Decision Date: August 2, 2006

Panel: Lorraine Shore, Bruce Devitt, Robert Wickett

Keywords:  Forest Practices Code of British Columbia Act ss. 45(3)(a), 117(2), and 119.1; Forest Road Regulation ss. 12(1)(b) and 13(1)(c); sliding; slumping; drainage system; due diligence; estoppel by representation.

Kalesnikoff Lumber Co. Ltd. (“Kalesnikoff”) appealed two determinations made by the Deputy District Manager relating to slides that occurred on the Schroeder Creek Mainline (the “Mainline”) constructed by Kalesnikoff in the Kootenay Lake Forest District.

In the first determination, the Deputy District Manager found that Kalesnikoff had contravened section 45(3)(a) of the Forest Practices Code of British Columbia Act (the “Code”) by constructing a forest road which resulted in slumping or sliding of land in the vicinity of 2+500 of the Mainline. Specifically, the Deputy District Manager found that Kalesnikoff had placed more “spoil” (excess material that has been excavated elsewhere during road construction) on the site than the designed capacity, resulting in oversteepened slopes.  The Deputy District Manager also found that Kalesnikoff had contravened section 12(1)(b) of the Forest Road Regulation (the “Regulation”) by failing to ensure that the road construction was carried out in general conformance with the requirements of the road layout and design.  He imposed a fine of $1,000 for the first contravention and did not impose a penalty for the second contravention.  In a subsequent administrative review decision, this penalty was increased to $2,500 for each contravention.

In the second determination, the Deputy District Manager found that Kalesnikoff had contravened section 45(3)(a) of the Code by constructing a forest road which resulted in the slumping or sliding of land at three locations in the vicinity of 6+333 to 6+480 of the Mainline.  Specifically, the Deputy District Director found that Kalesnikoff had failed to construct the road using the extraordinary construction techniques prescribed for the area to prevent excessive water flow.  He also found that Kalesnikoff had contravened section 13(1)(c) of the Regulation by failing to ensure that the drainage system for the road intercepted surface water and subsurface drainage from the cut slope, and by failing to prevent water from being directed onto potentially unstable slopes.  The Deputy District Manager imposed a penalty of $3,000 for the contravention of the Code and $600 for the contravention of the Regulation.  These penalties were confirmed in a subsequent administrative review decision.

Kalesnikoff appealed the determinations on the grounds that the Deputy District Manager had erred on the facts and in law and that if Kalesnikoff had contravened the legislation, the Deputy District Manager should have found that Kalesnikoff had exercised due diligence.

The Commission first considered the preliminary issue of whether Kalesnikoff was precluded from pursuing its appeal concerning the contravention of section 12(1)(b) of the Regulation because of an agreement made between Kalesnikoff and the Forest Practices Board, prior to the administrative review, that Kalesnikoff would accept the penalty for that contravention.  The Commission found that the agreement was made without prejudice to either party’s right to further appeal the matter.  The Commission found that judicial decisions regarding “admissions” were not directly applicable in this case, as they do not take into account the unique features of the administrative tribunals system.  Therefore, the agreement was not an “admission” for the purposes of the appeal.  The Commission further found that since Kalesnikoff did not admit to the contravention for the purposes of the appeal, estoppel by representation did not apply.

The Commission then considered the proper interpretation of section 45(3) of the Code.  The Commission found that this section was designed to prevent a person from carrying out a forest practice, including road construction, which may result in significant environmental damage due to weather conditions or site factors.  Licensees must remain alert to the conditions encountered in the field and cannot simply rely on plans or designs.  Therefore, the Commission found that if a significant damaging event occurs, its actual cause is of less interest under this section than whether this type of damaging event was, or could have been, foreseen in light of site and weather conditions.

In regards to the first determination, the Commission found that there was no evidence that would support a finding the Kalesnikoff knew or ought to have known, either prior to road construction or in the field, that the placement and/or volume of spoil at 2+500 might result in a significant slide. Therefore, the Commission found that Kalesnikoff did not contravene section 45(3)(a) of the Code.

The Commission further found that Kalesnikoff did not contravene section 12(1)(b) of the Regulation.  The Commission found that the volume and placement of spoil was not identified in the approved designs and their identification is not a general requirement or general practice in the industry.  Therefore, the Commission found that Kalesnikoff constructed the 2+500 section of the Mainline in accordance with the road design.

In regards to the second determination, the Commission found that there was nothing in the information available to Kalesnikoff that would support a finding that Kalesnikoff knew or ought to have known that the road construction, specifically the drainage system approved for the location, might result in a significant slide.  Accordingly, the Commission found that Kalesnikoff did not contravene section 45(3).

The Commission further found that Kalesnikoff did not contravene section 13(1)(c) of the Regulation.  The Commission found that the drainage system was designed to direct the surface and subsurface water flow from culverts into existing natural gullies.  This design was consistent with the design criteria set out in section 9(1)(b) of the Regulation and was approved by the District Manager.  The Commission also found that it is common practice not to include every design detail in a drainage system design, and that the drainage system, as designed, may require modification during construction in response to site conditions.  Therefore, the Commission found that section 13(1) of the Regulation functions as a “checklist” for road builders at the time of construction.  Thus, a contravention of section 13(1) may arise when a drainage system is constructed either in a manner that is not consistent with the design or with subsequent design changes, or when it is constructed in such a way that it puts the road prism or the environment at a higher risk of damage than allowed for in the design.  The Commission found that the culverts, as constructed, directed the water into natural gullies as designed and that the excess water was not the result of improper construction.

Given the Commission’s findings that there were no contraventions, it did not have to make a finding as to the defence of due diligence.  However, the Commission did comment on the parties’ submissions as to due diligence.  The Commission found that it is not feasible to require a licensee to acquire a second expert opinion in order to have demonstrated due diligence.  However, the Commission also found that an expert is a “contractor” for the purposes of section 117(2) of the Code and that a licensee is therefore responsible for an expert’s actions.  Furthermore, the Commission found, a licensee cannot assert due diligence merely by hiring a competent expert.

The Deputy District Manager’s determinations were rescinded and the appeal was allowed.