Supreme Court of Canada Dismisses Consultation and Charter Claims in Relation to Jumbo Valley Resort

Authors: Marco Baldasaro and Gavin Fitch, QC

On November 2, 2017 in Ktunaxa Nation v British Columbia (Forests, Lands and Natural Resource Operations), 2017, SCC 54, the Supreme Court of Canada dismissed an appeal by the Ktunaxa Nation (“Ktunaxa”) concerning the approval of a year-round ski resort in the Jumbo Valley near Invermere, British Columbia. The Jumbo Valley is located in the northwestern part of the Ktunaxa territory in an area the Ktunaxa call Qat’muk. The appeal raised the novel issue of whether approval of the ski resort infringed the Ktunaxa’s right to freedom of religion under the Canadian Charter of Rights and Freedoms (the “Charter”). A majority of the Supreme Court ruled that it did not.
 

Facts

The Jumbo resort was proposed by Glacier Resorts Ltd. (“Glacier Resorts”) in 1991. Early on in the consultation process, the Ktunaxa raised concerns with Glacier Resorts about the impact of the resort. The Ktunaxa asserted that Qat’muk was both ecologically sensitive and a place of spiritual significance. Consultation between the parties led to significant changes to the original resort proposal. Late in the consultation process, however, the Ktunaxa adopted a new, uncompromising position that accommodation was impossible because permanent structures would drive the Grizzly Bear spirit from Qat’muk and irrevocably impair the Ktunaxa’s religious beliefs and practices. After failed efforts to revive the consultation process and reach agreement, the Minister declared that reasonable consultation had occurred and approved the resort. 

Ktunaxa sought judicial review of the Minister’s decision before the Supreme Court of Canada on two grounds:

1. the project would violate the Ktunaxa’s freedom of religion under s. 2(a) of the Charter; and
2. the government breached the duty of consultation and accommodation imposed on the Crown by s. 35 of the Constitution Act, 1982.

Religious Freedom (Section 2(a) of the Charter)

Following earlier case law, the Court confirmed that section 2(a) of the Charter has two aspects – the freedom to hold religious beliefs and the freedom to manifest those beliefs. To establish an infringement of the right to freedom of religion, the claimant must demonstrate (1) that he or she sincerely believes in a practice or belief that has a nexus with religion, and (2) that the impugned state conduct interferes, in a manner that is non-trivial or insubstantial, with his or her ability to act in accordance with that practice or belief.

The court accepted that the Ktunaxa sincerely believe in the existence and importance of the Grizzly Bear Spirit and that permanent development in Qat’muk would drive this spirit from the Qat’muk. However, the Supreme Court refused to accept that the Minister’s approval interfered with the Ktunaxa’s ability to act in accordance with this belief. The Court noted that the appellants were not seeking protection to believe in the Grizzly Bear Spirit or to pursue practices related to it but instead, to protect Grizzly Bear Spirit itself. The court ruled that this was beyond the scope of the protection provided by section 2(a) and rejected the Ktunaxa’s argument on this point.

Consultation and Accommodation

Where a permit is sought to use or develop lands subject to an unproven Aboriginal claim, the government is required to consult with the affected Aboriginal group, and where appropriate, accommodate the group’s claim pending is final resolution. 

The extent of the Crown’s duty to consult and accommodate in the case of an unproven Aboriginal claim varies with the apparent strength of the claim and the effect the proposed development would have on the claimed Aboriginal right. A strong claim or significant impact may require deep consultation. A weak claim or transient impact may attract a lighter duty of consultation. Significantly, section 35 guarantees a process, not a particular result. There is no guarantee that the specific accommodation sought will be warranted or possible. 

The Court noted that negotiations between Glacier Resorts and the Ktunaxa had spanned two decades and found that deep consultation had taken place. Multiple changes had been made to the project to accommodate the Ktunaxa’s spiritual claims and environmental concerns. At a point when it appeared that all major issues had been resolved, the Ktunaxa adopted a new, absolute position that no accommodation was possible because permanent structures would drive the Grizzly Bear spirit from Qat’muk. The Minister attempted to consult with the Ktunaxa on the newly formulated claim, but was told that only a total rejection of the project would be satisfactory. After reviewing the evidence, the Supreme Court ruled that the Minister’s conclusion that sufficient consultation had occurred was reasonable and dismissed the appeal.

Analysis

Ktunaxa Nation confirms that while section 2(a) of the Charter protects the freedom to worship, it does not protect the spiritual focal point of worship.  In other words, section 2(a) protects the believer, not the belief. An extension of section 2(a) as requested by the Ktunaxa would theoretically have allowed them to control development on public lands according to their subjective spiritual beliefs. The Supreme Court’s rejection of this interpretation certainly provides greater predictability to the law. Courts in Canada are well positioned to assess whether state conduct interferes with an individual’s ability to hold and manifest his or her belief. They are less suited to assess whether state conduct will drive a particular spirit from an area, since this would involve assessing a subjective belief.

With respect to consultation, the decision is a reminder that section 35 only guarantees a process. While the Minister did not offer the ultimate accommodation demanded by the Ktunaxa (complete rejection of the resort), the Court reiterated that section 35 guarantees a right to consultation and accommodation, not a right to particular outcome. Section 35 does not provide Aboriginal groups with veto power in relation to developments on their territories.

Though ostensibly a victory for Glacier Resorts, it remains unclear whether the construction of the resort will ultimately proceed. The provincial NDP government previously expressed, while in opposition, unequivocal hostility towards the resort. Whether the government takes steps to prevent the resort from being constructed remains to be seen. In any event, Ktunaxa Nation exemplifies the multi-pronged resistance and delay that many developments now face in an age of environmental and indigenous activism and increased regulatory scrutiny. 

Death by a Thousand Cuts: Caribou Habitat and Crown Consultation

Authors: JoAnn P. Jamieson and Sarah Levine

The Fort Nelson First Nation (“First Nation”) has filed a judicial review of a British Columbia Oil and Gas Commission (“OGC”) decision to approve a 39 kilometre gas pipeline and storage facility located in the Horn River Basin, citing an “inadequate, unlawful and wholly unacceptable approach to consultation”. The First Nation has challenged the OGC’s consultation process on the basis that the OGC refused to seriously consider and address its concerns regarding the health and abundance of the Maxhamish caribou herd and the ongoing disturbance to its habitat. The First Nation seeks to have the Court declare that the Crown failed to fulfill its legal and constitutional duty of consultation and set aside the approvals.   

The First Nation’s Concerns

The First Nation seeks to protect its treaty right to hunt boreal caribou in an area known as the “Fortune Core”. The First Nation asserts that the proposed pipeline would traverse an area where the Maxhamish boreal caribou herd frequent and would heavily impact its habitat. The First Nation’s claims regarding the condition of the Maxhamish herd include:

• a consistently decreasing population of caribou in the Maxhamish range;
• a significant disturbance level to the Maxhamish range of 74% (well past the minimum accepted threshold of 35% disturbed habitat for achieving a self-sustaining population); and
• a 3-times increase in the speed at which the caribou’s predators (mainly wolves) can travel due to linear disturbances in the natural forest- such as roads, pipeline, and seismic lines.

The First Nation contends that the OGC did not adequately consult with it regarding the proposed project and the potential impact to the herd, despite the First Nation’s extensive knowledge and connection with the caribou population in their territory.

Scope of the OGC’s Consultation

The OGC is the provincial regulator responsible for ensuring the Crown’s legal obligations to consult and accommodate are fulfilled with respect to oil and gas activities in British Columbia. The OGC opposes the relief sought by the First Nation, stating that it acted in good faith and maintained the honour of the Crown while fulfilling its obligations to consult and accommodate.

The OGC conducted its consultation with the First Nation in accordance with its Interim Consultation Procedures for Treaty 8 First Nations (the “Procedures”), which sets out the standard process and timing for the OGC’s consultation activities.  Of note is that the Procedures do allow for a customized approach to the consultation process in appropriate circumstances.

Over the course of the application process, it appears that the OGC and the First Nation exchanged several pieces of correspondence outlining their respective positions on the scope and extent of the OGC’s consultation obligations. The First Nation claims that the OGC limited the scope of the consultations to the proposed project and refused to discuss the provincial initiatives relating to the boreal caribou, the First Nation’s third party assessment or interpretations of items such as linear density and caribou population health. 

In response, the OGC asserts that it referred the First Nation to the broader consultation process on the Implementation Plan for the Ongoing Management of Boreal Caribou and repeatedly requested meetings to discuss the project and develop a project-specific consultation process, but that the First Nation did not accept these offers. Upon its review of the materials and information available to it, the OGC concluded that the proposed project would not cause a material adverse effect on the boreal caribou’s habitat or its ability to survive, and approved the project.

Implications of this Judicial Review

This case is one to watch. The issue at stake is a factual one, however it also raises the larger question of whether the OGC can adhere to its standard consultation procedures or whether, when a First Nation raises broader concerns of cumulative effects and habitat protection in the context of a specific application, it is incumbent on the OGC to respond to the full scope of issues raised.

Many will recall the British Columbia Court of Appeal’s decision in West Moberly First Nations v. British Columbia (Chief Inspector of Mines), 2011 BCCA 247 where the Court found that the Crown had failed to meaningfully consult and accommodate the West Moberly First Nation’s treaty right to hunt the Burnt Timber caribou herd. In that case, the Ministry of Energy, Mines and Petroleum Resources had authorized coal mining activities in an area of fragile caribou habitat. Specifically, the Court found that the historical context – meaning the status of the herd and condition of its habitat – was essential to a proper understanding of the seriousness of the potential impacts on the First Nation’s treaty right to hunt. The Court suggested that the cumulative effects of development can become a situation of “death by a thousand cuts”, making the potential impact of the next cut critical to an understanding of the potential impact to the First Nation’s treaty rights.   

Given the pace of oil and gas development in northeast BC, the scope of the OGC’s consultation process, and to what extent it must include the cumulative impact on a treaty right, is sure to become a key issue.

The Role of a Tribunal in Fulfilling the Duty to Consult

Author: Gavin Fitch, Q.C.

The Supreme Court of Canada (the “SCC”) recently provided welcomed guidance on the role of a tribunal in fulfilling the duty to consult with Indigenous peoples when their rights are potentially impacted by Crown action.  In the companion cases Clyde River (Hamlet) v. Petroleum Geo-Services Inc.[1] (“Clyde River”) and Chippewas of the Thames First Nation v. Enbridge Pipelines Inc.[2] (“Chippewas of the Thames”) the SCC stated clearly that the Crown’s duty must be fulfilled prior to project approval.  Where the duty remains unfulfilled, the final decision maker must withhold the approval.

The Clyde River case

Clyde River concerned an application to the NEB under the Canadian Oil and Gas Operations Act[3] (“COGOA”) for approval to conduct seismic testing off Baffin Island in Baffin Bay and Davis Strait.  The Hamlet of Clyde River (“Clyde River”) opposed the application. 

Clyde River is in Nunavut, which was established as part of the settlement of the comprehensive land claim of the Inuit of the eastern Arctic.  Accordingly, the residents of Clyde River have established treaty rights that would potentially be affected by approval of the application. 

Further, according to the SCC, there was no dispute that the seismic testing could impact those established treaty rights (for example, by increasing the mortality risk of marine mammals).  Therefore, the duty to consult owed by the Crown fell at the highest end of the spectrum (i.e., “deep consultation”).

After the application was filed, the NEB undertook an environmental assessment of the proposed project and a series of public meetings were held in various communities in Baffin Island, including Clyde River.  According to the SCC, community members asked “basic questions” about the effects of the seismic testing on marine mammals, which the proponent was unable to answer.  Instead, the proponent said the issue would be addressed in an environmental assessment (“EA”) report it was preparing and that would be filed with the NEB.

Several months later, with no additional consultation having occurred, a 3,926 page EA report was filed by the proponent.  It was posted on the NEB’s website and delivered to Clyde River’s offices.  The “vast majority” of the EA report was not translated into Inuktitut and:

“[n]o further efforts were made to determine whether this document was accessible to the communities, and whether there questions were answered.”[4]

The NEB approved the application.  Clyde River sought judicial review of the approval before the Federal Court of Appeal (“FCA”) on the basis of inadequate consultation.  The FCA found that the Crown’s duty to consult had been satisfied and dismissed the judicial review.  Clyde River appealed to the SCC.  In Clyde River, the SCC allowed the appeal, holding that the consultation carried out by the NEB on behalf of the Crown was not adequate.

Chippewas of the Thames

Chippewas of the Thames concerned Enbridge’s Line 9 applications to the NEB.  The applications were for approval of a modification of an existing pipeline that would reverse the flow of part of the pipeline, increase its capacity, and enable it to transport heavy crude oil.  The Chippewas of the Thames requested Crown consultation before the NEB approved the project; the Crown advised that it would be relying on the NEB’s public hearing process to address its duty to consult.

The Chippewas of the Thames participated in the NEB hearing process.  They applied for and received participant funding, submitted evidence (including expert evidence) and delivered oral argument at the conclusion of the hearing.  In this way, the Chippewas of the Thames communicated to the NEB their position that the project would increase the risk of pipeline ruptures and spills along Line 9 which could adversely impact their use of the land and the Thames River for traditional purposes.

The NEB approved the Line 9 application.  The Chippewas of the Thames appealed the approval to the FCA on the basis of inadequate consultation by the Crown.  The majority of the court dismissed the appeal.  The Chippewas of the Thames further appealed to the SCC.  The SCC dismissed the appeal, holding that the NEB’s hearing process, which the Chippewas of the Thames participated in fully, constituted effective consultation which discharged the Crown’s duty to consult.

Can an NEB approval process trigger the duty to consult?

In Clyde River, the SCC stated clearly that yes, the NEB’s approval process triggered the duty to consult.  Notwithstanding that the NEB is not, strictly speaking, “the Crown” nor an agent of the Crown, the NEB “acts on behalf of the Crown when making a final decision on a project application.”

Interestingly, the SCC went on to find that it “does not matter whether the final decision maker on a resource project is Cabinet or the NEB.  In either case, the decision constitutes Crown action that may trigger the duty to consult.”  Thus, the Crown may delegate the duty to consult both to regulatory agencies that have the power to make final decisions on resource projects and those that merely make recommendations to a Minister or Cabinet.

Can the Crown rely on the NEB’s process to fulfill the duty to consult?

This question had already been considered by the SCC in Rio Tinto.  What Clyde River and Chippewas of the Thames make clearer is that the duty to consult may be delegated by the Crown to a regulatory agency in whole or in part.  Further, the Crown may delegate the assessment of whether the duty to consult has, in the circumstances of the case, been fulfilled.

In Chippewas of the Thames, the majority of the FCA expressed the concern that a tribunal like the NEB might be charged with both carrying out consultation on behalf of the Crown and then adjudicating on the adequacy of those consultations.[5]  The SCC dismissed these concerns, writing:

In our view, these concerns are answered by recalling that while it is the Crown that owes a constitutional obligation to consult with potentially affected Indigenous peoples, the NEB is tasked with making legal decisions that comply with the Constitution.  When the NEB is called on to assess the adequacy of Crown consultation … its obligation to remain a neutral arbitrator does not change.  A tribunal is not compromised when it carries out functions Parliament has assigned to it under its Act and issues decisions that conform to the law and the Constitution.  Regulatory agencies often carry out different, overlapping functions without giving rise to a reasonable apprehension of bias.[6]  [emphasis added]

While it is hard to disagree with the general proposition that a regulatory agency may carry out different, overlapping functions without giving rise to a reasonable apprehension of bias, where one of those functions is to assess and adjudicate on the agency’s carrying out of another function, it is far less obvious that no apprehension of bias might occur.  The Court’s judgment will likely give rise to future cases where the ground of judicial review is that the regulatory agency’s assessment of the adequacy of consultation (as opposed to, or in addition to, the adequacy of the consultation itself) was inadequate or flawed.

What is the NEB’s role in considering Crown consultation before approval?

The SCC in Clyde River and Chippewas of the Thames was very clear:  where the Crown has delegated to a regulatory tribunal like the NEB duty to consult, the project being assessed may only be approved if Crown consultation has been adequate; otherwise, approval must be withheld or it will be quashed on judicial review.

This means that where the regulatory tribunal is the decision-maker, it must adequately consult with the relevant Indigenous peoples as part of the regulatory process before making a decision on the project. 

What about where the regulatory tribunal is not the decision-maker (i.e., the decision-maker is the Minister or Cabinet)?  

In Clyde River, the SCC noted that while the Crown may rely on steps undertaken by a regulatory agency to fulfill its duty to consult, the Crown “always holds ultimate responsibility for ensuring consultation is adequate.”[7]  Therefore:

Where the regulatory process being relied upon does not achieve adequate consultation or accommodation, the Crown must take further measures to meet its duty.  This might entail filling any gaps on a case-by-case basis or more systematically through legislative or regulatory amendments….  Or, it might require making submissions to the regulatory body, requesting reconsideration of a decision, or seeking a postponement in order to carry out further consultation in a separate process before the decision is rendered.”[8]

While “filling” gaps on a case-by-case basis might appear to be a recipe for still more regulatory delay, by adding another step in the process before approval is finally issued, in fact it is not that different from the situation today.  For example, review panels under the Canadian Environmental Assessment Act 2012 are typically used by the federal Crown to collect information on aboriginal claims and potential project impacts on those rights, but this is followed by additional consultation by the Crown on the review panel’s report before a decision is made by the Minister.

Conclusion

The outcomes in Clyde River and Chippewas of the Thames were different because the facts of the cases were different.  In Clyde River, there was no public hearing and minimal efforts made by the NEB to assess the impact of the seismic project on the rights of the Inuit (as opposed to considering the environmental effects of the project more generally).  By contrast, in Chippewas of the Thames, there was a major public hearing which the Chippewas participated in fully, in part because they were the recipient of participant funding. 

This suggests that, all else being equal, the NEB’s normal public hearing processes can effectively discharge the Crown’s duty to consult.  It is interesting to note that since the SCC rendered judgment in Clyde River and Chippewas of the Thames, the FCA has dismissed applications for leave to appeal by First Nations participants alleging inadequate consultation in two cases involving approval by the NEB of pipelines following public hearings.[9]

---

[1] 2017 SCC 40.
[2] 2017 SCC 41.
[3] R.S.C. 1985, c. O-7.
[4] Clyde River, at para. 11.
[5] Chippewas of the Thames, at para. 33.
[6] Ibid, at para. 34.
[7] Clyde River, at para. 22.
[8] Ibid.
[9] Blueberry River First Nations v. A.G. of Canada and NOVA Gas Transmission Ltd., 2015 FCA (36676) and Saulteau First Nations v. A.G. of Canada, NOVA Gas Transmission and National Energy Board, 2015 FCA (36677).

 

Geography and The Law - West Moberly First Nations v. British Columbia

Earlier this week, the Supreme Court of British Columbia released its decision in West Moberly First Nations v. British Columbia. This case was mostly about geography, not law.

Gavin Fitch, Q.C. recently wrote case comments on this particular decision for Canadian Geographic in an article titled "When geography and the law collide". To view Gavin's comments, please click here.

Gavin is Co-Chair of both the McLennan Ross Aboriginal Practice Group and the Energy, Environmental and Regulatory Practice Group.

No Interim Injunction for Cumulative Effects

Authors: JoAnn P. Jamieson and Michael Barbero

The British Columbia Supreme Court recently denied a second interim injunction application by the Blueberry River First Nations ("BRFN"), seeking to enjoin the Province from allowing further industrial development on its traditional lands in Northeast B.C. Despite finding that the BRFN is experiencing irreparable harm from the cumulative effects of industrial development on its treaty rights, the Court in Yahey v. British Columbia ultimately concluded that the balance of convenience did not favour the granting of an injunction. The cumulative effects issue is to be addressed at the trial currently scheduled for over 90 days in March of 2018.

Background
In March 2015, the BRFN filed a lawsuit alleging that the provincial Crown had infringed the BRFN’s exercise of treaty rights, specifically its’ “meaningful right to hunt in territories over which they [BRFN] had traditionally hunted, fished and trapped”. The action is premised on the Supreme Court of Canada decision in Mikisew Cree First Nation v. Canada (Minister of Canadian Heritage), where the Court found that in circumstances where the Crown has taken up so much land that no meaningful right to hunt remains, a treaty infringement could potentially be established.

The Injunction Application
In support of its application, the BRFN put forward a document entitled “Atlas of Cumulative Landscape Disturbances in the Traditional Territory of Blueberry River Frist Nation”. The Atlas purported to demonstrate cumulative effects by showing that 73% of the BRFN’s traditional territory was within 250 metres of an industrial disturbance, and 84% was within 500 metres of an industrial disturbance. In addition, the BRFN tendered evidence from its members addressing the impacts of development on the exercise of treaty rights, namely hunting and trapping.

In response, the Province put forward evidence showing that granting the injunction would have significant impact on government revenue and the regional economy in and around Fort St. John, including several letters from oil and gas and forestry companies attesting to significant, if not severe impact, on their businesses if an injunction of all further industrial activity were granted.

No Injunction
The legal test for granting an injunction has been well established by the Supreme Court of Canada in RJR-McDonald Inc. v. Attorney General (Canada). The test is two pronged. The first prong requires the applicant to satisfy the court that there is a fair question to be tried as to the existence of a right. The second prong involves a consideration of the competing interests. Here, a court is to consider the factors of irreparable harm and the balance of convenience in determining which party will suffer the greatest impact as a result of the granting or refusal of the injunction.

Applying the law, the Court concluded that the BRFN had established the existence of a right and the presence of irreparable harm on the basis of evidence demonstrating the extent of industrial activity and detrimental effects on their Treaty 8 rights. However, in the Court’s view, the BRFN had not shown that the balance of convenience favoured the granting of an injunction. The Court pointed to the following factors in support of its decision:

1. The evidence established the injunction would cause economic harm to the province through the loss of revenue, such as bonuses paid to the province, annual rent and royalties.
2. The evidence established adverse effects on third parties, namely businesses and individuals in the region already hard hit by a slowdown in economic growth.
3. The Court noted that prohibition against future development would, by default, necessarily impact current development and projects given that these projects often are only partially permitted and would require periodic renewal or ancillary permits which would be prohibited by the injunction.

Despite concluding that the BRFN had not satisfied the legal test for the granting of an injunction, the Court acknowledged the “difficult situation” within which the BRFN find themselves. The Court readily accepted that the taking up of traditional land in this area may soon reach a point of no return whereby the BRFN will have lost the ability to meaningfully exercise its rights. However, at this time, the pending risk and the merits of the Province’s existing consultation on cumulative effects frameworks could only be addressed at trial.

Implications
The decision represents an additional layer of risk for industry participants in both Northeast B.C. and beyond. The courts are clearly in tune to the fact that years of development and the resulting cumulative effects are having serious and potentially irreparable impacts on treaty rights. While the balance of convenience favoured the denial of an injunction based on the facts of this case, it is growing more likely that the cumulative impact on the treaty right to hunt, trap and fish could potentially constitute a treaty infringement and quite possibly an injunction in the right circumstance.

In Yahey, the Court encouraged the parties to pursue a collaborative path in ensuring the sufficiency of the Province’s cumulative effects measures. It is in industry’s best interest to encourage governments to enter into a meaningful dialogue with First Nations on this issue. Further, industry can and should continue to work with First Nations and other aboriginal groups to foster understanding of the cumulative effects of multi-sector development on their treaty and aboriginal rights and carve a mutually-beneficial path forward