The Rural Voice, 2000-04, Page 64A.
Agrilaw
Pipeline puncture — who is liable?
By Paul G. Vogel
Landowners with energy pipelines
crossing their property must be
concerned about their potential
liability for damages caused by them
or their agents resulting from a
pipeline puncture. Both under their
easement agreements with pipeline
companies and by virtue of federal
and provincial legislation, when
carrying out work in the vicinity of
pipelines on their property.
landowners may be subject to notice
obligations or require the consent of
the pipeline company before
undertaking excavation in the vicinity
of the pipelines. These obligations,
limitations on property rights, and
resulting potential liability are
becoming of increasing concern to
pipeline landowner organizations.
Where a pipeline is ruptured during
the course of excavation by a
landowner or his agent, is the
landowner, the agent or the company
responsible for the resulting
environmental damage and cleanup
costs?
An Ontario court was required to
consider this issue in a case where the
contractor, employed by the
landowner to clear trees and brush
from his property, punctured a
pipeline with the bucket teeth of his
front-end loader while pushing
stumps and brush across the pipeline
easement resulting in the release of
100,000 litres of gasoline. The
pipeline company sued the landowner
and the contractor for the significant
cleanup costs and the value of the
gasoline alleging that they had been
negligent in failing to first obtain "a
locate" of the line before undertaking
the work in question. While the
impacted pipeline had been
constructed more than 30 years
earlier with a design requirement of
24 inches of cover, at the time of this
incident, pipeline cover at the point
of rupture was only two or three
inches.
On the evidence adduced at trial,
the Court determined that the
company was aware of the
insufficient cover as a result of a
probe investigation conducted at the
property three years earlier in
60 THE RURAL VOICE
connection with other work carried
out by the landowner. At that time,
the company had, in fact, lowered
100 feet of the pipeline to a depth
sufficient to establish the required
cover and had advised the
landowner's wife that the remaining
line, including the
point of puncture,
would be lowered.
This work was
never completed.
With respect to
the alleged
negligence of the
landowner or the
contractor in
failing to obtain
"a locate", the
Court determined
that. had the
pipeline been at
the required
depth, the work
undertaken was no of a type that
could reasonably have been expected
to interfere with the pipeline. In any
event. the court held that the cause of
the pipeline puncture was not the
failure of the landowner or contractor
to locate the pipeline because the
location of the pipeline was already
well -marked on the property and was
known to both defendants.
The court concluded that the sole
effective cause of the damage to the
pipeline was the negligence of the
pipeline company because, while the
pipeline company knew that the
pipeline lacked sufficient cover at
various locations along its route, the
company failed to warn the public but
chose to deal with problems as they
arose. With respect to the particular
property involved in this case, the
company had specific knowledge of
the insufficiency of cover.
In dismissing the company's claim
against the landowner and contractor
in this case, the Court stated:
"The work undertaken by the
contractor ... on the ... property,
while it did entail the use of
mechanical equipment, was
qualitatively and quantitatively a
surface project. It was not digging,
boring, trenching, grading,
excavating or breaking ground
Landowners
must be careful
working around
pipelines
on their
property
with mechanical equipment. The
fact that there was incidental
intrusion into the ground does not
alter this characterization of the
work. Therefore, there was no
requirement on the part of (the
owner) or (the contractor) to
contact (the pipeline company) in
accordance with ... the Energy
Act. Accordingly, the allegation of
negligence against (the contractor)
and (the owner) must fail.
(The company) owed a duty to
take reasonable care in locating its
pipeline at a safe depth. (The
company) was negligent in that it
failed to bury the ... pipeline at the
rupture site at a depth of 24 inches
or more when the pipeline was
first laid. It failed to do so ...
when it was laying the second
pipeline ... It knew or ought to
have known that the pipe was not
buried to a depth of 24 inches but
was much closer to the surface. It
again failed ... to lower the
pipeline to a safe depth when it
knew or ought to have known that
that its pipeline was not at a safe
depth based on specific
information concerning the depth
of its pipeline on the
(landowner's) property. It failed to
inspect its pipeline on the
(landowner's) property at this time
or to warn (the landowner) of the
situation. It failed to relocate its
pipeline at a proper depth of 24
inches or deeper when it knew or
ought to have known that failure
to do so could result in damage to
the pipeline or to others."
In the event of the pipeline
rupture, it is clear from this case that
the issue of the potential liability for
damages of the landowner or his
contractor will very much depend on
the particular facts of the case and the
respective responsibility of the parties
for the circumstances giving rise to
the damages. Landowners concerned
about their potential liability should
ensure that they are aware of the
requirements of their easement
agreements and relevant regulatory
restrictions.0
Agrilaw is a syndicated column