Canada: Yukon Court Of Appeal Confirms That "Open-Entry" Mining System Does Not Preclude The Application Of The Duty To Consult

In December 2012, a three-judge Court of Appeal for Yukon decided unanimously¹ that the recording of a mineral claim by the Mining Recorder, pursuant to Yukon's Quartz Mining Act (the Act),² triggers the duty to consult. Furthermore, the court held that merely providing notice of recorded claims to affected First Nations was not necessarily sufficient to discharge the government's obligation to consult. The decision has significant implications for the mining and prospecting system in Yukon, and potentially for other open- or free-entry systems in Canada.

The Act permits individuals to acquire mineral rights by simply physically staking a claim and then recording it with the Mining Recorder. If a claim complies with the statutory requirements, the Recorder is obliged to record the claim. Once a quartz mining claim is recorded, the claimant is entitled to the minerals within the claim and may conduct certain low-impact exploration activities³ on the land without further notice to or authorization of the government.

Ross River Dena Council, the plaintiff, is one of three Yukon First Nations that have not entered into treaties with the governments of Yukon and Canada with respect to their claims to aboriginal title and rights. The plaintiff's claims are to the Ross River area in southeastern Yukon. The plaintiff asserted that the government had a duty to consult it before recording mining claims in the Ross River area, which it had failed to discharge.

"Contemplated Crown conduct"

A key issue in this case was whether the recording of a quartz mineral claim within a territory that is subject to aboriginal rights and title claims constitutes "contemplated Crown conduct"⁴ sufficient to require consultation. The Act does not grant the Mining Recorder any discretion: if a claim formally complies with the requirements of the statute, the Recorder must record it. On that basis, the government argued there was no "contemplated conduct" to trigger consultation.

Writing for the court, Groberman J.A. dismissed this argument, holding that, "Statutory regimes that do not allow for consultation and fail to provide any other equally effective means to acknowledge and accommodate aboriginal claims are defective and cannot be allowed to subsist." Groberman J.A. acknowledged that in Rio Tinto the Supreme Court of Canada left open the question of whether "Crown conduct" includes legislative action, but interpreted this reservation narrowly, allowing that though the doctrine of parliamentary sovereignty may preclude the imposition of a requirement to consult prior to introducing legislation, such a limitation "could not justify the absence of consultation in the carrying out of a statutory regime."

Scope of required consultation

The chambers judge, out of concern for the viability of the open-entry system, determined that the duty to consult would be fulfilled by providing the plaintiff notice of mineral claims recorded in its traditional territory. The Court of Appeal disagreed; it recognized the historical and economic significance of the open-entry system to Yukon, but held that the system must be modified in order for the Crown to act in accordance with its constitutional duties. Groberman J.A. stated that the potential impact of mining claims on aboriginal title and rights required deeper consultation than notice.

In assessing the appropriate scope of consultation, Groberman J.A. accepted that the Government of Yukon had afforded interim protection (by way of Order in Council) to lands selected by the plaintiff in order to preserve them for potential inclusion in a settlement of claims by way of treaty. Groberman J.A. did not assess the adequacy of such measures against the Haida framework,⁵ instead suggesting that given the imminent expiry date of the Order in Council (March 2013), further consultation would need to take place.

Groberman J.A. indicated that a prohibition on locating claims in all or part of an area subject to aboriginal claims would be the most obvious method of accommodating title claims. With respect to aboriginal rights, which raise other issues, it is the actual performance of work on the land that may affect such rights. Therefore, when exploration activities could have "serious or long-lasting adverse effects" on aboriginal rights, the court held that affected First Nations must be provided with notice of the proposed activities and, where appropriate, an opportunity to consult prior to any activity occurring. Groberman J.A. stated that the Crown must ensure it maintains the ability to prevent or regulate activities where it is appropriate to do so, in spite of a statutory scheme that might suggest otherwise.

The court also relied on Section 15 of the Act, which allows the government broad discretion to prohibit the location of quartz mining claims on particular lands, and could be used to exclude from quartz mining claims areas in which activities would prejudice aboriginal rights. Consequently, the court did not need to rule on whether the Act was inherently incompatible with the duty to consult.

Conclusion and impact of decision

In closing, Groberman J.A. acknowledged that the Act, as presently drafted, may not be the "ideal instrument" for ensuring adequate consultation, and indicated that it is open to the legislature to fashion a more flexible or precise statutory mechanism. The court suspended its declarations for a period of one year to permit the government to make the appropriate statutory amendments.

The Government of Yukon has 30 days to appeal the decision to the Supreme Court of Canada. It has not yet given any indication whether it will do so. Should leave be granted, the appeal will undoubtedly be watched closely. This decision is significant not only for its potential repercussions for the open-entry mining system where claim to title is strong and on the conduct of exploration activities where aboriginal rights may be affected, but also for its commentary on whether government conduct includes legislative action.

Footnotes

^{1 Ross River Dena Council v. Government of Yukon, 2012 YKCA 14.}

^{2 S.Y 2003, C. 14.}

^{3 Permitted exploration activities include the clearing of land, construction of lines, corridors and temporary trails, the use of explosives and the removal of surface rock.}

^{4 The court employed the three-part test set out by the Supreme Court of Canada in Rio Tinto Alcan Inc. v. Carrier Sekani Tribal Council, 2010, SCC 43, [2010] 2 S.C.R. 650: "[The ... duty to consult arises "when the Crown has knowledge, real or constructive, of the potential existence of the aboriginal right or title and contemplates conduct that might adversely affect it" (para. 35 [of Haida]). This test can be broken down into three elements: (1) the Crown's knowledge, actual or constructive, 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 right. [Emphasis in original.]"}

^{5 In Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73, [2004] 3 S.C.R. 511, the Supreme Court of Canada first articulated the duty to consult.}

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