January 13, 2006
Groups frothing over unclaimed bottle deposits
Pay back consumers, lawsuit demands
ROBERT MATAS
VANCOUVER -- It's only a matter of pennies for consumers at the store. You buy a drink, you pay a mandatory five-cent deposit for the bottle, 20 cents for a larger bottle.
Most of the bottles are returned for a refund, and for recycling. But about one-quarter of them never come back. So what happens to those pennies that are never reclaimed?
With one billion non-alcoholic beverages sold in British Columbia each year, the pennies quickly add up -- to millions of dollars. And the question of who is entitled to the unclaimed money is now the subject of a multimillion-dollar lawsuit before the B.C. Supreme Court.
A four-day court case begins Tuesday on whether the Consumers Association of Canada can proceed with its application for a class-action suit seeking $130-million from unredeemed deposits and what it alleges is the unauthorized collection of recycling fees.
The consumers group says the unredeemed deposits should be put into a trust fund and the only use of the money would be to pay back consumers.
The group claims that beverage manufacturers and distributors were required to pay for recycling containers under a polluter-pay principle, which was to be at no cost to consumers. However, the companies are using the unredeemed deposits and an additional recycling fee to pay for the program, the association says.
The recycling company Encorp Pacific (Canada) and 28 other companies involved in the provincial recycling program intend to ask the court on Tuesday to have the lawsuit dismissed before it is formally heard.
The B.C. government never intended to set up a trust and nothing in legislation or regulation restricts the use of the unredeemed deposits or prohibits the collection of a container-recycling fee, briefing documents prepared for the court case say.
The government has twice approved Encorp's plan for using the unredeemed deposits and paying for the recycling program, the documents say.
Encorp president Neil Hastie said in an interview that the recycling company is doing what the government wants it to do. "[The government] approved us to do it and the results we are getting are very, very good," he said.
"We think we are operating under a [provincial government] statute and the statute is clear. . . . What we are doing is exactly what the statute says."
The B.C. recycling program has some of the best results in North America, he noted. About 65 per cent of beverage containers were returned in 1997, the program's first year. The rate of return increased steadily, reaching 75 per cent by last year.
Mr. Hastie said he believes the government intended those who recycle to benefit from those who choose to not return their containers. "If you don't bring it back, then that nickel is used to offset the costs to run the system," he said.
The program has created jobs for 1,000 people, Mr. Hastie also said.
As for the activities of so-called dumpster divers in Vancouver's Downtown Eastside, who retrieve containers from bins in back lanes and return them to make money, Mr. Hastie said they have attracted considerable attention but they account for less than one per cent of returned containers. The vast majority come from consumers who take them back to the store.
The program is also an environmental success. Recycling glass and aluminum has kept 75,000 metric tonnes of material out of dumps, he said.
Encorp receives revenues from selling the glass and aluminum that offset the costs of recycling, Mr. Hastie added. But the revenues from the scrap and from unredeemed deposits are not always sufficient. The additional recycling fee is required to cover the costs, he said.
