British Columbia Court Acquits Shipping Company for Marine Pollution Incident

Written by Jacob Jerome Gehlen and Rick Williams, Borden Ladner Gervais LLP

Introduction

On April 8, 2015, the M/V Marathassa (the “Marathassa”) discharged an unknown quantity of intermediate fuel oil into Vancouver’s English Bay. The event triggered a large-scale response, coordinated under the leadership of the Canadian Coast Guard, which removed the vast majority of oil within three days. Shoreline clean-up continued for weeks, and at least 20 migratory birds were affected.

The Crown brought criminal charges against the vessel owner, Greece-based Alassia NewShips Management Inc. (the “Owner”) and the vessel itself. In total, the Marathassa was charged with 10 pollution-related offences. The Owner did not face trial on any of the charges, as the British Columbia Court of Appeal ruled it had not been properly served with a summons. In two decisions in 2018, the British Columbia Provincial Court acquitted the Marathassa of six of these offences.

Clean-up Operations in Vancouver’s English Bay after the MV Marathassa discharged fuel (Source: https://pbs.twimg.com/media/Dy1OP0PW0AEvCb2.jpg)

On February 7, 2019, the Provincial Court gave its final judgment in the case and held that the Marathassa had successfully made out a due diligence defence for the remaining charges (R. v. MV Marathassa, 2019 BCPC 13).

This decision is significant for its discussion of the due diligence defence in the context of marine pollution.

The Decision

The remaining charges were the environmental offences of discharging a pollutant, discharging a substance that is harmful to migratory birds, failing to implement aspects of a shipboard pollution emergency plan, and failing to contain the discharged oil. All of these charges are strict liability offences, and the Crown needed only prove the acts which are the subject of the offences.

The Court found that the discharge was caused by two shipbuilder defects on the vessel. The two defects were not foreseeable to the owner or the crew and were only discovered after the leak was traced back to the area of the defects. The defects were also not foreseeable to the external auditors of the shipbuilding or to Transport Canada Inspectors. A foreign object had somehow entered a valve, preventing proper closure. The leaky valve allowed fuel oil to enter a cargo hold. During the cargo hold washing process, water was used to clean the hold and then pumped out of the hold and into the water. This process created the pollution.

Having established that the events occurred, the Court then examined the Marathassa’s defence of due diligence.

The Court noted that the Marathassa had extensive pollution prevention systems in place and had conducted careful crew selection, comprehensive spill response training, and numerous inspections. The Marathassa had been declared seaworthy by auditors and Transport Canada, and had only been operating for a few weeks at the time of the incident. Marathassa had a mistaken, honest, and reasonable belief that the vessel was seaworthy to the highest international standards.

The Marathassa was found not-guilty of all charges.

Implications

The decision serves as a useful summary of some of the steps necessary to establish a due diligence defence in the maritime pollution context, and the proper elements of “reasonable care” with regards to pollution prevention.

The decision has been criticised as demonstrating that legislative reform is needed to ensure that ship owners and vessels are held directly and criminally accountable for pollution-related offences regardless of the due diligence defence. However, to date, no such legislation has been introduced to take away the due diligence defence.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.


About the Authors

Jacob Jerome Gehlen is an associate in the Insurance and Tort Liability Group at the Vancouver office of Borden Ladner Gervais LLP. He assists clients with a variety of civil litigation matters, with an emphasis on tort liability, environmental law, insurance defence and maritime law. He has appeared before the Supreme and Provincial Courts of British Columbia.

Rick Williams is a partner in the Vancouver office of Borden Ladner Gervais LLP. He is the National Leader of the Environmental Law group and the Regional Leader of the Regulatory and Oil and Gas groups. Rick regularly represents and advises clients on the commercial, regulatory and litigation aspects of project development, permitting and operations in the energy and natural resource sectors, including land, environmental and Aboriginal issues.  Rick also represents and advises clients on dispute resolution including regulatory proceedings, corporate/commercial litigation and arbitration, with a particular focus on the areas of oil and gas, transportation, forestry and mining.

Managing Environmental Risk through Brownfield Programs When Buying or Leasing Real Property in the United States

Written by Brooke F. Dickerson, Arnall Golden Gregory LLP

American environmental laws can be daunting for a foreign investor. For example, both federal and state laws can impose strict liability, which is liability regardless of fault or intent, on the owner or tenant of a contaminated property, which is sometimes called a “brownfield property.” Such liability could lead to the imposition of penalties, the obligation to perform cleanup work, the duty to reimburse another party for its damages, or the restriction of use of the property itself, even if the contamination occurred prior to the acquisition or lease of the property or if the contamination was not caused by the owner or tenant. There are certain compliances that need to be met if you’re a property owner of a normal building, let alone a contaminated property. Property managers need to make sure the building is compliant with regulations for that industry. They use software to keep track of the reporting and archiving of tasks, find out more about property compliance platform here if you’re interested. The owner/property manager needs to ensure contaminations are dealt with and compliant or will be penalized. However, there are various methods that an entity can use to limit or avoid such liability, as well as unexpected costs, time, expenses and possibly reverse phone lookup checks. A purchaser or incoming tenant of property that could be contaminated can protect itself by performing due diligence and availing itself of one or more of these methods.

One method frequently used to manage environmental liability is participation in a “Brownfield Program.” Brownfield programs provide liability protection and other benefits to a purchaser or new tenant of real property and have been adopted by several states. Generally, brownfield programs require that a party apply for acceptance either prior to or within a short time after acquiring a property interest. Both the property and the applicant must qualify under the particular criteria for that program. In the state of Georgia, for example: (1) the property must have a preexisting release of a hazardous substance but it cannot already be subject to cleanup requirements under other environmental laws; and (2) the applicant must not be a person who contributed to the contamination or have a close relationship with a person who contributed to the contamination, and the applicant must not be in violation of any environmental order or law. The applicant must agree to adequately assess the environmental conditions of the property, if not already done, and to address any releases that exceed regulatory clean up levels; the proposed assessment and remediation work are submitted in the application as part of a proposed corrective action plan. Finally, the applicant must certify to the agency that it has achieved its corrective action plan tasks after all the work is completed.

In return, an applicant will receive a “Limitation of Liability” under the brownfield law for all of the contaminants that it assessed and/or addressed. The limitation of liability is usually granted as soon as an application is approved, conditioned on the full performance of the corrective action plan. The limitation of liability becomes final upon approval of the applicant’s certification of compliance. The scope of a limitation of liability varies by state, but usually will include protection against any claim by the government for additional cleanup as well as by a third party, such as a neighboring property owner.

Participation in a brownfield program provides several other advantages as well. Remediation requirements can be reduced according to the specific intended use of the property and likely risks of exposure to human health or the environment. A residential use will require a more strict clean up than an industrial use; consequently, the cost to clean up property for an industrial plant will be much less than the costs to clean up property to be a housing development. A prospective purchaser or tenant will have a good estimate of how much it will have to spend and how much time it will take to address environmental problems before it acquires the property, enabling better budgeting and cost evaluation. A very important benefit is that the brownfield limitation of liability runs with the land, which means that the protections pass from the initial applicant to all subsequent owners and tenants of the property. Existing brownfield protection is a significant advantage when marketing the property if and when the owner wants to sell or re-lease it.

As with the extent of liability protection, other brownfield benefits can also vary state by state. Using the Georgia program as an example, a purchaser or new tenant in the brownfield program is excused from having to address any groundwater contamination (which is often the most costly type of remediation work), and the corrective action plan can be performed autonomously, only requiring governmental involvement when the entity submits its final certification of compliance with the corrective action plan. Not being required to obtain governmental approval at various milestones will save the owner or tenant significant time in completing the project.

Many states also offer tax benefits. The Georgia brownfield program incorporates property tax abatements up to the amount of eligible brownfield costs incurred. Eligible brownfield costs include almost all expenses related to assessing the property, working with consultants, cleaning up the property, preparing and submitting all required documentation and finalizing the limitation of liability; legal fees and true construction costs are not eligible. In essence, a new property owner or tenant can get reimbursed for all of its environmental costs through tax savings and still recoup the brownfield liability protection, limitation and certainty of expenses and time, and marketing benefits for resale.

In sum, a potential purchaser or tenant might want to give a contaminated property a second look. Such an investment may yield greater returns than locating on a clean property. So if you’re looking for new property to invest in, whether clean or contaminated, you may want to think about getting cash for your house in Seattle.

This article has been republished with the permission of the authors. It was first published on the AGG website.


About the Author

Brooke F. Dickerson focuses her practice on transaction, regulatory, compliance and permitting matters. With regards to environmental work, she has significant experience with Superfund (CERCLA), hazardous waste (RCRA and HWMA), the Georgia Hazardous Site Response Act (HSRA), solid waste, Brownfields, wetlands, and site evaluation, assessment and remediation issues. She also advises clients on stormwater compliance, green leasing issues and green/sustainable building practices. With regards to construction work, Ms. Dickerson advises owners and developers on the drafting and negotiation of architect, construction and construction management agreements. She has represented clients in connection with the construction of office, multi-family, mixed use and tenant improvement projects. She also advises clients on OSHA matters and has represented several companies in obtaining reduced or dismissed penalties in settlement negotiations.

Ontario Government Budget & the Environment

Written by John Nicholson, M.Sc., P.Eng., Editor

The Ontario government recently issued its budget for the 2019 fiscal year.  The budget was considered in some circles as not favouring the environment. One environmental activist organization went as far as calling it ““the most anti-environmental budget in Ontario” since Mike Harris was in power in the 1990’s.

For starters, the government cut $300 million from the budget for the Ontario Ministry of Environment, Conservation, and Parks. The cuts
from that Ministry’s budget come from the end of programs funded by the cap-and-trade system, as well as the cancellation of the Drive Clean program for passenger vehicles.

If one looks closely enough at the budget, there was some good news to professionals that work in the environmental sector, including the following:

  • A province-wide climate vulnerability assessment.  The Government will assess the best science and information to better understand where the province is vulnerable and understand which regions and economic sectors are more likely to be impacted.  Such an assessment is typical in the insurance industry and major companies.  The findings from the assessment will feed into the Province’s Climate Plan announced in November 2018.
  • Clean technology incentives.  The Government has taken steps to encourage private investments in clean technologies. Through the Ontario Job Creation Investment Incentive, the Province is paralleling the Federal Government in allowing businesses to immediately write off investments made in specified clean technology capital equipment. This incentive will make investments in clean energy generation and energy conservation equipment more attractive.
  • Industrial emissions performance standards.  The Government is currently developing emissions performance standards for industries to achieve further greenhouse gas reductions.  When the new standards are promulgated in a regulation, each industrial facility will be required to demonstrate compliance annually.

The budget included these and other sections that are encouraging indications the the Ontario government understands that value of the environmental and cleantech industries.

Environmental Liability Risk Faced by Directors of Dissolved Companies – Getting around the Gehring Defence

Written by Una Rodaja, Harper Grey LLP

Once upon a time, you were a director of a company that owned a parcel of land in the Greater Vancouver area.  A dry-cleaner and an auto-repair shop operated on the property, but you were not too concerned about environmental liability.  This was the 80s after all and the rent was good!  Your tenants caused some environmental contamination, which you addressed when your company sold the site in 1990.  You dissolved your company a year later and forgot all about it.

The property is now owned by a developer who is seeking to build a residential tower on the property.  To do so, the developer is required to investigate and remediate contamination that remained on the property after your company sold it.  Standards have changed and the limited remediation your company did years ago no longer meets the applicable standards.  Your old tenants (both sole proprietorships) are long gone and the developer is seeking to hold you personally liable for the costs of remediation.  You did not personally operate on or own the property, so are you really at risk?  A recent BC Supreme Court case says you are.  Here we explain how and why.

Directors of existing corporations are “responsible persons”

Under BC’s Environmental Management Act[1], a director or officer of a company that owns or operates on, or has historically owned or operated on, a contaminated site is a “person responsible for remediation” of that site simply by virtue of their position with the company.[2]  Such directors and officers can be liable to pay reasonable costs of remediation incurred by anyone in respect of the site owned or operated on by their company, if they authorized, permitted or acquiesced to the activity that gave rise to the cost of remediation.[3]

Directors of dissolved corporations are not “responsible persons”

Although the language establishing the categories of “responsible persons” under BC law is very broad, it is not without limit.  For example, it does not include “persons” who have ceased to exist, such as dissolved corporations.  This was made clear by the BC Supreme Court in a seminal decision called Gehring[4].  The case has undoubtedly motivated many corporate dissolutions by directors and officers seeking to shield themselves from personal liability for contaminated sites owned or operated on by the companies they served.

Dissolved companies can be restored – then what?

However, in the recent decision of the BC Supreme Court in Foster v. Tundra Turbos Inc.[5], a director of a long-dissolved corporation that owned and operated on contaminated land faced exposure in an action to recover environmental remediation costs by virtue of an application to restore the company to the corporate registry.  The company in question, Tundra Turbos Inc., was incorporated in 1978, and was dissolved in 2000.  Prior to its dissolution, it had a single director, one Mr. Clarke. The Plaintiff sought to hold Mr. Clarke liable for the costs of remediation incurred in respect of the property, some 17 years after Tundra had dissolved.  The question before the court was whether it was appropriate to restore Tundra and reconstitute Mr. Clarke’s directorship to make it possible for Tundra and Mr. Clarke to be liable for the costs incurred by the Plaintiff in remediating the property owned by Tundra in the late 1980s and early 1990s.  Tundra and Mr. Clarke presented several arguments against the restoration, including that Mr. Clarke would lose the Gehring defence, a substantive right, and that Tundra’s records pertaining to its operations at the property were destroyed, given the length of time involved.  The court rejected these arguments and ordered the restoration.

In the court’s view, there was nothing inherently unfair in the fact that companies and directors may be exposed to liability under BC’s environmental legislation many years after their association with a contaminated property ended.  Further, the right of a company and its directors to avoid liabilities for which they would have been exposed but for the dissolution is not the kind of right protected by legislation.  In fact, a legitimate purpose of restoring a company is to facilitate the imposition of such liabilities.  While destruction of the dissolved company’s records may, in certain circumstances, result in the court rejecting an application to restore, in Tundra’s case there was no prejudice arising from the loss of records because it was clear, on the facts, that had Tundra not been dissolved, it would have been responsible for the costs of remediation.  If anything, the lost records caused more prejudice to the Plaintiff than Tundra’s director, Mr. Clarke, who had personal knowledge of Tundra’s activities on the site.

In addition, the fact that Mr. Clarke could potentially face personal liability even without Tundra being restored (on the basis that he personally had the right to control, was in control of or responsible for any operation on the site in question) did not have a bearing on the restoration application.  The court recognized that it was easier to hold Mr. Clarke liable if he was responsible solely by virtue of his status as director, which could only be done if the company was restored.

Implications of the Tundra Decision

The Tundra case is an important example of creative counsel work to get around the Gehringdefence.  However, notwithstanding the outcome in that case, there are arguments to be made in future cases to avoid the restoration and, ultimately, responsible persons status for the director in question.  Existence of a limitation defence and loss of evidence that would assist in the defence of the director in question, or unreasonable delay of the Plaintiff in bringing the restoration application, may well result in the application being denied.

For lawyers advancing cost recovery claims, the Tundra case is a good reminder of the need to look at dissolved corporations and their directors and officers, and the need to apply for restoration, in a timely fashion.  For those defending these claims, and restoration applications, finding prejudice, beyond the mere loss of the Gehring defence, will be key.

[1] S.B.C. 2003, c. 53 (“EMA”)

[2] EMA, ss. 39(1), 45

[3] EMA, ss. 47(5); Contaminated Sites Regulation, s. 35(4)

[4] Gehring v. Chevron Canada Ltd., 2006 BCSC 1639, para. 55

[5] Foster v. Tundra Turbos Inc., 2018 BCSC 563

About the Author

Una Rodaja is a partner in Harper Grey’s Commercial Litigation and Environmental Regulation & Disputes practice groups. Una frequently lectures on various aspects of contaminated sites law for the Pacific Business and Law Institute, BC Environmental Industry Association, the Environmental Managers Association, and the BC Continuing Legal Education Society.  She is the co-author of BC Environmental Management Legislation and Commentaryand the recipient of the 2017 Lexpert® Leading Lawyers Under 40 award. Una is recognized by the 2018 Canadian Legal Lexpert® Directory as a Leading Lawyer to Watch in the area of corporate commercial litigation and by Benchmark Canada® as a Future Litigation Star. She has also been recognized by Best Lawyers® in Canada 2019 as a “Leading Lawyer in the area of Environmental Law.

Nature based solutions for contaminated land remediation and brownfield redevelopment in cities: A review

A collaboration of researchers from various Universities from around the world recently published a research paper in Science of the Total Environment that reviews nature based solutions for contaminated land remediation. The paper contends that Nature-based solutions (NBS) including phytoremediation and conversion of brownfield sites to public greenspaces, holds much promise in maximizing a sustainable urban renaissance.

The researchers claim that urban industrialization has caused severe land contamination at hundreds of thousands of sites in cities all around the world, posing a serious health risk to millions of people. The also state that many contaminated brownfield sites are being left abandoned due to the high cost of remediation.

Traditional physical and chemical remediation technologies also require high energy and resource input, and can result in loss of land functionality and cause secondary pollution.

NBS is an umbrella concept that can be used to capture nature based, cost effective and eco-friendly treatment technologies, as well as redevelopment strategies that are socially inclusive, economically viable, and with good public acceptance. The NBS concept is novel and in urgent need of new research to better understand the pros and cons, and to enhance its practicality.

The review article summarizes NBS’s main features, key technology choices, case studies, limitations, and future trends for urban contaminated land remediation and brownfield redevelopment.

United States: U.S. EPA Takes Action Under TSCA Identifying Chemicals For Agency Scrutiny

Written by by Lawrence E. Culleen, Arnold & Porter

Prioritization of Chemicals

In its continuing quest to meet regulatory deadlines imposed by the 2016 amendments to the Toxic Substances Control Act (TSCA), the United States Environmental Protection Agency (U.S. EPA) has published a list of 40 chemicals that must be “prioritized” by the end of 2019. The announcement marks the beginning of the Agency’s process for designating the 40 listed chemicals identified as either “high” or “low” priority substances for further the U.S. EPA scrutiny. At the conclusion of the prioritization process, at least 20 of the substances likely will be designated as high priority.

A high priority designation immediately commences the U.S. EPA’s formal “risk evaluation” procedures under the amended statute. The risk evaluation process can lead to “pause preemption” under the terms of the 2016 amendments and new state laws and regulations restricting the manufacture, processing, distribution, and use of a chemical substance undergoing a risk evaluation could not be established until the evaluation process is completed. The U.S. EPA commenced its first 10 risk evaluations as required under the amended law at the close of 2016. The Agency is required to have an additional 20 risk evaluations of high priority substances ongoing by December 22, 2019. If the U.S. EPA’s risk evaluation process concludes that a substance presents an “unreasonable risk” to health or the environment under its “conditions of use,” the Agency must commence a rulemaking to prohibit or limit the use of the substance under Section 6 of TSCA.

The Agency’s announcement of the list of chemicals to undergo prioritization provides the makers and users of the listed substances an important, time limited opportunity to submit relevant information such as the uses, hazards, and exposure for these chemicals. The U.S. EPA has opened a docket for each of the 40 chemicals and the opportunity to submit information for the U.S. EPA’s consideration will close in 90 days (on June 19, 2019). The U.S. EPA will then move to propose the designation of these chemical substances as either high priority or low priority. The statute requires the U.S. EPA to complete the prioritization process, by finalizing its high priority and low priority designations, within the next nine to 12 months.

The list of 20 substances to be reviewed as high priority candidates consists entirely of substances previously identified by U.S. EPA in 2014 as “Work Plan” chemicals. Thus, the list contains few chemicals that should be considered complete “surprises.” However, the inclusion of formaldehyde may raise concerns in certain quarters given the scrutiny that has been given to the U.S. EPA’s previous struggles with assessing the potential effects of formaldehyde. The Agency has attempted to address these concerns by stating “Moving forward evaluating formaldehyde under the TSCA program does not mean that the formaldehyde work done under IRIS will be lost. In fact, the work done for IRIS will inform the TSCA process. By using our TSCA authority EPA will be able to take regulatory steps; IRIS does not have this authority.” Also included in the listing are several chlorinated solvents, phthalates, flame retardants, a fragrance additive, and a polymer pre-curser:

  • p-Dichlorobenzene
  • 1,2-Dichloroethane
  • trans-1,2- Dichloroethylene
  • o-Dichlorobenzene
  • 1,1,2-Trichloroethane
  • 1,2-Dichloropropane
  • 1,1-Dichloroethane
  • Dibutyl phthalate (DBP) (1,2-Benzene- dicarboxylic acid, 1,2- dibutyl ester)
  • Butyl benzyl phthalate (BBP) – 1,2-Benzene- dicarboxylic acid, 1- butyl 2(phenylmethyl) ester
  • Di-ethylhexyl phthalate (DEHP) – (1,2-Benzene- dicarboxylic acid, 1,2- bis(2-ethylhexyl) ester)
  • Di-isobutyl phthalate (DIBP) – (1,2-Benzene- dicarboxylic acid, 1,2- bis-(2methylpropyl) ester)
  • Dicyclohexyl phthalate
  • 4,4′-(1-Methylethylidene)bis[2, 6-dibromophenol] (TBBPA)
  • Tris(2-chloroethyl) phosphate (TCEP)
  • Phosphoric acid, triphenyl ester (TPP)
  • Ethylene dibromide
  • 1,3-Butadiene
  • 1,3,4,6,7,8-Hexahydro-4,6,6,7,8,8-hexamethylcyclopenta [g]-2-benzopyran (HHCB)
  • Formaldehyde
  • Phthalic anhydride

The U.S. EPA has signaled that it has received a manufacturer request for a EPA to undertake a risk evaluation of two additional phthalates which, if administrative requirements for such request have been met, the Agency would announce publicly in the very near term.

The 20 low priority candidate chemicals were selected from the U.S. EPA’s “Safer Chemicals Ingredients List”—a list of substances previously evaluated and considered to meet the U.S. EPA’s “Safer Choice” criteria for use in certain common product categories, such as cleaning products.

Other Recent and Impending U.S. EPA Actions Under TSCA

Given the numerous deadlines that are looming under the amendments to TSCA, it is critical that chemical manufacturers and processors of chemicals and formulations remain aware of the recent and upcoming actions under TSCA that can significantly impact their businesses. The following provides a short list of important actions of which to be aware.

Active/Inactive TSCA Inventory Designations. EPA released an updated version of the TSCA Inventory in February 2019. The Inventory is available for download here. This version of the Inventory includes chemical substances reported by manufacturers and processors by their respective reporting deadlines in 2018. The updated TSCA Inventory (confidential and non-confidential versions) includes 40,655 “active” chemical substances and 45,573 “inactive” chemical substances. Once the current 90-day “transition period” has concluded, it will be unlawful to manufacture, import or process in the US any substance that is listed as “inactive” without first providing notice to the U.S. EPA. Thus, prior to the expiration of the “transition period” on May 20, 2019, manufacturers and processors of chemical substances that are not listed as active on the February 2019 TSCA Inventory must take steps to activate the substance by filing a Notice of Activity (NOA Form B) for any chemical substance that they currently are manufacturing or processing, or anticipate manufacturing or processing within 90 days of submission.

Final TSCA Section 6(a) for Methylene Chloride in Paint and Coating Removers. EPA has released its long-awaited TSCA Section 6(a) rule restricting the use of methylene chloride in paint and coating removers. The final rule prohibits the manufacture, processing, and distribution of methylene chloride in paint removers for consumer use. The rule prohibits the sale of methylene chloride-containing paint and coating removers at retail establishments with any consumer sales (including e-commerce sales). The U.S. EPA declined to finalize its determination that the commercial use of methylene chloride-containing paint and coating removers presents an unreasonable risk. Therefore, distributors to commercial users, industrial users, and other businesses will continue to be permitted to distribute methylene chloride-containing paint and coating removers. However, given recent efforts by store-front retailers to “deselect” such products for consumer sales, it remains unclear how distributions to commercial users can or will occur.

The U.S. EPA simultaneously released an advanced notice of proposed rulemaking related to a potential certification program for commercial uses of methylene chloride-containing paint and coating removers. The U.S. EPA has similar programs in place for certain pesticides and refrigerants, and the United Kingdom currently has in place a program to certify commercial users of methylene chloride-containing paint and coating removers. The U.S. EPA is seeking comment on whether a certification program is the appropriate tool to address any potential risks that could be posed by the commercial use of methylene chloride-containing paint and coating removers.

Upcoming Draft Risk Evaluations. The U.S. EPA is expected to publish within days or weeks the highly anticipated draft Risk Evaluations for the remaining 9 of the 10 initial substances to undergo TSCA Risk Evaluations under the amended law and which have been under review since December 2016. The Agency will accept comments on the drafts for a limited period.

Proposed Rules for 5 PBT substances. The U.S. EPA is required to issue no later than June 2019 proposed TSCA Section 6 regulations for 5 persistent, bioaccumulative and toxic (PBT) substances that were identified during 2016 as priorities for regulatory action. The Agency must propose expedited rules intended to reduce exposures to the extent practicable.


*Camille Heyboer also contributed to this Advisory.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

About the Author

Lawrence Culleen represents clients on administrative, regulatory, and enforcement matters involving federal agencies such as the U.S. Environmental Protection Agency (EPA), the US Department of Agriculture, the US Food and Drug Administration, and the Consumer Product Safety Commission. Mr. Culleen has broad experience advising clients on US and international regulatory programs that govern commercial and consumer use chemicals, pesticides and antimicrobials, as well as the products of biotechnology and nanoscale materials. Prior to joining the firm, Mr. Culleen held significant positions at EPA serving as a manager in various risk-management programs which oversee pesticides, chemical substances, and biotechnology products.

United States: When Is Property Damage From A Release “Expected Or Intended”? Only After The Owner Learns Of The Spill And Ignores It

Written by Seth JaffeFoley Hoag LLP

Any good trial lawyer will tell you that the law is about telling stories.

Once upon a time, Timothy and Stacy Creamer bought a house.  Only after they closed did they realize that some strategically placed rugs were hiding the evidence that, “up from the ground come a bubblin’ crude.”

Unlike Jed Clampett, rather than finding themselves millionaires, the Creamers found themselves with a million dollar liability – literally.

This being a law story, of course the sellers were bankrupt.  The Creamers thus pursued the sellers’ insurer.  The case ended up in the Appeals Court, which held that the Creamers could pursue their claims under the policy.

The insurer, Arbella, made three arguments in support of its summary judgment motion.  The Court rejected them all.  In order, the Court held that:

  1. The property damage was caused by an occurrence.  Arbella argued that the damage was caused by the sellers’ fraud, not by the original release of oil.  However, as the Court pointed out, the Creamers’ had claims based on Chapter 21E, the Commonwealth’s superfund law.  Since Chapter 21E is a strict liability statute, the Creamers’ damages were caused by the release, not by the sellers’ fraud.  (But see number 3, below!)
  2. The loss occurred during the policy period.  Following precedent, the Court concluded that, so long as the property damage occurred during the policy period, it did not matter that the harm to the claimant did not occur until later.
  3. At least some of the damage was not “expected or intended.”  This is the most significant part of the case.  While preserving Creamers’ claims, the Court split the baby on this one.  It held that the original release was not expected or intended, but that, once the sellers discovered the spill without doing anything about it, any further damage was “expected” by the seller.  The Court thus remanded for a determination by the Superior Court how much of the total property damage was “expected.”

The Creamers will thus get their day in court, but, depending on when the sellers learned of the contamination, their recovery could be significantly limited.  They certainly will not get enough to move to Beverly Hills.  No swimming pools or movie stars for the Creamers.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

About the Author

Seth Jaffe is recognized by Chambers USA, The Best Lawyers in America and Massachusetts Super Lawyers as a leading practitioner in environmental compliance and related litigation. He is one of the authors of the Law and the Environment Blog, www.lawandenvironment.com, which provides real-world perspectives on current developments in environmental law and regulation. Seth is a past President of the American College of Environmental Lawyers.

Seth works on a wide range of environmental law issues, representing clients in the permitting/licensing of new facilities and offering ongoing guidance on permitting and enforcement related matters under federal and state Clean Air Acts, Clean Water Acts, RCRA, and TSCA. He also advises on wetlands and waterways regulation. Seth’s clients include electric generating facilities, companies in the printing and chemical industries, and education and health care institutions.

Yukon’s Contaminated Site Mapped Online

The Government of Yukon Territory recently posted an online map that shows all known contaminated sites in the Territory.

Map of Contaminated Sites in Yukon

To access the contamination history of properties in the territory, one can visit the online map. This information was previously only available to the public on request.

Properties considered contaminated and included in the map are ones that have the confirmed presence of substances such as petroleum hydrocarbons and metals above specific concentrations. The Government of Yukon claims that many contaminated locations pose no risk to the public. However, in an effort to be transparent, it has created the online map.

The map is based on information the Government of Yukon receives and maintains. There are approximately 529 sites recorded by the Government of Yukon on the contaminated sites map. Of these sites 207 are considered contaminated, 151 are unknown and 171 are remediated.

Indigenous and Northern Affairs Canada Map of Contaminated Sites in the Yukon, 2012

The Yukon Minister of the Environment, Pauline Frost stated in a press release, “This online tool will help increase the health and safety of communities across Yukon, support remediation efforts and help prevent future instances of contamination through greater public awareness. It is an example of our commitment to openly sharing information that is important to Yukoners and making it as accessible as possible.”

Other Canadian Jurisdictions

The federal government has a searchable federal contaminated sites inventory. The Federal Contaminated Sites Inventory includes information on all known federal contaminated sites under the custodianship of departments, agencies and consolidated Crown corporations as well as those that are being or have been investigated to determine whether they have contamination arising from past use that could pose a risk to human health or the environment. The inventory also includes non-federal contaminated sites for which the Government of Canada has accepted some or all financial responsibility. It does not include sites where contamination has been caused by, and which are under the control of, enterprise Crown corporations, private individuals, firms or other levels of government.

According to information compiled by Ecosense in 2018, contaminated site registry systems are in place in 76% of provinces and territories within Canada. This may include contaminated sites that are apart of a stand alone or another property listing system. Provinces and territories that have a registry include: Alberta, British Columbia, Manitoba, Yukon, Quebec, Ontario, North-West Territories, Newfoundland, and Prince Edward Island. However, the degree of information shared within these listings vary extensively. For example, Ontario’s database includes records of site condition (RSC) which entails detailed information of the type of contaminants at a site, contaminant concentrations, as well as information on the phases of environmental site assessments (ESA) completed, the date of site closure and company involved (PIRI, 2014). In contrast, Manitoba’s database provides only a file number, company name, city and address on an impacted sites list. No details of a site’s contamination levels, information concerning the degree of contamination or site remedial status is provided (PIRI, 2014).

Provinces within Canada that provide and inventory on contaminated sites that is available for public access include from west to east: Yukon (YK), British Columbia (BC), North West Territories (NT), Alberta (AB), Manitoba (MN), Ontario (ON, Quebec (QC), Prince Edward Island (PEI) and Newfoundland and Labrador (NL).

In addition, more than half (58%) of the provinces in Canada record contamination over the area of a property (based on property specifics) versus recording contamination over an area (area wide). Contamination doesn’t tend to stick to the boundaries of property lines, therefore inventories that record entries based on property specifics will not accurately represent the breadth or extent of contamination within a given area (PIRI, 2014). Provinces that record area-wide contamination are BC, NT, and NB. Many registries also do not include site information that track the process of assessment or cleanup. AB (only if submitted to the department), BC, YK, QC, and NB keep track of site progress.

Tesla Fire Is A Reminder For Businesses Storing Hazardous Materials

Written by Dawn DeVroom, IDR Environmental Services

fire broke out on Saturday, February 17 at Tesla’s car plant in Fremont, California. This isn’t anything new, because we do hear about businesses that have fires from time to time.

But, what makes this fire different is that it happened in an area where the company stores some of its hazardous materials outside. And, because of this, Tesla was forced to call the local Fremont Fire Department and required a hazardous materials unit.

According to reports, Tesla has a history of fires at this facility. This includes a fire in their paint shop in April 2018 and another outdoor fire in August 2018.

Add to this, Tesla was already under investigation by Cal-OSHA cited in January and fined $29,000 for allegedly violating six different worker safety regulations in their general assembly 4 (GA4) production line.

According to the Silicon Valley Business Journal:

“Tesla allegedly didn’t obtain a building permit or inspect the tent for safety violations, train workers on how to get out of the building in an emergency, or protect themselves from heat illness. Cal-OSHA also claims the tent had exposed metal rods and rebar that workers could potentially impale themselves on, and failed to cover a hole in the floor that was 22 inches wide, 14 inches wide and 8 inches deep.”

Suffice it to say…this fire isn’t helping Tesla’s safety record with OSHA.

So, what can businesses who store hazardous materials do to avoid Tesla’s potential catastrophe with that fire. Here are some very important things you should do.

Store Hazardous Waste In Proper Containers

storing hazardous materials

As a hazardous waste generator, you must satisfy safety, environmental and regulatory guidelines and have a solid base of knowledge and experience in using and handling hazardous materials in your facility.

Using the right storage containers for different types of hazardous waste is the key to safety and compliance. All hazardous waste generators must insure that their containers are built to specification according to the most current codes and regulations.

Following is a list of the different types of hazardous waste storage containers according to the Environmental Protection Agency website.   

  • Containers – portable device in which hazardous waste is stored, transported, or otherwise handled.
  • Tanks – stationary device of man-made materials used to store hazardous waste, either open or closed.
  • Drip Pads – wood drying structure used by the pressure treated wood industry to collect excess wood preservative and drippings.
  • Containment Buildings – completely enclosed self-supporting structures used to store or treat non-containerized hazardous waste.
  • Waste Piles – open, uncovered pile used for treating or storing hazardous waste.
  • Surface Impoundments – a natural topographical depression, man-made excavation or diked area such as a holding pond, storage pit or settling lagoon.

Proper storage and disposal requires you to understand which materials are toxic, what they do, the types of containers needed for storing the material and the type of personal protective equipment (PPE) that must be used.

You can learn more about which container is right for you waste by reading our article, How To Choose The Right Hazardous Waste Storage Container.

Label Hazardous Waste Correctly

Identification of properties and the regulatory status of waste that you generate is vital in maintaining compliance with state and federal regulations.

Hazardous waste generators that accumulate hazardous waste on-site in containers must be aware of the Resource Conservation and Recovery Act (RCRA) regulations regarding the proper labeling, marking and placarding requirements for hazardous waste containers.

The California Department of Toxic Substances Control (DTSC) provides the following guidance for the proper labeling requirements for California hazardous waste generators as outlined in Title 22, California Code of Regulations (Cal. Code Regs.):

  • Date – The date upon which each period of accumulation begins must be clearly marked and visible for inspection on each accumulation unit.
  • Hazardous Waste Notice – Each generator tank or container must be labeled or clearly marked with the words, “Hazardous Waste”.
  • Name and Address – Name and address of the generator.
  • Composition and State – Chemical composition (chemicals in the waste) and physical state of the waste (e.g. solid, liquid, etc.)
  • Properties of Waste – Statement or statements that call attention to the particular hazardous properties of the waste (e.g. flammable, reactive, etc.)
  • Accumulation Dates – If waste is collected or consolidated in containers or tanks, the initial date of the accumulation must be marked, as well as the “90-day or 180-day period” dates, whichever applies to your company. If waste from an older container is added, the initial accumulation date will need to be changed.
  • Recurring Waste Labels – “Recurring use” labels may be used on containers where same waste streams are initially collected and emptied into larger accumulation containers. The labels can revise the initial accumulation and “90-day period” dates (without having to change the other labeling information). If the container is emptied at least once each day, the word “daily” may be used in the date area of the label. 

You can learn more in our article, How To Properly Label Hazardous Waste Containers.

Prepare a Hazardous Waste Contingency Plan

According to federal and state regulations, every hazardous waste generator is required to have an emergency contingency plan. This plan outlines the company’s program to minimize hazards to human health and the environment from fires, explosions or an unplanned sudden release of a hazardous waste.

Failure to implement a plan can lead to hefty fines with the California Department of Toxic Substances Control (DTSC) and the Environmental Protection Agency (EPA)

Your Hazardous Waste Contingency Plan should include:

Small Quantity Generators (SQG’s)

  • Designate an emergency coordinator and post contact information
  • Post the location of emergency equipment
  • Post emergency telephones
  • Ensure employees are familiar with emergency procedures

Contingency Plan Requirements for Large Quantity Generators (LQG’s)

  • Create a written plan on-site and make sure the it is up-to-date and reviewed frequently
  • Designate an emergency coordinator(s) and post contact information
  • Post the location of emergency equipment
  • Post emergency telephones
  • Create an emergency evacuation plan
  • Ensure employees are familiar with emergency procedures
  • List name, address and phone number (s) (home and office) for designated emergency coordinator
  • Submit written plan to local authorities

You must maintain at least one copy of the contingency plan at the facility, but multiple copies is even better. In addition, copies must be submitted to local police departments, fire departments, hospitals, and state and local emergency response teams that may provide emergency services to the facility.

Even if a facility will be providing its own responders, the contingency plan should still be sent to appropriate authorities in the local community in case of an off-site release or major emergency that requires their assistance.

You can read more about how not having a hazardous waste contingency plan affected another company in our article, No Hazardous Waste Contingency Plan Leads To Big Fine For Manufacturer.

Consider a HazMat Emergency Response Team

storing hazardous materials

The risks of working with hazardous substances and generating hazardous waste are great, and the consequences of a release, fire or spill can be dire.

Many companies choose to outsource their emergency response as an alternative to training, equipping and maintaining an emergency response team in-house. And, some companies will have more than one company at their disposal to ensure availability when an event occurs.

Emergency response companies have a fully-staffed, fully-trained hazmat emergency response team that are available 24 hours a day, 365 days per year.

It is important to establish a relationship in advance to allow for fast response times, with experienced supervisors who coordinate with all responsible agencies (such as local fire and rescue) to limit liability and costs.

Whether you need to control a situation or stop a potentially dangerous one, having an outside HazMat emergency response team provides the following benefits:

  • Save Lives
  • Protect Property
  • Preserve the environment
  • Limit Liability

You can learn more about using a HazMat emergency response team in our article, What A HazMat Emergency Response Team Can Do For Your Business.

Final Thoughts

Tesla serves as an example of what could happen to companies that use, generate and require storage of hazardous materials. Although nothing serious happened in Tesla’s recent fire, it could be much worse for your company if you don’t have the above procedures in place.

If you need assistance with putting together your program, contact a hazardous materials company that specializes in helping companies create and maintain their program.


About the Author

Dawn DeVroom is the CFO at IDR Environmental Services based in California. The company specializes in hazardous waste disposal.

What are the core requirements of wide area CBRNe training?

Written by Steven Pike, Argon Electronics

When you are required to conduct wide area emergency preparedness training – be it in the setting of a chemical, biological, radiological, nuclear, and explosive (CBRNe) school, a dedicated military center or an industrial facility – the ongoing challenge for any CBRNe instructor is to be able to create a scenario that is realistic, safe, reliable and cost effective.

Trainees need to be equipped with the practical knowledge and skills to respond with confidence to an enormous variety of potential live incidents. And each threat brings with it a unique set of practical, physical and psychological tasks that need to be ‘experienced’ in order to be understood.

So what is the recommended approach to help instructors implement a realistic but safe CBRNe training environment?

Overcoming regulatory obstacles

While the spreading of chemical simulants can still occasionally be an option, strict environmental regulations generally make it unfeasible – and the use of any form of radiological source is almost always going to be unrealistic for all but the most high specialized of training facilities.

Simulant training also brings with it the problem of being very location-dependent, which restricts the ability to create scenarios in public settings or confined spaces. And there is the added difficulty of it not being able to be readily integrate simulant training with other conventional live training methods.

Wide-area instrumented training systems

When the highest degree of realism is required, a powerful modular exercise control system such as PlumeSIM enable instructors to take their CBRNe training exercises to an entirely new level. And it especially comes into its own in the context of counter terrorism scenarios, nuclear training drills and HazMat emergency exercises.

So what benefits does the PlumeSIM training system offer?

Portability – Plume-SIM is highly portable making it quick to set up and to use in any environment. The inclusion of a planning mode also means that instructors can easily prepare exercises on a laptop or PC without the need for any form of system hardware.

Realism – Students are equipped with simulators and GPS enabled players, to enable them to take part in large area exercises that can include sequential multi-threat releases or that integrate with third-party live training systems.

Instructor control – The instructor retains complete control of the exercise including the ability to decide the type, quantity, location and nature of the source.

Environment – Specific environmental conditions can also be easily defined by the user, including temperature and changes in wind direction.

Repeatability – The Plume-SIM’s exercise parameters can be saved so the identical scenario can be repeated as many times as required.

Real-time action -The trainees’ movements, progress and instrument usage can be monitored in real time from a central control station.

After action review – The recording of student activity in real-time provides useful after action review (AAR). This can be used to encourage discussions about the effectiveness of an exercise and to facilitate further improvements.

Data capture – All recorded exercise data can also be exported and emailed to external personnel for future analysis.

Pre-exercise capability – The table-top planning mode uses standard gamepad controllers which enables trainees to undertake pre-exercise practice to take place within the classroom environment. The exercise can also be recorded and analysed prior to heading for the live field training area.

Versatility – If environmental conditions preclude the ability to obtain or maintain continuous long-range radio communication then the scenario can be pre-loaded on the player unit for timed activation.

Compatibility – The Plume-SIM system is compatible with a wide variety of simulator equipment including the M4 JCAD-SIMCAMSIMAP2C-SIMAP4C-SIMRDS200-SIMEPD-Mk2-SIMAN/PDR-77-/VDR-2 and RDS100-SIM.

Room to grow – The modular system gives instructors the flexibility to expand their range of training equipment as and when their budgets allow.

Achieving the highest level of realism in CBRNe training is paramount – and assuring personnel safety will always be key.

A flexible, modular simulator-based training solution such as the PlumeSIM system can provide trainees with the opportunity to practice and perfect their response to a wide variety of highly-realistic simulated threats in a completely safe environment.


About the Author

Steven Pike is the Founder and Managing Director of Argon Electronics, a leader in the development and manufacture of Chemical, Biological, Radiological and Nuclear (CBRN) and hazardous material (HazMat) detector simulators. He is interested in liaising with CBRN professionals and detector manufacturers to develop training simulators as well as CBRN trainers and exercise planners to enhance their capability and improve the quality of CBRN and Hazmat training.