The Ontario Court of Appeal earlier this year provided some
helpful confirmation to companies in the natural resources sector
seeking licenses from the Province.
In Keewatin v Ontario (Natural Resources)1,
the Court of Appeal confirmed the Province's right to
"take up" what became provincial lands, subject to an
aboriginal treaty negotiated by the federal government, without
federal government approval. The Court of Appeal did so with regard
to the quintessential Canadian principles of federalism,
constitutional evolution, and the indivisibility of the Crown. As
we celebrate Canada Day 2013, we consider a case that highlights
these parts of our Canadian identity.
Facts and judicial history
The subject treaty, Treaty 3, was signed by representatives of
the Dominion of Canada and the Saulteaux Tribe of the Ojibway
Indians (the "Ojibway") in 1873. The treaty includes a
"harvesting clause" that permits the use of the land for
hunting and fishing by the Ojibway, with the exception of land
"taken up for settlement, mining, lumbering or other purposes
by [the] Government of the Dominion of Canada."
In 1997 the Ontario Minister of Natural Resources granted a
sustainable forestry license to Abitibi-Consolidated Inc.
("Abitibi"). This license allowed Abitibi to conduct
forestry operations on the Keewatin lands, which are governed by
Treaty 3. The Grassy Narrows First Nation objected to the license
on the basis that it violated the harvesting clause.
The trial judge found in favour of the plaintiffs on every main
issue. Specifically, she determined that Ontario did not have the
authority to "take up" tracts of Keewatin land for
forestry under Treaty 3, nor did Ontario have the authority to
infringe on the hunting and fishing rights provided in Treaty 3,
without federal government approval. Ontario, Abitibi and Canada
appealed her decision.
The Decision: Canadian Constitutional Principles
The main issue on appeal was whether Ontario was empowered to
take up lands and restrict harvesting rights in the Keewatin
territory, and if not, whether Ontario, through the division of
powers created under the Constitution Act, 1867, could
justifiably infringe upon hunting and fishing rights of the Grassy
Narrows First Nation.
The Court of Appeal reversed the trial judge's decision and
allowed the appeal. The Court of Appeal relied on three sections of
the Constitution Act, 1867 to demonstrate that Ontario had
the right to take up lands under Treaty 3:
Section 109 gives Ontario beneficial ownership of the land
inside its borders, subject to trusts or other interests already
existing in those lands, including pre-existing aboriginal
Section 92(5) gives Ontario the exclusive authority to manage
and sell public lands that belong to the Province; and,
Section 92A allots the powers relating to non-renewable natural
resources, forestry resources and electrical energy to the
The Court of Appeal also relied on the principle that the
"Crown" as between Canada and the provinces is
indivisible. As such, it was of no consequence that Canada, and not
Ontario, was the treaty partner to Treaty 3. The Court of Appeal
accordingly confirmed that Ontario was empowered to "take
up" lands within the meaning of Treaty 3.
In coming to its decision, the Court had to balance the Canadian
"living tree" concept of constitutional evolution with
the Crown's enduring duty towards Canada's First Nations.
The responsibility for the Crown's promises, including its
promises to its aboriginal treaty partners, is determined by the
allocation of power under the constitution, which evolves over
time. Treaty 3, including the harvesting clause, was established
between the Ojibway and the Crown, not the Ojibway and a particular
level of government. The extension of Ontario's border in 1912
to include the Keewatin lands meant Ontario became both beneficial
owner and the Crown within the meaning of Treaty 3. The Crown's
special relationship with the First Nations remained continuous
even though the government, on whose advice the Crown acts,
What it Means for the Natural Resources Sector
By respecting the indivisibility of the Crown in aboriginal
treaty disputes the Court of Appeal made a finding that provides
some comfort to business interests in a distinctively Canadian way.
The interpretation of treaties and the ever-important principle of
reconciliation between the Crown and aboriginal peoples are
addressed through the evolving federalist structure of Canada.
Natural resource companies can continue to rely on the licenses
that they procure from the Province of Ontario.
1. 2013 ONCA 158
The foregoing provides only an overview. Readers are
cautioned against making any decisions based on this material
alone. Rather, a qualified lawyer should be consulted.
On December 19, 2016 the Government of Canada released its much anticipated guidelines on the national security review of investments under the Investment Canada Act (the "National Security Guidelines").
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).