Eddy Huang v. Fraser Hillary's Limited and David Hillary

OTTAWA COURT FILE NO.: 07-CV-39359

DATE: 2015/12/22

ONTARIO

SUPERIOR COURT OF JUSTICE

BETWEEN:

EDDY HUANG

Plaintiff

– and –

FRASER HILLARY’S LIMITED and DAVID HILLARY

Defendants

Counsel:

Michael S. Hebert and Cheryl Gerhardt McLuckie, for the Plaintiff

Paul Muirhead, for the Defendant, David Hillary

HEARD: November 10, 2015

REASONS FOR DECISION

Motion for Summary Judgment

CORTHORN, J.

Introduction

[1] The plaintiff is the owner of property with municipal addresses from 1255 to 1263 Bank Street in the City of Ottawa. The defendant, Fraser Hillary’s Limited (“FHL”) is the owner of 1235 Bank Street, which is located on the southeast corner of Bank Street and Cameron Avenue. FHL has operated a dry cleaning outlet store and facility at that location since the 1960’s. The 1235 and 1255 Bank Street properties are adjacent to one another, with the former located north of the latter.

[2] The defendant, David Hillary is the principal and sole shareholder of FHL. He is also the owner of 36 Cameron Avenue, a residential property that he purchased in 1986. That property is:

• Adjacent to 1235 Bank Street – east, northeast of the property. The two properties share a common driveway. All but approximately three feet of the driveway closest to 1235 Bank Street ‘belongs’ to 36 Cameron Avenue; and

• Also adjacent to and at the northeast corner of 1255 Bank Street (one of the properties owned by the plaintiff).

[3] In 2002 the plaintiff arranged for an Environmental Site Assessment of 1255 Bank Street to be carried out. The investigation revealed that the property at 1255 Bank Street is contaminated with tetrachloroethylene (“PERC” or “PCE”) and other volatile organic compounds – all of which are derived from chemicals used in the dry cleaning process. Remediation is required to address the contamination of 1255 Bank Street and other affected properties.

[4] The plaintiff’s claim against FHL and David Hillary is for damages in excess of $17,500,000, declaratory relief, and injunctive relief. The plaintiff relies on four potential bases of liability:

a) Nuisance;

b) Negligence;

c) Trespass; and

d) Statutory liability – pursuant to the provisions of the provincial Environmental Protection Act, R.S.O. 1990, c. E.19.

[5] When the action was commenced, FHL was the sole defendant. In 2010, Mr. Hillary was examined for discovery in his capacity as a representative of FHL. During the examination for discovery the plaintiff learned that David Hillary is the owner of 36 Cameron Avenue. In 2011, the plaintiff obtained leave to add David Hillary as a defendant in the action.

[6] David Hillary (“the defendant”) brings this motion for summary judgment, requesting dismissal of the plaintiff’s claims against him. Appearing on the return of the motion were counsel for the defendant and counsel for the plaintiff. FHL was served with the motion materials. FHL did not file any materials and was not represented on the return of the motion.

[7] The notice of motion and the supporting affidavit of the defendant are dated April 23 and 20, 2015 respectively. The motion record was served in early May 2015. The notice of motion identifies November 10, 2015 as the date of return and the motion was heard on that date. The trial of the action is scheduled to proceed on January 8, 2016 for three weeks, without a jury.

Positions of the Parties

a) The Defendant, David Hillary

[8] It is Mr. Hillary’s position that there is no genuine issue requiring a trial and the claims against him should be dismissed in their entirety. In the alternative, he requests that an order be made for a mini-trial restricted to the issue of whether or not the property at 36 Cameron Avenue is a source of the contaminants affecting the properties at 1255 to 1263 Bank Street.

i) Single Source of Contaminants – 1235 Bank Street

[9] The defendant emphasizes that his ownership of 36 Cameron Avenue commenced in 1986 - at least a decade after FHL changed the dry cleaning process they had, to that time, been using. By changing the dry cleaning process, FHL: a) eliminated the need for PERC filters to be used; b) eliminated the disposal of PERC filters and ‘sludge’ in the municipal garbage process; and c) was able to rely on the Ministry of the Environment to handle the disposal of dry cleaning waste. In the 1970’s FHL stopped placing garbage for collection, including cardboard boxes containing PERC filters and ‘sludge’, at the back of the building at 1235 Bank Street. To that point, garbage for collection had been placed on the FHL side of the shared driveway between 1235 Bank Street and 36 Cameron Avenue.

[10] The defendant says that as the owner of 36 Cameron Avenue he is in the same position as is the plaintiff. They are each a ‘victim’ of the contaminants which emanate from a single source: 1235 Bank Street. The defendant’s position is that even if it can be established that contaminants which flowed from 1235 Bank Street to 36 Cameron Avenue in turn flowed (and continue to flow) from 36 Cameron Avenue to 1255 to 1263 Bank Street, he is in no way personally liable for the flow of the contaminants to or the existence of contaminants at the properties owned by the plaintiff.

[11] In summary, the defendant says that he is not an ‘offender’ in any way with respect to the contamination of the soil and groundwater at 1255 to 1263 Bank Street. The defendant succinctly states his position at paragraph 40 of his affidavit, “I am personally bringing this motion for summary judgment on the basis that as a homeowner of [36 Cameron Avenue] I am not liable for the contamination of the Plaintiff’s Property. At no time ha[ve] any dry cleaning operations been conducted on this property.”

ii) Criticism of Expert Evidence - Generally

[12] The defendant is critical of the expert evidence upon which the plaintiff intends to rely at trial. His criticism is as to how, over time, the opinion of the plaintiff’s experts has ‘evolved’, in particular with respect to the source of the contamination of 1255 to 1263 Bank Street (“the plaintiff’s properties”).

[13] Each of the experts retained by the plaintiff and by FHL has been involved in this matter for over a decade. In February 2009, the expert retained on behalf of FHL prepared a report in which the authors express their opinion as to the source of the contamination of the soil and groundwater at the plaintiff’s properties. In March 2009, the expert retained on behalf of the plaintiff prepared a responding report. These 2009 reports are the starting point for the defendant’s criticism with respect to the ‘evolution’ of the opinions expressed by the plaintiff’s experts as to the source of the contaminants at the plaintiff’s properties.

[14] For the purpose of this motion and in the litigation generally the defendant relies on the opinions expressed by the experts retained on behalf of FHL: Conestoga-Rovers & Associates (“CRA”).

[15] In its February 2009 report, CRA expresses the opinion that the PERC soil impact observed in the northeast portion of 1235 Bank Street and the northwest corner of 1255 Bank Street, “is most likely related to small volume historical release(s) of dry cleaning fluids originating from 1235 Bank Street (Hillary’s Dry Cleaner) which would have been transported with the groundwater flow towards the east northeast”.[^1]

[16] Golder Associates (“Golder”), who is retained on behalf of the plaintiff, critiqued the February 2009 CRA report. The defendant relies on the following passage from the March 2009 Golder report as evidence of the agreement, in early 2009, between CRA and Golder as to ‘the’ single source of the contaminants identified at the plaintiff’s properties:

The available groundwater analytical results confirm that there is one source causing the groundwater plume in the overburden as shown in Figure 4. The plume originates from the dry cleaner at 1235 Bank Street and extends towards the adjacent properties located approximately east to southeast from the dry cleaner. [^2]

[17] The defendant describes, as follows, the ‘evolution’ subsequent to 2009, of the opinions expressed by the plaintiff’s experts:

• In 2009 CRA and Golder were in agreement that the source of the contaminants at the plaintiff’s properties is 1235 Bank Street.

• It was not until 2010 that the opinions expressed by Golder evolved to identify both 1235 Bank Street and 36 Cameron Avenue as sources or as being within “the source zone” of the contaminants at the plaintiff’s properties.

• The turning point for that evolution was the examination for discovery of David Hillary, in 2010 in his capacity as a representative of FHL. At that examination for discovery David Hillary gave evidence regarding his purchase and ownership of 36 Cameron Avenue.

• In their November 2010 report, Golder refers to “a source zone” of dry contaminants at 36 Cameron Avenue. The bases for that opinion are the results of samplings from three monitoring wells. One of the wells is located between 36 Cameron Avenue and 1235 Bank Street. The other two wells are located in the basement of the dry cleaning building and on the southeast portion of the boundary between 1235 and 1255 Bank Street.

• On the basis of: a) David Hillary’s ownership of 36 Cameron Avenue; and b) the opinions expressed by Golder in November 2010 regarding “a source zone” of contaminates at 36 Cameron Avenue, the plaintiff sought and obtained leave of the Court to add David Hillary as a defendant on the basis of his ownership of 36 Cameron Avenue.

iii) Criticism of Expert Evidence – On Motion

[18] The defendant refers to the obligation on a party facing a summary judgment motion to put their ‘best foot forward’. He argues that the plaintiff has, in responding to the motion for summary judgment, failed to fulfil that obligation. The expert opinions upon which the plaintiff relies for the purpose of the motion are before the Court in the form of exhibits to the plaintiff’s affidavit.

[19] The defendant says that if the plaintiff’s position is that 36 Cameron Avenue is ‘a’ source, ‘the’ source, or part of “the source zone” of contaminants, then it was incumbent on the plaintiff for the purpose of the summary judgment motion to deliver an affidavit sworn by one or more experts in which that opinion is expressed. Absent such an affidavit, it is not possible for either the defendant or the Court to test the opinions expressed by the expert(s). As a result, there is no expert evidence before the Court on this motion to support a finding that the defendant is, by reason of his ownership of 36 Cameron Avenue, liable to the plaintiff.

iv) No Basis in Law for a Finding of Liability

[20] The defendant argues that the case law does not support a finding of liability as against him based on any of the four grounds (see below) relied on by the plaintiff.

v) Alternatives to Granting Summary Judgment

[21] The defendant submits that as an alternative to summary judgment, the Court is in a position to grant partial summary judgment, dismissing some of the claims against him with the remaining claims to be determined at trial or at a mini-trial. The defendant submits that there is a discreet issue which is appropriate for a mini-trial: Is 36 Cameron Avenue ‘a’ source of the contaminants present at the plaintiff’s properties?

b) The Plaintiff, Eddy Huang

[22] The plaintiff’s position is that for him to succeed with his claim against the defendant the following facts must be established:

1. The contaminants are present at 36 Cameron Avenue in high volume;

2. The property at 36 Cameron Avenue is ‘a’ source or part of “the source zone” of contaminants affecting the plaintiff’s properties; this point regardless of a finding, if made, that 1235 Bank Street is the ultimate source of the contaminants;

3. The source of the contaminants needs to be removed to prevent further contamination of the plaintiff’s properties; and

4. David Hillary knew of the existence of the contaminants including the presence of the contaminants and the level to which they are present at 36 Cameron Avenue.

[23] The plaintiff submits that if points 1 through 4 are established, then it follows that the defendant is liable to the plaintiff on the basis of one or more of: a) negligence; b) nuisance; c) trespass; and d) statutory liability pursuant to the provisions of the provincial Environmental Protection Act.

[24] In support of the claim based on statutory liability, the plaintiff relies on the failure of the defendant to comply with the terms of the order he received from the Ministry of the Environment (“MOE”). The plaintiff says that by reason of the defendant’s lack of compliance with the order, the plaintiff is precluded from developing more robust evidence as to the extent to which 36 Cameron Avenue: a) is ‘a’ source of the pure contaminant; and b) is affected by the contaminants. The MOE order requires that the defendant permit a borehole to be established on the far east side of 36 Cameron Avenue. The evidence of the plaintiff is that to date the defendant has not co-operated in that regard. The experts retained on behalf of the plaintiff express the opinion that contaminated groundwater continues to flow from 36 Cameron Avenue to the plaintiff’s properties.

The Issues

[25] The issues to be determined on this motion for summary judgment are:

1. Is there a genuine issue requiring a trial with respect to the plaintiff’s claims against David Hillary on the basis of one or more of:

a) Negligence;

b) Nuisance;

c) Trespass; and

d) Statutory liability – the Environmental Protection Act?

2. Is this an appropriate case for a mini-trial with respect to the issue of whether 36 Cameron Avenue is ‘a’ source or part of “the source zone” of the contaminants affecting the plaintiff’s properties?

3. Are there any orders, pursuant to subrule 20.05(2) – Directions and Terms – of the Rules of Civil Procedure, R.R.O. 1990, Reg. 194 that can be made?

The Law

[26] Pursuant to subrule 20.01(3) of the Rules of Civil Procedure, a defendant may, after delivering a statement of defence, move with supporting affidavit material or other evidence for summary judgment dismissing all or part of the claim in the statement of claim. On such a motion, the Court shall grant summary judgment if it is satisfied that there is no genuine issue requiring a trial with respect to a claim or a defence (subrule 20.04(2) of the Rules of Civil Procedure).

[27] The moving party bears the onus of proving there is no genuine issue requiring a trial -unless the moving party demonstrates a prima facie right to summary judgment. In the latter case, the responding party bears the onus of demonstrating that there is a genuine issue requiring a trial. See: Toronto Dominion Bank v. 466888 Ontario Ltd., 2010 ONSC 3798, 103 O.R. (3d) 502, aff’d 2011 ONCA 149, at para. 2.

[28] The framework for determination of motions for summary judgment has evolved in recent years specifically because of amendments to the Rules of Civil Procedure and the decision of the Supreme Court of Canada in Hryniak v. Mauldin, 2014 SCC 7; [2014] 1 S.C.R. 87 (“Hyrniak”).

[29] There has, in recent years, been a particular focus on the expanded powers of the Court as set out in subrule 20.04(2.1) of Rules of Civil Procedure. In determining whether there is a genuine issue requiring a trial, the court is mandated to consider the evidence submitted by the parties and in doing so the judge may exercise the following powers:

1. Weighing the evidence.

2. Evaluating the credibility of a deponent.

3. Drawing any reasonable inference from the evidence.

[30] At paragraph 66 of Hryniak, the Supreme Court of Canada set out, as follows, the approach to be taken by the judge on a motion for summary judgment:

On a motion for summary judgment under Rule 20.04, the judge should first determine if there is a genuine issue requiring trial based only on the evidence before her, without using the new fact-finding powers. There will be no genuine issue requiring a trial if the summary judgment process provides her with the evidence required to fairly and justly adjudicate the dispute and is a timely, affordable and proportionate procedure, under Rule 20.04(2)(a). If there appears to be a genuine issue requiring a trial, she should then determine if the need for a trial can be avoided by using the new powers under Rules 20.04(2.1) and (2.2). She may, at her discretion, use those powers, provided that their use is not against the interest of justice. Their use will not be against the interest of justice if they will lead to a fair and just result and will serve the goals of timeliness, affordability and proportionality in light of the litigation as a whole.

[31] Summary judgment must be granted whenever there is no genuine issue requiring a trial. There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process: 1) allows the judge to make the necessary findings of fact; 2) allows the judge to apply the law to the facts; and 3) is a proportionate, more expeditious and less expensive means to achieve a just result. See: Hryniak, at paras. 47 and 49.

Preliminary Issue: Evidence on the Motion

[32] Before addressing the substantive issues on the motion, I must address the evidentiary issue raised by the defendant. As noted above, the defendant is critical of the plaintiff for the evidence upon which he relies in response to the motion for summary judgment. The criticism is that:

• The responding motion record contains a single affidavit, which is in the name of the plaintiff;

• To the plaintiff’s affidavit are attached a number of experts reports – prepared by CRA, Golder, and Geosyntec. Also attached is a memorandum from Geosyntec to counsel for the plaintiff;

• In his affidavit, the plaintiff sets out some of the opinions expressed and conclusions reached by the experts;

• In addition, the plaintiff refers at paragraph 13 of his affidavit to information provided to him by Brian Bylery of Golder. That information is to the effect that the migration of contamination from 36 Cameron to the plaintiff’s properties will continue until such time as the source is isolated or removed. That information does not otherwise appear in any of the Golder reports attached as exhibits to the plaintiff’s affidavit; and

• There is no affidavit evidence from any of the experts upon whose evidence the plaintiff will rely at trial.

[33] On a motion for summary judgment the parties have an obligation to put their ‘best foot forward’. In that context, I agree with the defendant’s criticism of the reliance by the plaintiff on an affidavit in his name only and the lack of affidavit evidence from one or more of the authors of the Golder reports.

[34] However, the same criticism may be made of the defendant. In support of his motion for summary judgment, the defendant relies exclusively on an affidavit in his name to which copies of experts’ reports are attached as exhibits. Numerous experts’ reports (CRA, Golder, and Geosyntec) are attached as exhibits to the defendant’s affidavit.

[35] On the return of the motion I specifically raised with counsel whether or not they had reached an agreement as to the consideration which the experts reports, attached as exhibits such as they are, are to given by the Court in determining the motion for summary judgment. Counsel had not reached an agreement in that regard and acknowledged that the consideration to be given to the experts’ reports is entirely within my discretion.

[36] The defendant did not rely on any cases in support of his criticism of the plaintiff’s reliance on experts’ reports in the form of exhibits attached to the plaintiff’s affidavit. There is, however, an abundance of case law in which my colleagues of this Court are critical of a party appending an expert’s report as an exhibit to an affidavit in the name of someone other than the expert. See: Danos v. BMW Group Financial Services Canada, 2014 ONSC 2060; Toronto Dominion Bank v. Schrage (2009), 65 B.L.R. (4th) 277 (Ont. S.C.); and Beatty v. Waterloo (Regional Municipality), 2011 ONSC 3599; 85 M.P.L.R. (4th) 269 (“Beatty”).

[37] I find that the experts’ reports appended to the plaintiff’s affidavit and those attached to the defendant’s affidavit are inadmissible hearsay. Hearsay evidence is defined as out-of-court statements, without the opportunity for cross-examination, which are admitted for the truth of their contents. Although the new Rule 20 of the Rules of Civil Procedure gives judges expanded powers to weigh evidence that expanded power does not include permitting hearsay evidence to be admitted.

[38] In considering the experts’ reports before me on this motion, I follow the approach taken by MacPherson J. (as he then was) in Beatty. In that matter all of the plaintiffs had settled their claims. The apportionment of liability as between the defendants and third parties remained to be determined. One of the defendants and one of the third parties each brought a motion for summary judgment. Only one expert’s report was included in the records filed on the motions.

[39] Dealing with the singular expert’s report, MacPherson J. said at paragraphs 33 and 34:

However, in the circumstances of this motion, I find that it is appropriate to consider the report not for the truth of its contents but to demonstrate that the report exists and that there is evidence on the issue of causation that would form part of the Municipal Defendants’ case at trial and for the limited purpose of establishing whether there is a genuine issue for trial.

Otherwise, if I were to simply ignore the existence of the report entirely, this would overlook the reality of the situation – two accidents occurred in snowy conditions on a road adjacent to the Mattamy subdivision and as between the remaining Defendants/Third Parties some or all of them are liable to the Plaintiffs for the damages suffered.

[40] In determining the issues on this motion, I therefore treat the experts’ reports as “some evidence” as to the source(s) and source zone(s) of the contaminants affecting the plaintiff’s properties. That evidence is considered in determining whether there is a genuine issue requiring a trial with respect to one or more of the four alleged bases of liability on the part of the defendant.

Decision

[41] There are genuine issues for trial with respect to the plaintiff’s claim against the defendant in its entirety. I am unable, even with the expanded powers pursuant to subrule 20.04(2.1) of the Rules of Civil Procedure, to make the findings necessary to resolve the plaintiff’s claim against the defendant with respect to any one or more of the alleged bases of liability. I am unable to do so because the potential liability of the defendant rests on: a) a comprehensive understanding of the opinions expressed by the experts whose reports are before me; and b) findings of fact based on those opinions.

[42] Only with the assistance of the oral evidence of the expert witnesses, tested on cross-examination, will it be possible to make the findings of fact required to resolve the plaintiff’s claims against the defendant. Listed below are but a few of the issues that I have identified from my review of the experts’ reports:

• The distinction, if any, between ‘a’ source, ‘the’ source, and “source zone” of contaminants affecting the plaintiff’s properties;

• Whether those terms take on a different significance depending on the context within which they are being discussed: for example, identification of property or properties that are the ultimate source of the contaminants versus identification of the affected properties for the purpose of remediation;

• With respect to each of negligence, nuisance, and trespass:

➢ Whether the defendant is, like the plaintiff, a ‘victim’ of the residual contaminants from the dry cleaning store and facility or an ‘offender’ with respect to the flow of contaminants from 36 Cameron Avenue to 1255 to 1263 Bank Street; and

➢ Whether the defendant, if found to be a ‘victim’ as relates to the ultimate source of the contaminants, becomes an ‘offender’ once he is informed of the existence of the migration of contaminants from 36 Cameron Avenue to the plaintiff’s properties and fails to take any steps to reduce or eliminate the migration of contaminants.

• If the defendant is found to be an ‘offender’ and is thus liable to the plaintiff, the opinions of the experts may be relevant to the issue of causation: To what extent have the acts and/or omissions, if any, of the defendant contributed to the existence of the contaminants at the plaintiff’s properties over and above the contribution of the defendant FHL as what appears to be the ultimate source of the contaminants?

[43] The issues for which the benefit of the oral testimony of the expert witnesses is required are not discreet. The issues are relevant to the majority, if not all, of the alleged bases of liability. The issues are also relevant to the assessment of the damages to which the plaintiff may be entitled from each of FHL and the defendant.

[44] In the circumstances of this case, a mini-trial with respect to the issue of whether 36 Cameron Avenue is ‘a’ source or within “the source zone” of contaminants affecting the plaintiff’s properties is not appropriate. That issue cannot be severed from the fabric of the case as a whole.

[45] The motion for summary judgment is dismissed.

[46] The trial of this action is scheduled to proceed on January 8, 2016 for three weeks. For the reasons set out below, I do not: a) remain seized of this matter; or b) make any orders pursuant to subrule 20.05(2) of the Rules of Civil Procedure.

Issue No. 1: Is There a Genuine Issue Requiring a Trial?

The Experts’ Reports

[47] The defendant’s position is that as the owner of a property adjacent to 1235 Bank Street, he is no different than are the owners, including the plaintiff, of other properties adjacent to or in the vicinity of 1235 Bank Street. They are all ‘victims’, with their respective properties contaminated by reason of a single source – the residue of the dry cleaning products used over time at 1235 Bank Street.

[48] Numerous experts’ reports with respect to the investigation of the condition and remediation of 1235 Bank Street and properties adjacent to or in the vicinity of 1235 Bank Street are appended as exhibits to the affidavits filed on this motion. The reports are dated as early as 2002. The experts’ reports included in one or both of the motion records delivered on this matter are as follows:

Oct. 2002 - John D. Paterson and Associates Limited: Phase 1-1 Environmental Site Assessment (Hillary and Huang affidavits)

Feb. 2009 - CRA report: Impact Delineation Program (Hillary and Huang affidavits)

Mar. 2009 - Golder report: Review of Report on Impact Delineation Program (Huang affidavit)

Jun. 2010 - CRA report: Remedial Action Plan (Huang affidavit)

Jun. 2010 - CRA report: In-Situ Chemical Oxidation Pilot Scale Test Results (Hillary and Huang affidavits)

Nov. 2010 - Golder report: Review of Summary of Site Characterization, Remediation Pilot Test and Remedial Action Plan (Hillary and Huang affidavits)

Aug. 2012 - Geosyntec Consultants report: Peer review of environmental investigations and remediation efforts (Hillary affidavit)

Sept. 2013 - CRA report: Proposed Groundwater Delineation Investigation – Revision 1 (Huang affidavit)

Jan. 2014 - Golder report: Cost Estimate for Remediation of 1255 and 1263 Bank Street (Hillary affidavit)

Jun. 2015 - Geosyntec Consultants: Memo from D. Reynolds to counsel for the plaintiff (Huang affidavit)

Jul. 2015 - Golder report: Opinion on Location of Possible Source Zone (Huang affidavit)

[49] From my review of the experts’ reports included in one or both of the motion records, I identified at least 20 other reports that are not included in the record before me. Those reports include the following:

May 2001 - Jacques Whitford Environmental Limited report: Phase II Environmental Site Assessment 1263-1265 Bank Street, Ottawa, Ontario

Feb. 2004 - CRA report: Soil and Groundwater Quality Investigation Report

May 2006 - Golder report: Review of Environmental Reports, VOC Impacts at 1255-1265 Bank Street, Ottawa, Ontario

Sept. 2006 - CRA report: Supplemental Work Program

Oct. 2006 - Golder Report: Review of CRA Supplemental Work Program, VOC Impacts at 1255-1265 Bank Street, Ottawa, Ontario

Dec. 2006 - CRA report: Update to Supplemental Work Program

Jun. 2007 - CRA report: Supplementary Soil and Groundwater Investigation Report

Jul. 2007 - Golder report: Review of CRA Supplemental Soil and Groundwater Quality Investigation Report, 1255-1265 Bank Street, Ottawa, Ontario

Aug. 2007 - Golder report: Work Plan for Soil Vapour Assessment, 1255-1265 Bank Street, Ottawa, Ontario

Aug. 2007 - Golder report: Indoor Air Sampling at 1255 Bank Street, Ottawa, Ontario

Feb. 2008 - CRA report: Impact Delineation PROGRAM, Proposed Scope of Work

Mar. 2008 - CRA report: Proposed Subsurface Investigation of Scope of Work, 1235 and 1255-1265 Bank Street, Ottawa, Ontario

Apr. 2008 - CRA report: Updated Proposed Scope of Work

Apr. 2008 - CRA report: Additional Update to Proposed Scope of Work

Jul. 2009 - CRA report: Proposed Work Plan and Schedule, Pilot Scale Test for In-Situ Chemical Oxidation and Sub-Floor Gas Monitoring, 1235-1255 Bank Street, Ontario

Jun. 2010 - CRA report: Remedial Action Plan

Dec. 2010 - Ministry of Environment (“MOE”): Internal memorandum

Jan. 2011 - CRA report: Response to MOE Technical Review of CRA and Golder Reports

Mar. 2011 - CRA report: Amended Remedial Action Plan

Jun. 2013 - CRA report: Proposed Groundwater Delineation Investigation, Fraser Hillary’s Ltd. 1235 and 1255-1263 Bank Street, Ottawa, Ontario

[50] It is possible that a number of these reports have no bearing on the issues raised in the pleadings and to be determined in resolving the claims against the defendant. However, without the benefit of oral evidence from the experts and the opportunity for counsel to cross-examine the experts, I am in the dark as to: a) the opinions expressed by the experts in these other reports; and b) the potential significance of their respective opinions to the issues to be determined in resolving the plaintiff’s claim against the defendant.

[51] As noted above and in keeping with the approach of MacPherson J. (as he then was) in Beatty, my review of the experts’ reports is:

a) On the basis that:

i) They demonstrate that the reports exist;

ii) There is evidence on the issues relevant to the claims based in negligence, nuisance, trespass, and statutory liability; and

b) For the limited purpose of establishing whether there is a genuine issue for trial.

[52] What follows in sections (a) through (i) below is a discussion of the opinions expressed by the various experts retained by the plaintiff and by FHL including the identification of questions arising from those opinions that contribute to my finding that there are genuine issues for trial with respect to all aspects of the plaintiff’s claim against the defendant.

a) 2002 – Environment Site Assessment

[53] In or about 2002, John D. Paterson and Associates Limited (“JDP”) is retained on behalf of the plaintiff to conduct an environmental site assessment. The assessment is limited to the properties described municipally as 1255 Bank Street and 1263 to 1265 Bank Street. In its report, JDP describe the “[land] use adjacent to the subject site”. JDP refer to Hillary’s Dry Cleaners as being north of the subject site; with an oil changing centre to the south, residential premises to the east, and commercial premises to the west of the subject site. JDP opine that, “The potential environmental impact of the neighbouring properties upon the subject site was considered to be moderate to high.”

[54] The environmental site assessment by JDP is with respect to “potential subsurface contamination or impact from the dry cleaning facility located on the adjacent property to the north”.[^3] A number of boreholes are completed for groundwater monitoring wells. Groundwater sampling and soil sampling are carried out. As part of the assessment JDP identifies, “groundwater flow to be in an easterly direction.”

[55] With respect to the environmental impact of the Dry Cleaners (the term used by JDP), JDP express the following opinion:

Tetrachloroethylene and trichloroethylene were identified in the soil and groundwater samples recovered from the boreholes and monitoring wells placed on the north portion of the subject site. These chemicals are commonly associated with dry cleaning fluids. Based on groundwater level readings from the monitoring wells, the general groundwater flow under the subject site appears to be flowing to the east. Based on these observations, the presence of tetrachloroethylene and trichloroethylene in the soil and groundwater are suspected to have originated from the dry cleaning facility, located on the adjacent property to the north.

According to Mr. Huang, the dry cleaning facility is now equipped with a self contained cleaning system. Based on this information, it is assumed that the contamination encountered on the subject site is residual. [Emphasis added.] [^4]

[56] JDP recommends remediation with respect to both soil contamination and groundwater contamination. With respect to the former, JDP says:

All impacted soil, including soil with minor traces of VOCs, should be removed from the site to avoid any further liability. Prior to undertaking this remediation program, the zone of contamination will have to be fully delineated and the suspected source of contamination confirmed (adjacent Hillary’s Cleaners). [Emphasis added.] [^5]

b) February 2009 – Conestoga-Rovers & Associates

[57] Conestoga-Rovers & Associates (“CRA”) is retained by FHL to complete an Impact Delineation Program “at and in the vicinity of” 1235 Bank Street and 1255 to 1263 Bank Street. CRA refers to the area which is the subject of the investigation as “the Site” or “the Property”. The figures (drawings) attached to the report identify that: a) the Site includes all of 36 Cameron Avenue; and b) at least one (and possibly two) of the boreholes is located on the portion of 36 Cameron Avenue adjacent to 1235 Bank Street.

[58] The work of CRA in completing the Impact Delineation Program is conducted under the partial supervision of representatives of Golder, the experts retained by the plaintiff.

[59] CRA concludes that the groundwater flow “is generally in an east-north easterly direction”. [^6] The highest levels of PCE (in excess of those permissible by the MOE) are found in the monitoring well located in the basement of the FHL building. Levels exceeding the allowable limit are also found in four monitoring wells to the northeast of the FHL building. CRA says that downgradient from these two zones, the PCE concentration is observed to decrease. One, and possibly two, of the four monitoring wells is located on 36 Cameron Avenue; one is located on 1255 Bank Street; and the other is located on 1235 Bank Street, immediately adjacent to the north edge of 1255 Bank Street.

[60] With respect to the quality of the groundwater, CRA expresses the following opinion:

Based on a review of the analytical data gathered from the 27 monitoring wells sampled in September 2008, two primary zones of groundwater impact were identified, including an area centered in the northeast of the 1235 Bank Street building and a second area surrounding the northern portion of the building at 1255 Bank Street. Based on the PCE isoconcentration contours generated from the September 2008 monitoring events, it is concluded that groundwater contaminated in excess of the MOE Table 3 criteria has migrated off-Site, onto the residential properties north of 1235 and 1255-1263 Bank Street. [Emphasis added.] [^7]

[61] The significance of the concluding sentence of the portion of the report quoted above is not clear to me. “The Site” as defined by CRA includes 36 Cameron Avenue. Yet that property is located “north of” 1255 Bank Street. Does CRA treat 36 Cameron Avenue as one of the off-site residential properties to which contaminated groundwater may have migrated? Or, by virtue of its definition of “the Site”, does CRA by implication include 36 Cameron Avenue with 1235 and 1255 to 1263 Bank Street as one of the properties from which contaminated groundwater may have migrated to the north? Are the answers to those questions relevant to the outcome of the plaintiff’s claims against the defendant?

[62] CRA also addresses the quality of the soil on the Site. The PCE soil impact observed in the northeast portion of 1235 Bank Street and the northwest corner of 1255 Bank Street, “Is likely related to small volume historical release(s) of dry cleaning fluids originating from 1235 Bank Street.” [^8] CRA also expresses the concern, “that impacted soils could be present on the residential properties located to the north of 1235 and 1255-1263 Bank Street.” [^9] Once again, I am left with the same questions as those set out in paragraph 61 above.

[63] In addition, CRA assesses potential remedial options for the Site. The remedial approach which CRA recommends is chemical oxidation, with a pilot scale test to be performed before a large scale remediation program of that kind is implemented.

c) March 2009 – Golder & Associates

[64] As noted above, Golder (an expert retained by the plaintiff) partially supervises the work done by CRA. Golder collects duplicate samples during the subsurface investigation completed by CRA. Relying on those samples and in response to the February 2009 report of CRA, Golder produces a report dated March 2009.

[65] Whereas CRA defines “the Site” to include 36 Cameron Avenue, in their March 2009 report, Golder identifies the subject properties as 1235 Bank Street and 1255 to 1263 Bank Street and refers to those properties as “the site”. Figure 1 of the report depicts the location of “the site”. The copy of the March 2009 Golder report appended as an exhibit to the plaintiff’s affidavit does not include Figure 1. I am therefore uncertain as to whether the graphic depiction of “the site” in Figure 1 is consistent with the text definition of that term.

[66] The Golder report includes a number of other Figures – diagrams of the location of monitoring wells, etc. – which are said to “illustrate [Golder’s] interpretation of the extent of the soil and groundwater contamination in the vicinity of the site.” I note that 36 Cameron Avenue is included in the properties depicted in these Figures.

[67] Critical to the defendant’s position on this motion is the submission that it is not until November 2010 that Golder makes reference to a “source zone” of dry cleaning contaminants at 36 Cameron Avenue. I find that submission to be in error. At page 3 of their March 2009 Golder report, the authors say:

The soil analytical results collected to date at the site indicate concentrations of PCE that are two to three orders of magnitude higher than MOE Table 3 standard in the immediate vicinity of Hillary’s Dry Cleaner at 1235 Bank Street, as shown in Figure 2. The elevated concentrations in the source zone appear to extend vertically from approximately 3.7 to 6.7 mgbs and are indicative of possible free phase PCE. [Emphasis added.]

[68] The term “the source zone” also appears at page 4 of the report, in the concluding paragraph under the heading of ‘Soil Quality Interpretation’:

In summary, the soil quality data collected to date clearly indicates that the identified PCE impacts are the result of spills that occurred, and/or may still be occurring at 1235 Bank Street (Hillary’s Dry Cleaners), and that free phase PCE may be present in the source zone at 1235 Bank Street. [Emphasis added.]

[69] By reference to Figure 2, “the source zone” is identifiable and appears to include a portion of 36 Cameron Avenue. Golder does not, prior to its use of the term “the source zone” at pages 3 and 4 of the report, define the term. Golder does not provide any explanation as to the significance of and/or difference, if any, between its use of the terms “the source zone” and “the source”.

[70] Is there a difference between “the source zone” as it appears in page 3 and “the source zone at 1235 Bank Street” [emphasis added] as it appears in page 4 of the report? If so, what is the significance of that difference in the context of liability for: a) the spread of the contaminants to the plaintiff’s properties; and/or b) remediation of the plaintiff’s properties and the costs associated with remediation?

[71] As I read the reports of the various experts, there is a difference in purpose between identifying “the source” of the contamination at the outset (i.e. as part of an environmental site assessment) and subsequently identifying “the source zone” for the purpose of remediation (determining the appropriate method, the properties to be involved in the process, et cetera). That difference in purpose, if it exists, may be significant to the outcome of the plaintiff’s claims against Mr. Hillary.

[72] Throughout the balance of the Golder report, references are made to “the source”, “the confirmed source”, “the upgradient confirmed source”, and “the only plausible source”: For example, at pages 3 and 4 of the Golder report, the authors express the following opinions:

Soil concentrations of PCE up to one order of magnitude above MOE Table 3 standard are present below the water table downgradient of the source (see Figure 2). The extent of the impacted soil appears to be fairly well delineated on the site, but off-site impacts are not well delineated (especially north-east of the site). Given the location of the identified PCE impacts to “Deep soil” (i.e. greater than 2 mbgs) we conclude that the deep soil impacts are the result of the subsurface transport of dissolved phase and possibly free phase PCE from the upgradient confirmed source.

The only soil samples collected above the water table with PCE concentrations above the MOE Table 3 standard were retrieved from boreholes … all located in or near the confirmed source of PCE impacts at 1235 Bank Street. None of the soil samples collected to date from above the water table on the properties downgradient of the confirmed source (1255 and 1263 Bank Street) were found to have PCE concentrations above the MOE Table 3 standard.

In our opinion, the only plausible source of PCE contamination in the area is the Hillary’s Dry Cleaner facility …

[73] The use by Golder of these additional ‘source terms’ is a contributing factor to my understanding that there is a difference between identification of the source of the contaminant as part of an environmental site assessment and the subsequent identification of the source zone for the purpose of remediation.

[74] Given that Golder defines “the site” as limited to 1235 Bank Street and 1255 to 1263 Bank Street, does the reference to “especially north east of the site” (as an “off-site area” in which impacted soil delineation is not well-documented) include 36 Cameron Avenue? The designation that Golder assigns 36 Cameron Avenue – as either a source of contaminants or a property to which contaminants have migrated from the source property – is unclear.

[75] Golder also addresses groundwater contamination and interpretation of groundwater quality:

[T]here is one source causing the groundwater plume in the overburden … The plume originates from the dry cleaner at 1235 Bank Street and extends towards the adjacent properties located approximately east to south-east from the dry cleaner. The variability of dissolved VOC concentrations observed within the plume likely reflects the temporal variability of VOC concentrations in the source zone, as well as aquifer heterogeneity and complex flow patterns across the site. [Emphasis added.]

[76] Golder does not explain the significance, if any, of the difference between “one source” and “the source zone” as these terms relate to: a) the identification of the source of contaminants; and/or b) the remediation process.

[77] In light of the defendant’s position that the opinions expressed by the experts retained on behalf of the plaintiff, Golder in particular, have ‘evolved’ over time, it is important to consider the ‘Statement of Limitations’ in the March 2009 Golder report:

The report … is based on information collected during our investigation; including information provided by others, our present understanding of the site conditions, and our professional judgment in light of such information at the time of this report …

The findings and conclusions of this report are valid only as of the date of this report. If new information is discovered in future work, including excavations, borings, or other studies, Golder Associates Ltd. should be requested to re-evaluate the conclusions of this report, and to provide amendments as required.

[78] I find nothing unusual in the Statement of Limitations. I take judicial notice of similar statements made in reports prepared by many different kinds of experts – medical, accounting, engineering, et cetera. A credible and impartial expert remains open to re-consideration of his or her original opinion if presented with information that is new or different from the information upon which the original opinion is based.

d) June 2010 – Pilot Test of Remediation Method

[79] In its March 2009 report, Golder is critical of the in-situ oxidization remediation method recommended by CRA in its February 2009 report. Golder recommends that the pilot test suggested by CRA be carried out under strict conditions. The pilot test receives the approval of the MOE in July 2009. CRA carries out the pilot test and in a report dated June 2010 sets out the results of the test. Based on the test results, CRA recommends proceeding with a full-scale in-situ oxidation program and provides a detailed outline of the program in a companion report also dated June 2010.

e) November 2010 – Golder & Associates

[80] Golder is asked to comment on the results of the pilot test and the continuing recommendation of CRA that remediation be carried out by way of in-situ oxidization. As emphasized by the defendant, Golder’s November 2010 report was prepared subsequent to:

a) The date on which David Hillary was examined for discovery in his capacity as a representative of FHL; and

b) The discovery by the plaintiff that David Hillary was and remains the owner of 36 Cameron Avenue.

[81] In its November 2010 report, Golder defines “the site” as including 1235 Bank Street and 1255 to 1263 Bank Street. Golder also refers to soil and groundwater sampling conducted by CRA at “the subject properties”. One of each of the monitoring wells and boreholes is located on the northwest side of 36 Cameron Avenue (adjacent to the property line between 36 Cameron Avenue and 1235 Bank Street). It therefore appears that 36 Cameron Avenue is not part of “the site”, but is one of “the subject properties”.

[82] In its November 2010 report Golder identifies the purpose of the report as providing comments on environmental activities and data interpretation presented in the previous CRA documents and discussion of the site remedial options. The emphasis of the November 2010 Golder report is on remediation. There is minimal text devoted to environmental site assessment.

[83] In identifying an appropriate method of remediation, Golder refers to “the source zone” and to “a source zone”:

The PCE concentrations measured in soil and groundwater at MW8-07, MW15-08 and MW17-08 are considered to be indicative of the possible presence of free phase PCE (Dense Non Aqueous Liquid (CNAPL)), thus constituting “a source zone”. These three locations are in close proximity to the Hillary’s Dry Cleaner at 1235 Bank Street.

The potential presence of DNAPL in the source zone plays a critical role in the on-going migration of contamination to the southeast and should be taken in consideration for the selection and design of remedial options for 1235 Bank St. and 36 Cameron Avenue. [^10] (Emphasis added)

[84] It is agreed as between the plaintiff and the defendant that the monitoring well referred to as “MW8-07” is located on the northwest side of 36 Cameron Avenue, adjacent to 1235 Bank Street. It is also agreed that monitoring wells MW15-08 and MW17-08 are located on 1235 Bank Street.

[85] Golder expresses the opinion that there is the potential for adverse impacts off-site and, as a result, adjacent property owners should be advised of the situation. Golder cautions that, “[if] the remediation effort only focuses on the site, future contaminant migration from surrounding properties to the properties at 1255 and 1263 Bank Street could occur.”

[86] Based on Golder’s definition of “the site”, it is possible to interpret their report to mean that the defendant falls within the category of the owners of “off-site” property (i.e. properties adjacent to 1235 and 1255 to 1263 Bank Street) who are to be: a) advised of the potential adverse impact to their properties by reason of the contaminants; and b) involved in the remediation process.

[87] As I interpret the November 2010 report, Golder’s opinion is that the remediation program must include 36 Cameron Avenue in order to prevent the continued migration of contaminants to 1255 to 1263 Bank Street. Does the inclusion of 36 Cameron Avenue in the proposed remediation program, in and of itself, support a finding that 36 Cameron Avenue is ‘a’ source or ‘the’ source (in the context of an environmental site assessment) of the contaminants affecting the plaintiff’s properties?

[88] Golder is specifically critical of CRA for its lack of clearly-defined objectives for the proposed remediation program:

At a minimum, remediation objectives should clearly define the remediation concentration target for all the contaminants of concern in both soil and groundwater, the area to be remediated (on-site and off-site properties) and the timeline to achieve the ultimate contaminant target concentrations and significant intermediate goals … We suggest that the 2009 MOE Table 3 Standards for residential property use be retained as the remedial target concentrations for the properties at 1255 and 1263 Bank Street based on their potential future land use. Residential property use standards should also be used for 36 Cameron Ave. and for the residential properties to the east.

[89] Based on my reading of the report, it is possible that the specific reference to 36 Cameron Avenue is not an indication that Golder is of the opinion that 36 Cameron Avenue is ‘a’ or ‘the’ source of the contaminants found on the plaintiff’s properties; rather it, like the “residential properties to the east” is to be included in the remediation program.

f) August 2012 – Geosyntec Consultants

[90] Counsel for the plaintiff retained Geosyntec Consultants “to provide a peer review of environmental investigations and remediation efforts at 1235 Bank Street and 1255 to 1263 Bank Street.” [^11] Geosyntec was asked to comment on the proposed method of remediation. In its report, Geosyntec defines “the site” as including 1235 Bank Street and 1255 to 1263 Bank Street.

[91] Geosyntec is critical of both Golder and CRA in a number of respects. Addressing the soil results, Geosyntec says:

There appears to be a prevailing misconception by most consultants of the meaning of laboratory results for soil analysis over the course of the project … There is a large focus on the use of soil analytical results to indicate large areas of the site are in exceedence of MOE Table 3 (2004) criteria. There appears to have been no attempt to show that the soil results are likely a fact of the presence of the dissolved PCE plume at that location …

It is important to realize that the majority of PCE soil exceedences reported in the various site investigation reports are not indicative of free phase PCE contamination. It is reasonable to assume that once the groundwater plume is remediated, the majority of soil at the site will no longer exceed MOE criteria. It should also be noted that the MOE 2004 criteria have since been updated, and all future comparisons should be to the updated soil criteria. [^12]

[92] With respect to the groundwater results, Geosyntec notes the similarities between the results, as interpreted by CRA and by Golder: “Both interpretations are similar, and indicate that the groundwater plume is sourced from the northeastern section of 1235 Bank Street, and extends at least to Riverdale Avenue. The axis of the plume is in general agreement with the interpreted groundwater flow direction.”

[93] As I interpret the Geosyntec report, for the purpose of remediation there is a significant difference – as relates to impact on off-site properties – between remediation of the source of the groundwater plume (1235 Bank Street) and remediation of impacted soil regardless of the location of that soil. It appears that addressing the source of the plume is the most critical step to be taken by way of remediation and prevention of any future migration of contaminants to both the soil and groundwater at the plaintiff’s properties. The difference, if any, between remediation of the source of the groundwater plume and remediation of impacted soil (regardless of the property on which the soil is located) may be relevant to the issues of liability, causation, and assessment of damages.

[94] As to identification of “the source zone”, Geosyntec is of the opinion that the lack of intrusive investigations to northeast, along the property boundary with 36 Cameron Avenue, represents a shortcoming in the conceptual scientific model with which CRA is working in making its recommendations with respect to remediation:

1. There is the potential that the source zone in the surficial unconsolidated sediments extends off-site to the northeast of 1235 Bank Street.

2. DNAPL which has migrated to the bedrock vicinity may migrate off-site to the northeast and find a pathway into the bedrock itself.

[95] Again, I understand that criticism to be in the context of delineation of the area to be remediated as opposed to delineation of ‘the’ source of the contaminants.

[96] Geosyntec presents a number of alternative methods of remediation for consideration. One such method is in-situ stabilization of source and enhanced bioremediation. In outlining that method, Geosyntec refers to the “[s]ource zone on 1235 and 1255 Bank Street”. In discussing a second alternative method, Geosyntec describes the source zone in the same way. Does this reference to 1255 Bank Street as part of “the source zone” assist the defendant in his argument that the inclusion of 36 Cameron Avenue in “the source zone” (by Geosyntec or any other expert) does not in and of itself support a finding of liability on the part of the defendant for the contamination of the plaintiff’s properties?

[97] In discussing the second alternative method of remediation, Geosyntec estimates the cost of the method if “limited to options which are intended to remediate both the source and the downgradient impacted properties”. Geosyntec notes that “the Golder cost estimates are based on a different set of assumptions, the most notable being remediation of the residential properties to the northeast to MOE Table 3 residential standards.” Once again, is Geosyntec differentiating between 1235 Bank Street as “the source” and 36 Cameron as one of either the downgradient impacted properties or the residential properties to the northeast? If so, is that differentiation relevant only for the purpose of remediation or is it also relevant to the identification of “the source” of the contaminants on the plaintiff’s properties?

[98] Geosyntec concludes its report stating, “We trust that this letter meets your current needs and provides you with a better understanding of the remedial options for 1235-1263 Bank Street.”

g) 2014 – Geosyntec Associates

[99] In a letter addressed to counsel for the plaintiff, Geosyntec provides “[a] preliminary estimate and technical outline for planning, management, and execution of source zone soil remediation activities at 1235 Bank Street, 1255 Bank Street, and 36 Cameron Avenue, Ottawa, Ontario (“the Site”)”. For the first time, Geosyntec includes 36 Cameron Avenue in its definition of “the Site”. Is the inclusion of 36 Cameron Avenue in Geosyntec’s definition of “the Site” because the specific focus of the letter is soil remediation (described above as “source zone soil remediation”)?

[100] Geosyntec explains that concentrations of volatile organic compounds above the MOE criteria have been found in “soils beneath the water table across the majority of the Site and adjacent properties to the east and southeast.” As to the source of the contaminants:

The main source of the PCE contamination at the Site is located beneath 1235 Bank Street. The property is an active dry cleaning facility. Free phase PCE is suspected to have migrated from 1235 Bank Street onto the adjacent 1255 Bank Street property. A dissolved phase plume is known or suspected to have migrated from the region of the source zone downgradient and is potentially impacting the residential properties to the northeast, underlying bedrock, and also 1263 Bank Street. [^13]

[101] Is the use by Geosyntec of the term, “the main source” of significance in light of the use of other ‘source’ terms throughout the earlier CRA, Golder, and Geosyntec reports?

[102] The method of remediation recommended by Geosyntec is an in-situ chemical oxidation (ISCO) to address the contaminated soils “within the primary source area at the Site.” Geosyntec introduces yet another term – “the primary source area”. Is there any significance to the use of that term as opposed to any of the other ‘source’ terms?

[103] The remediation program proposed by Geosyntec will, if followed, require that the dry cleaning facility at 1235 Bank Street and the residential structure at 36 Cameron Avenue be demolished. They will need to be disposed of at an approved off-site facility. The suggested “target footprint” for the ISCO approach is noteworthy. The target footprint is 700 m² and based on the PCE in soil exceedences measured in: a) the northeastern portion of 1235 Bank Street; b) the southern portion of 36 Cameron Avenue; and c) the northwestern portion of 1255 Bank Street.

h) 2015 – Geosyntec Consultants

[104] In a memorandum prepared at the request of and addressed to counsel for the plaintiff, Geosyntec provides “clarification of portions of the report (Geosyntec 2012) concerning the potential for a second source of contamination, other than a possible contiguous source identified as present beneath … the eastern corner of 1235 Bank Street, the northern corner of 1255 Bank Street, and the southern corner of 36 Cameron Avenue.” The term “contiguous source” is not defined in the memorandum. What is the significance, if any, of the use of that term as opposed to other ‘source’ terms in the context of: a) identification of the source of the contaminants; and b) the remediation process?

i) July 2015 - Golder

[105] In July 2015, at the request of counsel for the plaintiff, Golder prepares a report in which it provides “an opinion regarding whether or not the available soil and groundwater data indicate the possible presence of a source of groundwater contamination at 36 Cameron Avenue East.” This report is dated subsequent to the date of service of the defendant’s motion record for the motion for summary judgment.

[106] In the 2015 letter, Golder defines “a source zone [to be] a mass of contaminant in the subsurface that produces groundwater contamination.” [^14] Golder also provides an explanation as to how groundwater contamination occurs:

When “clean groundwater flows through a source zone, the contaminant dissolves, or is otherwise released to the groundwater, and thus creates a plume of groundwater contamination which extends downgradient from the source zone (in the direction of groundwater flow). A source can be a chemical in liquid phase (i.e. a separate liquid in the soil or rock), it can be adhered (called “sorbed”) to soil or rock, or it can be dissolved in the portion of the pore-water of soil or rock that is immobile. All of these types of sources can produce plumes of groundwater contamination. [^15]

[107] Golder expresses the opinion that the data/results from the various monitoring wells, “indicate that there is a source zone producing the plume of groundwater contamination that extends from northwest to southeast across the above referenced properties and also extends to other properties located to the northeast and southeast.” [^16] In the summary opinion set out at the conclusion of its 2015 letter, Golder says:

Because MW8-07 is located on 36 Cameron Avenue East and MW15-08 is located on 1235 Bank Street, it is our opinion that the source zone is most likely present below both 1235 Bank Street and 36 Cameron Avenue East. The nature of the source zone (whether it is composed of separate phase chemical, sorbed phase chemical, dissolved phase chemical in the pore-water of soil or rock, or some contamination of these) would require additional investigations to determine. However, despite the lack of information regarding the nature of the source zone, it is reasonable to interpret that the source zone is, at minimum, below both of these properties. [^17]

[108] The defendant relies on the use by Golder of the phrase “most likely” in support of his position that the opinion expressed does not support a finding on the basis of a balance of probabilities that “the source zone” is located at least in part below 36 Cameron Avenue. The use of the phrase “most likely” is not a sufficient basis upon which to conclude that there is no evidence upon which to base the findings of fact required to support the plaintiff’s claims against the defendant.

Summary

[109] A determination on the issue of the potential liability of the defendant rests, at least in part, on: a) a comprehensive understanding of the opinions expressed by the experts whose reports are before me; and b) findings of fact based on those opinions. Only with the assistance of the oral evidence of the expert witnesses, tested on cross-examination, will it be possible to make the findings of fact required to resolve the plaintiff’s claims against the defendant.

[110] The issues for which the benefit of oral testimony is required are not discreet. Those issues are relevant to the majority, if not all, of the alleged bases of liability and potentially to the issue of the assessment of damages to which the plaintiff may be entitled from FHL and the defendant.

The Statement of Claim

[111] The allegations against FHL and David Hillary based in negligence, nuisance, trespass, and statutory liability are set out in the amended statement of claim dated March 25, 2011. The original and the amended statement of claim include claims based in ‘strict liability’. However, on the return of the motion, counsel for the plaintiff advised that the plaintiff is not pursuing that aspect of his claim. Set out below are the paragraphs from the amended statement of claim (“the pleading”) relevant to the four remaining alleged bases of liability on the part of FHL and David Hillary:

1. For over four decades, chemicals and wastes associated with the dry cleaning operation have been delivered to and used, transferred, stored, and disposed of at the Defendant Hillary’s Property and the Defendant David Hillary’s Property, and have spilled, leaked, been deposited or otherwise escaped into the soil and groundwater.

2. As a result, Contamination is present in the soil and groundwater at the Defendant’s Property and the Defendant David Hillary’s Property, which has migrated and continues to migrate onto the Plaintiff’s Properties.

3. At all material times, the Defendant Hillary’s owned the Defendant Hillary’s Property and Hillary’s and David Hillary had management and control of the chemicals and dry-cleaning wastes which caused the Contamination of both the Defendant’s Property, the Defendant David Hillary’s Property, and the Plaintiff’s Properties.

4. Further studies undertaken by Golder Associates for the Plaintiff and Conestoga Rovers & Associates for the Defendants have better delineated the extent of the Contamination on both the Plaintiff’s Properties and the Defendants’ Properties.

5. The additional work undertaken by both parties confirms that one of the sources of soil and groundwater contamination on the Plaintiff’s Property is the Defendant Hillary’s Property. It has further been confirmed that there is soil and groundwater contamination present on the Defendant David Hillary’s Property which has migrated and continues to migrate onto the Plaintiff’s Property.

Causes of Action

6. The Defendants knew or ought to have known of the Contamination of the soil and groundwater at the Defendant Hillary’s Property and the Defendant David Hillary’s Property, and the likelihood that this Contamination would and did escape off-site and affect the Plaintiff’s Properties.

7. The ongoing Contamination of the Plaintiff’s Properties by Contaminants from the Defendant Hillary’s Property and the Defendant David Hillary’s Property constitutes an actionable nuisance.

8. The ongoing Contamination of the Plaintiff’s Properties constitutes trespass for which the Defendants are responsible at law.

9. The contamination of the Plaintiff’s Properties resulted from the negligence of Hillary’s, and the negligence of its employees and agents, in particular:

(a) in failing to exercise due care in the storage, use and disposal of chemicals used, and wastes produced, in the operation of a dry cleaning business;

(b) in dumping, placing, spilling or allowing chemicals and wastes to escape into the natural environment;

(c) in failing to adopt reasonable measures to prevent, report, respond to and remediate spills and discharges;

(d) in failing to regularly monitor, test and inspect their storage and use of chemicals and wastes;

(e) in failing to adequately train and/or supervise the employees, agents and contractors responsible for the care and management of chemical wastes;

(f) in failing to remediate all known and suspected Contamination on a timely basis; and

(g) in failing to make all reasonable and necessary changes to their operations to prevent and abate the escape and migration of Contamination;

(h) in failing to take adequate and timely measures to address the known Contamination at the Defendants’ Properties, and to ensure that such Contamination did not migrate to adjacent lands; and

(i) in failing to remediate any Contamination caused or permitted at the Defendants’ Properties, and at adjacent lands.

10. In undertaking investigation and remediation of the Defendants’ Properties, the Defendants owe a duty of care to affected third parties, including the Plaintiff, to address off-site migration of Contaminants.

The portions of the pleading which are underlined reflect the amendments made in 2011 when David Hillary was added as a defendant to the action.

a) Negligence

The allegations of negligence as against David Hillary are poorly particularized in the pleading. Sub-paragraphs 21(a) to (e) and 21(g) deal with the dry cleaning operation run by FHL at 1235 Bank Street. It is possible that only sub-paragraphs 21(f), (h), and (i) and paragraph 22 are relevant to the claim in negligence against David Hillary. In essence the plaintiff alleges that once David Hillary knew or ought to have known of the presence of the Contamination (the plaintiff’s term) of the plaintiff’s properties, he had a duty of care to the owners of the adjacent properties to address same. The plaintiff alleges that David Hillary has failed to fulfil that duty in a timely manner or at all.

[112] In response to that element of the plaintiff’s claim, the defendant’s position is that:

a) If dry cleaning contaminants are present at 36 Cameron Avenue, the contaminants were present in 1986 when he purchased the property. Nothing the defendant did, in his personal capacity as the owner of the property, contributed to the presence, if any, of the contaminants at 36 Cameron Avenue;

b) It was not until November 2009, when the March 2009 Golder report was produced in the litigation, that the defendant was aware of any suggestion (the defendant’s term) that 36 Cameron Avenue could be ‘a’ source of the contaminants affecting the plaintiff’s properties;

c) When the experts reports are read collectively, they do not support a finding based on a balance of probabilities that the plaintiff’s properties are contaminated by reason of dry cleaning contamination originating from 36 Cameron Avenue; and

d) The plaintiff and FHL had, by the fall of 2009, retained experts to address the delineation of the source of the contaminants and a remediation program. In addition, the Ministry of the Environment was involved as of that point. If the defendant owes a duty of care to the plaintiff, which the defendant denies, he has met the standard of care. In measuring the defendant’s conduct consideration must be given to his physical and financial capacity. It is reasonable for the defendant to rely on the experts to delineate the source of the contaminants and determine the remediation program to be pursued.

[113] In his affidavit, the defendant sets out in detail the dry-cleaning process and chemicals used, waste management process followed, and garbage collection method used by FHL until the 1970’s. The defendant’s evidence in that regard is not contradicted and, based on the submissions made on behalf of both the plaintiff and the defendant, does not appear to be contentious.

[114] With respect to a claim based in negligence, consideration must be given to the existence of a duty of care and, if such a duty is found to exist, the standard of care to be met in fulfilling that duty. The defendant did not file any evidence on this motion as to the standard of care to be met by an individual in these circumstances. He simply argues that he has acted reasonably by relying on FHL to hire experts and deal with the plaintiff in working towards completion of a remediation program.

[115] I find that the outcome of the plaintiff’s claim in negligence is tied to a comprehensive consideration of the expert opinions as they relate to: a) the existence of a duty of care on the part of the defendant towards the plaintiff; b) the standard of care to be met; c) whether the defendant met the standard of care; d) causation; and e) assessment of damages arising from the negligence, if any, of the defendant. There are clearly genuine issues that need to be determined at trial.

b) Nuisance

[116] The defendant’s position in response to the plaintiff’s claim against him in nuisance is based in larger part on the discussion in Klar, Tort Law, 3d ed. (Toronto: Carswell, 2003). At pages 656 – 657 of that text the author addresses the subject of ‘Continuing or Adopting a Nuisance’:

However, unlike the situation of an individual who deliberately engages in an activity which constitutes a nuisance, the law’s treatment of an occupier who in some way inherits a nuisance is considerably more sympathetic. The liability of a person who occupies property on which a nuisance, or potential nuisance, which was created by a previous owner, a trespasser, an act of nature or a latent defect in a property, is discovered, is essentially a matter not of strict liability, but of negligence law. In a series of English decisions, it was determined that an occupier of land has a duty only to take reasonable steps to abate a nuisance, or a potential nuisance, discovered on the occupied land, where the occupier did not create the nuisance or continue it by use. Liability is predicated on actual or constructive knowledge of hazardous condition and the occupier’s lack of reasonable care in responding to it. In view of the fact that the hazardous condition was thrust upon an innocent occupier, a more lenient duty of care than that ordinarily imposed by negligence law has been laid down. The Defendant’s particular circumstances, including the financial and physical capacity to abate the nuisance will be considered.

[117] The defendant’s position recognizes that the status of the defendant as ‘victim’ or ‘offender’ and, if the latter, when he became an ‘offender’ is relevant to the determination of the plaintiff’s claim against the defendant in nuisance. For the reasons set out above in my review of the experts’ reports there is clearly a genuine issue requiring a trial of the action with respect to the plaintiff’s claim against the defendant in nuisance.

c) Trespass

[118] The plaintiff’s position is that the migration of contaminants from 36 Cameron Avenue to the plaintiff’s properties constitutes a continuing trespass. The defendant’s position is that the only defendant potentially liable to the plaintiff in trespass is FHL as ‘the’ source of the contaminants affecting the plaintiff’s properties.

[119] The parties are in agreement that “trespass” is defined as set out in Canadian Tire Real Estate v. Huron Concrete Supply Ltd., 2014 ONSC 288; 45 R.P.R. (5th), a case relied on by the plaintiff. Trespass is, at paragraph 18, therein defined as:

Any voluntary, direct and physical intrusion onto a plaintiff’s land is an actionable trespass and such intrusions include the discharge of a substance onto the plaintiff’s land. (Gatta Homes Inc. v. St. Catharines (City) (2009), [2009] O.J. No. 5058, 49 CELR (3d) 202 at para. 210).

[120] Once again, the status of the defendant as ‘victim’ or ‘offender’ and, if the latter, when he became an ‘offender’ may be relevant to the determination of the plaintiff’s claim against the defendant in trespass. If the defendant is a ‘victim’, can it be said that migration of contaminants from 36 Cameron Avenue to the plaintiff’s properties amounts to a “voluntary” intrusion onto the plaintiff’s properties? The answer to that question may depend on the findings based on the experts’ opinions with respect to the manner and extent to which contaminants migrated from 1235 Bank Street to 36 Cameron Avenue and the plaintiff’s properties. For the reasons set out above in my review of the experts’ reports, there is clearly a genuine issue requiring a trial of the action with respect to the plaintiff’s claim against the defendant in trespass.

d) Statutory Liability – The Environmental Protection Act

[121] The plaintiff’s responding motion record does not include an affidavit from a representative of the Ministry of the Environment. Appended to the plaintiff’s affidavit are a series of documents with respect to the involvement of the Ministry of the Environment.

[122] The documents appended as exhibits to the plaintiff’s affidavit include an order dated July 2014 setting out “Compliance Dates” by which FHL and David Hillary are to take or complete certain steps. The steps identified are with respect to assessment, monitoring, mitigation and/or remediation of the contamination of the soil and groundwater at “the Source Property, Commercial Property and, if inferred to be present, the Adjacent Property.” These terms are defined in the related MOE documents:

“Adjacent Property” includes 36 Cameron Avenue and means privately-owned residential and/or commercial properties including but not necessarily limited to those within the block bounded by Riverdale Road, Bank Street and Cameron Avenue and/or properties on the west side of Bank Street, north side of Cameron Avenue and east side of Riverdale Road, excluding the Source Property.

“Commercial Property” means privately-owned commercial use property immediately adjacent to and abutting 1235 Bank Street, including 1255 Bank Street, City of Ottawa PIN #041300211.

“Source Property” means 1235 Bank Street, City of Ottawa PIN#041300210.

[123] References are made in the MOE documents to “D. Hillary” and he is, in at least some of the documents, identified as the owner of 36 Cameron Avenue and therefore the person in charge, management, and control of that property. However, it is not clear the extent to which “D. Hillary” is referred to in his capacity as a representative of FHL versus in his capacity as the owner of the Adjacent Property. It is not clear, on the face of the MOE documents alone, that “D. Hillary” is identified in his personal capacity as an individual who is required to comply with the July 2014 order.

[124] For that reason and given the issues arising from the experts’ reports, the potential liability of the defendant on the basis of statutory liability is a genuine issue for trial.

Issue No. 2: Mini-Trial Appropriate?

[125] The defendant submits that it is appropriate in the circumstances of this case to proceed with a mini-trial with respect to whether or not the property at 36 Cameron Avenue is a source of the contaminants affecting the properties at 1255 to 1263 Bank Street. For the following reasons, I find that the interests of justice would not be served by proceeding with a mini-trial on that issue:

• As noted above, I find that issue to be part of the “fabric of the case as a whole”. That issue is so intrinsically tied to the determination of other issues requiring a trial of the action that it should not be isolated and determined discreetly.

• The majority, if not all, of the evidence at the mini-trial would have to be repeated at the main trial. As a result, efficiency and cost-effectiveness would not be achieved by proceeding with a mini-trial.

Issue No. 3: Other Orders

[126] I have considered the directions and terms that I might order pursuant to subrule 20.05(2) of the Rules of Civil Procedure. If I were inclined to make any order as to directions it would be to require that a statement setting out what material facts are not in dispute be filed within a specified time. It appears that the facts with respect to the use by FHL of PERC and the manner in which it historically disposed of PERC filters and sludge are not disputed. As a result, some trial time might be saved by having an agreed statement of facts filed for the purpose of trial. However, for the following reasons, I find that it would not be appropriate to make such an order:

• The trial of the action is scheduled to proceed within approximately three weeks. Counsel time is best-devoted to preparation for trial as a whole. The counsel time required for three parties to agree on a statement in that regard likely exceeds the court time to be saved if an agreed statement of facts is filed.

• The evidence with respect to FHL’s historical use and disposal of PERC will be given by David Hillary who will be required to testify in any event.

• It is beneficial for the trial judge to hear oral testimony as to the historical use and disposal of the PERC in making the findings of fact required including those based in part on the evidence of the experts.

[127] At paragraph 78 of her decision in Hyrniak, Karakatsanis J. directed that “in the absence of compelling reasons to the contrary, [the motion judge] should also seize herself of the matter as the trial judge.” There are, in the matter before me, “compelling reasons” as to why I do not remain seized of the matter.

[128] First, the matter is scheduled to proceed to trial on January 18, 2016 for three weeks. I am, on that date, scheduled to hear the continuation of a trial which was commenced in August 2015. Therefore, if I were to remain seized of the matter, it would be necessary to adjourn the trial to another date.

[129] Second, having dismissed the motion for summary judgment, there are no issues to be ‘carried over’ from the summary judgment motion to the trial of the action. The plaintiff’s claims remain to be determined without any reference to my decision on the motion for summary judgment.

[130] Third, there is no ‘efficiency’ to be gained by my remaining seized of the matter. The purpose for which I reviewed and became familiar with the experts’ reports is distinct from the purpose for which the evidence of the experts will be considered at the trial of this action.

Conclusion

[131] For the above reasons:

1. The motion by David Hillary for summary judgment is dismissed; and

2. The action shall proceed to trial as scheduled on January 18, 2016.

Costs

[132] If the plaintiff and the defendant are unable to resolve the issue of costs of the summary judgment motion, I direct that the party seeking costs deliver written submissions to my office within 60 days of the date of release of this Ruling. The responding party is to deliver written submissions within 80 days (i.e. an additional 20 days) of the date of release of this Ruling. The written submissions are: a) to comply with Rule 4 of the Rules of Civil Procedure; and b) are not to exceed three pages, excluding the bill of costs and costs outline.

[133] I have set 60 and 80 days from the date of release of this ruling for the costs submissions appreciating that in the next four weeks the parties are best served with their counsel focussed on preparation for trial. The additional work involved in preparation of written costs submissions would serve as a distraction to that important preparatory work.

DATE: December 22, 2015

Justice S. Corthorn

OTTAWA COURT FILE NO.: 07-CV-39359

DATE: 2015/12/22

ONTARIO

SUPERIOR COURT OF JUSTICE

B E T W E E N:

EDDY HUANG

Plaintiff

– and –

FRASER HILLARY’S LIMITED and DAVID HILLARY

Defendants

RULING ON MOTION FOR SUMMARY JUDGMENT

Justice S. Corthorn

Released: December 23, 2015

[^1]: See page 21 of the February 2009 report of CRA. [^2]: See page 5 of the March 2009 report of Golder. [^3]: See page 22 of the October 2002 report of John D. Paterson and Associates Ltd. [^4]: See page 26 of the October 2002 report of John D. Paterson and Associates Ltd. [^5]: See page 27 of the October 2002 report of John D. Paterson and Associates Ltd. [^6]: See page 13 of the October 2002 report of John D. Paterson and Associates Ltd. [^7]: See page 33 of the October 2002 report of John D. Paterson and Associates Ltd. [^8]: See page 32 of the October 2002 report of John D. Paterson and Associates Ltd. [^9]: See page 33 of the October 2002 report of John D. Paterson and Associates Ltd. [^10]: See pages 2 and 3 of the November 2010 report of Golder Associates. [^11]: See page 1 of the August 2012 report of Geosyntec Consultants. [^12]: See pages 7, 8 and 10 of the August 2012 report of Geosyntec Consultants. [^13]: See page 1 of the January 2014 letter from Geosyntec to Beament Green. [^14]: See page 1 of the July 16, 2015 letter from Golder Associates addressed to Beament Green. [^15]: See page 1 of the July 16, 2015 letter from Golder Associates addressed to Beament Green. [^16]: See page 2 of the July 16, 2015 letter from Golder Associates addressed to Beament Green. [^17]: See page 2 of the July 16, 2015 letter from Golder Associates addressed to Beament Green.