Canada: Ontario Court Dismisses "Speculative" Challenge To A Prospective Wind Turbine Project

In Wiggins v. WPD Canada Corporation,1 the Ontario Superior Court of Justice dismissed the plaintiffs' claims for injunctive relief and $16.6 million in damages against a prospective (not yet approved) wind turbine project, granting the defendants' motions for summary judgment.

The Court found that the plaintiffs were unable to show that they had a viable cause of action in nuisance, negligence, trespass and strict liability until the project received its final Renewable Energy Approval (REA), if ever. The Court also said that it would be inappropriate – and also impossible – to decide the claims advanced by the plaintiffs on a proposed project that could be subject to amendments in its design plan under  the regulatory REA process, which had not yet been completed.

Although the plaintiffs led evidence demonstrating that nearby residents had already suffered a diminution in property values and interference with the use and enjoyment of their properties, the Court found that the plaintiffs had failed to show that the diminution was caused by the defendants. Further, the Court concluded that the plaintiffs' evidence relating to anticipated adverse health effects once the turbines commenced operation was too speculative to merit injunctive relief or a full trial before an REA was issued.

However, the Court explicitly held that the dismissal was made "without prejudice" to the plaintiffs' ability to commence a similar or identical action once the project was approved.

This decision suggests that it is inappropriate to bring a claim for damages or injunctive relief against a proposed green energy project while the project winds its way through the regulatory approvals process.

Background

The plaintiffs, two groups of landowners in Clearview Township (near Barrie, Ontario), brought identical claims against the defendants seeking the following:

  • injunctive relief to restrain the construction of an industrial wind turbine project situated entirely on one of the defendant's farmlands (the Fairview Wind Project); and
  • $16.6 million in damages for nuisance, negligence, trespass and strict liability.

However, when the actions were commenced, the Fairview Wind Project was not yet under construction. No REA had been granted because the REA process was only in its inception. The proponents of the Fairview Wind Project commenced the REA process under O. Reg. 359/09, which requires mandatory public consultation at the outset, including notifying nearby landowners, placing notices in local newspapers and holding community consultation meetings. The defendants first announced the plan for the Fairview Wind Project in June 2010 and posted a public notice, which included a Notice of Draft Site Plan, in June 2011. The defendants filed the completed REA application for the Fairview Wind Project in August 2012. The Fairview Wind Project has not progressed further, and the MOE is currently in the process of assessing the REA application for completeness.

In their actions, the plaintiffs alleged that the June 2011 notice caused a decline in nearby property values and that formally publishing information about the project without further study or research caused harm to the plaintiffs.

The defendants brought summary judgment motions seeking dismissal of the actions on the basis that, given the early stage of the project, both the scope of the project and whether or not the project would be constructed were uncertain, and therefore the claims were speculative, premature and incapable of proof.

The Summary Judgment Motions

The Plaintiffs' Evidence

For the purposes of the summary judgment motions, the plaintiffs filed the following evidence:

  • expert appraisal evidence that their properties were "likely" devalued by between 22% and 50% on the basis of the project proposal as presented;
  • expert medical evidence demonstrating that the project, as planned, would cause adverse health effects and impacts on physical and environmental quality of life;2 and
  • expert technical evidence from an acoustician who opined that there is a "strong possibility" that the project, as planned, would not be capable of complying with regulatory wind turbine noise thresholds.

The defendants did not challenge the plaintiffs' evidence for the purposes of the motions and invited the Court to take the evidence as proven in order to place the plaintiffs in the most favourable position. Consequently, the Court adopted the plaintiffs' unchallenged evidence for the purposes of the summary judgment motions.

Despite the plaintiffs' property valuation evidence, the Court concluded that the plaintiffs were unable to present any evidence linking the diminution in property values to the defendants. Furthermore, given that the project was still in an early stage of development, the Court found that the plaintiffs failed to prove, on a balance of probabilities, that the defendants have subjected or will subject them to any of the harms alleged.

Nuisance, Negligence, Trespass and Strict Liability

The Court dismissed each of the plaintiffs' claims in nuisance, negligence, trespass3 and strict liability on the basis that they are speculative and incapable, at this stage, of proof. The claims were found to be clearly prospective because the project has not yet been built.

With regard to nuisance, the plaintiffs alleged that the Fairview Wind Project would cause the plaintiffs to suffer financial and other harm, including a loss of use and/or enjoyment of their property. Given the early stage of the project, the Court found that there was no evidence whatsoever of any nuisance, apart from the alleged impact on property values. The potential impacts of the project were merely speculative until the final form and specifications of the project crystallized after a full REA process. In such circumstances, "where the anticipated or expected harms are subject to change," the Court held that "it is impossible to measure the potential environmental impacts [of the project] with any certainty." The analysis becomes "academic" at best and cannot ground a claim.

With regard to the diminution in property values, the Court found that the mere fact of depreciation cannot, alone, ground an action in nuisance; there must be evidence of substantial, physical harm, which, in this case, has not yet materialized because the project has not yet been built. Similarly, the Court, citing the Court of Appeal's landmark decision in Smith v. Inco Limited,4 commented that it would be undesirable to award damages relating to diminution of property value based solely on the public's concerns, rather than actual harm.

With regard to negligence, the plaintiffs alleged that the defendants had breached their duty to care owed to the plaintiffs by failing to carry out necessary studies and warn community members of the prospective risks of the project. More specifically, the plaintiffs alleged that the June 2011 public announcement of the project breached the duty of care owed to the plaintiffs.

Although the Court found the negligence claims to be too speculative, the Court made two interesting findings: (1) it was not unreasonable to impose a duty of care upon a project's proponents with respect to nearby landowners; and (2) it was foreseeable that the plaintiffs could incur financial losses relating to public perception about the undesirability of land near a wind farm. While the plaintiffs succeeded in establishing a duty of care, they could not otherwise demonstrate that the defendants breached the standard of care in performing the various steps of the REA process. That is, although the defendants had a duty of care to warn the plaintiffs about any unreasonable risk of harm created by the project, it would be impossible at trial for the plaintiffs to prove breach of the standard of care because any "risks remain unascertained at this stage of the project."

Similarly, both the trespass and the strict liability claims were dismissed on the basis that no trespass or accidental release of any kind had yet occurred.

Injunctive Relief

The plaintiffs argued for an injunction seeking to stop the project before it started. The test for such an injunction is whether there is a high degree of probability that the alleged harms will in fact occur.5 The Court held that because the project plans could be significantly altered by the REA process, no harm, or even a risk of harm, had yet materialized. In a full trial, a court would merely be speculating as to the future harm, and would therefore not grant injunctive relief  where it would be impossible to determine whether or not the future harm would occur.

Discussion

This ruling suggests that attempts to halt a green energy project at the public consultation stage, prior to any issuance of an REA, are likely to be susceptible to summary judgment motions seeking their dismissal. Moreover, the practical implication of this decision is that a plaintiff's claim is not discoverable when a proposed REA project is publicly announced because at this stage, either the injury, loss or damage has not yet occurred or, in respect of property-value diminution, there is no way of establishing that it has occurred as a result of tortious conduct of a proponent. The Court commented in obiter that, had it not dismissed the damages claim outright in this instance, future claimants might run into limitation period issues, since it is generally accepted that the REA process may take a substantial time to complete after the project is first publicly announced.

This ruling also suggests that an injunction will not  issue in such cases because, until the final form of the project has been approved, it is not possible for a court to say that there is a high degree of probability that the alleged harms will in fact occur.

Despite the success of the defendants on these motions, the plaintiffs have claimed success in proving that REA approvals may cause property value diminution.6 However, the Court accepted the alleged facts as proven only for the purposes of the motions for summary judgment. Wiggins is therefore of limited precedential value in this regard. Moreover, property valuation evidence, as presented by the plaintiff in Wiggins, cannot be considered by the Environmental Review Tribunal on an REA appeal, as the Tribunal is only empowered to consider evidence relating to "serious harm to human health" or "serious and irreversible harm to plant life, animal life or the natural environment."

Therefore, it remains to be seen how property valuation, health and acoustic evidence regarding the actual effect of the operation of wind turbines will be determined at trial. Given that the Court's decision is without prejudice to the plaintiffs' ability to revive these arguments once the project receives the requisite approvals for construction, it appears likely that even where, as here, premature actions against unapproved wind farms are dismissed, they will be recommenced after the REA approval is granted. And when that occurs, plaintiffs will likely try to bolster their evidence of deleterious impacts caused by the operation of wind turbines, based on the project as approved by the MOE.

Footnotes

1     2013 ONSC 2350 (Wiggins).

2    The decision notes that the plaintiffs have significant concerns about the following and other health effects: sleep disturbance, annoyance, headache, tinnitus, ear pressure, dizziness, vertigo, nausea, visual blurring, tachycardia, irritability, problems of concentration and memory, and/or panic episodes.

3    The claim in trespass was grounded in the escape of allegedly damaging noise/sound, vibration and light flicker onto the plaintiffs' properties.

4    (2011), 107 O.R. (3d) 321 (C.A.).

5   Operation Dismantle v. Canada, [1985] 1 S.C.R. 441 at paras. 34-36.

6    Wind turbines have reduced property values, court says, Toronto Star, April 23, 2013. 

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