NOVEMBER 2010
ENVIRONMENTAL LAW ALERT
SYNCRUDE SENTENCED $3 MILLION
FOR WATERFOWL FATALITIES
In April 2008, a late spring snowstorm resulted in the diversion of ducks from their
flyway to a tailings pond (Aurora Pond) near Fort McMurray, Alberta, operated by
Syncrude Canada Ltd. (Syncrude). The ducks landed on Aurora Pond and were killed
by the toxicity of the pond. Syncrude was charged with two offences related to the
deaths of 1,606 waterfowl: failing to store a hazardous substance in a manner that
ensured that it did not come into contact with any animals, contrary to s. 155 of the
provincial Environmental Protection and Enhancement Act (Alberta) (EPEA); and,
depositing a substance harmful to migratory birds in an area frequented by migratory
birds, contrary to s. 5.1(1) of the federal Migratory Birds Convention Act (Canada)
(MBCA), a charge usually used to regulate bird hunting.
Over the course of a nine week trial, the Crown
argued that migratory birds use the Aurora Pond
every year, which is the reason why Syncrude
typically installs sound cannons to deter birds from
landing on Aurora Pond. Syncrude stated that the
storm prevented it from installing these cannons.
Syncrude further argued that the charges
brought against it were inappropriate as
environmental legislation generally prohibits
hazardous substances from being released into
the environment. However, there was no release
in these circumstances because the hazardous
substances (mainly bitumen) were contained
within the Aurora Pond. Syncrude also argued
that the Aurora Pond was licensed by the Alberta
Government and as a result the provincial
Government authorized the Aurora Pond to be used
to hold tailings, the hazardous substance involved
in the offences. Finally, Syncrude contended that
the Aurora Pond was not a natural nesting area for
migratory birds and therefore could not fall within
the purview of the MBCA.
The due diligence defence figured prominently.
It was Syncrude’s primary defence, however,
Syncrude was unsuccessful in establishing due
diligence. Provincial Court Judge Ken Tjosvold
found the hazardous nature of the Aurora Pond
foreseeable, and that Syncrude had not taken
sufficient steps to ensure that birds would not
be harmed. The Court found that Syncrude had
reduced its deterrence measures and staffing with
respect to bird protection and that there were
reasonable legal alternatives to the measures
employed by Syncrude that would have met the
criteria of the due diligence defence.
The conviction decision was issued by the Alberta
Provincial Court on June 25, 2010. Syncrude
was found guilty pursuant to both the provincial
and federal charges, with a sentencing hearing
to follow. Counsel for Syncrude indicated that
Syncrude intended to appeal the decision. However,
Syncrude then changed counsel and commenced
negotiations on a sentencing proposal. On October
22, 2010, the Alberta Provincial Court made a
sentencing order accepting the arrangements
struck between Syncrude and the Crown under
which Syncrude agreed to a total penalty of
$3,000,000 (the Sentence).
ENVIRONMENTAL LAW ALERT | NOVEMBER 2010
2
The Sentence includes both fines and additional
penalties. The Crown and Syncrude negotiated
the Sentence, taking into consideration s. 16 of
the MBCA and s. 234 of the EPEA. These “creative
sentencing” provisions authorize penalties in
addition to the fines set out in these statutes.
Typically, the additional penalties are used to
fund education and environmental protection
programs. A sentencing order issued pursuant to
either of these provisions will consider the nature
of the offence and the circumstances surrounding
its commission to determine how the additional
penalties may be directed consistent with the
purpose of the statutes.
Syncrude was sentenced to the maximum fine
available under the MBCA charge ($300,000 on
summary conviction) and the maximum fine under
the EPEA ($500,000), for a total of $800,000,
of which $250,000 of the EPEA penalty will be
applied towards the creation of a program for
bird protection and monitoring, integrated with
aboriginal training, at Keyano College in Fort
McMurray, Alberta.
The additional penalties under the MBCA and EPEA
totalled $2,200,000 to be applied to environmental
projects: $1,300,000 to the University of Alberta
for funding the Research on Avian Protection
Project; and $900,000 to the Alberta Conservation
Association to acquire land for the Golden Ranches
Waterfowl Habitat Project. All of the projects include
monitoring and accountability measures.
The Court did not issue reasons analyzing the
proposal and the Sentence. The Court accepted
the joint submission as sufficiently addressing
the applicable sentencing principles. Accordingly,
the Sentence may have less precedential value
in future application to other cases however it
demonstrates that a Court may apply the maximum
fine in appropriate circumstances as well as further
penalties given consideration of the nature and the
surrounding circumstances of the offence.
This case demonstrates how important it is to
exercise due diligence and take all reasonable
precautions to protect wildlife from foreseeable
environmental hazards created by business
operations. Employing adequate preventive
measures during the course of operations should
ensure that a due diligence defence is available if
similar charges are prosecuted.
It is important to note that historically charges have
only been laid in similar circumstances pursuant to
provincial authority. As the Crown was successful
in also prosecuting the federal MBCA charge, there
is now a heightened possibility of both federal and
provincial charges being laid in environmental
matters in the future for a single incident.
Moreover, the Sentence indicates that maximum
fines, and additional further penalties, may be
applied pursuant to both federal and provincial
environmental legislation.
The interesting legal issues raised by multiple
environmental convictions (federal and provincial)
for the same incident were expected to figure
prominently on the appeal by Syncrude.
However, the negotiated Sentence means no
appeal will proceed.
Finally, it should be noted that Syncrude was
charged prior to the new enforcement provisions
for the MBCA, pursuant to federal Bill C-16 which
received Royal Assent on June 18, 2009, but
which are not yet in force. These much tougher
enforcement provisions will see a “large company”
(defined as $5,000,000 in annual gross revenue)
facing a potential maximum fine under the MBCA
of $4,000,000 (summary conviction) to $6,000,000
(indictable offence), with a minimum fine of
$100,000 (summary) to $500,000 (indictment), as
well as the additional penalties available under the
creative sentencing provisions in the MBCA and
used with Syncrude.
For further information or any related inquiries
pertaining to environmental law, we invite you to
contact the Borden Ladner Gervais Environmental
Law Focus Group (the Group). Our national
Group draws upon the extensive experience of
its members so as to respond to the increasing
number of individuals and corporations which need
to take into consideration both the business and
legal implications associated with environmental
issues. The members of our Group have wideranging experience and expertise in this area.
The Group is committed to providing responsive,
cost effective and specialized services which
can help you to take into consideration issues of
environmental law.
AUTHORS
David Farmer
Matti Lemmens
CalgaryCalgary
403.232.9656403.232.9511
[email protected]
[email protected]
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National Group Leader
William K. McNaughton (Vancouver)
604.640.4120
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Regional Contacts
Calgary Ottawa Vancouver
Alan Ross
Janet Bradley Rick Williams
403.232.9712 613.787.3749 604.640.4074
[email protected] [email protected]@blg.com
MontréalToronto
Yves A. Dubois F.F. (Rick) Coburn
514.954.3130416.367.6038
[email protected]@blg.com
This Financial Services Alert is
general information, not legal advice.
We would be pleased to provide
additional details and to discuss
the possible effects of these
matters in specific situations.
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