Decision Date: March 7, 2008

Panel: Alan Andison

Keywords: Stay application; RJR-MacDonald

Howe Sound Pulp and Paper Limited (HSPP) operates a pulp and paper mill in Port Mellon, BC. In December 2007, the Director, Environmental Management Act (the “Director”) amended HSPP’s permit, which authorized the discharge of air contaminants from its facilities. The amended permit did not authorize the burning of coal in HSPP’s co-generation wood residue boiler at the mill. HSPP had conducted a coal burning trial using the boiler before the permit was amended, and sought to continue burning coal in the boiler to supplement its primary fuel, wood waste. HSPP appealed the Director’s decision and requested a stay of the decision pending the Board’s decision on the merits of the appeal.

In determining whether a stay ought to be granted, the Board applied the three-part test set out in RJR-MacDonald Inc. v. Canada (Attorney General). With respect to the first element of the test, the Board found that HSPP had raised serious issues to be tried, which were not frivolous, vexatious, or pure questions of law.

Regarding the second element of the test, the Board found that the evidence presented by HSPP did not establish that irreparable financial harm would occur if the application for a stay was denied. The evidence did not show that HSPP was likely to go out of business or  suffer permanent market loss or irreparable damage to its business reputation if HSPP was unable to supplement the boiler’s primary fuel with coal during the months prior to the Board’s decision on the appeal. The Board found that the parties’ evidence was conflicting regarding whether there was a potential for environmental harm if a stay was either denied, or granted. However, the Board also found that there was no evidence that an increase in HSPP’s emissions to either the atmosphere or HSPP’s landfill as a result of the inability to burn coal would cause irreparable harm to HSPP.

Turning to the third element of the test, the Board accepted, without the benefit of an assessment of the merits of the permit amendments, that the Director’s amendments were prima facie in the public interest. The Board determined that, if a stay was denied, the potential costs to HSPP did not outweigh the public interest in the continued application of the amendments for the potential protection of the environment and public health. Therefore, the balance of convenience favoured denying a stay.

Accordingly, the application was denied.