Quarries and Environmental Assessment: Is the trigger proposed production capacity or actual production capacity? (republished)

November 1, 2012

This article was originally posted in Eco-Bulletin, the newsletter of the Canadian Bar Association’s National Environmental, Energy and Resources Law Section, in November, 2012.

By Shane Hopkins-Utter

On June 29, 2012, the B.C. Court of Appeal rendered a unanimous judgment in Friends of Davie Bay v. Province of British Columbia, 2012 BCCA 293. I believe that it is an important decision because it confirms that environmental assessment (EA) triggers are to be interpreted on the basis of the project as proposed, not on the basis of the potential for higher production levels down the road. This allows the British Columbia (“BC”) Environmental Assessment Office (“EAO”) to focus on proposals for large-scale projects rather than exploring hypothetical scenarios for smaller projects that might, one day, seek to increase production, at which point other regulatory safeguards would in any event be engaged.

Lehigh Hanson Materials Ltd. made a proposal to build and operate a limestone quarry in the area of Davie Bay, Texada Island, B.C. The quarry’s proposed production capacity was 240,000 tonnes per year. This was 10,000 tonnes below the threshold at which the Reviewable Projects Regulation requires an environmental assessment to be carried out. The EAO reviewed the proposal, decided there was no EA trigger, and advised the Minister against exercising his discretionary power – granted by statute – to order that an assessment be carried out anyway.

The Friends of Davie Bay, an NGO dedicated to conserving and protecting the environment in the Davie Bay area, applied for judicial review of the EAO’s finding that in this case, production capacity did not trigger an environmental assessment. The Supreme Court ruled that the standard of review is reasonableness because the matter related to the interpretation of the enabling statute or “home statute” of the administrative body. It then found that the EAO’s reading of the statute was not unreasonable. At the Court of Appeal, Friends of Davie Bay argued that the applicable standard should be the less deferential standard of correctness and they sought an order declaring that Part 3, Table 6 of the Reviewable Projects Regulation requires an EA when the infrastructure investment, equipment, operational plan and size of a proposed quarry and its reserves indicate that the project will have an actual production capacity exceeding 250,000 tonnes per year.

The Court of Appeal confirmed that the standard for review is reasonableness. It then acknowledged the possibility that in a “proponent-centred, self-monitoring” regulatory compliance system, a proponent could, conceivably, overbuild its infrastructure and equipment to allow for future expansion, to levels of production well beyond the regulatory threshold that triggers the requirement for an EA. However, Madam Justice Bennett, writing for the court, observed there are a number of safeguards that fill this perceived loophole. For instance, the minister may order an EA even when the regulatory threshold is not reached. Furthermore, the proponent must comply with its permits, and the regulator monitors compliance; exceeding production capacity limits would result in sanctions under the applicable regulations. The Court of Appeal rejected the Friends of Davie Bay’s argument that the law requires EAO to determine the maximum production capacity of every proposed project when considering whether an EA obligation is triggered. Madam Justice Bennett found that this would be “impractical and inconsistent with the means through which the legislation contemplates achieving its object.” She recognized that by “designing a proponent-driven assessment at the front end of the environmental regulatory process, the Legislature balanced the need to conduct environmental assessments in warranted circumstances against the existence of other safeguards, the impracticality of assessing every project as a matter of course, and the interests of economic development in British Columbia.”

The B.C. Court of Appeal has reminded us that the regulator oversees projects from beginning to end. EAs are no substitute for permitting and inspections. By applying the law as written and refusing to read in implied obligations, the Court has upheld the division of powers and made it clear that no single statutory safeguard is intended to ensure that all environmental protection objectives are met.

(c) Shane R. Hopkins-Utter 2012, 2016

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