City of Kawartha Lakes taxpayers continue to
pay heavily for the Ministry of the Environment's 2009 order,
which required the City to cleanup an oil spill that it did not
cause. While everyone agreed that the City was an innocent
victim of the spill, the Ministry saddled the City with $471,691 in
cleanup costs, arguing that the City could seek reimbursement
through the courts or a cost recovery order. The Environmental Review
Tribunal and the Court of Appeal upheld the Ministry's order
against the City.
The City has been trying to recover its cleanup costs, and its
growing legal bills, ever since. It sued numerous
parties in the civil courts, and issued a spill cost recovery
order under s. 100.1 of the Environmental Protection
Act to the Gendrons (the homeowners whose oil was spilled),
Thompson Fuels Ltd. (their fuel supplier) and the Technical Standards
and Safety Authority.
All three appealed to the Environmental Review Tribunal in 2010, but the
appeal has never been heard. Over the City's strenuous
objections, the Tribunal has adjourned the appeal four times (most
recently in January 2015), because the City is also
pursuing civil litigation to recover the same costs. According
to the Tribunal, a global resolution of the total dispute is more
likely to be achieved in the civil courts and it would be wasteful
to also hold a Tribunal hearing on the s.100.1 Order.
Unfortunately for the City, now that its spill cost recovery
actions have been consolidated with Mr. Gendron's civil action
against Thompson Fuels, the Tribunal cannot foresee a scenario
(absent the Superior Court adjourning the civil actions) where it
would be more efficient for the Parties to proceed before the
According to the Tribunal, if the complex civil proceedings are
dragging on longer than expected, the City has no one but itself to
blame. Even now that the City has settled with Thompson Fuels and
the TSSA, the Tribunal still refuses to hear the appeal of the cost
recovery order. In TSSA v Kawartha Lakes, ERT
cases 10-055, 10-058, 10-059, 10-060, January
2005, they ruled:
 The Tribunal points out that the presence of a related
civil action is not, on its own, determinative of an adjournment
motion such as this. The parties are owed a legal determination of
the question of whether the City will be reimbursed for clean-up
expenses. However, in cases such as this where the City itself is a
plaintiff in an ongoing parallel civil action, the potential for
duplication is real. .... In a circumstance like this, where the
City chose to initiate and actively prosecute a civil action over
the same clean-up costs, it is clear that the City itself created
the situation that led the Tribunal to adjourn its proceedings to
The Tribunal's advice for other municipalities concerned
about such delays when seeking compensation for spills you are
forced to cleanup? Issue your s. 100.1 order quickly, and try to
push to complete the appeal of that order within two years, i.e.
before the limitations period expires for launching a civil action
for the same costs.
The City has settled its 100.1 case with the TSSA and Thompson
Fuels, and has also settled parts of the civil case for an
undisclosed amount. While the original MOE order was clearly
unfair, prolonged litigation costs so much that it is not obvious
whether all this litigation has left Kawartha Lakes
taxpayers better off.
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