When it comes to the remediation of contaminated land, the "polluter pays" principle is well established in Canadian legislation and case law. But who pays when the "polluter" has died?
In British Columbia, the Environmental Management Act and Contaminated Sites Regulation (collectively, the "EMA") govern the identification and remediation of contaminated sites. The EMA imposes certain obligations on the executor of an estate (among other specified parties) if real property in the estate has been used for a "specified industrial or commercial use", including manufacturing, equipment maintenance and repair, road salt storage, outdoor shooting ranges, snow removal dumping, automotive repair, or dry-cleaning.
The obligations of the executor set out in the EMA include:
- providing a site disclosure statement when a triggering event occurs (e.g., sale of the property);
- arranging for investigation of the property to determine if it is contaminated; and
- arranging for remediation of the property, if required.
If it is determined that the property has been contaminated, the property will need to be remediated. The executor will not be held personally liable for remediating the property unless the executor was grossly negligent or guilty of wilful misconduct in taking certain actions that caused the contamination. However, the executor is responsible for the cost of remediating the property to the extent of the estate's assets. Other responsible parties identified in the EMA include any current operator of the property (for example, a tenant) and any former owner of the property. All responsible parties identified in the EMA are jointly and separately liable for the cost of remediation.
The executor's responsibility for remediation ends only if the executor:
- gives notice that the estate is insufficient to pay for remediation;
- pays for remediation;
- disposes of the contaminated property to a person who agrees, in writing, to accept responsibility, or who enters into a voluntary remediation agreement;
- disposes of the property where a site disclosure statement was provided or not required, where there is no record of contamination, and where the executor had no knowledge of contamination;or
- is removed or discharged from the office of executor by the court, or the court orders that the executor is not responsible.
It is crucial that possible issues of environmental contamination be canvassed during the estate planning process, as the potential application of the EMA to a will-maker's estate may impact various aspects of the estate plan. For example, if a will-maker owns real property – either directly or indirectly – that has been used for a "specified industrial or commercial use", the will-maker will want to name an executor who is well-suited and willing to navigate any obligations that arise under the EMA. Practitioners advising on the administration of an estate should also canvas a deceased person's real property interests in detail to identify any obligations of the executor under the EMA, and to assess the estate's exposure to liability.
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.
