“To Dance In The Shadows Of The Law’s Ambiguities”

For the past few weeks I felt I entered a Kafkaesque world, having attended 10 days of sessions
at the Supreme Court of British Columbia in the case between the Shawnigan Residents
Association (SRA: the Petitioner) and the Director, Environmental Management Act; Cobble
Hill Holdings Ltd. (CHH); and the Environmental Appeal Board (EAB) – all known as the
Respondents. On the wall of the courtroom is the coat of arms of Queen Elizabeth II containing
in large text “Dieu et mon droit” (God and my right) derived from Richard I’s battle cry and does
illustrate that the courtroom is a battleground, albeit legal. In smaller and somewhat hidden text
is the Norman-French maxim “Honi soit qui mal y pense” that translates as ‘Shame on those that
think evil of it’ but commonly used in contemporary French to insinuate hidden agendas or
conflicts of interest: a very apt motto for this case.

At least eleven lawyers were involved, two for CHH, two for SRA, three (and maybe four)
different lawyers have appeared for the Director and the EAB, two for South Island Resource
Management (SIRM), the current operator of the contaminated soil dump and who wish to have
standing in the case and one lawyer for Active Earth Engineering (AEE). On Friday, January 22,
2015 a lawyer representing the Malahat Nation entered the case. He argued for the admission of
an affidavit and wants to have standing for the Malahat Nation.

One might expect that the Government lawyers would have the interest of the people in mind but
it was clear that they were sitting on the fence, certainly not supporting the people of Shawnigan
Lake. Presiding over the Court was Justice Robert J. Sewell.

One entity that weaves in and out of this narrative is South Island Aggregates (SIA). SIA ran the
mining operation on Lot 23 at 460 Stebbings Road owned by CHH. SIA also played an
important role in obtaining the Permit. Both SIA and CHH are owned by Mr Mike Kelly and Mr
Martin Block. In addition, there is the Delegate, Mr Hubert Bunce, appointed by the Director of
the Environmental Management Act. Another key individual that weaves in and out of this
narrative is Mr Luc Lachance, Authorizations Section Head, Mining Operations of the Ministry
who helped CHH/SIA stick-handle the application for the Permit through the regulatory process.

The issue at hand is that the Director has given CHH the Permit to allow the dumping of
contaminated soils in the Shawnigan watershed, much to the dismay of the Shawnigan Lake
residents. This Permit allows the dumping of 100,000 tonnes of contaminated soil per year for a
50-year period, i.e., the dumping of five million tonnes of soil containing toxins in a watershed.
Such contaminated soil may contain organic toxins such as chlorinated hydrocarbons (e.g.,
PCBs) and nasty metals like cadmium. There was an appeal and the Environmental Appeal
Board (EAB) upheld the decision to issue the Permit to CHH. The SRA wants the decisions by
the Director and EAB to be stayed by the Judicial Review. The case involves more than toxin
dumping as Mr Robert Anderson, one of the SRA Counsels, pointed out, it involves fraud and
perjury (alleged as pointed out by the judge). The ‘alleged’ fraud involved, amongst other
things, the concealment of a secret agreement between Active Earth Engineering (AEE) and
CHH/SIA to share in the profits derived from the contaminated soil dump.

Creative Flexibility In The Use Of ‘The Science’
The Permit was issued by the Director and upheld by the Environmental Appeal Board (EAB)
because of the belief that the ‘Science’ suggested there was only a very low probability that the
Shawnigan watershed would become contaminated. One argument that is present in the
Technical Assessment Report (TAR) prepared by Active Earth Engineering (AEE) was that the
geology indicated a 75-metre fracture-free impermeable bedrock beneath the site where it was
proposed to dump soils laden with contaminants; hence, it was stated that the contaminants could
not migrate down to underlying aquifers, if there were such aquifers. In the executive Summary
of the TAR: “The very low permeability of the upper bedrock (K = 7.6 x 10-10 m/s) provides a
high level of protection to the groundwater flow within the deep bedrock (K = 1.6 x 10-7 m/s).”
(paragraph 4, p. 8). This turned out to be wrong as it is now admitted that some fractures exist in
this bedrock (note EAB Report: “The Panel accepts the Appellants’ evidence that there is not a
75 metre low permeability layer beneath the Site as stated in the TARs.” (paragraph 1, p. 65).

In the Quarterly Monitoring Report to the Ministry, dated May 26, 2015, AEE reports the
finding that ground water levels are several metres above the proposed bottom of the
landfill site; this is totally contrary to what the Engineers write in the TAR that contained the
‘science’ for the Permit application. As reported by AEE: “The implication of this observation is
that any water-bearing fractures would convey flow upward into the pit, this eliminates the
pathway for dissolved contaminants (if present) to migrate downward, into the groundwater
beneath the Site” (penultimate paragraph, p. 4 of the Report). So, no matter what the findings,
the ‘Science’ is manipulated to support the CHH/SIA application for the Permit. The Ministry, as
is usually the case, went along with AEE and CHH/SIA. Not noted in the report was that this
would increase the probability of contaminants flowing offsite, ultimately ending up in aquifers
and/or into Upper Shawnigan Creek that empties into Shawnigan lake. AEE would have argued
that great care is taken to ensure that such ‘contaminated’ surface water would be treated before
release into the environment. This, however, did not happen during November, 2015 when the
routine November rains resulted in surface water running off the Site (letter of Non-Compliance
from the Ministry to CHH dated November 18, 2015). And probably did not happen during the
more recent January rains, as indicated by water flow patterns seen in photographs of the site
taken by local residents. This information was submitted to the Ministry of Environment (MOE);
however, well more than 10 days later we have not yet heard a response from MOE.

In addition from this same Lachance review of the TAR: #1) “The current HWR precludes the
3 construction of secure landfills within Category 1 community watershed.” (first line of first
paragraph, p. 53). Note that HWR stands for Hazardous Waste Regulation. #2) “Section 25(8) of
the HWR also precludes the construction of secure landfills where record of precipitation
statistically exceeds evaporation and transpiration. This assessment was not done for this site as
the proposed facility was not considered a secure landfill, as defined by the HWR.” (last
paragraph of p. 53). Luc Lachance is arguing that the proposed contaminated soil dump will not
be a secure site; hence, the proposed contaminated soil dump can be built in a watershed. If it
were a secure site then presumably it could not be built. This is ‘Alice’s Adventures in
Wonderland’ logic.

What Science Was NOT Done
There was no detailed ecological risk assessment of the Site. Protocol 20 of the BC Ministry of
Environment for Contaminated Sites outlines the details of ecological risk assessment for sites
that are already contaminated. I could not find any regulation that states that an ecological
risk assessment must be done for a site before contaminated soil is dumped there; this
deficiency needs to be addressed by the regulations. However, once contaminated soils are
dumped in a landfill site, then the site becomes contaminated: this is logical. On this basis I
argue there is a legal requirement to do a detailed ecological risk assessment before such a site is
considered suitable to receive contaminated soils but, for sure, this assessment is required once a
load of contaminated soil has been dumped. No such detailed ecological risk assessment has
been done on the Upper Shawnigan Creek that runs through Lot #23 to ultimately empty into
Shawnigan Lake. There was no assessment made on the wetlands associated with this creek.
Appendix C of the TAR outlines the very superficial ecological assessment that was done of the
ephemeral stream. If you read the main body of the TAR and not Appendix C, then it appears
that a sound ecological risk assessment was made: “Thomas has conducted a detailed site
assessment to review the existing conditions downstream of the Site and the potential impact and
risk to the environment.” (paragraph 1, p. 100). A reasonable person would consider this to be
very deceptive.

Discrepancies in Scientific Analyses of Metals Between MOE and CHH
The differences in analyses were outlined in the June 2015 Compliance and Monitoring
Summary sent by MOE to CHH. Curiously, the Ministry states: “In summary, the differences
between results from recent MOE sampling in May 2015 and results from CHH sampling in
April 2015 and April 2014 had no discernable pattern……there was little consistency in how the
MOE lab results deviated from the CHH results. Concentrations were considerably higher for
some parameters and much lower for other parameters.” Actually a reasonable person would say
this is not the case (see Table 1 below, taken from the Summary). When examining metal
concentrations in wells M1S and M2, the Ministry values are anywhere from 12 to 116 or more)
times higher than CHH in 8 out of the 10 metals analysed. Only with Well 3 are the results (for
manganese) similar. So, again, we have questionable science, in this case scientific analysis. And
again we seem to have the Ministry determined to support the Permittee no matter what.



The Science NOT Considered
The Technical Assessment Report (TAR) states: “The literature has been thoroughly reviewed
and it is concluded that the anticipated chemical parameters and concentrations potentially
encountered at the proposed facility will not pose a risk to liner integrity.” (paragraph 1, p. 46). I
have reviewed the literature and found that many organic molecules allowed by the Permit can
attack the integrity of the 1.0 millimeter (40 mil) thin polyethylene liner; such molecules include:
phenolics, chlorinated hydrocarbons, benzene, toluene, ethylbenzene and polycyclic aromatic

Further, there is an assumption that since water cannot pass through the polyethylene liner,
contaminants cannot. There is also an underlying assumption that the thin 1.0 millimetre
polyethylene liner will last for centuries. In actual fact, provided there is no puncturing or tearing
of the liner, its life expectancy is measured in decades, not the centuries the contaminated
landfill site will exist. Note from the Environmental Appeal Board (EAB) Report: “The
importance of the protective liner between the contaminated soil in the cells and the bedrock is to
prevent any contaminated soil or leachate, from entering the environment without treatment.”
(paragraph [515], p. 86). I have found scientific articles that indicate that organic contaminants
can pass through this thin 1.0 millimetre liner. Note that the EAB Report repeatedly and
incorrectly states this is a 40 millimetre liner, see: paragraph [513], p. 86; paragraph 491, p. 83;
paragraph [102], p. 19; and paragraph [94], p. 18.

I have also found research scientific papers that describe the movement of contaminated waste
molecules through a metre of clay till such as used in landfill sites. Acetone and dioxane, for
example, diffuse through one metre of clay till within 5 years. Hence, Todd Miziuk’s statement
to the Port Moody Council on January 12, 2015 that the clay will act as a barrier for a billion
years is ludicrous.

A major component of the ’alleged’ fraud is the attempt to conceal the fact that Active Earth
Engineering (AEE: the Qualified Professionals presumably acting at arms-length in assessing the
suitability of Lot 23, Stebbings Road for receiving soils contaminated with toxins and in
performing the public consultations) had engaged from the very beginning in discussions with
CHH/SIA to share equally the profits arising from dumping of contaminated soils. The evidence
for this as brought forth by Mr Sean Hern, Counsel for SRA, includes the following documents
submitted to the Court: an unsigned Joint Venture Agreement effective as of November 1, 2010;
a modified unsigned Joint Venture Agreement effective September 1, 2011; a 2012 undated and
unsigned agreement between AEE, SIA and an Operating Company; a signed detailed agreement
between AE Newco (an AEE offspring), SI Newco (an SIA offspring), CHH and the Operating
Company called OPCO dated September 10, 2012; an agreement signed February 14, 2013
amongst AE Newco and CHH, SIA and OPCO ; a draft agreement from July 2015 that included
AEN, OPCO, SIA and SIRM. Note most of these various agreements, signed and unsigned
starting from the fall of 2010, were in existence during the Environmental Appeal Board (EAB)
hearings and earlier, but were concealed from the SRA and the Government. In addition, many
emails amongst the parties discussing the partnership and financial relationships as well as
involving quarrels amongst the partners as to the value of their contributions were submitted to
the Court. A reasonable person would agree that there clearly was a partnership between AEE
and CHH/SIA. Both Counsels for CHH argued there was no partnership despite signed
documents and emails since there were some disagreements amongst the principals and, thus,
there was no ‘meeting of the minds’; the signings of the documents were done merely to reassure
each of the principals. Parenthetically, if I were to sign a contract and then wished to back out
because there was no ‘meeting of minds’, would lawyers then say there was no contract? I think

Keep in mind that at the time of the EAB hearing the existence of these documents were not
known. They were only exposed through a Court order following the deposition, during June
2015,of an envelope containing a copy of the ‘secret agreement’ dated February 14, 2013. This
agreement outlined how AEE operating through a company called AE Newco contracted with
SIA and CHH to form a company called OPCO. This agreement provides that CHH be the
Permit Applicant (prior to this SIA was the applicant for the Permit) but would act as a trustee
for OPCO that would be the owner of the ‘beneficial interest’ in contaminated soil landfill.

Counsels for CHH argued that this financial relationship was of no consequence to the decisions
made by the Delegate acting for the Director of the Environmental Management Act and by the Environmental
Appeal Board (EAB) for the following reasons:

  1. Even with a financial interest at stake in the Permit, AEE are ‘Qualified Professionals’
    and like any professional would give a true assessment of the suitability of the site and
    the suitability of the design. If you look at the Summary of the Public Consultation
    document prepared by the Engineers and submitted to the Delegate during November
    2012 by SIA, a reasonable person can readily see the bias. For example, the document
    said that feedback was “provided by less than 10% of the local population …. This
    indicates a high degree of indifference to the proposal by the local population…… Key
    support for the proposal was expressed by the Malahat First Nation, local contractors and
    developers and some open-minded individuals ……”. Note that if you were for the
    proposal you were open-minded and by implication if you were against, you were closeminded.
    Further, some of the comments submitted by the public at the May 31, 2012 are absent from this
    Summary of Public Consultation document. I urge the reader to compare
    the AEE Summary with the Minutes of the Public Consultation organized by the CVRD
    on July 12, 2012 which gives a very different picture of the public interest and of the
    response to the proposed contaminated soil dump as painted by AEE. The Delegate, Mr
    Bunce, should have taken note of the bias early on in the process, but did not. Clearly,
    any reasonable person would say there was a bias towards the proposal by AEE from the
    very beginning: AEE engineers were not acting as arms-length Qualified Professionals.
    Counsel for the SRA has argued that the community must be consulted and consultation
    means you listen to people. I think that the community was not listened to and, thus, not
    consulted, as witnessed by a petition containing more than 15,000 names and the many
    hundreds of thousands of dollars raised to fight the Ministry and CHH in order to protect
    the watershed.
  2. CHH Counsels argued there is no evidence that the Delegate or the EAB would have
    made different decisions if they had been made aware of the financial interest.
  3. They also argued that the evidence of the financial relationship should not even be before
    the Court since knowledge of this information was obtained through a document that was
    ‘stolen’. Justice Sewell did point out that the documents before the Court were produced
    through a judicial order. One might question how else SRA would become aware of the
    financial relationship if it were not for this ‘stolen’ document.
  4. CHH Counsels also argued that if Counsels for the SRA had been diligent enough at the
    EAB hearing they could have discovered the relationship. They argued that since the
    SRA lawyers did not practice due diligence then, according to the Palmer Test, this
    information should not be considered by the Court.
  5. Counsels for CHH further argue that the only conflict of interest Professional Engineers
    need to report, according the Professional Engineers Code of Ethics, is to their employer
    or client, the client being in this case CHH/SIA. Hence, there was no obligation to report
    the conflict of interest to the Delegate or the EAB. And this they argued many times over
    the 10 days of hearing. The Judge did say that perhaps their Code of Ethics did not
    require disclosure of the financial relationships between AEE and CHH/SIA but there
    was a conflict of interest.
    Counsel for the SRA pointed out that the Ministry Guidelines on Professional Advice
    points out that where there is a possible bias this should be exposed. SRA’s Counsel also
    argued that Code of Ethics of the Professional Engineers & Geoscientists of BC Article 5
    (Uphold the principle of appropriate and adequate compensation for the performance of
    engineering and geoscience work) suggests they should not engage in a fee on a
    contingent basis.

Counsel for the SRA repeatedly pointed out Lord Denning’s ruling that: “No Court in this land
will allow a person to keep an advantage he has obtained by fraud. No judgment of a court,
no order of a Minister, can be allowed to stand if it has been obtained by fraud. Fraud
unravels everything.” However, this ruling is continued by: “The court is careful not to find
fraud unless it is distinctly pleaded and proved; but once it is proved it vitiates judgments,
contracts and all transactions whatsoever; …”. So we come to the issue of was there a “meeting
of the minds”; only a lawyer could bring this up.

Parenthetically, according to Section 18-3.e of the BC Environmental Management Act the
Minister has the power to cancel the permit if: “a holder of a permit or an approval or the
holder’s agent has made or makes a material misstatement or misrepresentation in the application
for the permit or approval or in the information required under this Act with respect to the permit or approval”.

You may be asking why Active Earth Engineering (AEE) found it necessary to form the AE
Newco subsidiary. Counsel for the SRA brought up the affidavit filed in the Court on November
5, 2015 (# 4 by T. Webb) that contains, amongst other documents, 2 emails from a lawyer acting
on behalf of AEE. One dated 9/11/2012 deals with establishing the new company called Active
Earth Newco or AEN. Why is it necessary, you may wonder, to establish a new company. The
reason for this becomes clear in an earlier email dated 7/10/2012: “That approach respects the
sensitivity of our client’s involvement with the application (as consulting engineer) rather
than as owner”.

The Counsel for the SRA pointed out that the testimony of the CHH owners given in affidavits
differed considerably with the information obtained in documents obtained through a Court
order: there are too many differences for me to even begin to list. The SRA Counsels were
concerned with (alleged) perjury and how this affected the trustworthiness of the Permit Holder.
CHH Counsels essentially argued that the owners of CHH/SIA had a naïve view of what is
meant by such terms as a bill and invoice and other financial matters and so the testimony that
differed from the documents filed simply indicated a ‘confusion of the mind’. Similarly, the
differing testimonies in the several affidavits filed were due to ‘confusion of the mind’. A
layperson would think that businessmen in business for many years would be familiar with what
terms such as bill and invoice meant. Curiously, later the CHH Counsel did also argue that just
because someone told an ‘untruth’ and was a ‘bad’ character does not mean he could not be a
trustworthy Permit Operator. One begins to see why I had thoughts of having had tumbled
through Alice’s rabbit hole while listening to these arguments made by the CHH lawyers in

The Counsel for CHH repeatedly stated throughout the proceedings that all transcripts and
documents that involved the Permit must be considered and not just the abstracts that make the
arguments; this is necessary in order to render a ‘fair’ decision. Justice Sewell pointed out that it
is not physically possible for him to read all the documents. They also argued that evidence not
presented before the EAB is not admissible. The independence of AEE was not raised by the
EAB and, therefore, cannot be raised in this proceeding. CHH Counsels also said that SRA
Counsels did not do due diligence (part of the Palmer Test) during the EAB hearings. The Judge
asked that if the Petitioner requested a class of documents and they were not produced how can
this be called not doing due diligence. There were arguments by CHH Counsel that there is no
protocol defining conflict of interest for Professionals. At one time the Counsel for CHH also
argued that Counsel for the SRA did not define fraud. Counsel for CHH also argued that the
EAB gave no weight to the AEE Technical Assessment Report (TAR) and only paid attention to
the Qualified Professionals of the Ministry and those brought forth by the SRA. We are expected
by the CHH Counsel to conclude that even if AEE was biased, it does not matter since the EAB
did not pay any attention to the AEE’s TAR and relied only upon other Qualified Professionals
in their decision. I should point out that in the EAB Report there are over 260 mentions of either
AEE or the TAR and since the other Qualified Professionals all stated that more research on the
site was needed, the EAB clearly relied on the work of AEE.

Listening to the overwhelming amount of detailed obfuscations by the Counsels for CHH
reminded me of what Jethro Lieberman wrote in the book ‘Crisis at the Bar’: “The only secret
that the lawyer really possesses about the law is that no one can ever be certain of what the law
is…. The lawyer is accustomed to the ways of bending and changing rules to suit his (or his
client’s) purposes, to dance in the shadows of the law’s ambiguities.”


Ensuring that the Law is Followed
Amongst the documents submitted to the Court was that of payment to an unnamed lobbyist.
This lobbyist was to be paid $0.25/tonne of contaminated soil deposited in the landfill site at Lot
#23. You do not need to be a mathematical genius to figure out that at 100,000 tonnes/year this
would come to $25,000/year and over a period of 50 years this would amount to $1,250,000 if
the lobbyist were to be paid for the 50 years that the contaminated soil could be dumped.

BC has a Lobbyist Registration Act where a lobbyist must register:

“Within 10 days after entering into an undertaking to lobby on behalf of a client, a consultant
lobbyist must file with the registrar a return in the prescribed form and containing the
information required by section 4.” (section 3 (1))
“A “consultant lobbyist” means an individual who, for payment, undertakes to lobby on behalf of a client”
Where payment means:
“payment”, subject to section 2.1, means money or anything of value and includes a contract, a
promise or an agreement to pay money or anything of value, but does not include a
reimbursement of expenses;”

When Counsel for the SRA asked for the name of this lobbyist in Court on January 15, 2016,
Counsel for the CHH vigorously objected and argued that just because someone knows someone
within the government and advocates for the permit, it does not mean he is a lobbyist. This is a
very different interpretation of the Act than what a layperson would have. When I questioned the
Lawyer representing the Ministry of the Environment if the Government would pursue the name
of the lobbyist, I was informed that this was up to the Counsel for the SRA. So clear flouting of
the Law is of no concern to our Government and it is up to the people to address this unlawful
behaviour. As Alice would say: “Curiouser and curiouser!”

Monitoring of Contaminated Soil Sites
Many times during the past two weeks Counsel for CHH stated that the Ministry of the
Environment continually monitors the site to ensure the safety of the environment. This simply is
not true. The Permit requires self-monitoring and any non-compliance of the Permit must be
reported immediately by the Permitee to the Ministry. This is like putting the weasel in charge of
the henhouse: it does not work. As an example, on November 18, 2015 the Ministry sent a letter
about CHH’s failure to report surface water run-off. It seems to be left up to the Shawnigan Lake
residents to ensure that there is compliance with the Permit.


A Judicial Review is where “A Supreme Court Justice decides whether the tribunal or decision
maker had the authority to make the decision it did. It is not an appeal” The Judge has to decide
in this case whether the Delegate and the EAB had the appropriate information to make the
decisions that were made. So he has to decide whether the ‘alleged’ fraud, lies/perjury and secret
agreements had influenced the science put before the Delegate and EAB. A dilemma is to
determine how much of the AEE’s TAR can be relied upon in the context of the ‘alleged’ secret
agreement. The Judge commented to the SRA Counsel that if a liar says the sun rises in the east,
is this not the case? He further says that everything that AEE did was subject to scrutiny.
Counsel for the SRA says that one cannot unscramble an egg. The Judge said that this was not an
apt metaphor. The Judge asked whether the AEE design is irrelevant because they are ‘allegedly’
dishonest people. SRA Counsel says that we do not know how some of the misleading evidence
might have affected the decision. The Judge questions how the incontrovertible aspects of the
design are tainted. The SRA Counsel later states that it is almost impossible to determine what
can be relied upon from AEE’s work and thus every aspect should be questioned. The Counsel
for the SRA brought up Madame Justice Newberg’s comments that the interests of justice must
be served (the context was in introducing fresh evidence), but I am afraid that what is being
judged is not whether the decision to issue the Permit was just but whether the proper process
was followed.

This to-and-fro is of great concern to me. Perhaps what will help tilt the decision of the Court is
that on January 22, 2015 Counsels for the SRA and the Malahat First Nation introduced an
affidavit from Maxine Caroline Harry, newly-elected Chief of the Malahat First Nation which
states: “I believe that, if true, these allegations call into question the independence of the science
used to assess the application for the contaminated soil permit.” The allegations being that of
AEE’s financial interest in the outcomes of the Permit decision. Chief Harry further goes on to
say: “I believe that this stay is necessary to allow Malahat to understand whether Active Earth’s
independence has been compromised, and to determine, in consultation with the Project’s
proponents and the Crown, whether any reassessment of the Project by the Ministry of the
Environment is warranted.”


Keep in mind Justice Sewell’s comment that the fraud and perjury are still only allegations. Until
a Court rules on this matter we are dealing only with allegations despite the fact that the
documents supporting fraud and perjury have been submitted to the Court. We await February 15
when the Court resumes this case.

This case would have led me to lose all respect for lawyers were it not for the actions and words
of the Shawnigan Residents Association lawyers, Mr Robert Anderson and Mr Sean Hern. I can
only hope that the decision by Justice Sewell will result in the justice that the people of the
Shawnigan Lake Watershed yearn for.

Bernhard H.J. Juurlink
Mill Bay, BC
February 2, 2015