Decision Date: May 9, 2013

Panel: Alan Andison

Keywords: Environmental Management Act – ss. 1 – definition of “remediation”, 48(2), 56, 99, 101(1); appealable decision; person aggrieved; remediation plan; contaminated site; exercise of discretion

Seaspan ULC (“Seaspan”) appealed a decision issued by the Director, Environmental Management Act, Ministry of Environment (the “Ministry”), which pertains to a contaminated site located in North Vancouver. Domtar previously owned part of the contaminated site, and Seaspan currently owns part of the site. Seaspan leases other parts of the site from the Vancouver Fraser Port Authority. One part of the site is occupied by Fibreco Export Inc.

In 1995, the Ministry was informed of the contamination at the site. The contamination consists of creosote, creosote-derived substances, metal, and organometal substances, resulting from Domtar’s historical wood-preserving activities and Seaspan’s shipyard activities at the site. The Director described the site as being “the source of serious contamination and significant environmental protection concerns.”

In 1997, Seaspan informed the Ministry that it would work with Domtar to address the contamination. Since that time, the site has been the subject of various investigations and reports, but Seaspan and Domtar were unable to agree on a remediation plan.

In April 2010, the Director issued a remediation order that requires Domtar and Seaspan to finalize a site remediation plan for the Director’s review, implement a site remediation plan subject to any conditions imposed by the Director, and remediate the site to certain standards. However, Seaspan and Domtar remained unable to agree on a remediation plan. In particular, they disagreed on the appropriate design for a barrier wall, a key component of the remediation. In November 2011, they submitted separate remediation plans for the Director’s consideration.

In January 2013, the Director decided that both of the site remediation plans were acceptable, and the Director left it to Seaspan and Domtar to decide which of the plans they would implement. The Director also advised that the requirement in the remediation order to implement a site remediation was in effect immediately.

Seaspan and Domtar filed separate appeals of the Director’s decision.

In a preliminary decision dated March 6, 2013, the Board granted an application by Seaspan to have its appeal heard separately from the other appeals related to the site, and the Board committed to conducting Seaspan’s appeal on an expedited basis (Seaspan ULC v. Director, Environmental Management Act, Decision No. 2013-EMA-002(a)). In another preliminary decision, dated April 24, 2013, the Board granted Seaspan’s application for a stay of the requirement to implement a remediation plan, pending the Board’s decision on the merits of Seaspan’s appeal (Decision No. 2013-EMA-002(b)).

In the hearing of the merits of Seaspan’s appeal, Seaspan submitted that the Director committed errors of law and jurisdiction by accepting both remediation plans, yet requiring one plan to be implemented. In particular, Seaspan submitted that the Director’s decision was: contradictory to section 48(2) of the Act because it failed to stipulate the remediation to be undertaken; internally contradictory; and, unreasonable. Seaspan requested that the Board reverse the Director’s decision, and send the matter back to the Director with directions to determine which of the two remediation plans should be implemented.

The Director challenged the Board’s jurisdiction to hear the appeal, on the basis that Seaspan was not a “person aggrieved” within the meaning of section 101(1) of the Environmental Management Act (the “Act”), and that his decision was not an appealable “decision” under section 99 of the Act.

In addition, the Director, Domtar, and Fibreco Export Inc. all submitted that the Director’s decision should be confirmed.

The Vancouver Fraser Port Authority provided no submissions, and the Attorney General of BC took no position on the appeal.

First, the Board considered the issues of whether Seaspan had standing to appeal as a “person aggrieved,” and whether the Director’s decision was an appealable “decision.” The Board found that the Director’s decision placed Seaspan in a position of having to negotiate an agreement with Domtar over which plan to implement, despite their failure over several years to reach such an agreement. Seaspan operates on the site, and believes that only its plan is consistent with its interests and is best for remediating the site. In these circumstances, the Board held that Seaspan is a “person aggrieved” within the meaning of section 101(1) of the Act, because it has a genuine grievance as a result of an order that prejudicially affects its interests. In addition, the Board found that the Director’s decision is an appealable “decision,” because it flowed from the 2010 remediation order, which specified that Seaspan and Domtar would be required to implement a remediation plan “subject to any conditions imposed by the Director.” The Director’s 2013 decision required them to implement a remediation plan. That requirement or condition was imposed as part of the remediation order, even though it was imposed three years later. Thus, the appealed decision amounted to “including a requirement or condition in an order” under subsection 99(e) of the Act.

Next, the Board considered whether the Director’s decision to approve both plans, instead of one, was contrary to section 48 of the Act. The Board found that the Director’s decision was contemplated by, and occurred as a result of steps in the context of, the 2010 remediation order. Section 48 relates to remediation orders, and in this case, the remediation order specifies the remediation to be undertaken pursuant to section 48(2)(b) of the Act. The action to be taken under the remediation order is sufficiently specific to be enforceable under the Act. Although the remediation order appears to contemplate the submission of a single remediation plan, nothing in the Act prohibits the Director from changing the terms of the remediation order, or requires the Director to choose only one remediation plan. Specifically, neither section 48 of the Act nor the Act’s definition of “remediation” indicate that only a single plan may be found to be acceptable for the purposes of remediating a site. Thus, the Director’s decision was not contrary to section 48. Further, the Director’s approval of two plans does not conflict with the section 56 of the Act, which requires persons conducting remediation to give preference to remediation options that provide permanent solutions.

The Board also considered whether the Director’s decision was unreasonable “on its face,” insofar as it required the parties to implement a remediation plan but did not select one plan to implement, or by being incapable of implementation without an agreement by the parties, or by attempting to compel the parties to reach an agreement. The Board found that the failure by Seaspan and Domtar to decide which of the two approved remediation plans they should implement does not make the Director’s decision unreasonable or incapable of implementation, on its face. Even if the Director had approved only one plan, it is apparent that there would have been an appeal, no matter which plan was approved. Further, under the independent remediation provisions in section 54 of the Act, either party has the option of implementing its own remediation plan. In other situations involving a contaminated site with multiple persons responsible for remediation, it is not unusual for one responsible person to take the lead in remediating the site, and then seek cost recovery from the other responsible persons later. That has not happened in this case, but it is not the Director’s role to act as a “referee” in the disagreement between Seaspan and Domtar. If the parties required more time to reach an agreement, they could have requested an extension of time from the Director, rather than asserting that the Director’s decision is unreasonable. Moreover, the parties have had many years to negotiate, and if they fail to make reasonable efforts to comply with the Director’s decision, then enforcement action under the Act would be appropriate, especially given that the site contains serious contamination.

Accordingly, the appeal was dismissed.