Flooding is a major issue for many Canadians, often causing severe damage and consequent economic harm. The federal government has warned that extreme flooding is the new reality of climate change, and the five most destructive floods in Canadian history have all occurred since 2010.
A class action may provide flood victims with means of recovery in certain situations if fault can be attributed to a government entity. There may be government liability if an emergency response was undertaken negligently or if waterway infrastructure was negligently designed. However, establishing negligence on the part of government entities, like planning boards, municipalities, or energy corporations can be difficult, and few flooding cases have been permitted to proceed as class actions (i.e. have become “certified”) in Canada.
The recent Newfoundland Supreme Court decision Chiasson v Nalcor Energy provides useful guidance on factors to be taken into consideration by a court when determining whether common issues exist relating to negligence of government entities.
Claims against governments or related entities (planning boards, energy corporations) may be certifiable as class actions
In Chiasson, the Newfoundland Supreme Court certified a class action for flood victims against the provincial government and its energy corporation. There are three key takeaways from the decision for other prospective flood class actions:
- Expert evidence including planning reports or research studies may be critical to establishing liability in situations of allegations against government entities;
- The boundaries defining the class should likely be limited to areas where there was a similar impact from the flood and a similar government response; and
- A class action can still be the preferable procedure for resolving the common issues even where an independent assessment finds that government entities were not at fault and the government already provided a relief fund for victims.
The facts of Chiasson v Nalcor Energy
Mud Lake is a community on the Churchill River in Labrador. The river is the site of the Muskrat Falls Project, a construction project for a hydroelectric plant and transmission facilities, which is overseen by Nalco Energy, a crown corporation of Newfoundland.
On May 16, 2017, Mud Lake Road was under water, and the Province closed the road. Power was disconnected to impacted homes, and by May 17, residents of Mud Lake were evacuated by helicopter or hovercraft by the Province’s Emergency Response team.
The Province established a Disaster Relief fund to provide victims with possible coverage for losses and appointed a University professor to conduct an independent assessment of the causes of the flood. The report concluded that the flooding was due to natural causes.
In November 2017, the Muskrat Falls Project became the subject of a Judicial Inquiry, which addressed questions associated with Nalcor’s decision to recommend the Project and whether the Province was informed of the risks. The report is due December 2019.
John Chiasson, an occupant of a Mud Lake property, filed a class action on behalf of residents and property-owners impacted by the flood, bringing claims against both the Province and Nalcor. On July 11, 2019, the Supreme Court of Newfoundland and Labrador determined that the action should be certified as a class proceeding.
Expert evidence and/or research studies may be crucial in allowing questions of liability and causation to be answered in common for a class
A major takeaway from the Chiasson case is that the existence of key evidence that addresses questions of possible government liability (such as independent studies of waterway projects or emergency responses) can be crucial to a prospective class action.
In Chiasson, an engineer conducted a review of independent studies on the flood and found several factors that indicated that the Nalcor facility had an impact on the flood. As a result, the Court determined that some major questions in the case (i.e. whether the Province and Nalcor caused the flood and whether they were liable for damages) could be answered for the class as a whole rather than on an individual basis, since all class members would rely on the engineer’s evidence to argue their claims.
A class should likely be limited to areas where there is a similar impact or response
Another factor that allowed the victims in Chiasson to have their claims certified as a class action was that their properties were all within distinct zones that were impacted by the disaster, and the government response, in a similar way within a set timeframe.
The Court found that the question of whether the flood substantively interfered with the use and enjoyment of victim properties could be answered in common for the class because the nature, extent, and severity of the disruption was not unique to each person. All properties were under the supervision of the Province’s Emergency Response team in the same period and all were subject to road closures, evacuations, and loss of power.
A class action can still be the preferable procedure for flood claims even if there are other investigations or inquiries, relief funds available to victims
The Chiasson case also demonstrates that class actions can be certified even if there are other funds available to victims or multiple investigations drawing different conclusions about the flood.
The determination of “natural causes” in the independent assessment report did not automatically absolve the Province and Nalcor of liability in the eyes of the Court, as the expert evidence of Mr. Chiasson’s engineer came to contrary conclusions.
The Court also found that a class action would further access to justice, as the Disaster Relief fund may not have provided enough coverage for victim’s losses.
Finally, the Judicial Inquiry helped rather than hindered the class action. The Court found that class action would attract a greater media spotlight due to the Inquiry and could have a beneficial impact on the management of water control systems in the province.
Class actions against governments for flooding can be certified if framed correctly
The Chiasson case shows that class actions against government entities can be certified in the right circumstances. Assuming there is evidence of potential wrongdoing, if the disaster is an isolated event and questions about liability and causation can be answered based upon expert reports those questions may be determined for a class.
The problem of flooding in Canada is not going away. This year has particularly devastating in regions where there are flood risks. According to Statistics Canada major areas affected by surface flooding included Southern Manitoba, Ottawa–Gatineau, West Montréal, and Fredericton–Saint John. The number of flooded or at-risk homes in these municipalities ranged from 5 – 29%. Mud Lake itself was even the subject of another flood warning this year.
There will not always be someone to
blame for flood damage. But when flood damage happens that could have been
prevented if not for the negligence of government entities, its possible for
class action lawyers to frame claims in a way that is suitable for a class
action. And in doing so, flood victims have a real opportunity to receive
compensation and answers that they deserve.
 But see McLaren v Stratford (City), 2005 CanLII 19801 (ON SC) (2002 flooding in Stratford, ON); and Anderson v Manitoba, 2017 MBCA 14 and Pisclevich v Manitoba, 2018 MBQB 52 (2011 flooding of Lake Manitoba).
 Chiasson v Nalcor Energy, 2019 NLSC 133.
 Chiasson v Nalcor Energy, 2019 NLSC 133 at paras 7-13.
 Chiasson v Nalcor Energy, 2019 NLSC 133 at paras 59-61, and 64.
 Chiasson v Nalcor Energy, 2019 NLSC 133 at para 88.
 Chiasson v Nalcor Energy, 2019 NLSC 133 at para 111.
 Chiasson v Nalcor Energy, 2019 NLSC 133 at paras 113-114.