Evidence of meeting #41 for Natural Resources in the 40th Parliament, 2nd Session. (The original version is on Parliament’s site, as are the minutes.) The winning word was operator.
A recording is available from Parliament.
4:10 p.m.
Conservative
The Chair Conservative Leon Benoit
Thank you, Mr. Cullen.
Who would like to answer that?
Mr. McCauley, go ahead.
4:10 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
Thank you.
I think there are a couple of considerations. When the whole regime was first established in the 1950s or 1960s, the concern was that there was not a lot of knowledge of this new technology, and insurers were very uncertain about being able to provide insurance to the industry. Therefore, the only way they were willing to provide insurance was on a channelled basis, whereby they consolidated all their capacity and provided it to one individual. That was the operator.
There was also a concern that because this was a new technology and it would be very difficult for victims to prove the operator was negligent, etc., it was determined that to ease that compensation it would be an absolute liability regime.
I want to point out also that there's a similar kind of regime in the marine transport of oil.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
I have two quick questions.
Well, the first one's quick. Just in terms of “channelled”, I want to understand the legal definition of “channelled liability”. Maybe you want to answer that first before I get to the second one.
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I'll do my best. Basically, the operator is absolutely liable from a legal perspective.
In the United States, there's such a thing as economic channelling, whereby all the insurance policies point toward the operator but everybody could be considered liable. All the insurance policies point toward the operator.
In Canada and virtually every other nation that has such a regime, the liability is legal channelling--an absolute liability.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
So that's my follow-up question. With respect to that challenge, what is the difference between the U.S. regime and our regime as imagined in this bill? You talk about this economic challenge, and we heard some testimony about this, but it was never clear.
Americans can go beyond the scope, beyond the operator. Is that true?
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
That's right, but all the insurance policies then are directed toward the operator and compensation from the operator, so the operator in effect becomes totally liable.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Essentially it tries to accomplish the same thing, but in a different way, and is that because of tort concerns?
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I think historically that's the way the American system was developed. I believe the German system was also based on economic channelling, but then it moved away and adopted legal channelling.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
This is the second part of the question around recourse. I'm trying to understand. The exclusivity of what we've offered up to nuclear industry is in effect a reaction to the fact that the burden of proof is not the same as it would normally be--you mentioned this just a few minutes ago--to prevent individuals from having to prove the direct damage caused.
There's a concern I would have if I were a nuclear operator and there's an accident and everybody and their dog claims damages and there's class action and it's large, and cities and provinces come on board. What is the level of burden of proof imagined in this bill, or is it under the CNSC as well, where it's at court, or it's under these courts that are set up once an accident happens?
4:15 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
Yes, it's under this bill. Then, as we've already explained, it would follow the normal court process, which means you'd have to prove causation. That would be your big... Did the accident happen and did you sustain damage? That would be what would have to be proved, not who's at fault.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Right, but I'm a little confused.
Mr. McCauley, you said earlier in terms of the origin of this type of liability regime that it was set up in more of an unknown time and to prevent the public from having... I can get the blues later, but you said something to the effect of having to prevent the public from going out and proving direct causality. Or am I misunderstanding what you said?
4:15 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
Causality? I'm sorry.
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
It wasn't causality. It's negligence. They don't have to prove negligence.
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
So then here's my question: is the burden of proof around negligence any different under a nuclear accident imagined in this bill? Because committee members are being asked to vote, in this particular one, on any kind of damage coming up. If we're being asked to set up that liability regime, knowing what the burden of proof is going to be like just in terms of...you're saying that it's not causality, but...?
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
I'm saying they prove causation.
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
But they don't need to prove... It's a lower burden of proof.
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
It's much lower.
4:15 p.m.
Senior Legislative Counsel, Advisory and Development Services Section, Department of Justice
It's much easier to prove. You just have to prove that it actually happened and that you actually suffered damages from--
4:15 p.m.
NDP
Nathan Cullen NDP Skeena—Bulkley Valley, BC
Yes, some effect from it. So is that why they get such an exclusive... I don't want to use any loaded terms here, but the nuclear industry gets special treatment in terms of the insurance regime, because the burden of proof on negligence is lower than it would be for an auto manufacturer? Or am I connecting two dots that aren't to be connected?
I'm trying to understand. I understand that the accidents are real big when they happen and they can get real expensive, so we've set up a different insurance regime than we would for other industries--outside of oil transportation and the massive costs that would happen if an oil tanker were to hit shore.
You said the burden of proof on negligence is different than it would be under a normal lawsuit. Is that not right?
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
There is no requirement to prove negligence, so it's very
4:15 p.m.
Director, Uranium and Radioactive Waste Division, Electricity Resources Branch, Department of Natural Resources
It's very tough on the operator, okay?
4:15 p.m.
NDP