September 2014

Tsilhqot’in ruling rattles resource industry

Mining industry uncertain in the wake of landmark aboriginal title decision in B.C.

By Brenda Bouw

A landmark court decision involving aboriginal title in British Columbia is expected to change how mining companies work with First Nations on developing resources.

On June 26, the Supreme Court of Canada affirmed that six Tsilhqot’in bands have title over 1,700 square kilometres of land in central B.C.

This is the first time Canada’s highest court has recognized aboriginal title on a particular site. Title, as defined by the ruling written by Chief Justice Beverly McLachlin, is the “right to use and control the land and enjoy its benefits.” That includes the right to benefit economically from the land, while ensuring it is sustained for future generations.

The Tsilhqot’in decision also states the Crown can infringe upon aboriginal title only if they comply with Section 35 of the Constitution Act, which is the duty to consult with First Nations and justify their actions “on the basis of a compelling and substantial purpose.” The Crown has a legal duty to “negotiate in good faith to resolve claims to ancestral lands,” according to the ruling.

The decision is significant because it recognizes that Aboriginal Peoples own their ancestral lands where they prove title and can therefore determine how to use them. That is, unless they signed the land away in treaties with federal or provincial governments. Most jurisdictions in Canada are covered by a modern or historic treaty. The implications of the Tsilhqot’in ruling are greatest in B.C., where most First Nations’ groups have not signed treaties. That said, there are aboriginal title claims in other provinces.

The ruling sets a precedent for other First Nations that may want to establish aboriginal title on their land. A handful has already stated publicly that they too intend to pursue it.

The Tsilhqot’in ruling does not say whether aboriginal title includes mineral rights, which has sent many mining companies scrambling for legal advice. There is particular uncertainty around how much leverage First Nations’ groups with aboriginal title will have to halt development of resource projects.

Thomas Isaac, leader of the aboriginal law group at Osler, Hoskin and Harcourt, said the decision does not provide a guidebook for mining companies, governments or First Nations. Questions remain as to what the limits of aboriginal title are, Isaac said, including the rights of private parties affected, like mining companies, and if provinces can override aboriginal title.

He believes the ruling puts the onus on both federal and provincial governments to balance aboriginal and non-aboriginal interests fairly and reason­ably. “We need to be monitoring very carefully how governments are going to move forward in implementing what they now know on aboriginal title lands,” Isaac said.

The mining industry has been largely quiet since the ruling was announced. A handful of company executives contacted for this article did not want to speak publicly, but some expressed concern about what it could mean for their projects.

“Just when we thought we were heading in the right direction with benefit agreements and job training, now we’re back to fear and uncertainty and unknowing,” said one long-time industry executive, who did not want to be named. “There are some potentially serious consequences here.” The executive worries the uncertainty surrounding the ruling will deter investment and, in turn, project development.

Gavin Dirom, president and CEO of the Association for Mineral Exploration BC, acknowledged the potential impact on investor confidence but cautioned the industry not to panic. “Since subsurface resources are held by the Crown in the public interest, this ruling should not significantly change anything because the Crown can justify that minerals beneath aboriginal title lands should be responsibly explored and potentially developed for the greater good, both socially and economically,” Dirom said.

He believes the ruling should encourage mining companies to continue developing stronger relationships with aboriginal communities. That includes early and ongoing consultation, and striking agreements for revenue sharing or other benefits. “The ruling reaffirms that engagement and consultation is the right thing to do,” said Dirom.

Predictions that resource development will freeze as a result of the Tsilhqot’in ruling are “ridiculous and avoidable,” wrote Judith Sayers (Kekinusuqs), a lawyer from the Hupacasath First Nation in Port Alberni, B.C., in an opinion piece published by the Tyee. “Generally, if you plan to do business in a First Nations’ territory, go see the First Nation at the very early stages, before any planning is done,” she said.

And if the aboriginal group is open to development, she added, companies should “acknowledge the title of the First Nation and their ability to consent to a project; this will build relations and enable you to carry out your work in a respectful manner.”

Sayers said she believes consent also extends to First Nations that have not proven title, noting the Crown now has a “procedural duty” to consult and accommodate as a result of the Tsilhqot’in decision. “Aboriginal title is now a reality that the federal and provincial governments must recognize and act appropriately with that title in mind,” she said.

Since the ruling, the Tahltan Central Council, which represents the Tahltan people of northwestern B.C., has said it plans to go to court to fight Fortune Minerals Ltd. and the development of its Arctos Anthracite project. They claim the project is located on Tahltan traditional territory.

Now that the Tsilhqot’in has established land title, they say they would develop mining projects under the right circumstances. “It will be with companies that respect our values and […] work with us,” said Joe Alphonse, tribal chair with the Tsilhqot’in national government.

“They need to come to our door first. That is the road to certainty.”

The Tsilhqot’in National Government released a draft mining policy a month after the ruling, which says it will require exploration and benefit agreements before approving any exploration or mining projects. It will also consider partnership and ownership opportunities with mining and exploration companies and wants the Tsilhqot’in people to have priority when it comes to jobs, training and contracts.

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