Law Times

Law Times • January 6, 2014 Page 7 COMMENT Sriracha's sweet smell a reminder that residential uses rule I rwindale is a sleepy little town in Los Angeles County in southern California that's home to about 1,500 residents and a brand-new manufacturing facility for the world-famous Sriracha hot sauce manufactured by Huy Fong Foods Inc. This spicy hot Thai chili sauce is popular the world over. It's so popular Bon Appetit magazine named it the ingredient of the year; Lay's now makes a Sriracha-flavoured potato chip; and, believe it or not, one of the most popular Halloween costumes this year was based on the distinctive Sriracha sauce bottle and rooster logo. And almost all of this Sriracha sauce — some 200,000 bottles a day — came from the plant in Irwindale. That was the case until the City of Irwindale sued the makers of Sriracha sauce for an injunction related to nuisance. It complained the pungent smells of chili and garlic emanating from the plant every day were so intense they were interfering with the reasonable use and enjoyment of neighbouring properties. Sriracha sauce only scores 2,200 on the Scoville scale for chili pepper heat. This is spicier than Frank's RedHot that barely registers on the Scoville scale at a measly 450 but milder than, say, Tabasco sauce at 3,500 and positively impotent compared to Blair's Reserves. It dominates the world of hot pepper sauces at around 13,500,000 on the Scoville scale. Be that as it may, it's hard to imagine what it must be like to live downwind from a factory, no matter how modern, that turns out, from scratch, a million bottles of Sriracha sauce per week. Typically, municipal zoning bylaws will prevent cases like the Sriracha dispute from ever arising in most communities with industrial, agricultural or first, it doesn't allow it to manufacturing facilities zoned a The Dirt continue if the neighbour far enough away from more complains. In 1879 case sensitive uses like residential of Sturges v. Bridgman, a docones to avoid nuisance comtor moved into a home that plaints. However, that's not was adjacent to that of a candy always the case. Sometimes, maker operating a candy factowhether because of legal nonry out of the back of his house. conforming uses or some The doctor complained shortly other reason, residential develafter moving in, not so much opment finds itself legally coabout the smell of the candy Jeffrey Lem existing right beside, or at least but rather about the sound of close to, incompatible competing uses, a the candy-making machinery. The English situation that gives rise to the potential for Court of Appeal held that even though the the tort of nuisance. doctor was the one who was moving to the The Huy Fong Foods matter affirms nuisance, that didn't allow the candy makthe general proposition that existing resi- er to continue to be a nuisance. The docdential uses will almost always succeed in tor had a legitimate right to stop the candy nuisance whenever the residential owners maker from interfering with his reasonable were the first to be there and the nuisance enjoyment of his property. use moves into the neighbourhood some About 100 years later in Miller v. Jackson, time later. In the Irwindale case, Huy Fong the English Court of Appeal again affirmed was clearly the newcomer, having moved that just because a homeowner is the one in to the neighbourhood and building moving to the nuisance, the newcomer could its massive, state-of-the art sauce facility still have an action available with respect to the within breeze-accessible distance of exist- nuisance. Actually, the tortious landowner in ing residential developments. What may Miller was neither industrial nor commercial; come as a surprise to many practitioners, instead, it was the cricket club whose members however, is that, in general, the same rules kept hitting balls into the backyards of newly apply even if the nuisance use was there built houses at the edge of the cricket grounds. first and the surrounding lands were subse- In Miller, the homeowners were clearly the quently redeveloped for residential use. In newcomers, but like in Sturges, the court again other words, the downwind homeowners held that moving to the nuisance was no dein Irwindale might still have been success- fence to the tort of nuisance (although in ful in curtailing production at the Sriracha Miller, the court denied injunctive relief with plant even if the factory was the incumbent damages payable in lieu for the loss of the enand those homeowners had been the ones joyment of the affected backyards). moving to the nuisance. It's likely the English line of cases is also The English courts have always held the law in Canada, although there are a that, even if the nuisance was there number of lawyers, mainly practising in ru- ral communities, who staunchly maintain that city-slicker homeowners shouldn't be able to move to the countryside and then sue to try to stop the sounds and smells of agricultural uses emanating from neighbours. Of course, what constitutes nuisance in a given scenario will vary on a case-bycase basis depending on the surrounding neighbourhood and will change over time. The sounds and smells that constitute a nuisance in Rosedale or Point Grey may not interfere with the reasonable use of property in, say, the industrial heartland of Hamilton. Time will tell if Huy Fong Foods will appeal the decision. Until then, fans of Sriracha sauce should probably start hoarding bottles. The injunction, although just interlocutory, is likely to severely curtail production until alternative production facilities come on line. With a production run of a million bottles a week, that might not happen right away. LT uJeffrey W. Lem is a partner in the real estate group at Miller Thomson LLP. His email address is jlem@millerthomson.com. CORRECTION A Dec. 2, 2013, Law Times article indicated none of the Law Society of Upper Canada regulatory proceedings that arose out of judicial complaints since the launch of the civility protocol had concluded in a professional misconduct finding based on incivility. In fact, out of 54 closed complaints, five cases resulted in incivility findings. Ontario's health-care future lies in non-profit clinics D oes the practice of law take place only in the courtroom? Of course not and neither does the practice of medicine happen only in hospitals. It's a risky business going to a hospital for a minor procedure, though. Hospital-induced infections are no minor matter and the cost of having state-ofthe-art infrastructure and the attendant acute care is expensive. With health care accounting for about 42 cents of every dollar spent by the province and in a culture where public access to care is tantamount, trying to focus the discussion on how to better deploy funds and resources is an even bigger risk because it leaves politicians open to accusations of dismantling the sacred concept of medicare. So when Health Minister Deb Matthews announced last month Ontario was going to shift procedures and minor surgeries away from hospitals to non-profit clinics, there were immediate cries about the privatization of medicine. The truth, however, is we've had private clinics since the Supreme Court of Canada ruled on R. v. Morgentaler in 1988. In effect, that ruling also cracked the door open for private surgical centres and so today we have about 1,000 clinics for abortions, hernia operations, cataracts, and other situations where OHIP pays for the procedure but the patients often pay a facility fee. Almost all of them are for profit. However, the Canada Health Act says facility fees charged for a medically necessary procedure are illegal if paid by the assembly lines for procedures patient and not the provincial require plan. But no one really seems Queen's that don't such as an overnight stay cataracts to tackle the issue head on. It's Park and colonoscopies. just too risky. These clinics, according All of this is about to to Matthews, will work with change. For one, Ontario is local health integration netbroke, and two, the federal works and hospitals. More government is scaling back interestingly, she said, they health-care transfer payments will "operate under existing under a new formula that will legislation and quality assurcut Ontario's subsidy by $335 ance frameworks to ensure million a year. Ian Harvey oversight and accountability." Yet critics always herald the The move, she said, results sanctioning of private clinics to take over procedures from hospitals from two 2012 reports: Ontario's action as the first blow to public health care and plan for health care and the report by the beachhead from which two-tier medi- economist Don Drummond that also reccine will emerge and, eventually, full-scale ommended shifting patients from acutecare settings to community-care facilities. privatization will take root. The benefits are better and faster acThere were similar claims when Dr. Jacques Chaoulli won a Supreme Court of cess and less cost, she said. "The KensCanada decision in 2005 that struck down ington Eye Institute in Toronto has sucQuebec's ban on private health insurance cessfully used state-of-the-art equipment to reduce average wait times for cataract when waits are unreasonably long. The model, however, seems to be work- surgery below the provincial target of 182 ing in Quebec where there are some 56 or days. In 2012, over 1,400 cataract surgermore procedures available at private clin- ies were transferred to the clinic from ics such as hip and knee replacements and four downtown hospitals." She doesn't mention that 5,800 other other surgeries. Critics see it as the death of medicare by a thousand cuts, but private surgeries also took place there. Despite the praise from Matthews, Onclinics have proliferated and hospitals are tario Council of Hospital Unions president still functioning. Ontario is about to go down the same Michael Hurley calls the shift "alarming." "In Ontario, quality control problems path. Matthews said Ontario would create new "community-based specialty clin- and illegal user fees have haunted the priics offering select OHIP-insured, low-risk vate clinics and the minister has been a hands-off manager, leaving the public at routine procedures." There isn't a lot of detail, but the risk, vulnerable, and exploited," he said. "The private clinics will process as clinics will essentially be high-volume www.lawtimesnews.com many colonoscopy, endoscopy, dialysis, and other procedures as humanly possible with the simplest medical conditions." The upshot, he warned, is clinics will "cherry-pick" patients and leave public hospitals with the complicated and highercost cases without the benefit of the simpler procedures to "offset the cost." He cited studies showing higher death rates at private clinics and that costs in Britain have been much higher than forecast while the loss of patients has forced some hospitals into bankruptcy. As in Quebec, the union worries jobs at the clinics won't be unionized while promedicare physicians have dubbed it an approach that will have people pay more for less. The Ontario Medical Association, however, has long championed the idea. It says it will relieve the burden for hospitals that can now focus on more lifethreatening issues and will cost less because clinics don't have the overhead and can focus on a single service. The key will be the non-profit status of the clinics. Whoever wins the next election will have to deal with this issue because it isn't going away. It will be a tough decision, but that's what leadership is about. There's a fiscal and social need to better manage access to health care because of the ultimate risk our medical system could soon collapse under its own weight. LT uIan Harvey has been a journalist for 35 years writing about a diverse range of issues including legal and political affairs. His e-mail address is ianharvey@rogers.com.

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