Brief Fact Summary. 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).

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.

Facts. The Tail Smelter located in British Columbia since 1906, was owned and operated by a Canadian corporation. 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.

Issue. Is it the responsibility of the State to protect to protect other states against harmful acts by individuals from within its jurisdiction at all times?

Held. Yes. It is the responsibility of the State to protect other states against harmful act by individuals from within its jurisdiction at all times. No state has the right to use or permit the use of the territory in a manner as to cause injury by fumes in or to the territory of another or the properties or persons therein as stipulated under the United States (P) laws and the principles of international law.By looking at the facts contained in this case, the arbitration held that Canada (D) is responsible in international law for the conduct of the Trail Smelter Company. Hence, the onus lies on the Canadian government (D) to see to it that Trail Smelter’s conduct should be in line with the obligations of Canada (D) as it has been confirmed by International law. The Trail Smelter Company will therefore be required from causing any damage through fumes as long as the present conditions of air pollution exist in Washington.So, in pursuant of the Article III of the convention existing between the two nations, the indemnity for damages should be determined by both governments. Finally, a regime or measure of control shall be applied to the operations of the smelter since it is probable in the opinion of the tribunal that damage may occur in the future from the operations of the smelter unless they are curtailed.

Discussion. Responsibility for pollution of the sea or the existence of a duty to desist from polluting the sea has never been laid at the feet of any country by any international tribunal. Although regulation of pollution is just commencing, it must ensure that there is equilibrium

against freedom of the seas guaranteed under general and long established rules of international law.

TRAIL SMELTER ARBITRATION CASE( UNITED STATES VS CANADA) 1941, U.N. Rep. Int'L Arb. AWARDS 1905 (1949)

INTRODUCTION:-

The Trail Smelter Case1 arose in the field of late 1950's and came up with the issue of International Environmental Law. In this case ‘it was damage caused by one State to the environment of the other that triggered the legal claim. Legally the issue was not viewed as different from damage caused to the public or private property, for instance by the inadvertent penetration of a foreign State's territory by armed forces. For the first time an International Tribunal propounded the principle that as State may not use, or allow its national's to use, its own territory in such a manner as to cause injury to a neighboring country'2. The facts of the case are lead below :-

‘The Columbia River rises in Canada and flows past a lead and zinc smelter located at Trail, in British Columbia (Canada). The smelter company was alleged to cause damage to trees, crops and land in the American States of Washington.3 The climate from beyond Trail on the United States boundary is dry, but not arid. The smelter was built under U.S. auspices, but had been taken over. In 1906, the Consolidated Mining and Smelting Company of Canada, Limited acquired the smelter plant at Trail. Since that time, the Canadian company, without interruption, has operated the Smelter, and from time to time has greatly added to the plant until it has become one of the best and largest equipped smelting plants on the American continent.4 In 1925 and 1927, stacks, 409 feet high, were erected and the smelter increased its output, resulting in more sulphur dioxide fumes. The higher stacks increased the area of damage in the United States. From 1925 to 1931, damage had been caused in the State of Washington by the sulphur dioxide coming from the Trail Smelter, and the International Joint Commission recommended payment of $350,000 in respect of damage to 1 January, 1932. The United States informed Canada that the conditions were still unsatisfactory and an Arbikal Tribunal was set up to "finally decide" whether further damage had been caused in Washington and the indemnity due, whether the smelter should be required to

1. 1941, U.N. Rep. Int'L Arb. AWARDS 1905 (1949)

2. Cassese Antonio, International Law, Oxford University Press, 2nd edition, 2005, New York, 484

3. Ibid pg 484.

4. Noah D. Hall, FOURTH IUCN ACADEMY OF ENVIRONMENTAL LAW WORLDWIDE COLLOQUIUM: IMPLEMENTING ENVIRONMENTAL LEGISLATION: THE CRITICAL

ROLE OF ENFORCEMENT AND COMPLIANCE, Pace Environmental Law Review, Winter, 2007, 5

cease operation; the measures to be adopted to this end; and compensation due. The Tribunal was directed to apply the law and practice of the United States as well as international law and oractice.'5 ‘The United States Government, on February 17, 1933, made represents to the Canadian Government that the existing conditions were entirely unsatisfactory and that damage was still occurring and diplomatic negotiations were entered into, which resulted in the signing of the present convention.'6

‘The Court held Canada responsible for the conduct of the Trail Smelter and enjoined it to pay compensation to United States. The court also provided for future monitoring of the effects of the factory's activities on the environment, to prevent possible future damages to the United States environment.'7

‘The subsequent diplomatic negotiations led to the United States and Canada signing and ratifying a Convention in 1935. Through the Convention, the two countries agreed to refer the matter to a three-member arbitration tribunal composed of an American, a Canadian, and an independent chairman (a Belgian national was ultimately appointed). The arbitration tribunal was charged with first determining whether damages caused by Trail Smelter continued to occur after January 1, 1932 and, if so, what indemnity should be paid. Under the Convention, Canada had already agreed to pay the United States $ 350,000 for damages prior to 1932, based on the findings of the IJC. The arbitration tribunal addressed this first question in this context of the case determining that the damages caused by the Canadian smelter to properties in Washington State from 1932 to 1937 amounted to $ 78,000 (equivalent to approximately $ 1.1 million in 2006). The arbitration tribunal's more difficult, and ultimately more significant charge, was to decide whether the Canadian smelter should be required to refrain from causing damage in the State of Washington in the future, and what measures or regime, if any, should be adopted or maintained by the smelter, in addition to future "indemnity or compensation."

5. http://www.unescap.org/DRPAD/VC/document/compendium/int7.htm

6. Mark W. Jarris & John E. Noyes, Cases and Commentary on International Law, West Publishing Company, 1997, St. Paul, 586

7. Supra note 2 pg 484

To answer these questions, the tribunal was directed to apply the law and practice followed in dealing with cognate questions in the United States of America as well as International Law and Practice, and give consideration to the desire of the High Contracting Parties to reach a solution just to all parties concerned.'8

The Trail Smelter case came up with the issue of "duty" of states to "prevent transboundary harm" and invoking the "polluter pays" principle. Firstly we move on to the ‘Transboundary Harm' issue. ‘Transboundary Harm proceeds in three parts. Part One examines the historical foundations of the case, its influence on international environmental law, and the smelter's

continuing yet largely unknown toxic legacy. Part Two examines the case's contemporary significance for the law of transboundary environmental harm. Part Three looks beyond environmental law to examine the significance of the Trail Smelter arbitration for legal responses to other transboundary harms, from international terrorism to Internet torts.'9 Illustratively:

Part One examination ‘begins with a detailed account of the history surrounding the dispute, describing the important roles of the private parties involved and examining the actions of the state actors in arbitrating the dispute on behalf of the parties. Part One also examines the "jurisprudential legacy" of the decision in an increasingly prevention-focused, regulatory world. The usefulness of the Smelter case is limited by the fact that the dispute turned more on the rights of states as "sovereign equals" and less on the undesirability of transboundary pollution. Unlike the situation in Trail, in contemporary disputes the cause of damages is often unclear and the disputing countries often lack a history of cooperation and "reciprocal" interests which counsel them toward cooperation and moderation. The enduring significance of the "due diligence" obligation was created by the Tribunal. The obligation "not to cause serious environmental harm" - was originally intended to ensure the continuing compliance of the Trail Smelter with

8. Supra note 4 pg 6

9. Stepan Wood, TRANSBOUNDARY HARM IN INTERNATIONAL LAW LESSONS FROM THE TRAIL SMELTER ARBITRATION, EDITED BY REBECCA M. BRATSPIES & RUSSELL A. MILLER (NEW YORK: CAMBRIDGE UNIVERSITY PRESS, 2006) 347pages, Osgood Hall Law Journal.

pollution-prevention measures. Due diligence, is recognized by the "Draft Articles on Prevention of Transboundary Harm from Hazardous Activities" as the requisite level of intent needed to establish the liability of transboundary polluters. Part One closes with an account of a new dispute over pollution by the Trail Smelter - the United States Environmental Protection Agency (EPA) has recently issued a regulatory order under the Comprehensive Environmental Response, Compensation and Liability Act (CERCLA) against Cominco relating to pollution of the Columbia River "watershed." An action to enforce the order is pending in United States Courts. The regulatory character of this action, and the attempt by the United States to directly regulate a foreign entity under a "strict liability" theory of accountability, demonstrates a drastic break in the character of modern transboundary pollution disputes.'10

‘Part Two examines the significance and potential relevance of the Trail Smelter principles to important "contemporary" issues in transboundary environmental harm. The issues surveyed include genetically modified organisms, nuclear energy, global climate change, hazardous waste transport, transboundary air pollution, and marine pollution, among others. The difficulty of identifying any particular polluting entity as the single cause of global pollution problems, like climate change cannot be identified. The requirement of "clear and convincing evidence" of "serious" environmental harm makes liability increasingly difficult to establish, and bilateral litigation becomes less effective in solving widespread pollution problems. States still reign supreme even in such international regulatory regimes, as conventions generally depend upon state cooperation and often are more concerned with preserving the sovereign equality of states

than preventing pollution. One other key theme in Part Two is a recognition of the fact that although Canada voluntarily assumed responsibility for the actions of a private company in the Trail Smelter arbitration, such attributions of control are more problematic.'11

10. Lisa Gouldy, Transboundary Harm in International Law: Lessons from the Trail Smelter Arbitration. Edited by Rebecca M. Bratspies and Russell A. Miller. New York, New York: Cambridge University Press, 2006. Pp. xxi, 347. New York University Journal of International Law and Politics, Winter, 2006. 2.

11. Ibid pg 2.

‘Part Three innovatively examines the applicability of Trail Smelter to non-environmental forms of "transboundary harm" as broadly defined, including terrorism, refugee flows, Internet torts, drug trafficking, and human rights. Generally, such analyses find that Trail's lessons are not easily transposed to other sorts of transboundary harm. First, "liability regimes" imposing damages for continuing harms are not always appropriate to remedy non-environmental harms. In the cases of migration of refugees forcing the state from which the harm emanated to compensate other states for the harm engendered will not generally resolve the problem because the harms tend to arise from instability, poverty, or weak governments within those states. Not only will those states generally have little money to satisfy any potential judgment, but any such judgment could only serve to further destabilize the state and increase the harm.

In other situations, the intense focus of Trail Smelter on theories of sovereign equality makes it less well suited to address harms caused by private actors. For example, with respect to Internet torts or terrorism, states may not be well placed to prevent the commission of such harms by private actors. In addition, multinational corporations often operate across many different states, making it difficult to hold any one state responsible for their harmful actions. Rather, multinational corporations often have better resources and scientific knowledge to regulate their own actions in ways consistent with notions of "corporate social and environmental responsibility" and therefore states must work together with those corporations in that regard. Finally, the Trail Smelter remains relevant insofar as it would counsel that states be held responsible for their own extraterritorial actions which result in human rights violations abroad.'12

After the issue of the transboundary harm we can come up to the general principles which have been evolved from this case and its implications.

Only two General Principles have been evolved from the case of Smelter. ‘The first and more general one is that enjoying every State not to allow its territory to be used in such a way as to damage the environment of other States or of areas beyond the limits of national jurisdiction. This principle was first set out by the Arbitral Courts in the Smelter

12. Ibid pg 2.

case. This principle is substantially based on an even more general obligation, enunciated in the Corfu Channel13 case where the principle laid down that every State is under the obligation not to allow knowingly its territory to be used for acts contrary to the rights of the other States.'14

‘The second general principle attested to by the general and increasing concern of the States about the environment and born out by the great number of treaties concluded that imposing upon States the obligation to co-operate for the protection of the environment. This principle had already been eluded in the decision of the Smelter case. It is off course much looser than the previous one but already reflects a new approach to environmental issues, based on the assumption that the environment is a matter of general concern. It follows from this principle that every State must co-operate for the protection of this precious asset, regardless of whether or not its own environment has been or may be harmed. This principle can only be applied jointly with the customary rule on good faith, which states every State must in good faith endeavor to co-operate with other States with a view to protecting the environment. A blunt refusal to co-operate, unaccompanied by a statement of he reasons for such attitude, would amount to a breach of the principle.'15 After dealing with issues of transboundary harm and general principles applicable in this case we have to give the answers to the questions that has come up in this case relating to whether the Canadian smelter should be required to refrain from causing damage in the State of Washington in the future, and what measures or regime, if any, should be adopted or maintained by the smelter, in addition to future "indemnity or compensation."

‘The tribunal first concluded that there was no need to chose between the law of the United States or international law to decide the case, as the law followed in the United States in dealing with the quasi-sovereign rights of the States of the Union, in the matter

13. ICJ Reports, 1949;16 ILR

14. Supra note 2. pg 488

15.Ibid pg.489.

of transboundary pollution, is in conformity with the general rules of international law. The tribunal cited a leading international law authority: "As Professor Eagleton puts in ... 'A State owes at all times a duty to protect other States against injurious acts by individuals from within its jurisdiction.'"16The tribunal supplemented this general rule with a comprehensive summary of the United States Supreme Court's decisions regarding interstate transboundary pollution, including cases both between two sovereign states and between a state and local governments or private parties (such as cities and mining companies). Taking the decisions as a whole, the tribunal stated the following principles for transboundary pollution disputes:

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 cause is of serious consequence and the injury is established by clear and convincing evidence.

The tribunal further held that the “Dominion of Canada is responsible in international law for the conduct of the Trail Smelter. Therefore, it is the duty of the Government of the Dominion of

Canada to see to it that this conduct should be in conformity with the obligation of the Dominion under international law as herein determined”.17

Applying these principles to the dispute at hand, the tribunal required the Trail Smelter to "refrain from causing any damage through fumes in the State of Washington."18 The tribunal specifically noted that such damage would be actionable under United States law in a suit between private individuals. Further, the tribunal ordered a detailed management regime and regulations for the smelter to prevent sulphur dioxide emissions from reaching levels that cause property damage in Washington State. The tribunal also indicated that it would allow future claims for damages that occur, despite the imposed management regime.'19

16. CONVENTION FOR SETTLEMENT OF DIFFICULTIES ARISING FROM OPERATION OF SMELTER AT TRAIL, B.C. U.S. Treaty series No. 893. Art XII

17. Ibid Art XII last Para

18. answer to the question of refraining of the Canadian smelter

19. Supra note 4 pg 6

‘The emergence of the Trail smelter dispute raises significant questions about the ability of Canada and the United States to resolve transboundary pollution disagreements:

* Should U.S. domestic environmental laws be applied and enforced extraterritorially against Canadian companies that operate exclusively in Canada?

* What international legal mechanisms exist to resolve transboundary water pollution disputes between the United States and Canada satisfactorily and effectively?

* What lessons may be drawn from the original Trail Smelter Arbitration decided over sixty years ago?

Answers to these questions are important, for the Trail smelter dispute which does not stand alone. The United States has numerous other environmental disputes along the Canadian border that are either ongoing or are in the making, and the number of disputes is expected to grow. Accordingly, the countries need an effective means to resolve their transboundary pollution problems.

This Article discusses some of the legal mechanisms available to resolve transboundary water pollution disputes between the United States and Canada, as viewed through the context of the Trail smelter dispute. This Article concludes that the use of international arbitration provides an effective, and too often overlooked, way to resolve transboundary water pollution issues.20 Part I describes the current Trail smelter dispute, and the unique environmental problems the Trail smelter is believed to have caused to the Upper Columbia River Basin. Part II analyzes the legal obstacles facing the U.S. Environmental Protection Agency and others wishing to use domestic environmental laws to hold Canadian companies liable for transboundary pollution. Although the

United States may be successful in its attempt to hold Canadian polluters liable through EPA initiated U.S. domestic litigation, extraterritorial application of U.S. environmental law creates significant problems, and seriously encroaches upon Canadian sovereignty. Ultimately, the national adjudication of cross-border disputes does not provide a long-term solution to transboundary pollution. Part III explores an available,

20. Shaw M.N., International Law, Cambridge University Press, 4th edition, 1997, U.K., 595

underutilized international environmental law mechanism that the countries could potentially use to effectively resolve the Trail smelter and similar disputes. To the extent that Canada and the United States attempt to resolve disputes legally, rather than through diplomatic negotiation, the best legal solution to those disputes may lie in international arbitration. International arbitration, modeled after the famous Trail Smelter Arbitration, provides both a more diplomatically and conceptually satisfying means of solving transboundary water pollution disputes than national adjudication. Indeed, despite its contentiousness, the Trail smelter dispute provides a unique opportunity to set the stage for renewed environmental cooperation between the United States and its northern neighbor.'21

CONCLUSION:-

In this case Canada was held liable to the United States for the damages and injuries done by fumes carried by the winds from a privately owned company of smelter in Canada and was required to prevent such damages in future. The tribunal found it unnecessary to decide whether the question should be answered on the basis of United States Law or the International Law, since the law followed between the states of the United States in the manner of air pollution, is in conformity with the general rules of International law. Pointing to the absence of international decisions dealing with air pollution, the tribunal said, “The nearest analogy is that of water pollution”, but again found no interrelation decisions. On both air and water pollution, the tribunal found certain United States Supreme Court decisions which may be legitimately taken as a guide in this field of international law, for it is reasonable to follow by analogy, in international cases, precedent established by that court in dealing with controversies between the States of the Union or with other controversies concerning the quasi-sovereign rights of that states, where no contrary rule prevails in international law and no reason for rejecting such precedents can be adduced from the limitations of sovereignty

21. Austen L. Parrish, TRAIL SMELTER DEJA VU: EXTRATERRITORIALITY, INTERNATIONAL ENVIRONMENTAL LAW, AND THE SEARCH FOR SOLUTIONS TO CANADIAN-U.S. TRANSBOUNDARY WATER POLLUTION DISPUTES, Boston University Law Review, 2005, April. 2, 3.

inherent in the Constitution of the United States. The tribunal referred to one Swiss case, on water pollution, Georgia vs Tennessee Copper Co.22 It concluded that

under the principles of international law, as well as the law of the United States, 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 consequences and the injury is established by clear and convincing evidence.'23

‘Considering the circumstances of the case, the Tribunal held that the Dominion of Canada is responsible by international law for the conduct of the Trail Smelter. Apart from the undertakings of the Convention, it is therefore the duty of the Government of the Dominion of Canada to see to it that this conduct should be in conformity with the obligation of the Dominion under international law as herein determined.

Therefore, so long as the present conditions in the Columbia River Valley prevail, the Trail Smelter shall be required to refrain from causing any damage through fumes in the State of Washington; the damage herein referred to and its extent being such as would be recoverable under the decisions of the courts of the United States in suits between private individuals. The indemnity for such damage should be fixed in such a manner as the Governments should agree upon.'24

‘The Trail Smelter arbitration also remains a historical anomaly; as such a dispute would likely be addressed through domestic litigation. With liberalization of jurisdictional rules in both countries and the growth of environmental enforcement opportunities under domestic law, citizens no longer need to rely on their federal

22. 206 U S 230 (1907)

23. William W. Bishop, International Law cases and Materials, Little Brown & Company, 1971, Canada, 399

24. http://www.unescap.org/DRPAD/VC/document/compendium/int7.htm

governments to seek a remedy for transboundary pollution. In fact, when citizens recently sought to remedy transboundary water pollution from the same Trail Smelter facility at issue in the original arbitration, they sued the company in United States federal court under United States domestic environmental law.'25

25. Supra note 4 pg 13.

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Trail Smelter disputeFrom Wikipedia, the free encyclopedia

Trail Smelter in 1929

The 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 polluter pays principle in the environmental law of transboundary pollution.

The smelter in Trail, British Columbia is operated by the Consolidated Mining and Smelting Company (COMINCO) and has processed lead and zinc since 1896. Smoke from the smelter caused damage to forests and crops in the surrounding area and also across the Canada–US border in Washington. The smoke from the smelter distressed residents, resulting in complaints to COMINCO and demands for compensation. The dispute between the smelter operators and affected landowners could not be resolved, resulting in the case being sent to an arbitration tribunal. Negotiation and resulting litigation and arbitration was settled in 1941.[1]

Historical context

The Trail Smelter is located in Trail, British Columbia in the south-eastern corner of the Kootenays, which is known as a mineral-rich area. The smelter was initially built by American mining engineer and magnate F. Augustus Heinze in 1895 to treat lead and zinc ore materials from nearby mines.[2] Prior to building the smelter, agents for Heinze signed a contract guaranteeing 75,000 tons of ore would be provided by Rossland's LeRoi Mining Company.[2] The smelter and the freight railway to the Rossland mines were bought by the Canadian Pacific Railway (CPR) for $1,000,000 in 1898, when tracks were being laid into the town and during the construction of a competing smelter in nearby Northport, Washington State.[2] 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.[2] 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.[3] When completed in 1895, the smelter could process 250 tons of ore daily and had smoke stacks 150 feet high to help disperse the fumes.[2] 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.'"[4] 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."[5] 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.[2][6] No government regulations of the smelter's output were imposed on COMINCO following the 1924 decision.[6]

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.[6] The initial solution involved increasing the height of the smoke stacks 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 neighbours.[6]

Dispute details

Major players

Smelter Management, 1928

The major players of the Trial Smelter dispute were the owners of the smelter, the Consolidated Mining and Smelting Company of Canada (COMINCO), and the American residents (mostly farmers and landowners who were affected by the smoke generated from the smelter). The farmers and landowners in Washington who had a mutual concern for the smoke drifting from the smelter, formed the Citizens' Protective Association (CPA) when their direct complaints to COMINCO were not addressed.[6][6] Initially the regional governments became involved, both the province of British Columbia and Washington State, but eventually the two federal governments took leadership roles in the dispute because of the issue of national boundaries and extraterritoriality.[6] Both governments were initially involved in the foundation of the

International Joint Commission (IJC) in 1909, which was later responsible for investigating and then recommending a settlement for the alleged damages in the Trail case.[6] The transformation of the smelter dispute into a foreign policy issue resulted in more institutions joining the dispute. This included the Canada's National Research Council (NRC) and the American Smelting and Refining Company, which each contributed scientific experts to assess the damages from the smelter's smoke.[6]

Alleged damages

A growing concern in 1925 was the smoke drifting from the smelter across the border into Washington, allegedly causing damages to crops and forests.[6] The smoke generated from the smelter became the source of complaints from American residents. Complaints included: sulphur dioxide gases in the form of smoke generated from the smelter was directed into the Columbia River Valley by prevailing winds, scorching crops and accelerating forest loss.[7] Effects of the smoke, as investigated by the US Department of Agriculture, included both "visible damage" in terms of "burned leaves and declining soil productivity" and "invisible damage" which consisted of "stunted growth and lower food value" for the crops.[6]

Initial efforts to resolve

After the complaints in 1925 regarding crop and forest destruction as a result of smoke from the smelter, COMINCO accepted responsibility and offered to compensate the farmers who were affected.[6] COMINCO also proposed installing fume-controlling technologies to limit future damage and reduce the emissions of sulphur dioxide. The company had initially raised smoke stacks to four hundred feet in an effort to increase the dispersion of pollutants; however, this had resulted in prevailing winds moving the noxious fumes downwind to the inhabitants of the Columbia River Valley, thereby making the situation worse.[6] The company also tried to offer payments to the affected residents or even offered to purchase the land outright, which some would have accepted. However, the company was denied this method of compensation because of Washington State's prohibition of property ownership by foreigners.[6] This led to the official petition by the farmers and landowners of Washington in 1927 for state and federal support against the smelter, claiming the smoke was damaging United States lands.[6] In 1931, the IJC awarded the farmers $350,000 in damages, but did not set guidelines for sulphur dioxide emission reduction.[6] The compensation was far less than the plaintiffs had expected and the IJC settlement was eventually rejected under the pressure of Washington's State Congressional Delegation. The unsatisfactory result of the IJC decision led to the establishment of a three-person Arbitral Tribunal to resolve the dispute in 1935.

Arbitration details

The arbitration case was originally between the farmers in the affected area and COMINCO; however, what started off as the smelter versus agriculturalists evolved when regional and federal agents became involved, resulting in the dispute becoming an international issue.[6]

Both sides employed a variety of experts to represent their interests,including scientists and private or public enterprises. The United States used the U.S. State Department along with

scientists from the Department of Agriculture to conduct investigations about the effects of the smelter's output on agriculture in the region.[8] The Canadian side turned to Canada’s National Research Council (NRC) and was granted access to the Salt Lake Research Station to conduct research for the smelter's defence.[9] These experts would remain active actors throughout the dispute. The decision laid down by the IJC awarded the farmers $350,000 in 1931 for the damages incurred by the Trail Smelter; this was much less than the farmers had sought.[10] Additionally, this was the first time the IJC ruled on a trans-boundary air pollution case.[6] The U.S. State Department flatly rejected the decision and submitted for arbitration. This resulted in diplomatic maneuvering which led to an Arbitral Tribunal; it was the Tribunal’s decision that produced the most significant results in the dispute.

Tribunal

It was not until 1935 that a Convention was signed in Ottawa, Canada that legitimized the Tribunal.[11] The Convention outlined 11 Articles under which the Tribunal would operate. Of the 11 articles, Article 3 outlines the four questions the Tribunal was to answer.

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?

2. In the event of the answer to the first part of the preceding question being is positive, to what extent should there be compensation?

3. In 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 because of any decision or decisions rendered by the Tribunal pursuant to the next two preceding questions? [6]

The American lawyers’ argument can be summarized as trying to prove that “invisible injury” occurred in the region. Large sums of money rested on the results of this case as the decision would affect various other smelting projects across North America; as such, the lawyers representing Cominco successfully limited the definition of damage to the actual, observable, economic damage.[6] Lawyers on both sides were well practiced with substantial experience. R.C. “Judge” Crowe, VP of Cominco and a Montreal Corporate Lawyer, and John E. Read represented Cominco. The U.S. hired Jacob G. Metzger, a State Department attorney with experience in negotiating international claims.[6] Metzger had a habit of not writing his arguments down, and when he died in 1937 the American scientists and lawyers went into the hearing unprepared.[6]

The United States had conducted experiments that suggested sulphur soaked into the soil; however, the findings had limited standing in the arbitration because the data was from the early 1930s before the smelter implemented chemical recovery methods.[6] On the other hand, the Canadians had the resources and the smelting industry supporting them. The experimental data the American lawyers presented to the tribunal did not convince the arbitrators of “invisible injury” theory.

Because of the Canadian lawyers' success in narrowing the definition to the actual, observable, economic damage, the arbitrators awarded $78,000 in damages for 2 burns causing visible damage in 1934 and 1936. The final settlement for damages was awarded in April 1938 and was

considered a victory for COMINCO.[6] When weighed against the backbone of the Trail economy, as well as the smelter's contributions to the war effort, the economic contributions of small-scale famers in a less fertile agricultural area were minimal.[6][12]

Reparations

The consequences of the arbitration came in two parts; one being economic compensation for the local farmers of Steven's County, Washington and two effecting laws for transboundary air pollution issues. Transboundary issues meaning those that stretch between states and nations.

COMINCO initially agreed to pay $350,000 in compensation to the local farmers for all damages before January 1, 1932.[13] However, this offer was rejected by the local residents and farmers, and the Washington government thus resulting in the arbitration. The arbiters final decisions were based on evidence for visible injury to the farmers livelihood, the US' case was poorly presented thus the tribunal's final decision in 1941 granted an additional $78,000 to the farmers and also imposed COMINCO's duty of regulating the smoke output.[14]

The arbitration successfully imposed state responsibility for transnational air pollution. This set precedence for no states being able to use their territories in such a way that would cause harm by air pollution to another territory.[15] It was COMINCO's responsibility to regulate and control the pollution their smelting industries created. As a result, the state enforced regulatory rules on corporations to limit damaging emissions. For COMINCO, their company being subject to emission standards meant potentially limiting the output of their smelter. For the better part of twenty years the company fought every attempt to impose any sort of regulatory regime aimed at production levels.[16] Only after they learned that they could recycle sulfur dioxide to make fertilizer did they finally consent to emission standards.[17]

The arbitration was significant because it defined the limits of environmentally permissible conduct between international boundaries: nations must not perpetrate significant harm to other nations through pollution.

Precedents and long-term legacies

Transboundary international law precedents

Prior to the decision made by the Arbitral Tribunal on Trail, disputes over air pollution between two countries had never been settled through arbitration, and the polluter pays principle had never been applied in an international context.[18] When the Tribunal dealt with the details of the Trail Smelter Arbitration, there was no existing international law that dealt with air pollution;[19] therefore, a law dealing with international air pollution was modelled after U.S. state laws, with the Tribunal referring to a number of cases in the U.S. that involved air pollution between multiple states.[20]

During the Tribunal's decision-making, there was also confusion between defining 'damage' versus 'damages' when it came time to decide on an outcome; the Tribunal took 'damage' to mean 'damages' as in the monetary value lost by smoke pollution instead of as direct damage to the

land.[21] Because of this, Canada's responsibility for the conduct of the smelter became making sure that the smelter did not cause any more smoke 'damage' to U.S. soil. The American inter-state law precedent caused a stir again in 2003 when the Colville Confederated Tribes launched a complaint against COMINCO for polluting Lake Roosevelt. Douglas Horswill, Senior Vice President for Teck Resources, stated that "in the U.S. legal process...Teck COMINCO would not be able to use the fact that it was operating with valid permits in its defence [because it is a Canadian company], whereas a U.S. company could";[22] Horswill's media statement reflects the tensions created by formulating an international law based on American inter-state practices.

When the International Law Commission (ILC) "adopted a series of Draft Articles on Prevention of Transboundary Harm from Hazardous Activities",[23] a fundamental problem was in defining nations as states, which was the result of applying the existing U.S. model of inter-state environmental laws to an international conflict. The Draft Articles contained a collection of provisions that focused on six points:[24]

prevention of transboundary harm, cooperation to prevent significant harm and reduce risk, the exercise of regulatory control by states of activities on their territory through prior

authorizations, environmental impact assessment, notification, and consultation

Since polluting nations were to be held responsible for harms caused to another nation's environment, this was not applicable in the arbitration because the players involved were sub-groups of each nation's population and the populus that was most affected were not the sovereign states but the sub-groups. Although Canada accepted responsibility for the actions of the smelting plant, conflict resolution put the onus on Canada to compensate for COMINCO's past pollution rather than forcing COMINCO to prevent future harm to U.S. soil. The legacy of this decision includes the eventual creation of regulatory regimes to prevent environmental degradation, which allow nations to put states in charge of taking positive steps to control pollution. The failure by states to meet these responsibilities means they are breaching international law.[25]

Some scholars do not see the case as setting a precedent because the unique circumstances surrounding the Trail smelter have been articulated and discussed multiple times, therefore the arguments that arise for transboundary international law are divorced from the context they are derived from;[26] this distorts the decisions made in cases like the Trail Arbitration. For the arbitration, the decisions that appear to be the focus of literature on transboundary international law precedents are sub-articles 2 and 4 from Article 3 of the International Joint Commission's (IJC) recommendations.[27]