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Lawsuit alleges government coverup of dam built illegally by Gaglardi in 1960s

The property sits near a concrete dam installed hastily, illegally and incorrectly by then-Highways Minister Phil Gaglardi in 1967.

A Kamloops-area man is suing the provincial government, alleging a “profoundly reprehensible” coverup of an illegal dam built more than 50 years ago and a shady attempt to stick him with the bill to fix it.

Larry Penner has filed a lawsuit in B.C. Supreme Court seeking aggravated and punitive damages from Victoria over its handling of an illegal dam on Cherry Creek near Tobiano.

Penner owns a 25-acre property on Cherry Creek between the Trans-Canada Highway and Kamloops Lake.

The property sits near a concrete dam installed hastily, illegally and incorrectly by then-Highways Minister Phil Gaglardi in 1967. Penner is a licensee on a small water works in the area that draws from Cherry Creek.

According to a notice of civil claim filed last week in B.C. Supreme Court, Penner was contacted in 2018 by a representative of B.C.’s Ministry of Forests, Lands and Natural Resources and told the dam was in need of immediate maintenance. As a licensee, he was told he was on the hook for the work and would be responsible for any damage caused by the dam’s failure.

Jeff Frame, Penner’s lawyer, said the province claimed to know nothing about the dam’s history.

A government coverup?

When Penner began to investigate the history of the structure, Frame said, all he could find was old newspaper clippings about a scandal in which Gaglardi used government materials and labour to construct the dam. He filed an FOI request in September of 2020 in an attempt to learn more about the dam.

“The province spent six months asking for extension after extension, and then they say, ‘We can’t give you any of the documents because the matter is under investigation,’” Frame told Castanet Kamloops.

“In the meantime, Mr. Penner gets charged [under the Water Sustainability Act] for failing to follow the order to hire an engineering firm, get a report done and get the dam fixed.”

Even then, the government refused to hand over the documents, still citing an ongoing investigation. Frame said he only got his hands on the government’s file on the dam last October — more than two years after the initial FOI request — as part of Crown disclosure, reluctantly, in Penner’s prosecution.

Dam deemed hazardous, then left alone

Frame said the documents laid out a troubling history. He said they show Gaglardi built the dam illegally and backward in 1967, and that the province was well aware of the potential hazards posed by the faulty structure almost immediately.

An engineering report dated March 7, 1968, describes the dam as “inadequate” and “a hazard.”

According to the documents, the government engineer who authored the report ordered that the dam be rebuilt and said he would otherwise order its removal. He also ordered that the dam’s sluice gate be kept fully open in the meantime to stop it from storing water.

A few months later, in June of 1968, the comptroller of water rights overrode the engineer’s report. According to Penner’s notice of claim, documents show the official rescinded the engineer’s orders on the grounds that any failure of the dam would likely not pose a hazard to the Canadian Pacific Rail tracks downstream.

And that’s how it remained, according to Penner’s suit, with each subsequent landowner in the area unknowingly responsible for the illegal structure.

Shady history 'swept under rug'

“We were shocked to find out the whole story about how Gaglardi built it illegally and it’s deficient in its construction and design, and that it was all just washed over by the comptroller of water rights,” Frame said.

“So now you’ve got private citizens who have no idea about the history of this dam, because the government buried the document, and now the government wants these people to pay to investigate what they — the government — didn’t investigate in the ‘60s, and what Gaglardi didn’t fix in the ‘60s.”

Frame compared it to someone knowingly selling a car that wasn’t just a lemon, but was dangerous.

“Why is the province allowed to do this?” he said.

“How is the province allowed to watch a senior government official illegally build a dam that is considered unsafe, hide all that and sweep it under the rug, transfer legal responsibility to unsuspecting members of the public and then have the audacity to turn around and tell these people, ‘Hey, you’ve got to investigate and fix that dam’?

“There’s something profoundly reprehensible in that.”

Guilty pleas did not end saga

Frame and a neighbour pleaded guilty in January to one count each of wilfully contravening an order under the Water Sustainability Act. As part of the plea agreement, Frame said, the men agreed to pay $2,000 fines on the understanding that the Crown would not seek an order from the court requiring that the dam be assessed and fixed.

Frame said Penner felt that was a small price to pay to put the issue behind him — but it did not stop there.

According to Frame, Penner received a voicemail on March 16 from a government official reminding him that the 2018 order is still outstanding and that the dam must be brought into compliance. The work would cost hundreds of thousands of dollars.

Penner's lawsuit was filed a week later.

“What the government should have done is said, ‘Our bad — we didn’t deal with Gaglardi at the time. This is our problem, not yours. We’re going to send in a government engineer, we’re going to look at it, we’re going to figure out what needs to be done and we’re going to do it. We’re going to clean up our own mess,’” Frame said.

“But there’s an arrogance about government thinking that they shouldn’t be held accountable for what everyone else would be.”

Frame said he is also seeking recourse through B.C.’s Office of the Information and Privacy Commissioner for the government’s “burying” of the documents.

No comment from government

Castanet Kamloops asked the Ministry of Forests, Lands and Natural Resources to respond to Penner's claims.

"As this case is currently before the courts, we cannot provide further information at this time," read a statement set by a ministry spokesman.

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