By Angela Stelmakowich

A decision by the Court of Appeal for Ontario has reiterated that the precise cause of an incident need not be identified for the due diligence defence to apply.

Justice Stephen Thomas Goudge, in his January 29 ruling, upheld an appeal judge's finding that companies facing a strict liability charge - as is the case under Ontario's Environment Protection Act (EPA) and the Occupational Health and Safety Act - can avail themselves of the defence.

The case revolves around a gasoline spill at Petro-Canada's facility in Thunder Bay, Ontario in January of 1993. Petro-Canada was charged under the EPA with discharging or causing or permitting the discharge of a contaminant into the natural environment that causes or was likely to cause an adverse effect.

The spill - the result of a pipe failure at a point where it was passing through an earthen berm - was compounded by the actions of two company employees, Justice of the Peace Thomas Logan concluded at trial. He found that one employee had manipulated gasoline reconciliation records, thereby disguising the spill. Another worker failed to close a valve upstream of the original spill site.

The Crown proved all the essential elements of the offence, J.P. Logan found, and because it was a strict liability offence, he then turned to the due diligence defence. But he determined that he was unable to apply the defence because, without evidence as to why the pipe failed, there was no way to determine if Petro-Canada had taken reasonable care.

"Was the failure caused by, say, corrosion, a frost heave, sabotage or mechanical accident? This is unknown," J.P. Logan wrote.

He found that Petro-Canada "had a number of safety systems and procedures in place both to prevent a pipe failure and, if it happened, to quickly detect it and mediate its effects."

But J.P. Logan interpreted R. v. I.T.T Industries of Canada Ltd. as requiring that an accused prove the precise cause of the failure for the defence to apply. Since Petro-Canada had not done so, he noted the defence had not been made out and the company was convicted.

On appeal, Judge Frank A. Sargent of the Ontario Court of Justice concurred the charge was a strict liability offence, but did not agree that identification of the failure's precise cause was requisite.

Judge Sargent concluded in his July 24, 2000 ruling that "a due diligence defence is made out in this case, unless it was patently obvious that reasonable care amounting to due diligence was not met or that it violated industry standards and/or statutory commitments."

Judge Sargent set aside the conviction and directed an acquittal. The decision, again, was appealed.

In his ruling, Justice Goudge of the appeal court cited the seminal judgement of Justice Brian Dickson in R. v. City of Sault Ste. Marie. Justice Dickson wrote that the due diligence defence "will be available if the accused reasonably believed in a mistaken set of facts which, if true, would render the act or omission innocent, or if he took all reasonable steps to avoid the particular event. These offences may properly be called offences of strict liability."

Justice Dickson described the balance in this approach by saying that while it relieved the Crown of the burden of proving mens rea (a guilty mind), it also stopped short of imposing absolute liability, which would deny an accused any defence whatsoever.

Justice Goudge noted that to require the accused to prove something that may well be beyond its knowledge to trigger the due diligence defence moves this category of offence closer to absolute liability than Justice Dickson intended.

Once the Crown proves the discharge of a contaminant, "the accused can successfully defend itself by showing, on a balance of probabilities, that it took all reasonable steps to avoid or prevent the discharge," Justice Goudge added.

As to Judge Sargent's findings on when a due diligence defence is made out, Justice Goudge noted "it suggests that only where the care taken falls so much short of the 'all reasonable steps' requirement that this shortcoming is 'patently obvious' will the defence fail. In both these respects, the appeal judge departs from the law as set out in R. v. Sault Ste. Marie, supra."

Justice Goudge agreed the appeal judge was correct to set aside the conviction, but erred in law in directing an acquittal. "Regrettably, given the length of time that has passed, the appeal must be allowed and a new trial directed."

Mary Beth Currie, a lawyer with Bennett Jones LLP in Toronto, says the case is a confirmation of existing law. An employer "is not required - and never has been required - to prove the cause of the accident in order to move forward to establish a due diligence defence," Currie says.

The Petro-Canada case brings to mind R. v. Timminco Limited, says Currie. The company was charged under the OH&S Act after a crown press operator was fatally injured in June of 1996 and discovered at the back of the press. The charge alleged Timminco's failure to ensure an exposed moving part on the press was fenced and guarded.

There was no requirement by the employer, written or otherwise, for operators to go behind the press to perform any job-related functions.

Timminco was acquitted after successfully arguing for a directed verdict before the trial judge, who ruled the company could not be found guilty if it did not know about the hazard. That ruling was overturned and Timminco appealed to have the original acquittal reinstated.

On appeal, Justice Douglas M. Belch allowed the Crown's appeal and ordered a new trial. He concluded that the trial judge erred in granting the motion for a directed verdict and in acquitting Timminco.

The company appealed and the matter moved to the Court of Appeal.

Crown counsel had previously argued the press had an exposed moving part that endangered the worker. Timminco responded that significant steps had been taken to promote and provide a safe workplace and that the company had no knowledge of the area the Crown said posed a danger.

The appeal court concluded Timminco's lack of knowledge of the hazard "is relevant only in respect of any diligence defence it may advance."

Crown counsel Bruce Arnott said at the time that the ruling confirmed the Crown is not required to demonstrate a mental element on a strict liability offence to achieve a conviction.

"The potential consequences could have been quite dramatic had we not received the categorical confirmation of the law as we always understood it to be," Arnott said. "There could have been grave implications for the enforcement of public welfare legislation," he added.

Currie suggests that, in environmental cases, the courts may feel that compliance with industry standards is enough. But it may be a harder sell in "health and safety land," she continues, because industry standards may be irrelevant. What the court really wants to see is that a company has taken the steps to prevent a specific occurrence, she says.

Where an employer can prove the actual cause of a failure, Currie suggests it may make the due diligence defence easier because an accused can point to what steps were taken to prevent that very narrow breach.

If "employers tended to think that they could move into trying to establish that industry standards constituted due diligence, this will end that," Currie says of the Petro-Canada ruling.

"I think that employers need to consider the hazards of their workplace and if steps have been taken to prevent harm to workers. And that may mean going up and beyond industry standards at the specific workplace," she says.

The Petro-Canada ruling clearly shows the appeal court is being consistent, says Currie. It is not necessary to demonstrate what caused the accident and the onus of proving that the employer took all steps reasonable falls on the employer.

Angela Stelmakowich is editor of ohs canada.