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Table of Contents
City Owes Duty of Care Despite Owner's Conduct - Contractors Fib
MUNICIPAL WATER AND WASTEWATER
Water Quality - Municipal Testing and Reporting Regulations
Ammonia Recommended As CEPA Toxic May Affect Municipal WWTPs
MANDATORY REPORTING
Municipalities and NPRI Requirements Expanded For 2000
Ontario To Require Air Monitoring/Reporting of 357 Substances - NPRI Not Good Enough Says Newman
COMPLIANCE AND ENFORCEMENT
MOE Issuing More Orders Voluntary Abatement Deals Discouraged
CONTAMINATED AND SURPLUS LAND
Municipal Tax Sales Agreements May Reduce Liability Exposure
PLANNING AND PROTECTION
Municipal Groundwater Protection - Legal Tools
Agriculture Minister Supports Municipal Interim Controls
ENGAGEMENTS OF NOTE
City Owes Duty Of Care Despite Owner’s Conduct - Contractors Fib
A recent Supreme Court of Canada decision held a municipality partially liable to compensate a property owner even though the property owner allowed his contractor to start work without obtaining a building permit. The Supreme Court once again made clear that once a municipality makes a policy decision to conduct building inspections, it owes a duty of care to anyone who suffers injury or damages due to negligent inspection. Following this decision, building inspectors are going to have to be firm and rigorous if they are going to avoid liability.
Although the City's share of liability was small (only 14%), it was held to be jointly and severally liable with the contractor for a full 80% of the damages. This means that if the contractor refuses to pay, or is broke, the City will be responsible for the full amount, and may have to sue the contractor for the balance, or write it off.
The case is called Ingles v. Tutkaluk Construction Ltd. A Toronto homeowner hired a contractor for residential basement renovations. The work required underpinning the foundation of the house to prevent it from cracking or collapsing. The owner knew a permit was required, and included a requirement in the contract. However, the contractor talked him into letting the job start before obtaining the permit. By the time a permit was issued and the building inspector came around, the underpinning work was finished and covered by other construction. The permit stated that the underpinning had to be carried out to the satisfaction of the building inspector and that the inspector be notified before the proceeding with the underpinnings and pouring the concrete. It was raining when the inspector visited, and instead of digging to verify the construction of the underpinning, the inspector took the contractor's word. Another inspector visited two weeks later after more work was done and did not dig either.
Several weeks after the work was completed the owner's basement began to flood regularly. A new contractor discovered that the underpinnings were totally inadequate and did not comply with the Building Code. The owner sued the original contractor and the City of Toronto for damages for the repairs to the house. Ontario's Court of Appeal held that the City was not responsible since the owner proceeded without a permit, knowing it would make the underpinnings difficult to inspect, and could not later turn around and sue the City for failing to inspect.
The trial judge had found the owner to be partially negligent to the extent of 6%. The City's liability was apportioned at 14% with the 80% balance held against the contractor. However, the City and contractor were made jointly and severally liable for the full 94%, with the City granted an indemnity against the contractor for its share. The Supreme Court of Canada upheld the trial judgment. The Court agreed with the trial judge that the inspector had the power to order the owner to bring in an engineer to saw through the underpinning to show its width, or order that construction halt until it stopped raining so that he could dig and inspect. Since the contractor had not complied with the permit requirements at the time of the inspection, it was unreasonable of the inspector to take his word for the adequacy of the construction. Supreme Court Justice Bastarache stated:
"Indeed, it has been recognized by this Court that it is to be expected that contractors, in the normal course of events, will fail to observe certain aspects of the building by-laws. It is for this reason that municipalities employ building inspectors…"
Comment: This case affirms the municipal duty of care in conducting building inspections. Municipalities cannot afford to have their building inspectors be ‘nice guys.’ Building inspectors have to carry out inspections diligently and rigorously despite roadblocks that owners and contractors put in their way. Where necessary, inspectors will have to exercise their statutory powers to halt construction or take other actions to ensure that construction complies with the Building Code.
MUNICIPAL WATER AND WASTEWATER
Water Quality – Municipal Testing and Reporting Regulations
In response to the tainted water crisis in Walkerton, the MOE moved quickly to draft a regulation to govern water testing and result reporting. The regulation will require:
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accreditation of all labs and treatment plants conducting water testing; -
municipalities to inform the MOE if they change the private labs; -
water treatment facilities to renew Certificates of Approval every three years; and
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labs discovering unsafe drinking water to immediately notify the MOE, Medical Officer of Health and the municipal water facility operator.
According to MOE press releases, these measures will merely clarify the existing practices. It is hard to see how this regulation can make much difference if there are too few staff left at the MOE to read the fax or answer the phone.
Is the province's role in water quality only that of standard setter and rule enforcer? The judicial inquiry into the drinking water tragedy will examine the role of the province and the impact of the downloading of water quality issues to municipalities. How far will the inquiry go in looking at the lack of a provincial groundwater protection policy?
Ammonia Recommended As CEPA Toxic May Affect Municipal WWTPs
Environment Canada has recommended that Ammonia be added to the list of toxic substances under the Canadian Environmental Protection Act, 1999 (CEPA). The report identified municipal wastewater treatment plants (WWTP) as a priority. If the recommendation is formalized, Environment Canada will have two years to propose regulations or other strategies to control discharges of ammonia in municipal wastewater.
Sewer Use By-law Update: 1998 Provincial Model Abandoned
In recent conversations with MOE officials we were told that the draft model sewer-use by-law (June will not be finalized. The provisions, including the proposed standards tables, could not be adapted to cover the range of municipal concerns - one size does not fit all. We suspect that establishing uniform discharge limits was one controversial aspect of the Draft that blocked progress on a new model. Currently the MOE is conducting informal stakeholder consultations towards publishing a technical manual to guide municipalities in drafting their own new by-laws. The MOE is going to leave the final decisions on discharge limits up to municipalities. On one hand, this seems consistent with the government's policy on municipal autonomy and local decision-making. On the other, this is arguably another step in the balkanization of environmental protection in Ontario - dismantling the provincial environmental framework..
We reviewed the 1998 draft model. It is poorly worded and likely to be difficult to enforce. We have recently drafted sewer use by-laws for municipal clients that integrate modern principles of environmental protection and are practical, workable and enforceable by the municipality.
Toronto Council Set To Adopt Stringent Sewer By-law
Toronto City Council adopted the controversial new sewer use by-law in early July after an extensive period of consultation and consideration.
The by-law will be posted on the City’s web site in mid-July. It is based on Draft 6, but will incorporate more stringent sanitary and combined sewer discharge limits from Draft 4 for several substances including chromium and copper. There will be a two year phase-in period to allow industries to meet the discharge limits for sanitary, combined and storm sewer discharges. Until the expiry of the two years, the respective limits in the former Metro by-law will apply. For some contaminants the new limits may be phased-in over four years.
Pollution prevention plans will be required by some 4000 to 5000 industrial and commercial facilities. Every industrial facility discharging any of the listed contaminants into a Toronto sewer will have to submit a plan summary to the city, and update the summary every two years. Updates must detail and evaluate the facility's progress in accomplishing the plan's objectives. Plans are not to be submitted, but must be available to city inspectors. The deadlines for plan summary submissions are being phased in according to industry sector, with the first group to be required by June 30, 2001 and all industries due by June 30, 2002.
Toronto's goal is to stop incinerating sewage sludge. Discharge limits are designed to ensure that the sludge will be suitable for constructive uses such as land application.
Toronto's by-law is expected to affect surrounding municipalities who send wastewater to Toronto plants for treatment. Up-to-date information and latest drafts and limits are posted on the Web at www.city.toronto.on.ca/involved/wpc/nbylaw.htm.
Municipalities and NPRI Requirements Expanded For 2000
Under the National Pollutant Release Inventory (NPRI) many municipalities must report annually on their releases and transfers of listed chemical substances. The NPRI is authorized under the Canadian Environmental Protection Act.
The NPRI requires any facility that “manufactures, processes or otherwise uses” one of the listed substances in a quantity that exceeds the reporting threshold, to report to Environment Canada on that substance. The report, in electronic form, must set out the quantities of the substance released, recycled or disposed.
Municipalities may have to report on chemicals including chlorine and ammonia for water or sewage treatment, or in recreational facilities such as swimming pools and arenas. Municipalities incinerating waste or sewage sludge, or using fossil fuels to generate power may also have to report. Changes to the NPRI for the year 2000 introduced a 5 kg. reporting threshold for mercury. Some municipalities may have to investigate whether reportable quantities of mercury exist in annual sewage sludge production.
Some municipalities may carry on activities subject to new NPRI reporting requirements for all dioxin, furan and hexachlorobenzene releases on-site and transfers. These activities include fossil fuel power generation; non-hazardous solid waste incineration of 100 tonnes or more of waste per year, including small combustion units, teepee burners and beehive burners; and sewage sludge incineration.
For a complete list of the 268 NPRI substances for year 2000, NPRI requirements and links to Environment Canada NPRI sites, visit the Willms & Shier NPRI web site at www.willmsshier.com.
The reporting deadline for the 2000 NPRI is June 1, 2001.
Ontario To Require Air Monitoring / Reporting Of 357 Substances - NPRI Not Good Enough Says Newman
Ontario regards the NPRI as fundamentally flawed and intends to impose more extensive mandatory monitoring and reporting regulations on municipalities and industries starting in January 2001.
Ontario's Minster of Environment Dan Newman wrote to federal Environment Minister David Anderson, complaining that the NPRI is fundamentally flawed because it doesn't cover emissions of gasses causing smog and acid rain or greenhouse gases.
MOE's proposed regulations will require municipalities and industries to monitor and report on emissions of some 357 substances, starting January 1, 2001. The new regulation and substance list are to be posted on the Environmental Registry this summer for two months of public consultation.
Every organization required to report (including a municipality), will have to pay a user fee to the MOE when filing the mandatory report. Reporting will be in electronic format and MOE intends to make the data available to the public.
Ontario’s proposal will have more impact on municipalities than the NPRI, since Ontario proposes to monitor smog precursors and greenhouse gas emissions such as methane. Municipal landfill and composting facilities emit significant quantities of methane. Depending on the regulations, municipalities may also have to monitor and report on combustion emissions from public works, waste management and other operations.
Critics see this proposed monitoring program as another political gesture – trumpeting government efforts in making industry do more self-reporting as meaningful environmental protection measures. The government seems to believe that passing more regulations and downloading more responsibility to municipalities and the private sector constitutes meaningful environmental protection. It continues to ignore the decimation of MOE staffing and its erratic enforcement record.
Willms & Shier will post links to the draft regulation, list of substances, thresholds and guidelines when they are publicly available at www.willlmsshier.com
Electricity Sector Emissions Regulated Competition Delayed
On June 22, 2000, Jim Wilson, Minister of Energy, Science and Technology announced a delay in the opening of the energy market.
New regulations requiring power generators to monitor and report on smog and acid rain emissions came into force on May 1, 2000. The government also introduced regulated limits (caps) on emissions of sulphur dioxide and NOx for the year 2001. The MOE intends to lower the level of permitted emissions in the future to contribute to reduced air pollution. These measures were introduced to take effect at the introduction of Ontario's competitive energy market later in 2000. It is not clear whether that will precipitate any changes to the monitoring, reporting or reduction dates.
For more information see the MOE's links page to environmental electricity initiatives: http://www.ene.gov.on.ca/envision/env_reg/er/documents/2000/electricity.htm
MOE Issuing More Orders Voluntary Abatement Deals Discouraged
Will municipalities be subject to more orders and prosecutions? That remains to be seen. The MOE and provincial government have issued so many mixed messages it is difficult to understand where they are going. Bottom line – money talks – and the government has not yet begun invest in MOE staff and resources.
MOE officials have told us on several occasions that the Ministry's new internal policy has shifted from voluntary to mandatory abatement. This means that Ministry staff are supposed to issue more orders, instead of agreeing to voluntary abatement strategies. Provincial officers are said to require written approval from a Director in order forego imposing an order for non-compliance. We have seen more orders issued by the MOE lately. Overworked abatement officers are pushing their 'field order' powers to the limit to try to comply with the new policy shift using limited resources. The Ministry has not managed to train staff to use the new provincial officer order powers that were rushed through the legislature more than a year ago. This policy shift to mandatory abatement was supposed to have been made public through amendments to the MOE's compliance guideline – but the amendments had not been posted on the Environmental Registry by press time.
Notwithstanding the overstress and disfunctionality in some departments, the MOE is keeping up with the workload for industrial approvals. Turnarounds are reasonable, and doctrinaire or unreasonable positions are the exception.
An unexpected product of municipal restructuring is the amount of surplus land that new municipalities no longer require. Some surplus properties, such as former public works yards, may be contaminated. Municipal administrators and politicians should be aware of the potential liability before offering properties for sale. It is prudent to obtain environmental site assessments (ESA)of properties prior to offering them for sale. If there are a number of properties, it may be economical to have them all done at once. Armed with an ESA, the municipality, with its solicitors, will be in a position to negotiate a fair sale agreement that will protect the municipality from future liability.
Municipal Tax Sales Agreements May Reduce Liability Exposure
Municipalities can reduce exposure to contaminated land liability during the tax sale process by entering into a property-specific agreement with the MOE. The municipality, its employees and its agents are protected during the lead-up and sale process. The long-awaited standard form is called Agreement Concerning Environmental Investigations and Tax Sale. It allows municipalities to take actions to abate hazards and protect property value without environmental liability during the 180 days following a public sale or failed public sale. These actions include collecting rents and conducting environmental investigations.
In order to obtain this limited protection the agreement must be signed by a municipal official and an MOE official and specify the property or properties covered. The agreement expires at the end of the 180 day period unless extension is requested from and granted by the MOE. Once the time is up, if the municipality remains vested with the property, the municipality becomes a "responsible person" under Ontario's environmental laws.
Despite the agreement, tax sales of a contaminated site remains risky, and should be done with care.
For legal advice related to sales of surplus municipal lands or tax sales, call John Willms (416-862-4821) or Kirk Walstedt (519-776-9020).
MOE Contaminated Site Guideline Workshops
In May and June the MOE conducted a series of workshops on Ministry policy and practice in dealing with the Guideline For Use At Contaminated Sites In Ontario. The workshops were well attended by municipal staff and environmental consultants.
A number of technical and policy questions remain unresolved. For example, the issue of "inert fill" remains in limbo. MOE published a draft Excess Soil Guideline a few years ago but it was never finalized, and Reg. 347 amendments are still on the drawing board. Setting the cleanliness standard too high for inert fill means higher waste disposal costs on site clean-ups – a disincentive to brownfield site redevelopment. Unreasonable regulations are also an invitation to abusers. There is no excuse for the MOE's failure to resolve this issue after so many years of consideration.
Municipalities are still struggling with ways to apply the Contaminated Sites Guideline to planning approvals in a way that is cost-effective for developers and affordable for municipalities, while protecting the public and limiting municipal liability. Instead of leaving each municipality to develop a local solution, the MOE and Ministry of Municipal Affairs and Housing should have devised a province wide planning procedure by now.
Municipal Groundwater Protection - Legal Tools
Groundwater protection has been an ongoing concern for municipalities. Doug Petrie and Marc McAree recently completed a comprehensive study and report on legal tools for groundwater protection for a client group of Ontario municipalities. Willms & Shier is working with several municipal clients on improving their legal and planning framework for groundwater protection. Call Doug or Marc for legal advice to help your municipality assess and/or upgrade your groundwater protection policies and by-laws.
Agriculture Minister Supports Municipal Interim Controls
Minister of Agriculture, Food and Rural Affairs Ernie Hardeman issued a Direction to the Normal Farm Practices Protection Board Under the Direction, no proposed agricultural practice under the jurisdiction of municipalities that have passed interim control by-laws can be ruled normal until the municipality passes a full by-law.
OMAFRA To Introduce Mandatory Agricultural Standards Bill
On July 10 OMAFRA released Proposed Standards For Agricultural Operations In Ontario, describing proposals for new legislation to be introduced in the Legislature in fall 2000. Based on Task Force consultations early in 2000, the new law will establish mandatory standards for nutrient management plans, minimum distance separation and building and manure storage standards. Livestock and farming operations will be classified, with more stringent requirements for more “intensive” operations.
The bill will impose penalties and provide power to order compliance and clean-up.
OMAFRA is conducting consultations over the summer to determine whether enforcement should be undertaken by the province, by municipalities or both. More details are posted on the web at www.gov.on.ca/OMAFRA.
Ontario: Oak Ridges Moraine: Private Member Bills
There are two private member bills that could affect development on the Oak Ridges Moraine before the legislature at the time of publication. One, the Ontario Natural Heritage Act (Bill 78) was introduced by ex-MMAH Minster Steve Gilchrist on May 30, 2000. Another, promoting a development freeze pending development of a coherent provincial policy affecting the moraine, was given second reading on June 1, 2000. The latter, Bill 71, the Oak Ridges Moraine Green Planning Act, 2000, was introduced by Shelly Martel (NDP), member for Nickel Belt. A third bill, the Oak Ridges Moraine Protection and Preservation Act, 1999, was defeated at Second Reading on June 22, 2000. It was introduced in November 1999 by Mike Colle (Liberal) from Toronto, and proposed the establishment of an Oak Ridges Moraine Commission, as was done for the Niagara Escarpment.
A useful site for legislative status and related research is Ontario's legislative library http://www.ontla.on.ca/library/libraryindex.htm.
Willms & Shier Welcomes New Lawyer, Researcher
Willms & Shier is please to introduce a new member of our legal team. Yelena Faynblyum is an Osgoode Hall graduate, called to the Bar this year. She gained experience in environmental, municipal and energy law and litigation while articling at Ontario Hydro. In addition to her law degree, Yelena studied in the Masters of Environmental Studies program at York University.
We are also pleased to welcome our summer research intern, Danielle Fremes. Danielle is a student in the Masters of Environmental Studies program and conducts research on administrative, policy and technical issues.
Donna Shier will moderate a panel on Certificates of Approval - New Processes and Pilots at the Canadian Institute Conference on New Developments in Environmental Law on October 26, 27, 2000.
Marc McAree will speak on contaminated land issues at the Perth County Real Estate Association on Sept. 20, 2000 and at the Toronto Real Estate Board on Sept. 27, 2000.
Marc will speak at the U. of T. Engineering Continuing Education Facilities Management Conference on Oct. 2, 2000
Last fall Willms & Shier conducted a client satisfaction survey of a representative group of our clients. The results were quite helpful. We achieved an approximately 40% reply rate to our written questionnaire. Most of the respondents were satisfied and gave us high marks across the board. A couple of respondents pointed out specific issues that required attention. The survey provided us with a formal way to obtain this helpful feedback and nip problems in the bud. We are planning to do another survey in the future. Meanwhile, we encourage all of our clients to make sure to be frank with us when service issues arise.
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| Revised:May 25, 2001. ©Willms & Shier Environmental Lawyers LLP, 2004. |
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