Hydraulic Fracking Blog: Alberta Chief Justice keeps fracking lawsuit against environmental regulator alive

The Honourable Neil Wittman, Alberta's Chief Justice of the Court of Queen's Bench, has ruled that a landowner is entitled to carry on her lawsuit against Alberta's Environment and Sustainable Resource Development Department (ESRD) for allegedly being negligent in monitoring and regulating EnCana Corporation (EnCana) in the hydraulic fracturing of a well, and negligent in investigating the alleged contamination of her water well.

The landowner, Jessica Ernst, originally sued EnCana, ESRD and the Energy Resources Conservation Board (ERCB) in 2007. Recently, the case against the ERCB was thrown out on the grounds that the ERCB did not owe her a private duty of care and that the legislation under which it operates provided statutory immunity.

Please review our previous blog posts on these decisions, including:

The most recent development is that ESRD applied to the Court to strike out parts of Ms. Ernst's pleadings to allegations of negligent administration of a regulatory regime and the relief sought, including damages on the grounds that they failed to disclose a reasonable cause of action. In the alternative, ESRD sought summary judgment dismissing the case against it on the basis that Ms. Ernst's claim has no merit.

The Chief Justice ruled against both motions.

With respect to the application to strike part of the pleadings, the Chief Justice noted that striking the parts of the pleadings requested by ESRD would have the effect of having the entire claim against ESRD struck. ESRD argued that the test for striking an entire claim is whether it is plain and obvious or beyond reasonable doubt that the claim cannot succeed. The Court, however, disagreed and applied a test of whether, assuming the facts pleaded were true, there is a reasonable prospect that the claim will succeed.

The Chief Justice then determined that prima facie there was a private duty of care owed by ESRD to Ms. Ernst as the allegations in the claim, assuming they are true, concern direct contact between ESRD officials and Ms. Ernst and assert that specific representations were made by ESRD to Ms. Ernst. The Chief Justice found that there were no public policy considerations which ought to negate or limit that private duty of care.

ESRD also argued that it had statutory immunity like had previously been found for the ERCB. However, the legislation under which ESRD operated was different than that of the ERCB, and that the provisions granting immunity only applied for acts and omissions of ESRD undertaken in good faith. As Ms. Ernst alleged that the ESRD had acted in bad faith, and as the Court presumed the facts alleged to be true for the purpose of the motion, the Court ruled ESRD did not have statutory immunity.

As for the summary judgment application, the Court applied the rule that a defendant is entitled to summary judgment when there is no merit to the claim against it. The Chief Justice noted that the onus was on ESRD to establish that there was no genuine issue requiring a trial, and that ESRD had failed to satisfy him that there was no merit in Ms. Ernst's claim.

Meanwhile, Ms. Ernst is trying to get the Supreme Court of Canada to hear her appeal of the decision allowing the ERCB to exit the lawsuit as an application for leave to the Supreme Court has been filed by Ms. Ernst.

This post was written by Alan Harvie (alan.harvie@nortonrosefulbright.com or +1 403.267.9411) from Norton Rose Fulbright's energy practice group.