Executive Summary: Key Legal and Evidentiary Issues

• Central issue concerned whether the class action pleadings and Certification Order could be amended to include punitive damages as a certified common issue based on new evidence.
• Evidence from environmental consultants (Aqua Terre, Golder, Stantec) and the discovery evidence of NRC manager Gary Fudge was relied on to show NRC knew or ought to have known of PFAS migration toward class members’ lands and drinking water by March 27, 2013.
• The plaintiffs argued NRC failed for roughly 2.5 years to disclose a 2013 environmental assessment indicating PFAS contamination on NRC lands and potential offsite migration, and failed to drill offsite boreholes despite repeated recommendations, supporting a claim of high-handed or indifferent conduct.
• A key legal question was whether the proposed punitive damages amendment disclosed a reasonable cause of action and met the “worthy of trial” threshold under Rule 26.01 and the Court of Appeal guidance in Marks and Andersen Consulting.
• The court assessed whether, assuming the pleaded facts were true, NRC’s delay in warning neighbouring residents of possible PFAS contamination could meet the Whiten v. Pilot standard of “malicious, oppressive and high-handed conduct” that offends the court’s sense of decency.
• Ultimately, the court allowed amendments to add punitive damages as a common issue and rejected NRC’s cross-motion to strike and to force further amendments, while also removing Carleton University as a defendant and one plaintiff from the style of cause.

Background and parties

The proceeding arises under Ontario’s Class Proceedings Act, 1992. The representative plaintiffs, Gordon Egan, Kevin Kunka, Scott Petrie, and Paul Crozier, brought a proposed class action on behalf of neighbouring residents whose lands and drinking water were allegedly contaminated by per- and polyfluoroalkyl substances (PFAS) originating from the National Research Council of Canada’s (NRC) National Fire Laboratory and fire research facility. The defendants initially named were NRC and Carleton University. NRC operated the test site at which fire-fighting foams containing PFAS were used, stored, handled, applied and disposed of, and where substances containing contaminants were burned. Over many years, PFAS-laden effluent was allegedly discharged into the environment, ultimately affecting groundwater and surface water moving toward the plaintiffs’ properties. In this decision, the court also records that the style of cause is amended, on consent, to remove Carleton University as a defendant and to remove Scott Petrie as a plaintiff, leaving NRC as the sole remaining defendant in the action.

Contamination and alleged failures by NRC

According to the plaintiffs’ allegations and the environmental record, PFAS compounds were used at the NRC site from about 1981 to 2014, and for that entire period 100 per cent of the PFAS chemicals used in testing were discharged directly into the environment. Several technical reports are said to have alerted NRC to the risk that PFAS contaminants were migrating offsite. A 2004 Aqua Terre report and a 2009 Golder report raised environmental concerns with the discharge of fire-fighting wastewater and recommended steps that, the plaintiffs say, were not passed up the authority chain within NRC. Golder in 2009 inferred that groundwater was flowing towards neighbouring lands, attached the highest risk rating in its grading system, and questioned whether NRC’s discharges to the natural environment should be allowed to continue. By 2013, a Stantec Final Phase II Environmental Site Assessment Report documented PFAS contamination in soil, groundwater and surface water, including in a creek on NRC lands that drained across the plaintiffs’ and class members’ properties, eventually discharging into the Mississippi River. The plaintiffs allege this creek was a pathway by which PFAS entered a sinkhole in front of a class member’s residence and then entered groundwater flowing beneath class members’ lands. The evidentiary record from discovery also highlighted that, as of 2014, NRC had no controls in place to prevent PFAS migration offsite, and that, despite recommendations from the Ministry to drill groundwater monitoring wells or boreholes offsite, NRC did not drill such wells on the class members’ properties to assess the extent of offsite groundwater contamination. Even on NRC’s own eastern lot line, the agency allegedly waited up to 1.5 years from the start of onsite monitoring before drilling a borehole to check for PFAS migration, which, when finally done, showed that contamination was in fact moving toward the neighbouring lands.

Procedural history and prior certification ruling

The class action had been previously certified by order dated July 7, 2021. At that certification motion, punitive damages were not certified as a common issue because the record then available lacked sufficient evidence of a deliberate delay in notifying class members that their drinking water might be contaminated with PFAS chemicals. The original Statement of Claim asserted that NRC knew the class members’ drinking water had been contaminated and delayed informing them for approximately 2.5 years. In his earlier certification reasons, the judge noted that, at that stage, the pleadings are deemed proven, and expressly left the door open: if evidence were later discovered showing that NRC knew and failed to notify the proposed class of possible contamination of their drinking water by toxic PFAS compounds for approximately two years, it would not be plain and obvious that the plaintiffs could not succeed on a punitive damages claim. The court described the punitive damages claim as “premature” on the then-available evidence and indicated the pleadings could be amended if new evidence emerged in productions or discovery. In a subsequent judgment dated April 25, 2025, the same judge observed there was evidence that NRC ought to have known that PFAS compounds had migrated onto the plaintiffs’ lands and could have contaminated their drinking water, and that there was at least some basis in fact that NRC knew or ought to have known of possible contamination of the plaintiffs’ drinking water by 2013. Against this procedural backdrop, the plaintiffs brought the present motion to amend.

The motion to amend to add punitive damages as a common issue

The plaintiffs moved to amend paragraph 48 of their Statement of Claim and to add a new paragraph 49, both aimed at strengthening their punitive damages claim and aligning the pleadings with the post-certification evidentiary record. The proposed amended paragraph 48 alleges that the conduct of NRC and Carleton University (although Carleton is later removed from the style of cause) in relation to the use, storage, handling, application and disposal of fire-fighting foam containing PFAS, and the burning of substances containing contaminants, was indifferent, reckless, wanton, without care, deliberate, callous, wilful and in complete disregard of the rights and safety of the plaintiffs and class members, thereby warranting punitive damages. It also alleges that, after discovering contamination, NRC conducted an environmental investigation and testing but failed to make full, prompt and candid disclosure of the results and of the contamination to the plaintiffs and class members. The new paragraph 49 ties the punitive claim specifically to the March 27, 2013 Stantec Final Phase II Environmental Site Assessment Report. It pleads that this report unambiguously documented PFAS contamination in soil, groundwater and surface water on NRC lands, including a creek that drains across the plaintiffs’ and class members’ lands, and that NRC knew or ought to have known of possible PFAS contamination of their drinking water by no later than March 27, 2013. Despite this, NRC allegedly did not disclose the report’s results or even the existence of PFAS contamination on its lands until December 23, 2015, thereby delaying disclosure for more than two and a half years. That delay, coupled with the nature of the contamination and the surrounding circumstances, is said to warrant punitive damages. In addition to these punitive-related amendments, the plaintiffs also sought—and on consent obtained—an amendment to the style of cause to remove Carleton University as a defendant and to delete Scott Petrie as a plaintiff. They further requested that a pre-trial date be fixed and asked for costs on a substantial indemnity basis, although the court ultimately reserved on costs and set a timetable for written submissions.

The defendant’s cross-motion and objections

NRC responded with a cross-motion seeking to strike portions of the fresh as amended Statement of Claim that had effectively been rejected at certification in 2021, including the punitive damages common issue and other pleadings specified in its cross-motion materials. NRC argued that the amended punitive damages claim should not be permitted because it disclosed no reasonable cause of action and had no reasonable prospect of success, even if the pleaded facts were assumed to be true. According to NRC, its alleged failure to warn or to drill boreholes or monitoring wells on class members’ lands, and its alleged delay between March 2013 and December 2015 in notifying residents of possible PFAS contamination, did not, as a matter of law, support a claim that could meet the rigorous standard for punitive damages. NRC did not, however, argue that it would suffer non-compensable prejudice or that the proposed amendments would cause undue delay. NRC also contended that the plaintiffs’ attempt to expand the common issues beyond what had been set out in the Certification Order—particularly by returning to matters such as trespass and Ontario Water Resources Act (OWRA) claims that had not been certified as common issues—should be rejected. NRC’s cross-motion asked the court to compel the plaintiffs to further revise their pleading to conform more strictly to the earlier certification ruling.

Legal framework for amending pleadings and punitive damages

The court grounded its analysis in Rule 26.01 of the Rules of Civil Procedure, which states that on a motion at any stage of an action, the court shall grant leave to amend a pleading on such terms as are just, unless prejudice would result that cannot be compensated by costs or an adjournment. The judge summarized the well-known principles from Marks v. Ottawa (City): amendments should be allowed unless they cause injustice not compensable in costs; the proposed amendment must be an issue worthy of trial and prima facie meritorious; no amendment should be allowed that, if originally pleaded, would have been struck; and the proposed amendment must contain sufficient particulars. The court also drew from Andersen Consulting v. Canada (Attorney General), where the Court of Appeal held that amendments are presumptively approved unless they cause non-compensable prejudice or delay, are scandalous, frivolous, vexatious or an abuse of process, or disclose no reasonable cause of action or are legally untenable. As punitive damages were central to the proposed amendment, the judge turned to the Supreme Court of Canada’s leading authority, Whiten v. Pilot Insurance Co. In Whiten, punitive damages were described as an exceptional remedy reserved for “malicious, oppressive and high-handed conduct” that “offends the court’s sense of decency” and marks a significant departure from ordinary standards of decent behaviour. The question for this motion was not whether punitive damages should actually be awarded, but whether, assuming the pleaded facts could be proven, it was plain and obvious that the plaintiffs could not succeed on such a claim.

Court’s assessment of the evidentiary record for punitive damages

In assessing whether the punitive damages amendment was “worth of trial” and legally tenable, the judge reviewed the post-certification evidence, particularly the Stantec report and the discovery testimony of NRC representative Gary Fudge. The record included multiple environmental reports indicating that PFAS contamination had been confirmed on NRC lands and that groundwater flow was inferred to be toward the plaintiffs’ properties. There was evidence that the Ministry had repeatedly recommended drilling offsite boreholes or monitoring wells, but NRC declined to do so for years, even though such drilling was acknowledged as the only way to properly assess the extent of offsite contamination beneath the class members’ lands. Mr. Fudge was unable to explain why NRC refused to drill offsite despite these recommendations. Nor could he specify, after more than 11 years since PFAS was first discovered on the site, what further information or testing NRC needed before commencing offsite drilling to determine the extent of contamination under neighbouring properties. The timeline alleged—receipt of the Stantec report in March 2013 and first notification to residents only in December 2015—suggested a delay of approximately two and a half years in warning residents that their drinking water might be contaminated by toxic PFAS compounds. At this procedural stage, the court noted that the factual allegations in the pleadings are deemed to be true and that the merits of the claim are not to be assessed in detail. The question was narrow: whether, if the alleged conduct was proven, there was no reasonable prospect that punitive damages could be awarded.

Decision on the motion to amend and the cross-motion

The judge concluded that he could not say, as a matter of law, that NRC’s alleged conduct—particularly its failure to warn neighbouring residents of potential PFAS contamination of their drinking water and its failure to test for contamination through offsite boreholes, despite knowledge or deemed knowledge of the risk—could not amount to conduct that “offends the court’s sense of decency” within the meaning of Whiten. On that basis, the proposed amendments relating to punitive damages were found to disclose a legally tenable claim and to be an issue worthy of trial. The motion to amend the Amended Amended Statement of Claim to strengthen and clarify the claim for punitive damages, as set out in paragraphs 48 and 49 of Schedule “A”, was therefore granted. Correspondingly, the Certification Order was amended to add a claim for punitive damages as a certified common issue, meaning that the availability of punitive damages will be determined on a class-wide basis rather than solely in individual issues trials or individual assessments. The judge also dealt with related procedural matters. On consent, the style of cause was amended to remove Carleton University as a defendant, and to remove Scott Petrie as a plaintiff. The court denied NRC’s cross-motion seeking further amendments to narrow or recast the plaintiffs’ Amended Amended Statement of Claim, holding that the Certification Order already defines the common issues and that there was no basis to compel additional changes of the sort NRC sought. The court also declined to entertain requests to amend the Certification Order to add trespass and Ontario Water Resources Act (OWRA) issues as common issues, noting that those points had not been argued and therefore dismissing that aspect of the plaintiffs’ requests.

Pre-trial scheduling and costs

With respect to the further conduct of the proceeding, the judge directed that a pre-trial conference date be set by the trial coordinator, but only after NRC has brought its planned motion for summary judgment. This scheduling was expressly made without prejudice to NRC’s ability to proceed with its summary judgment motion, signalling that dispositive motions will continue to shape the future course of the litigation. On costs, the court did not fix any amount in this decision. Instead, it ordered a timetable for written submissions: the plaintiffs have 10 days to serve brief submissions on costs, NRC has 10 days to respond, and the plaintiffs have 7 days to reply. Costs will thus be determined at a later date based on those written submissions, and no specific dollar figure is set out in this ruling.

Outcome and overall result, including successful party and monetary amount

In overall terms, the plaintiffs were the successful party on this motion. They achieved their key objective of amending the Statement of Claim and the Certification Order to include punitive damages as a common issue, while NRC’s cross-motion to pare back the pleadings was rejected and its attempts to keep punitive damages out of the certified common issues were unsuccessful. The case itself, however, remains at an interlocutory stage; this decision does not determine liability, compensatory damages, or whether punitive damages will actually be awarded at trial or on any subsequent motion. As to monetary consequences, this ruling does not grant or quantify any damages, punitive or otherwise, nor does it fix any specific amount for costs. The total monetary award, including any costs or damages in favour of any party, cannot be determined from this decision alone because the court has reserved on costs and has not yet adjudicated the merits or damages claims.