Québec Port Authority and IMTT-Québec successful in dispute surrounding the application of Quebec’s Environment Quality Act on port and IMTT operations

Date Closed

April 16, 2020

Lead Office

Montréal

On September 8, 2016 the Québec Superior Court rendered its judgment, Québec (Procureur général) c. IMTT-Québec inc., 2016 QCCS 849, in a constitutional case about whether certain provisions of the Environment Quality Act (“EQA”) applied in the territory of the Port of Québec (“QPA”) and to the tank terminal operations of IMTT-Québec (“IMTT”), one of the QPA's tenants. The court's ruling in favor of the QPA and IMTT established that all dispositions under the EQA and its regulations prescribing the obligation to obtain provincial authorization are constitutionally inoperative with regards to the QPA's activities and installations as they fall under exclusive federal jurisdiction.

In the past, IMTT had obtained certificates of authorization from the Québec environmental authorities for their tank terminal installations on land in the Port of Québec in accordance with the EQA. However, prior to the construction of seven new reservoirs in 2007 and 2008, IMTT only sought and obtained authorization from QPA and federal authorities but did not request authorization from the provincial authorities, citing that it fell under federal jurisdiction. IMTT subsequently received a compliance notification from the provincial authorities in September 2012.

The Attorney General of Québec (“AGQ”) sought an injunction to force IMTT to comply with the evaluation procedures set forth by the EQA and to cease usage of the seven reservoirs (and other equipment installed only with federal authorization in the meantime) until a certificate of authorization was provided by the provincial authorities. QPA and IMTT also initiated declaratory judgment procedures against the AGQ seeking a declaration that the relevant EQA provisions were either inapplicable or inoperative as far as the territory of the QPA and the operations of IMTT are concerned.

The court ultimately concluded that the QPA's and IMTT's activities and operations were all located on federal property and that they also fell under the federal constitutional domain of navigation, governed by the Canada Marine Act, the Canadian Environmental Assessment Act and related regulations.

On September 26, 2019, the Quebec Court of Appeal issued the decision in Attorney General of Quebec v. IMTT-Quebec Inc., 2019 QCCA 1598. The Quebec Court of Appeal held that the IMTT activities at the Port of Quebec are not subject to the environmental assessment and authorization regime contained in the EQA.

On April 16, 2020, the Supreme Court of Canada rejected a request by the AGQ to appeal the prior judgments, making the rulings from the Quebec Court of Appeal and the Quebec Superior Court final.

The QPA controls the operation of the port of Quebec for the purpose of its activities related to navigation, the transportation of passengers and goods, and the handling and storage of goods.

IMTT leases land in the port of Quebec from the Quebec Port Authority for the purposes of storing and handling bulk liquid cargo, principally petroleum and chemical products.

McCarthy Tétrault advised the QPA and IMTT with a team led by Jean Lortie that included Jean-Philippe Mathieu, Patrick Ostiguy, Gabrielle Groulx-Maurer, and Sandra Lemieux (Litigation), and Dominique Amyot-Bilodeau (Environmental).

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