Accounting for Law
Civil Litigation, Municipal

Municipal interests trump corporate welfare in safety matters

When public and corporate interests collide, the former will often override the latter —particularly when an element of safety is involved, Toronto civil litigator Heather Paterson tells AdvocateDaily.com.

“Municipalities’ decisions aren’t immune to challenge, but the bylaw must have a proper purpose and its subject matter has to be a municipal issue,” Paterson, a partner with Shibley Righton LLP, who has an active municipal defence practice. “It has to be something that’s in the public interest and in response to citizen’s needs.”

She points to a recent situation in a small Quebec municipality where a company had a permit to do some oil and gas exploration, but the village feared the drilling would negatively impact its drinking water.

Ristigouche Sud-Est, just north of the New Brunswick border, passed a bylaw creating a two-kilometre no-drill zone around potable water sources in the community. The company challenged the municipality’s authority to pass it and launched a $1-million lawsuit, arguing the village hastily adopted the new law, illegally targeting it and making it impossible for it to drill, Paterson says.

“Municipalities have very broad discretion to enact new laws, provided they’re considered to be within their purview of authority and the decision impacting the bylaw is reasonable,” she says. “In this case, the municipality had an obligation to its citizens to provide safe drinking water.”

Drilling near drinkable water sources raises issues of contamination and concerns over chemicals leaking into the soil, Paterson says.

Armed with scientific studies and strong support, the village was able to successfully defend its bylaw, she says.

“The court found the right to ensure safe drinking water was clearly within the municipality’s scope. Judges generally give a great deal of deference to municipalities provided it’s within their jurisdiction and with the proper purpose,” Paterson says.

“The strange thing about this case is there wasn’t a provincial act at the time that dealt with protected areas around potable water sources” such as the more than decade-old Ontario Safe Drinking Water Act, she says.

But Paterson points out that quickly changed after this decision.

Within months of Ristigouche Sud-Est adopting the bylaw, the Quebec government instituted a regulation creating a 500-metre protected perimeter around water sources, particularly around the oil and gas drilling context, she says.

“Had that been in place months earlier, the legal challenge likely wouldn’t have come up,” Paterson says.

Key to challenging a municipal bylaw is “proving the municipality acted in bad faith” and outside of its scope or jurisdiction, and that’s something the drilling company was unable to demonstrate, she says.

In the Quebec situation, the municipality had more than 50 per cent of the community expressing concerns, and it consulted with experts and produced scientific studies to support its position, Paterson adds.

“So it wasn’t something that was done on a whim, it was a well-thought out decision in how to protect its residents,” she says.

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