Talk Before You Leap: Protect Your Resource Development Project Through Early-Stage Aboriginal Group Consultation

The November 18, 2004 Supreme Court of Canada decisions in Haida and Taku River¹ place a duty on government to consult with and accommodate Aboriginal groups affected by land and resource development. Though legally this duty applies only to provincial and federal governments and not to resource developers, in reality it is in the best interests of industry to ensure sufficient consultation takes place.

Background and Changes to the Law

In Haida, the B.C. Minister of Forests replaced a tree farm license against opposition from, and without the consent of, the Haida Nation. In Taku River, a project approval certificate for the construction of a 160-kilometre mining access road was issued by the B.C. Ministry of the Environment despite objections from the Taku River Tlingit First Nation. In both cases, the province argued that it had no obligation to consult with Aboriginal groups where their Aboriginal rights and title had not been proven. In both cases, the Supreme Court disagreed.

The Supreme Court for the first time set out a duty and general framework by which government must consult with, and in certain circumstances, accommodate Aboriginal groups in cases where Aboriginal title and rights have not yet been proven in court or established by treaty. As such, these decisions are of great significance to the resource development industry.

Though both cases originate from British Columbia, the Supreme Court decisions apply to all situations nationally where Aboriginal groups are potentially affected by land and resource development.

The government’s duty to consult arises whenever it knows of the potential existence of Aboriginal rights or title and is considering conduct that might adversely affect such.

The scope of consultation required is proportionate to the strength of the asserted right or title and the seriousness of the potential adverse impact on it. Mere notice, disclosure of information, and discussion may suffice where claim to title is weak, the Aboriginal right limited, or the potential for infringement minor. Where a strong claim exists, deep consultation including Aboriginal group submissions, Aboriginal participation in decision-making, and written reasons addressing Aboriginal concerns may be required. Rather than defining what constitutes a "strong" or "weak" claim, the Supreme Court stated that parties could themselves assess the strength of a particular claimant’s case, relying on tribunals and courts to assist if they cannot agree. Claimants are to outline their claims clearly to assist in this process. The Supreme Court has left the determination of precisely which duties arise in different situations to future courts, stating that it is impossible to provide a prospective checklist of the level of consultation required. This means that in future cases even if a consultation process is followed, the scope and degree of the consultation may come under fire.

The nature of consultation is that it must be meaningful, conducted in good faith, and include a willingness of the government to make changes. Sharp dealing is not permitted, but hard bargaining is. There is no duty to reach agreement, only to commit to a meaningful process of consultation. Aboriginal groups must not frustrate the government’s reasonable good faith attempts nor may they take unreasonable positions to thwart government efforts. The process does not give Aboriginal groups a "veto". As the reader will appreciate, all of the above can sometimes be fine distinctions and little guidance is given to help define the practical limits of the duty to consult.

Should the results of the consultation process suggest that government policy be altered, a duty to accommodate and address Aboriginal concerns may also arise. As with the duty to consult, little practical guidance is provided as to what circumstances trigger this duty. Where accommodation is required, the government must balance Aboriginal concerns reasonably with the potential impact of the decision on the Aboriginal right or title in question as well as other societal interests.

Industry stands to benefit from the Haida and Taku River decisions in a several ways. First, the Supreme Court was very clear that the duty to consult applies to government; industry cannot be held liable for failing to discharge that duty. Second, many feel the decisions give industry more clarity in dealing with Aboriginal groups. Third, it is now clear that Aboriginal groups do not have a veto power vis-à-vis title or rights not yet defined, they are not permitted to take unreasonable positions against reasonable good-faith government efforts, and there is no duty on the government to actually reach agreement.

These benefits to industry, however, also hide potential pitfalls and unclear answers. First, though resource developers have no duty to consult, they stand to lose the most through insufficient consultation as resource projects could be delayed or prohibited all together. The results in Haida, Taku River, and Gitxsan,² a recent B.C. case that followed Haida and Taku River, could all have potentially been more devastating to industry. In all three cases, the ultimate relief sought was a quashing of governmental approval for the resource project in question. In Haida, the Court refused to quash the tree farm license because it would extensively disrupt existing operations, but had operations not yet begun or the disruption been less extensive, the decision might have been different. In Taku River, the Supreme Court held that sufficient consultation had taken place despite the fact that both the B.C. lower court and Court of Appeal had found that consultation was insufficient and had quashed the project approval certificate. In Gitxsan, the Court encouraged the parties to resume negotiations but allowed the Aboriginal group to re-apply in the future to quash the Minister’s approval.

Should a governmental approval be quashed for insufficient consultation, a resource developer could be sent back to square one. Though the government cannot delegate its duty, it may delegate procedural aspects of consultation to industry. It is, therefore, in the best interests of industry to become involved in the consultation process.

Second, although the decisions provide some clarity in dealing with Aboriginal groups, detailed guidance is still lacking. Until courts provide further clarification, questions such as "how early must consultation begin?", "what is the degree and manner of consultation required in a given situation?", and, "when does the obligation accommodate begin?", remain unanswered.

Third, though the scope of potential Aboriginal group opposition to resource development has been clarified, the fact now facing industry is that any potential existence of Aboriginal rights or Aboriginal title triggers a duty to consult.

In the end, the best advice to industry is talk before you leap: protect your resource development project by ensuring your direct involvement in Aboriginal consultation from the early stages.

© Copyright 2005 McMillan Binch Mendelsohn LLP