Her Majesty the Queen v. Petro-Canada [Indexed as: R. v. Petro-Canada]

63 O.R. (3d) 219

[2003] O.J. No. 216

Docket No. C35741

Court of Appeal for Ontario

Catzman, Laskin and Goudge JJ.A.

January 29, 2003

Criminal law -- Provincial offences -- Defences -- Due diligence -- Defendant not required to prove precise cause of particular event giving rise to charge before defence of due diligence available.

Environmental law -- Enforcement -- Offences -- Due diligence -- Defendant charged with discharging contaminant into natural environment following gasoline spill which resulted from pipe failure -- Trial judge erring in holding that defence of due diligence not available to defendant as defendant did not prove cause of pipe failure -- [page220] Defendant only required to establish that it took all reasonable steps to avoid discharge of gasoline -- Defendant not required to prove precise cause of particular event giving rise to charge in order to engage due diligence defence -- Environmental Protection Act, R.S.O. 1990, c. E.19, s. 14(1).

The defendant was charged with discharging or causing or permitting the discharge of a contaminant, gasoline, into the natural environment contrary to s. 14(1) of the Environmental Protection Act. A gasoline spill occurred at the defendant's premises as a result of the failure of a pipe. The trial judge found that the Crown had proven all the essential elements of the offence. As the offence was one of strict liability, he then considered the defence of due diligence and found that it was not available to the defendant in this case as there was no evidence explaining why the pipe failed. The defence only applies, he held, if the defendant proves the precise cause of the failure. The defendant was convicted. The appeal judge held that the trial judge erred in finding that the defence of due diligence could not be applied because the cause of the pipe failure was unknown. He set aside the conviction and entered an acquittal. The Crown appealed.

Held, the appeal should be allowed.

The defence of due diligence is available if the defendant establishes that he took all reasonable steps to avoid the particular event. The particular event in this case was the discharge of gasoline. The defendant was not required to prove the precise cause of the discharge, that is, precisely why the pipe failed, before it could engage the defence of due diligence.

The appeal judge erred in stating that the due diligence defence is made out unless it is patently obvious that the defendant did not use reasonable care amounting to due diligence or that it violated industry standards and/or statutory commitments. This appeared to place the onus of disproving due diligence on the Crown, and also suggested that only where the care taken falls so much short of the "all reasonable steps" requirement that this shortcoming is "patently obvious" will the defence fail. The onus is on the defendant to establish, on a balance of probabilities, that it took all reasonable steps to avoid the particular event.

APPEAL by the Crown from a judgment allowing an appeal from a conviction.

R. v. City of Sault Ste. Marie, 1978 11 (SCC), [1978] 2 S.C.R. 1299, 85 D.L.R. (3d) 161, 21 N.R. 295, 3 C.R. (3d) 30, 40 C.C.C. (2d) 353, 70 C.E.L.R. 53, apld R. v. ITT Industries of Canada Ltd., unreported, April 13, 1993 (Ont. C.A.), consd Other cases referred to Ontario v. London Excavators & Trucking Ltd. (1998), 1998 3479 (ON CA), 40 O.R. (3d) 32, 37 C.C.E.L. (2d) 25, 125 C.C.C. (3d) 83 (C.A.), affg (1997), 26 C.C.E.L. (2d) 132 (Ont. Prov. Div.) (sub nom. R. v. London Excavators & Trucking Ltd.) Statutes referred to Environmental Protection Act, R.S.O. 1990, c. E.19, s. 14(1)

John Semenoff, for appellant. Franklin T. Richmond and Bryan Buttgieg, for respondent. [page221]

The judgment of the court was delivered by

[1] GOUDGE J.A.: -- This appeal raises two questions of law concerning the application of the due diligence defence to a strict liability charge. The first is whether, to engage the defence, the accused must prove the precise cause of the particular event giving rise to the charge in order to show that the steps it took to prevent that event constitute all reasonable care. The second, and more commonplace question, involves the onus of establishing the defence, and who bears it.

[2] The charge faced by the respondent Petro-Canada in this case was that it:

On or about the 14th and 15th days of January 1993, at or near 300-106th Street, in the City of Thunder Bay, in the District of Thunder Bay, did commit the offence of discharging or causing or permitting the discharge of a contaminant, namely gasoline, into the natural environment that causes or was likely to cause an adverse effect, contrary to Section 14(1) of the Environment Protection Act, R.S.O. 1990, c. E.19, as amended.

[3] At trial, Justice of the Peace Logan made a number of findings of fact. He found that a spill of gasoline had occurred during the relevant dates at Petro-Canada's premises in Thunder Bay. The spill resulted from the failure of a pipe at the point where it was passing through an earthen berm. The spread of the spilled gasoline was compounded by two of Petro- Canada's employees. One employee had manipulated gasoline reconciliation records thereby disguising the spill. The other employee had failed to close a valve upstream of the point where the pipe failed.

[4] The trial judge concluded that the Crown had proven all the essential elements of the offence. Having determined that this was a strict liability offence, he then turned to the due diligence defence. He found that Petro-Canada had a number of safety systems and procedures in place both to prevent a pipe failure and, if it happened, to quickly detect it and mediate its effects.

[5] However, he said that he was unable to apply that defence in this case because there was no evidence before him explaining why the pipe failed and without that he could not determine if Petro-Canada had taken reasonable care. He put his point this way at p. 6 of his reasons:

The test in reference to due diligence is to be applied to this event, and I find I am unable to do this. I cannot because there is no evidence before me on the subject of the cause of the failure. Was the failure caused by say, corrosion, a frost heave, sabotage or mechanical accident? This is unknown.

[6] Two pages later he reiterated the point:

Beyond this I have no evidence before me as to say for example, the age of the pipes or their conformation to industry standards, if in fact the standard [page222] exists, or the required industry precaution if any, for pipe sections where they pass through berms, or anything on the condition of the pipes beyond a somewhat casual observation of a crown witness that they appeared in his estimation, to be in excellent condition.

I cannot apply the standard of that of a balance of probabilities, that is the test in the application of due diligence, in reference to the efforts of Petro-Canada, just listed, because I do not know why the pipe failed.

[7] The trial judge then went on to interpret R. v. ITT Industries of Canada Ltd. (Ont. C.A., unreported, April 13, 1993) as requiring that the precise cause of the failure be proven by the accused in order for the defence to apply. Since Petro-Canada had not done so in this case, the trial judge found that the defence had not been made out. As a consequence, he concluded that it must be convicted.

[8] On appeal to the Ontario Court of Justice, Sargent J. concurred that this is a strict liability offence and that the Crown had proven the required elements of it.

[9] However, the appeal judge disagreed with the view of the trial judge that the defence of due diligence could not be applied in this case because the cause of the pipe failure was unknown. He then briefly reviewed the evidence heard at trial about the safeguards that Petro-Canada had in place to prevent such an accident and concluded that the defence of due diligence had been established by saying the following at p. 6:

After reviewing the case law and all the facts as found by the Justice of the Peace, this Court believes that a due diligence defense is made out in this case, unless it was patently obvious that reasonable care amounting to due diligence was not met or that it violated industry standards and/or statutory commitments.

[10] In the result, the appeal judge set aside the conviction and directed an acquittal.

[11] Rosenberg J.A. found that this case raises the questions of law recited above and therefore granted leave to this court.

[12] The first of these questions concerns the different views of the trial judge and the appeal judge about the burden on the accused to establish the precise cause of the pipe failure in order to raise a due diligence defence.

[13] The answer to this question must begin with the seminal judgment of Dickson J. (as he then was) in R. v. City of Sault Ste. Marie, 1978 11 (SCC), [1978] 2 S.C.R. 1299, 40 C.C.C. (2d) 353. There, as here, the accused was charged with discharging or causing to be discharged certain polluting substances into a water system. Dickson J. used this context to give recognition to a third category of offences, in addition to those requiring proof of mens rea, and those of absolute liability requiring mere proof of the prohibited [page223] act. The famous passage in which he did so is at p. 1326 S.C.R., p. 374 C.C.C. and reads as follows:

2. Offences in which there is no necessity for the prosecution to prove the existence of mens rea; the doing of the prohibited act prima facie imports the offence, leaving it open to the accused to avoid liability by proving that he took all reasonable care. This involves consideration of what a reasonable man would have done in the circumstances. The defence will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event. These offences may properly be called offences of strict liability.

(Emphasis added)

[14] Dickson J. described the balance in this approach by saying that while it relieved the Crown of the burden of proving mens rea, it also stopped short of imposing absolute liability, which would deny an accused any defence whatsoever. He explained the fairness of putting the burden on the accused to establish the due diligence defence as follows at p. 1325 S.C.R., p. 373 C.C.C.:

In a normal case, the accused alone will have knowledge of what he has done to avoid the breach and it is not improper to expect him to come forward with the evidence of due diligence.

[15] While, in the end, Dickson J. ordered a new trial, he did describe briefly how the defence of reasonable care might operate in the context of the charge in that case. At p. 1331 S.C.R., p. 377 C.C.C., he made clear that the question would be whether the accused had negated its wilful involvement in the act charged and ". . . whether the accused exercised all reasonable care by establishing a proper system to prevent commission of the offence and by taking reasonable steps to ensure the effective operation of the system". The focus of the defence is the discharge and the steps taken to prevent it.

[16] In my view, it is clear from Dickson J.'s reasoning that in a case like this one"the particular event" which the accused must show it has taken all reasonable steps to avoid is the discharge of the polluting substance into the particular water system. There is no suggestion in the language of Dickson J. that the accused must first prove the precise cause of the discharge before it can engage the defence of due diligence.

[17] Moreover, such a requirement would be inconsistent with the fairness described by Dickson J. While the accused will know what it has done to avoid the discharge and can fairly be asked to say so, the accused may well not know precisely how the discharge came about. In my view, to require the accused to prove something that may well be beyond its knowledge to trigger this [page224] defence moves this category of offence closer to absolute liability than Dickson J. intended.

[18] The same approach is implicit in the language used by Catzman J.A. for this court when he said this about the due diligence defence in Ontario v. London Excavators & Trucking Ltd. (1998), 1998 3479 (ON CA), 40 O.R. (3d) 32, 125 C.C.C. (3d) 83 (C.A.) at p. 36 O.R.:

It is common ground between the parties that the offence with which the appellant was charged is one of strict liability. Once the actus reus of a strict liability offence is proved, a conviction must follow unless the accused establishes that it exercised due diligence to avoid the commission of the offence.

[19] Returning to this case, the offence charged is that the accused discharged or caused to be discharged a contaminant, namely gasoline, into the natural environment that caused, or was likely to cause, an adverse effect. Once the Crown proves this, the accused can successfully defend itself by showing on a balance of probabilities that it took all reasonable steps to avoid or prevent the discharge. The "particular event" is discharging or causing the discharge of gasoline as described in the charge.

[20] For these reasons I do not think that the law requires the accused to prove precisely how the discharge came about -- in this case precisely why the pipe failed -- in order to avail itself of the due diligence defence. On the other hand, in a case where the accused can do this, it may be able to narrow the range of preventative steps that it must show to establish that it took all reasonable care. However where, as here, the accused cannot prove the precise cause of the pipe failure the due diligence defence is not rendered unavailable as a result. That being said, it must be emphasized that to invoke the defence successfully in such circumstances, the accused must show that it took all reasonable care to avoid any foreseeable cause.

[21] In my view, the ITT case, supra, is not inconsistent with this approach. In that case the accused was charged with permitting the discharge of a contaminant. The exact cause of the discharge was undetermined. The accused attempted unsuccessfully to establish due diligence simply by showing that it had purchased and installed the best equipment and that the recording devices on this equipment showed no breakdown.

[22] In denying leave to appeal, Carthy J.A. noted that the latter evidence leads nowhere once a discharge is established. He went on to indicate that the due diligence defence was flawed in this case by the failure to demonstrate what happened, why, and what steps were taken to prevent the occurrence in the functioning of the plant on that day. In saying this Carthy J.A. was not making proof of the precise cause of the [page225] discharge a legal prerequisite to the due diligence defence. He is simply saying that the defendant must go beyond the purchase and installation of the best equipment to show what steps were taken to prevent the discharge on that day and that these steps constitute reasonable care, something which may be more easily demonstrated if it can be shown how the discharge occurred.

[23] Thus my answer to the first question of law is that the defendant need not establish the precise cause of the pipe failure in order to successfully raise a due diligence defence. I conclude that the appeal judge was correct in finding that the trial judge erred in concluding otherwise.

[24] The second question of law referred to by Rosenberg J.A. arises from the passage quoted earlier from the reasons of the appeal judge and relates to the onus of proving due diligence.

[25] Before turning to this issue, it appears that the quoted passage reveals another error of law. The appeal judge finds that the evidence indicates that the Petro-Canada terminal met all statutory and regulatory requirements and had a safety system that met industry standards. The findings of fact by the trial judge were exactly to the contrary in that there was no evidence that the pipes met industry standards. It was not open to the appeal judge to retry this aspect of the case.

[26] More importantly, however, the appeal judge said that the due diligence defence is made out unless it is patently obvious that reasonable care amounting to due diligence was not met or that it violated industry standards and/or statutory commitments.

[27] This clearly appears to place the onus of disproving due diligence on the Crown. As well it suggests that only where the care taken falls so much short of the "all reasonable steps" requirement that this shortcoming is "patently obvious" will the defence fail. In both these respects the appeal judge departs from the law as set out in R. v. Sault Ste. Marie, supra, where it is made clear that the onus is on the defendant to establish, on a balance of probabilities, that it took all reasonable steps to avoid the particular event. Thus, in both respects, I think the appeal judge erred in law. His finding that the due diligence defence has been made out cannot stand.

[28] I would, therefore, conclude that while the appeal judge was correct to set aside the conviction at trial, he erred in law in directing an acquittal. Regrettably, given the length of time that has passed, the appeal must be allowed and a new trial directed.

Appeal allowed. [page226]