On Friday, December 6, 2019, the Supreme Court of Canada is releasing its decision in Resolute FP v. Ontario (Attorney General). At issue is whether an environmental remediation indemnity agreement made in 1985 is broad enough to require the province to pay the cost of compliance with a regulatory order made in 2011. In other words, is a company that bought the contaminated land responsible for paying for remediation or does it fall to the public purse?
In the 1960s, Dryden Paper Company operated a pulp and paper mill that released mercury waste into the English and Wabigoon Rivers. Grassy Narrows and Islington First Nations commenced lawsuits in the 1970s which were eventually settled in 1985. As part of the settlement, Ontario gave an indemnity to a previous owner of the site, Reed Ltd, and the company that brought the site from them, Great Lakes Forest Products Ltd. Fast forward to 2011 where the Ontario Ministry of the Environment issued a Director’s Order requiring later owners, Weyerhaeuser and Resolute, to perform remedial work at the waste disposal site. The companies took the position they enjoyed the benefit of the 1985 indemnity provided by Ontario. As a result, they contended Ontario was obligated to indemnify them for any costs incurred to comply with the Director’s Order. Ontario took the position the indemnity only covered third party claims resulting from mercury spills emanating from the property and not the regulatory compliance costs incurred by the owners of the waste disposal site.
The motion judge granted summary judgment in favour of Weyerhaeuser and Resolute, holding both were entitled to be indemnified by Ontario for expenses as a result of the Director’s Order. The Court of Appeal allowed Ontario’s appeal against Resolute and partially allowed it against Weyerhaeuser. However, the majority of the Court of Appeal upheld the motion judge’s finding that the 1985 indemnity covers the cost of complying with the Director’s Order. Justice Laskin, in dissent, sided with Ontario and found the 1985 indemnity was not intended to respond to first party claims such as the Director’s Order.
At the SCC, the Court treated it as three appeals with Resolute, Weyerhaeuser, and Ontario being both appellants and respondents. This is one of the most complex appeals of the year in terms of trying to predict. Make your prediction now.