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19th January 2017
Landowner Loses Fight to Sue Regulator in Fracking Case

In split decision, justices say Jessica Ernst has no right to sue over alleged Charter violations.

By Andrew Nikiforuk 13 Jan 2017
Andrew Nikiforuk is an award-winning journalist who has been writing about the energy industry for two decades and is a contributing editor to The Tyee. His award-winning book Slick Water, documents the Ernst case and the history of fracking.

The Supreme Court of Canada has ruled Jessica Ernst can’t sue the powerful and controversial Alberta Energy Regulator (AER) over alleged violations of her Charter rights.

The split ruling Friday - five justices rejected her claim, with four supporting it - is a setback for the protection of groundwater and the rights of landowners dealing with provincial energy regulators, often funded or captured by industry interests, say many critics and lawyers.

The majority, led by Justice Thomas Cromwell, upheld an immunity clause passed by the legislature that protects the Alberta Energy Regulator from any Charter claims or lawsuits.

In 2007, Ernst, an oil patch environmental consultant, sued the Alberta government, Encana and the regulator for negligence over the contamination of local aquifers near her Rosebud home allegedly caused by the hydraulic fracturing of shallow gas wells in 2004.

After Alberta courts ruled that Ernst could sue the government but not the regulator because of an immunity clause (Encana never contested the lawsuit), Ernst took that part of her case to the Supreme Court of Canada.

Her lawyers, along with the BC Civil Liberties Association and David Asper Centre for Constitutional Rights, argued in January 2016 that no regulatory body had the right to block citizens from seeking remedies for violations of their fundamental Charter rights and that no citizen should be unfairly silenced by Canada’s energy boards.

Alberta’s Energy Regulator accused Ernst of “criminal threats” in a 2005 letter and refused to communicate when she persistently asked embarrassing questions about the effectiveness of its enforcement actions on noise pollution and water contamination related to the fracking of shallow coal seams near her home.

According to Ernst’s original statement of claim, an AER lawyer admitted during a taped interview with her in 2007 that the board never considered Ernst a criminal threat but felt “humiliated” by her public criticisms of its abusive conduct. That exchange was witnessed by Liberal MLA David Swann.

The five justices in the Supreme Court majority concluded that immunity clauses are in the interests of “good governance.”

“Opening the Board to damages claims could deplete the Board’s resources, distract it from its statutory duties, potentially have a chilling effect on its decision making, compromise its impartiality, and open up new and undesirable modes of collateral attack on its decisions,” they wrote.

But four dissenting judges, including Chief Justice Beverly McLachlin, took the opposite view.

“We see no compelling policy rationale to immunize state actors in all cases, including where, as here, the impugned conduct is said to have been ‘punitive’ in nature,” they wrote. “To be precise, what Ms. Ernst alleges is that the Board, far from exercising an adjudicative function, effectively sought to punish her by barring access to those functions so long as she continued to criticize the Board in public.”

The Supreme Court decision is the latest chapter in a costly 10-year legal fight that has focused attention on regulation of the disruptive and chaotic technology of hydraulic fracturing.

“All Canadians have lost in this decision,” Ernst told The Tyee. “Whenever any Canadian is harmed by pipelines or fracking and they present evidence of harm to a regulator and then that regulator ignores or denies that evidence, citizens can no longer sue for justice.”

“I believe that split decision will generate a lot of debates among lawyers and judges across the country,” added Ernst. “I think some good will come from this terrible decision on a level we can’t yet imagine. I will keep going until I run out of money or die or whatever comes first.”

Cory Wanless, one of Ernst’s lawyers, said the split decision makes it difficult to fathom what the Supreme Court really means. Four judges supported the immunity clause; one raised separate constitutional issues in rejecting Ernst’s case; and four argued in favour of her right to sue the AER. “The whole issue will have to be resolved another day,” Wanless said.

In a public statement on Friday, the Alberta Energy Regulator hailed the Supreme Court decision as an important one for regulators across the country. It added that, “The Court did not find there was a breach of Ms. Ernst’s Charter rights, and made no findings of negligence on the part of the AER or its predecessor the Energy Resources Conservation Board.”