Transport Committee on April 21st, 2009

[Jerry Rysanek]

This fund deals with the liability for pollution damage, or pollution losses. It has nothing to do with the product carried onboard the ship. There must be pollution, there must be linkage to a ship, and there must be a reasonable demonstration of damages and losses. It has nothing to do with what the ship carries at the time of the incident.

[Colin Mayes, Conservative, Okanagan—Shuswap, BC]

Thank you.

Mrs. Gallant.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Witnesses, I want to thank you for your hard work on this bill. It has been many years in the making. I want to thank you especially for the amendments that relate to adventure tourism. Whitewater rafting in Canada was pioneered in my riding of Renfrew—Nipissing—Pembroke, just about an hour and a half up the river from Ottawa.

The problem was that when the maximums of insurance in the previous legislation were implemented, those maximums were the large shipping lines. The prime minister of the day had Canada Steamship Lines, and that would have benefited those types of companies greatly. But for adventure tourism, those maximum limits became their minimums. Some of these rafts have six people, some 12, some 20, depending the size of the raft. When you go rafting, the smaller the raft, the more exciting it becomes and the more active.

They had to have $350,000 per head on each person. But the problem wasn't even a matter of high premiums, necessarily. No insurance company was going to provide them with coverage. The industry faced extinction at that point. Out in rural areas, like Renfrew—Nipissing—Pembroke, many summer jobs are provided through this industry. We started out with one, Wilderness Tours, and now there are many along both sides of the river.

Many people on the Hill and in industry spent their summers working with the rafting companies. It provides an income to university students so they can further their education, and it teaches them good ethics and how to be a good worker. So I thank you for that.

What I'd like you to do for us now is redefine what adventure tourism is.

[Jerry Rysanek]

First of all, thank you for your kind words. I learned very quickly that this was a fairly complex problem. Actually, it was initially easy to solve, but there were a number of people involved in the solution. They are in the room, and I know they appreciate your generosity.

In terms of how we eventually arrived at the solution, we went through many loops. First, we were looking at the type of ship. Should we handle it by way of the ship type? Should we handle it by way of monetary limits? Was there some other option? None of them really worked, so we had to craft a test and put it into the law with the support of most of those we consulted. It basically gives the operator in adventure tourism two responsibilities: a new requirement to tell people what is involved; and to respect any existing safety provisions that apply to that industry, i.e., to make sure that if there is a requirement for life jackets, people will have them, or that if special equipment is required, people will have it.

The bottom line is that the operator has to tell people that theirs is a unique operation, and the people have to acknowledge in writing that they understand it. That, I think, is the basis on which this can work, and can work successfully. With full knowledge, I don't think people will have a problem in making an informed decision whether or not they wish to participate in the activity.

This solution has the widest support of all of the ones we tried, and I hope it will move forward and be adopted.

[Cheryl Gallant, Conservative, Renfrew—Nipissing—Pembroke, ON]

Mr. Chairman, I might like to point out that the only way for committee members to truly understand how this adventure tourism amendment works is to maybe come as a group up the valley and participate in a run down the river. They could maybe take six hours on a Saturday, so we're not taking time away from parliamentary duties or having to negotiate with our whips. I'd like to offer that to you.

Thank you.

[The Chair, Conservative, Merv Tweed]

Well, I'm sure the subcommittee, when they're doing their planning, will take that into consideration, Ms. Gallant.

[Some hon. members]

Oh, oh!

[The Chair, Conservative, Merv Tweed]

And I'm sure that as the weather warms up, we'll all want to go.

Mr. Dhaliwal.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

Thank you very much, Mr. Chair, and thank you, panel.

I would like to echo the comments of Ms. Gallant about the good work and the presentation, with a lot of information.

I'm quite confused about the adventure tourism operators. Will insurance be compulsory for those operators?

[Jerry Rysanek]

No, there is no provision for compulsory insurance for the operators in adventure tourism.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

Why wouldn't we require it?

[Jerry Rysanek]

Did you ask if there is a provision in the new act, or if there was one in the previous act?

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

In the new act.

[Jerry Rysanek]

There is no provision for compulsory insurance in the new act.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

When there's no insurance and a person gets injured, how would that be dealt with?

[Jerry Rysanek]

The insurance is left to the operators to obtain; there is no compulsion to do so. Most of them will—we know that—but there is no provision to compel them to have insurance. They have limited liability in law, but there is no provision to compel them to have the insurance against those limits.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

How would you enforce these things? Would you hire more people to enforce these new regulations? How would it work?

[Jerry Rysanek]

In terms of imposing insurance, I don't think it's a matter of hiring anyone. The choice we were facing was whether or not the industry should be treated as it was prior to 2001, when they had a statutory limit but there was no obligation or requirement to have insurance, or whether they would be where they are now, where we know they cannot obtain the insurance. So as long as it's accepted that they are being placed in the same position as they were prior to 2001, I think it is safe to assume that most of the operators know very well that they have to protect themselves—and they will—through insurance.

[Sukh Dhaliwal, Liberal, Newton—North Delta, BC]

Thank you.

Can I pass this on to my colleague, Andy?

[Andrew Kania, Liberal, Brampton West, ON]

Thank you. I am not on this committee, so forgive me if I am missing something, but I'm just going to look at this.

There is a lien here that people keep talking about as one of the major improvements to benefit Canadians. It's section 139. I would like to look at that for a moment. My question or comment is with respect to enforcement.

When I look at this, I don't see any real teeth to make sure this actually works. For example, if there's a vessel that owes money, it's in a Canadian port and it decides it's going to leave, and it gets outside of Canadian waters and never comes back, so what if there was a lien. What you really need is something like section 126 or 128, which refers back to section 139, so that you can, in essence, stop the vessel from leaving. Maybe you have a quick turnaround within 24 hours to get in front of a judge or something like that, but at least you give the Canadians the opportunity to do something about this before the ship just leaves and perhaps never comes back.

[Jerry Rysanek]

I am delighted to have this question. That's a legal question, and Mr. Gauthier will take it. He's a lawyer too.

[Mark Gauthier]

Thank you very much. The enforcement of this lien, or for that matter any other lien—or for that matter even what we refer to as a statutory action in rem, which is something short of a lien but nonetheless a claim against a vessel—is all set out in the Federal Court Act of Canada. There are quite extensive provisions relating to the arrest of vessels.

In my experience--mind you, I practice in the government and not out there arresting vessels, as a rule. Certainly our colleagues in private industry are quick to tell us that the arrest provisions that we have in the Federal Court of Canada are quite bold and aggressive. Arresting a vessel to obtain security I wouldn't say is a formality, but it is the easiest thing. You prepare an affidavit leading to a warrant. You get a warrant, and you have the marshal of the Federal Court serve the vessel. The vessel is immobilized.

Now of course there can be a vessel that seeks cover of dark to flee from any creditor, including, perhaps, a lien holder under this new lien. That can happen, and there's no question that it does. But because of the nature of the lien that is being created here--a maritime lien, which is similar to the other recognized maritime liens in Canada, for example, salvage, unpaid master's wages, and so on, they follow and they track the ship.

So, for example, if that particular vessel ends up anywhere in the U.S., the ship's agent will hire a lawyer in that particular port to arrest the vessel. The vessel will be caught there. If the vessel does not pay up the security required to address the claim, then of course judicial sale can follow, etc. By virtue of being a maritime lien, it's a preferred claim, and it ranks as just about one of the top things to be paid.

We have to concede that a ship can escape under cover of dark, but we understand in practice that it doesn't happen all that frequently. I think the main idea behind having the maritime lien is that in a judicial sale, the claimant ranks very high and is not an unsecured creditor, which normally would rank at the bottom. That is one of the reasons this is being promoted. There is no notion here of somehow amplifying what is already set out in Canadian law when it comes to the enforcement of maritime claims generally.

[Andrew Kania, Liberal, Brampton West, ON]

I don't know anything about the Federal Court process. I've never appeared in Federal Court. What I do know is that when you're talking about obtaining warrants or orders from judges, it takes time--sometimes a long time. If it's a Friday and there are no judges sitting on Saturday or Sunday, you have a problem. If in fact the ship does not go into the United States, where some judge may or may not decide to take jurisdiction in any event, and it goes to a different country, you have troubles.

In my personal view, rather than having no reference or just purely relying upon what may or may not be in the Federal Court rules—I don't know—it would seem to me to make more sense to refer back to something like section 128, which seems quite good and it makes it instantaneous. That would protect Canadians to make sure that these ships don't leave under cover of night or otherwise. I'm not on this committee, and I'm not the expert, but I would think that would be an improvement to this legislation.

[The Chair, Conservative, Merv Tweed]

Thank you.

Monsieur Gaudet.

[Roger Gaudet, Bloc, Montcalm, QC]

Thank you, Mr. Chair.

I will continue in the same vein as my colleague. I used to work in credit unions and banks. From time to time, some suppliers had liens on buildings. When the bank did not pay up, they were entitled to take possession of the building, even though the bank or credit union was the mortgage holder.

Mr. Gauthier, page 5 states the following: "Maritime lien for ship suppliers: broad support from industry; some concerns from legal community." You know that many foreign vessels use our country's waters. Sometimes, they sail out to sea, switch flags and return under another name. How will you enforce those liens? That is what I find concerning.