Supreme Court of Canada dismisses appeal of Shawnigan soil case

The Cowichan Valley Regional District has reached a dead end in its legal battle against the storage of contaminated soil in a quarry uphill from Shawnigan Lake.

The Supreme Court of Canada has dismissed the district’s application to appeal a lower court ruling in the case.

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The latest development essentially upholds a decision by the B.C. Court of Appeal that found the quarry operates as a mine and that regulating its activities is the responsibility of the provincial government rather than the regional district.

The district had argued that the quarry was operating as a landfill in contravention of a regional district zoning bylaw.

Victoria lawyer Aurora Faulkner-Killam, who represents quarry owners Cobble Hill Holdings Ltd. and South Island Aggregates Ltd., said her clients are pleased that the appeal court ruling will stand. “They think it’s fair,” she said. “It’s an important decision for the mining industry in B.C. The decision respects the province’s jurisdiction over mines and the expert- and evidence-based regime in B.C. that regulates safe soil movement.

“The tension in this case was that the local government wished to have more of a say in what amounted to provincial decisions regarding mines.”

The Cowichan Valley Regional District expressed its disappointment. “The B.C. Court of Appeal decision has significantly limited local government’s ability to regulate certain activities associated with mining,” district chairman Jon Lefebure said in a statement. “That is not in the best interest of our communities.”

The district noted that it has exhausted all avenues of appeal. “The CVRD will continue to advocate for provincial ministries to respect the interests and concerns of local communities when considering approval of similar facilities in the future,” the statement said.

The Supreme Court decision means the district is on the hook for increased costs awarded by the Court of Appeal to Cobble Hill Holdings Ltd. last month. The appeal court found that the company “paid a heavy price for the complex litigation, which was commenced by a state actor to address an issue that could only have been effectively resolved at the political level or at the [Environmental Appeal Board].”

The court said that awarding ordinary, instead of increased costs, “would create an unjust result for [Cobble Hill Holdings].”

The CVRD said Thursday that its costs have yet to be determined.

The battle between the company and regional district was overshadowed this year when the provincial government cancelled the company’s permit to store contaminated soil in the quarry.

The government said the company failed to provide the province with adjusted financial security in the form of an irrevocable letter of credit. The company says the government decision was “unlawful and unreasonable.”

The controversy dates back to 2013 when the Ministry of Environment issued Cobble Hill Holdings a permit to receive and store up to 100,000 tonnes of contaminated soil a year at its quarry. The permit was upheld by the Environmental Appeal Board in 2015, but faced multiple court challenges before the ministry finally cancelled the permit in February.

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