Directors Plead Guilty

Written by on November 19, 2018. Posted in Environmental litigation and enforcement

On November 5, 2018 two directors of a dry-cleaning operation pled guilty to contravening the Tetrachloroethylene (Use in Dry Cleaning and Reporting Requirements) Regulations under the Canadian Environmental Protection Act, 1999 (“Regulation”).

One of the directors was fined $10,500 a portion of which related to a guilty plea for obstructing an enforcement officer. The other director was fined $5,000. The total fine of $15,500 will be directed to the Environmental Damages Fund.

During an investigation of a Pickering dry cleaning operation in December 2016, Environment and Climate Change Canada enforcement officers discovered that the directors failed to handle tetrachloroethylene[1] in accordance with the applicable Regulation.  The investigation occurred after Environment Canada received information relating to fluid leaking from the back of the building. While the Environment Canada inspectors were conducting the investigation they discovered sludge and wastewater contained in drums that were confirmed to have a high concentration of tetrachloroethylene.

The charges related to inadequate containment and documentation relating to the dry cleaner’s use of tetrachloroethylene. However, one of the directors also admitted to the falsification of documentation during the inspection.  The falsification of documents occurred when the director was unable to produce the records requested relating to the dry cleaner’s acquisition and disposal of tetrachloroethylene after 2011.

This case does not represent the first time that directors have been charged for failing to meet the regulatory requirements.  In 2013 a director was fined $10,000 for improper storage and containment of tetrachloroethylene. In 2015 a director was fined $15,000 for improper storage of tetrachloroethylene contrary to the Regulation.

In 2016, Environment Canada sought a four-month condition jail sentence against an owner of an Edmonton dry cleaning facility who pled guilty to contravening the Regulation. Environment Canada sought the conditional jail sentence as a result of the owner’s repeated non-compliance despite the owner being made aware of the Regulation and its requirements. In this case, the owner of the dry cleaning facility pled guilty to five offences under the Regulation.

In the Edmonton case, Provincial court Judge Janet Dixon concluded that the owner had prior warnings and convictions that educated him on the risk to employees and the public from the use of such “nefarious” and “insidious” chemicals.  In imposing the four month conditional jail term Judge Dixon stated “You say you care about your employees and the environment, but actions speak louder than words. PERC is bad stuff,” “You need to go to jail for this.”  The Environment of Canada officers found containers with tetrachloroethylene had no covers, no secondary containment was being utilized, and waste containing tetrachloroethylene had not been shipped out within the 12-month deadline. The owner was permitted to serve his sentence in the community under house arrest for the initial 2½ months and a daily curfew for the remainder of the sentence.

The Regulation became law on February 27, 2003. The purpose of the Regulation is to reduce releases of tetrachloroethylene into the environment. The goal of the Regulation is to require more efficient dry cleaning machines to minimize and mitigate spills, and managing the collection and disposal of residue and waste water containing tetrachloroethylene.

[1] Tetrachloroethylene, also known as perchloroethylene (“PERC” or “PCE”), is a chemical used in the dry cleaning and other industries such as textile mills, chemical production and vapour degreasing. and is on the List of Toxic Substances, Schedule 1 of the Canadian Environmental Protection Act, 1999. Exposure commonly happens through contaminated air or water, including groundwater.