Ontario Land Tribunal
Tribunal ontarien de l’aménagement du territoire
ISSUE DATE: September 02, 2021
CASE NO(S).: 11-144
PROCEEDING COMMENCED UNDER section 140(1) of the Environmental Protection Act, R.S.O. 1990, c. E.19
Appellant: See Appendix 1 - Appellant List (11-144)
Respondent: Director, Ministry of the Environment, Conservation and Parks
Subject of appeal: Order to carry out work and provide financial assurance with respect to the Margach Waste Disposal Site
Reference No.: 8301-8HFPUQ
Property Address/Description: Margach Waste Disposal Site
Municipality: City of Kenora
Upper Tier: Kenora District
OLT Case No.: 11-144
OLT Case Name: OfficeMax Incorporated v. Ontario (Environment, Conservation and Parks)
HEARD: July 6, 2021 by video hearing
APPEARANCES:
Parties
Counsel
AbiBow Canada Inc.
Tyson Dyck
AbitibiBowater Inc.
Abitibi-Consolidated Company of Canada
Allen Dea
Zachary Silver and Alexandria Pike
Alain Grandmont
William G. Harvey
David J. Paterson
Pierre Rougeau
Jacques P. Vachon
OfficeMax Incorporated
Jennifer Fairfax and Sadie-Rae Werner (summer student)
Director, Ministry of the Environment, Conservation and Parks
Nadine Harris, Justin Jacob, Verity Thomson (summer student), and Catalina Karam (summer student)
DECISION DELIVERED BY HUGH S. WILKINS AND ORDER OF THE TRIBUNAL
INTRODUCTION
1On August 16, 2011, the Director, Ministry of the Environment, Conservation and Parks (“MECP”), issued Director’s Order No. 8301-8HFPUQ regarding the Margach Waste Disposal Site (“waste disposal site” or “Margach waste disposal site”) located in the City of Kenora (“City”). The Director’s Order was appealed to the Environmental Review Tribunal (now the Ontario Land Tribunal) under s. 140(1) of the Environmental Protection Act. The Parties listed in Appendix 1 to this Decision are the appellants (“Appellants”).
2The waste disposal site contains non-hazardous industrial waste from a former pulp and paper mill. It was created in 1986 after the nearby Mud Lake waste disposal site, which had been used by the same pulp and paper mill, reached its maximum capacity. The Mud Lake waste disposal site is the subject of proceedings under Tribunal File No. 11-061. The Margach waste disposal site has not received any waste since 2009, but it has not been capped and closed.
3The Margach waste disposal site still has capacity to be operated as an active waste disposal site; however, if it is to be closed, an approved closure plan will be needed. The closure plan will need to require the installation of an impervious cover and continuing monitoring and maintenance to reduce leachate generation and prevent or reduce adverse effects on the environment.
4The Margach waste disposal site has been owned by various companies over the years. It is currently owned by 4513541 Canada Inc., which is an insolvent corporation with no shareholders, directors, officers or employees. The Appellants include AbiBow Canada Inc., AbitibiBowater Inc., and Abitibi-Consolidated Company of Canada, which are predecessor companies of Resolute Forest Products Inc. and Resolute FP Canada Inc. (“Resolute Canada”). They also include OfficeMax Incorporated. They are past owners or companies associated with the Margach waste disposal site. Six persons who were at one time board members of AbitibiBowater Inc. also appealed.
5The purpose of the Director’s Order is to require the preparation and implementation of a closure plan for the waste disposal site and prevent or reduce the amount of leachate generated that may discharge offsite and result in adverse effects. The Director’s Order requires additional financial assurance and maintenance, monitoring, and reporting work being done. This includes inspections and the implementation of surface water and groundwater monitoring programs. The Director’s Order specifically requires:
- no further waste to be deposited at the Margach waste disposal site;
- an application for approval for the site to include a closure plan and for the plan to be implemented;
- regular inspections and reporting to ensure that no further waste is deposited;
- a surface water monitoring program and reporting;
- a groundwater monitoring and reporting;
- regular inspections and reporting on the outlet from the waste disposal site’s engineered wetland;
- the correction of any malfunctions or deficiencies identified in the course of inspections; and,
- the submission of additional financial assurance in the amount of $2,300,000.00 for the closure of the waste disposal site and the submission of a financial assurance re-evaluation in respect of post-closure work at the site.
6In late 2011, the Tribunal stayed certain items in the Director’s Order, including on financial assurance, and approved an Interim Order pending the outcome or final resolution of the appeals. The Tribunal subsequently granted a series of adjournments to permit ongoing work at the waste disposal site while settlement discussions were held between the Parties. In January 2014, the Tribunal issued an Amended Interim Order to continue the stay of financial assurance requirements and make changes regarding work items. These include requirements for the submission of an annual monitoring report setting out the results of the surface water monitoring program, an inspection summary, and a summary of all complaints, responses and actions taken, and the updating of the surface water and groundwater monitoring programs on an interim basis.
7On May 7, 2021, the Tribunal held a Case Management Conference (“CMC”) in these proceedings. At the CMC, the Parties informed the Tribunal that they have reached a settlement in principle and requested the convening of a settlement hearing. At the CMC, the City requested, and was granted, Participant status.
8On July 6, 2021, the Tribunal held a settlement hearing to address the proposed settlement and to determine whether the Director’s Order should be revoked and the proceedings should be dismissed. The settlement hearing was held subsequent to a settlement hearing for the proceedings in Tribunal Case No. 11-061 regarding the Mud Lake Waste Disposal Site, which was held on the same day. Similar issues were addressed at that settlement hearing.
Issues
9The issues to be addressed are whether, based on the proposed settlement, all statutory requirements and the public interest are satisfied, as required under Rule 12.1 of the Tribunal’s Rules of Practice and Practice Directions (“Rules”), and whether the Tribunal should direct the Director to revoke the Director’s Order and dismiss the proceedings.
Confidentiality Order
10The Parties submitted that confidential information is contained in the proposed settlement and that the agreement should not be included in the Tribunal’s record or the public record. The Tribunal reviewed the settlement agreement and determined that it contains information that is of such a nature that the public interest and the interest of the person affected outweighs the desirability of adhering to the principle that documents filed in a proceeding should be available to the public. Pursuant to Rule 22.2 of the Tribunal’s Rules, the Tribunal ordered that the settlement agreement be treated as confidential and not be disclosed to the public.
Evidence and Submissions
Evidence and Submissions of the MECP and the Appellants
11In support of the proposed settlement, the Director filed the affidavit of Trina Rawn, which was affirmed on June 21, 2021. Ms. Rawn is the Director who issued the Director’s Order. At the settlement hearing, she also provided oral evidence in response to questions posed by the Tribunal.
12Resolute Canada filed an affidavit affirmed by Michael P. Smith on June 21, 2021. Mr. Smith is a hydrogeologist. He attached a report summarizing data and the site conditions at the waste disposal site. He gave brief testimony at the settlement hearing supporting Ms. Rawn’s evidence.
13Ms. Rawn stated that there is a potential purchaser that may be interested in acquiring and using the unused portion of the Margach waste disposal site. To accommodate this possible sale of the site, she stated that the proposed settlement provides Resolute Canada and OfficeMax Incorporated with an 18-month period to make commercially reasonable efforts to facilitate due diligence regarding the purchase of the site by the potential purchaser. She stated that if, after this 18-month period, title to the waste disposal site is not transferred to the potential purchaser, Resolute Canada and OfficeMax Incorporated will commence implementation of a closure plan.
14Ms. Rawn stated that the MECP holds roughly $1,796,511.00 in financial assurance. She stated that during the 18-month period, Resolute Canada will continue to carry out the maintenance, monitoring and reporting work described in the Amended Interim Order until either title is transferred to the potential purchaser or implementation of the closure plan is commenced. She said Resolute Canada and OfficeMax Incorporated are responsible for the cost of carrying out this work.
15Ms. Rawn stated that if, after conducting its due diligence, the potential purchaser wishes to purchase the waste disposal site, then, prior to the transfer of title, the financial assurance held by the MECP will be required to be increased to the amount of $4,100,961.00. She stated that this amount is approximately 70% of the most recent estimate of required financial assurance for the waste disposal site to cover the costs of implementing a closure plan and the long-term maintenance and monitoring of the site. She said it is expected that the potential purchaser will contribute the remaining 30% of the required financial assurance. Ms. Rawn stated that if the waste disposal site is transferred to the potential purchaser, it assumes all responsibility for the management of the site, including its operation, maintenance and monitoring, closure, and post-closure maintenance and monitoring.
16Ms. Rawn stated that if the potential purchaser decides not to purchase the waste disposal site within the 18-month time period, Resolute Canada and OfficeMax Incorporated will be required under the proposed settlement to commence implementing a closure plan and will be responsible for the costs of implementing it. She stated that this eliminates the need to provide additional financial assurance for the closure of the site. She stated that within three months of completion of the closure plan, Resolute Canada, OfficeMax Incorporated and MECP will meet to discuss next steps in relation to future work necessary at the waste disposal site. She stated that discussions at the meeting may include a review of the remaining post-closure monitoring, maintenance and reporting work, a re-evaluation of required financial assurance, and discussions on whether any Appellants should be relieved from long-term responsibility for the waste disposal site.
17Ms. Rawn stated that the proposed settlement also includes provisions regarding access to the waste disposal site, limits on further environmental orders over a limited time period, and the release of the six individuals named in the Director’s Order. She stated that these persons are no longer involved with the waste disposal site and the corporate Appellants will remain involved and have the resources to address the maintenance of the site.
18Ms. Rawn stated that the Director’s Order is consistent with the purpose and provisions of the EPA and is in the public interest. She stated that she is satisfied that Resolute Canada has complied with the requirements in the Interim Order and Amended Interim Order, resulting in the completion of several of the work items in the Director’s Order and the continued carrying out of others. She stated that a draft closure plan, which is acceptable to the MECP, was finalized in June 2021. She stated that she is satisfied that the environmental concerns set out in the Director’s Order continue to be addressed to prevent or reduce the risk of a discharge of a contaminant into the natural environment from the waste disposal site, and to prevent, decrease or eliminate an adverse effect that may result from the presence or discharge of a contaminant from the site. Ms. Rawn stated that the proposed settlement ensures that the work currently being undertaken under the Director’s Order and Amended Interim Order will continue until either the potential purchaser gains title to the waste disposal site or the commencement of the implementation of the closure plan.
19Ms. Rawn said the proposed settlement is in the public interest and is consistent with the purpose of the EPA in that it:
- concludes the proceedings and avoids lengthy and complex litigation that would require significant public and private resources;
- provides for the submission of the required financial assurance if the waste disposal site is purchased or for the implementation of the closure plan;
- facilitates the potential sale of the waste disposal site allowing it to continue to be operated under a new viable owner while it has capacity;
- provides for the closure plan’s implementation if there is no sale of the waste disposal site within a reasonable time period;
- does not unduly fetter the authority of the MECP to take future regulatory actions to ensure that the waste disposal site does not pose a risk to the environment or human health;
- allows for the release of the six persons named as Appellants while having minimal impact on the MECP’s ability to exercise its regulatory authority in respect of the waste disposal site; and,
- creates a process for the MECP, Resolute Canada and OfficeMax Incorporated to continue discussions regarding the long-term maintenance, monitoring and other post-closure work that may be required, without the need for litigation.
20Based on these outcomes of the proposed settlement, Ms. Rawn stated that she is satisfied that the proposed settlement is in the public interest and is protective of the natural environment and human health. She stated that she is satisfied that the proposed revocation of the Director’s Order is consistent with the purpose of the EPA and protects the natural environment and human health.
21The Appellants support the MECP’s submissions.
Submissions of the City
22The City filed written submissions. It stated that no municipal taxes have been paid on the waste disposal site lands for more than a decade. It submitted that the City has a lien on the lands and a tax sale may be initiated. It submitted that it is not a party to the proposed settlement or the proceedings and that nothing in the proposed settlement binds the City or fetters or prevents the City from exercising any of its rights. It requested that it be provided notice and an opportunity for consultations should any steps be taken that may affect its lien.
Analysis and Findings
23The procedure to be followed by the Tribunal, where there is a proposed settlement before a hearing event, is set out in Rule 12.1 of the Tribunal’s Rules. The Rule states:
12.1 The Tribunal may hold a hearing on the terms of a settlement if the parties in the proceeding agree to a settlement prior to a hearing event. The Tribunal may issue any directions to the parties necessary to ensure compliance with all statutory requirements, or to assist the Tribunal, prior to convening the settlement hearing. If all statutory requirements and the public interest are satisfied, the Tribunal may issue an order approving the settlement, with any necessary amendments.
24Under this Rule, if all statutory requirements and the public interest are satisfied, the Tribunal may issue an order approving a proposed settlement, with any necessary amendments. On considering the relevant statutory provisions and the public interest, the Tribunal has the discretion to confirm, alter or revoke the Director’s Order under s. 145.2(1) of the EPA and the discretion to either continue with or dismiss the proceedings.
25The EPA contains the applicable statutory requirements in the present case. Section 3 of the EPA sets out the Act’s purpose, which is to provide for the protection and conservation of the natural environment. The Director’s Order was issued under s. 18, s. 44, and s. 132 of the EPA, the objectives of which include:
- s. 18 - to prevent or reduce the risk of a discharge of a contaminant into the natural environment and to prevent, decrease or eliminate an adverse effect that may result from the discharge of a contaminant;
- s. 44 - to ensure that waste disposal sites are properly maintained; and,
- s. 132 - the provision of appropriate financial assurance for the performance of work under an Order and/or to prevent adverse effects following the closing of works.
26Based on Ms. Rawn’s uncontradicted evidence, the Tribunal finds that the proposed settlement satisfies all the statutory requirements in the EPA and is in the public interest. The proposed settlement results in the continuation and expansion of the work required under the Director’s Order, the continuation of monitoring, sampling, and maintenance at the waste disposal site, and financial assurance to ensure that necessary work is completed. If the waste disposal site is not sold, the proposed settlement sets out the steps for its closure and a process for continuing discussions on future steps. The Tribunal finds that it ensures the application of the polluter pays principle and the provision of resources for the continuation of work at the waste disposal site to help ensure the protection and conservation of the natural environment. Based on these considerations, the Tribunal finds that the proposed settlement is consistent with the purpose and provisions of the EPA and is in the public interest. It finds that the proposed settlement ensures that all statutory requirements are satisfied.
27The Tribunal notes that the City will receive notice through the Environmental Registry of further orders or approvals by the MECP and it will receive notice of any court proceedings that will be necessary if title to the waste disposal site is transferred.
28Based on the proposed settlement, the Tribunal finds that the Director’s Order should be revoked and the proceedings should be dismissed.
ORDER
29The Tribunal orders that the settlement agreement document be treated as confidential and not be disclosed to the public.
30The Tribunal orders that the appeals are allowed, in part, and directs the Director to revoke the Director’s Order.
31The Tribunal orders that the proceedings are dismissed.
“Hugh S. Wilkins”
HUGH S. WILKINS
MEMBER
Ontario Land Tribunal
Website: olt.gov.on.ca Telephone: 416-212-6349 Toll Free: 1-866-448-2248
The Conservation Review Board, the Environmental Review Tribunal, the Local Planning Appeal Tribunal and the Mining and Lands Tribunal are amalgamated and continued as the Ontario Land Tribunal (“Tribunal”). Any reference to the preceding tribunals or the former Ontario Municipal Board is deemed to be a reference to the Tribunal.
Appendix 1
Appellant List (11-144)
Appellant Name
File No.
OfficeMax Incorporated
11-144
AbitibiBowater Inc.
11-146
AbiBow Canada Inc.
11-147
Abitibi-Consolidated Company of Canada
11-148
Pierre Rougeau
11-149
David J. Paterson
11-150
Allen Dea
11-151
Jacques P. Vachon
11-152
William G. Harvey
11-153
Alain Grandmont
11-154