Assignment: - Trail Smelter Arbitration (United State V.

Canada) Case Review

Course Code: LAW- 402
Course title: Environmental Law
Submitted By
Sadia Chowdhury
181-26-1173
Batch: 32/A
Daffodil International University
Submitted To
Ferdousi Begum
Senior Lecturer
Department of Law
Daffodil International University
Date of Submission: 30- 11- 2020
 Trail Smelter Arbitration (United State V. Canada)

 Introduction:
The Trail Smelter arbitration, generally considered one of the cornerstones of international
environmental law, is an ambiguous and puzzling piece of legal reasoning. The famous dictum
in that case appears to stand for a proposition – states are strictly liable for trans-boundary
environmental damage arising on their territory – that is not generally accepted in international
law. In this paper, the difficulties of reconciling the Trail Smelter arbitration with contemporary
international law on environmental protection and on state responsibility are analyzed, and
recent developments in the field of responsibility and liability for trans-boundary damage are
assessed. It is argued that the process of trying to make sense of Trail and seeking to extract
lessons from this case can help us to better understand international environmental law – and in
particular the difficulties that this body of law poses to the framework of international law.

 Procedural History:

The first significant development in the Trail Smelter dispute was its transition from a
dispute between two private parties 
Into a dispute between two states. One of the circumstances that led to the
internationalizing of the dispute is the above mentioned US/Canadian border. In the
past the activities at the Cominco Smelter had affected Canadian property. 

 1)Proceedings before national courts:-

At first glance it seems no more than logical that the issue at hand in the Trail
Smelter arbitration, being a private dispute, should be put before a national court.
On the surface it seems there were two conceivable scenarios in which national
jurisdiction could have played a role. The first scenario involved accessing the
courts in the state where the damage of the pollution was felt, i.e. the US farmers
bringing a claim in a US court. This would mean that a foreign company was
sued for damages in a US court. The second scenario involved bringing a claim
in the court of the state where the pollution originated, i.e. the US farmers
bringing a claim in a Canadian court. In this case foreign nationals would be
bringing a case against a national company in a Canadian court.

 2. United States court:-

As mentioned above one possible approach to resolving the Trail Smelter dispute
was for the US farmers to bring their case in front of a US court. At the time the
Trail Smelter dispute took place the farmers did not succeed in following this
course of action. Several obstacles, both legal and political, explain the inability
of the farmers to have their claim heard by a US court. However, these obstacles
have not remained static in the last 70 years; some have disappeared while
others have changed.
  3.Canadian court:-

The US farmers bringing their claim before a Canadian court is the second
manner in which this dispute could reach a resolution in a national court. Above it
has been demonstrated that, for a victim of a Trail Smelter type dispute, to
bring a claim in his or her own country raises several difficult issues. The barriers
provided by the issue of personal jurisdiction, extraterritorial application of laws
and finally finding enforcement of a jurisdiction in the court of the defendant,
although they are not insurmountable, are certainly not to be taken lightly. In fact,
the difficulties associated with bringing a trans frontier pollution case before the
court where the injury occurred led professor Slammers to state, specifically with
respect to the enforcement issue, that:
"Indeed the obstacles may be such that instead of having resort to its own courts
and all the practical advantages which such a resort would imply, the plaintiff
would still be better off instituting proceedings against the defendant in the courts
of the country of origin of the interference".

 Fact-

The United States (P) sought damages from Canada by suing them to court and also
prayed for an injunction for air pollution in the state of Washington, by the Trail Smelter,
a Canadian corporation which is domiciled in Canada (D).
The Trail Smelter is located in Trail, British Columbia in the south-western corner of the
Kootenai’s, which is known as a mineral-rich area. The resultant effect of from the sulfur
dioxide from Trail Smelter resulted in the damage of the state of Washington between
1925 and 1937. ... This led to the United States (P) suit against the Canada (D) with an
injunction against further air pollution by Trail Smelter he Trail Smelter dispute was a
trans-boundary pollution case involving the federal governments of both Canada and
the United States, which eventually contributed to establishing the harm principle in the
environmental law of transboundary pollution.
Synopsis of Rule of Law. The duty to protect other states against harmful acts by
individuals from within its jurisdiction at all times is the responsibility of a state.
The Trail Smelter became a factor in the Canadian government's efforts to establish a
smelting industry in Canada, which had sent ores to American smelters for processing
in the past. The Trail Smelter operation grew, adding other local mines to the portfolio,
and were incorporated as the Consolidated Mining and Smelting Company of Canada
(Cominco) in 1905, with continuing support from the CPR. When completed in 1895, the
smelter could process 250 tons of ore daily and had smokestacks 150 feet high to help
disperse the fumes. During the arbitration that followed the dispute, the tribunal
commented that by 1906 Trail had 'one of the best and largest equipped smelting plants
on this continent. ‘By 1916 the Trail Smelter was producing monthly outputs of 4,700
tons of Sulphur, but with post World War I expansion and technological improvements
to the smelting process, the company doubled the smelter's output throughout the
1920s and was producing 10,000 tons monthly by 1930.[2]
Most of Trail's male residents worked for the smelter and local businesses and farmers
relied on the income from smelter employee salaries. Smoke from the smelter was seen
by many residents as a sign of prosperity and continued employment; local residents
commented that the "thicker the smoke ascending from Smelter Hill the greater Trail's
prosperity. On the other hand, local farmers complained about the effects of the toxic
smoke on their crops, which eventually led to arbitration with Cominco between 1917
and 1924, and resulted to the assessment $600,000 in fines being levied against the
defendant. The fines were to serve as compensation for smoke damage to crops and
included Cominco buying four complete farms (out of sixty farms involved) closest to the
stacks. No government regulations of the smelter's output were imposed on Cominco
following the 1924 decision. 
As a direct consequence of the local dispute and arbitration, Cominco looked for ways
to reduce the smelter's smoke output while increasing the smelter's production. The
initial solution involved increasing the height of the smokestacks to 409 feet in 1926 in
an effort to disperse the smelter's smoke by pushing it higher into the atmosphere, but
this local solution proved to be a problem for their Washington neighbors.

 Legal issues:

 Whether the plant should be closed to refrain from further damage to the state of
Washington and, if so, to what extent?
 Had damage been done to Washington State by the smelter since January 1,
1932?      
 If the smelter was found to have done damage, should it be made to refrain from
doing so in the future?      
 Should the smelter operate under any restrictions?   
 Should any compensation be paid in light of the answers to questions 2 and 3?

 Decisions of the judges

Indemnity and compensation must be paid for UD$ 78.000 Next cases would rely on
the decisions of the Supreme Court of U.S. 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. Canada was responsible in international
law for the conduct of the Trail Smelter. At the end, Canada paid the United States
US$428,000 for damages plus probably around US$50,000 to pay for scientists and
equipment to monitor sulfur emissions at Trail from 1937 to 1942.

 Analysis

The Tribunal attempted at finding a balanced solution. The smelter was able to continue
operations and the farmers were no longer harmed by the smoke and received appropriate
compensation. Sovereignty was the general goal which is illustrated in the language of the
decision. The final decision of the Tribunal held that the Dominion of Canada is responsible in
international law for the actions of the smelter (Trail Smelter Arbitration, 1941). The Tribunal
declared 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,
when the case is of serious consequence” (Trail Smelter Arbitration, 1941, emphasis mine).
These are the famed words of the Trail smelter arbitration and sum up the relevance of this
case. A state can pollute its own land as much as it wants as long as it abides by law. Once that
pollution crosses an international boundary though, and is of serious consequence, the state
has violated the sovereignty principle of international law. The Tribunal established that the
injury to cleared and uncleaned lands was serious enough to warrant compensation. It did not
find that the damage on livestock and the property in the town of Northport was serious enough
to be compensated for. What can be taken away from this is that proving damage was caused
by the pollutant is not enough. It must be proved that the damage is serious. The definition a
court gives to “serious” is arbitrary and depends on the circumstances and the court. It should
be stated that the decision of the court was not meant to impose legally binding obligations on
both parties. The decisions reflect an aspiration, or a principle of the international justice
system. There are two principles that are often discussed in light of this case. The first was
established in the provision above, that a state has an obligation to prevent transboundary
harm. The second is referred to as the polluter pays principle. The Tribunal used previous
United States Supreme Court decisions to help decide what route to take in deciding this case.
The Tribunal used the principle set up in United States Supreme Court in Story Parchment
Company v. Paterson Parchment Paper Company (1931) that relief must be provided for the
injured person and accountability to the wrongdoer. Furthermore in the absence of certainty it is
just for Juries to act on reasonable inference as well as direct proof (Trail Smelter Arbitration,
1938). This remedy came in two forms, each of which put the financial burden on Consolidated
and Canada, the polluters. The first remedy was direct monetary compensation to the farmers.
The second remedy was changing the way operations took place at the smelter to reduce the
amount of harmful chemicals emitted during processing. It could also be argued as an
appropriate and fair decision because it preserved economic interests while ending the problem
that had been presented.

 Summary:-

This case was truly a landmark case in term of international law.

Never before had there been decision a by the World Court or any other international
justice system regarding an instance so remote and localized. The farmers of Northport
probably had no idea that they were making history. What started as a grassroots effort
to rid the area of noxious smoke ended in a case cited directly or indirectly in countless
environmental law cases? Those involved in the case were not trying to make history.
The farmers were merely seeking compensation for what they saw as a violation of their
rights. The wrongdoer, Consolidated Mining and Smelting Limited, were definitely not
trying to make history. Consolidated was doing everything they could to squash the
issue and keep it as low key and local as possible. Due to the geographic nature of the
dispute these goals were not possible and history was effectively made as the dispute
went into the hands of international law institutions. The results of this case are pivotal
to international environmental law. This case put into words the unspoken notion of
transboundary harm and a nation’s obligation to do everything they can to prevent it.
Furthermore, the results of this dispute put definitive blame on the polluter and
established that the punishment would be whatever payment is necessary to remedy
the harm.