Copyright 2008, Blake, Cassels & Graydon LLP
Originally published in Blakes Bulletin on Environmental Law, July 2008
The June 13, 2008 Federal Court of Appeal decision in Miningwatch Canada. v. Canada (Minister of Fisheries & Oceans) (Miningwatch appeal decision) should be of great interest to aficionados of tennis and ping pong. It represents the latest in a series of alternating decisions involving the discretion vested in government authorities during the scoping of federal environmental assessments. For those keeping score, the Miningwatch appeal decision reverses the Miningwatch trial decision (rendered on September 25, 2007), which trial decision had essentially reversed the previous Federal Court of Appeal decision in Prairie Acid Rain Coalition v. Canada (Minister of Fisheries & Oceans) (hereafter referred to as "Truenorth").
The Miningwatch case involves an open pit gold and copper mine and milling operation located in British Columbia ("Red Chris mine proposal"), that is subject to a federal environmental assessment. The act governing federal environmental assessments is the Canadian Environmental Assessment Act (CEAA).
There are four categories of assessments under CEAA: screenings; comprehensive studies; panel reviews; and mediations. The vast majority of projects undergo a screening, which is the most basic category. The next category is a comprehensive study. The main differences between the two are that a comprehensive study involves the review and analysis of additional factors and (since 2003) requires public consultation.
As a result of its involvement in the issuance of licences or approvals, the Department of Fisheries and Oceans (DFO), was determined to be a Responsible Authority (RA) under CEAA. The effect of being an RA is that an RA determines the scope of a project in relation to which an environmental assessment is to be conducted. The scope of the project has a direct correlation to the category of environmental assessment that a project undergoes.
The issue in the Miningwatch case centered around the category of assessment to which the Red Chris mine proposal was subject. The category initially selected by DFO was a comprehensive study, and was later converted into a screening. Opponents challenged the decision to convert the category of assessment. Their application included a request for a declaration that the Red Chris mine proposal was properly subject to a comprehensive study level of assessment. Such a declaration would necessarily result in increased public consultation.
Truenorth Trial And Appeal Decisions (The Law From September 2004 To September 2007)
To understand the context of the Miningwatch appeal decision, and the rationale for the change in the assessment category, requires an understanding of the earlier Truenorth decisions. Truenorth dealt with a proposed oil sands extraction mine located in Alberta. The mine involved the destruction of a stream and therefore required a prescribed CEAA authorization from DFO. As such, it was subject to a federal environmental assessment. Notwithstanding that the overall project involved the operation of an oil sands mine, DFO scoped the project as only involving the destruction of the stream and related activities, which meant that the project was only subject to a federal screening. That scoping decision was challenged by various groups as being improper and too narrow.
One of the arguments raised in opposition to the scoping decision was predicated upon the Comprehensive Study List Regulations (CSL Regulations) enacted under CEAA. If a scoped project meets the criteria as set out in the CSL Regulations, a project is required to undergo a comprehensive study. The proposed oil sands project met the description set out in the CSL Regulations and prima facie appeared to require a comprehensive study. The Applicants therefore argued that it was improper for the RA to scope the project in a manner that only resulted in a screening. The Applicants were unsuccessful in their argument. Rather, the court in Truenorth – both at trial and on appeal – held that notwithstanding that a project description met the CSL Regulations, an RA still had the discretion to scope the project in a manner differently and more narrowly than as set out in the project description, so as to include only those aspects of the project related to an RA's jurisdiction and responsibility.
The Truenorth decisions dramatically affected the Red Chris mine proposal. The Red Chris mine proposal was initially subject to a comprehensive study because it exceeded the ore production threshold set out in the CSL Regulations.
After the Truenorth trial decision was rendered, and in reliance on that decision, DFO re-scoped the project, indicating that it was no longer subject to a comprehensive study. Rather, the portion of the project pertaining to DFO's jurisdiction and responsibility under CEAA was only subject to a screening. The effect of the Truenorth decisions is that they upheld the discretion vested in an RA and enabled an RA to scope a project in a manner narrower than as set out in a project description.
Miningwatch Trial Decision (The Law From September 2007 To June 2008)
The Miningwatch trial decision was rendered after the Truenorth decisions. In an extensive judgement, the judge went to great pains to discuss and distinguish the Truenorth decisions. In so doing, the judge emphasized certain amendments that had been made to CEAA in 2003 (2003 amendments), which introduced the requirement of public consultation in a comprehensive study. The judge noted that the Truenorth decisions only dealt with the provisions of CEAA as they were prior to 2003 and concluded that due to the changes relating to required public consultation, the law after 2003 was different.
After reviewing all of the 2003 amendments, the judge concluded that they introduced the fundamental aspect of a duty to consult the public at an early stage. The judge subsequently held that where a project as set out in a proponent's project description meets the CSL Regulations, an RA must ensure public consultation and must ensure that the entire project undergoes a comprehensive study. In other words, although the RA has some discretion to scope a project, that discretion is constrained by the initial project description.
The Miningwatch trial decision severely restricted the ability of an RA to scope a project. The determining factor in scoping a project was the manner in which the project was described by the project proponent rather than the discretion vested in an RA. The practical effect of the decision was that after it was rendered, DFO, as the RA for the Red Chris mine proposal, re-scoped the mine as once-again requiring a comprehensive study. This was one of several projects that were re-scoped around that time, the basis for all of them being the Miningwatch trial decision.
Miningwatch Appeal Decision (The Law As Of June 13, 2008)
In its decision, the Appeal Court overturned the Miningwatch trial decision and, notwithstanding the 2003 CEAA amendments, held that its earlier decision in Truenorth prevailed. The Appeal Court confirmed that an RA has the discretion to scope a project, and that it is the project "as scoped" by the RA that determines whether or not the CSL Regulations are triggered. If the CSL Regulations are not triggered, then public consultation does not arise.
The Miningwatch appeal decision reaffirms the discretion vested in RAs in scoping a project as part of the federal environmental assessment process. The critical factor in determining if a project is subject to a comprehensive study is no longer predicated upon the project description as described by the proponent. Rather, it is predicated upon the project "as scoped" by the RA, after taking into account its jurisdiction and responsibility under CEAA. If the project "as scoped" by the RA falls within the CSL Regulations, then and only then is the project subject to a comprehensive study.
The Miningwatch appeal decision is the latest in a series of decisions involving the discretion vested in RAs during the scoping of a project under CEAA. At this time, it is unknown if an application will be made for leave to appeal the decision to the Supreme Court of Canada. However, in light of the fact that it is a reaffirmation of the court's earlier position in Truenorth and that the Supreme Court of Canada previously denied leave to appeal in Truenorth, it seems reasonable to assume that leave to appeal (if requested), will be similarly denied.
As of today, based on the Miningwatch appeal decision, an RA has full discretion to scope a project in a manner that is narrower than a project proponent's project description and consistent with an RA's jurisdiction and responsibility under CEAA. Project proponents and their advisors are well advised to remain aware of this discretion and not assume that a project, even if prima facie meeting the CSL Regulations, is automatically subject to a comprehensive study level of assessment and is automatically subject to public consultation.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.