Hamilton refused to fix flooding stormwater channel for 23 years, now must pay $3M in damages

For over 23 years, the City of Hamilton refused to repair its own drainage channel even after a local company complained it flooded its property with stormwater and untreated sewage, causing millions of dollars in damages and shutting down work.

Now, taxpayers are on the hook for the city's "failure" to "undertake any maintenance of the watercourse" in Hamilton's industrial sector, said a ruling by Superior Court Justice Michael Gibson earlier this month. 

Gibson ordered the city to pay National Steel Car $3 million in damages for doing "almost nothing" to prevent the channel from flooding, while diverting an "enormous" amount of stormwater and sewage down the Kenilworth Avenue channel. 

He also ordered the city to restore the channel to working order, including clearing debris from one part that's 95 per cent blocked, acting like a "plug in a bathtub" preventing the flow of water into Hamilton Harbour.

"Without an injunction there is no doubt National will continue to sustain damages from further floods," Gibson said. "Workers will be sent home and others tasked with cleaning up stormwater and sewage in dangerous conditions." 

ArcelorMittal Dofasco (AMD) was also ordered to pay roughly the same amount in damages to National Steel Car. AMD's property is across the street, along the east side of Kenilworth, and in 2008 it installed its own flood-proofing infrastructure without the city's permission, the ruling said.  

In the process, AMD blocked culverts and diverted water onto National Steel Car's property, Gibson said. Culverts are structured tunnels that allow water to pass through roads, bridges and other infrastructure.

AMD also didn't maintain the parts of the channel that run through its land, Gibson said. He noted two culverts that are 9-metres tall and are "completely submerged in polluted sediment" and only a "trickle" of water can pass through them into the harbour. 

Even though the city has the power to clear the culverts, or order AMD to do the work, it did neither, the judge said, adding that "the city has taken no steps to enforce its bylaw." 

City 'disappointed' with ruling

The city did not answer many of CBC Hamilton's questions including how much money it spent on legal fees fighting the case that National Steel Car began in 2012. 

"While the City of Hamilton respects the recent decision of the court, we are disappointed with that decision," it said in a statement Friday. 

When asked if it will appeal, the city said it is still reviewing and then will decide "next steps." 

None of AMD, National Steel Car and Mayor Andrea Horwath provided comment in time for publication. 

National Steel Car has withheld $7.1 million in property taxes, which is an unrelated legal dispute, but one that resulted in Gibson awarding less in damages for the flooding.

In their defence, the city and AMD argued that rising lake levels in Hamilton Harbour caused the flooding, said the ruling.

"Yet none of the witnesses, including the defendants' own experts, gave that evidence," said Gibson. 

"The available historical lake levels data over 52 years clearly establish that the lake has never reached a level that could top the lowest point of National's property." 

No witness provided an explanation as to why the city refused to maintain the channel, but Gibson surmised it was to save money. 

Dredging, or scraping out built-up debris from the bottom, costs about $600,000 if the material is hazardous, the ruling said. 

In advance of the trial, Gibson noted the city added the channel into its "routine maintenance program" but hasn't done the maintenance yet.  

Other sewage challenges

This is not the first time the city's paid millions of dollars for sewage issues. 

In 2023, the city paid close to $3 million in fines after 24 billion of biohazardous material spilled into Chedoke Creek. A valve in its combined sewer overflow system was left open between 2014 and 2018, causing the leak. 

Other spills were discovered last year, including that 59 million litres of sewage had flowed from 11 homes near the Sherman Access straight into Lake Ontario since 1996. 

In the case of the channel that begins on Kenilworth Avenue North, sewage and stormwater is supposed to end up in the lake when the city's overflow system is overflowing, such as during major rainstorms. 

The importance of city stormwater infrastructure was on display a few weeks ago when extreme rain fell on Toronto and parts of the GTA. Water rapidly flooded roads, highways and subway systems. 

In Burlington, Ont., homes were flooded when a nearby culvert became blocked from a partially collapsed Hwy. 407 embankment.

When asked if there's concern about the state of other channels and culverts in Hamilton, city staff said the Kenilworth Avenue "drainage issue" is an isolated incident and has only impacted National Steel Car's property. 

Robert Haller, executive director of Canadian Water and Wastewater Association, said the city has been pushing other levels of government for more infrastructure funding. 

"It's difficult to see Hamilton facing this [ruling]  when you see how much effort they've been putting into upgrading their stormwater systems, upgrading their wastewater systems," he said.