15 March 2017

Logging Companies Fined $2.2 Million Under The Fisheries Act

Siskinds LLP


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On January 9, 2016 following convictions under the Fisheries Act in 2015, three companies were fined $2.2 million in a B.C. Provincial Court, for offences dating back to October 2010.
Canada Environment
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On January 9, 2016 following convictions under the Fisheries Act in 2015, three companies were fined  $2.2 million in a B.C. Provincial Court, for offences dating back to October 2010. The fines were imposed under the former Fisheries Act provisions for the "harmful alteration, destruction and alteration of habitat". This section was repealed and amended by the Federal government in 2012. The 2012 changes focused the Act's aim on protection of the recreational, commercial and aboriginal fisheries from "serious harm", rather than a broader environmental protection law relating to fish and their habitat that existed prior to the amendments.

While the amended legislation was not in force at the time of the charges, it is likely that, in the absence of a due diligence defence, a conviction could have been secured under current legislation as well, given the level of harm done to the fisheries.

The charges and guilty convictions were for the "harmful alteration, destruction or disruption of fish habitat: to wit riparian vegetation, wetlands, three tributaries which flow into the Kumdis Bay Estuary, three tributaries which flow into Mallard Creek and Mallard Creek itself all in violation of Section 35(1) of the Fisheries Act" resulting in an offence contrary to Section 40(1) of the Fisheries Act (the Act).

The three corporate defendants were involved in logging operations: Gwaii Wood Products ("Gwaii") owned the lands that were logged; Howe Sound Forest Products Ltd., ("Howe") purchased harvested logs from Gwaii; and I. Crosby Contracting Ltd. ("Crosby"), which was contracted by Howe to construct road and stream crossings and harvest the logs.

All the contracts included provisions requiring compliance with all applicable legislation.

Following a citizen complaint about the logging activities, an investigation occurred. One fisheries biologist testified at trial:

The area would have been a phenomenal area prior to logging. It ... breaks my heart. I have never seen anything like this before ... I have not seen such an intense suprient imposition of all the streams, wetland features in such a small area, with an estuary on it for the fish to move back and forth.

Another fisheries biologist at trial concluded:

Unfortunately, the majority of the harmful alterations ... to fish habitat will take centuries to fully restore. After restoration, the eight impacted streams are likely to still function as fish habitat providing rearing territory for juvenile Coho salmon and Dolly Varden char. The residual impacts, however, will undoubtedly reduce the productive capacity of the streams and wetland resulting in the reduction in adult Coho salmon production...

Other than Gwaii, the other two defendants were largely or entirely absent during trial and at the sentencing proceedings. One of the companies, Howe, dissolved on December 23, 2013.

Gwaii did not lead a due diligence case in its defence, and instead sought to absolve itself of liability on the basis that it had contractually required Howe to meet all applicable laws in its logging operations. However, the court concluded at paragraph 131 of the trial decision:

[A] company accused of a strict liability offence cannot avail itself of a defence of due diligence by 'contracting out' of its legal responsibilities.....  The landowner retains a legal responsibility to supervise the conduct of the contractor.  If the landowner ignores or is wilfully blind to activities on its land which constitute the actus reus of regulatory offences it is precluded from relying on the defence of due diligence. [emphasis added]

By the time of the sentencing trial, the court noted the severity of the damage and the failure of the defendants to do anything to rehabilitate the damage:

None of the Defendants have taken any steps to attempt any sort of rehabilitation or reclamation of the area ... The damage done ... indicates a wanton disregard for the fish bearing habitat ....  The harm done affected all aspects of the habitat over an extensive area and was done purposely over time.

In addition to the large fines imposed of $580,000 on Crosby, of which $400,000 was directed to conservation and protection of fish or fish habitat on Haida Gwaii; and the fines of $1.1 million imposed on Howe, of which $800,000 was directed towards conservation and protection of fish or fish habitat on Haida Gwaii, the Court also prohibited Crosby from engaging in log harvesting and sales for six months, beginning March 1, 2017 and similarly prohibited Howe Sound, for 5 years, beginning March 1, 2017.

Gwaii was fined a total of $520,000, with $400,000 directed towards environmental protection measures. However, the court also authorized that the latter fine could be satisfied by a transfer of title of the property to a non-governmental conservancy organization as agreed to by the Crown, and, failing such agreement, by further order of the court.

With the cuts and closures to enforcement offices during the tenure of the prior federal government, it's unclear how much enforcement activity is possible under the Fisheries Act. The current government has committed to a review of the changes made to federal environmental legislation under the previous government, including the Fisheries Act. The Standing Committee on Fisheries and Oceans and the Standing Committee on Transport, Infrastructure and Communities was tasked with examining the recent changes to the Fisheries Act and the Navigation and Protection Act. A report is expected in early 2017 but has not been released to date.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

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