Decision Date: April 9, 2009

Panel: David H. Searle, Roberta Gerath, R.G. Holtby

Keywords:  Waste Management Act – ss. 1 – definition of “effluent”, 13; Environmental Management Act – s. 140; Interpretation Act – ss. 35, 36; amended permit; sewage lagoon; groundwater; burden of proof; jurisdiction; precautionary approach; transitional provisions

The City of Cranbrook (“Cranbrook”) has a sewage treatment system that includes two storage lagoons.  Treated effluent is pumped to the lagoons for storage, and the effluent is disposed via spray irrigation on agricultural fields located primarily southeast of the lagoons.  This operation is authorized by a waste permit that was issued to Cranbrook in 1975.

In 1997, Canadian Pacific Railway (“CPR”) experienced some instability at its tracks approximately 3 miles north of Cranbrook’s sewage lagoons.  CPR retained an engineering firm to review the track instability and prepare a geotechnical report.  That report concluded that effluent seepage from Cranbrook’s lagoon #2 poses a risk to the stability of the tracks when the elevation of the effluent in the lagoon reaches 824 metres above sea level (“ASL”) and higher because it causes the natural groundwater flow to reverse and flow towards the tracks.

In April 1999, the Assistant Regional Waste Manager (the “Assistant Manager”), Ministry of Environment, Lands and Parks (now the Ministry of Environment), amended Cranbrook’s waste permit.  The amendments include a requirement that Cranbrook manage lagoon #2 so that the effluent level does not exceed 824 metres ASL.

Cranbrook appealed the amendments and requested that the Board set aside the condition that sets the maximum elevation of lagoon #2 at 824 metres ASL, or alternatively, vary the amendments by increasing the maximum elevation for lagoon #2 to 827.5 metres ASL.  In the further alternative, Cranbrook requested that it be permitted to construct an outfall from the lagoons to a nearby river.  Cranbrook also requested a stay of the amendments, which the Board denied (City of Cranbrook v. Assistant Regional Waste Manager, Appeal No. 99-WAS-23(a), May 10, 1999).

Ms. Ridge applied to the Board on behalf of the Fort Steele Residents (the “Residents”) for participant status in the appeal, based on their concerns that Cranbrook’s spray irrigation operation is contaminating groundwater.  The Board granted the Residents limited participant status (City of Cranbrook v. Assistant Regional Waste Manager, Appeal No. 99-WAS-23(b), August 20, 2002).

At the parties’ request, the hearing of the appeal was adjourned several times to allow the parties time to attempt to negotiate a solution.  At the parties’ request, the Board also attempted to mediate a resolution to the appeal.  Ultimately, the parties were unable to reach an agreement, and they requested that the Board adjudicate the appeal.

In addition to the issue of the appropriate maximum elevation for the effluent in lagoon #2, the parties raised legal issues regarding: the Board’s jurisdiction to make findings regarding the Residents’ evidence about Cranbrook’s spray irrigation system; the legal test for deciding the appropriate maximum elevation of lagoon #2; the burden of proof; and, the legislation that applies to the appeal.

The Board found that it is not bound by strict rules of evidence, and it has jurisdiction to consider new evidence presented by the Residents that was not before the Assistant Manager, to the extent that the evidence is relevant to the permit amendments.  It is not unfair for the Board to consider the relevant portions of that evidence, because the parties were given an opportunity to respond to the evidence, although they declined to do so.

Additionally, the Board found that, contrary to Cranbrook’s submissions, the legal threshold for the Assistant Manager to exercise his discretion to amend the permit is not “reasonable certainty” that exceeding 824 metres ASL causes an adverse effect on the environment.  Rather, it is consistent with the relevant statutory provisions, and previous Board decisions, to take a cautious approach in assessing the potential risks associated with the elevation of lagoon #2, aimed at proactively preventing harm to the environment.

Similarly, the Board held that the evidentiary threshold for the Assistant Manager to exercise his amending powers is not “reasonable certainty”, but rather a “balance of probabilities”.  Moreover, the Board found that Cranbrook is responsible for leading sufficient evidence for the Board to conclude, on a balance of probabilities, that allowing the elevation of lagoon #2 to exceed 824 metres ASL will not create an unreasonable risk of harm to the environment.  It is insufficient for Cranbrook to simply seek to discredit the Assistant Manager’s evidence, or argue that CPR has not proved its case.

Regarding the applicable legislation, the Board noted that when the Assistant Manager issued his decision, the Waste Management Act empowered him to amend the permit, and it also provided Cranbrook with a right of appeal.  At that time, the Environment Management Act established the Board’s powers and procedures.  In 2004, those Acts were repealed and the Environmental Management Act, which regulates waste discharge and contains the appeal provisions, came into force.  Based on the relevant transitional provisions and the Interpretation Act, the Board found that the appeal was continued under the Environmental Management Act, but the Waste Management Act applies for the purposes of considering the merits of the amendments.  The Board also found that it was beyond its jurisdiction in this case to amend the permit to provide for an outfall as requested by Cranbrook, and in any case, there was insufficient information before the Board to justify authorizing an outfall.  The Board held that Cranbrook should apply under the current legislation if it wishes to install an outfall.

Finally, regarding the appropriate maximum elevation for lagoon #2, the Board found that the evidence clearly established, on a balance of probabilities, that the limit of 824 metres ASL is justified.  The Board concluded that there was overwhelming evidence that approximately 330,000 m3 of effluent escapes from lagoon #2 to the groundwater annually.  The Board also found that there was sufficient evidence to establish, on a balance of probabilities, that at elevations exceeding 824 metres ASL, effluent migrates underground to the CPR right of way.  The evidence indicated that some of the slope failures along CPR’s tracks were caused by a combination of unusual events of high precipitation and high ground water.  The Board held that the consequences of such failures are severe, and the risk of failure should be reduced by limiting the elevation of lagoon #2 so that seepage to the right of way is eliminated.  Consequently, the Board confirmed the requirement in the amendments that the elevation of lagoon #2 not exceed 824 metres ASL.

Regarding other aspects of the amended permit, the Board remitted the matter back to the Assistant Manager (now the Director) with a number of directions aimed at finding ways to minimize effluent leakage to the groundwater.  The Board also recommended that the Ministry attach appropriate conditions to Cranbrook’s spray irrigation system.

Accordingly, the Board dismissed the appeal, subject to certain directions.