Corporations operating plants, refineries and other facilities are forced to rethink and retool risk assessment strategies in the wake of the Supreme Court of Canada's decision in Ciment St. Laurent v. Barrette, which has confirmed the existence of a new form of no-fault liability in neighbourhood disturbance matters.
Initially authorized and subsequently filed in August of 1994 by 2,000 residents of Beauport, the class action garnered a great deal of attention from the industrial sector, and with good reason.
Since the cement plant first became operational in 1955, the ministère de l'Environnement was forced to step in on numerous occasions following complaints of dust, noise and odours by area residents. In the early 1990s, Ciment St. Laurent invested substantial amounts in environmental protection measures and finally agreed to wash homes and cars that had been affected by dust and debris from the plant, which ultimately closed its doors in 1997.
As originally determined by the first instance judge, Ciment St. Laurent was not found to be in breach on any relevant legislation and had fulfilled its obligations to filter dust and smoke to the best of its abilities, all while taking the necessary reasonable precautions to keep the plant functioning optimally.
It is for these reasons that the Supreme Court's decision has proven to be somewhat of an awakening for the Quebec legal community and even more so for corporations finding themselves uncertain as to how to adjust going forward.
Neighbourhood disturbances in Quebec have always been subject to the general rules of civil liability, whereby the party at fault may be called upon to repair the injury caused by said fault.
With this decision, the Supreme Court has confirmed that a second form of liability exists with respect to neighbourhood disturbances; one whereby liability is not based on fault but, rather, the excessiveness of the inconvenience suffered by the victim. Liability may thus be attributed without regard for the conduct of the responsible party, instead taking into consideration the degree of annoyance suffered by one's neighbour.
The result for Ciment St. Laurent was liability in excess $15,000,000, despite the fact that it had respected all of its obligations.
In an effort to curb the likelihood of a similar result, industry will now be forced to adapt to this new form of liability. Whereas statutory compliance was the rule in the past, companies must look beyond laws and regulations to those areas of their business most likely to evoke public protest. In this light, risk assessment and due diligence strategies, as well as environmental protection measures, must undoubtedly be reviewed and revised accordingly.
In short, awareness and adaptation will be key going forward. Corporations with plants, refineries and other susceptible operations must keep their ears to the ground and be prepared to take the necessary steps to avoid facing the consequences of this new form of no-fault liability for neighbourhood disturbances.