The Saskatchewan Court of Appeal dismissed an appeal from an order of the Court of Queen’s Bench relating to the posting and sale of oil sands exploratory permits in an area covered by Treaty 10. The Court of Appeal agreed with the chambers judge that the duty to consult was not triggered in this case. The granting of exploration dispositions had no potential to impair Treaty 10 rights. The law requires a meaningful threshold for triggering the duty to consult, involving actual foreseeable adverse impacts on Aboriginal or treaty rights flowing from Crown conduct, or a direct link between possible adverse impacts and Crown conduct, and not a merely speculative impact.

In September 2012, the respondent Minister posted oil sands exploration permits for sale by sealed bid. The permits extended to lands covered by Treaty 10. In December 2012, the Minister issued two permits to Scott Land & Lease Ltd. to areas that included Treaty 10 lands.

The appellant Buffalo River Dene Nation is a successor to the Clear Lake Indian Band, a signatory of Treaty 10. The respondent Minister did not consult with the appellant prior to the posting of the permits for sale in September 2012, or the issuance of the permits in December 2012. The appellant subsequently filed an application for judicial review of these decisions.

The Court of Queen’s Bench dismissed the judicial review application on the basis that the duty to consult was not triggered by the posting of the permits. Pursuant to Saskatchewan’s Crown Minerals Act, the type of permit issued to Scott Land & Lease does not authorize the permit holder to actually go onto the land and do anything. Further authorizations are needed to engage in physical exploration work. The duty to consult was not triggered because the Minister did not make a decision that could affect the use of the land.

The chambers judge rejected the argument that the Crown decision was the type of “strategic high-level” planning decision discussed in the Haida Nation case. The decision was made at the administrative level, not the Ministerial level, and involved no planning. When the Ministry receives a request to post permits in certain areas, a decision will be made to post permits for sale. No planning is involved in the decision.

The permit holder would need an authorization from the provincial Ministry of Environment before conducting any physical activities on the land. The decision of this Ministry is made without reference or regard to the existence of an exploratory permit issued by the respondent Minister. Currie J. held that the issuance of an exploratory permit does not bind the Ministry of Environment when considering whether to issue a further authorization. The duty to consult “may well be engaged” at that stage.

The decision of Mr. Justice Currie on 6 March 2014, indexed as 2014 SKQB 69, was summarized in our e-Newsletter of 13 August 2014.

The Saskatchewan Court of Appeal dismissed the appeal brought by the Buffalo River Dene Nation.

Evidence about the rights afforded by Treaty 10, and the use of the permit area by members of the Buffalo River DN, was reviewed at length. The Crown’s decision to allow oil sands exploration in the area, as opposed to localized resource development such as small-scale logging, was of great concern to the appellants due to its potential to negatively impact a very broad area. The appellant also submitted that it had little capacity or funding to participate in meaningful consultation.

The Court of Appeal reviewed the process of offering for public sale and granting exploration permits. Section 19 of The Crown Minerals Act provides that no Crown disposition shall authorize any person to enter on or use the surface of the Crown mineral lands. Caldwell J.A. summarized:

The granting of an Exploration Permit [first-stage] thus affords the Permit-Holder with exclusive subsurface rights in a specified area and exclusive mineral exploration rights with respect thereto, but does not grant the Permit-Holder any right to access the surface of the Disposition Lands or to extract oil sands or other minerals therefrom. To do this, the Permit-Holder must separately obtain surface access rights from the Environment Ministry [second-stage] and, if same are granted and the Permit-Holder’s exploration proves a commercially-viable mineral, the Permit-Holder must subsequently obtain a lease from the Energy Ministry [third-stage] before the Permit-Holder may begin to actually extract the mineral discovered.

The Crown argued that no duty to consult is triggered by the issuance of an Exploration Permit, but would be triggered at the second stage if the permit holder applies to the Environment Ministry for surface access.

The standard of review in appeals of this nature was described in Haida Nation, and explained further in later court decisions. Since this case was determined on largely uncontested facts, the standard applicable to an appellate review of the Court of Queen’s Bench decision is correctness.

The Court of Appeal held that the chambers judge was correct in finding that the Crown decision did not have the potential to adversely impact the Treaty 10 rights of the appellant, and the Crown’s duty to consult was therefore not triggered. The duty to consult arises whenever the assertion of Crown sovereignty comes into conflict with the existence of Aboriginal peoples on the land. Where the potential for such conflict exists, the duty to consult is triggered. A three part test was described in Rio Tinto: (1) the Crown’s knowledge of a potential Aboriginal claim or right; (2) contemplated Crown conduct; and (3) the potential that the contemplated conduct may adversely affect an Aboriginal claim or interest. It is only the third criterion that is in issue in this case. However, it was important to delineate precisely what the first two elements entail to assess the potential for an adverse impact.

Caldwell J.A. thoroughly reviewed the jurisprudence from across Canada on how the “adverse impact” element of the test has been applied. There was no case precisely on point although in two factually similar cases –Athabasca Chipewyan First Nation v. Alberta, 2011 ABCA 29 and Dene Tha’ First Nation v. Canada, 2013 BCSC 977 – the court assumed that the duty had been triggered. He concluded:

I find the Chambers judge correctly concluded there was “no obvious and immediate physical impact” arising from the impugned Crown conduct in this case. While a factual conclusion, it is largely underpinned by an interpretation of the regulatory scheme and Crown policy. And, in my assessment, the legislation, the Regulations, the Consultation Policies, and the affidavit evidence of both parties make it clear that, on its own, the Crown’s first-stage decision to issue the Scott Permits does not directly or indirectly impact the Permit Land or treaty rights under Treaty 10 and, therefore, the duty to consult did not arise on the evidence before the Court. … [italics in original]

Caldwell J.A. expanded upon this conclusion by listing various reasons to support it:

  1. The appellant may be concerned about the adverse impacts of oil sands exploration, but there is no suggestion that they are concerned with the potential impact of the mere sale of mineral rights. There is merit in the suggestion that a permit-by-permit approach to consultation would result in “death by a thousand cuts”, and the broader effects of Crown conduct should be considered; however, a permit-by-permit approach may be impractical and unworkable. In this case, there is a well-defined and linear regulatory process that expressly contemplates consultation at the second and later stages. Issuing the Exploration Permit has no meaningful impact on treaty rights. There is no conflict between the Crown’s assertion of sovereignty over the land and the existence of Aboriginal peoples on the land. The Crown conduct of posting and issuing Exploration Permits will not have an appreciable or current impact on Treaty 10 rights.
  2. The duty to consult may be triggered at a low threshold, but it must remain a meaningful threshold. There has to be something for the Crown and the Aboriginal group to consult about. It makes little sense to consult if there is nothing to reconcile. The judicial review application was premature in that there is no evidence to show a causal relationship between the issuance of the permits and the speculative future adverse impacts of oil sands exploration. Again, the issuance of the permits does not give Scott Lease & Land any right to enter the lands. There is no fundamental shift in the management of a resource, and the Crown has not ceded control over any resources.  It would be a great waste of time and resources to require the Crown to sit down with the appellant to consult about something that is “so terribly contingent and unquantifiable”.
  3. If any actual, non-speculative potential impact on the appellant’s Treaty 10 rights should arise in the future, the appellant will have ample opportunity to address that in consultation.
  4. There was no error in the Chambers judge’s conclusion that the impugned Crown conduct was not the type of “strategic, higher level decision” contemplated in Haida Nation. The chambers judge, however, did err in his interpretation of the meaning of “strategic, higher level decisions” by focussing on the identity or administrative level of the Crown agent who made the decision. Caldwell J.A. held that, in this case, it is not possible to characterize the posting and issuing of the permits in this case as some kind of appreciable, non-speculative “strategy” on the part of the Crown.

No treaty rights can possibly be adversely impacted by the impugned Crown conduct in this case. Speculation does not satisfy the third element of the Rio Tinto test. The appeal was therefore dismissed.

http://www.canlii.org/en/sk/skca/doc/2015/2015skca31/2015skca31.html

Author

Scott Kerwin 
SKerwin@blg.com
604.640.4029

Expertise

Aboriginal Law