels of a Court of Appeal decision that determined that the OEB has exclusive jurisdiction to decide questions of compensation.  The applicants before the OEB were the claimants in the case dismissed by the Court of Appeal.  The applicants made an application to the OEB under section 19 and section 38(2) of the Ontario Energy Board Act, 1998 for a number of heads of relief.  In particular, the application under section 19 was for an order of the OEB determining that the contracts between the applicants and Union Gas Limited have been terminated.  The application under section 38(2) was for an order determining the quantum of compensation to which the applicants were entitled.

The OEB has now partially dismissed the application on a motion for summary judgment filed by Union Gas Limited.  In doing so, the OEB applied the test under Rule 20 of the Ontario Rules of Civil Procedure.  The OEB was satisfied that there was no genuine issue requiring trial with respect to at least part of the claim made by the applicants.  Union made two arguments on why the application should not be heard by the OEB.  Firstly, Union argued that there was significant delay on the part of the applicants bringing the application.  Secondly, union argued that it had binding compensation agreements with the applicants, which, together with the OEB's 1993 gas storage area designation order, have superseded any prior agreement between Union, its predecessors, and the applicants.

The OEB found that Union's rights to inject gas into, store gas in and remove gas from the Edys Mill Pool, and to enter into and upon the land in the area and use land for such purposes was governed solely by the designation order, and has been since 1993.  The designation order supersedes any previous agreement with respect to Unions rights to inject store and remove gas.  Whether previous contracts between the parties relating to the right to inject, store or remove gas have been formally canceled or not is essentially irrelevant as these rights are now governed by the designation order.

It was also noted by the OEB that the applicants' allegations of unspecified breaches of the designation order were not supported by any evidence or particulars.  Even if there had been breaches of the designation order, it was not clear to the OEB that such breaches would be the proper subject of a hearing under section 38 of the Act.  As there was no basis for any finding in this proceeding that Union had committed any breaches of the designation order, the OEB dismissed claims based on those alleged breaches.

With respect to just and equitable compensation under section 38 of the Act, the OEB determined that it had no jurisdiction over gas storage on the applicants' lands during the period prior to the designation order.  During the period from the designation order in 1993 to 1999, the OEB determined that the applicants had been paid compensation by Union pursuant to Unions gas storage leases.  Therefore, the OEB dismissed the claims for compensation for the period 1993 to 1999.

The period 1999 to 2008 was covered by a compensation order made by the OEB.  The applicants were members of the Lambton County Storage Association (LCSA), which had negotiated an agreement with Union with respect to compensation.  The board ruled that it had dealt with compensation issues in that order in a final manner and that no party affected by it may seek additional or other relief for the period of time it covers.  The fact that the OEB has jurisdiction over compensation does not mean that the OEB can revisit the issue.

The OEB accepted that it could hear an application with respect to compensation owed to some of the applicants for the post-2008 period.  There was no agreement in place between Union and some of the applicants and the OEB could set the level of compensation under section 38 of the Act.

Read the OEB decision at: Knight et al. v. Union Gas.

Court throws out damages claims related to municipal drainage repairs

The Ontario Superior Court has dismissed a claim by a landowner for damages relating to a municipal drain (the "Cazabon Drain") located on the landowner's property.  The landowner claimed damages for nuisance (for unnecessary damage caused by undue delay by the municipality to remedy a drain problem), damages for negligence (for poor quality of workmanship in relation to repairs undertaken), and damages for "intentional infliction of economic harm" and "intentional infliction of mental suffering".  These last two claims were apparently related to the harm the landowner's reputation suffered after the municipality obtained a permanent injunction against him under the Drainage Act to prevent interference with efforts to repair the drain.

On a summary judgment motion by the municipality, the Court dismissed the landowner's claims for nuisance and negligence on the basis that insufficient notice of the claims as required by Section 111 of the Drainage Act had been given.  The judge allowed, however, that the landowner could commence new claims for nuisance and negligence.  The claims for economic harm and mental suffering were dismissed outright on the basis that there was no issue for trial. 

The Court also noted in the course of its decision that claims for damages related to the construction or repair of drainage works do not necessarily have to go to the Agricultural, Food and Rural Affairs Tribunal.  The Tribunal does not have exclusive jurisdiction over such claims.  The municipality had argued in this case that the landowner's claim based on negligence should be dismissed because it should have gone to the Appeal Tribunal.

Read the decision at: Hud v. West Nipissing.

TransCanada plans removal of 5.6% of 14,000 km of pipelines on abandonment

TransCanada Pipelines Limited has also submitted its application to the NEB for approval of its abandonment costs estimates.  TCPL has over 14,000 km of pipelines in Canada (not including the Keystone), more than half of which run through agricultural land.  Of the almost 8,000 km of pipe through agricultural lands, TCPL proposes to remove 1.7% on abandonment.  The rest of the pipe will be left in the ground with no continuing protection going forward. 

Read TransCanada's application at: TransCanada Preliminary Abandonment Costs Estimates. 

Enbridge plans to remove 0.6% of its pipelines on abandonment

Enbridge Pipelines Inc. plans to remove only 0.6% of its nearly 8,000 km of pipelines in Canada at the time of abandonment.  For agricultural land, only lands with "prospective future development" would have pipelines removed.  Pipelines would be abandoned in place in all other agricultural land with no "special treatment" for the pipelines.  This would include pipelines with a diameter of up to 48 inches.  More than 5,000 km of Enbridge pipelines run through cultivated land.   The 0.6% figure contrasts sharply with the 20% number identified by the National Energy Board (NEB) in its abandonment funding documentation.

Enbridge has applied to the NEB for approval of its plan for abandonment funding purposes.  The documents comprising Enbridge's application can be found at: Physical Plans for Abandonment and Preliminary Cost Estimates. 

Enbridge's application includes excerpts from a Praxis Research study conducted for the Canadian Energy Pipeline Association (CEPA).  The study consisted of a landowner survey, and Enbridge says that its abandonment plans took the results of the survey into consideration.  However, more than 50% of respondents with Enbridge pipelines expressed concern about Enbridge pipelines being left in the ground.  Read the study excerpt at: CEPA Landowner Survey.

Enbridge Line 9 Hearing Order Here

Click here to view the NEB Hearing Order for the Line 9 Reversal Project: Hearing Order.

NEB to hold oral public hearing for Enbridge Line 9 Reversal Application

The National Energy Board (NEB) announced yesterday that it will convene an oral public hearing to review Enbridge's application to reverse the flow of its Line 9 oil pipeline through southern Ontario.  The pipeline has been flowing westward since 1999.  When initially constructed in 1975, the flow direction was eastward. 

The Draft List of Issues for the hearing includes the need for the project; the engineering design and integrity of the pipeline, including the potential effects of flow reversal; contingency planning for spills, accidents or malfunctions, during construction and operation of the pipeline; the potential environmental and socio-economic effects of the project; the project’s potential impacts on Aboriginal interests; and its potential impacts on affected landowners.

Financial assistance will be made available through the Participant Funding Program to "applicants who meet the criteria and can demonstrate a need to support their timely and meaningful involvement in the proceeding."

CAFA's latest farm advisor directory now available!



Click on cover to view Cultivating Business

Court declines to order Ontario's Chief Medical Officer of Health to be cross-examined in wind farm case

On September 12, 2011, Shawn and Trisha Drennan commenced an application against a number of parties connected to Ontario wind farms (see Notice of Application).  They allege that they are facing a pending windfarm of upwards of 150 turbines (Kingsbridge II) in which one of the turbines will be as close as 650 metres from their home.  Their goal in the application is to obtain a declaration that they are not bound by non-disclosure clauses contained in buy-out agreements of properties to be used as a site for the wind turbines.  Their position is that they own property in the proximity of the planned wind farm and that their efforts to gather “key health information” in order to halt the process have been impeded by these clauses.   They claim that the clauses contravene the public interest as they conceal “serious public health and safety concerns” by private contract. 

The Drennans brought a motion to compel Dr. King, the Chief Medical Officer of Health for the province of Ontario, to be cross-examined as part of the overall application.  They are seeking evidence about the adverse health effects associated with living in close proximity to a wind farm “in anticipation of an appeal of the project’s approval to the Environmental Review Tribunal” (hereinafter referred to as the ERT).   They say they need the data for an expert’s report, which they claim would have to be prepared.  During the hearing of the motion on November 4, 2011, counsel for the Drennans provided two grounds for which Dr. King should be examined as part of the application:

1)      In her role as chief medical officer of Ontario, Dr. King can provide “valuable evidence with respect to the effect” of the non-disclosure clauses; and

2)      In her report, the doctor makes reference to a report being prepared by the Ministry of the Environment.  The second purpose for summoning her to give evidence was apparently to ask if the report is available now and if so, to get a copy of it from her. 

Master Joan Haberman, who heard the motion, found that the Drennans failed to meet their onus of providing a reasonable evidentiary record on which she could conclude that Dr. King "probably has any information in the nature of that sought from her or that relates to any of the matters that arise on the pending application."  She dismissed the motion and asked the parties to deliver submissions on costs.

Read the decision at: Drennan et al v. 2270573 Ont. Inc. et al.

Canadian Association of Farm Advisors (CAFA)



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Court dismisses contamination claim against former gas station as out of time

The Ontario Superior Court of Justice has thrown out a contamination claim against a former gas station as being out of time.  The Defendants in the claim, McColl-Frontenac Inc. and Imperial Oil Limited, previously owned and/or operated a gas station on the lands at issue in the claim.  The Plainitffs, who later purchased the lands from intermediate owners, claimed that contamination on the property was caused by the former gas station operation. 

The Defendants brought a motion for summary judgment asking that the Court dismiss the claim based on the expiry of the relevant limitation period.  In this case, the limitation period was two years and had expired before the Defendants say the Plaintiffs knew they had a claim or should have known they had a claim against the Defendants. 

The evidence showed that the Plaintiffs obtained environmental reports when they purchased their property (actually two contiguous properties owned by two companies with a common directing mind).  At least one of the reports identified that the property had been used as a gas station at some point in the past.  The Defendants argued that a reasonable person would have made inquiries to find out who owned/operated the gas station.  The Court agreed:

With the exercise of very little effort, between March 2006 and May 2006, the plaintiffs could quickly have determined that McColl-Frontenac and Texaco (now Imperial Oil) had leased the Bolton Oak property in the 1950s and 1960s.  This information could be obtained by searching publicly accessible records at the land registry office and entails minimal expense.

[...]

Put another way, it would be glaringly apparent to any reasonable commercial land purchaser acquiring land known to contain petroleum contamination that, as between:

            a)         prior use of the property as a veterinary hospital by the vendor; and

            b)         prior use (pre-vendor) of the property as a gas station;

the more likely, if not obvious, responsible candidates for the cause of the petroleum contamination would have been those associated with the gas station.

On this basis, the Court granted summary judgment and dismissed the claim.  The Court also rejected an argument that there was continuing damage that extended the time in which to bring an action.  The Court found that the Plaintiffs had not pleaded any continuing damage and, further, that there was no evidence of continuing damage (the evidence was that the contamination was there, but not increasing or changing).

Read the decision at: Bolton Oak Inc. et al. v. McColl-Frontenac Inc. et al.

Farmer ordered not to burn except in compliance with strict conditions

A 65-year old farmer in Waterdown (in the City of Hamilton, Ontario) has been ordered not to burn brush or tree limbs on his farm property except in accordance with conditions including:

1.      The fire is to be attended and supervised at all times.

2.      All fires are to be completely extinguished at the end of each working/burning day.

3.      Burning is not to take place when winds will cause smoke to be an annoyance to nearby property or roadways.

4.      All fires must be kept to a maximum size of 2m x 2m x 2m in height.

5.      Only the burning of brush and tree limbs is permitted.

6.      Equipment capable of extinguishing the fire at any time conditions warrant is to be on site at all times burning is carried out (i.e., Portable fire extinguishers, garden hose, portable pump and hose, bobcat etc.).

7.      The owner must contact the Ministry of Environment and comply with the Environment Protection Act.

8.      Open air burning shall not be carried out on Smog Alert days as declared by the City of Hamilton.

9.      No more than three piles at the current location to be burned at a single time.

10.  An area of 3m is to be cleared of all vegetation around the perimeter of each of the piles.

The fire inspection order was initially issued to the farmer in 2001.  In 2002, the order was appealed unsuccessfully to the Fire Safety Commission.  However, in 2004, the Superior Court of Justice allowed an appeal of the Commission decision on the basis of insufficient reasons.  A second Commission hearing was held in 2009.  Again the Commission upheld the inspection order.

Recently, the Superior Court of Justice heard an appeal by the farmer of the second Commission decision.  In dismissing the appeal, the Court ruled:

The Commission’s reasons, taken as a whole, are transparent, intelligible and justifiable.  We find no error, in fact or law, no misapprehension of the evidence and no miscarriage of justice.  It was open to the Commission to find that the appellant’s proposed burn without each of the conditions would, on a balance of probabilities, be unsafe and pose a potential fire hazard to him, his neighbours and drivers travelling on adjoining highways.  In doing so, the Commission considered the totality of the evidence and its findings were reasonable and well-supported by the evidence.  In particular, its findings in respect of each of the impugned conditions met the standard of reasonableness.

The decision of the Commission clearly falls within the range of possible, acceptable outcomes that are defensible from a factual and legal perspective.

Read the decision at: Veri v. Hamilton (City).

Appeal tribunal dismisses Manitoulin Island farmer's bid for chicken quota

Max Burt, a second generation poultry farmer from Gore Bay on Manitoulin Island, has lost his appeal to the Agriculture, Food and Rural Affairs Tribunal on the issue of chicken quota.  He had requested that the Tribunal reverse the refusal of the Chicken Farmers of Ontario (CFO) to give him 2,040 units of quota to produce and market chicken to satisfy what he believes to be a local market demand.  In the alternative, Burt sought an exemption from the requirement for quota.  In asking to be provided with quota, Burt relied on the historical production of his father, Edward Burt, during the original qualifying period for broiler chicken quota in 1964-65. 

The Tribunal saw the essence of the appeal as a request either for free quota or an exemption from quota.  In its view, the absence of a compelling and satisfactory reason for the 46-year delay alone was sufficient reason to deny the request for a qualifying period chicken quota allotment.  Further, the Tribunal found that Max Burt failed to prove qualifying production during the 1964-65 period and that he was not actually a producer during that time (his father was).  The Tribunal was unable to find any authority on which it could extend the qualifying quota from father to son.

On the issue of the exemption, the Tribunal found that the request for an exemption was based on financial reasons - affordability.  In dismissing this request, the tribunal wrote:

In our view, affordability cannot be the basis for the Tribunal to grant Max Burt an exemption from the Regulation, so as to permit him to produce and market 2,040 units of chicken. If we were to use affordability as an exemption criterion, it would render CFO's existing exemption policy, as reflected in section 2.02 of the Regulation, meaningless. Further, treating affordability as an exemption criterion could open a flood of exemption applications from some, if not all the other 14,000 registered chicken growers in the province. Finally, treating affordability as an exemption criterion would eventually undermine the chicken quota system, which is the foundation of the chicken supply management system in Ontario.

Read the decision at: Max Burt vs Chicken Farmers of Ontario.  The decision includes a useful summary of the history of chicken supply management in Ontario.

Alliance Pipelines told its pipeline doesn't meet safety requirements for location: Updated

The National Energy Board (NEB) has made a ruling that the Alliance Pipeline in area of the Alexis Casino development in northwestern Alberta is not satisfactory for use there under current conditions.  Various requirements for pipeline specifications and operations depend on class location.  Class location is generally determined on the basis of how many people live and work in the vicinity of the pipeline.  Class 1 locations feature low density populations.  The Alexis Casino segment of the Alliance high-pressure gas pipeline is currently designated as a Class 2 location, but the NEB had suggested to Alliance that it would become a Class 3 location due to the development. 

Alliance sought to maintain the Class 2 designation so that it could continue to use the pipeline as constructed at its current operating pressure.  It argued that it has never seen more than 110 occupants during any visits to the casino since early 2008.  Alliance estimates that up to 842 people can be present at the Casino site at a given time.  Alliance has installed yellow-coloured reinforced concrete slabs over the pipeline as protection against any potential mechanical damage from equipment contact, three strips of yellow warning tape, and line makers along the right of way.  It contends that these safety measures are sufficient to allow the pipeline to continue to operate under a Class 2 location designation.

The NEB disagreed with Alliance.  The Board was of the view that the probability that significantly more than 20 persons could be present at the Casino site is high enough to, on its own motion, conclude that the designation of the area as Class 2 does not adequately address the possible consequences of failure at the Casino site.  The Board found that the consequences of a failure at the Alexis Casino pipeline segment are potentially severe, given that up to 842 individuals concentrated in a localized, constrained area could be impacted.  The pipeline must therefore be in compliance with Class 3 location requirements.

Despite its ruling, the NEB has given Alliance until May 31, 2013 - one and a half years - to bring the pipeline into conformity with the requirements that currently apply to the pipe.

Read the NEB decision at: Letter Decision.

UPDATE:

Here is a diagram showing the proximity of the NPS 36 high pressure gas line to the Casino development.

Keystone pipeline decision shelved until 2013

The US State Department has ordered an environmental assessment of the proposed Keystone XL pipeline in the US, meaning that the project is shelved until after the 2012 Presidential Election.  Read CBC.ca's story at: Keystone XL delayed.

Ontario Court dismisses claim by dairy farmers re stray voltage

Ron and Helen Cowan purchased a farm near the Village of Earlton in the fall of 1991.  They moved to the farm in the spring of 1992 and began a dairy farming operation there later that same summer.  Although the farm seemed to enjoy a measure of success in its early years, it was later plagued by poor milk production, both in terms of quantity and quality.  By 2002 circumstances were such that they had no choice but to shut down their dairy farm, and to sell their herd and dairy quota. 

In an action against Hydro One, the Cowans alleged that the decline in their herd’s milk production was due to the presence of tingle voltage (or stray voltage) caused by the Hydro One system.  A trial was held to determine if this was so and to assess the damages alleged to have been suffered.  The Cowans claimed negligence and breach of contract against Hydro One and, in addition, made a claim for punitive damages.  Justice Robbie Gordon dismissed the farmers' claims, finding that causation was not proved (i.e. the Cowans failed to show that their damages, which would have been assessed to be $823,053.77, were caused by Hydro One).

Tingle voltage and stray voltage are terms used to refer to the same phenomenon, namely, the difference in voltage potential between two points that a farm animal might make contact with at the same time.  The word “potential” is used because it is only when an animal touches the two objects, each with a different voltage potential, that its body completes an electrical circuit allowing current to flow from one object, through the animal, to the other object.  If the difference in voltage between the two contact points is high enough, the animal may feel a tingling sensation, and hence the term tingle voltage.  In fact, what the animal is exposed to is the current in the circuit, not the voltage on the points of contact.

On the question of negligence, Justice Gordon ruled that Hydro One owed a duty of care to the Cowans to ensure that electricity was safely delivered to them.  Also, their relationship was of sufficient proximity to warrant the existence of the duty of care - it would be reasonably foreseeable that a failure to provide electricity safely could result in harm to Hydro One's customers.  In order to prove negligence, the Cowans had to prove conduct on the part of Hydro One that created an unreasonable risk of harm to them.

Justice Gordon found that tingle voltage levels in the Cowan barn were prone to frequent fluctuation due to the loads in use.  Tingle voltage levels would also vary dramatically depending upon where in the barn one is situated.  He was satisfied that on a given day, steady state tingle voltage levels at certain cow contact points will regularly exceed one volt; that on a given day, but with less frequency, steady state tingle voltage levels at certain cow contact points will exceed two volts but not exceed three volts; and, that on a given day, but with much less frequency, certain cow contact points will be exposed to transient tingle voltage levels in excess of three volts.

Justice Gordon also determined that, but for the Hydro One system, the tingle voltage on the Cowan farm was reduced to negligible levels.  The question then was whether there any conduct on the part of Hydro One that created an unreasonable risk of harm (i.e. negligent conduct).  The Cowans alleged: (1) Failure to ensure that the primary neutral was directly bonded to the secondary neutral by a jumper wire; (2) improperly placement of a sentinel light on the transformer pole; (3) failure to maintain adequate grounding along the F2 line; (4) failure to follow its standards and procedures for testing tingle voltage and resolving the tingle voltage issue at the Cowan farm; (5) failing to monitor and control current and voltage imbalance on the distribution system; and (6) failing to maintain a primary neutral wire of sufficient capacity. 

Although Justice Gordon found that, in some instances, Hydro One could have done things differently, he noted that the standard of care expected of Hydro One is not perfection.  That it could have taken steps that it did not was not the end of the inquiry.  It was also necessary to determine whether those actions breached the required standard of care, that is, whether those actions created an objectively unreasonable risk of harm having regard to the likelihood of a known or foreseeable harm, the gravity of that harm, the burden of cost which would be incurred to prevent the injury, industry practice, compliance standards, and statutory or regulatory standards.

Following his analysis, Justice Gordon found that Hydro One's practice of notification of farmers about the risks of tingle voltage was inadequate.  It was not enough to stuff bills with an information pamphlet on a few occasions.  The standard of care required that Hydro One have direct contact with customers it knew to be potentially vulnerable to advise them of increased risk.  Therefore, the Cowans were successful in establishing that Hydro One owed them a duty of care and breached the standard of care.  However, it still remained to show that they had suffered damages that flowed from the breach of the standard.

Justice Gordon accepted that voltage of the level and nature of those found to exist on the Cowan farm could, over the long term, lead to health and production issues for dairy cows.  He was not satisfied that such voltage levels adversely affect production without a contemporaneous effect on health, but he was satisfied that such voltage levels can lead to various health problems which can ultimately affect production.  The question was still whether the damages suffered by the Cowans were caused by the negligence of Hydro One. 

In the end, the Cowans were unable to prove this element of causation.  Justice Gordon found that Hydro One proved on a balance of probabilities that inadequate farm labour likely contributed to production problems in the dairy herd.  Other contributing factors could not be identified because of the inadequacy of the records kept by the Cowans.  On the whole, Justice Gordon was not satisfied on a balance of probabilities that tingle voltage was a contributing factor to the production issues experienced on the Cowan farm.  That it would have had a negative effect on production was belied by: (1) The positive production levels for the farm in 1995 and 1996; (2) the acceptable somatic cell counts recorded for most of the time the farm operated; and (3) the lack of health issues on the farm that ought to have been apparent had tingle voltage been causing significant stress to the cows.

Because causation was not proven, the Cowans' claim for breach of contract failed as well.  Justice Gordon also addressed the defence put forward by Hydro One based on its "Conditions of Service", which are implied terms of its contract with its customers.  The Conditions of Service currently limit Hydro One's liability for damages to those arising out of its negligence and exclude any liability for "any loss of profits or revenues, business interruption losses, loss of contract or loss of goodwill, or for any indirect, consequential, incidental or special damages, including but not limited to punitive or exemplary damages, whether any of the said liability, loss or damages arise in contract, tort or otherwise."  These terms are set down by the Ontario Energy Board through the Distribution System Code.  Justice Gordon ruled that the terms did not affect the Cowans' claim, as they came into effect in 2002 - long after the alleged negligent conduct of Hydro One.

Read the decision at: Cowan v. Hydro One.

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Don’t miss one of the biggest agricultural events of the year.

At FCC Forums, speakers share their stories of success and overcoming challenges. These events are an opportunity to learn, inspire big ideas and network with business owners and operators just like you.

Sign up now for this year's Forum.

Jamie Clarke – Extreme Adventurer, Author and Inspirational Speaker

Jamie Clarke is an entrepreneur in the business of adventure. On May 23, 1997, after two previous attempts, Jamie became the ninth Canadian to summit Mount Everest. He did it again in 2010 as leader of Expedition Hanesbrands. Jamie has followed his passion for adventure from Mount Everest to climbing the Seven Summits and across the desolate sands of Arabia. He relates the importance of overcoming the fear of rejection as a major factor in reaching one’s goals and demonstrates how the life lessons he learned during his Mount Everest expeditions apply to everyday challenges.  Join Jamie at this year’s FCC Forum where he will inspire you to be an adventurer on your own journey.




Michael “Pinball” Clemons – Vice-Chairman of Toronto Argonauts Football Club, Former CFL Head Coach and Player

The name “Pinball” Clemons brings to mind a remarkable football player, outstanding sportsman and prominent community member. As a former all-star running back, Grey Cup-winning coach, President and CEO, and now Vice-Chairman for the Toronto Argonauts, Pinball is a man of unquestionable character and spirit. Not only is he renowned for his achievements on the football field, Pinball’s aptitude for captivating and empowering an audience is undeniable. His presentation, Winning Against the Odds, exemplifies the capabilities of teamwork and can inspire you to tackle any challenge facing your operation.


Dr. John G. Fast - President, Family Enterprise Solutions

Dr. Fast is an acclaimed author and sought-after inspirational speaker on topics related to family business, retirement, work-life balance, leadership and workplace integrity. He’s currently the founding partner and president of Family Enterprise Solutions, a management consulting and training organization through which he has emerged as one of Canada’s leading experts on family business. Dr. Fast’s presentation, Planning for Success, will help you create a blueprint for the long-term success of your operation.

Check out interviews with last year’s speakers

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FCC Forums 2011-12

Location	Date
Kingston, Ontario	Tuesday, November 22
Vaughan, Ontario	Thursday, November 24
Regina, Saskatchewan	Wednesday, November 30
London, Ontario	Tuesday, December 6
Red Deer, Alberta	Thursday, December 8
Winnipeg, Manitoba	Tuesday, March 6
Moncton, New Brunswick	Friday, March 9
Saskatoon, Saskatchewan	Tuesday, March 13
Lévis, Quebec*	Friday, March 16
Lethbridge, Alberta	Tuesday, March 20

*Presented in French

Agricultural Outlook Seminar for Agri-Business - London, ON



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B.C. MLA challenges NEB on changes to its Strategic Plan

Gary Coons, the MLA for North Coast in British Columbia, has sent a letter to the National Energy Board (NEB) expressing his concerns about changes to the NEB's Strategic Plan language.  He notes a number of significant changes, including the replacement of the NEB's mission statement.  Previously, the NEB sought to "promote safety, security, environmental protection and efficient energy infrastructure and markets in the Canadian public interest".  The NEB now says that "WE REGULATE PIPELINES, ENERGY DEVELOPMENT AND TRADE IN THE CANADIAN PUBLIC INTEREST".  Coons asks whether this change signifies that safety, security and environmental proteciton are no longer within the NEB's mandate.  Coons also notes that the Board has removed the language referring to the "responsible development" of the energy industry.  He says that these changes are of particular concern in the context of the ongoing Enbridge Northern Gateway Project application and in the context of growing public concern about the influence of "big oil" interests on government.

Pipeline Abandonment Plan foreshadows future for landowners

As part of its application for a project approval from the National Energy Board (NEB), Vantage Pipeline Canada ULC (Vantage) has filed a "Preliminary Project Abandonment Plan and Cost Estimate".  Vantage plans to construct 578 km of 10" pipe through Alberta and Saskatchewan to the North Dakota border.  The terrain through which the pipeline will cross is primarily farmland - either in cultivation or pasture.  For all but 1 km of the proposed route, Vantage says that it will abandon the pipeline in place.

Only lands where there is prospective "future development" will see the pipeline removed from the ground once it has outlived its usefulness to Vantage. 

Previously, the NEB had used an estimate of 20% pipe removal on abandonment as part of the "base case" for calculating future abandonment costs (for the purpose of setting advance abandonment funding).  The 20% figure has obviously been abandoned by pipeline companies and the NEB.  The cost of pipeline removal far outweighs the cost of doing nothing.  Likewise, the cost of advance funding for doing nothing is far cheaper than advance funding for pipeline removal. 

It may be that the preference of some landowners in the future will be to leave pipelines in place rather than to have them removed on abandonment.  However, the decisions being made now by pipeline companies and endorsed by the NEB are likely to limit any choice landowners might have in the future.  Many landowners today probably don't even know that their hands are being tied in this way. 

If the NEB's abandonment funding program is premised on the assumption that pipeline companies will need to do virtually nothing in the future to deal with their obsolete infrastructure, then it is a failure.  The funding will be insufficient to allow for future contingencies, let alone to allow for any landowner choice.

Ministry of the Environment News Release: $52,500 fine for constructing wells without licence

Lloyd Trodden Fined $52,500 For Constructing Wells Without A License

BRACEBRIDGE – On July 19, 2011, Lloyd Trodden pleaded guilty to seven violations under the Ontario Water Resources Act in relation to the construction of wells without a well contractor license.  In February 2009, the ministry received a complaint from a well owner that a newly constructed well was contaminated with gasoline. An inspection by ministry officials confirmed that the drinking water well was contaminated with a petroleum product. The inspection process revealed that Mr. Trodden constructed the well and that he did not possess a valid well contractor license to construct wells in Ontario.  Following an investigation, a number of additional wells were discovered that had been constructed by Mr. Trodden.  A ministry record search indicated that Mr. Trodden did not have a valid Well Contractor Licence when the wells were being constructed.

Mr. Trodden was charged following an investigation by the ministry’s Investigations and Enforcement Branch.  He was fined a total of $52,500 plus victim fine surcharges and given one year to pay the fine.

Ministry of the Environment News Release: $4,000 fine for selling pesticides without licence

Justin Vanderheide Fined $4,000 For Selling Pesticides Without A Licence

CAYUGA – On July 8, 2011, Justin VanDerheide was convicted on three violations under the Pesticides Act for offering the sale of a pesticide and selling a pesticide without a vendor’s licence.  The Court heard that Mr. VanDerheide resides in Dunnville, Haldimand County.  In November 2010, the ministry found an advertisement in a trade publication newspaper, dated offering Weed-Master 41 and Wiseup glyph sate for sale. Similar advertisements were also found on an advertising website.  The advertisements in the newspaper and on the website were later determined to belong to Mr. VanDerheide. Weed-Master 41 is a pesticide that requires a licence to sell.  A search of ministry records determined that Mr. VanDerheide did not possess a vendor’s licence.

Mr. VanDerheide was charged following an investigation by the ministry’s Investigations and Enforcement Branch.  He was fined 4,000 plus a victim fine surcharges and was given 15 days to pay the fine.

Ministry of the Environment: $48,000 fine levied for manure discharge

Bernardus Johannes Joseph Debeer Fined $48,000 For Manure Discharge

THUNDER BAY– On August 8, 2011, Bernardus Johannes Joseph DeBeer pleaded guilty to one violation under the Ontario Water Resources Act for a discharge of corn silage and manure into the Curry Municipal Drain and Reynolds Creek.

The Court heard that Mr. DeBeer is the president of a dairy and veal farm in the Municipality of South-West Oxford, Ontario.  In 2009, the ministry received a report of dead fish in Reynolds Creek.  The ministry conducted sampling on the farm and observed that run-off from the corn silage was entering catch basins. Mr. DeBeer confirmed that he had been receiving corn silage for more than a week and also confirmed that the catch basins were connected to the Curry municipal drain which flowed into Reynolds Creek.

Mr. DeBeer was charged following an investigation by the ministry’s Investigations and Enforcement Branch.  He was fined $48,000 plus a victim fine surcharge and was given six months to pay the fine.

Ministry of the Environment News Release: Abandoned Well Violation

Amethyst Well Drilling Ltd. Fined $2,500 Plus A Court Order For Restitution Of $6,619 For An Abandoned Well Violation

THUNDER BAY– On July 29, 2011, Amethyst Well Drilling Ltd. pleaded guilty to one violation under the Ontario Water Resources Act for failing to ensure that when abandoning a well, the well, including any annular space, is plugged to prevent any movement of water.

The Court heard that the company constructs potable water wells. The property owner of a residence in the Township of Neebing hired the company to construct a well on the property. In 2009, the property owner contacted the ministry with a complaint regarding the construction of his well since the water was not clear and remained cloudy in appearance.  It was discovered that in January 2008, the owner of the company had attended the site and discovered the casing was not in the bedrock.  In May 2008, he returned to try to repair the well, but the well had collapsed.  The well was not sealed from the bottom as required.  A new well was drilled nearby on the north side of the owner’s driveway.  The second well was drilled in October 2008 and in the process of developing the well, the water pumped remained very turbid, and a sink-hole appeared where the first well had been drilled.

The company was charged following an investigation by the ministry’s Investigations and Enforcement Branch.  The company was fined $2,500 plus a victim fine surcharge and was given 12 months to pay the fine. A court order was also issued ordering the company to pay restitution in the amount of $6,619 by September 30, 2011, for reasonable expenses incurred by the property owner, due to the damage to his property.

Ministry of the Environment News Release: Fine for advertising pesticides for sale without licence

Joseph Domotor Fined $2,000 For Advertising Pesticides For Sale Without A Licence

BRANTFORD – On June 28, 2011, Joseph Domotor pleaded guilty to one violation under the Pesticides Act for the placement of an advertisement offering the sale of pesticides without a vendor license.

The Court heard that Mr. Domotor operates a used car business in Brant, Ontario.  In July 2010, ministry staff placed a call to the telephone number listed in an advertisement on a website, offering the sale of pesticides. Mr. Domotor confirmed that he had pesticides for sale.  Some of the pesticides offered for sale were prohibited from being used in Ontario. In August 2010, ministry staff visited the business site and observed pesticides on site, including bottles of Wilson Total Wipeout Weed & Grass Killer concentrate – products no longer available for purchase in Ontario. 

Mr. Domotor was charged following an investigation by the ministry’s Investigations and Enforcement Branch.  He was fined $2,000 plus a victim fine surcharge and given six months to pay the fine.

FRACKED: A PERSONAL ACCOUNT OF LIVING ON THE SHALE

From theclean.org:

FRACKED: A PERSONAL ACCOUNT OF LIVING ON THE SHALE

October 26, 2011: Nothing can prepare a person for the reality of high-volume "fracking"; certainly not the coaxing of suave salesmen who convince landowners to sign leases by telling them that they've won "the natural gas sweepstakes." And certainly not their description of benign completed gas wells that stand in green meadows, silently pumping money out of the ground.

When the frackers come, they arrive like an invading army:

Trucks by the hundreds, tankers, dump trucks, drilling rigs, fracking rigs. Five-acre drilling pads were bulldozed in the middle of farmers' best fields, million-gallon ponds were installed, roads were built, woods and fields were trenched and bulldozed for tie lines. Drilling rigs went up at an unbelievable rate. From one spot on our farm, I counted eight rigs.

Then the generators started. You could hear them a half-mile away.

Then the pumping stations - small, industrial sites with buildings and pipes sticking up out of the ground.

This is the scene as described by Libby Foust. Her family farm was the site of some of the first Marcellus wells in Bradford County, Pennsylvania.

Read the rest of the blog post at: theclean.org

Ministry of Environment News Release: Fines for gasoline spill

901659 Ontario Inc. O/A Dicola Petroleum, James Orr, Kathryn Gibson And Daniel Wilson Fined A Total Of $38,000 For Gasoline Spill

KINGSTON / BROCKVILLE – In June 2011, Daniel Wilson pleaded guilty to one violation under the Environmental Protection Act for failing to comply with a Provincial Officer Order by failing to submit a report in relation to the Kingston charge. In a related matter, in March 2011, 901659 Ontario Inc. o/a Dicola Petroleum, James Orr and Kathryn Gibson pleaded guilty to one violation each under the Environmental Protection Act for having control of a pollutant that spilled and failing to forthwith notify the ministry.

The Court heard that Dicola Petroleum is located in the Town of Perth and is a provider of petroleum products. Ms. Gibson is the president of the company and Mr. Orr is a truck driver for the company. Mr. Wilson is a co-owner of Franklin’s Marina located near Elgin. In May 2005, a gasoline spill occurred at the Marina while fuel was being delivered by the company, as a result of an overfill.  Gasoline discharged onto the ground and ran into a drainage ditch.  The spill was not reported to the ministry until 2008 by an engineering firm who was conducting a site assessment at the marina. Mr. Wilson disclosed that the spill had occurred on the property back in 2005. As a result, a Provincial Officer Order was issued, requiring a report to be prepared by a qualified consultant to describe the contamination and the proposed work needed to fully remediate it.

Following the laying of charges by the ministry’s Investigations and Enforcement Branch, the company was fined a total of $35,000. Mr. Wilson was fined $3,000 and Mr. Orr and Ms. Gibson were given suspended sentences.  The fines totaled $38,000 plus victim fine surcharges and they were given six months to pay.

CBC's The Current - Keystone vs. Landowners

"In its bid to move unrefined bitumen from the oilsands of Alberta to refineries in Texas, TransCanada pipeline is finding some of its toughest opponents aren't environmentalists or regulators but the ranchers and farmers whose land the pipeline will cross."

This morning, the CBC Radio One program The Current looked into the relationship of landowners with the proposed Keystone XL pipeline in the United States (click here to see the program page and a link to the archived broadcast). 

 

I was asked by the program to comment on the existence of "eminent domain" law in Canada (here known as expropriation), as well as any differences between the challenges faced by pipeline landowners in Canada and those in the United States.  My comments come at the end of the program, just before the host notes that TransCanada declined an invitation to speak on the basis that it is still involved in eminent domain proceedings in the U.S.

2011 Ontario Farm Tax & Business Seminars announced

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Saskatchewan farmer acquitted of Stray Animals Act charges

A Saskatchewan farmer has been acquitted by the Provincial Court of three charges under the Stray Animals Act for "allowing his cattle to run unlawfully at large".  The Court found in the end that the farmer had made out the defence of due diligence.

The Court accepted the evidence of a neighbour that on August 31, 2010, she was in her house, when suddenly five or six bulls came into her yard, from all directions, and a couple of them started fighting.  Being afraid, she called the police, and a complaint ensued.  She said that either she or the police phoned the farmer to come and get the bulls.  The neighbour also stated that the cattle got into an organic alfalfa field, which her son was farming for her.  She made a complaint about the August 31, 2010 incident, as well as two subsequent incidents of the same sort.

In his defence, the farmer presented evidence of his general practices, including the maintenance of fencing.  He argued that he had exercised due diligence by checking his fences twice a week, and repairing breaks whenever they were located.  The Court found that the farmer's fencing was good and substantial, well-built and well-maintained.  In the end, the Court agreed that the farmer had exercised due diligence and was not guilty of the strict liability offences under the Act:

The test ... is whether or not Mr. Potoreyko has satisfied me, on a balance of probabilities, that he took all reasonable steps to avoid the doing of the prohibited act.  I am satisfied that he has met that test.  He is not required to guarantee that his cattle will not run at large.  I find that he took reasonable steps, in both patrolling his fence line, and in repairing the fence line when required, to prevent his cattle from running at large.

Read the decision at: R v Potoreyko.

Ontario Court of Appeal overturns $36 million Inco class action damages award

In July, 2010, I posted about a $36 million award of damages made in favour of residential property owners in the City of Port Colborne.  The owners had sued Inco in a class action over property value losses related to soil contamination.  Now, on appeal from the decision of the trial judge, the Ontario Court of Appeal has overturned the award.  The Court allowed the appeal, ordered that Inco be paid $100,000 for the costs of the appeal, and has asked for submissions on the costs of the trial. 

The issues on appeal were:

 i.                   Did the trial judge err in holding that the discharge of the nickel particles by Inco on to the property of the class members constituted an actionable nuisance?

 ii.                 Did the trial judge err in holding that Inco was liable for the discharge of the nickel particles under the rule established in Rylands v. Fletcher?

iii.            Did the trial judge err in holding that the claimants had established a diminution in value of their properties after September 2000?

iv.            Did the trial judge err in holding that assuming there was a diminution in the value of the properties after September 2000, that diminution was caused by the discharge of nickel particles on to the land?

v.            Did the trial judge err in failing to hold that the claim was time barred under s. 45(1)(g) of the Limitations Act?

The Court allowed the appeal on the basis that the property owners failed to establish Inco's liability under either private nuisance or the rule in Rylands v. Fletcher (which is basically that a landowner cannot allow a harmful substance to flow from his or her property onto a neighbouring property).  Alternatively, if liability had been found, the Court of Appeal would still have found that the property owners failed to prove that they suffered any damages. 

Here is some of what the Court said about the tort of nuisance:

People do not live in splendid isolation from one another.  One person’s lawful and reasonable use of his or her property may indirectly harm the property of another or interfere with that person’s ability to fully use and enjoy his or her property.  The common law of nuisance developed as a means by which those competing interests could be addressed, and one given legal priority over the other.  Under the common law of nuisance, sometimes the person whose property suffered the adverse effects is expected to tolerate those effects as the price of membership in the larger community.  Sometimes, however, the party causing the adverse effect can be compelled, even if his or her conduct is lawful and reasonable, to desist from engaging in that conduct and to compensate the other party for any harm caused to that person’s property.  In essence, the common law of nuisance decided which party’s interest must give way.  That determination is made by asking whether in all the circumstances the harm caused or the interference done to one person’s property by the other person’s use of his or her property is unreasonable:  Royal Anne Hotel Co. Ltd. v. Village of Ashcroft (1979), 95 D.L.R. (3d) 756 (B.C.C.A.), at pp. 760-61. 

[...]

In our view, actual, substantial, physical damage to the land in the context of this case refers to nickel levels that at least posed some risk to the health or wellbeing of the residents of those properties.  Evidence that the existence of the nickel particles in the soil generated concerns about potential health risks does not, in our view, amount to evidence that the presence of the particles in the soil caused actual, substantial harm or damage to the property.  The claimants failed to establish actual, substantial, physical damage to their properties as a result of the nickel particles becoming part of the soil.  Without actual, substantial, physical harm, the nuisance claim as framed by the claimants could not succeed.

On the rule in Rylands v. Fletcher, the Court wrote:

The rule in Rylands v. Fletcher imposes strict liability for damages caused to a plaintiff’s property (and probably, in Canada, for personal damages) by the escape from the defendant’s property of a substance “likely to cause mischief”.  The exact reach of the rule and the justification for its continued existence as a basis of liability apart from negligence, private nuisance and statutory liability have been matters of controversy in some jurisdictions:   see Transco plc v. Stockport Metropolitan Borough Council, [2004] 2 A.C. 1 (H.L.); Burnie Port Authority v. General Jones Pty. Ltd. (1994), 179 C.L.R. 520 (Aust. H.C.); Murphy, “The Merits of Rylands v. Fletcher”.  In Canada, Rylands v. Fletcher has gone largely unnoticed in appellate courts in recent years.  However, in 1989 in Tock, the Supreme Court of Canada unanimously recognized Rylands v. Fletcher as continuing to provide a basis for liability distinct from liability for private nuisance or negligence.  

[...]

There are various formulations of the rule found in the case law and the academic commentary.  The authors of The Law of Nuisance in Canada suggest different potential formulations, including one, at p. 113, that requires four prerequisites to the operation of the rule:

•        the defendant made a “non-natural” or “special” use of his land;

•        the defendant brought on to his land something that was likely to do mischief if it escaped;

•        the substance in question in fact escaped; and

•        damage was caused to the plaintiff’s property as a result of the escape.

The Court of Appeal found that there was no liability under this doctrine because Inco's use of its property was not a "non-natural use".

Finally, although the Court of Appeal did not have to address the limitation period issue in order to make its decision, it did provide a brief commentary on the issue because of its potential effect on future cases.  The Court cautioned that discoverability is often an individual issue requiring individual adjudication after common issues (such as liability and damages, in this case) have been decided.  The trial judge in this proceeding had made a ruling on a limitation period defence on the basis that "most property owners" would not have been aware of the potential effect of nickel contamination as of a certain date.  The Court of Appeal ruled that the limitation issue could not be decided in that way in the trial of common issues:

If, as the trial judge found in this case, the evidence does not establish that all class members were not aware of and ought not to have been aware of the material facts, then the application of the Limitations Act to the claims is an individual and not a common issue. 

Read the full decision at: http://canlii.ca/s/6lhbs.