The Appellant Imperial Oil was issued a characterization order by the Respondent Minister of the Environment to undertake a site study, including decontamination measures. Imperial Oil declined to do the study, arguing breach of the rules of procedural fairness since the Minister was in a conflict of interest as he himself was being sued for damages by the present owners of the land. The appeal was dismissed. There was no conflict of interest which warranted judicial intervention and the Minister acted within the framework provided by the applicable law and in accordance with the law.

Administrative law – Environmental issues – Contaminated sites – Remediation – Decisions of administrative tribunals – Ministerial orders – Impartiality – Conflict of interest – Personal interests – Judicial review – Procedural requirements – Fairness

Imperial Oil Ltd. v. Quebec (Minister of the Environment), [2003] S.C.J. No. 59, Supreme Court of Canada, October 30, 2003, McLachlin C.J. and Gonthier, Iacobucci, Major, Bastarache, Binnie, Arbour, LeBel and Deschamps JJ.

The Appellant, Imperial Oil Limited (“Imperial”), operated a petroleum products depot until it sold the land in the 1970’s. Contamination problems arose and Quebec’s Minister of the Environment (the “Minister”) ordered Imperial to prepare at its own expense a site characterization study which included appropriate decontamination measures. Imperial declined to do the study, challenging the Minister’s Order before the Administrative Tribunal of Quebec (“ATQ”), the Superior Court and the Court of Appeal.

Imperial argued that there had been a violation of the rules of procedural fairness that applied to the Minister’s decision since the Minister was in a conflict of interest because he had been involved in the earlier decontamination work and was now being sued concerning the contamination of the site by the present owners of the land. The ATQ dismissed the appeal, but the Superior Court allowed the application for judicial review, set aside the Order, and found that the Minister was in a conflict of interest.

The Supreme Court of Canada held that there was no conflict of interest which warranted judicial intervention and the Minister acted within the framework provided by the applicable law and in accordance with the law. The contextual nature of the content of the duty of impartiality which, like that of all of the rules of procedural fairness, may vary in order to reflect the context of a decision-maker’s activities and the nature of its functions (Baker v. Canada (Minister of Citizenship and Immigration), [1999] 2 S.C.R. 817 at 837). The Environmental Quality Act, R.S.Q., c.Q-2 (“EQA”) defines the nature and extent of the procedural fairness obligations by which the Minister is bound when he issues a characterization order. When the Minister has to make a specific decision concerning someone subject to the law, he must comply with precise procedural obligations which require that he give notice to the person concerned, receive and review the representations and information submitted by that person, and give reasons to that person for his decision. However, that obligation is not equivalent to the impartiality that is required of a judge or an administrative decision-maker whose primary functions are adjudicative. On the contrary, he is performing his functions of management and application of environmental protection legislation.

With respect to the Minister’s personal interest, Pearlman v. Manitoba Law Society Judicial Committee, [1991] 2 S.C.R. 869, provides necessary guidance on the nature of the personal interest that would put an administrative decision-maker in a conflict of interest within the meaning of the principles of procedural fairness. The duty to remain untainted by personal interest applied. Here, the only interests the Minister was representing were the public interest in protecting the environment and the interest of the State, which is responsible for preserving the environment. There was no conflict of interest such as would warrant judicial intervention, let alone any abuse or misuse of power.

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