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WILLMS & SHIER MUNICIPAL
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WILLMS & SHIER MUNICIPAL
/ CORPORATE REPORT
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| SPRING 2003 |
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CONTENTS
| Alert - Asbestos Contaminated Home Insulation |
| Brownfields: Clean-up Regulations Published |
| 3 New Lawyers Join W&SEL |
| Virginia MacLean, Q.C. For Bencher |
| Engagements of Note |
Carcinogenic asbestos fibres may be contaminating hundreds of thousands of Canadian homes. Vermiculite attic insulation sold under the trade name Zonolite from 1940 to 1984 is contaminated with tremolite, an extremely carcinogenic form of asbestos. Not all vermiculite is contaminated with asbestos. Zonolite came from the W. R. Grace mine in Libby, Montana. Recent studies show that disturbing Zonolite insulation, for example by renovating or moving boxes in the attic, results in the emission of high concentrations of asbestos fibres. The US Environmental Protection Agency is scheduled to make a major announcement about Zonolite this spring.
Like urea formaldehyde foam insulation (UFFI), Zonolite was eligible for Canada's CHIPs program, providing assistance to homeowners from 1977 to 1984. Only professional testing can determine whether particular vermiculite samples are contaminated. Undisturbed vermiculate poses very low risk. However, repairs or renovations, including rewiring and cabling, or even occasional access to the attic, may contaminate the indoor air.
If there is a risk of disturbing the insulation, it should be removed by professionals and handled and disposed according to General Waste Regulation 347 under the EPA.
Real estate lawyers, agents, home inspectors, insurers and lenders will all need to consider policies and practices to limit liability when representing vendors and purchasers of homes that are potentially insulated with Zonolite.
Visit www.pinchin.com for links to more information.
On February 28, 2003 the MOE published a draft Environmental Protection Act Brownfields regulation. Together with draft standards and companion documents it will replace the Guideline For Use At Contaminated Sites In Ontario. The regulation will take effect along with the EPA Brownfield Amendments.
See our Online Compliance Centre at www.willmsshier.com/compliance
for commentary and downloads.
The Guideline criteria will be adopted unchanged as the new regulatory standards. The regulation will not be a stand-alone document. Users will have to consult Canadian Standards Association (CSA) Phase I and Phase II site assessment standards, as modified by the regulations.
Risk assessments will be more complex and will require two MOE submissions; only one has a response deadline, and only one is binding on the MOE. Risk assessments must be conducted according to separate documents on risk and analytical assessment procedures.
The new framework will continue to minimize MOE involvement. Even after clean-ups are completed and notice is filed on the Environmental Site Registry, new purchasers and lenders will have to conduct their own environmental due diligence. Neither the MOE nor the remediation consultants will be liable to third parties for mistakes.
The current MOE Guideline clean-up criteria will be adopted as the new regulatory standards. A revised Record of Site Condition (RSC) will constitute the formal documentation of a clean-up. RSCs will be filed in an Environmental Site Registry with public access. Risk assessments (SSRAs) will still require approval by the MOE.
Filing of an RSC does not provide any protection against lawsuits by neighbours. Once an RSC is filed in the Registry, future purchasers and lenders will have limited protection against regulatory liability except where:
The regulation extends this protection to past owners who sell a property to a purchaser on condition that the purchaser will file an RSC, and if the purchaser actually files the RSC.
The regulation creates two classes of "qualified person" (QP). One class may supervise all activities except risk assessments. This group includes licensed professional engineers, professional geoscientists, registered applied science technologists and certified engineering technicians and technologists. No previous experience is required. Qualified persons supervising risk assessments (QPRA) require a university science or engineering degree and five to eight years of environmental site assessment experience, including at least two years of risk assessment experience.
Environmental professionals and their insurers have persuaded the MOE to limit civil liability of QPs. The public Environmental Site Registry will carry a warning to anyone dealing with property to consider conducting their own environmental due diligence "in addition to reviewing information in the Registry." Every RSC will include "Covering Statements" by QPs to limit their liability to third parties, including a declaration that by signing the RSC the QP makes "no express or implied warranties or guarantees."
QPs must list the reports that they relied on in the RSC, and retain copies for seven years. However, there is no regulatory mechanism for a potential purchaser or others to gain access to these reports, except where the MOE has copies that can be requisitioned under freedom of information laws.
The regulation defines seven categories of land use: agricultural and other; parkland; residential; institutional; community; commercial; and industrial. The first four are the most sensitive uses and the regulation details the circumstances where changes from community, commercial and industrial uses will require filing of an RSC.
Changes of use from commercial to residential or parkland will not need RSCs unless, during the previous 10 years, the property was used for industrial purposes, or for a garage (auto service), bulk liquid dispensing (fuel, solvents) or dry cleaning operations. The rationale is that commercial properties such as office buildings are rarely sources of contamination. However, office buildings that hosted dry cleaners and malls with gas stations pose higher risks, and will require RSCs for change to more sensitive uses. The 10 year limit is arbitrary, and the MOE is considering alternatives.
A proposed new definition of "shallow soil property" will provide more flexibility for clean-ups on sites, especially in Eastern Ontario, with less than two metres of soil over bedrock.
The new clean-up regime should contribute to a more uniform process for developers and municipalities. It is difficult to anticipate the impact on property values of posting an RSC on the Environmental Site Registry. Will there be any devaluation of neighbouring properties?
Risk assessment will still be complex, time-consuming and dependent on the ability of MOE to develop consistent policies and timely responses.
Since new purchasers and lenders cannot rely on RSCs filed in the Environmental Site Registry, transaction costs may be increased by unnecessary reinvestigations, or the cost of buying a reliance agreement from the QP who certified the RSC. Perhaps real estate title insurers will see this as a good business opportunity and step in to offer environmental coverage for properties with duly filed RSCs.
The 60 day comment period ends on April 29th.
Visit our online compliance centre at www.willmsshier.com to download the regulation and documents.
W&SEL welcomes three new lawyers to our environmental law team.
Sharon Crowe - Sharon was called to the Bar of Ontario in 2002, where she graduated from University of Western Ontario's Law School. She studied environmental law and was active in the UWO Environmental Law Association. Sharon has been practising environmental law at W&SEL since October 2002.
Carolyn Shaw - Carolyn was called to the Bar of Nova Scotia in 2002. She holds an LL.B. from Dalhousie with a Certificate of Specialization in Marine Law. Carolyn holds a B.Sc. (Hon) in Marine Biology from Dalhousie. Carolyn joined W&SEL in February 2003 as a Transfer Candidate.
Paula Boutis - Paula was called to the Bar of Ontario in 2001. She holds an LL.B. from Dalhousie with a Certificate of Specialization in Environmental Law. Paula holds a Masters of Science (Biology) and a B. Sc. (Hon.) in Biology and Environmental Studies, both from McGill. Paula joins W&SEL full time in April, 2003.
Willms & Shier Environmental Lawyers is pleased to support Virginia's campaign for election as Bencher on the governing body of the Law Society of Upper Canada. Currently Virginia is President of the Ontario Bar Association, one indication of her commitment to the legal profession.
Marc McAree and P. Douglas Petrie are course leaders for Fundamentals of Environmental Law in Ontario, The Canadian Institute, April 24-25, 2003.
Marc McAree is chairing and Virginia MacLean is speaking at The Environment and Municipalities, Ontario Bar Association Annual Institute, March 21, 2003.
Virginia MacLean is speaking on Personal Liability for Directors and Officers of the Water System at Managing Your Obligations Under The Safe Drinking Water Act, The Canadian Institute, April 8, 2003.
ENVIRONMENTAL MANAGEMENT, COMPLIANCE AND ENGINEERING 2003