Decision Date: July 14, 2009

Panel: David Searle

Keywords:  Environmental Management Act – ss. 40, 41; Contaminated Sites Regulation – ss. 6, 7(1); contaminated site; groundwater contamination; detailed site investigation; preliminary site investigation; subdivision

CNT Holdings Inc. (the “Appellant”) appealed a decision of the Director, Environmental Management Act, Ministry of Environment, directing the Appellant to conduct a detailed site investigation of two lots it owns near Williams Lake, BC.

The lots consisted mainly of undeveloped land which was zoned for rural use.  A small portion of one lot was occupied by a market and was zoned for rural and commercial use.  Neither were zoned for residential use.  For many years previous, starting in the mid-1950’s, the market had been operated as a convenience store and gas bar.  In 1989, the Ministry issued a pollution abatement order to a previous owner of the gas bar, to address groundwater contamination originating from the gas bar.  In 1990, the gas bar was decommissioned and two underground storage tanks were removed.  Contaminated soil under the gas pumps was removed to a depth of seven metres, but removal beyond that was considered impractical.  Groundwater remediation was also considered impractical.  New groundwater wells were constructed on adjacent properties that had been contaminated by pollutants which migrated from the gas bar.

In 2004, the Appellant purchased the lots.  The Appellant was aware of the previous environmental concerns.  In 2007, the Appellant applied for rezoning and subdivision of the lots.  The Appellant sought to subdivide the two lots into six lots, five of which would be developed for residential use and would, therefore, require rezoning.  The market would remain on the sixth lot.  The Appellant’s rezoning application was referred to the Ministry in October 2007, and the Ministry provided no comments.  As part of the subdivision application process, the Appellant prepared a site profile which was forwarded to the Ministry, as required by the Environmental Management Act and the Contaminated Sites Regulation.  In March 2008, the Director issued his decision requiring a detailed site profile for both lots.  This requirement suspended any approval of the Appellant’s subdivision application.

The Appellant appealed the Director’s decision on the basis that requiring a detailed site profile was unfair and unreasonable.  The Appellant argued that the Ministry should have advised it early in the rezoning process if the Ministry had concerns about the property.  The Appellant submitted that it would not have proceeded with the rezoning and subdivision, and incurred further costs, if it had known that a detailed site investigation would be required, because the cost of preparing a detailed site investigation will make the subdivision non-economical.  The Appellant also submitted that, as part of the rezoning application, it completed a geotechnical investigation on all six proposed lots to determine their suitability for sewage disposal systems, and no indication of contamination was found.

The Board found that the Director has authority under the Environmental Management Act and the Contaminated Sites Regulation to require a detailed site investigation, and that he properly exercised his discretion by requiring a detailed site profile in this case.  Specifically, the Board held that the evidence showed that the contamination caused by the former gas bar was not fully remediated by the previous owner.  Although the Ministry’s Contaminated Site Registry listed the site’s status as “inactive – no further action”, the Registry also indicated that the site had not gone through the entire remediation process and the Ministry could require further assessment or remediation in the future, despite the fact that it required no further action in 2000 when the notation was made.  The Board also found that the geotechnical investigation of the lots’ suitability for sewage disposal systems was not deep enough to be conclusive regarding the historic contamination.  Further, the Board found that it was reasonable for the Ministry not to comment on the rezoning application, because there is no legal requirement for the Ministry to do so.  The statutory requirement to submit a site profile to the Director, and for the Director to decide whether further information is needed, applies to subdivision applications.  Furthermore, the Board noted that the legislation makes the Appellant, as the owner of the site, responsible for conducting the detailed site investigation, regardless of the fact that the contamination was originally caused by someone else.

In these circumstances, the Board agreed with the Director that a detailed site investigation is warranted.  However, the Board found that the Director’s decision was too broad, because the evidence of groundwater flows indicates that the area of concern is limited to the former gas bar site, which is proposed lot 1, and does not include lots 2 to 6.

In conclusion, the Board found that the matter should be remitted back to the Director with directions to limit the detailed site investigation to lot 1 of the proposed subdivision, and that he consider whether an investigation of adjacent lands should be conducted.

Accordingly, the appeal was allowed, in part.