Date: 20050719
Docket: A-509-04
Citation: 2005 FCA 261
CORAM: LINDEN J.A.
SEXTON J.A.
SHARLOW J.A.
BETWEEN:
MINISTER OF THE ENVIRONMENT and
the CANADIAN ENVIRONMENTAL ASSESSMENT AGENCY
Appellants
and
BENNETT ENVIRONMENTAL INC.
Respondent
and
EEL RIVER BAR FIRST NATION, PABINEAU FIRST NATION, MICMAC OF
GESGAPEGIAG, LISTUGUJ MICMAC GOVERNMENT AND
THE BELLEDUNE CITIZENS COMMITTEE
Interveners
Heard at Toronto, Ontario on June 2, 2005.
Judgment delivered at Ottawa, Ontario on July 19, 2005.
REASONS FOR JUDGMENT BY: SHARLOW J.A.
CONCURRED IN BY: LINDEN J.A.
SEXTON J.A.
Date: 20050719
Docket: A-509-04
Citation: 2005 FCA 261
CORAM: LINDEN J.A.
SEXTON J.A.
SHARLOW J.A.
BETWEEN:
MINISTER OF THE ENVIRONMENT and
the CANADIAN ENVIRONMENTAL ASSESSMENT AGENCY
Appellants
and
BENNETT ENVIRONMENTAL INC.
Respondent
and
EEL RIVER BAR FIRST NATION, PABINEAU FIRST NATION, MICMAC OF
GESGAPEGIAG, LISTUGUJ MICMAC GOVERNMENT AND
THE BELLEDUNE CITIZENS COMMITTEE
Interveners
REASONS FOR JUDGMENT
SHARLOW J.A.
[1] A press release issued on June 14, 2004, by the Canadian Environmental Assessment Agency says that on that day, the Minister of the Environment announced "the referral of the Bennett High-Temperature Thermal Oxidizer Project, located in Belledune, New Brunswick, to a review panel". Apparently there is no other documentary record of the Minister's decision. The stated statutory authority for the referral was section 46 and section 48 of theCanadian Environmental Assessment Act, S.C. 1992, c. 37 (the CEAA).
[2] On July 13, 2004, Bennett commenced an application for judicial review in the Federal Court seeking, among other things, an order quashing the referral. That application was heard on an expedited basis on August 13, 2004, and it was successful. The Judge's reasons are reported as Bennett Environmental Inc. v. Canada (Minister of the Environment) (2004) 18 Admin. L.R. (4th) 108, (2004) 10 C.E.L.R. (3d) 315 (F.C.).
[3] Before this Court is an appeal of the Judge's order by the Minister and the Canadian Environmental Assessment Agency (collectively, the "Crown").
[4] These reasons are organized under the following headings:
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Paragraph
Facts
High-temperature thermal oxidizer 5
The location of the Belledune HTTO facility 6
Intended use of the Belledune HTTO facility 8
Provincial environmental approval 10
Condition 9 - The human health risk assessment 15
The Approval to Construct - September 9, 2003 25
The Draft Approval to Operate - February 18, 2004 27
The Petitions - October 2003 31
Health Canada's review - January and February, 2004 36
Environment Canada's Review of Transboundary Petitions - April 21, 2004 40
Health Canada's further letters to the Agency - May 3 and May 17, 2004 41
Agency's Analysis of Transboundary Effects - May 17, 2004 43
Press release - May 21, 2004 47
Bennett's response to the press release 49
The Minister's decision - June 14, 2004 50
The challenge to the Minister's decision 51
Appeal by the Minister and the Agency 54
Current status of the Belledune HTTO facility 55
Issues 58Standard of review 60
The law 63
Was the Belledune facility a "project' when it was referred to a review panel? 74
The second ground of appeal: the prohibition order against the Agency 90
Reasonableness of the Minister's decision 94
General comments on the fairness of the procedure followed by the Minister 101
Conclusion 104
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Facts
High-temperature thermal oxidizer
[5] A high-temperature thermal oxidizer (HTTO) exposes contaminated material to high temperatures in order to separate, remove and destroy the contaminants. Contaminants that are organic compounds are destroyed by combustion in a high temperature secondary combustion chamber. Gasses resulting from that process are subjected to scrubbing and filtering to reduce or remove other contaminants. What remains is released into the air.
The location of the Belledune HTTO facility
[6] The Belledune HTTO facility is located on a 20 acre parcel of land within an industrial park near the port area of Belledune, New Brunswick. That area has for many years been the site of heavy industry, including a lead-zinc smelter and a coal-fired generation station. The active portion of the facility occupies approximately 10 acres. The balance serves as a buffer zone.
[7] The Baie-des-Chaleurs is located approximately 1.3 kilometres from the Belledune HTTO facility. The border between Quebec and New Brunswick is approximately 23 kilometres away. The three closest Indian reserves are the Gesgapegiag Indian Reserve (32 kilometres away), the Eel River Bar Indian Reserve (41 kilometres away), and the Pabineau Indian Reserve (44 kilometres away).
Intended use of the Belledune HTTO facility
[8] The present intention of Bennett, and the basis of all approvals Bennett has obtained so far from New Brunswick provincial officials, is to use the Belledune HTTO facility to treat up to 100,000 tonnes per year of non-chlorinated hydrocarbon and creosote impacted soils and other solid materials, mainly from brownfield site remediation projects in North America. The Belledune HTTO facility is not intended to be used to treat material containing chlorinated compounds or PCBs.
[9] The Belledune HTTO facility is designed specifically for its intended purpose. It is not clear whether the design of the Belledune HTTO facility is such that it could never be used for a purpose other than its currently intended use. However, I assume that a change in the use of the Belledune HTTO facility would not be permitted without provincial approval. (Indeed, there is a condition to that effect in the draft Approval to Operate, referred to below.)
Provincial environmental approval
[10] Before commencing the construction of the Belledune HTTO facility, Bennet was required to obtain an approval under the Environmental Impact Assessment Regulations (87-83), enacted under the Clean Environment Act, R.S.N.B. 1973, c. C-6. The process of obtaining that approval began in August of 2002.
[11] Bennett's proposal for an HTTO facility in Belledune was considered by a Technical Review Committee consisting of representatives of a number of departments of the New Brunswick government, and representatives of the federal Department of the Environment and the Department of Fisheries and Oceans. The record does not explain why the provincial Technical Review Committee included federal environmental officials. I assume it was done for the laudable purpose of sharing information and expertise between federal and provincial environmental officials.
[12] The Technical Review Committee raised a number of issues that apparently were addressed to their satisfaction. On January 17, 2003, the New Brunswick Minister of the Environment and Local Government granted Bennett a "Certificate of Determination", which permitted Bennett to proceed with its proposal, subject to twenty-four conditions.
[13] For the purposes of this appeal, the most important conditions imposed on Bennett in the Certificate of Determination are these:
(1) The undertaking was to be commenced within three years of the date of the Certificate of Determination, unless extended by the New Brunswick Minister of the Environment and Local Government (condition 2).
(2) Bennett was authorized to import to New Brunswick only creosote and non-chlorinated hydrocarbon contaminated soil (condition 3).
(3) Any proposal to use treated material in a value-added marketable soil product would require separate approval (condition 8).
(4) Bennett was required to conduct a human health risk assessment, including air deposition modelling to determine scope, nature and impacts of all deposition, including incremental impacts, from the operation of the facility. That assessment was to be completed and approved by provincial health officials prior to the issuance of an Approval to Construct and an Approval to Operate (condition 9).
(5) Bennett was required to hold a public information meeting in Belledune within 30 days (condition 10).
(6) By March 1, 2003, Bennett was to establish a Community Environmental Liaison committee for the construction and operation of the facility (condition 11).
(7) Bennett was to instal a continuous emission monitoring system to monitor emissions, including sulphur dioxide, nitrogen oxides, carbon monoxide, hydrogen chloride, total volatile organic compounds, and gas flow rate (condition 12).
(8) Prior to issuance of an Approval to Operate, Bennett was required to install pollution control equipment that will ensure that the emissions from the facility are lower than the 2006 limits established in the CCME Canada Wide Standard for Hazardous Waste Incineration (condition 13).
(9) Prior to issuance of an Approval to Construct and an Approval to Operate, Bennett was required to prepare and submit for approval an in-situ soil monitoring program and a groundwater monitoring program (conditions 14 and 15).
(10) Bennett was required to prepare an environmental protection plan illustrating mitigation measure to be put in place for the construction, operation and maintenance phases (condition 19).
(11) After approval of conditions 8, 9, 13, 14, 15 and 19, Bennett was required to obtain an "Approval to Construct" and an "Approval to Operate" under the Water Quality Regulation (82-126) (enacted under the Clean Environment Act) and the Air Quality Regulation (97-133) (enacted under the Clean Air Act, S.N.B. 1997, c. C-5.2) (condition 20).
[14] It is not alleged that Bennett failed to meet any of the conditions set out in the Certificate of Determination.
Condition 9 - The human health risk assessment
[15] With respect to condition 9 in the Certificate of Determination (the human health risk assessment or HHRA), the evidence submitted by Bennett explained in considerable detail how that condition was met. The relevant information is found in the affidavit sworn on July 12, 2004, by Denis L. Marquis, Senior Air Quality Engineer with Jacques Whitford Limited, which was retained by Bennett to assist it obtaining environmental approvals for the Belledune HTTO facility. Mr. Marquis was cross-examined on a number of issues, but the cross-examination touched very little on the methodology of the HHRA, or its results.
[16] The HHRA was based on a widely accepted protocol. The methodology involves the prediction of potential environmental effects based on facility design considerations as well as operating experience with similar facilities to determine the expected ground level concentrations of contaminants to which people may be exposed once the facility starts to operate. This was accomplished through a dispersion model and a deposition model. The dispersion model predicts ground level concentrations of the expected airborne emissions from the Belledune HTTO facility, giving information about what people might breathe in. The deposition model predicts the levels at which contaminants in the area surrounding the facility would accumulate over time and cause exposure to people through, for example, direct contact with soil, dust re-suspension, leaching into surface water, and accumulation in edible plants and animals.
[17] The resulting dispersion and deposition rates were then used in a human health risk assessment model, together with information on the toxicity of the relevant chemicals and the extent of exposure through various exposure routes. The predicted exposures were compared to published health and environmental standards or guidelines to quantify the level of risk to human health from the operation of the facility.
[18] The dispersion and deposition modelling for the Belledune HTTO facility was designed to predict the maximum ground level concentrations of contaminants from the facility in ambient air within a 10 kilometre radius, as well as the rate of deposition of such contaminants. The model was based on the theory that ground level concentrations and deposition rates increase with increasing distance from the source, reach a maximum level at a certain point, and then decrease with increasing distance from the source.
[19] As these calculations are dependent on weather conditions, including wind speed and direction, the model used a five year historical record of observed weather information thought to be representative of the area. The result was a collection of maximum ground level concentrations and deposition rates over a five year period, which were compared with established ambient air quality standards.
[20] The highest overall predicted maximum ground level concentrations and deposition rates within the 10 kilometre radius were selected as the values that would be input into the HHRA model for health risk calculations. That is, the study determined the maximum value, at the "maximum point of impingement" ("MPOI"), of each contaminant at ground level. The resulting maximum values were selected as inputs to the human health risk calculations.
[21] The overall MPOI was determined by the model to be approximately 200 metres to the south of the property boundary of the proposed Belledune HTTO facility. Evaluating the human health risks at the location of the overall highest concentrations and deposition rates would represent the maximum health risks to which a potential human receptor would hypothetically be exposed. By definition, the ground-level concentrations, deposition rates, and human health risks at any other location would be less than at the MPOI.
[22] A number of other assumptions were made in the human health risk model in an attempt to over-estimate the actual risks to people. For example, a hypothetical residence with a vegetable garden was placed at the MPOI, 200 metres from the facility (which is now zoned industrial and consists of forested land). It was assumed that people residing at that location were exposed to those ground-level concentrations and deposition rates constantly throughout a 70 year lifetime, that the only garden produce they would eat throughout their lifetime would be from that garden, and that they would procure their drinking water from the Belledune headpond (which in fact is not a source of drinking water for any Belledune resident).
[23] The conclusion reached in the HHRA study was that the Belledune HTTO facility would not add appreciably to the existing level of contaminants in the Belledune area, and overall the maximum ground level concentrations predicted by the model to result from the Belledune HTTO facility were less than 5-25% of the allowable ambient air quality standards in New Brunswick for all contaminants. The resulting ground level concentrations at any distance beyond the maximum levels observed at the MPOI would be less than at the MPOI, whether 10 kilometres or 100 kilometres away.
[24] The HHRA study concluded, on the basis of an evaluation of the potential human health risks to receptors at the MPOI, that no adverse acute or chronic human health effects were expected to occur as a result of the operation of the Belledune HTTO facility. The useful range of resolution and accuracy of the model used in this study is 50 kilometres from the source. However, the resolution and accuracy of the model is reduced at approximately 20 kilometres, beyond which there is an increase in the level of uncertainty in the model. More rigorous dispersion and deposition models exist for studies covering longer distances, but Bennett thought the use of those other models was not warranted because of the low predicted concentrations from the study they did conduct. The provincial authorities apparently agreed because, as indicated above, they accepted Bennett's HHRA as the fulfilment of condition 9 of the Certificate of Determination.
The Approval to Construct - September 9, 2003
[25] In addition to the Certificate of Determination, Bennett required an Approval to Construct under the New Brunswick Water Quality Regulation and the Air Quality Regulation. The Approval to Construct was issued on September 9, 2003. Construction of the Belledune HTTO facility began on or about September 15, 2003. For the purposes of this appeal, the most relevant provisions of the Approval to Construct read as follows:
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The High Temperature Thermal Oxidizer (HTTO) in Belledune, New Brunswick is hereby approved for construction in accordance with the terms and conditions hereunder specified.
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[...]
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7. The issuance of this Approval does not relieve the Approval Holder from compliance with any other applicable federal or provincial acts and regulations, as well as local bylaws.
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[...]
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9. Subject to Condition 16 below, this Approval to Construct only allows operation of the facility for the purposes of commissioning and performance testing. Prior to the full commercial operation of the High Temperature Thermal Oxidizer (HTTO) facility, the Approval Holder shall obtain an Approval to Operate for this facility.
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[...]
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16. Prior to commencing commissioning of the HTTO facility, the Approval Holder shall submit a commissioning plan to the Director for review and approval. The plan must contain, as a minimum, a detailed commissioning schedule, the amount of contaminated soil and the characteristics of the contaminated soil to be processed during commissioning.
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[...]
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25. The Approval Holder shall design and construct the High Temperature Thermal Oxidizer (HTTO) facility capable of limiting the emissions from the thermal treatment process stack to within the following limits, expressed at standard conditions of 25EC and 101.3 kPa and corrected to 11% oxygen:
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Concentration limits for: Thermal Treatment Process Stack
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Parameter & Unit
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Maximum
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Carbon Monoxide / mg/m3
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57
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Hydrogen Chloride / mg/m3
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27
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Sulphur Dioxide / mg/m3
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56
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Total Suspended Particulate Matter / mg/m3
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17
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Cadmium / Fg/m3
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14
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Mercury / Fg/m3
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50
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Lead / Fg/m3
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142
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Nitrogen Oxides / mg/m3
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207
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Total Hydrocarbons (as Methane) / mg/m3
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7
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Total Dioxins/Furans / ng I-TEQ/m3
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0.08
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[...]
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27. Prior to the issuance of an Approval to Operate the Approval Holder shall ensure that performance tests are carried out on thermal treatment process stack and the ventilation system stack, for all parameters listed in condition 25, in accordance with Sections 16, 17 and 18 of the Air Quality Regulation - Clean Air Act, and using normally accepted practice as published by Environment Canada or the United States Environmental Protection Agency. Furthermore, such testing shall be consistent with the Department's Code of Practice for Source Testing. A pretest plan of the methods to be used shall be submitted to the Department for review and approval at least two weeks prior to commencement of performance testing.
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[...]
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30. Prior to the issuance of an Approval to Operate the Approval Holder shall ensure that a continuous emission monitoring (CEM) system is installed on the thermal treatment process stack to measure the rates of discharge of sulphur dioxide (SO2), nitrogen oxides (NOx), carbon monoxide (CO), carbon dioxide (CO2), hydrogen chloride (HCl), total hydrocarbons (THC), oxygen (O2), moisture (H2O), as well as temperature, and gas flow rate. The Approval Holder shall ensure that Relative Accuracy Test Audits (RATAs) are performed on the CEM system for all parameters specified above.
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31. Prior to the issuance of an Approval to Operate the Approval Holder shall ensure that a continuous emission monitoring (CEM) system is installed on the ventilation system stack to measure the rate of discharge of total non-methane hydrocarbons (TNMHC). The Approval Holder shall ensure that Relative Accuracy Test Audits (RATAs) are performed on the CEM system for all parameters specified above.
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[...]
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34. The Approval Holder shall submit a report on the results of the performance testing as required in condition 27 to the Director for review, within 90 days following the completion of the testing. As a minimum, the report shall provide accurate emissions data on all parameters listed in condition 25. Emission results related to thermal treatment process stack shall be expressed at standard conditions of 25EC and 101.3 kPa and corrected to 11% oxygen. Emission results related to the ventilation stack shall be expressed at standard conditions of 25EC and 101.3 kPa.
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[...]
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37. The Approval Holder shall submit to the Director a report on the certification of the continuous emissions monitoring (CEM) system as required in condition 30 and 31 of this Approval. The report shall be submitted, within 90 days following the completion of the field component of the RATA tests, by e-mail, fax, or mail, provided that person designated responsible by the Approval Holder signs the report.
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38. Prior to November 01, 2003, the Approval Holder shall submit to the Director for review and approval, a plan for the installation and operation of two ambient monitoring stations that are capable for measuring fine particulate matter of less than or equal to 10 microns in diameter (PM10) and 2.5 microns in diameter (PM2.5).
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[26] The Approval to Construct also includes conditions requiring a detailed soil monitoring program and a detailed groundwater monitoring program, with related reporting requirements.
The Draft Approval to Operate - February 18, 2004
[27] After the issuance of the Approval to Construct, Bennett required an Approval to Operate under the Air Quality Regulation and the Water Quality Regulation. The process of obtaining the Approval to Operate required, in addition to fulfilling the conditions in the Approval to Construct, a 180 day public review process. The public review process started on November 27, 2003, and ended on April 19, 2004. A draft Approval to Operate was made available for public review on February 18, 2004.
[28] The draft Approval to Operate indicates a proposed effective date of July 1, 2004, and a term ending on June 30, 2009. It sets out detailed conditions and standards for the transportation of contaminated material by truck, rail or ship, the storing and stockpiling of materials, the testing of contaminated material prior to treatment, emission limits, process gas controls, financial security and insurance, testing, monitoring, and monthly and annual reporting. In addition, it sets out specific periods of notice to be given for a renewal of the Approval to Operate, for approval of a change in operations, or for any planned closure of the facility.
[29] The conditions in the draft Approval to Operate in many ways reflect the conditions in the Approval to Construct. For example, the emission limits in the draft Approval to Operate are the same as those in the Approval to Construct.
[30] At the time of the publication of the draft Approval to Operate, there had been no public response by the Minister to the October 2003 petitions described below.
The Petitions - October 2003
[31] The Minister received two letters in late October, 2003, requesting his intervention in the matter of the Belledune HTTO facility.
[32] The first letter, dated October 21, 2003, is from a number of different individuals and groups in New Brunswick and Quebec, including Environnement Vie Péninsule Acadienne, Ralliement gaspésien et madelinot, Committee for Anglophone Social Action (Gaspé Peninsula), Groupe de médecins et dentistes de la Gaspésie, Table des préfets de la Gaspésie, and Table agroalimentaire de la Gaspésie. It cites a number of studies from 1984 to 2001 that indicated significant environmental problems in the Belledune area, and after referring to subsection 46(1) of the CEAA, states as follows:
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14. The proposed toxic waste incinerator in Belledune is expected to release 85 metric tonnes of pollutants into the atmosphere including 6 mt of semivolatile organic compounds and 6 mt of hydrocarbons (Bennett Environmental Inc. Air Quality Assessment for the Belledune Project).
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15. The environmental assessment for the Belledune toxic waste incinerator did not consider the cumulative impact of atmospheric deposition to the airshed or the marine environment of Bay of Chaleur which includes Quebec.
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16. It is our view that "the project may cause significant adverse environmental effects in" Québec as well as in New Brunswick and, therefore, we request the Minister order an immediate halt to construction of the toxic waste incinerator, and refer the project to a mediator or an independent review panel.
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[33] The second letter is dated October 31, 2003 and is from the elected Chiefs of the Micmacs of Gesgapegiag, the Pabineau First Nation, the Listuguj Micmac Government, and the Eel River Bar First Nation. It raises a number of concerns about the potential environmental effects of the Bennett HTTO facility. The letter states in part as follows:
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We are also concerned about the manner in which this project has been promoted. Governments have not exercised fully those prerogatives, which have been put in place by their respective governments to protect first and foremost the health of their constituents, the environment, and those dependent upon the environment for their livelihood. We are very concerned about the local immediate contamination, and pollution from the dioxin and furan fallout.
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[...]
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We therefore insist Mr. Minister that you use the tools provided to you through the government of Canada to not only insist that our rights be protected and respected. Take the necessary steps to assure the safety and protection of not only our health but also the health of our traditional lands and all that is provided therein by the Creator for our sustenance. We demand that you begin to uphold your fiduciary obligations to us by intervening immediately by implementing a moratorium immediately.
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[34] The Minister treated these letters as petitions seeking a referral to a review panel under subsection 46(1) and subsection 48(1) of the CEAA. As explained in more detail below, those provisions authorize the Minister in certain circumstances to refer a project to a federal environmental review panel even though the project is not otherwise subject to any federal regulatory control.
[35] In October, 2003, Bennett was advised that the Minister had received the petitions, and that the Agency was going to conduct an investigation to determine whether a reference to a review panel was warranted. As of the date of the Minister's decision that is the subject of this appeal, Bennett had not been provided with a copy of either petition.
Health Canada's review - January and February, 2004
[36] After the Minister's receipt of the petitions in October, 2003, the Agency started to work on a report to advise the Minister with respect to a response. It is not clear whether the record contains a complete picture of all of the work that was done. However, it is clear that the Agency consulted with Health Canada to obtain information and advice about the health issues mentioned in the petitions, and about the HHRA that had been submitted by Bennett in respect of condition 9 of the Certificate of Determination.
[37] On January 20, 2004, there was a conference call between officials of the Agency and officials of Health Canada. Health Canada then sent a letter to the Agency setting out a number of preliminary questions to be put to Bennett. No specific questions were asked about the possible health effects of the Belledune HTTO facility on areas outside Quebec or on any of the Indian reserves identified in the petition from the Chiefs. However, the Health Canada letter makes the following comments about transboundary effects (the government documents in the record use the term "transboundary" to refer to all areas referred to in the petitions, including the Baie-des-Chaleurs, communities in Quebec nearest to Belledune, and all of the Indian reserves referred to in the October 30, 2003 petition):
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Please note that HC [Health Canada] is still uncertain about whether this project will have transboundary impacts. HC does not undertake the risk assessments, rather, they only review those submitted by the proponents. In this case, transboundary impacts have not been declared, either to us or to the proponent. Since the proponent has not been informed, its submission excludes transboundary assessment. The potential transboundary impacts (or lack thereof) from the proposal are not addressed in the documents submitted by the proponent and, therefore, can not be fully evaluated at this time. Potential transboundary impacts should be evaluated by the proponent and submitted to HC for review and comment.
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[38] On February 4, 2004, Bennett provided a lengthy and detailed response to the specific questions posed by Health Canada. The answers referred extensively to the HHRA that had been done in respect of condition 9 of the Certificate of Determination. As none of the specific questions related to transboundary effects, Bennett did not address that issue.
[39] Before receiving Bennett's February 4, 2004, letter, Health Canada sent the Agency a letter dated February 2, 2004, which says in part:
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Health Canada still needs more information in order to give technical advice to the Agency on the potential of this project to cause significant health impact to the transboundary communities that may be affected by this project. From an exposure standpoint, transboundary effects would include nearby inhabitants of Indian reserves as well as inhabitants of the villages and towns on the Southern part of Québec (Gaspésie). [The letter then sets out a list of 6 Indian reserves in New Brunswick and Québec (including Pabineau, Eel River Bar, Gesgapegiag and Listuguj), and 9 other communities in Québec, all located within 32 to 96 kilometres of Belledune.]
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Considering the nature of this investigation, Health Canada requests Environment Canada and/or the proponent to provide information on the environmental impacts of the project at the location of the transboundary communities identified above. What will be the concentration of contaminants in the soil, the air and foods, including the cumulative impacts, on the province of Quebec and First Nations Lands? What will be the projected air particulate deposition rate for transboundary communities? What will be the estimated concentrations of metals in the particulate matter? What will be the anticipated soil metal accumulation over the lifetime of the facility? What are the implications for the country foods, gardens, etc.? Also, Health Canada would like to obtain more information from Environment Canada on the impact of potential accidents and malfunctions to the transboundary communities.
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Environment Canada's Review of Transboundary Petitions - April 21, 2004
[40] Certain experts with Environment Canada prepared for the Agency a lengthy and detailed report dated April 21, 2004, dealing with the issues that it considered had been raised by the petitions. The conclusion is set out on page 23 of the report, and reads as follows:
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With respect to the transboundary petition, it is EC's opinion that the concentrations of transported contaminants would be so low that, in terms of EC's mandate, the HTTO is unlikely to result in significant adverse environmental effects on federal lands (First Nations reserves, Baie des Chaleurs), or the Province of Quebec. EC has, however, identified issues that merit attention in provisions for management of the facility and will be providing these directly to the New Brunswick Department of Environment and Local Government.
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Health Canada's further letters to the Agency - May 3 and May 17, 2004
[41] By letter dated May 3, 2004, Health Canada provided further advice to the Agency. By that time, Health Canada had received Bennett's response of February 2, 2004. In addition, Health Canada was aware of the April 21, 2004, report of Environment Canada, and a March 9, 2004, communication from the federal Department of Fisheries and Oceans concluding that "the proposed facilities are unlikely to cause a significant and noticeable increase in the contamination of habitat and resources in Chaleur Bay, or have toxic effects on invertebrate and fish populations in that ecosystem or downstream in the Gulf of St. Lawrence." The May 3, 2004, letter from Health Canada states the following conclusion:
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Based on the data and comments provided to Health Canada by the Agency, the proponent, Environment Canada and the Department of Fisheries and Oceans, it would appear that the concentrations of contaminants at transboundary locations does not have the potential to cause significant adverse environmental health effects. However, the data that Health Canada has received is too limited to say with absolute confidence that there are no human health concerns for transboundary communities.
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[42] On May 17, 2004, Health Canada sent a further letter to the Agency. It is not clear what prompted that letter. It reads in part as follows:
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I understand that New Brunswick has decided to monitor emissions from the site, and should the results indicate any unacceptable impacts to human health, the provincial authority would be prepared to modify or revoke the operating permit.
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Health Canada would be pleased to offer its expertise to New Brunswick in relation to human health impacts.
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Agency's Analysis of Transboundary Effects - May 17, 2004
[43] The Agency completed its investigations and prepared a report dated May 17, 2004. The report includes a number of appendices, including the April 21, 2004, report from Environment Canada, the Health Canada letters referred to above, and Bennett's response to Health Canada dated February 4, 2004.
[44] The body of the report summarizes the conclusions of the "study team", which included experts from Fisheries and Oceans Canada, Environment Canada, Health Canada, Indian and Northern Affairs Canada, and the Agency. In the body of the report, the conclusion of each department is stated, including the conclusion of Health Canada as set out in its May 3, 2004, letter (quoted above).
[45] The conclusion of the Agency's review team is stated at page 11 of the report, and reads as follows:
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The review team's opinion is that, based on available technical information, and considering the operating conditions proposed by the Province of New Brunswick, there is no reason to conclude that the project is likely to cause significant adverse transboundary environmental effects.
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[46] It appears that Bennett was provided with a copy of the Agency's May 17, 2004, report, with the appendices. It is not clear when that occurred. In any event, Bennett assumed when it received the report that, given the stated conclusion, the Minister would not refer the Belledune HTTO facility to a review panel.
Press release - May 21, 2004
[47] On May 21, 2004, the Agency issued a press release stating that the Minister had announced that he was giving notice, to Bennett, the governments of New Brunswick and Quebec, and the petitioners, of his intention to refer the Belledune HTTO facility to a review panel pursuant to subsections 46(1) and 48(1) of the CEAA. According to the press release, the reason for the decision is as follows:
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Although federal experts are of the opinion that the project is not likely to cause significant adverse transboundary environmental effects, the Minister decided that further assessment is needed because Health Canada is of the view that data are too limited to state with absolute confidence that there are no human health concerns for transboundary communities.
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[48] By letter dated May 25, 2004, the Agency sent a letter to Bennett with a copy of the May 21, 2004, press release. That was when Bennett first became aware of the letter from Health Canada dated February 4, 2004, setting out the points on which Health Canada considered more information was required.
Bennett's response to the press release
[49] Bennett wrote to the Agency on June 2, 2004, to say that it had not been aware of the questions posed in the Health Canada letter of February 4, 2004, and to ask for an opportunity to provide additional information before the Minister decided whether or not to refer the Belledune HTTO facility to a review panel. Neither the Agency nor the Minister responded to that letter. Mr. Marquis indicated on cross-examination that in all likelihood, answers to most of Health Canada's unanswered questions could have been given reasonably quickly (within a few weeks), although one of the questions might have taken a few months for a full response.
The Minister's decision - June 14, 2004
[50] On June 14, 2004, the Agency issued a press release stating that the Minister had announced his decision to refer the Belledune HTTO facility to a review panel.
The challenge to the Minister's decision
[51] On July 13, 2004, Bennett commenced an application in the Federal Court for judicial review of the Minister's decision to refer the Belledune HTTO facility to a review panel. The only named respondents were the Minister and the Agency. It is not clear why the application for judicial review did not name as respondents the Province of New Brunswick, the Province of Quebec, or any of the petitioners.
[52] The Eel River Bar First Nation, the Pabineau First Nation, the Micmac of Gesgapegiag, the Listuguj Micmac Government, and the Belledune Citizens Committee applied for leave to intervene in the Federal Court proceedings, and that application was granted. No other party sought leave to intervene.
[53] The application was heard on an expedited basis on August 13, 2004. The result was an order of a Judge of the Federal Court, dated August 19, 2004, quashing the Minister's decision. That Order reads as follows:
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THIS COURT grants judicial review, quashes the said decision, declares it null and void and prohibits the Canadian Environmental Assessment Agency from proceeding with a review of the matter, the whole with costs against the respondents. There shall be no order as to costs with respect to the interveners.
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Appeal by the Minister and the Agency
[54] On September 28, 2004, the Minister and the Agency appealed the August 19, 2004, Order. The Eel River Bar First Nation, the Pabineau First Nation, the Micmac of Gesgapegiag, the Listuguj Micmac Government, and the Belledune Citizens Committee sought and obtained leave to intervene in the appeal. The appeal was heard on June 2, 2005.
Current status of the Belledune HTTO facility
[55] The Belledune HTTO facility was substantially complete when the Minister decided to refer it to a review panel. As of July 9, 2004, Bennett had invested approximately $29 million in the facility.
[56] At the time of the hearing of this appeal on June 2, 2005, the performance testing contemplated by the Approval to Construct had not yet been completed, apparently because Bennett did not yet have a sufficient quantity of contaminated soil. No Approval to Operate had been issued.
[57] The building permit issued for the Belledune HTTO facility (which is not the same as the Approval to Construct) is the subject of a challenge before the New Brunswick Assessment and Planning Appeal Board. It is not clear whether the Approval to Construct is also in issue in those proceedings. It is common ground that Bennett may be at risk of losing its investment in the Belledune HTTO facility if the challenge is successful, but unless that occurs, Bennett is entitled to rely on the building permit and the Approval to Construct. For the purposes of this appeal, I have assumed that the building permit and the Approval to Construct are valid.
Issues
[58] Bennett's objection to the Minister's decision to refer the Belledune HTTO facility to a review panel is that when the decision was made on June 14, 2004, the construction of the facility was substantially complete. The main issue in this appeal is whether subsection 46(1) or subsection 48(1) of the CEAA gave the Minister the legal authority to refer the Belledune HTTO facility to a review panel at that time.
[59] Specifically, the question is whether, at the time of the Minister's decision, the Belledune HTTO facility was a "project" as defined in section 2 of the CEAA. According to the Judge, the answer is no. If that answer is correct, this appeal must be dismissed. Otherwise, this Court must consider the Minister's decision in more detail to determine whether, as Bennett argues, it should have been quashed on some other ground.
Standard of review
[60] The scope of the Minister's authority is a question of statutory interpretation. The Judge reviewed that aspect of the Minister's decision on the standard of correctness. In my view, he was correct to do so. As the same question of statutory interpretation is raised in this appeal, this Court also must apply the standard of correctness.
[61] If the Judge's interpretation of the statute is found not to be correct, then it will be necessary for this Court to consider the merits of the Minister's decision. The submission of the Crown, as I understand it, is that the standard of review should be reasonableness except with respect to questions of law, for which the standard of review should be correctness. The other parties did not address the standard of review. In my view, the Crown's position on this point is consistent with the relevant jurisprudence.
[62] The Crown also submits that, because the Minister's decision involves a significant discretionary element, it should not be disturbed if the discretion was exercised in good faith, in accordance with the law, and on the basis of relevant criteria and evidence. In my view, that submission is sound, although it addresses the question of the grounds of review rather than the question of the standard of review.
The law
[63] The resolution of any dispute about the meaning or application of a provision of the CEAA must begin with an appreciation of the purposes of the CEAA. Often, the purpose of a statute must be inferred. However, Parliament has chosen to express the purposes of the CEAA in section 4, which reads as follows:
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4. (1) The purposes of this Act are
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4. (1) La présente loi a pour objet_:
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(a) to ensure that projects are considered in a careful and precautionary manner before federal authorities take action in connection with them, in order to ensure that such projects do not cause significant adverse environmental effects;
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a) de veiller à ce que les projets soient étudiés avec soin et prudence avant que les autorités fédérales prennent des mesures à leur égard, afin qu'ils n'entraînent pas d'effets environnementaux négatifs importants;
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(b) to encourage responsible authorities to take actions that promote sustainable development and thereby achieve or maintain a healthy environment and a healthy economy;
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b) d'inciter ces autorités à favoriser un développement durable propice à la salubrité de l'environnement et à la santé de l'économie;
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(b.1) to ensure that responsible authorities carry out their responsibilities in a coordinated manner with a view to eliminating unnecessary duplication in the environmental assessment process;
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b.1) de faire en sorte que les autorités responsables s'acquittent de leurs obligations afin d'éviter tout double emploi dans le processus d'évaluation environnementale;
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(b.2) to promote cooperation and coordinated action between federal and provincial governments with respect to environmental assessment processes for projects;
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b.2) de promouvoir la collaboration des gouvernements fédéral et provinciaux, et la coordination de leurs activités, dans le cadre du processus d'évaluation environnementale de projets;
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(b.3) to promote communication and cooperation between responsible authorities and Aboriginal peoples with respect to environmental assessment;
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b.3) de promouvoir la communication et la collaboration entre les autorités responsables et les peuples autochtones en matière d'évaluation environnementale;
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(c) to ensure that projects that are to be carried out in Canada or on federal lands do not cause significant adverse environmental effects outside the jurisdictions in which the projects are carried out; and
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c) de faire en sorte que les éventuels effets environnementaux négatifs importants des projets devant être réalisés dans les limites du Canada ou du territoire domanial ne débordent pas ces limites;
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(d) to ensure that there be opportunities for timely and meaningful public participation throughout the environmental assessment process.
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d) de veiller à ce que le public ait la possibilité de participer de façon significative et en temps opportun au processus de l'évaluation environnementale.
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[64] The Minister's decision to refer the Belledune HTTO facility to a review panel was intended to be an exercise of the Minister's statutory authority under subsection 46(1) and subsection 48(1) of the CEAA. The key parts of those provisions read as follows:
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46. (1) Where no power, duty or function referred to in section 5 is to be exercised or performed by a federal authority in relation to a project that is to be carried out in a province and the Minister is of the opinion that the project may cause significant adverse environmental effects in another province, the Minister may refer the project to a mediator or a review panel in accordance with section 29 for an assessment of the environmental effects of the project in that other province.
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46. (1) S'il est d'avis qu'un projet qui doit être mis en oeuvre dans une province et à l'égard duquel aucune des attributions visées à l'article 5 ne doit être exercée par une autorité fédérale peut entraîner des effets environnementaux négatifs importants dans une autre province, le ministre peut, conformément à l'article 29, renvoyer à un médiateur ou à une commission l'évaluation de ces effets dans cette autre province.
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[...]
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[...]
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48. (1) Where no power, duty or function referred to in section 5 is to be exercised or performed by a federal authority in relation to a project that is to be carried out in Canada and the Minister is of the opinion that the project may cause significant adverse environmental effects on
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48. (1) Le ministre peut renvoyer à un médiateur ou à une commission l'évaluation des effets environnementaux d'un projet à l'égard duquel aucune attribution visée à l'article 5 ne doit être exercée par une autorité fédérale, si le projet doit être mis en oeuvre au Canada et peut, à son avis, entraîner des effets environnementaux négatifs importants sur_:
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(a) lands in a reserve that is set apart for the use and benefit of a band and that is subject to the Indian Act,
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a) des terres d'une réserve mise de côté à l'usage et au profit d'une bande et assujettie à la Loi sur les Indiens;
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(a.1) a park or park reserve as defined in subsection 2(1) of the Canada National Parks Act,
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a.1) un parc ou une réserve, au sens du paragraphe 2(1) de la Loi sur les parcs nationaux du Canada;
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(b) federal lands other than those mentioned in paragraph (a) or (a.1),
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b) le territoire domanial, à l'exception des terres visées aux alinéas a) et a.1);
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(c) lands that are described in a land claims agreement referred to in section 35 of the Constitution Act, 1982 and that are prescribed,
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c) des terres visées dans un accord de revendications territoriales visé à l'article 35 de la Loi constitutionnelle de 1982 et désignées par règlement;
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(d) lands that have been set aside for the use and benefit of Indians pursuant to legislation that relates to the self-government of Indians and that are prescribed, or
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d) des terres, désignées par règlement, mises de côté à l'usage et au profit des Indiens conformément à une loi relative à l'autonomie gouvernementale des Indiens;
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(e) lands in respect of which Indians have interests,
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e) des terres sur lesquelles les Indiens ont des droits.
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the Minister may refer the project to a mediator or a review panel in accordance with section 29 for an assessment of the environmental effects of the project on those lands.
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[65] The word "project" is defined in subsections 2(1) and (3) of the CEAA. The relevant parts of those provisions read as follows:
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2. (1) In this Act, ...
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2. (1) Les définitions qui suivent s'appliquent à la présente loi. ...
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"project" means
(a) in relation to a physical work, any proposed construction, operation, modification, decommissioning, abandonment or other undertaking in relation to that physical work, or
(b) any proposed physical activity not relating to a physical work that is prescribed or is within a class of physical activities that is prescribed pursuant to regulations made under paragraph 59(b). [...]
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« _projet_ » Réalisation - y compris l'exploitation, la modification, la désaffectation ou la fermeture - d'un ouvrage ou proposition d'exercice d'une activité concrète, non liée à un ouvrage, désignée par règlement ou faisant partie d'une catégorie d'activités concrètes désignée par règlement aux termes de l'alinéa 59b). [...]
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(3) For greater certainty, any construction, operation, modification, decommissioning, abandonment or other undertaking in relation to a physical work and any activity that is prescribed or is within a class of activities that is prescribed for the purposes of the definition "project" in subsection (1) is a project for at least so long as, in relation to it, a person or body referred to in subsection 5(1) or (2), 8(1), 9(2), 9.1(2), 10(1) or 10.1(2) is considering, but has not yet taken, an action referred to in those subsections.
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(3) Il est entendu que la réalisation - y compris l'exploitation, la modification, la désaffectation ou la fermeture - d'un ouvrage, ou l'exercice d'une activité désignée par règlement ou faisant partie d'une catégorie d'activités désignée par règlement pour l'application de la définition de « _projet_ » au paragraphe (1), constituent un projet, au minimum, tant qu'une personne ou un organisme visés aux paragraphes 5(1) ou (2), 8(1), 9(2), 9.1(2), 10(1) ou 10.1(2) envisage mais n'a pas encore pris une mesure prévue à ces dispositions.
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[66] To understand the function of subsections 46(1) and 48(1) of the CEAA, it is helpful to understand the elements of the scheme of the CEAA that are most relevant to this case.
[67] Section 5 of the CEAA requires a federal environmental assessment for any project that is proposed by a federal authority, or that will employ certain federal resources (such as federal funding or federally controlled land), or that is subject to federal government regulation in whole or in part. The CEAA contains detailed requirements for an environmental assessment governed by section 5, with a number of different levels of review.
[68] The most extensive kind of review for a section 5 project is a reference by the Minister to a review panel pursuant to section 28 of the CEAA. Such a reference may be made if the Minister is of the opinion that, taking into account the implementation of appropriate mitigation measures, the project may cause significant adverse environmental effects. A section 5 project may also be referred to a review panel if the Minister is of the opinion that public concerns warrant a reference to a review panel. According to section 29 of the CEAA, when a "project" is referred to a review panel, what is actually referred is the environmental assessment relating to the project. In other words, the review panel undertakes the entire process of the environmental assessment.
[69] A review panel consists of a number of persons appointed by the Minister pursuant to section 33 of the CEAA. They must be unbiased and free from any conflict of interest relative to the project, and they must have knowledge or experience relevant to the anticipated environmental effects of the project.
[70] These proceedings have been conducted on the basis that the Belledune HTTO facility is not within the scope of section 5 of the CEAA. However, that does not mean that the CEAA can have no application. Subsections 46(1) and 48(1) of the CEAA authorize the Minister, in certain circumstances, to refer a project to a review panel, even though the project is not within the scope of section 5. Subsection 46(1) may apply if the project has certain environmental effects in another province. Subsection 48(1) may apply if the project has certain environmental effects on land under federal control, including lands in which Indians have an interest or that is the subject of a land claims agreement.
[71] The Minister is not permitted to refer a project to a review panel under subsection 46(1) or subsection 48(1) of the CEAA if agreements are in place that deal with specified issues. Subsection 46(2) says that a referral cannot be made under subsection 46(1) if there is such an agreement between the Minister and the interested province or provinces (an interested province is the province where the project is located, and any province that may suffer adverse environmental effects from the province). Subsection 48(3) says that a referral cannot be made under subsection 48(1) in relation to lands in which Indians have interests if there is such an agreement between the Minister, the relevant authorities of any interested provinces, and the organization that represents the Indians with respect to their interest in the land. In this case, it is not suggested that there is any agreement that would preclude the Minister from making a referral to a review panel.
[72] Subsection 46(1) and subsection 48(1) of the CEAA may be invoked in a number of ways, but in this case they were invoked by letters sent to the Minister in October of 2003, which the Minister accepted as petitions pursuant to paragraph 46(3)(b) and 48(4)(b). The petitions alleged that the Belledune HTTO facility might have adverse environmental effects in Québec, and on certain Indian reserves in New Brunswick and Québec as well as areas of land and water upon which the people of those reserves rely for at least part of their livelihood. It is not suggested that the Minister erred in treating the October, 2003, letters as petitions.
[73] Pursuant to subsection 46(4) and subsection 48(5) of the CEAA, the Minister must give at least ten days notice of his intention to refer a project to a review panel under subsection 46(1) or subsection 48(1), respectively. The notice must be given to the proponent of the project, the governments of the interested provinces, to any person who signed a petition under subsection 46(3) or subsection 48(4) and, in the case of an intention to make a referral under subsection 48(1) in relation to lands in which Indians have interest, to the organization that represents the Indians with respect to their interest in the land. It has not been suggested that the Minister failed to give the statutory notice.
Was the Belledune facility a "project' when it was referred to a review panel?
[74] The parties agree on the general principle that something is not a project within the statutory definition unless it is in the proposal stage. However, they do not agree on how to apply that general principle in this case.
[75] Bennett argues that, by the time the Minister made the decision to refer the Belledune HTTO facility to a review panel, it was not a project within statutory definition because its construction was substantially complete and the issuance of an Approval to Operate was close at hand. The Crown argues that, because the Belledune HTTO facility had not started to operate when the Minister made his decision, the "proposed operation" of the Belledune HTTO facility, as separate from the building of the facility, was at that time a "project" within the statutory definition.
[76] On this point, the Judge agreed with Bennett and not the Crown. In my view, the Judge reached the correct conclusion.
[77] The ordinary and grammatical meaning of the statutory definition of "project" is consistent with the Crown's position that any proposed construction of a physical work, any proposed operation of a physical work, any proposed modification of a physical work, any proposed decommissioning of a physical work, and any proposed abandonment of a physical work, may be a "project". Something is a "project" only while it is in the proposal stage.
[78] There may be situations where the proposed operation of a fully constructed physical work is a "project" within the statutory definition. If, for example, a waste disposal company purchased an existing incinerator that had been used to dispose of waste products from a sawmill, and proposed to use that incinerator to dispose of waste products from a chemical manufacturer, the proposed change of use of the incinerator probably would be a "project" within the statutory definition. However, that does not mean that every newly built facility must necessarily be a "project" until it actually commences operations. Where approval is given to build something that is designed to operate for a specific purpose, the approval normally will contemplate both the construction and the operation. In such a case, the proposal phase will certainly have ended by the time the building is complete.
[79] The point is illustrated in Inter-Church Uranium Committee Educational Co-operative v. Canada (Atomic Energy Control Board) (F.C.A.), [2005] 1 F.C.R. 372. That case involved a uranium mine in which the federal regulatory approval regime contemplated a separate approval process for various stages in the development and the operation of the mine. Paragraph 47 of that case reads as follows:
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That does not mean that the end of the work of the Panel means an end to all environmental review for the McClean Lake Project. Environmental issues must be considered for each licence issued under the Uranium and Thorium Mining Regulations and their successor, the Uranium Mines and Mills Regulations. In addition, the CEAA environmental screening and assessment process may be triggered in future if subsection 74(3) of the CEAA applies. That would be the case if, for example, there is a proposal to undertake some activity relating to the McClean Lake Project that was not within the Panel's terms of reference (such as the increase in production proposed and permitted by the Commission in 2001, which had not been considered by the Panel established under the Guidelines).
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Thus, in principle, a new environmental assessment process would be required for a proposed activity for the uranium mine only to the extent that the proposed activity had not already been the subject of an environmental review.
[80] In determining whether the proposed operation of a particular facility is a "project" for the purposes of the CEAA, it is necessary to consider all of the relevant facts and circumstances, bearing in mind that Parliament deliberately aimed the CEAA at proposed activities of specified kinds, not at every possible activity that may be undertaken by anyone, at any time.
[81] In my view, the reason for that particular focus of the CEAA is to ensure that the potential environmental effects of an activity are assessed in the planning stage. This reflects a public policy that favours an environmental assessment regime that is both effective and efficient, and that respects the need for fairness to proponents of projects.
[82] If a project is too dangerous to proceed, it makes sense to have a mechanism in place to stop it reasonably early in the planning stages, and so avoid not only unacceptable environmental damage but also the unnecessary waste of the proponent's investment. On the other hand, if a project entails an environmental risk that can be reduced to an acceptable level with mitigation measures, a mechanism for an early environmental assessment ensures that those mitigation measures can be identified, assessed and imposed at the planning stage, again avoiding unnecessary waste. Also, focussing on environmentally sensitive activities at the proposal stage brings a degree of finality to the environmental assessment process and avoids the unfairness of retroactively imposing environmental standards.
[83] All of this is well explained by Linden J.A. in Tsawwassen Indian Band (Council) v. Canada (Minister of Finance) (2001), 201 F.T.R. 137, 270 N.R. 145, 37 C.E.L.R. (N.S.) 182 (F.C.A.), at paragraphs 11, 12 and 13:
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[11] . . . The CEAA attempts to obviate potential negative environmental effects of projects in which the federal government becomes involved in order to ensure that sustainable development is achieved. The responsible authorities are required to decide whether a project should proceed and, if so, with what mitigating measures. Once a project is approved and construction is legally begun, that approval cannot be reopened. This does not mean that responsible authorities are not allowed to supervise projects after construction begins and even after the work is completed. They do. They must ensure that any conditions of approval are met and that any mitigating measure are instituted. The definition of "project" in the Act, however, makes it clear that environmental assessments must be done only of proposed construction which is still in the planning stages.
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[12] It should be noted that the Shorter Oxford English Dictionary defines the words "to propose" as follows:
- to put forward for consideration ...
- to put forward for acceptance
- to lay before another ... something which one offers to do or wishes to be done.
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[13] For Parliament to have enacted otherwise would be unfair to those who are responsible for building projects, as these projects could be halted or changed at any time during the construction process and, possibly, even afterwards. Parliament ensured that there would be some finality to the assessment process by defining "project" as it did. Retroactivity was to be avoided.
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[84] The position of the Crown is that the "project" that the Minister referred to the review panel was not the "proposed construction" of the Belledune HTTO facility, but rather the "proposed operation" of the Belledune HTTO facility. That argument cannot prevail on these facts.
[85] Although the Approval to Operate had not yet been issued when the Minister made the decision to refer the Belledune HTTO facility to a review panel (and has still not been issued), the process of obtaining that approval had advanced nearly to its conclusion. The planning stage of the operation of the facility was substantially complete. More importantly, however, the environmental assessment process conducted by the provincial officials assumed an inextricable link between the operation of the Belledune HTTO facility and its construction. That is demonstrated by the fact that the Belledune HTTO facility is designed and built specifically for its intended use, and from the substantial parallels between the conditions of the Approval to Construct and the conditions in the draft Approval to Operate.
[86] I do not accept the submission of Bennett that the granting of the Approval to Operate is a foregone conclusion. No doubt Bennett is very confident that it will receive its Approval to Operate once the test burns are complete. However, there is no basis for concluding that the Approval to Operate will automatically follow the test burns. Nevertheless, given the particular history of the environmental approval process undertaken by provincial officials, the fact that an Approval to Operate has not yet been granted cannot justify the Minister in treating the "proposed operation" of the Belledune HTTO facility as though it were something new and different from its construction.
[87] The Crown also cites subsection 2(3) of the CEAA in support of its interpretation of the definition of "project". In my view, that provision does not help the Crown's position. It has no application to this case. It applies only to an undertaking that is under federal jurisdiction or that involves one or more federal approvals. No such federal approval is required for the Belledune HTTO facility.
[88] The interveners argued, among other things, that to find that the Minister is precluded from referring the Belledune HTTO facility to a review panel would render useless the right under paragraph 46(3)(b) or paragraph 48(4)(b) of the CEAA to submit a petition to the Minister to compel him to consider making a referral to a review panel. They point out that there is no time limit within which a petition may be submitted. It is true that a petition under either of those provisions may be submitted at any time. However, it does not follow that the Minister's authority to make a referral is thereby expanded to permit him to make a referral to a review panel of something that is outside the statutory definition of "project".
[89] In my view, the time for the Minister to exercise his authority under subsections 46(1) and 48(1) of the CEAA in respect of both the proposed construction and the proposed operation of the Belledune HTTO facility had expired by June 14, 2004. It follows that the Judge was correct to quash the Minister's decision.
The second ground of appeal: the prohibition order against the Agency
[90] The Crown made a second argument relating to the terms of the Order, which is quoted above. I reproduce it here for ease of reference. The underlined words related to the Crown's second argument:
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THIS COURT grants judicial review, quashes the said decision, declares it null and void and prohibits the Canadian Environmental Assessment Agency from proceeding with a review of the matter, the whole with costs against the respondents. There shall be no order as to costs with respect to the interveners.
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[91] The Minister's decision was to refer the Belledune HTTO facility to a review panel, not the Canadian Environmental Assessment Agency. The Agency does not undertake environmental reviews of the kind that are taken by a review panel.
[92] The Crown submits that the underlined portion of the Order was intended to give effect to the conclusion, stated at paragraph 22 of his reasons, that the CEAA did not authorize the Minister to review the Belledune HTTO facility to a review panel, and therefore the review panel cannot proceed. If that was the intent of that part of the Order, then I agree with the Crown it should not have been made. The Judge should not have prohibited the Agency from "proceeding with the review" because it is not the Agency that conducts the kind of review contemplated by the Minister's decision. Rather, according to section 33 of the CEAA, the review would be conducted by members of a review panel to be appointed by the Minister.
[93] It is possible that this part of the Order was intended only to stop the Agency from taking further steps to facilitate compliance with the Minister's decision to refer the Belledune HTTO facility to a review panel. If so, it was not necessary. Quashing the Minister's decision should automatically have stopped any such work.
[94] I conclude that the appeal should be allowed in part, to set aside the portion of the Order that refers to the Canadian Environmental Assessment Agency.
Reasonableness of the Minister's decision
[95] Although it is not strictly necessary to do so, I will comment on the argument of Bennett that even if the Minister was authorized to refer the Belledune HTTO facility to a review panel, his decision to do so was unreasonable.
[96] The test to be applied in determining whether a decision is unreasonable is explained as follows in Law Society of New Brunswick v. Ryan, [2003] 1 S.C.R. 247, per Iacobucci J., writing for the Court at paragraph 49:
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. . . [The ] reasonableness standard requires a reviewing court to stay close to the reasons given by the tribunal and "look to see" whether any of those reasons adequately support the decision. Curial deference involves respectful attention, though not submission, to those reasons.
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[97] In this case, the only reasons offered for the Minister's decision are those set out in the May 21, 2004, press release issued by the Agency. There is no choice but to assume that the statements in the press release represent the reasons for the Minister's decision. The relevant part of that press release is quoted above. I reproduce it here for ease of reference:
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Although federal experts are of the opinion that the project is not likely to cause significant adverse transboundary environmental effects, the Minister decided that further assessment is needed because Health Canada is of the view that data are too limited to state with absolute confidence that there are no human health concerns for transboundary communities.
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[98] I interpret this statement as an indication that the Minister made the decision he did because, and only because, Health Canada believed it did not have enough information to determine with absolute confidence that there would be no human health risks from the operation of the Belledune HTTO facility.
[99] Counsel for Bennett submits, correctly, that it can never be determined, with absolute confidence, that there is no human health concern from the release of a substance into the environment as a result of oxidation or combustion. If the Minister had decided that the Belledune HTTO facility cannot possibly proceed unless this standard is met, the decision might well have been found to be unreasonable.
[100] However, the decision made by the Minister was only to refer the Belledune HTTO facility to a review panel. The purpose of that referral, in general terms, is to have the review panel gather and assess relevant information to determine whether and to what extent the operation of the project might affect human health in Quebec and on nearby Indian reserves, and if there are potential health risks in those areas, to determine how the project might be operated to mitigate those risks. The Minister might have reasoned, as Bennett has done, that the existing information is sufficient to conclude that the potential health risks are negligible close to the facility, and so logically would be even less further away from the facility. However, I cannot say that it was unreasonable for the Minister not to adopt that reasoning.
[101] Nor can I accept the argument of Bennett that the decision of the Minister to refer the Belledune HTTO facility was improperly influenced by partisan politics. The press release announcing the Minister's intention to make the referral was issued two days before the announcement of the date of the next federal election, but some days after the Minister had received the May 17, 2004 report of the Agency. It is not unreasonable to infer that Minister wished to move as quickly as possible after receiving the Agency's report, considering that over six months had already passed since the receipt of the petitions in October of 2003.
General comments on the fairness of the procedure followed by the Minister
[102] I wish to make two observations about the procedure followed by the Minister in responding to the petitions, in the hope that they will prove helpful in future cases.
[103] First, the Minister should not have acted on the petitions without giving Bennett an opportunity to respond to the specific factual allegations and arguments in the petitions.
[104] Second, the Minister should have given Bennett an opportunity to address the questions identified by Health Canada in its February 2, 2004, letter. The CEAA requires the Minister to give at least 10 days notice to the proponent, the interested provinces, and the petitioner, of his intention to refer a project to a review panel. That notice would serve no useful purpose unless it gives the proponent and the other notified parties a reasonable opportunity to provide further information, if they wish, before the Minister makes a referral decision. In this case, Bennett made a timely request for an opportunity to provide further information, but its request apparently was ignored.
Conclusion
[105] I would allow the appeal in part, leaving in place the portion of the Order that quashed the Minister's decision to refer the Belledune HTTO facility to a review panel, but deleting the portion that prohibits the Canadian Environmental Assessment Agency from proceeding with a review.
[106] Although the appeal was partly successful, Bennett has succeeded on its principal point and should be entitled to costs.
[107] Bennett seeks the costs of this appeal on a solicitor and client basis. The record discloses no conduct on the part of the Minister or counsel for the Minister that would justify such an order. Bennett asks in the alternative for an order for costs on the basis of Column V for two counsel. That would reflect a relatively modest increase in the standard tariff (Column III). I would accede to that request because this appeal involves questions of statutory interpretation that are more difficult than most, and that are being considered for the first time in this Court.
[108] No order of costs should be made for or against the interveners.
(s) "K. Sharlow"
J.A.
"I agree.
A.M. Linden J.A."
"I agree.
J. Edgar Sexton J.A."
FEDERAL COURT OF APPEAL
NAMES OF COUNSEL AND SOLICITORS OF RECORD
DOCKET: A-509-04
STYLE OF CAUSE: MINISTER OF THE ENVIRONMENT and the
CANADIAN ENVIRONMENTAL ASSESSMENT
AGENCY and BENNETT ENVIRONMENTAL INC.
and EEL RIVER FIRST NATION, PABINEAU FIRST
NATION, MICMAC OF GESGAPEGIAG, LISTUGUJ
MICMAC GOVERNMENT AND THE BELLEDUNE
CITIZENS COMMITTEE
PLACE OF HEARING: Toronto, Ontario
DATE OF HEARING: June 2, 2005
REASONS FOR JUDGMENT : SHARLOW J.A.
CONCURRED IN BY: LINDEN, J.A.
SEXTON, J.A.
DATED: July 19, 2005
APPEARANCES:
Brian R. Evernden For the Appellants
Andrew J. Roman For the Respondent
Erin M. Tully
Eric K. Gillespie For the Interveners
SOLICITORS OF RECORD:
John H. Sims, Q.C. For the Appellants
Deputy Attorney General
of Canada
MILLER THOMSON LLP For the Respondent
Barristers & Solicitors
Toronto, ON
CUNNINGHAM For the Interveners
& GILLESPIE LLP
Barristers & Solicitors
Toronto, ON
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