The Supreme Court of Canada rendered its decision in St. Lawrence Cement Inc. v. Barrette on Thursday, November 20, 2008. In this case, some residents of the city of Beauport, Québec instituted a class action against St. Lawrence Cement ("SLC") for neighbourhood disturbances related to the operation of the plant. The class members were complaining about the consequences of the plant’s activities. They complained about the odours, the noise, and the dust emitted by the plant. The evidence showed that SLC spent several million dollars with respect to the protection of the environment and the instalment of dust collectors.
At the trial level, the Superior Court of Québec concluded that the class members had suffered abnormal annoyances with respect to the SLC plant. The Court recognized SLC’s liability without finding fault. By doing so, the Court acknowledged the existence of a no-fault liability regime with respect to neighbourhood disturbances under section 976 of the Civil Code of Québec. The Court ordered SLC to pay damages with respect to those disturbances. The Québec Court of Appeal upheld the ruling that SLC was to pay damages, based on a different reasoning, but reduced the amount awarded to the group members. The Court of Appeal rejected the no-fault liability regime but nevertheless concluded that SLC was liable based on proven fault. The Court considered that SLC had the obligation, with respect to an environmental regulation, to "properly maintain its equipment and to ensure that it was functioning optimally during production hours." The Court of Appeal found that SLC had to be able to stop its operation as soon as a breakdown occurred and for as long as it took to repair. The Court of Appeal concluded that SLC had failed to do so on numerous occasions.
The Supreme Court preferred the reasoning of the Superior Court to that of the Court of Appeal. The Court chose to recognize the existence of a no-fault liability regime in the Civil Code of Québec with respect to neighbourhood disturbances (art. 976 C.C.Q.). The Court came to this conclusion after, among other things, comparing Canadian common law and French civil law. In the opinion of the Court, "in both these legal systems, a scheme of no-fault liability in respect of neighbourhood disturbances is accepted in one form or another." Under the no-fault liability regime in the Civil Code of Québec, damages can be granted even if no objective fault is committed, i.e. "even when the defendant is complying with the law so long as the activities caused abnormal annoyances that were beyond the limit of tolerance neighbours owe each other." Consequently, the impact resulting from particular conduct rather than the conduct itself has to be considered. The Supreme Court re-established the damages granted by the Superior Court and ordered SLC to pay damages to the class members.
As the Supreme Court recognized that nuisance in the common law has some shared characteristics with the nofault liability regime under article 976 of the C.C.Q., the SLC judgment might also have impact outside of Québec. In light of all these comments, companies should be careful to ensure that their activities are not causing any abnormal annoyances to their surrounding neighbourhood, even when they are in compliance with the law.