Canada: "Scoping To Triggers" Approach Rejected By The Supreme Court Of Canada

On January 21, 2010, the "scoping to triggers" approach employed by federal responsible authorities (RAs) under the Canadian Environmental Assessment Act (CEAA) was decisively rejected by the Supreme Court of Canada. In MiningWatch Canada v. Canada (Fisheries and Oceans), 2010 SCC 2 (MiningWatch) the Court held that the Environmental Assessment (EA) tracking decision is determined according to the project as proposed by the proponent and not the project as scoped by the federal RA. This eliminates the previous discretion of RAs to define the scope of a project prior to the EA tracking decision.

Background

The CEAA sets out five potential tracks for federal EA depending on the nature of a project: (i) no assessment; (ii) screening; (iii) comprehensive study; (iv) mediation; and (v) review panel. In the past, it had been the practice of RAs to determine the scope of the project first and then determine the appropriate EA track for the project as scoped. Some RAs exercised a "scoping to triggers" approach, whereby the scope of the project was limited to components of the proposal directly related to the powers, duties or functions that triggered the EA under s.5 of the CEAA. In many cases, "scoping to triggers" prior to the EA tracking decision would avoid a comprehensive study. Projects which undergo a comprehensive study are subjected to more intensive assessment, Ministerial oversight and mandatory public consultation, whereas a screening level EA is less rigorous.

In MiningWatch, the central issue before the Supreme Court of Canada was whether the EA track is determined by the project as proposed by a proponent or by the discretionary scoping decision of the federal RA. Previously, the Federal Court ruled that if the project as proposed by a proponent is listed in the Comprehensive Study List Regulations, the EA must be carried out by means of a comprehensive study. The Court held that the RA cannot subsequently rescope the project to downgrade the EA review track from a comprehensive study EA to a screening EA (2007 FC 955; see the November 9, 2007 Osler Update, " Federal Court Disallows Scoping to Triggers"). This decision was subsequently overturned by the Federal Court of Appeal, which confirmed the RA's discretion to define the scope of a project for the purposes of EA tracking. (2008 FCA 209; see the June 17, 2008 Osler Update, " Federal Court of Appeal Confirms "Scoping to Triggers" Approach").

In its decision the Supreme Court of Canada allowed the appeal and held that the CEAA and its regulations require that the EA track be determined according to the project as proposed and that generally, the RA does not have the discretion to change the EA track. In other words, if a proposed project is listed in the Comprehensive Study List Regulations, it is not within the discretion of the RA to conduct a lower level EA screening. The RA or Minister, however, may have the discretion to enlarge the scope in the appropriate circumstances according to the Court. This discretion to enlarge the scope pursuant to s.15(2) or (3) of the CEAA acts as the exception to the general proposition that the level of assessment is determined solely based on the project as proposed by the proponent. It is curious that discretion pursuant to s.15 of the CEAA is only exercisable one way (to enlarge) which is not consistent with how "discretion" is generally understood.

The Supreme Court of Canada allowed the application for judicial review and issued a declaration that the RAs erred in failing to use the project as proposed by the proponent to determine whether it was to proceed by way of a comprehensive study. The Court declined to grant the broader relief that was awarded by the Federal Court trial judge (i.e., to set aside the RA's decision to proceed by way of screening and prohibit the issuing of permits and approvals until the completion of a comprehensive study). The Court noted that the judicial review application had been brought forward as a test case and saw no justification in requiring the proponent to repeat the EA process when there was no challenge to the substantive decisions made by the RAs. Therefore, the EA process and associated permits and approvals were allowed to stand.

Analysis

The position adopted by the Supreme Court of Canada imposes a significant limitation on the RA's discretion to determine the scope of a project for the purposes of an EA under s.15 of the CEAA. Now the primary driver behind an RA's EA tracking decision will strictly be the project as proposed, with limited discretion to scope a project. This will likely result in proponents changing the manner in which they present their project proposals to RAs instead of relying on RAs to "scope to triggers." Practically speaking, this means that proponents will still conduct detailed EAs for their activities, but may only provide RAs with information on projects that come under their jurisdiction. Ironically, this may cause environmental groups to shift the focus of their litigation from project scoping to project-splitting.

The rejection of the "scoping to triggers" approach may extend the reach of federal EA into areas of provincial jurisdiction and subject activities to EA by both provincial and federal authorities. In MiningWatch, the Court was of the view that the problem of inefficient, costly and duplicative federal and provincial environmental assessments could be minimized by existing coordination mechanisms in the CEAA. However, experience has shown that this is not the case. The position taken by the Court also ignores the Constitutional division of powers issue which may lead to jurisdictional battles between federal and provincial authorities.

MiningWatch may also cause federal regulators to reconsider past EA tracking decisions to avoid judicial review by environmental groups. In MiningWatch, the Court did not believe it was necessary for the proponent to substantially re-do the EA as the Federal Court trial judge would have required. The Court recognized the proponent had done nothing wrong, had cooperated fully with the provincial EA process, and that there was no evidence of dissatisfaction with the environmental assessments themselves. This indicates that although screening level EAs may be subsequently bumped up to a comprehensive study EA (and potentially review panel EA), a proponent could argue that the comprehensive study requirements have already been satisfied by another process.

Implications for Proponents

Project proponents now need to strategically consider how they submit project proposals to regulators on a go-forward basis. Proponents may attempt to limit the scope of proposals to the powers, duties or functions of each regulator. While it may be appropriate to hive off approvals for projects ancillary to major projects, proponents will need to be cautious of project-splitting. In addition to this, proponents need to be aware of the prospect of increased duplication in the federal and provincial EA processes, as well as the potential Constitutional and jurisdictional issues that may be more likely to arise as a result of this decision.

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