First Capital Realty v. Imperial Oil Ltd.: The Polluter Pays Principle Is Expanded

The recent decision of the British Columbia Supreme Court, First Capital Realty v. Imperial Oil Limited, emphasizes the "polluter pays" principles of the BC Environmental Management Act (the "Act") and establishes that a purchaser with full knowledge of contamination may not be responsible for any clean up costs.

The case involved a contaminated property in Nanaimo (the "Property"). The Plaintiff purchased the property from a third party who was not involved in the litigation.

Imperial Oil owned the Property until 1993 and operated a gas station thereon until 1991. The third party never used the Property, as a gas station or otherwise. The Plaintiff owned the neighbouring lands and was acquiring the Property for the purposes of development. One of the conditions of the sale was that the Plaintiff investigate the environmental condition of the Property. The Plaintiff did so and it was revealed the Property was contaminated. The Plaintiff proceeded with the purchase