Enviro
Notes!
Environmental Law Practice Group News Environmental Solutions for Business February 13, 2002
ONTARIO MAKES SIGNIFICANT CHANGES TO
HAZARDOUS WASTE MANAGEMENT REGULATION
The Ontario Ministry of the Environment (MOE) has made significant amendments to the legal requirements for the management of hazardous and liquid industrial wastes. The amendments to Regulation 347, which came into force on January 1, 2002, make the first major changes to the generator registration and manifest systems since the hazardous waste tracking system was created in 1985. The Minister’s Requirement for Hazardous Waste Fees for the first time imposes user pay requirements on Ontario generators.
Since 1985, generators of hazardous and liquid industrial waste have been required to register with the MOE. Until January 1, 2002, registration was a one-time requirement, subject to an ongoing obligation to register changes. Generator registration has until now been a manual system. A newly-registered waste stream could not be shipped until the MOE acknowledged the registration and assigned a generator number, a process that has typically taken up to six weeks.
The amendments require annual registration by all generators on or before February 15th of each year. While it remains possible to register manually, the MOE has now launched HWIN, the Hazardous Waste Information Network, which allows for electronic registration. Rather than relying on mailed confirmation, a generator registration will now be acknowledged by posting on a new MOE web site (www.hwin.ca). Registration time has been reduced to 30 minutes.
The MOE has written to all registered generators to advise them of their assigned User ID and password for using the new system. Carriers and receivers have also been requested to voluntarily register with HWIN.
Manifests Manifests
The waste manifest system will continue to function as a paper-based system. Beginning on February 26, 2002, the capabilities of HWIN will be expanded to enable electronic manifesting. A number of amendments have been made to the manifest provisions of Regulation 347 to allow for electronic manifests. Unlike the paper system, which is initiated by the carrier, an electronic manifest will be initiated by the generator, who will give the carrier electronic access. New Section 20.1 prohibits any carrier from taking possession of waste unless the generator’s registration for it is posted on the Ministry’s web site. While theoretically in force now, this provision is unlikely to be enforced until the initial round of electronic registration is complete.
Fees
In conjunction with the Regulation 347 amendments, Minister Witmer has signed a Minister’s Requirement for Hazardous Waste Fees. The new fees are intended to recover the Ministry’s costs for managing hazardous and liquid industrial waste.
Generators will be required to pay $50.00 annually, plus $5.00 per manifest used, plus $10.00 per tonne of hazardous waste generated. The per tonne charge will not apply in respect of waste recycled at a recycling facility specified on the MOE web site.
Only the $50.00 fee is payable at the time of registration. Fees related to manifests and tonnage are due in advance, subject to year-end accounting. This year the first advance payment is not due until March 15th. The MOE’s letter to generators contains an estimate of that fee, based on historic data. The MOE concedes that the mailed estimates may, in many cases, be totally inaccurate. Ultimately, the HWIN system operates on the basis that each generator will have an account with MOE. Sufficient funds will have to be in the account before a generator will be allowed to ship waste.
There are a number of wastes that have always been considered to be registerable, even though they never left the generator’s site. Many of these waste streams may never have been registered, however, since there was never any need to manifest them. The Minister’s Requirement imposes a tonnage fee on those waste streams, which include wastes disposed of at on-site waste management facilities and combustion facilities, such as boilers. Tonnage fees will also apply to hazardous wastes discharged to a municipal sanitary sewer.
The changes to Regulation 347 are only part of the MOE’s overall plan to handle the disposal and elimination of hazardous wastes. The notice and comment phase is currently in progress for a number of other initiatives, including the destruction of all PCB wastes currently in storage in Ontario, the phasing out of hospital incinerators and the implementation of hazardous waste land disposal restrictions.
John Tidball, Co-Chair, National Environmental Law Group
Markham, 905.415.6710
[email protected]
DRAFT ADMINISTRATIVE MONETARY PENALTY
REGULATIONS
RELEASED IN ONTARIO
On January 16, the Ontario Ministry of the Environment (“MOE”) released for public comment draft regulations intended to implement the MOE’s new administrative monetary penalty (“AMPs”) regime.
In February 1999, Bill 82 came into force, amending Ontario’s three environmental statutes (the Environmental Protection Act, the Ontario Water Resources Act and the Pesticides Act) (the
“Acts”). Bill 82 provided the legislative framework for the province to implement AMPs at a later date by regulation.
Once in force, AMPs will be applied to companies and individuals when the MOE forms the “opinion” that there has been:
a contravention of any one of a number of statutory duties (specified in the draft regulations);
a failure to comply with a MOE order; or,
a failure to comply with a term or condition of a certificate of approval.
The MOE will rely on its wide powers of inspection to detect contraventions enforceable through AMPs. When an inspection reveals such a contravention, the draft regulations require, with some limited exceptions, that the MOE provide the offender with advance written notice of its intention to issue the AMP, including the amount of the proposed penalty to a maximum of $10,000 per contravention for each day or part thereof the contravention has continued. The draft regulations prescribe a base penalty for each contravention which must be increased if the offender has previous AMPs or convictions under the Acts. The offender will have fifteen days to offer submissions to the MOE to seek a reduction of the proposed penalty. The size of the proposed AMP can be reduced if the MOE is satisfied:
the contravention occurred despite the “reasonable care” of the offender;
the offender took all reasonable steps to mitigate the effects of the contravention; and/or,
the offender entered into and complied with a consent order to remedy the contravention
AMPs may be issued within a two year limitation period. Offenders will have the right to appeal within fifteen days of receiving written notice of the AMP (not to be confused with the advance notice) to the Environmental Review Tribunal. The Tribunal can confirm, rescind or amend the notice but cannot vary the size of the penalty unless it considers the amount unreasonable. If a party fails to pay the AMP, it can be prosecuted for the contravention triggering the imposition of the AMP. Moreover, the MOE may file an unpaid AMP with the courts for collection like a civil judgment, or suspend or refuse to issue certificates of approval, licenses or permits until the AMP is paid.
AMPs have been common place in the United States for many years, and similar provisions have been enacted in other Canadian jurisdictions including British Columbia, Alberta and New Brunswick. AMPs can be an efficient, cost effective method for promoting compliance with the environmental statutes. Unlike the lengthy investigations and court processes associated with the prosecutions, AMPs can provide a quick response to instances of non-compliance.
We are concerned that the draft regulations may not strike the right balance between the laudable objective of effective enforcement and fairness to those persons regulated by the environmental statutes. First and foremost, arguably the draft regulations threaten the historical
role of the defence of reasonable care (or due diligence) in environmental regulation in Ontario. Generally, the prosecution of environmental offences calls for the (almost) full application of all legal rights available to the accused as found in the Charter of Rights and Freedoms (the “Charter”). More generically known as strict liability offences, environmental offences require proof not only of the wrongful act, but also an element of fault in the form of a presumption of negligence, rebuttable by the defendant if it establishes the defence of reasonable care (i.e. due diligence). The draft regulations, however, do not specify reasonable care as a defence to an AMP; rather, reasonable care is a factor to be considered in mitigating the size of the AMP. The MOE views AMPs as civil, and not penal in nature, meaning that in its view Charter protections and rights should not be available to offenders dealt with by way of AMPs. On proof by a preponderance of evidence (not beyond a reasonable doubt) of the wrongful act by the offender, it should pay regardless of any concerns as to whether the subject was at fault.
The MOE justifies its intended exclusion of reasonable care as a defence on the basis that if it is treated instead, as a mitigating factor, it will “encourage regulated actors to engage in an open and constructive dialogue” with the MOE on how to fix that which caused the problem.
The availability of the reasonable care defence to AMP enforcement, in our view, will be litigated forcefully before the Tribunal. Although there is court authority from other jurisdictions supporting the MOE’s position that the defence is not applicable, there is also authority supporting the proposition that it should be available. Certainly, the policy behind the reasonable care defence is sound. From the MOE’s perspective, the reverse onus/rebuttable presumption inherent in the defence is sensitive to the difficulties that the MOE would face in proving the negligence (or the absence of reasonable care) of an accused in a prosecution. Practically, it also puts the ball into the regulated actor’s court to be constantly striving to meet, if not surpass, the standard of care expected of it in complying with environmental legislation. From the regulated’s perspective it provides some assurance that if the regulated meets its duty to exercise reasonable care in attempting to comply, it will not be exposed to the risk of enforcement proceedings through prosecution.
Another concern is the “opinion threshold” which must be met by the MOE before issuing an AMP notice. Opinion is a very low threshold, meaning that notices could be issued when there is little evidence of a breach, leading to unnecessary but costly proceedings before the Tribunal. Finally, a larger concern is more procedural. AMPs will be issued when a routine inspection, as opposed to an investigation, reveals information sufficient for the MOE to form the opinion that a breach has occurred. This situation could transform what historically has been a co-operative relationship between MOE inspectors and regulated actors into something much more adversarial. Given the potential exposure AMPs represent to companies and individuals, our view is that they should take immediate steps to put into place systems to monitor, and, within the law, manage the access of MOE inspectors to business property.
The draft regulations have been posted until April 16 on the Environmental Bill of Rights registry (www.ene.gov.on.ca/envision/env_reg/er/registry.htm). They could be promulgated, without major revision, soon after the public review period ends.
Bruce McMeekin Markham, 905.415.6791 [email protected]
For further information, please contact any one of the lawyers in the Environmental Law Group:
In Markham: In Vancouver: In Calgary:
Rod McLeod, Q.C. Tony Crossman Brian J. Evans, Q.C.
905.415.6707 604.643.1244 403.298.2454
[email protected] [email protected] [email protected] John L. Martin, P.Eng. Wendy A. Baker Wade D. Clark
905.415.6793 604.643.1281 403.298.2432
[email protected] [email protected] [email protected] John R. Tidball Caroline G. Hill Ian D. McKay
905.415.6710 604.643.1284 403.298.2422
[email protected] [email protected] [email protected] J. Bruce McMeekin Rosanne Kyle Craig J. Tomalty
905.415.6791 604.643.1235 403.298.2428
[email protected] [email protected] [email protected]
In Toronto: Erin M. Tully In Edmonton:
604.643.1279
Andrew J. Roman [email protected] Lorne A. Smart, Q.C.
416.595.8604 780.429.9728
[email protected] Katherine Xilinas [email protected] 604.643.1233
Franklin T. Richmond [email protected] Kent Davidson
416.595.8180 780.429.9790
[email protected] In Whitehorse: [email protected] Bryan J. Buttigieg Leigh F. Gower Mark Gollnick
416.595.8172 867.633.2088 780.429.9712
[email protected] [email protected] [email protected] Derek J. Ferris In Washington, D.C.: Our Consultants:
416.595.8619
[email protected] William E. Wickens Prof. Alastair R. Lucas
202.775.2400 403.220.7111
Tamara Farber [email protected] [email protected] 416.595.8520
[email protected] Joseph S. Hoover, Jr. Prof. David R. Percy
202.775.2400 780.429.9769
Stuart Rudner [email protected] [email protected] 416.595.8672
Note:
Miller Thomson LLP’s EnviroNotes! e-newsletter is provided as an information service to our clients and is a summary of current legal issues of concern to businesspersons and their advisors. These articles are not meant as legal opinions and readers are cautioned not to act on information provided in this newsletter without seeking specific legal advice with respect to their unique circumstances. Your comments and suggestions are most welcome and should be directed to: The Editor, EnviroNotes! at the Toronto office.
