Canada: British Columbia Court Of Appeal Confirms Province's Jurisdiction Over Mining

On November 3, 2016, the British Columbia Court of Appeal (BCCA) issued reasons in Cowichan Valley (Regional District) v. Cobble Hill Holdings Ltd., 2016 BCCA 432. The case was an appeal from a British Columbia Supreme Court (BCSC) decision to grant injunctive relief to the Cowichan Valley Regional District (CVRD) against Cobble Hill Holdings Ltd. (Cobble Hill). In essence, the injunctions prevented Cobble Hill from continuing reclamation activities on a quarry it owned on the basis that this activity was prohibited by a CVRD bylaw. This decision is significant because the court held that:

• the Province has exclusive jurisdiction over mining and mining activities; and
• under the Mines Act, a quarry is a "mine" and site reclamation is a "mining activity".

Cobble Hill is the fee simple owner of land in the Cowichan Valley. It operates a rock quarry on this land pursuant to a permit issued by the British Columbia Ministry of Energy and Mines (MEM) under the Mines Act, R.S.B.C. 1996, c. 293. An integral part of quarrying is reclamation, which is the restoration of the land to its pre-quarry state by backfilling the cavity with soil. In 2006, Cobble Hill's permit allowed it to reclaim its quarry site using "clean" soil. However, the MEM and the British Columbia Ministry of Environment (MOE) subsequently granted an amendment to the permit allowing Cobble Hill to use contaminated soil to backfill the quarry cavity. The amended permit also authorized an alternative facility that would permit Cobble Hill to undertake bioremediation of the contaminated soil on site.

The CVRD, the local government with zoning authority in the Cowichan Valley, disputed these amendments. It commenced a petition seeking to stop Cobble Hill's modified on-site reclamation process, arguing that Cobble Hill's reclamation activities were effectively a landfill. Because landfills are a use of land subject to local government regulation under the general zoning power in the Local Government Act, S.B.C. 2016, c. 1 (LGA), the CVRD contended that this reclamation activity should cease since it was prohibited by a CVRD zoning bylaw. The BCSC agreed, holding that Cobble Hill's site reclamation was a landfill subject to regulation under, and prohibited by, a CVRD zoning bylaw. As such, the court granted the CVRD injunctive and declaratory relief. Cobble Hill appealed.

The quarry site reclamation is not a landfill

The first issue the BCCA considered was whether the BCSC was correct to deem Cobble Hill's reclamation a landfill. If this was correct, the appeal would be decided in favour of the CVRD since landfills are undoubtedly a use of land subject to local government zoning.

The BCCA concluded, however, that the quarry site reclamation was not a landfill. To characterize this reclamation as a landfill was to ignore that the clear purpose of the reclamation activity was to backfill a quarry and was not to create a municipal waste dump. Further, this characterization ran counter to the Environmental Management Act, S.B.C. 2003, c. 53 (EMA), under which the amended permit was issued. The EMA clearly distinguishes between municipal waste and the environmental waste, including soil, handled in the reclamation.

A quarry is a "mine" and its reclamation is a "mining activity"

Next, the BCCA agreed with Cobble Hill that a quarry is a "mine", and reclamation a "mining activity", under the Mines Act. The court considered the definitions set out in the Mining Act, and noted that "mine" includes a place where excavations are made to explore for rock, and "mining activity" includes activity related to the reclamation of a mine. Thus, it is the disturbance of the surface of land for the excavation of rock that is a "mine". Following this interpretation, the court concluded that a quarry is a mine. Site reclamation, the court held, also falls within the definition of "mines" and "mining activity". It was thus clear to the BCCA, in light of these provisions, that quarries and their reclamation were integral parts of the unified regulatory regime for the oversight of mining in British Columbia.

The Province has exclusive jurisdiction over mines and related reclamation

Finally, the BCCA agreed with Cobble Hills argument that the Province of British Columbia has exclusive jurisdiction over the regulation of mines and their related site reclamation activities. It was the legislature's clear intent, according to the court, that the Province have jurisdiction over mining in light of its importance to the provincial economy. This intent was apparent given, among other things, that (1) that the LGA incorporated the definition of "land" from the Community Charter, S.B.C. 2003, c. 26, which expressly excludes "mines"; and (2) many other provisions and statutes reserve control of mines and mining activities to the Province to ensure a unified provincial regulatory scheme.

In particular, the court emphasized that s. 9(3) of the Community Charter, which the LGA adopts, requires the Province's approval for a soil bylaw to be enforceable. The CVRD does not have a soil deposit bylaw because it has been unable to obtain provincial approval for one. In the absence of such a soil deposit bylaw, the court held that the CVRD could not regulate or prohibit the deposit of soil on Cobble Hill's land.

In its arguments, the CVRD relied heavily on Squamish (District) v. Great Pacific Pumice Inc. et al., 2003 BCCA 404 (Pumice). In that decision, the court held that the off-site storage and processing of minerals did not fall within the "mines" exclusion in the definition of "land" in the LGA. On that basis, the off-site storage land was subject to municipal land use regulations. However, the BCCA decided that Pumice was not applicable to Cobble Hill's situation. Pumice, the court said, did not address the issue of whether a quarry and its site are captured by the definition of "mine" and "mining activity" in the Mines Act. Rather, in Pumice, the court held that off-site storage and processing of minerals is not site reclamation. Cobble Hill's activities were on site and were reclamation, which brought them within the definition of "mines" and "mining activity". The court therefore concluded that Pumice did not support the CVRD, and held that the Province had exclusive jurisdiction over the regulation of Cobble Hill's activities at the quarry.

In the result, the BCCA allowed Cobble Hill's appeal. The exception, however, was that Cobble Hill could not undertake the bioremediation of the contaminated soil on site. Unlike the reclamation and quarrying activities, this was not integral to site reclamation, was not "mining activity", and was thus subject to local government land use regulation.

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