Canada: Ontario Divisional Court Weighs In On Funding Consultation

Last week saw the release of three court decisions relating to the Crown's duty to consult Aboriginal peoples.  This Bulletin focuses on the Ontario Divisional Court's decision. In Saugeen First Nation v Ontario¹, the Ministry of Natural Resources and Forestry ("MNRF") issued an aggregate license for a limestone quarry pursuant to the Aggregate Resources Act.  By way of judicial review, the Court set aside the license finding that the Crown failed to discharge its duty to consult.  The Minister may approve the license, if appropriate, following sufficient consultation.

MNRF effectively conceded that there were flaws in the consultation process over several years. It argued that the Crown's duty had been satisfied, however, since the concerns raised by the Saugeen Ojibway Nation were addressed through mitigation measures. The First Nation disagreed, asserting that it was denied the ability to "flesh" out its concerns properly given the lack of funding for, among other things, expert advice.

MNRF faced a common challenge for the Crown (and proponents) namely the appropriate response to broad assertions of impacts with little if any identified direct impacts arising from the proposed activities.² The Saugeen Ojibway Nation asserted that the operation of the quarry would have an adverse impact to adjacent wetland habitat and sensitive species and that there were potential archaeological resources on the quarry lands.  It took the position that it could not provide information about the nature of the impacts, however, without obtaining technical expert advice and undertaking a number of other steps for which it needed funding.

MNRF's failure over several years to engage with the First Nation in a coherent, consistent and transparent manner drove the Court's decision.  The Court found that MNRF breached the Crown's duty to consult in several ways principally by failing to follow its own processes.  As stated by the Court: "Consultation processes are not cast in stone, and may change or evolve over time. However, that is not what happened in this case. MNRF changed its positions several times, but not, so far as can be determined from the record, because of material changes in circumstances regarding SON".³

The Court was critical of MNRF's conclusion that mitigation measures were reasonable to address potential adverse impacts on the First Nation.  The Court stated: "A review of the reasonableness of MNRF's substantive conclusions is thus, premature.  Consultation is a process involving a First Nation.  Imposing MNRF's view of what is reasonable, without adequate  consultation with SON, would be to endorse a version of paternalism entirely inconsistent with the duty to consult: it would be tantamount to saying, 'We know what is best for you and we don't need to hear from you on that issue'".⁴ The Court may have viewed things somewhat differently on "better" facts. 

Funding

The Court acknowledged that the Crown could reject a First Nation's request to retain experts at the Crown's cost.  Accordingly, although the Court required MNRF to fund the First Nation here, it did so only on the basis that the honour of the Crown required it to "keep its word where there is no basis on which the Crown should be relieved of its agreement".⁵ Here, MNRF had committed to provide a specific dollar amount of funding to the Saugeen Ojibway Nation in 2012 and confirmed that funding and an additional amount in 2015.

Undoubtedly, this decision will be relied upon to support First Nation requests to the Crown and proponents for funding for experts, independent reviews and other steps on the basis that such is necessary to identify the nature and scope of potential impacts to Aboriginal or treaty rights. In so doing, it may make consultation, particularly at the lower end of the continuum, more difficult.

Cumulative Effects 

The Crown and proponents increasingly are facing from First Nations the assertion that "cumulative effects" as a result of general development within a traditional territory give rise to a duty to consult respecting a specific project.  The Court did not make any findings on this issue but stated in obiter that cumulative effects can be a "proper matter for consultations".

Proponent's Role 

The proponent was a private company which owned the lands on which the quarry would be located.  The Crown sought to delegate the procedural aspects to the proponent.  The proponent insisted that the duty was the Crown's responsibility and refused to deal directly with the First Nation.⁶ The Court held that the proponent did not have an obligation here to accept the delegated consultation, observing that: "...though the duty to consult is the Crown's, proponents have an interest in facilitating the consultation process...It was entitled to do this [refuse to take on the role], but one consequence of its decision is further delay to complete adequate consultations".⁷

Although the duty to consult is founded on the honour of the Crown, its shortcomings can have obvious and significant consequences to a proponent. The Saugeen case is a useful reminder that it is in a proponent's best interest to carefully consider its participation in the process and to maintain vigilance over the Crown.

The Supreme Court of Canada also released two decisions regarding the ability of regulatory processes to satisfy the Crown's duty to consult. Both related to National Energy Board approvals. ⁸ For further details on these decisions please see http://www.fasken.com/en/scc-finds-neb-has-mandate-to-consult/.

Footnotes

1 2017 ONSC 3456.

2 The size of claimed traditional territories of many First Nations exacerbates the situation.

3 Supra, note 2, para. 124.

4 Supra, note 2, para. 128. It is worth noting that the Court also found that general public notice requirements do not include notice to an affected First Nation. The Crown must prove that notice has been given to a First Nation if it asserts that consultation can be satisfied through notification only.

5 Supra, note 2, para. 127.

6 At some stage he asked his hydrogeologist to speak to the First Nation's hydrogeologist, but the First Nation had no knowledge of the discussion.

7 Supra, note 2, paras. 7, 121.

8 2017 SCC 41; 2017 SCC 40

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