Case Analysis: Trail Smelter Case (United States, Canada) (1938, 1941)

Author: Aakash Chakole.

CITATION

Trail smelter case (United States, Canada), 3 UNRIAA, p. 1905, 1952.

NAMES OF PARTIES

Plaintiff: United States of America.

Defendant: Canada.

ARBITRATORS

Charles Warren (U.S.A.);

Robert A. E. Greenshields (Canada); and

Jan Frans Hostie (Belgium).

INTRODUCTION

It’s Sunday morning, you are sitting at your balcony having a cup of coffee, breathing the fresh air and at that very moment someone in the neighbourhood burned plastic and waste material. Won’t it be discomforting and harmful to breathe in all the smoke emitted by the burning of waste? This is exactly what happened in the Trail Smelter Case just the dispute was transboundary dispute between United States and Canada. Trail Smelter case in International Environmental Law has made a great impact in substantive development of envirometnal laws. The sic utere principle that was established in this case is now not limited to international environmental but has also been applied to cases of terrorism and internet torts.

This article is a case analysis of Trail Smelter Case (United States and Canada). The author has discussed the facts and issues of thecase and the ruling made by the Tribunal. Then the author has analyzed the case by signifying its importance in contemporary world.

FACTS

The dispute aroused due to the release of sulphur dioxide into the air as a by-product of the smelting process carried on by the Consolidated Mining and Smelting Company of Canada Ltd. The company incorporated in 1809 was a private corporation located at the bank of Columbia River at Trail, British Columbia, at about 11 miles from the international boundary between United States and Canada. Roasting of sulphur bearing ores released the sulphur dioxide gas in the air, the air current carried the polluted air containing sulphur dioxide in sufficient amount to cause damage across the border into the State of Washington. In the 1925 and 1926, the company increased its smelting activities which led to the increase in the emission of sulphur dioxide fumes.

A formal complaint was made by the farmer whose land was located just south of the boundary line. The company investigated and concluded that the damage was being done and thus negotiated with the complainants and settled the dispute. Several complaints were made by the land owners and company settled them for different amounts. Consequently in the year 1927the government of the US intervened in the dispute between the owners of the land and the Company and proposed to the Canadian government that the dispute should be referred to the International Joint Commission pursuant to Article IX((Article IX of the Boundary Waters Treaty 1909 provides the high contracting parties might agree that any other question or matters of difference arising between them involving the rights, obligations or interests of either in relation to the other or to the inhabitants of the other, along the common frontier between the US and Dominion of Canada shall be referred from time to time to the International Joint Commission for examination and report. Such reports shall not be regarded as decisions of the questions submitted and shall not in any way, have the character of an arbitral award.)) of the Boundary Waters Treaty 1909. The Joint Commission after investigating the dispute came to the conclusion that about $350,000 of the damage was caused to the citizens of US till 1931. The commission also recommended a method for indemnifying persons in the state of Washington in case of future damage and also suggested the manner according to which Canadian company should operate to minimize the nuisance.

However, even after two years the damage continued and so unsatisfied with the existing situations, the US government was obliged to make representations of the problem to the Canadian Government. After negotiating, both the states agreed to submit the dispute before the arbitral tribunal constituted under the convention of 1935. This tribunal consisted of the 3 members, one was chosen by the US, one by the Canada and the third member was chosen jointly.

ISSUES

The Article III of Convention of 1935 enlisted 4 questions that were to be submitted before the tribunal. Those are:

1. Whether damage caused by the Trail Smelter in the State of Washington has occurred since the first day of January, 1932, and, if so, what indemnity should be paid therefore?
2. In the event of the answer to the first part of the preceding Question being in the affirmative, whether the Trail Smelter should be required to refrain from causing damage in the State of Washington in the future, and, if so, to what extent?
3. In the light of the answer to the preceding Question, what measures or regime, if any, should be adopted or maintained by the Trail Smelter?
4. What indemnity or compensation, if any, should be paid on account of any decision or decisions rendered by the Tribunal pursuant to the next two preceding Questions?

JUDGMENT

Whether damage caused by the Trail Smelter in the State of Washington has occurred since the first day of January, 1932, and, if so, what indemnity should be paid therefore?

The tribunal held that the damage has been caused by the Trail Smelter in the state of Washington since the first day of January 1932 up to October 1 1937. And thus the indemnity of seventy eight thousand dollars is to be paid and an interest rate of 6% per centum per year is allowed on the sum until the date of payment. Tribunal specifically mentioned that this is the complete and final indemnity and compensation for all the damages done to the cleared and uncleared land between the abovementioned dates.

In the event of the answer to the first part of the preceding Question being in the affirmative, whether the Trail Smelter should be required to refrain from causing damage in the State of Washington in the future, and, if so, to what extent?

After examining the relevant provisions of the convention and various precedents, tribunal held that as per the laws of United states and the principles of the international law, no state has right to use or permit the use of its territory in such a way so as to cause damage by fumes in or to the territory of another or the properties or the people therein, when the case has serious consequences and the damage established by clear evidence. Thus, relying on these observations the tribunal held the Canada responsible for the conduct of the Smelter Company and said that it is the duty of the Dominion of Canada to check that whether the activities of the company are in accordance with the convention and international law.  The tribunal refrain the Trial Smelter from causing any future damage through fumes in the Washington to the extent until which the damages are recoverable through the courts of United States in suits between the private individuals. The indemnity for the damage should be fixed by the Governments on mutual terms under Article XI of the Convention.((III Reports of International Arbitral Awards, pp. 1965 and 1966.))

In the light of the answer to the preceding Question, what measures or regime, if any, should be adopted or maintained by the Trail Smelter?

The tribunal imposed a regime control over the emissions of the sulphur dioxide gas from the smelter. After investigating and observing keenly the concentrations of the sulphur dioxide in the air the tribunal set out a regime on the basis of the growing and non-growing areas.. when carrying over the non-growing areas the minor modifications were made in the regime of demonstrated efficiency for the growing season, the fumigations are to be kept under control at a level well below the threshold of possible injury to vegetation. Likewise, in growing season the company will not yield fumes with concentrations below the international boundary sufficient to cause injury to plant life. The tribunal realized that the regime will not be enough to abate the nuisance and thus it prescribed a machinery for Amendment or Suspension of the Regime which included a clause providing a compulsory arbitration by a commission of Scientists.((Id. at pp. 1973-1974.))

What indemnity or compensation, if any, should be paid on account of any decision or decisions rendered by the Tribunal pursuant to the next two preceding Questions?

The Tribunal was of the opinion that the prescribed regime will probably remove the cause of the dispute and will also prevent the trail smelter from making any future damage. Nevertheless the tribunal decided that the US will be paid an indemnity of $7,500 in any one year as compensation in any event of future damage. Such compensation shall be made for the costs of investigation only when the occurrence of the damage is established as per Article XI of the convention.

ANALYSIS

Trail Smelter case was the foundation in the development of international environmental law. Over the time its application was not limited to environmental aspects but also has been extended to other international concerns. The analysis of the Trail smelter is done under three heads: the sustainable development, the law of the Sea.

The Sustainable Development and the Trail Smelter Case

In the case of Danube Dam case((Gabcikovo-Nagymaros Project, 1997 I.C.J. 7 (Sept. 25), reprinted in 37 International Legal Materials 162 (1998) [hereinafter “Danube Dam case”].)), the Hungarian Republic and the Czechoslovak Republic entered into a treaty agreeing to build a series of dams along the Danube River between the two territories. Objects of the treaty were the flood control and producing hydroelectricity. Article 15, 19 and 20 of the treaty were centered for the environmental concerns by ensuring that the quality of water and fishing interests of people are not compromised with. But when the project got commenced concerns and criticism aroused in Hungary regarding the impact the project is having on the environment. Consequently, Hungary suspended the works on the project in order to conduct studies on the possible environmental impacts and accordingly terminated its obligations under the treaty. It justified its termination by stating the serious environmental concerns related to the level of groundwater in the area decreasing the supply of drinking water by two-thirds. Matter went to the ICJ, wherein ICJ concluded that both the states are under legal obligation to negotiate the best possible ways to fulfill all the objectives of the treaty. The parties are required to consider the implications of the projects on the environment without compromising the development goals central to the project.((Rebecca M. Bratspies and Russell A. Miller, TRANSBOUNDRY HARM IN INTERNATIONAL LAW: LESSONS FROM THE TRAIL SMELTER ARBITRAIOTN, 2006, p. 140.)) The opinion of the Court defined sustainable development very simply by obligating the parties to reconcile the economic development with the protection of the environment.

The concept of sustainable development is very well employed under Principle 2 and 8 of the Stockholm Declaration which says that the economic and social development is essential but such must be done by ensuring that the natural resources of the earth are safeguarded for present and future generations.((Report of the Stockholm Conference, U.N.Doc. A/CONF. 48/14, reprinted in 11 International Legal Materials 1416 (1972).)) The decision of the tribunal in Trail Smelter Case reflects the concept of sustainable development, where the tribunal attempted to reconcile the interests of Canada in economic development and US interest in the protection of its environment. The regime that was imposed by the tribunal allowed the smelter to function because the company being one of the largest in the continent, ceasing its operation would have impacted the economy of the Canada. So, with the smelter in function, the company was obliged to control the fumigations so as to not affect the environment conditions of the surrounding area including the area outside its territory. This desire of the tribunal to provide a just solution to both the parties by considering the economic and social development of the Canada and safeguarding the environment of the US, reflects the concept of sustainable development.

The Law of the Sea and the Trail Smelter Case

The Tribunal in Trail Smelter case observed a key principle that no state has the right to use or permit the use of its territory in such a manner as to cause injury by fumes in or to the territory of another or the properties or persons therein. What it reiterates is the sit utere principle which says that no state should undertake such activity or allow the use of its territory in such a way that it may harm the territory of the neighboring state or any other state.

Now in case of law of the sea, a coastal state has sovereign rights within its Exclusive Economic Zone (EEZ) only over the resources within the EEZ and not the full sovereignty. Under Article 56(1)(b)(iii) of Law of the Sea Convention gives the state jurisdiction over the marine environment protection, living and non living resources to a distance of 200 nautical miles from the coast. Aim of this particular article was that the value and the utility of the sovereign rights over the marine resources would diminish if pollution of the EEZ by other states takes place without any restrictions.((Rebecca M. Bratspies and Russell A. Miller, TRANSBOUNDRY HARM IN INTERNATIONAL LAW: LESSONS FROM THE TRAIL SMELTER ARBITRAIOTN, 2006, p. 209.)) Referring to the Article 194(2) of the Convention which states:

“States shall take all measures necessary to ensure that activities under their jurisdiction or control are so conducted as not to cause damage by pollution to other States and their environment, and that pollution arising from incidents or activities under their jurisdiction or control does not spread beyond the areas where they exercise sovereign rights in accordance with this Convention.”

This particular article gives the state the right of action for the damage caused by the another state to the resources inside its jurisdiction. It is the closely analogous to the principle of sit utere as observed under Trail Smelter Case. Same is with article 195 which imposes a duty on the states to not to transfer the damage or harm caused by the pollution from one area to another. This is exactly was the case in Trail Smelter where the sulphur dioxide fumes from the Smelter company in Canada drifted towards the territory of United States causing damage therein.

Now if look to the observation made in the Trail Smelter Case and the articles of Law of the Sea Convention as mentioned are almost analogous in nature. Irrespective of the area of pollution they refer, both the cases refers to the sit utere principle.

CONCLUSION

Trail Smelter Arbitration case was a landmark decision in the regime of International Environmental Law. It introduced the sit utere principle which later was recognised as customary international law. Though the case was related to the nuisance caused because of the air pollution, the decision of the tribunal to not to carry such activities which may harm the territory of the other state formed the basis of the various other principles like the sustainable development and the law of the sea. With time scope of the Trail Smelter widened and now we can see that the sit utere principle is not only limited the Environmental laws but also transboundary harm like terrorism and cyber crimes.

Earth has limited natural resources available for the world community and its uncontrolled consumption is now affecting the world flora and fauna. Trail Smelter case obliged every state to take care of the activities in their territory so that it may not cause damage to the neighbouring state. Now the states have some responsibilities to the other states and if states can look after each other in this time when not only economic development matters but also conservation of natural resources of the Planet earth is of great concern, the world community might be able to develop sustainably.