INTRODUCTION
On July 17th 2013, the Environmental Appeal Board ("EAB") released its decision in Burquitlam Building Limited and Morguard Real Estate Investment Trust – and – Director, Environmental Management Act, Decision No. 2012-EMA-002(b).
The EAB allowed an appeal from Burquitlam Building Limited and
Morguard Real Estate Investment Trust (collectively
"Morguard") from a February 8, 2012 decision of Peggy
Evans, acting as the Director (the "Director") under the
Environmental Management Act, S.B.C. 2003, c. 53 (the
"Act"), refusing to issue Certificates of Compliance
("CofC") for two contaminated sites located in Coquitlam,
British Columbia. Canada Safeway Ltd. ("Safeway")
participated in the appeal as a third party, as it owns one of the
sites and was opposed to the issuance of the CofCs for the Morguard
sites.
This decision has some important implications for applicants for a
CofC for a contaminated site. In particular, the EAB's decision
in Morguard confirms that the Ministry of Environment's
discretion to issue or refuse a CofC is not unfettered, and that
there is no legal support for the commonly-held view that a CofC
will not be granted where there is some evidence that not all of
the contamination has been located.
BACKGROUND
Morguard owns property at 566A Clarke Road in Coquitlam, British
Columbia (the "Morguard Site"). Safeway owned the
adjacent property at 580 Clarke Road, Coquitlam, British
Columbia. The Morguard Site was found to be contaminated with
perchloroethylene ("PCE"), which was historically used as
a dry-cleaning solvent. A portion of the neighbouring Safeway
property (the "Management Area") was also found to be
contaminated with PCE. Morguard took steps to remediate the
contamination to numerical standards, and applied for CofCs for the
Morguard Site and the Management Area. The Director issued
draft CofCs in July 2011, but before they were finalized, Safeway,
in the course of carrying out a detailed site investigation
("DSI") on its property, discovered three exceedances of
PCE in deep groundwater beyond the Management Area. Safeway
submitted this information to the Director and took the position
that Morguard had failed to fully delineate the contamination plume
and that contamination likely still remained at the Morguard Site
and Management Area. Safeway urged the Director not to issue the
CofCs.
In February 2012, the Director rejected Morguard's CofC
application and required that it be re-submitted. The Director
stated that one of the bases for refusing the CofCs was that
Morguard had failed to complete a proper DSI and submit a DSI
report. The Director also found, based on the information
submitted by Safeway, that Morguard had failed to establish that
the contamination had been fully remediated and had failed to fully
delineate the contamination plume.
Morguard appealed the Director's decision to the EAB and
sought orders compelling the Director to issue the CofCs.
THE DECISION
The EAB allowed Morguard's appeal, in effect substituting
its own judgment for that of the Director. The EAB held that
Morguard had reasonably delineated the contamination at the
Morguard Site and the Management Area in accordance with the
standards that were in place when the application for the CofC was
made.
With respect to the first basis of refusal stated by the Director,
the EAB found that absent a remediation order by the Director, the
Act does not impose any legal requirement on an applicant for a
CofC to complete a DSI or submit a DSI report to the Director as
part of the application. Even if that were not the case, the
EAB found that, in substance, Morguard had completed a DSI and had
supplied a DSI report to the Director, albeit one consisting of
several documents. The EAB concluded that substance was more
important than form in the context of evaluating a CofC
application.
With respect to the second basis of refusal stated by the
Director, the EAB concluded that the discovery of some contaminants
outside the delineated Management Area was not, in and of itself,
sufficient to impugn Morguard's delineation or remediation of
the contamination. The EAB preferred the opinions of
Morguard's consultants over those of Safeway in finding that
Morguard had met the appropriate investigative and remedial
standards. The EAB was careful to note that the Director was
certainly entitled to consider the evidence of the exceedances in
evaluating Morguard's application. However, it also agreed with
Morguard's consultant that the applicable investigative
standard was not one of 'perfection'. In reviewing the
totality of the evidence, the EAB concluded that the exceedances
were not evidence of ongoing contamination at the Morguard Site and
the Management Area, nor were they evidence that the delineation
was deficient or that there was a continuing migration risk.
The EAB concluded that all the legal requirements for issuance of
the CofCs had been met by Morguard and ordered the Director to
issue the CofCs.
IMPLICATIONS
This decision is important in a number of respects:
- First, the EAB confirmed that the Director is not entitled to insist on a standard of 'perfection' with respect to CofC applications.
- Second, the Director does not have an unfettered discretion to refuse to issue CofCs, but must act within the scope of the powers conferred by the Act.
- Third, the fact that contamination exists on a neighbouring property is not, in and of itself, sufficient grounds to refuse a CofC provided all the legal and technical requirements which apply at the time the application is made are met. The EAB in effect found that the commonly-held view that the presence of contamination on a neighbouring property would almost automatically result in the refusal of a CofC is, in fact, not an approach which is supported in law.
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