COURT OF APPEAL FOR ONTARIO  
CITATION: Intact Insurance Company v. Zurich Insurance Company Ltd.,  
2022 ONCA 485  
DATE: 20220624  
DOCKET: C69639  
Simmons, Harvison Young and Zarnett JJ.A.  
BETWEEN  
Intact Compagnie d’assurance/Intact Insurance Company  
Plaintiff (Appellant)  
and  
Zurich Insurance Company Ltd., Group G3 Inc./Le Groupe G3 Inc., Tembec Inc.  
and ARC Resins Corporation  
Defendants (Respondents)  
AND BETWEEN  
Zurich Insurance Company Ltd., Group G3 Inc./Le Groupe G3 Inc., Tembec Inc.  
and ARC Resins Corporation  
Plaintiffs by Counterclaim  
and  
9144-9769 QC Inc. operating as Transport Donia Banville and the Estate of  
Jocelyn Lehaie, deceased  
Defendants by Counterclaim  
Tamara Farber and Madeleine Dusseault, for the appellant  
Page: 2  
Frank Csathy and Chris Afonso, for the respondents  
Heard: February 25, 2022 by video conference  
On appeal from the order of Justice Andra Pollak of the Superior Court of Justice,  
dated May 31, 2021, with reasons at 2021 ONSC 3624.  
Zarnett J.A.:  
[1]  
The central issue in this appeal is whether an insurer may recover, by direct  
action1 against persons other than its own insured, amounts it paid in excess of its  
policy limits for the remediation of an environmental spill in which the insured was  
involved.  
[2]  
The appellant, Intact Compagnie d’Assurance/Intact Insurance Company  
(“Intact”), was the insurer of a transportation company. A truck owned by Intact’s  
insured, and operated by one of its employees, overturned while carrying a  
shipment of liquid formaldehyde. The formaldehyde was released onto residential  
lands and into a municipal water supply.  
[3]  
Liquid formaldehyde is a pollutant within the meaning of the Environmental  
Protection Act, R.S.O. 1990, c. E.19 (“EPA”). Under s. 93 of the EPA, the person  
who had control of the pollutant and the owner of the pollutant at the time of the  
environmental spill are each responsible to eliminate or ameliorate the adverse  
effects of the spill and restore the environment (the “duty to remediate”).  
1 As opposed to a subrogated claim in the name of the insured.  
Page: 3  
[4]  
Intact’s insured, as a person who had control of the formaldehyde at the time  
of the spill, was subject to a s. 93 duty to remediate. In fulfillment of its policy  
obligations to its insured, Intact arranged and made payments toward remediation  
efforts. But Intact claims it went further than its policy obligations. Although Intact’s  
policy limit was $5 million, it claims that its payments for remediation were in  
excess of $7.9 million. In other words, Intact’s payments exceeded the financial  
limits of its policy by about $2.9 million (the “excess payments”).  
[5]  
Intact does not seek to recover the excess payments from its own insured.  
Instead, Intact claims a right to recover the $2.9 million in excess payments from  
the respondents. The respondents are the company whose liquid formaldehyde  
was being shipped, the company to whom it was being shipped, and the company  
that had arranged the shipment – each of whom was also under a s. 93 EPA duty  
to remediate – as well as their insurer. Intact claims the respondents were aware  
that Intact’s policy limits were being exhausted, yet they took no steps toward  
remediation until after the excess payments were made.  
[6]  
Section 99(2)(a) of the EPA creates a right to recover compensation from  
the owner or person having control of a pollutant for, among other things, loss or  
damage directly resulting from the spill of a pollutant that causes or is likely to  
cause an adverse effect, or the failure of a person to fulfill their s. 93 duty to  
Page: 4  
remediate.2 In an action under s. 99(2), the plaintiff is not required to prove fault or  
negligence on the part of the defendants, but the plaintiff’s claim will be reduced to  
take into account its own fault or neglect. According to the respondents, the  
environmental spill occurred solely due to the fault or neglect of Intact’s insured.  
[7]  
Taking the position that the excess payments were not made on behalf of  
its insured, Intact asserts that it has its own right of action to recover those  
payments from the respondents under s. 99(2)(a) of the EPA, making any issue  
about its insured’s fault or neglect in causing the spill irrelevant to its claim. Intact  
also claims under the doctrine of unjust enrichment, asserting that the excess  
payments relieved the respondents of an obligation for payments they would have  
had to make.  
[8]  
action. Intact appeals that decision.  
[9] For the reasons below, which differ somewhat from those of the motion  
On a motion for summary judgment, the motion judge dismissed Intact’s  
judge, I conclude that Intact’s action was properly dismissed. I would therefore  
dismiss its appeal. Intact does not, in these circumstances, have a right of action  
to recover its excess payments from the respondents under s. 99(2)(a) of the EPA.  
Nor does the doctrine of unjust enrichment permit such recovery.  
2 The full text of s. 99(2) is reproduced in the Appendix.  
Page: 5  
A. Background  
[10] Intact insured 9144-9769 QC Inc. operating as Transport Donia Banville  
(“TDB”) against liability for damage to the property of others. Under the policy  
issued by Intact to TDB, Intact’s obligations were subject to a limit of $5 million.  
[11] In May 2012, TDB was transporting a shipment of liquid formaldehyde. The  
shipment was arranged by the respondent Group G3 Inc./Le Groupe G3 Inc. (“G3”)  
and was to go from the supplier of the formaldehyde, the respondent ARC Resins  
Corporation (“ARC”), to the respondent Tembec Inc. (“Tembec”). G3, Tembec, and  
ARC were insured against liability for property damage to others by the respondent  
Zurich Insurance Company Ltd. (“Zurich”).  
[12] While transporting the formaldehyde, TDB’s vehicle overturned near a  
residential neighborhood in North Bay, Ontario.  
[13] The result was a spill of about 30,000 litres of formaldehyde, as well as fuel  
and coolant, onto residential properties and into the municipal drinking water  
supply for North Bay.  
[14] It is not in dispute that TDB was a person who had control of the  
formaldehyde at the time of the spill. Nor is it in dispute that formaldehyde is a  
pollutant within the meaning of the EPA.  
[15] Shortly after the spill occurred, Intact, as TDB’s insurer, arranged and began  
to make payments toward remediation efforts.  
Page: 6  
[16] In July 2012, Intact advised Zurich, the insurer for ARC and Tembec as  
owners of the pollutant, and for G3 as a person who had control of the pollutant,  
that the cost of the remediation efforts would likely exceed Intact’s $5 million policy  
limit.  
[17] Intact’s counsel formally advised Zurich in September 2012 that the  
$5 million limit would be reached within the coming days, and that upon that  
occurring, Zurich would have to take over funding the continuing remediation.  
[18] In October 2012, Zurich advised that it was not prepared to fund the  
remediation as its insureds were not in receipt of a Minister’s order under the EPA  
requiring them to remediate.  
[19] Intact continued to pay amounts toward the ongoing remediation until at  
least May 2014. Its original position (subsequently abandoned) was that it had  
been induced to do so by misrepresentations concerning Zurich’s intentions to take  
over payments, and that it would not have done so if those misrepresentations had  
not been made. In its evidence, Intact referred to a number of other reasons for its  
choice to continue making payments, including concern about a potential bad faith  
claim and media scrutiny, as well as concern for the residents affected by the spill.  
However, it did not assert that any of these reasons legally required it to make the  
excess payments.  
Page: 7  
[20] The Ministry of the Environment issued an Order on May 23, 2014 that,  
among other things, declared Tembec, ARC, G3, and TDB to be in breach of their  
remediation obligations under s. 93 of the EPA, declared that the contamination  
was still present, and required Tembec, ARC, G3, and TDB to continue with the  
existing remedial plan or develop a new remedial plan for approval.  
[21] Thereafter, Zurich, on behalf of its insureds G3, Tembec, and ARC, started  
to pay for the ongoing remediation.  
[22] Intact claims that its total payments toward remediation, until Zurich began  
to make payments, were $7.96 million – in other words, $2.96 million in excess of  
its policy limits.  
[23] Intact brought an action against the respondents for the excess payments,  
that is, the amount it claimed it paid in excess of its policy limits.3 Intact asserted a  
cause of action under s. 99(2)(a) of the EPA, which gives any person the right to  
compensation for loss or damage incurred as a direct result of (among other  
things) the spill of a pollutant that causes or is likely to cause an adverse effect, or  
neglect or default in carrying out a duty imposed under Part X of the EPA, which  
includes the s. 93 duty to remediate. Intact alleged that the spill and the failure of  
G3, Tembec, and ARC to fulfill their s. 93 duty by not contributing to the cost of  
remediation upon Intact’s policy limits having been exhausted were the cause of  
3 TDB was originally named as a plaintiff, but it was later removed.  
Page: 8  
its excess payments. Intact also based its claim on the tort of negligent  
misrepresentation and on the doctrine of unjust enrichment. In the latter respect, it  
alleged that its excess payments were a deprivation that enriched G3, Tembec,  
and ARC, as well as its insurer Zurich, for which there was no juristic reason.  
[24] The respondents defended. They denied any misrepresentations. They  
alleged that TDB and the Estate of the operator of TDB’s vehicle (the “Estate”), for  
whom TDB was responsible, were the sole parties at fault for the spill, and  
therefore were responsible for the entire cost of the remediation. They asserted  
that Intact had no right of recovery against them under the EPA. They claimed that  
any amounts Intact paid, even if in excess of its policy limits, were paid for “the  
benefit of Intact’s own insureds”. They denied any liability for unjust enrichment.  
The respondents also made a claim against TDB and the Estate to recover any  
amounts paid by the respondents or on their behalves toward the remediation.4  
B. The Summary Judgment  
(1)The Directions  
[25] Intact moved for summary judgment on its claim. In permitting such a motion  
to proceed, Sossin J. (as he then was) noted that Intact had withdrawn any claim  
that it had been induced to make payments beyond its policy limits by Zurich’s  
misrepresentations. Even though the summary judgment motion would leave  
4 These claims were originally advanced as a counterclaim but are proceeding as a third party claim since  
TDB is no longer a plaintiff in the action.  
Page: 9  
outstanding the aspect of the litigation regarding the respective degrees of fault for  
the spill as raised by the respondents’ claim against TDB and the Estate, he felt  
that this issue could be appropriately bifurcated from the determination of Intact’s  
claim:  
I also accept Intact’s position that the EPA liability issue  
does not depend on an adjudication of fault in relation to  
the North Bay formaldehyde spill, pursuant to  
section 99(3) and (4) of the EPA. Of course, the issues  
relating to the application of the EPA in relation to this  
action [remain] for the motions judge to determine.  
For these reasons, I am persuaded that Intact’s proposed  
summary judgment motion meets the threshold set out  
under [the] case law as one of the rare cases where the  
issues to be decided on the proposed summary judgment  
motion may be bifurcated from other, remaining issues in  
the litigation.  
(2)The Motion Judge’s Decision  
[26] The motion judge dismissed Intact’s motion and its action. She concluded  
that a determination of the issues by summary judgment was appropriate, and she  
noted Intact’s position that the summary judgment motion should result in a final  
disposition of its claim one way or the other, as Intact acknowledged that if, on the  
motion, it were determined that Intact had no meritorious claim in unjust  
enrichment or statute, it would be within the court’s jurisdiction to dismiss Intact’s  
claim.  
Page: 10  
[27] The motion judge observed that s. 99(3) of the EPA creates a defence for  
persons who establish that they took all reasonable care to prevent the spill. She  
held that G3, Tembec, and ARC had made out that defence on the evidence  
because the spill occurred due to the way TDB’s driver operated its vehicle. She  
further held that the elements of unjust enrichment had not been established, as  
the party who benefitted from the excess payments was TDB rather than the  
respondents. She also found that the excess payments were made without any  
reasonable expectation that Intact would recover them from the respondents,  
providing a further reason to reject the unjust enrichment claim. Additionally, she  
found that Intact had not proven its damages since its evidence about the quantum  
of the excess payments was inadmissible hearsay.  
C. Analysis  
[28] Intact argues that the motion judge erred in law about liability under the EPA  
and about the application of the doctrine of unjust enrichment. It submits that under  
s. 99(2)(a) of the EPA, it qualifies as a person who suffered a loss – the excess  
payments – as a direct result of the spill and the failure of G3, Tembec, and ARC  
to fulfill their s. 93 remediation duties by immediately beginning to pay for the  
remediation when Intact’s policy limits were reached. Intact submits that the motion  
judge was wrong to exonerate these respondents from liability on the basis that  
they had shown the spill occurred despite their having taken reasonable care, as  
that is not a defence where the claim is for loss or damage that is the direct result  
Page: 11  
of a failure to fulfill s. 93 duties or for cost and expense to eliminate or ameliorate  
the adverse effect of a spill, and any fault or neglect of TDB is irrelevant as Intact  
itself is the plaintiff. It submits that the motion judge was wrong to view its damages  
evidence as inadmissible hearsay. It also argues that she erred in her unjust  
enrichment finding.  
[29] At the heart of Intact’s position is the proposition that Intact should be viewed  
separately from its insured because the excess payments were not made to fulfill  
a policy obligation to its insured, and no other legal obligation required it to make  
the excess payments. It is this proposition that underpins Intact’s submission that  
its claim fits under s. 99(2)(a) of the EPA in a way that is not subject to any fault-  
based reduction that might be available to the respondents if the claim was by, or  
in the name of, its insured. It also underpins the argument that the respondents  
benefitted from the excess payments even if, as between them and TDB, TDB  
might be held responsible to completely indemnify them for any remediation  
expenses.  
[30] I agree with the respondents that Intact’s excess payments do not qualify for  
compensation under s. 99(2)(a) of the EPA. Nor is there a basis, in these  
circumstances, for an unjust enrichment claim. I begin, therefore, with a discussion  
of those issues, accepting for the purpose of argument that Intact made the excess  
payments for remediation expenses. In light of my conclusion on those issues, and  
Page: 12  
because they are dispositive of the appeal, I do not reach the hearsay issue  
regarding the quantum of the excess payments.  
(1)The s. 99(2)(a) Claim  
(a)Overview  
[31] Part X of the EPA recognizes certain categories of persons who will incur  
remediation expenses and provides remedies for them to recover compensation  
for those expenses. Although Intact’s insured, TDB, comes within one of those  
categories, Intact, when viewed separately from its insured, does not. Intact’s  
attempt to describe its claim as one for loss or damage within the meaning of  
s. 99(2)(a) fails because a person who chooses to make remediation payments,  
but does not have any obligation to remediate or does not incur remediation  
expenses because of a threatened or actual adverse effect to their person or  
property, does not suffer loss or damage as a direct result of the spill and its  
adverse effects, or as a direct result of the failure of another person to fulfill their  
duty to remediate, as required by s. 99(2)(a).  
[32] This result is consistent with the legislation viewed as a whole in light of its  
purpose. Although Intact’s payments exceeded its policy limits, the excess  
payments were not completely unconnected to Intact’s position as TDB’s insurer.  
The EPA limits and controls the rights as between persons with s. 93 duties to  
remediate – one way in which it does so is to require a s. 99(2) claim by such a  
Page: 13  
person to be reduced by the extent of that person’s fault. Recognizing Intact’s claim  
as one that could be brought under s. 99(2)(a), and thus allowing Intact to avoid  
any deduction for any fault of its insured, would be inconsistent with these  
important aspects of the statutory scheme.  
(b)Interpreting s. 99(2)(a)  
[33] Whether Intact’s claim comes within s. 99(2)(a) involves a question of  
statutory interpretation, requiring a “textual, contextual and purposive analysis to  
find a meaning that is harmonious with the Act as a whole”: Canada Trustco  
Mortgage Co. v. Canada, 2005 SCC 54, [2005] 2 S.C.R. 601, at para. 10.  
(i) Purpose  
[34] The EPA is Ontario’s principal environmental protection statute. Its purpose  
is to protect and conserve the natural environment; that purpose extends to  
protecting those who use the natural environment by protecting human health,  
plant and animal life, and property: EPA, s. 3; Castonguay Blasting Ltd. v. Ontario  
(Environment), 2013 SCC 52, [2013] 3 S.C.R. 323, at para. 10.  
[35] The EPA is accordingly entitled to “a generous interpretation” following “an  
expansive approach”. Its intended reach is “wide and deep”. The remedial powers  
in the EPA are to be interpreted with these principles in mind: Castonguay, at  
paras. 9-11.  
Page: 14  
[36] Viewed through this lens, s. 99(2) of the EPA was described in Midwest  
Properties Ltd. v. Thordarson, 2015 ONCA 819, 128 O.R. (3d) 81, leave to appeal  
refused, [2016] S.C.C.A. No. 22 as a “private right of action … designed to  
overcome the inherent limitations in the common law in order to provide an  
effective process for restitution to parties whose property has been contaminated”:  
at para. 6.  
(ii) Text and Context  
[37] Section 99(2), and related provisions that inform its meaning, are found in  
Part X of the EPA. Part X addresses who will remediate an environmental spill and  
provides for compensation for the consequences of spills that cause, or are likely  
to cause, adverse effects and the costs associated with remediating them.  
[38] Section 93 imposes a duty to remediate an environmental spill on the owner  
of the pollutant and the person who had control of it at the time of the spill. The  
s. 93 duty comes into effect immediately upon knowledge of the spill of the  
pollutant and its adverse or likely adverse effect. As s. 93 states:  
(1) The owner of a pollutant and the person having control of a  
pollutant that is spilled and that causes or is likely to cause an adverse  
effect shall forthwith do everything practicable to prevent, eliminate  
and ameliorate the adverse effect and to restore the natural  
environment.  
(2) The duty imposed by subsection (1) comes into force in respect of  
each of the owner of the pollutant and the person having control of the  
pollutant immediately when the owner or person, as the case may be,  
Page: 15  
knows or ought to know that the pollutant is spilled and is causing or  
is likely to cause an adverse effect.  
[39] “Adverse effect” is defined in s. 1(1) of the EPA and includes, among other  
things, impairment of the quality of the natural environment, property damage,  
harm or material discomfort to any person, loss of enjoyment of normal use of  
property, and interference with the normal conduct of business.  
[40] In addition to the duty to remediate imposed by s. 93 on the owner and  
person in control of the pollutant, Part X provides that others may be made the  
subject of a duty to remediate by a Minister’s order or direction. Section 94 provides  
that the Minister of what is now known as the Ministry of Environment,  
Conservation and Parks may direct employees and agents of the Ministry to take  
steps to remediate the effects of a spill when the Minister believes it is in the best  
interest of the public to do so and those with the s. 93 duty to remediate do not  
perform, cannot be located, or request assistance. Section 97 of the EPA provides  
that the Minister may also make orders directing remediation of a spill against the  
owner or person having control of the pollutant, and against others, such as the  
municipality where the spill occurred or a contiguous municipality.  
[41] The EPA also contemplates two other categories of persons who may incur  
expenses involved in remediation. First, the legislature contemplated that persons  
who are directly affected by the spill, such as a property owner whose lands are or  
may become contaminated, may incur remediation expenses. That contemplation  
Page: 16  
is evident in s. 99(2), discussed below. Second, s. 100 provides that a municipality  
and other persons designated by regulation may (even in the absence of a  
Minister’s order) take remediation steps in the event of a spill.  
[42] Part X provides for certain rights of compensation. As they relate to the type  
of claim in issue here – one that seeks compensation for expenses incurred in  
relation to remediation – these rights are provided to persons the EPA envisages  
will incur remediation expenses.  
[43] Section 99(2) confers a right to compensation on the federal or provincial  
Crown or “any other person” from the owner or person in control of the pollutant at  
the time of the spill in defined circumstances. Section 99(2)(a) provides for  
compensation for loss or damage as a direct result of certain specified matters,  
including a spill that causes or is likely to cause an adverse effect, or a failure of a  
person to carry out a duty to remediate. Section 99(2)(b) contemplates  
compensation for reasonable costs and expenses related to carrying out a  
Minister’s order or direction.  
[44] Section 99(2) provides, in relevant part:  
(2) Her Majesty in right of Ontario or in right of Canada or any other  
person has the right to compensation,  
(a) for loss or damage incurred as a direct result of,  
(i) the spill of a pollutant that causes or is likely to cause  
an adverse effect,  
…
Page: 17  
(iii) neglect or default in carrying out a duty imposed or  
an order or direction made under this Part;  
(b) for all reasonable cost and expense incurred in respect of  
carrying out or attempting to carry out an order or direction  
under this Part,  
from the owner of the pollutant and the person having control of the  
pollutant.  
[45] Section 99(1) defines “loss or damage” as including “personal injury, loss of  
life, loss of use or enjoyment of property and pecuniary loss, including loss of  
income”.  
[46] The s. 99(2) remedy does not require the plaintiff to prove fault or negligence  
on the part of the defendant to the claim. Section 99 does provide a defence to  
compensation claims for persons who establish that they took reasonable care,  
but only in respect of certain types of claims. Importantly though, it states that any  
fault or negligence of the s. 99(2) plaintiff is to be taken into account in reduction  
of their claim5:  
(3) An owner of a pollutant or a person having control of a pollutant is  
not liable under subsection (2) if they establish that they took all  
reasonable steps to prevent the spill of the pollutant….  
(4) Subsection (3) does not relieve the owner of the pollutant or the  
person having control of the pollutant,  
(a) from liability for loss or damage that is a direct result of  
neglect or default of the owner of the pollutant or the person  
having control of the pollutant in carrying out a duty imposed or  
an order or direction made under this Part; or  
5 The full text of s. 99 is reproduced in the Appendix.  
Page: 18  
(b) from liability, under clause (2) (a), for cost and expense  
incurred or, under clause (2) (b), for all reasonable cost and  
expense incurred,  
(i) to do everything practicable to prevent, eliminate and  
ameliorate the adverse effect, or  
(ii) to do everything practicable to restore the natural  
environment,  
or both.  
…
(6) Liability under subsection (2) does not depend upon fault or  
negligence.  
(7) In an action under this section,  
(a) where the plaintiff is an owner of the pollutant or a person  
having control of the pollutant, the court shall determine the  
degree, if any, in which the plaintiff would be liable to make  
contribution or indemnification under subsection (8) if the  
plaintiff were a defendant; and  
(b) where the plaintiff is not an owner or a person having control  
referred to in clause (a), the court shall determine the degree, if  
any, in which the plaintiff caused or contributed to the loss,  
damage, cost or expense by fault or negligence,  
and the court shall reduce the compensation by the degree, if any, so  
determined.  
[47] Section 99(8) prescribes how liability is to be shared among the owners and  
persons having control of the pollutant. Although liable to the plaintiff on a joint and  
several basis, these persons are liable to make contribution or indemnification to  
each other in accordance with their respective degrees of fault or negligence.  
Page: 19  
[48] In addition to the rights to compensation under s. 99(2), a municipality or  
person designated by regulation who chooses to undertake remediation under  
s. 100 and incurs expenses is given a right to seek compensation for them, from  
the owner or person in control of the pollutant, under s. 100(4).  
(iii) Judicial Interpretation of s. 99(2)  
[49] This court’s leading decision on s. 99(2) is Midwest. That case addressed a  
claim under the section by a property owner whose lands were contaminated by a  
pollutant that escaped from a neighbour’s property. As noted above, this court  
described s. 99(2) of the EPA as a “private right of action … designed to overcome  
the inherent limitations in the common law in order to provide an effective process  
for restitution to parties whose property has been contaminated” (emphasis  
added): Midwest, at para. 6.  
[50] Midwest is an illustration of how a s. 99(2)(a) claim could include a claim for  
expenses of remediation. The court held that a claim under s. 99(2)(a) by a  
property owner is not restricted to recovery of diminution in property value caused  
by an environmental spill; it may include recovery of the costs of remediating the  
property. The court stated, at para. 70:  
In summary, restricting damages to the diminution in the  
value of property is contrary to the wording of the EPA,  
the trend in the common law to award restorative  
damages, the polluter pays principle and the whole  
purpose of the enactment of Part X of the EPA. It would  
Page: 20  
indeed be a remarkable result if legislation enacted to  
provide a new statutory cause of action to innocent  
parties who have suffered contamination of their property  
did not permit the party to recover the costs of  
remediating their property, given the EPA’s broad and  
important goals of protecting and restoring the natural  
environment.  
(c) Intact’s Claim for Excess Payments Does Not Fit Under ss. 99(2)(a)(i) or  
99(2)(a)(iii)  
[51] The only parties who can be liable under s. 99(2) are the owner of the  
pollutant and the person who had control of it at the time of the spill. Zurich does  
not come within that definition. Accordingly, there can be no s. 99(2) claim against  
Zurich. As among the respondents, only G3, Tembec, and ARC are persons who  
come within the liability language of s. 99(2).  
[52] I agree with Intact that s. 93 of the EPA imposed a duty to remediate on all  
of G3, Tembec, and ARC (as well as TDB) from the time of the spill. The Minister’s  
order of May 2014 only confirmed that duty; it did not create it. On the evidence,  
G3, Tembec, and ARC did nothing to fulfill that duty until after the Minister’s order.  
Accordingly, G3, Tembec, and ARC are persons who can be liable under s. 99(2),  
including for failure or neglect to carry out their s. 93 duty. Contrary to the motion  
judge’s finding, if Intact’s claim otherwise fell within s. 99(2)(a), a defence that  
these respondents “took all reasonable steps to prevent the spill of the pollutant”  
under s. 99(3) would not be available to them. The provisions of s. 99(4) would  
apply to preclude that defence because the claim is in part premised on their failure  
Page: 21  
to fulfill the duty to remediate under s. 93 and also because the claim is for  
expenses to remediate.  
[53] However, several considerations combine to warrant rejecting Intact’s  
assertion that it can claim the excess payments under s. 99(2)(a).  
[54] First, Intact is not the typical s. 99(2)(a) claimant. It is not a party whose  
property was contaminated by the spill – the type of party for whom this court, in  
Midwest, described the cause of action in s. 99(2) as having been created.  
[55] Second, Intact, as a person who chose to fund remediation expenses  
beyond its obligation to its insured, does not come within any of the other  
categories of person who the legislature envisaged would incur such expenses. It  
was not itself under a s. 93 duty to remediate. Although TDB was under such a  
duty, Intact insists that its excess payments were not made due to a policy  
obligation to TDB. Intact was not under a Minister’s order when it made the excess  
payments, nor did it make those payments to carry out a Minister’s order. It was  
not a municipality, nor did it claim to be a person designated by regulation to whom  
the legislature gave a discretion to undertake remediation.  
[56] The statutory scheme contemplates that these different categories of  
persons will, if they incur remediation expenses, have a route by which recovery  
of such expenses may be sought from the polluter – the person who owned the  
pollutant or was in control of it.  
Page: 22  
[57] Someone whose person or property is directly affected, or is likely to be  
affected, by a spill and is, or will be, put to remediation expenses is given a right  
to compensation under s. 99(2)(a) because their expenses are a measure of their  
loss or damage, as illustrated by the decision in Midwest. Persons with a s. 93 duty  
to remediate may also incur remediation expenses. To the extent that they pay  
more than their proportionate share of such expenses, they may seek recovery  
from others who had a s. 93 duty, as contemplated by ss. 99(7) and (8). The Crown  
may incur expenses if it makes an order under s. 94 directing its employees or  
agents to remediate; similarly, other persons who are directed by a Minister’s order  
to remediate under s. 97 may also incur such expenses. A right of recovery for  
expenses is provided to the Crown and those persons in s. 99(2)(b). A municipality  
or person designated by regulation who undertakes remediation and incurs  
expenses under s. 100 is given a right to seek compensation for them under  
s. 100(4).  
[58] But the EPA does not contemplate remediation being undertaken by  
someone who does not fit into any of the categories the EPA envisages – someone  
whose person or property is not affected or threatened to be affected by the spill,  
and who is without any statutory obligation or permission to remediate. More  
importantly for these purposes, the EPA does not include such persons in any of  
the express rights to compensation for remediation expenses that it sets out. The  
legislature must be taken to have contemplated that persons with a duty to  
Page: 23  
remediate may be insured, and that an insurer might pay for remediation. But the  
legislature did not include insurers in any of the express categories of persons who  
can directly claim compensation for expenses paid, presumably intending that any  
claim would be a subrogated one by and in the name of the insured. For this  
reason, Intact’s assertion that it has a direct right does not sit easily with the  
statutory scheme.  
[59] Third, if Intact had its own right to sue under s. 99(2)(a), rather than a  
subrogated right to assert a claim by TDB, it would be able to assert its claim  
without accounting for any fault TDB had in causing the spill. Under s. 99(7), a  
s. 99 claimant who had a role in the spill will have their claim reduced according to  
their degree of fault. If TDB had made the payments itself and sued the  
respondents under s. 99(2)(a), it would have to reduce its claim for its degree of  
fault or negligence in causing the loss in the first place. The same would be true if  
Intact took the position that its excess payments had been made on behalf of TDB,  
and the action were brought as a subrogated claim by Intact in TDB’s name. This  
is significant, as on the motion judge’s factual findings, TDB appears to have had  
substantial responsibility for the spill.  
[60] Yet, even if Intact did not make the excess payments because of a legal  
obligation to its insured, the payments were related to the fact that Intact had  
insured TDB. Intact’s witness admitted on examination that one reason it continued  
to make payments beyond its policy limits was concern about being subjected to  
Page: 24  
a bad faith claim if it stopped paying. Moreover, Intact had become involved in the  
remediation efforts because of its role as TDB’s insurer. It seems doubtful that the  
legislature intended the result Intact’s claim would achieve.  
[61] Fourth, the requirement under s. 99(2)(a) that there be loss or damage  
resulting directly from a spill or failure to fulfill a duty is not satisfied by the mere  
fact that a payment toward remediation of the effects of a spill was made after a  
spill, or after a party with a s. 93 duty failed to fulfill it. Section 99(2)(a) requires a  
direct causal relationship between on the one hand, the spill or failure to remediate,  
and on the other hand, the claimed loss or damage. The direct causal relationship  
will be present where an actual or threatened adverse effect to the claimant is the  
result of the spill or neglect of duty. In such circumstances, payments of expenses  
incurred to prevent, mitigate, or rectify the harm are recoverable because they are  
a quantification or measure of the harm – the loss or damage – that was suffered.  
But in the absence of actual or threatened harm to a person’s legally protected  
interests directly arising from an event specified in s. 99(2)(a), a payment that flows  
from a different legal obligation, or a voluntary choice, stands in a distinctly different  
category.  
[62] The distinction may be illustrated by a number of examples.  
[63] The environmental spill addressed in Midwest led directly to loss or damage  
to the plaintiff, an innocent property owner, and thus fell within s. 99(2)(a). The  
Page: 25  
occurrence of the spill and its migration toward, and onto, the plaintiff’s property in  
and of itself caused harm to the plaintiff’s property interests. The plaintiff’s choices  
were limited to how it would suffer the harm – incurring cost to remediate or  
suffering a diminution in the value of its unremediated contaminated property. The  
harm, the loss or damage, itself flowed directly from the spill, and the failure of the  
polluter to remediate, whether manifested as depreciated property or remediation  
expenses.  
[64] Similarly, a person under a s. 93 duty to remediate may suffer a loss directly  
due to the failure of another person to fulfill its s. 93 duties. Section 99(8) creates  
a right to proportionate sharing of the s. 93 remediation obligations among those  
that are subject to them. The failure of one person to respect their duties may  
directly lead to another paying a disproportionate share.  
[65] On the other hand, a payment related to contaminated property or the cost  
to remediate that is made because the payor has undertaken a different legal  
obligation does not flow directly from the spill or the failure to fulfill the duty to  
remediate it, and thus falls outside of s. 99(2)(a).  
[66] The claim made in MVL Leasing Ltd. v. CCI Group Inc., 2018 ONSC 1800,  
18 C.E.L.R. (4th) 155 is an example of this type of situation, which is beyond the  
scope of s. 99(2). In MVL, environmental consultants (“CCI”), when sued for  
negligence by their client for failing to detect contamination on a property the client  
Page: 26  
was acquiring, sought to claim over under s. 99 against the prior owners or  
occupants of the property as persons responsible for the pollution. CCI argued that  
any damages it would have to pay to its client for failing to advise them they were  
buying contaminated lands would not have occurred but for the lands being  
contaminated in the first place, such that the “direct result” hurdle was crossed.  
Diamond J. rejected this argument and adopted the view that for loss or damage  
to be a direct result, there must be “an unbroken chain of events” without an  
intervening act. CCI’s alleged negligence and breach of contract, rather than the  
contamination of the property, was the cause of its claimed loss: MVL, at paras. 28-  
30.  
[67] Put differently, the occurrence of pollution on the property in and of itself  
caused no harm – no loss or damage – to CCI or any of its legally protected  
interests. The fact that the property was adversely affected by contamination did  
not start a chain of events that would lead to personal injury, property damage, or  
pecuniary loss to CCI save for the intercession of a different legal obligation. CCI  
undertook obligations to its client to detect whether the property was contaminated.  
It was that legal obligation, and its breach, that would be the cause of any payment  
it had to make.  
[68] The distinction between direct and indirect results is also clarified through  
examining why Intact is not able to claim, from the respondents, the amount of  
$5 million that it paid in accordance with its policy. Although, in one sense, Intact’s  
Page: 27  
payments toward remediation up to $5 million would not have occurred if the  
respondents had looked after remediation pursuant to their s. 93 duties, in the  
“direct result” sense, the first $5 million of payments were not part of an unbroken  
chain of events starting with the spill or the respondents’ failure to remediate. The  
cause of the payments was Intact’s insurance policy with TDB, which itself had a  
s. 93 duty to remediate.  
[69] When Intact’s payments reached the policy limits, it ceased to be under any  
obligation to its insured under the policy with respect to remediation costs. It had  
no other legal duty to remediate. The spill and its effects, and the failure of the  
respondents to begin to fund remediation, at that point had no direct bearing on  
Intact’s legal interests. Intact could have chosen to make no further payments. It  
did not make the excess payments to protect its property from contamination.  
Unlike a property owner faced with contamination, who would suffer a loss  
regardless of whether she expended funds on remediation, or a person who herself  
has a duty to remediate, Intact could have chosen not to incur this particular loss.  
Intact’s choice – not the spill or the respondents’ neglect of their duty – was the  
direct cause of it expending nearly $3 million more than its policy limits. While the  
respondents’ neglect may have been an indirect cause of Intact’s continued  
remediation payments, such losses are beyond the reach of s. 99(2)(a).  
Page: 28  
[70] For these reasons, I conclude that the motion judge reached the right result  
in finding that Intact could not maintain a claim under s. 99(2)(a) of the EPA for its  
excess payments.  
(2)The Unjust Enrichment Claim  
[71] As the Supreme Court stated in Moore v. Sweet, 2018 SCC 52, [2018]  
3 S.C.R. 303, at para. 37, to succeed in a claim for unjust enrichment, a plaintiff  
must show that:  
(a) the defendant was enriched;  
(b) the plaintiff suffered a corresponding deprivation; and  
(c) the defendant’s enrichment and the plaintiff’s corresponding deprivation  
occurred in the absence of a juristic reason.  
[72] The motion judge correctly referred to these requirements. Her application  
of this test to the facts is a matter of mixed fact and law, subject to a standard of  
review of palpable and overriding error absent any extricable error of law: Open  
Sez-A-Me-Inc. v. Drewlo Holdings Inc., 2018 ONSC 7670 (Div. Ct.), at para. 21;  
Rogers Communications Partnership v. Society of Composers, Authors and Music  
Publishers of Canada, 2016 FCA 28, 393 D.L.R. (4th) 354, at para. 124, leave to  
appeal refused, [2016] S.C.C.A. No. 119.  
Page: 29  
[73] In the motion judge’s view, the enriched party – the true beneficiary of any  
excess payments – was Intact’s own insured, TDB. Had Zurich or its insureds  
made these payments, this would have only increased the value of their  
counterclaims against TDB. She held this to be a juristic reason for any  
enrichment. As well, following Garland v. Consumers’ Gas Co., 2004 SCC 25,  
2004 1 S.C.R. 629, at para. 46, she considered the reasonable expectations of the  
parties to be a residual, or second stage, reason to deny the claim. She found that  
the parties’ reasonable expectations were that Zurich would not pay unless the  
Minister made an order against its insureds, and that Intact made the excess  
payments in the face of that.  
[74] Intact argues that the benefit analysis is flawed because the motion judge  
should have found that if Intact did not make the excess payments, the  
respondents would have had no choice but to do so. In other words, Intact argues  
that its excess payments constituted a “negative” benefit; the respondents were  
spared an expense they would otherwise have been required to undertake: Peel  
(Regional Municipality) v. Canada; Peel (Regional Municipality) v. Ontario, [1992]  
3 S.C.R. 762, at p. 790. Although had the respondents made those payments, this  
might have increased their ultimate claim against TDB, Intact says that the initial  
benefit was enjoyed by the respondents, regardless of their ability to recover them  
from Intact’s insured.  
Page: 30  
[75] Intact also argues that the motion judge’s juristic reason analysis is flawed  
because the EPA did not require a transfer of wealth by it for the benefit of the  
respondents, and because the motion judge should have found that Intact did not  
share Zurich’s expectation and that Zurich’s expectation was unreasonable.  
[76] I would not interfere with the motion judge’s conclusion that an unjust  
enrichment remedy is not available to Intact in these circumstances.  
[77] First, counsel for Intact framed the unjust enrichment argument as being  
“based on an understanding of the framework under the EPA” and as a common  
law claim “based on the circumstances of the statute”. As counsel for Intact fairly  
pointed out in argument, the claim is aimed at fixing liability on Zurich, who cannot  
be reached under a s. 99(2)(a) claim even though, on Intact’s theory, the other  
respondents – Zurich’s insureds – have liability to Intact under that section. But on  
the view I have taken of the s. 99(2)(a) claim, none of the respondents has any  
liability to Intact under this provision. Giving effect to the unjust enrichment claim  
would make it a remedy for Intact against all the respondents in circumstances  
where the legislative scheme has not created any.  
[78] Second, I am not persuaded by Intact’s argument that the only salient  
question in the benefit analysis is whether, if Intact had not made the excess  
payments, the respondents would have, without regard to whether the benefit of  
the payments would flow to TDB in the end. The doctrine of unjust enrichment  
Page: 31  
requires an unrequested service to be an “incontrovertible benefit”: Peel, at  
pp. 795-96; Grover v. Hodgins, 2011 ONCA 72, 103 O.R. (3d) 721, at para. 57,  
leave to appeal refused, [2011] S.C.C.A. No. 142. In some cases, a benefit that is  
merely temporary will not constitute an enrichment: Birkett v. Astris Energi Inc.  
(2004), 45 B.L.R. (3d) 293 (Ont. C.A.), at para. 90. In my view, this is an important  
consideration in the context here – whether an incontrovertible negative benefit  
should be considered as having been conferred on the respondents by a payment  
that the respondents say would have been recoverable from Intact’s insured under  
the legislative scheme if the respondents themselves had made it. This feature  
was not present in Accuworx Inc. v. Enroute Imports Inc., 2016 ONCA 161,  
97 C.E.L.R. (3d) 198, relied on by Intact.6  
[79] As described above, ss. 99(7) and (8) provide for sharing, contribution, and  
indemnity among persons who have a duty under s. 93 of the EPA in proportion to  
their relative degrees of fault. As the respondents concede, the total of Intact’s  
policy payments and excess payments will be a credit, for TDB, against any  
amounts the respondents say should have been paid by it to meet its proportionate  
responsibility. Although Intact argues that the result of the contest over  
proportionate shares has not been determined, it seems to me that on any  
6 In Accuworx, a director of a property owner and its lessee authorized remediation work by a contractor to  
“minimize or eliminate the risk that the MOE would make a remedial order”: at para. 8. The contractor was  
not paid by the lessee, who became insolvent. The contractor was found to have conferred a negative  
benefit on the property owner.  
Page: 32  
determination, TDB has benefited. If more was paid than TDB’s proportionate  
share as determined under those sections, TDB will be able to defeat the  
respondents’ claims and may be entitled to recover the excess. If, taking into  
account the excess payments, exactly the amount of TDB’s proportionate share  
was paid, TDB will be entitled to defeat the respondents’ claims. If less has been  
paid than the amount that represents TDB’s proportionate share, Intact’s insured  
has still benefited from Intact’s payments, reducing the respondents’ claim against  
it.  
[80] The fact that liability under s. 99(8) remains to be determined in the litigation  
does not assist Intact. Intact chose to bring its summary judgment motion in  
advance of that determination. In order to succeed in showing that it was the  
respondents who received an “incontrovertible benefit”, Intact would have to show  
that the resolution of the s. 99(8) process is not likely to result in the ultimate benefit  
of the payments being enjoyed by TDB, rather than the respondents. Intact did not  
establish that.  
[81] Although the motion judge analyzed the benefit and juristic reason parts of  
the analysis together, her finding that it was TDB who benefited from Intact’s  
payments was sufficient to dispose of the unjust enrichment claim. Where a benefit  
to the defendant has not been established, an unjust enrichment claim fails without  
the need for a juristic reason analysis: Birkett, at para. 91.  
Page: 33  
[82] Finally, I am not satisfied that the motion judge made a reversible error in  
her determination of the reasonable expectations of the parties as a “second stage”  
basis to deny the claim. On the record, she was entitled to find that Zurich indicated  
it would not be paying unless the Minister made an order. As Intact dropped its  
misrepresentation claim, it was open to the motion judge to find that Intact was  
aware of Zurich’s intentions and made its excess payments with that knowledge,  
such that they would reasonably be taken to have shared the same expectations.  
[83] The doctrine of unjust enrichment applies “when a defendant receives a  
benefit from a plaintiff in circumstances where it would be ‘against all conscience’  
for him or her to retain that benefit”: Moore, at para. 35. Given the respondents’  
lack of liability to Intact under the EPA, the benefit to Intact’s insured arising from  
Intact’s excess payments, the voluntary nature of Intact’s payments, and the  
reasonable expectations of Intact and Zurich, the doctrine does not assist Intact  
here.  
(3)The Hearsay Issue  
[84] In light of my conclusions on the first two issues, it is not necessary to  
address the motion judge’s determination that Intact’s damages evidence was  
inadmissible hearsay.  
Page: 34  
D. Conclusion  
[85] I would dismiss the appeal. The respondents are entitled to their costs of the  
appeal fixed in the amount of $13,700, inclusive of disbursements and applicable  
taxes.  
Released: June 24, 2022  
Page: 35  
APPENDIX: SECTION 99 OF THE EPA  
Compensation, spills  
99 (1) In this section,  
“loss or damage” includes personal injury, loss of life, loss of use or enjoyment of  
property and pecuniary loss, including loss of income.  
Right to compensation  
(2) Her Majesty in right of Ontario or in right of Canada or any other person has  
the right to compensation,  
(a) for loss or damage incurred as a direct result of,  
(i) the spill of a pollutant that causes or is likely to cause an adverse  
effect,  
(ii) the exercise of any authority under subsection 100 (1) or the  
carrying out of or attempting to carry out a duty imposed or an order  
or direction made under this Part, or  
(iii) neglect or default in carrying out a duty imposed or an order or  
direction made under this Part;  
(b) for all reasonable cost and expense incurred in respect of carrying out or  
attempting to carry out an order or direction under this Part,  
from the owner of the pollutant and the person having control of the pollutant.  
Exception  
(3) An owner of a pollutant or a person having control of a pollutant is not liable  
under subsection (2) if they establish that they took all reasonable steps to prevent  
the spill of the pollutant or if they establish that the spill of the pollutant was wholly  
caused by,  
(a) an act of war, civil war, insurrection, an act of terrorism or an act of  
hostility by the government of a foreign country;  
(b) a natural phenomenon of an exceptional, inevitable and irresistible  
character; or  
(c) an act or omission with intent to cause harm by a person other than a  
person for whose wrongful act or omission the owner of the pollutant or the  
person having control of the pollutant is by law responsible,  
or any combination thereof.  
Page: 36  
Qualification  
(4) Subsection (3) does not relieve the owner of the pollutant or the person having  
control of the pollutant,  
(a) from liability for loss or damage that is a direct result of neglect or default  
of the owner of the pollutant or the person having control of the pollutant in  
carrying out a duty imposed or an order or direction made under this Part;  
or  
(b) from liability, under clause (2) (a), for cost and expense incurred or, under  
clause (2) (b), for all reasonable cost and expense incurred,  
(i) to do everything practicable to prevent, eliminate and ameliorate  
the adverse effect, or  
(ii) to do everything practicable to restore the natural environment,  
or both.  
Enforcement of right  
(5) The right to compensation under subsection (2) may be enforced by action in  
a court of competent jurisdiction.  
Liability  
(6) Liability under subsection (2) does not depend upon fault or negligence.  
Contribution  
(7) In an action under this section,  
(a) where the plaintiff is an owner of the pollutant or a person having control  
of the pollutant, the court shall determine the degree, if any, in which the  
plaintiff would be liable to make contribution or indemnification under  
subsection (8) if the plaintiff were a defendant; and  
(b) where the plaintiff is not an owner or a person having control referred to  
in clause (a), the court shall determine the degree, if any, in which the  
plaintiff caused or contributed to the loss, damage, cost or expense by fault  
or negligence,  
and the court shall reduce the compensation by the degree, if any, so determined.  
Extent of liability  
(8) Where two or more persons are liable to pay compensation under this section,  
they are jointly and severally liable to the person suffering the loss, damage, cost  
or expense but as between themselves, in the absence of an express or implied  
contract, each is liable to make contribution to and indemnify the other in  
accordance with the following principles:  
Page: 37  
1. Where two or more persons are liable to pay compensation under this  
section and one or more of them caused or contributed to the loss, damage,  
cost or expense by fault or negligence, such one or more of them shall make  
contribution to and indemnify,  
i. where one person is found at fault or negligent, any other person  
liable to pay compensation under this section, and  
ii. where two or more persons are found at fault or negligent, each  
other and any other person liable to pay compensation under this  
section in the degree in which each of such two or more persons  
caused or contributed to the loss, damage, cost or expense by fault  
or negligence.  
2. For the purpose of subparagraph ii of paragraph 1, if it is not practicable  
to determine the respective degrees in which the fault or negligence of two  
or more persons liable to pay compensation under this section caused or  
contributed to the loss, damage, cost or expense, such two or more persons  
shall be deemed to be equally at fault or negligent.  
3. Where no person liable to pay compensation under this section caused  
or contributed to the loss, damage, cost or expense by fault or negligence,  
each of the persons liable to pay compensation is liable to make contribution  
to and indemnify each other in such degree as is determined to be just and  
equitable in the circumstances.  
Enforcement of contribution  
(9) The right to contribution or indemnification under subsection (8) may be  
enforced by action in a court of competent jurisdiction.  
Adding parties  
(10) Wherever it appears that a person not already a party to an action under this  
section may be liable in respect of the loss, damage, cost or expense for which  
compensation is claimed, the person may be added as a party defendant to the  
action upon such terms as are considered just or may be made a third party to the  
action in the manner prescribed by the rules of practice for adding third parties.  
Settlement and recovery between persons liable  
(11) A person liable to pay compensation under this section may recover  
contribution or indemnity from any other person liable to pay compensation under  
this section in respect of the loss, damage, cost or expense for which the  
compensation is claimed by settling with the person suffering the loss, damage,  
cost or expense and continuing the action or commencing an action against such  
other person.  
Page: 38  
Amount of settlement  
(12) A person who has settled a claim and continued or commenced an action as  
mentioned in subsection (11) must satisfy the court that the amount of the  
settlement was reasonable, and, if the court finds the amount was excessive, the  
court may fix the amount at which the claim should have been settled.  
(13), (14) Repealed: 2002, c. 24, Sched. B, s. 25.  


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