The decision of the Yukon Court of Appeal in Ross River Dena Council v. Government of the Yukon – delivered just days before the end of 2012 (on Dec 27th) – may force governments across Canada – including in BC – to rewrite their mining laws. The decision essentially holds that the “free entry system” – a system of allocating mineral rights that is central to mining law in much of Canada, including BC – is inconsistent with the obligation of the Crown to consult First Nations on decisions that may impact their Aboriginal Title and Rights.

What is “Free Entry”?

At the root of the conflict in the Ross River Dena case is the free entry system, which has given the mining industry unrestricted access to “stake a claim” on most public, private and First Nations lands since the time of the gold rush, based on the antiquated assumption that mining deserves priority over all other land uses. Our 2004 Report – Undermining our Future – explains the rights typically associated with free entry (here’s the 2 page summary version), and some of the reasons why it is a cause for concern:

There are three primary rights associated with the law of free entry:

the right of entry and access on lands that may contain minerals; the right to locate and register a claim without consulting the Crown [or First Nations]; and the right to acquire a mineral lease with no discretion on the part of the Crown.

A core difficulty with free entry lies in the non-discretionary way it provides priority to mining rights over others, including private landowners, and other resource users, such as timber, oil or gas, and tourism operators. These other users are governed by a discretionary system, whereby the Crown decides how and whether tenures should be granted, and retains the ability to decline allocating these rights for a particular policy reason. The lack of discretion in the free entry system means that no consideration of environmental values occurs when mineral tenures are granted, and the environment is left unprotected.

The Crown has also taken the position that because of the discretionary nature of the free entry system, it has effectively legislated itself out of its constitutional duties to First Nations – a position rejected by the Yukon Court of Appeal in the recent Ross River Dena case.

First Nations and Free Entry: Ross River Dena Council v. Government of the Yukon

The territory of the Ross River Dena, who are part of the Kaska Nation, stretches over a vast area of 63,000 km2 in the South Eastern Yukon. The Ross River Dena Council recently challenged the free entry system, asserting that the Government of the Yukon had an obligation to consult with them before recording quartz mining claims in the Ross River Area.

The Yukon Supreme Court held that the Crown did have a duty to consult with First Nations on the recording of a mining claim, but could meet this duty by simply giving notice to the affected First Nation after the grant of the mineral claim. The Yukon Court of Appeal has soundly rejected this approach, holding that something more than mere notice is required:

“It is apparent that the judge considered the open entry aspects of the Quartz Mining Act to be essential to the mining industry, and considered that any requirement of consultation greater than the mere furnishing of notice claims would be impractical.

I am of the opinion that the judge erred in his analysis. I fully understand that the open entry system continued under the Quartz mining Act has considerable value in maintaining a viable mining industry and encouraging prospecting. I also acknowledge that there is a long tradition of acquiring claims by staking, and that the system is important both historically and economically to Yukon. It must, however, be modified in order for the Crown to act in accordance with its constitutional duties.

The potential impact of mining claims on Aboriginal title and rights is such that mere notice cannot suffice as the sole mechanism of consultation. A more elaborate system must be engrafted onto the [free entry] regime set out in the Quartz Mining Act. In particular, the regime must allow for an appropriate level of consultation before Aboriginal claims are adversely affected.”

On the basis of this reasoning, the Court of Appeal allowed the appeal, and held that the Government of the Yukon “has a duty to consult with the plaintiff in determining whether mineral rights on Crown lands within lands compromising the Ross River Area are to be made available to third parties”, as well as prior to allowing mineral exploration activities.

The court in this case was not actually asked to strike down the Quartz Mining Act; nevertheless, the judges chose to address the possibility of statutory change, suggesting that existing provisions available for accommodating First Nations under the Quartz Mining Act may not be “ideal”.

Free Entry in BC

All provinces that use a free entry approach to mining claims should sit up and take notice. But that goes double for British Columbia because:

Most First Nations territories in BC, like those of the Ross River Dena Council, are not yet subject to treaties. Although BC’s mining laws do provide for government approvals before exploration can occur, mineral claims can be staked on-line and with no opportunity for Aboriginal consultation, and the BC Mineral Tenure Act purports to require that a mining lease, and the substantial rights it bestows, to be granted to the holder of a mineral claim regardless of the outcomes of consultation with First Nations. The Yukon Court of Appeal is made up of judges of the BC Court of Appeal. So even if the judgment of a Yukon court is not technically binding on the BC Supreme Court, for all intents and purposes it is – since a BC Supreme Court judge will know that their appeal may be heard by one or more of the same judges of the BC Court of Appeal.

In our view, BC will need to change its free entry system sooner or later. If the government doesn’t act on the Ross River Dena Council case, and work with First Nations in BC to reform its Mineral Tenure Act, then it will inevitably face similar court cases.

A Lesson from Ontario …

Ontario has recently made amendments to its mining laws to provide for First Nations consultation and land use planning and to prohibit the staking of privately-owned land in Southern Ontario. There too, First Nations litigation played a key role, when the efforts of the Ardoch Algonquin First Nation (AAFN) to prevent the proponent of a proposed uranium mine from accessing its mineral claim area in AAFN territories resulted in a jail sentences and fines for AAFN members (until the Ontario Court of Appeal found that these penalties were “too harsh” and overturned them).

But there were other factors that came together in Ontario, including mobilization of concerned citizens from “cottage country” upset to learn that their land could be staked, their trees cleared, their soil dug up, their peace and quiet destroyed, and their expensive property devalued by mineral claims.

... is BC next?

Conflict over mineral staking in BC has been on the rise since 2005, when amendments to the Mineral Tenure Act began to permit on-line staking with the click of a mouse and a credit card. The result was a dramatic increase in the number of claims staked and exploration activity in BC, including the Sunshine Coast and Gulf Islands.

Most recently tempers flared on Pender Island when two local prospectors registered more than 20 mineral claims covering a large portion of North and South Pender, including the location of a Capital Regional District water improvement project. In commenting to the media, Gary Steeves, North Pender trustee with the Islands Trust emphasized that: “A lot of the people living here are retired and this is scaring the living daylights out of them.” The local RCMP reports that “landowners are getting legal advice and a lot of people are up in arms.”

BC’s free entry system – under which local governments may not restrict mineral claims within their boundaries – has also played a major role in controversial mining projects such as the Ajax Mine in Kamloops and the Raven Underground Coal Project on Vancouver Island, both of which are located very close to residential communities.

The problems with free entry are legion: it presents barriers to protecting important wildlife habitat and watersheds; undermines the ability of local communities to plan for their future; threatens private residential and farm property; and creates conflicts between businesses on the land. These problems, and the conflict they engender, in turn prevent the mining industry from obtaining the ‘social licence’ it needs to move forward with mining projects that do make sense.

Everyone would gain if the Ross River Dena judgment becomes a driver for dealing with this long-standing problem in a way that works for all British Columbians and our environment while upholding Aboriginal Title and Rights.
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Duty to consult applies to free-entry mining regime: Yukon Court of Appeal

Michael McClurg, West Coast Environmental Blog – http://www.oktlaw.com/blog/duty-to-consult-applies-to-free-entry-mining-...

9 January 2013

A recent decision by the Yukon Court of Appeal in Ross River Dena Council v. Government of Yukon 2012 YKCA 14 [“RRDC”], confirms that the Crown’s duty to consult applies to “free-entry” mining regimes. “Free-entry” systems are found in a number of legislative regimes, including Yukon’s Quartz Mining Act, S.Y. 2003, c. 14 and applicable regulations, and until recent amendments, Ontario’s Mining Act R.S.O. 1990, c. M-14, and applicable regulations. Under “free-entry” regimes prospectors can apply to the Crown to register mining claims on Crown land. Once mining claims are registered, the regime authorizes prospectors to subsequently carry out exploratory drilling on those claims. The regimes do not provide the Crown with any discretion in determining whether to register mining claims once a prospector has submitted an application, and no further Crown authorization is necessary in order for the prospector to carry out exploration activities. Examples of these exploration activities include the clearing trees and brush for access roads and drill-pads, drilling in to the ground and the removal of samples, the use of explosives, and others. The end result is that “free-entry” systems in theory would authorize prospectors to go out on land over which First Nations may have claimed title or right, or established rights and carry on potentially destructive activity. Such systems have given rise to tense conflicts between industry and First Nations (see Platinex Inc. v. Kitchenuhmaykoosib Inninuwug First Nation, 2006 CanLII 26171 (ON SC), and Frontenac Ventures Corporation v. Ardoch Algonquin First Nation, 2008 ONCA 621).

Prior to RRDC, some had argued that the duty to consult as set out in Haida Nation v. British Columbia (Minister of Forests) 2004 SCC 73 did not apply in “free-entry” systems because there is no “decision” at issue – under free entry systems the Crown has no option other than to register the mining claims if they are properly staked and the paperwork properly filed. But the Yukon Court of Appeal’s decision unequivocally holds that, notwithstanding an apparent lack of Crown discretion, the duty to consult does indeed apply to these regimes.

The appeal in RRDC was initiated by the Ross River Dena Council [“Council”]. The chambers judge in the court below had held that while the duty to consult applied to the registration of a mining claim, that duty could be fulfilled by the Crown giving notice after the registration of the mining claim. The Yukon Court of Appeal agreed with the chambers judge that the duty to consult applied to the registration of a mining claim but held that the chambers judge was incorrect in holding that notice after the registration of a mining claim was sufficient to fulfill the duty.

In its decision, the Yukon Court of Appeal found that there is some discretion on the part of the Crown in in the Yukon regime in the form of a provision which allows the Crown to withdraw certain lands from prospecting. The Court of Appeal held that because of this provision the legislation itself technically cannot be said to be inconsistent with the Haida principles in that the Crown could consult with an eye to removing certain lands from prospecting under the legislation. In any event, however, the Court of Appeal explicitly rejected the argument that the lack of discretion in the legislation means that the duty to consult does not apply to the “free-entry” system in the Yukon. The Court held that, “Statutory regimes that do not allow for consultation and fail to provide any other equally effective means to acknowledge and accommodate Aboriginal claims are defective and cannot be allowed to subsist”. This statement is arguably the most direct articulation to date from an appellate court of the principle that the constitutional duty to consult is “upstream” of, and takes precedence over, legislative regimes that might purport to limit the Crown’s capacity to consult (see Rio Tinto Alcan Inc. v. Carrier Sekani Tribal Council, 2010 SCC 43 at para. 63, and West Moberly First Nations v. British Columbia (Chief Inspector of Mines), 2011 BCCA 247, at para. 109). The Court of Appeal held that, rather than being something that saves the legislation from the application of the duty to consult, the lack of discretion in the legislation is the source of the problem.

On the question of the scope of consultation required in the registration of a mining claim, the Court of Appeal held that the chambers judge had erred in ruling that notice after the registration of a claim was sufficient. The Court of Appeal held that the regime is required to provide for meaningful consultation before claimed Aboriginal title and/or rights are affected. It held that, “At least where Class 1 exploration activities will have serious or long-lasting adverse effects on claimed Aboriginal rights, the Crown must be in a position to engage in consultations with First Nations before activities are allowed to take place. The affected First Nation must be provided with notice of the proposed activities and, where appropriate, an opportunity to consult prior to the activity taking place. The Crown must ensure that it maintains the ability to prevent or regulate activities where it is appropriate to do so.”

In the end, the Court of Appeal made the following declarations:

1. The Government of Yukon has a duty to consult with the plaintiff in determining whether the mineral rights on Crown lands within lands comprising the Ross River Area are to be made available to third parties under the provisions of the QMA

2. The Government of Yukon has a duty to notify and, where appropriate, consult with and accommodate the plaintiff before allowing any mining exploration activities to take place within the Ross River area, to the extent that those activities may prejudicially affect Aboriginal rights claimed by the plaintiff

This case is of significance in that, barring appeal to the Supreme Court of Canada, it goes a great distance in putting to rest the notion that the Crown can escape its duty to consult First Nations by divesting itself of discretion. If the Crown creates a legal regime that affects and cannot adequately address (through consultation and accommodation) the claimed rights and/or title of First Nations, that regime is “defective and cannot subsist”. While not a surprising result, this case is a welcome addition to the jurisprudence clarifying the significance of the Honour of the Crown and the Crown’s duty to consult Aboriginal people. It is also a strong signal that “free-entry” mining regimes that fail to adequately acknowledge and address Aboriginal rights are a thing of the past.