Canada: The Duty To Consult: Fulfilling Mandated Obligations Is Not Enough

The project proponent, Paramount Resources Ltd. (Paramount), sought land use permits and water licenses to access new well sites and tie in the wells to a newly constructed gathering system. The KTFN possessed aboriginal rights and asserted aboriginal title over Paramount’s proposed development area. As such, the Crown agreed that it owed a duty to consult the KTFN, and undertook a consultation and review process in accordance with the Mackenzie Valley Resource Management Act, R.S.C. 1998, c.25 (the Act). The central issue in this case was whether the Crown failed to discharge its duty to consult.

Under the Act, the Mackenzie Valley Land and Water Board (the Board) is responsible for issuing land use permits and water licences in the unsettled land claim areas within the Mackenzie Valley. Pre-application community consultation prior to a proposal being considered by the Board is required by the Environmental Impact Assessment Guidelines (the Guidelines), which are established pursuant to s. 120 of the Act. Paramount conducted the consultation and submitted its application to the Board. After being satisfied that community consultation had occurred and upon finding that the development might have a significant adverse impact on the environment, the Board referred the proposal to the Mackenzie Valley Environmental Impact Review Board (the Review Board) for an environmental assessment.

The Review Board scoped and oversaw the environmental assessment process, which, under the Guidelines, requires that the concerns of aboriginal people and the general public be taken into account. The Review Board then recommended approval of the project subject to a number of mitigation measures. This recommendation was put before the Responsible Ministers (in this case, the Ministers of Indian and Northern Affairs, Fisheries and Oceans, and the Environment, as well as the Natural Resources Government of the Northwest Territories), who have the final decision-making authority under the Act. The Responsible Ministers may: (1) adopt the recommendation or refer it back to the Review Board for further consideration or (2) consult with the Review Board, then either reject the recommendation and order an environmental impact review of the proposal, or adopt the recommendation with modifications (known as a "consult to modify" process). In this case, the Responsible Ministers chose the latter, and met with the Review Board in a closed door meeting and approved the recommendation (subject to substantial modifications). It was this "consult to modify" process that the KTFN took issue with, namely, that it had not been consulted in this final process.

The duty to consult and accommodate is founded upon the honour of the Crown. It requires participation in processes of negotiation with a view to effect reconciliation between the Crown and aboriginal peoples with respect to the interests at stake. The duty arises when the Crown has knowledge of the potential existence of an aboriginal right or title and contemplates conduct that might adversely affect it.

The content of the duty to consult and accommodate is proportionate to the strength of the claim to the right or title, as well as the seriousness of the potential adverse effect upon the right or title claimed. While not determinative, participation by the Crown in land claims negotiations may be a factor in assessing the strength of the asserted claim.

In this case, the Court found that the KTFN’s claim to title raised a reasonably arguable case, and the Review Board’s report expressed that there was a firm foundation for concern that the development would adversely effect the KTFN’s traditional activities. The factors present in this case, namely the project’s physical scope and potential impact on the environment, and the KTFN’s established rights to hunt, fish and trap, and asserted title, indicated a higher duty; one that demanded formal participation by the KTFN in the decision-making process.

The Court found that the process was in accordance with the Crown’s statutory obligations under the Act, as it provided an opportunity for the KTFN to express their interests and concerns, and ensured that these concerns were seriously considered and, wherever possible, demonstrably integrated into the proposed plan of action. However, the consult to modify process, which did not involve the input of the KTFN, essentially allowed the Crown to unilaterally change the outcome of what was, until that point, a meaningful process of consultation. The Court found that the consult to modify process could not be said to have been conducted with the genuine intention of allowing the KTFN’s concerns to be integrated into the final decision. Interestingly, the Court also found that, had the recommendations of the Review Board been implemented, the duty to consult would likely have been satisfied. The Court concluded that the Crown breached its duty to consult and accommodate, and ordered the parties to engage in a process of meaningful consultation with the view of taking into account the concerns of the KTFN and, if necessary, accommodating those concerns.

Engaging in a statutory process of consultation may discharge the duty to consult and accommodate, but the duty is not boxed in by legislation. Substantial consultation and accommodation throughout an approval process can be undermined by the failure to involve the aboriginal peoples affected in the final decision-making stage.

Shawn Denstedt is a partner in Osler's Calgary office. His practice focuses on environmental, regulatory and aboriginal law issues. Terri-Lee Oleniuk is an associate in the Energy and Litigation groups of the firm’s Calgary office. Matthew Kraemer is an articling student in the firm's Calgary office.

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