There is a trend in Alberta of increased environmental enforcement with significant penalties being imposed. Many of these cases proceed on the basis of a plea bargain arrangement where the offender pleads guilty and there is a joint submission with the Crown on the appropriate penalty. In such cases the court often accepts the joint submission and does not issue reasons explaining the principles applied when determining sentences for an environmental offense. It is important for business to keep those principles in mind when carrying out operations.

Earlier this year, we reported on the sentencing decision in R. v. Syncrude Canada Ltd. In that October 2010 decision the Court accepted the joint submission of Syncrude and the Crown which involved a combination of fines and additional penalties totalling $3,000,000 under the Alberta Environmental Protection and Enhancement Act and the federal Migratory Birds Convention Act. No reasons were provided, and the factors to be considered in determining the quantum of the fine were left unanalyzed by the Court.  

On April 15, 2011, Suncor Energy Inc. (Suncor) was convicted for contravening its Water Act approval for one of its oilsands sites north of Fort McMurray. Suncor failed to follow its water management plan, although, after being charged, Suncor took steps to follow a revised water management plan. The fine was set at $275,000, but no accompanying written decision was issued. This conviction is one of several recent convictions against Suncor for contraventions of Alberta and federal environmental legislation, including a $200,000 penalty in December 2010 for violations of the Fisheries Act. This sentence was also based on a plea bargain arrangement and no reasons were provided addressing the factors considered in sentencing.  

On February 11, 2011 the Alberta Provincial Court again imposed a significant penalty in the Jovnic case, but here the court addressed the factors to be considered in determining the size of an environmental fine.  

Jovnic Ltd. was charged pursuant to s. 142(2)(f) of the Water Act with knowingly authorizing the commencement or continuation of an activity without an approval or authorization under the Water Act. Jovnic pled guilty to the charges, but there was no agreement as to the appropriate fine. The maximum fine available for this offence is $1,000,000.

Jovnic’s property in Edmonton is bisected by an intermittently running creek, which ultimately flows to the North Saskatchewan River one kilometre from the property. In developing the property for industrial use, Jovnic removed topsoil and graded the area near the creek. Jovnic excavated a channel to allow for the installation of culverts, infill of wetlands and construction of two stormwater detention ponds. This work was all done to realign the creek. A public complaint to Alberta Environment was made and an investigation occurred.  

In establishing the amount of the fine the Court confirmed the intent is that the fine be substantial enough to act as a deterrent to others, but not be harsh. Also, the court should keep in mind the goal of environmental legislation, which is to protect the public through protection of the environment. The applicable principles in sentencing include both aggravating and mitigating factors:

  • protection of the public;
  • retribution or punishment;
  • rehabilitation and reform;
  • deterrence;
  • extent of potential and actual damage;
  • intent;
  • savings or gain derived from the offence;
  • the “worst case”;
  • size and wealth of the corporation;
  • contrition or remorse;
  • guilty plea;
  • co-operation and expenditures;
  • laxity of government agencies;
  • prior convictions; and
  • ease or difficulty in preventing pollution.

In terms of mitigating factors, the Court noted that Jovnic had entered its guilty plea very early, had cooperated with the investigation, provided payment of the fine in trust and complied with the enforcement order.

On the other hand, aggravating factors included Jovnic’s healthy finances; that the director and an employee of Jovnic were previously involved in an offence under the Water Act and “should have known better”; the significant degree of indifference shown by the director and employee to legal requirements of which they should have been aware; the creek and wetland having been destroyed creating the potential for damage downstream; and the high value of the property.

The Court ultimately issued a penalty of $200,000 against Jovnic, with a creative sentencing component that directs $180,000 of the penalty to fund research on lake sturgeon fish populations in the North Saskatchewan River, conducted by the University of Alberta, and the balance of the penalty to be paid as a fine.  

The recent increase in enforcement under the Water Act, Environmental Protection and Enhancement Act, Fisheries Act and other environmental legislation in Alberta is a reminder that those with approvals and licences issued under these statutes should ensure compliance with all accompanying conditions, and should take into consideration the foregoing sentencing principles. If non-compliance occurs significant penalties may result, especially where environmental damage is easily preventable.