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37th PARLIAMENT, 1st SESSION

Standing Committee on Environment and Sustainable Development

COMMITTEE EVIDENCE

CONTENTS

Thursday, February 28, 2002

0915

The Chair (Mr. Charles Caccia (Davenport, Lib.))

Mr. Robert G. Connelly (Vice-President, Policy Development, Canadian Environmental Assessment Agency)

The Chair

Mr. Robert Connelly

0920

The Chair

Mr. Robert Connelly

Ms. Heather Smith (General Counsel, Department of Justice; Senior Counsel, Legal Services, Canadian Environmental Assessment Agency)

0925

0930

Mr. Robert Connelly

The Chair

0935

Mr. Robert Connelly

The Chair

Mr. Bob Mills (Red Deer, CA)

Mr. Robert Connelly

Mr. Bob Mills

Mr. Robert Connelly

Mr. Bob Mills

0940

Mr. Robert Connelly

Mr. Bob Mills

The Chair

Mrs. Karen Kraft Sloan (York North, Lib.)

Ms. Heather Smith

Mrs. Karen Kraft Sloan

The Chair

Mrs. Karen Kraft Sloan

Ms. Heather Smith

0945

Mrs. Karen Kraft Sloan

Mr. Robert Connelly

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

The Chair

Mr. Julian Reed (Halton, Lib.)

0950

Mr. Robert Connelly

Mr. Julian Reed

Mr. Robert Connelly

0955

Mr. Reed

The Chair

Mr. Alan Tonks (York South--Weston, Lib.)

Mr. Robert Connelly

Mr. Alan Tonks

Mr. Robert Connelly

Mr. Alan Tonks

Mr. Robert Connelly

Mr. Alan Tonks

Mr. Robert Connelly

Mr. Tonks

The Chair

1000

Mrs. Karen Redman (Kitchener Centre, Lib.)

Mr. Robert Connelly

Ms. Heather Smith

Mrs. Karen Redman

Ms. Heather Smith

Mrs. Redman

The Chair

Ms. Hélène Scherrer (Louis-Hébert, Lib.)

Ms. Heather Smith

Ms. Hélène Scherrer

1005

Ms. Heather Smith

Ms. Hélène Scherrer

Ms. Heather Smith

Ms. Hélène Scherrer

Ms. Heather Smith

Ms. Hélène Scherrer

Ms. Heather Smith

Ms. Hélène Scherrer

Ms. Heather Smith

Ms. Hélène Scherrer

The Chair

1010

Ms. Heather Smith

1015

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

Ms. Heather Smith

The Chair

1020

Ms. Heather Smith

The Chair

Mr. Bob Mills

Ms. Heather Smith

Mr. Bob Mills

Mr. Robert Connelly

Mr. Bob Mills

Mr. Robert Connelly

1025

Mr. Bob Mills

The Chair

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

A voice

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

Mrs. Karen Kraft Sloan

Ms. Heather Smith

1030

Mrs. Karen Kraft Sloan

Mr. Robert Connelly

Ms. Heather Smith

An hon. member

The Chair

CANADA

Standing Committee on Environment and Sustainable Development

NUMBER 062

1st SESSION

37th PARLIAMENT

COMMITTEE EVIDENCE

Thursday, February 28, 2002

[Recorded by Electronic Apparatus]

¿ (0915)

[English]

The Chair (Mr. Charles Caccia (Davenport, Lib.)): Bonjour, mesdames et messieurs. We have a very important session this morning, with a presentation by the Canadian Environmental Assessment Agency. We have invited their representatives to speak to us on the Federal Court of Canada decision regarding the Red Hill Creek Expressway in Hamilton, an item that has garnered considerable attention in the public domain.

We have a quorum, and we'll proceed without delay by welcoming you, Mr. Connelly, Madame Smith, and Mr. Clarke. The floor is yours. Please proceed, and thank you for coming back to see us again.

Mr. Robert G. Connelly (Vice-President, Policy Development, Canadian Environmental Assessment Agency): Thank you for the opportunity to appear before you again, Mr. Chairman. Today, as you have requested, we have a presentation on the recent Federal Court decision on the Canadian Environmental Assessment Act and the fact that it does not apply to the proposed Red Hill Creek Expressway in Hamilton.

Beyond the specific details of the Red Hill case, the Federal Court decision raises an extremely important policy question about the federal environmental assessment process. Namely, should the act apply to projects that are already in an advanced stage of planning at the time when a federal decision is sought?

[Translation]

This is a question that we thought was positively settled over a decade ago with Court decisions on the Rafferty-Alameda Dam in Saskatchewan and Oldman River Dam in Alberta. Unfortunately, in the aftermath of the Red Hill Creek decision, things are not so clear. The resulting lack of clarity may have negative implications for the future application of the Act.

Mr. Chairman, so that members of the Committee have a full understanding of this issue, I will briefly go over the facts of the Red Hill Creek case. My colleague, Heather Smith, from the Department of Justice, will explain the Court's decision and why we believe it may be a problem.

[English]

I wish to note that Bill C-19 does not currently address this issue, because it was introduced as a bill in March of last year, before the Federal Court Trial Division rendered its decision in April and the Federal Court of Appeal rendered its decision in November of last year. Once we have identified the problem, we will share with you our preliminary thoughts on a possible solution here this morning.

We have given our presentation to the clerk. In the interests of time, rather than taking you through the chronology or detailed history of all the events that have occurred—they began in the 1950s and are detailed in the text I have given you—I'll jump ahead to the summary of those chronological events that appears on page 3 in both the English and French texts.

The Chair: Excuse me for interrupting, but given that this session is televised and the chronology is quite interesting, you may want to go through it so as to give the full framework to people who might be interested in the entire issue, if you don't mind.

Mr. Robert Connelly: Certainly, Mr. Chairman. I'd be glad to do that. Let me proceed through the text that you also have in front of you.

As I mentioned, Mr. Chairman, the idea to build the Red Hill Creek Expressway dates back to the late 1950s. Over the years, various routes were considered. In 1979, the regional municipality selected the current alignments for the east-west and north-south portions of the expressway.

The regional municipality proceeded with an environmental assessment submission to the Ontario government in 1983. I would note that there was no federal participation in the provincial assessment at that time, due to the fact that it was not a federal initiative and did not involve federal funding or land.

These were times prior to the current Canadian Environmental Assessment Act, of course. The provincial Ministry of Natural Resources, which administered aspects of the habitat provisions of the Fisheries Act at the time, advised that it had no fisheries-related concerns with the project.

The municipal government began to make preparations to proceed with the expressway well before provincial approval came in 1985. Properties were expropriated, structures were demolished, development charges were imposed, various bylaws were passed, and arrangements were made for the financing of the project.

Construction of the north-south portion started in 1990, but funding was withdrawn following a change of provincial government. Further construction of that portion was consequently suspended, except for three overpasses for which contracts had been let. Following the election of the current provincial government in 1995, funding for the north-south portion was reinstated and the regional municipality again began planning for an expressway with a design somewhat different from what was approved in 1985.

The new design requires the partial realignment of Red Hill Creek, as well as eight crossings. Because the creek provides habitat for fish, the Department of Fisheries and Oceans informed the regional municipality that the new design for the north-south portion of expressway would require a Fisheries Act authorization. As the Department of Fisheries and Oceans had a decision to make about whether or not to grant this authorization, requirements for an environment assessment under the Canadian Environmental Assessment Act were also triggered. Basically, that means the Fisheries Act was the trigger.

At the provincial level, an exemption order was granted under Ontario's Environmental Assessment Act in 1997. The regional municipality then formally applied for the Fisheries Act authorization in 1998, and the screening under CEAA was started. During the screening, Environment Canada determined that the project would result in the loss of migratory bird habitat and that the significance of the impact of this loss on migratory birds was unknown. In addition, the fisheries and oceans and the environment ministers received many letters expressing concern about the expressway project.

In May 1999, based on the potential for significant adverse environmental effects and on public concerns, the Minister of Fisheries and Oceans, in accordance with section 25 of the act, asked the Minister of the Environment to refer the project to a review panel immediately, without awaiting the outcome of the screening. The Minister of the Environment agreed. Shortly thereafter, the Regional Municipality of Hamilton-Wentworth applied to the Federal Court for a judicial review of a number of issues, but most importantly, the federal government's decision that the Canadian Environmental Assessment Act, as well as the Fisheries Act, applied to the project.

In summary, Mr. Chairman, I will just go over some of the details and key elements of this chronology that I have gone through.

First of all, the notion of a Red Hill Creek Expressway goes back over four decades. Secondly, provincial approval for construction was granted in 1985. Physical construction started in 1990, but was halted when funding was cut that same year. Also, in the late 1990s, reinstatement of funding was accompanied by changes in project design that triggered CEAA. Finally, the Regional Municipality of Hamilton-Wentworth challenged the application of the Canadian Environmental Assessment Act in the Federal Court of Canada.

So those are the—

¿ (0920)

The Chair: Before you go to the next chapter, on litigation, could you also give the committee a rough idea of the extent of the number of trees that would have to be cut and the number of creeks that would be damaged or affected, so that we get an ecological summary?

Mr. Robert Connelly: My understanding, Mr. Chairman, is that the number of trees to be cut would be in the area of about 40,000. The length of the expressway is about 8 kilometres. A considerable portion of the Red Hill Creek would have to be rechannelled—in other words, put in a different location that is not substantially different from the original location, but channelized.

The environmental concerns associated with the project at the time of the commencement of the review, as identified by the public and by various federal authorities, included fish habitat and effects on fish in the stream. There were also concerns about the potential impacts of the tree-clearing on migratory birds and on migratory bird habitat, because, as I understand it, there are sensitive marshlands in the area that could be affected adversely. There were also concerns about certain species of plants and trees that are considered of importance in the local area as well. In summary, Mr. Chairman, I think those would be the main environmental attributes that were identified at the beginning of the review.

I will now turn to my colleague Heather Smith, Mr. Chairman. She will take us through some of the facts associated with the litigation itself.

Ms. Heather Smith (General Counsel, Department of Justice; Senior Counsel, Legal Services, Canadian Environmental Assessment Agency): Mr. Chairman, litigation regarding the federal environmental assessment process is usually in the form of what is known as judicial review. The full name for that process is an application for judicial review of administrative action.

[Translation]

This is called an application for judicial review. It is the mechanism through which courts supervise the actions of the executive branch of government. The Federal Court of Canada is responsible for supervising the activities of federal departments, agencies and bodies.

In the case of the Red Hill Creek Expressway, the Regional Municipality of Hamilton-Wenworth sought judicial review of Fisheries and Oceans' decision that the Fisheries Act applied to the project; of Fisheries and Oceans' decision that the Canadian Environmental Assessment Act applied to the project; of the Minister of Fisheries and Oceans' request to the Minister of the Environment to refer the project to a review panel; and of the Minister of the Environment's appointment of a panel and establishment of the terms of reference for the panel.

The Friends of the Red Hill Creek Valley -- an environmental NGO opposed to the project -- were granted intervenor status and appeared before the court. They were represented by the Canadian Environmental Law Association. The Province of Ontario also intervened in the proceedings and supported the Regional Municipality of Hamilton-Wenworth.

¿ (0925)

[English]

In the Federal Court Trial Division decision of last April 24, the judge in the case, Justice Eleanor Dawson, granted the application for judicial review on the grounds that CEAA does not apply to the expressway. She also held that, based on the facts of the case that were before her, the decision to refer the project to a review panel was not supported by a valid head of federal jurisdiction. Since she had already concluded that CEAA does not apply to the project, it wasn't strictly necessary for Justice Dawson to rule on this issue, but she did address it in her decision. She also concluded that it was too late for the regional municipality to challenge DFO's determination that the Fisheries Act applied to the project. Other issues were also raised in the litigation, but she didn't rule on those issues.

Mr. Chairman, the federal government decided to launch a partial appeal of the decision, and we wanted to focus the attention of the Federal Court of Appeal on the crucial issue of whether or not CEAA applies to a project in an advanced stage of planning. When the Federal Court of Appeal heard the case, it upheld the decision of Justice Dawson and concluded that she did not commit any reviewable errors in her decision. That is, they saw no reason to intervene in order to overturn her decision.

I'd like to describe in a little more detail the Federal Court's reasoning for why CEAA doesn't apply to the Red Hill Creek project. There were two strands of reasoning: first, because of the application of subsection 74(4) of the Environmental Assessment Act, which is known as a grandfather clause; and second, because it would be a retroactive application of CEAA to a project for which irrevocable decisions were made prior to the coming into force of the act in January 1995.

It's this second line of reasoning that we find particularly problematic. The concept of irrevocable decisions is found throughout the Environmental Assessment Act, and it is found in section 11, the section the court looked at in the Red Hill Creek case. Section 11 requires federal authorities to

ensure that the environmental assessment is conducted as early as is practicable in the planning stages of the project and before irrevocable decisions are made....

That's an obligation that rests on the federal departments.

We have always interpreted the words “irrevocable decisions” in section 11 to mean the decisions of federal authorities, but Justice Dawson concluded that they had a broader meaning than that. She held that the terms included decisions by the municipal government. The municipal government is the proponent of the expressway in this case, so along the line of this reasoning, decisions by a proponent can prevent the application of CEAA.

The court concluded that irrevocable decisions to construct the entire expressway had already been made by the regional municipality prior to the enactment of CEAA, when they took actions such as expropriating property, demolishing structures, imposing development charges, passing bylaws, and arranging financing. All of those things, the court found on the facts of the case, had happened prior to the coming into force of CEAA.

The English wording of the definition of “project”, which refers to “any proposed construction”, also figured prominently in Justice Dawson's reasoning. She concluded that the expressway was not a project for the purposes of CEAA. Because irrevocable decisions to initiate construction had been made prior to 1995, the construction of the expressway was no longer proposed. It was therefore not a project for the purposes of the act. In other words, the court ruled the expressway didn't fit within the definition of “project” because it was beyond the proposal stage when CEAA came into force in 1995. As a result, federal environmental assessment requirements do not apply to the project.

Mr. Chairman, we're concerned about this reasoning because it runs counter to the purpose of CEAA, which is to ensure that the environmental effects of projects receive careful consideration before federal decisions are taken. Without the information gained through the application of CEAA, federal decision-makers would have little, if any, information about the potential environmental impacts of projects that proceed as a result of their decisions.

¿ (0930)

Mr. Robert Connelly: Thank you for explaining the litigation to us and to the committee, Heather.

Continuing on, Mr. Chairman, I would indicate that whether or not CEAA applies to a project cannot simply depend on whether the proponent, the province, or anyone else has already made a decision in relation to it. If so, our concern is that proponents might plan their projects in such a way as to make irrevocable decisions before seeking federal decisions. In doing so, they could attempt to prevent application of the Canadian Environmental Assessment Act.

As I mentioned earlier with respect to the Environmental Assessment Review Process Guidelines Order, or EARPGO, and decisions taken at the Federal Court Trial Division, the Federal Court of Appeal, and even at the Supreme Court level, we had thought the issue of whether the act applies to projects in advanced stages of planning was settled. As I mentioned, in those previous decisions, we felt the results of the Rafferty-Alameda and Oldman River Dam cases were quite clear. Namely, the federal environmental assessment process had to be applied before departments could make a decision—and that was the EARPGO trigger.

Secondly, it did not matter whether the federal decision was sought early or late in the planning stages of the project, or even in the implementation stages of a project. The federal environmental process had to be applied whenever the federal decision was sought.

Thirdly, the application of the federal environmental assessment process was not affected by the decisions of others, we thought, whether they were provincial or municipal governments, proponents, or anyone else.

Mr. Chairman, one of the reasons why the government decided not to seek leave to appeal the Federal Court of Appeal decision is that we believe Bill C-19 provides a timely opportunity to propose amendments to ensure that the original intent of the act is met. We believe it is important to clarify two things in the act: first, that a project continues to be proposed as long as the federal decision in relation to the project has not yet been made; and second, the decision of others does not affect the application of the federal environmental assessment process—and by “others”, I mean non-federal bodies.

Finding a way to insert these messages clearly into CEAA is a challenge, and we've given a fair bit of thought to the issue. If any lesson is to be drawn from the Red Hill Creek litigation, it is that more words do not necessarily make things clearer. We are conscious that any changes made to the act could generate further litigation. We believe that, to be effective, any amendments should address the reasoning relied upon by the courts. They should specifically address the questions surrounding the issues of “irrevocable decisions” and the definition of “project”.

Our current thinking for one proposed amendment is the addition of a statement to aid in the interpretation of the relevant provisions of the act. It could be placed in the interpretations section, section 2, which is the section dealing with definitions. Essentially, such an amendment would make it clear that a proposed project requires an environmental assessment until a federal authority makes a decision. In other words, decisions by other bodies would not count as irrevocable decisions, and the federal environmental assessment process would apply at the time a federal decision is sought even if the project is in an advanced planning stage.

[Translation]

Mr. Chairman, as I said, this is an issue that we are taking very seriously. We are gratified by the Committee's interest and your scheduling a full session to examine this matter. Our goal is to ensure the integrity of the process so that federal decision-makers have the benefit of information about potential environmental effects when decisions are made about specific projects.

[English]

We thank you for this opportunity, Mr. Chairman, and we'd be pleased to respond to questions that you and members may have regarding our presentation.

The Chair: Do we interpret your conclusion to mean that we can expect appropriate amendments from you when we start the clause-by-clause study?

¿ (0935)

Mr. Robert Connelly: That is correct, Mr. Chairman. In the presentation, we have given you an indication of our current thinking in the areas that we think need to be corrected. We are currently working on drafting such proposed amendments. Of course, we need further consultations on those within our federal system before feeling confident that we have wording fashioned in a way that we think is appropriate in order to bring them forward to you.

The Chair: All right, thank you.

We'll start with Mr. Mills, Madame Kraft Sloan, Mr. Reed, and Mr. Tonks.

Mr. Bob Mills (Red Deer, CA): What comes to mind from your presentation—and in looking at this, I must admit I don't know a lot of the details; you've given us the overview—is a wondering about how many projects may well have been approved in the past. I just wonder how severe a problem this really is. What comes to mind is a project called PRIME, which existed in Alberta in the fifties. Rivers were diverted and a great deal of engineering work and research work was done. Obviously, it fell into disrepute, but I understand that the Alberta government is now reviving that concept of inter-basin transfer of water. I think B.C. is doing the same sort of thing.

Obviously, from what you've just described in the court decision, because those PRIME projects were effectively approved in the fifties, conceivably the argument could be made that they aren't subject to CEAA. Am I interpreting that correctly?

Mr. Robert Connelly: In response to your question, Mr. Mills, I think you've touched on a very important point. You've expressed exactly the concern that we have. Namely, if I understand the examples you gave, others—perhaps provinces, as in this instance—could have made decisions that would be considered irrevocable unless we look at an amendment to CEAA to respond to that concern. I think that's why we think it is a very important question that needs to be looked at carefully and, we hope, corrected.

Mr. Bob Mills: With your proposed amendments, then, invoking this kind of an environmental review would conceivably possibly ignore the fact that x number of dollars had been spent on a project. An example would be something that was going ahead in 1980, was stopped for whatever reason, but has now been reinstituted. As you mentioned in this example, a lot of money was expended. How do we justify it to the taxpayer when we turn down a project in, say, 2003, when $10 million had been spent prior to 1995? How do we answer that?

Mr. Robert Connelly: Well, Mr. Mills, I think we have to look carefully at the facts of any proposal brought forward. The first example you gave, if I understood it, was something that was in early planning. A lot of thought had gone into it, but no construction had occurred.

On the other hand, if something was very advanced prior to 1984—the year for which the grandfather clause in the current act kicks in—was perhaps stopped and was then started up again later on, then given the way the act is set up, such a project could be grandfathered if no significant modification is made to the design once that project is started up again.

So I would say we have to look at the facts, really. We obviously want to be careful in terms of applying the act appropriately to whatever the situation is.

Mr. Bob Mills: I just think of PRIME again, so I'll come back to that project. Really, when you think about it, the Alberta government—and I know Alberta best, so I use it as an example—could use the argument that the Dickson Dam on the Red Deer River, the Oldman River Dam, and other dams that have been built, were part of the PRIME project. In fact, they were. In other words, dam the water and then you can control its release, transfer it from basin to basin, and ultimately, transfer it to California, I suppose. All of that was part of the 1950s plan, so I suppose you could make a case that we did build these major dams back in the sixties because we were going to go ahead with this project. I'm just playing the devil's advocate here, thinking about how you could make a case for that sort of thing. Would this fix that?

¿ (0940)

Mr. Robert Connelly: Mr. Mills, we believe the concept that we've laid before you as a proposal at this point would fix that issue, if I understand you correctly. That is, if some new project—I'll use that word—some new construction was required to allow for some interconnection of those basins, we believe that with the proposed idea that we have laid before you to amend Bill C-19, to amend our act, we would be able to subject that type of thing to CEAA in the future, assuming that some federal trigger is associated with it—and I presume one would be. Without it though, it's possible that we might not have a role in such a project.

Mr. Bob Mills: Thank you.

The Chair: Thank you, Mr. Mills.

Madame Kraft Sloan, please.

Mrs. Karen Kraft Sloan (York North, Lib.): Thank you, Mr. Chair.

As I understand your presentation, the Federal Court of Appeal decision came out on April 24.

Ms. Heather Smith: No, that was the Trial Division decision. The Court of Appeal decision came out in November.

Mrs. Karen Kraft Sloan: Oh, it was November. Sorry.

So you have a situation in which Bill C-19 was tabled before you actually had the...and now we're looking at an amendment. I would have greater confidence in the problem being dealt with if it had been in the original Bill C-19 as opposed to being in an amendment, because those of us around this table have seen even government amendments reversed.

For example, with CEPA, the government introduced an amendment to change wording pertaining to “virtual elimination”, because it was deemed incomprehensible and there was some contradiction with the Toxic Substance Management Policy. When the bill went back into the House at report stage, though, the government itself bowed to pressure and the amendment was eventually reversed and was made significantly weaker than even the original definition. We are certainly witnessing the same sort of effect. Government-supported amendments made by this committee were reversed at report stage for the new Species at Risk Act.

I would have some concern that we are pinning the hopes of solving the Red Hill Creek problem on making an amendment to Bill C-19. I know you can't address the politics of things, but if we put forward an amendment in this committee, it's often seen as a committee amendment even though it is a government amendment or government-supported amendment. Therefore, it is certainly up for grabs with all kinds of particular special interest groups.

If we make this change, what kind of guarantee can I receive, as government vice-chair of this committee, that it will remain intact as it makes its way through the House?

The Chair: But that's not a question the officials can answer, Madame Kraft Sloan.

Mrs. Karen Kraft Sloan: Well, that's really unfortunate, Mr. Chair, but I wanted to get that on the record.

Just looking at your presentation, there was an issue around the habitat of migratory birds. How do you feel this particular issue was dealt with? I don't really see it reflected in your brief.

Ms. Heather Smith: Maybe I can address that.

As I mentioned when I walked you through the case, there were a number of issues at Trial Division, but the decision centred on two big issues. Does CEAA apply to the project? Was there a valid referral of the project to panel review under CEAA?

The court dealt with the first question first, as it ought to have done, and concluded that CEAA did not apply to the project. Once they reached that decision, it was really not necessary, from a legal point of view, to go to the next question about the reasons the government had for referring something to panel review. The judge did deal with it in her decision, but it was a question that was really not central to the disposition of the case once the court had decided the act didn't apply to the project. We therefore chose to focus on that threshold issue of whether or not the act applied to the project, and that's what we pursued through the litigation.

¿ (0945)

Mrs. Karen Kraft Sloan: You'll have to forgive me, but I'm not a lawyer, and particularly not an environmental lawyer. As I understand it, though, the Friends of Red Hill Valley put forward an argument that the project was a modified project, and that there is a requirement for authorization under the Fisheries Act if there is a modification of a project. What they put forward was that there was a difference in design between 1985 and 1998. Again, they were probably arguing against the grandfathering element and were also arguing in favour of application for authorization of a permit under the Fisheries Act.

Originally, eight expressway crossings were proposed...I'm sorry, there was a different project. In the new project, eight expressway crossings were proposed, not the original fourteen, and a natural channel design was put forward to minimize what were originally four kilometres of creek banking in concrete. And there were other issues, as well.

On one hand, we have modification of a project as the trigger for authorization of Fisheries Act permits. On the other hand, it seems there may be some lack of clarity under CEAA in regard to whether or not the modification of a project is a trigger. And again, this is new subject matter in front of me, so clarification from you would be very helpful at this point.

So the question that I would ask is whether or not there is clarity under CEAA with regard to the modification of projects. If it doesn't exist, what can we do with Bill C-19 to improve that clarity?

Mr. Robert Connelly: Mr. Chairman, in response to that question, let me reconfirm that Mrs. Kraft Sloan is quite correct. A modification to a project would still require Fisheries Act authorization. There is now some doubt created regarding the grandfather clause, but the reference by the judge said the modification was not considered sufficient to be considered a new project in this instance. The judge ruled that the modification was related to mitigation measures, and that, for all intents and purposes, the project was still the same project. This is an issue that we didn't address in our presentation, but it is an issue that we are looking at in the context of that grandfather clause.

Mrs. Karen Kraft Sloan: But with regard to CEAA, if I understand you correctly, there is a question about whether or the modification was mitigation, and if it indeed is mitigation, it's not affected.

Ms. Heather Smith: Maybe I can come back to the courts. The question the court was asking itself was whether this was the same project that was always proposed, or whether it was a different project? When the court looked at the changes in the project that were proposed by the regional municipality since CEAA came into force, it said all of those changes go to mitigation measures. It used them as the reason to say it's the same project, not a modified project. When we were before the court, we argued the same thing as the Friends of Red Hill Valley, but the court told us we were wrong.

Mrs. Karen Kraft Sloan: I do hope you can respond to the modification issue under CEAA at some point.

Thank you.

The Chair: We'll come back to you in the second round.

Mr. Reed, please.

Mr. Julian Reed (Halton, Lib.): Thank you, Mr. Chairman.

I have a continuing concern for one fundamental issue that has obviously been given expression here, in the courts, and so on. It seems to me to be common to all of the actions of government, in that it seems somehow acceptable to grandfather rule changes after a project is underway. I've seen it happen time and time again, and it has happened to me personally. A project is begun, you get into the middle of it, and a year and a half later, the specs for this and that are changed all of a sudden, so now you have to comply with another set of rules.

This came up very forcefully in a previous committee that I sat on, when the mining industry was appealing to us to make sure that if a set of rules prevailed at a given time when a project was being planned, then those rules applied and whatever changed after that might apply to the next project or to projects after that.

I don't know how much Red Hill has cost, but I can tell you it's not pennies. In the case of mining companies, it often costs millions of dollars when these rule changes are made retroactively.

Do you have any comment to make on that? Is there any way we can stop that?

¿ (0950)

Mr. Robert Connelly: Mr. Chairman, in response to Mr. Reed's question, maybe I will explain how we thought the grandfather clause put into CEAA would work.

The grandfather clause had a cutoff date of 1984. The reason 1984 was selected was that it was the time when the previous regime had started prior to the Canadian Environmental Assessment Act coming into force. In 1984, we had the Environmental Assessment Review Process Guidelines Order in place, and then CEAA came into force in 1995.

The thinking was that any project for which construction or operation had occurred prior to 1984 would not be subject to the Canadian Environmental Assessment Act, except if some modification to that project was made down the road. If that occurred, it could be reassessed.

So in part, the issue here was whether or not this was a modified project when compared to that which had been approved prior to 1984. That really became the issue of contention, and Justice Dawson did rule it was essentially the same project and should therefore not be subject to CEAA.

Mr. Julian Reed: If I have the time, Mr. Chairman, let me take it one step further in terms of the regulatory process.

Suppose a proponent starts a project. A regulation changes twelve months later. All of a sudden, the project is in jeopardy because of a regulatory change by government. That happens all the time, and I can get into details if you want.

Maybe this doesn't apply directly to this case. I'm not sure whether it does or not, but there is somehow a fundamental assumption that a regulation that will stop everything can be put into place. A proponent may have spent hundreds of thousands or millions of dollars on a project, but is then forced to rework the project according to the new regulations. I want to go on the public record as saying I'm dreadfully opposed to that kind of behaviour. Is there any way we can stop it in government?

Mr. Robert Connelly: Mr. Reed, I don't think I can answer that generic question for you in terms of government-wide behaviour. I can only address it with respect to the Canadian Environmental Assessment Act. Really, the intent was simply that if projects were already built or operating at a very advanced stage, CEAA wouldn't apply to them after 1984. I think it recognized that if a substantial modification was made to the project, that was a different situation and should be looked at. That's what we thought we were doing in this instance, and we thought it was correct.

¿ (0955)

Mr. Julian Reed: Thank you, Mr. Chairman.

The Chair: Mr. Tonks, please, followed by Madam Redman.

Mr. Alan Tonks (York South--Weston, Lib.): Thank you, Mr. Chairman.

My first set of questions deals with the matter of process. I would like to understand something. Is the intent of your amendments focused on retroactively applying this to the Red Hill decision through the court, or are your amendments coming forward in the spirit of dealing with the application of the Canadian Environmental Assessment Act possibly retroactively for other projects?

Mr. Robert Connelly: I think the answer there, Mr. Tonks, is a no to the first question and a yes to the second, but let me just elaborate a little bit.

We are obviously concerned about the implications of this decision with respect to what constitutes an irrevocable decision. In other words, for future projects, we want to prevent others from taking decisions about a project, coming to the federal government for approval at the very last moment, and then being able to argue that it's too late for the Canadian Environmental Assessment Act to apply. That's what we're trying to correct here.

Mr. Alan Tonks: If I could interpret that, what course of action might the regional municipality now take in light of this decision? On the application of judicial review, they have now achieved the right of appeal. Will those proceedings go forward now?

Mr. Robert Connelly: Right now, Mr. Tonks, the judicial decision means that the Canadian Environmental Assessment Act does not apply to that project; however, the regional municipality would still be required to get its Fisheries Act authorization in order to allow them to proceed to get an authorization to destroy habitat within the Red Hill Creek valley. As I understand it, those discussions are underway between the regional municipality and the Department of Fisheries and Oceans.

Mr. Alan Tonks: And those discussions would be aimed at litigation. Some sense of that would be that they're now going back to the question raised by my colleague Ms. Kraft Sloan, in terms of whether it was a modified approach or whether it was a mitigation, and whether that was enough to comply with the Fisheries Act.

Mr. Robert Connelly: They would be looking at mitigation measures insofar as they deal with fish and fish habitat, yes.

Mr. Alan Tonks: Okay, thanks.

Mr. Chairman, that satisfies my position at least with respect to due process or natural justice. For future considerations, though, if we are attempting to apply retroactive adjustments in a very broad way when these kinds of cases come along, it seems to me that we're almost acting as a court ourselves and that the other entities should probably be given an opportunity to appear before the committee.

But in this one, if I understand it, it appears that with the recommendations that are coming back here, this is now the jumping-off point—the threshold of dealing with retroactivity, in a sense—as it relates to the court's decisions on irrevocable decisions and so on. But in terms of Red Hill, we are not having a hearing that is essentially on Red Hill, because that has gone into another process.

Am I right in that? Is that your sense of what is happening here?

Mr. Robert Connelly: Yes, and let me respond again by making it clear that the amendments we talked about at a conceptual stage would not result in the reapplication of the Canadian Environmental Assessment Act to the Red Hill Creek project, in our view, but would strive to avoid a problem for future projects in general.

Mr. Alan Tonks: Those are all the questions I have at the moment, Mr. Chairman.

The Chair: Thank you.

Madame Redman, please.

À (1000)

Mrs. Karen Redman (Kitchener Centre, Lib.): Thank you, Mr. Chairperson.

I recognize the fact that we're dealing specifically with the Red Hill Creek Expressway, but I'm wondering if I could ask a bit broader question. In general, has litigation been problematic under CEAA as it has been applied to date? Have there been a lot of cases like Red Hill Creek?

Mr. Robert Connelly: Mr. Chairman, in response to Madame Redman, I would call on Heather Smith to assist me. First of all, however, I would point out that in 7 years of application of the Canadian Environmental Assessment Act, we have had litigation involving 33 projects, and we have about anywhere from 5,000 to 6,000 projects per year going through the process. If I do some fast math here, 6,000 times 7 would equal 42,000 projects, with 33 case in litigation. Those are the facts in terms of the amount of litigation, but perhaps Heather can assist in putting those into a broader justice context.

Ms. Heather Smith: Within those 33 projects, a number of projects have generated more than one application for judicial review, as the Red Hill Creek case did. It generated 3 separate applications, but they were all heard at the same time. In total, we've had around 55 applications for judicial review relating to the Canadian Environmental Assessment Act.

From the Government of Canada's perspective, if you look at the volume of litigation that the government has and at the particular areas in which it has it, this is not a significant load of litigation. It is considered to be significant for individual projects, but it's not unusual that a new piece of legislation would generate litigation. This is not an unusually large number of cases.

Mrs. Karen Redman: Thank you. I can certainly see how this could be a major wrinkle or bump in the road for an individual proponent or project and could cause them to reassess what they're doing, but sometimes I think there's an industry perception that there's a real glut of litigation that follows CEAA. Clearly, that hasn't been the history to date.

Ms. Heather Smith: Not in our view.

Mrs. Karen Redman: Thank you, Mr. Chairperson.

The Chair: Thank you.

[Translation]

Madame Scherrer, please.

Ms. Hélène Scherrer (Louis-Hébert, Lib.): Thank you very much, Mr. Chairman.

I would like to get back to a point you mentioned in your presentation that seemed to be a problem, particularly in this project but also possibly in future projects. It is the definition of the term “project”. The word is often defined in general terms as referring to something that is to be carried out in the future. As long as a project is not completely implemented, the process is still called a project, which seems to be a problem here. So I would like you to clarify this. Are we talking here about a project simply at the planning stage? Once implementation begins, is it still a project? Is there a better definition in the new bill or does a project still go beyond the planning process? At what time does a project cease to be a project and starts becoming a concrete action?

Ms. Heather Smith: The court's reasoning in the Red Hill Creek case was based on the English definition of “project” because they used the word “proposed”.

[English]

The act says, “proposed construction...or other undertaking”.

[Translation]

If the same concept is in the French version, it can be found in the word “réalisation”, but this word is not mentioned. No change of the definition of “project” is contemplated in Bill C-19. We intend to propose a way to clarify the interpretation of the English definition of “project”.

Ms. Hélène Scherrer: I will get back to your definition. To me, the word “project” refers to something that is still being developed and implementation is the final step because when a project is implemented, it means it is completed. Here we have a very long period of time which can be very harmful since planning refers to a proposal on a piece of paper, while implementation is the final step when you drive the last nail. If the act does not define the period elapsed from the time a project is described in writing to the time it is implemented, then people will very easily circumvent the law. They will go to court at any time and win since planning is done in your head and not in the field. If implementation means a completed project, then this period of time is awfully long. And without a definition in the new bill, any project will slip through the crack because we're still at the project stage.

À (1005)

Ms. Heather Smith: Mr. Chairman, the question does capture the problem in the concept of a “project”. There are many points that can be a source of uncertainty. We thought about it and we believe we came up with a solution. We want to specify that, for the purposes of the CEAA, a project is something that is submitted for a federal decision. No matter what other decision-makers have decided, only federal decision-makers will determine whether a process is a project for the purposes of the CEAA. As you have shown, definitions can often be challenged so we're trying to prevent that with our proposal.

Ms. Hélène Scherrer: I will conclude with this. Having worked at the municipal, provincial and federal levels, I know there are countless projects. Everybody has a project. I don't know which level of project is supposed to trigger the federal act but you know as well as I do that everyone has a project. If a project is just an idea you put in writing, we'll never be able to deal with the policy that will be established.

At what time is a project viable enough to be considered? Is it after a first action? Is it when a budget is voted? Is it when an authority decides to bring it forward? This another area of uncertainty.

Ms. Heather Smith: I think the area is not as grey as we thought it would be. In order to trigger the CEAA, there must be a federal decision. When it is clear that a federal decision is needed, then you can see what is to be done. Is it a project for the purposes of the CEAA? There are elements in the definition of a project that you can't miss, and the act applies to these elements.

Ms. Hélène Scherrer: Was there ever a link between the act and the time when funds are requested? As a rule, a funding application means you're really serious about the project, whatever level the application is submitted to. Is there anything linking the act to a funding application?

Ms. Heather Smith: Yes. Under the act, one of the triggers is a funding application. In fact, it is the review of an application by a federal authority that triggers the act since the act only concerns federal decision-makers.

Ms. Hélène Scherrer: It does not have to be a funding application at the federal level. It may be an application at any level.

Ms. Heather Smith: That would not trigger the federal act which only concerns federal decision-makers and which sets a procedure to be followed before a decision can me made at the federal level.

Ms. Hélène Scherrer: Does that mean that a locally-financed municipal project may altogether escape the CEAA even if it's a major project?

Ms. Heather Smith: It depends on whether or not you need a federal decision. In the case of Red Hill Creek, for instance, they needed an authorization under the Fisheries Act, which triggered the Act.

Ms. Hélène Scherrer: All right. Thank you.

The Chair: Thank you, Madame Scherrer.

[English]

We'll start the second round shortly.

It is worthwhile to examine for a moment some of the reasoning presented by Justice Dawson. In doing that, I will bring up a couple of examples that flow from the questions asked by Madame Scherrer as well. For instance, on page 36, in item 167 of her ruling, the judge notes:

The Region and Ontario correctly note that nothing in the MBC specifically refers to the protection of migratory bird habitat.

This is accurate, but it is strange that the judge does not refer to the Migratory Birds Convention Act, which, in my recollection, does refer to habitat in its text. It may not do so in a manner that is as conclusive or precise as we would like it to be, but the act definitely does refer to habitat.

In the last paragraph on the next page, page 37, we then find this statement:

This does not necessarily mean that removal of the site will have an effect on provincial bird populations, but rather that development will likely affect the use of the site.

Well, this is splitting hairs almost in an acrobatic manner. Obviously, the removal of 40,000 trees.... How can the removal of 40,000 trees not have an effect on the bird population? I also like this reference to “provincial bird populations”, because, you see, there can be municipal bird populations, as well as national bird populations and international bird populations. This is a mindset that is fascinating. To make this kind of distinction is almost perverse.

And then you find another gem at the top of page 38:

Unfortunately, there is a total absence of literature on the effects of these types of developments on migrating birds, so...

—and the rest is underlined—

it will be difficult to make a strong case whether or not the proposal will have significant effects after attempts at mitigation are taken.

Well, perhaps it seems to indicate that we cannot exercise a judgment unless we have a study. That is the logic of that paragraph. The removal of 40,000 trees and of wetlands and other ecologically fragile habitats does not seem to be able to tell a judge that there is something from which we could draw some conclusions without waiting for a study.

On the same page, the third paragraph from the bottom reads:

It is equally difficult to accurately predict the effects of a reduction in wetland area in the Van Wagner's Ponds and Red Hill Marsh area,

and so on. Well, that is therefore another reason to rely on one's own capacity to observe rather than waiting for studies that you, yourself, the judge, say it is difficult to accurately predict.

Would you like to comment on those, please?

À (1010)

Ms. Heather Smith: One thing I think I should point out to you, Mr. Chairman, is that the judgment is quoting from material written by Environment Canada scientists, in the context of the environmental assessment. As a member of one profession that has often been accused of not speaking clearly, I can now throw that out and accuse another profession of not speaking clearly. In fairness to the scientists, though, they were speaking to each other, scientist to scientist, and were applying this scientific standard of certainty that they require in order to make definitive statements.

But what you've quoted are statements from reports that were done in the context of the environmental assessment, for the purposes of trying to figure out whether effects were significant or not. The judge is looking at those in the context of a judicial review application and is trying to interpret what the scientists say in those scientific documents for the purposes of statutory interpretation of the Canadian Environmental Assessment Act.

À (1015)

The Chair: Are you referring to the statements on page 38?

Ms. Heather Smith: The paragraphs that you have quoted from are quotes from scientific evidence supporting the advice prepared by Environment Canada. I think you quoted item 172 of the judgment.

The Chair: So that paragraph at the end of item 172 is a quote.

Ms. Heather Smith: Those are all quotes from Environment Canada scientists, in the context of the environmental assessment. The judge quoted them in the decision in order to support her interpretation of the act.

The Chair: Do you have the text before you?

Ms. Heather Smith: I do, yes.

The Chair: And you are pointing to the paragraph that begins, “It is equally difficult”? Is that a quote?

Ms. Heather Smith: I'm not sure what the—

The Chair: Well, to me, it doesn't look like a quote.

Ms. Heather Smith: I guess it depends on what version of the printed decision you have. The version that I have indicates that it's item 172. On my version, it's indented and it's in smaller type.

The Chair: This is not indented.

Ms. Heather Smith: Mr. Chairman, the copy that you have came off the Internet. Looking at that copy of the decision, I can see that it's difficult to read. I believe—

The Chair: All right, let's leave that in abeyance and move to item 176 on page 39. If I interpret it correctly, the judge writes:

I cannot find sufficient proximity between migratory bird concerns and establishing independently the need for the Expressway.

Ms. Heather Smith: Yes, those are definitely the words of the judge there.

The Chair: Right, so one would wonder what the degree of sufficient proximity is that would convince a judge that there is a link between the two. Certainly the removal of 40,000 trees should be a sufficient indicator to a normal observer.

On page 40, in item 180, it's also worthwhile bringing this to your attention:

Public concern focussed on the need for and alternatives to the project, areas of exclusive provincial jurisdiction, could not in my view support the exercise of federal authority referring the project to panel review.

Evidently, the fact that the public concern focused on the need for an alternative is not sufficient and does not support the exercise of a federal authority. It's as if there is a public concern that is provincial and is quite different from a public concern that might be federal. Again, it seems to me to be a spurious form of distinction. If a public concern is federal, it does not apply. In other words, Canadians concerned with migratory birds have no say in this kind of examination, of exercise. That would be my way of interpreting the thinking of the judge, but maybe you can correct me.

Ms. Heather Smith: I don't think I have anything to add to what you said.

The Chair: Finally, the next puzzling sentence appears on the same page, at the end of item 180:

Based upon the facts that you have provided to me, it appears that public concern is over matters that are entirely provincial. In such a case, I would not recommend referral to public review.

There seems to be an inconsistency between the first paragraph in 180 and the last sentence in 180. It's either one or the other. Maybe you can interpret it for me.

À (1020)

Ms. Heather Smith: There again, in the version that you have before you, which is printed off the Internet, it's not clear. The judge starts off that paragraph with her own words, and then she quotes. The introduction to the part that you just read says, “As legal services advised the Department of the Environment:”, and that's followed by what you just read at the end of the paragraph.

The Chair: Thank you.

We'll go to the second round, beginning with Mr. Mills, please.

Mr. Bob Mills: What the chairman has raised is rather puzzling. The obvious question that arises from it is whether or not the scientists or the judge visited the site and actually looked at it before writing what they wrote. It would almost appear that they were in some sort of a vacuum, not understanding migratory birds or not understanding habitat, the importance of marshland, and so on. What the chairman has just pointed out is rather strange, you know. I guess I'll leave that question, but can you possibly tell me if the judge visited that actual site?

Ms. Heather Smith: I think I can assure you that she didn't.

Mr. Bob Mills: Okay, thank you.

This also points out something that I know is an ongoing problem when it comes to environmental assessment, and that's the provincial-versus-federal conflict that's constantly there. In going through Bill C-19, I was of the opinion that this would help to limit that somewhat and would consolidate and speed up environmental assessments.

Do you think we can, or do you think it does? Is that a correct interpretation? What can we do to prevent this provincial-federal conflict when it comes to environmental assessments? In many cases it seems that we duplicate, while in other cases we come up with exactly opposite points of view on an environmental assessment.

Mr. Robert Connelly: Mr. Mills, I think you raise a very good question that takes us back to the comment the chair made about the problem of trying to sort out whether we're dealing with federal birds, provincial birds, or municipal birds, trying to put them all in neat little boxes. That is indeed a challenge.

In many ways, what we are trying to do with changes in Bill C-19 is make it easier to work with our provincial counterparts in a cooperative manner, so that when we have a project under review, we can bring together the expertise that exists at the federal level and the expertise that exists at the provincial level, and apply all of it to a good review of the project in a wholistic way. That way, at the end of the day, we're hopefully not squabbling over whether these are indeed provincial birds or federal birds.

Of course, what we want to do in any cooperative exercise is ensure that the legal responsibilities of the province and the legal responsibilities of the federal government under our legislation are fully met. We are envisaging and have introduced means to improve that cooperation, so as to hopefully achieve a better effect in the future.

Mr. Bob Mills: Going along with that, I think it's important to involve the local people who often best know what is happening and should have that input. It appears that the input the public had in this particular case may not have been listened to all that well. Having been involved in a number of environmental assessments in which I was on the side of the local people who were presenting a point of view, often I felt the government turned the switch off and more or less said to let them rant for a little while because they would then go away and then the government could carry on. I would therefore hope this process is going to also address the idea from the standpoint that, when we say we want public input, we really mean it.

Mr. Robert Connelly: Yes, I think we can all recognize that the kinds of distinctions we have been talking about in regard to jurisdiction—federal or provincial birds, in this instance—are probably not paramount in the public's mind when they get involved in environmental assessment.

One of the things we are looking at in Bill C-19, in a number of areas, is a means to improve the ability of the public to become involved. That was one of the objectives we had at the outset of the review: to look at means to better enable public participation in the process. We feel we're doing a number of things both in changes to Bill C-19 and in commitments that are made by the minister in the report to Parliament. For example, we're currently developing some guidelines for public involvement at the screening stage of the process, and we're working with environmental groups, industry, and others, to do that.

À (1025)

Mr. Bob Mills: Thank you.

The Chair: Thank you, Mr. Mills.

Madame Kraft Sloan, please.

Mrs. Karen Kraft Sloan: Thank you, Mr. Chair.

I'm just looking at something off the CEAA website, that being the backgrounder on the appeal of the Federal Court decision on the Red Hill Creek Expressway. At the top of page 2 of 2, you've indicated the grounds for the agency's appeal. In the backgrounder, you say, “The government believes that there are errors of law in Justice Dawson's decision”.

Given the discussion we've just had around migratory birds, and in light of the earlier question that I had asked, I understand you're looking at the minimal level of tests for the law, such as whether CEAA applies or what have you. But in taking a look at this document from the website, in which you have identified a series of errors in law in Justice Dawson's decision, I'm wondering why migratory birds were not an issue listed here.

Ms. Heather Smith: As we mentioned earlier in the presentation, when we got the decision from the Federal Court Trial Division, there were two decisions by the court, two separate conclusions. First of all, it was concluded that the act didn't apply. Secondly, if she had concluded that the act had applied, our referral of the project to panel review on the basis of concerns about migratory birds and public concerns was not supported by a valid head of federal jurisdiction.

We decided not to appeal that part of the decision. We decided to focus the appeal on the first question of whether or not the act applied, because we thought that was where our strongest legal arguments were on the facts of this case. Based on what the Court of Appeal ruled in this case, I believe we made the right decision.

Mrs. Karen Kraft Sloan: So this was only listing the grounds of the appeal. You did not—

Ms. Heather Smith: That's right. We only listed the issues we were going to raise with the Court of Appeal.

Mrs. Karen Kraft Sloan: So they're only the issues for the Court of Appeal, but you feel there are still outstanding issues around migratory birds.

Ms. Heather Smith: We chose not to challenge that part of the decision.

Mrs. Karen Kraft Sloan: I understand that this issue is not part of your appeal, but you still felt there were outstanding issues on migratory birds.

Ms. Heather Smith: I think it's fair to say that when we argued before the court on that issue, we did not agree with the view that the court took of the facts of the case. The court, however, has made certain factual findings in that case that we have to accept.

Mrs. Karen Kraft Sloan: But you still have a problem with the migratory birds aspect.

A voice: [Inaudible—Editor]

Mrs. Karen Kraft Sloan: I understand that you're talking about the appeal, but I'm asking you to step outside the appeal.

Ms. Heather Smith: I understand, yes.

Mrs. Karen Kraft Sloan: I understand that these are the arguments you're putting forward for the appeal, but do you still have a problem with the issues with regard to migratory birds?

Ms. Heather Smith: Are you asking whether there's a concern about migratory birds in the case of the Red Hill Creek project?

Mrs. Karen Kraft Sloan: Yes, with regard to the decisions.

Ms. Heather Smith: I believe Environment Canada still is concerned about the impact of the project on migratory birds, but they're not going to be able to get at that through Fisheries Act authorization.

Mrs. Karen Kraft Sloan: Okay, thank you. I'll turn to the other question that I have.

Quite obviously, this decision has a bearing on the application of CEAA and the interpretation of CEAA. As we all know—and I mentioned it earlier, Chair—this amending process is always ephemeral in a way, but I'm wondering why you didn't go ahead with the final appeal.

Ms. Heather Smith: To appeal to the Supreme Court of Canada, you have to ask for leave to appeal, but there was no guarantee we would actually get leave to appeal. Seeking leave to appeal and actually arguing a case before the Supreme Court is very time consuming, and it takes a long time to get a decision. Bill C-19 was an opportunity to address that issue in what we thought was a more timely way, and we thought we would be more certain about what the result would be on the law.

When you go into litigation, you may be confident about what your interpretation of the act is, but a court may not agree with you. I think Red Hill Creek demonstrates that.

À (1030)

Mrs. Karen Kraft Sloan: May I again ask you some questions about modification and how you felt about the interpretation of modification? As you stated earlier, the court was looking at it as litigation versus modification. Quite clearly, what are the criteria or the triggers for making the decision that modification is mitigation? Number one, I'm trying to understand how this decision will affect future cases. Secondly, I'm wondering if Bill C-19 provides the greater clarity needed to deal with these problems.

Mr. Robert Connelly: In response to Mrs. Kraft Sloan's question, Mr. Chair, I would just say that, at the present time, Bill C-19 does not deal with the issue she raised. I'll just leave it at that. It doesn't deal with the issue of modification in the context of the section she's referring to, which is the grandfathering clause in section 74 of the act.

I'm going to get Heather to assist on the second part.

Ms. Heather Smith: A lot of what we've been talking about this morning is the interpretation of “modification” that Justice Dawson gave to the term in the Trial Division decision, but it was also addressed by the Court of Appeal in the Court of Appeal decision. What they did was set out a two-part test for what constitutes a modification for the purposes of section 74 of the Canadian Environmental Assessment Act.

The Court of Appeal said it had two elements. First of all, it had to be a significant change to the overall project. Secondly, there was an issue of whether or not the change overall was going to have a beneficial impact on the environmental effects of the project. The court has therefore given us a relatively simple, clear test of modification.

An hon. member: I'm going to get hearing damage here because of that alarm that's going off, Mr. Chair.

An hon. member: It's the fire alarm.

The Chair: We will suspend for now, and come back once the alarm is turned off.

À (1033)

Á (1101)

The Chair: Members of the committee, we are now both resuming and adjourning this committee meeting, in order to make room for our colleagues from the Standing Committee on Procedure and House Affairs.

Witnesses, we wish you well.

Thank you. The meeting is adjourned.