Can Ontario directors be named in a Ministry of Environment order requiring cleanup of a contaminated site?

Yes. Ontario's Environmental Protection Act gives the Ministry of the Environment, Conservation and Parks broad powers to issue orders requiring the investigation and remediation of contaminated sites. These orders can be directed not only at the corporation that caused the contamination but also at directors and officers who caused or permitted the discharge of a contaminant, or who directed or authorized activities that led to contamination.

The potential financial exposure from a remediation order can be enormous, particularly for industrial sites or properties with historic contamination. Unlike many other forms of director liability, there is no fixed cap on remediation costs. A director personally named in an environmental order can face open-ended personal financial liability.

The defences available depend on the specific circumstances. Directors who can demonstrate they exercised all reasonable care to prevent the contamination and took prompt action upon becoming aware of it may have grounds to contest an order or limit their personal liability. However, contesting an environmental order is technically and legally complex and requires specialized environmental law expertise. Directors of corporations in industries with significant environmental exposure — manufacturing, resource extraction, fuel handling, and dry cleaning are examples — should ensure robust environmental compliance programs are in place and that they have access to experienced environmental legal counsel before a problem arises.