On May 22, 2007, G.P. Smith J. of the Ontario Superior Court of Justice granted a declaratory order in Platinex Inc. v. Kitchenuhmaykoosib Inninuwug First Nation, the third in a series of ongoing decisions by G.P. Smith J. involving an application by a First Nation for an injunction to prohibit a mining company, Platinex Inc. ("Platinex") from carrying out exploratory drilling on provincial Crown lands. This most recent declaratory order imposes a memorandum of understanding ("MoU"), a consultation protocol ("CP") and a timetable for future consultation and exploration. The Court also gave express permission to Platinex to begin Phase One of its drilling program based on the MoU, CP and timetable.

Background
Our Legal Update in respect of a previous decision in this matter, released on May 1, 2007, contains a summary of the background of the dispute between Platinex and the Kitchenuhmaykoosib Inninuwug First Nation (the "KI") regarding Platinex’s exploration program for a proposed mining project in the traditional territory of the KI. [To access a copy of this Legal Update, click here]

Prior Proceedings in the Ontario Supreme Court of Justice

On July 28, 2006, G.P. Smith J. granted an "interim, interim injunction" prohibiting Platinex from proceeding with its drilling program, and dismissed Platinex’s application for an injunction prohibiting members of KI from blockading certain access roads to the Properties. The Court ordered KI to set up a consultation committee to seek an agreement with the Platinex and the provincial government to allow the drilling program to proceed.

Despite attempts by all three parties to reach an agreement, no agreement was reached, and KI sought an interlocutory injunction in April 2007 preventing Platinex from conducting its exploratory drill program.

On May 1, 2007, G.P. Smith J. rendered a judgment declaring that adequate consultation had occurred to allow the drilling program to proceed, provided that the parties continued the process of consultation to implement the draft MoU, CP and timetable by May 15, 2007.

The May 22, 2007 Decision

The parties were unable to reach an agreement regarding the implementation of the MoU, CP and timetable by May 15, 2007, and applied to the Court for guidance.

In respect of the ongoing consultations between the parties, G.P. Smith J. commented that each party had made "good faith efforts to appreciate and accommodate the interests of the other." He therefore defined the role of the Court in this instance as providing "supervision and direction/orders whenever required, subject to the recognition that it is ultimately the responsibility of the parties to attempt to reach their own agreement."

The Memorandum of Understanding, Consultation Protocol and Timetable

The Court considered the sufficiency of the MoU, CP and timetable agreed upon by Platinex and Ontario but which had not been accepted by KI (such documents were included as appendices to the decision). The Court held that the MoU, CP and timetable were sufficient to "provide a framework for KI, Platinex and Ontario to engage fully in an on-going consultation process, with accommodation as necessary." As a result, the Court ordered that Platinex was entitled to begin Phase One of its drilling program on June 1, 2007.

The Court reserved its rights, and the rights of the parties upon submission to the Court, to make further orders or amendments as necessary in order to ensure the appropriate level of consultation is achieved. The Court clearly indicated its continued role in monitoring the consultation process and ordered that at the end of Phase One of the drilling program, and prior to any extended program or further drilling being undertaken, the parties could apply to the Court for further direction relating to ongoing consultation.

A copy of both the MoU and CP are attached to the May 22 decision as schedules.

Archaeological Sites and Spiritual Practices

The Court provided guidance to the parties by commenting on certain aspects of the CP. For example, in respect of an obligation in the CP that Platinex retain an archeologist to work with the KI community regarding the identification and protection of archaeologically significant sites within the proposed drilling area, the Court stated that if KI is not satisfied with either the designation of the site or the size or location of a buffer zone, it may apply for further direction from the Court. Additionally, the Court granted leave to KI to make further submissions on the issue of the negative impact that mining activities may have on KI community spiritual practices.

Funding and Community Benefit Issues

The Court granted additional time to reach agreement as to what level of funding Ontario and Platinex are reasonably required to provide KI in respect of the consultation process, giving more time to the parties to come to an agreement on this issue. However, G.P. Smith J. commented that "the issue of appropriate funding is essential to a fair and balanced consultation process, to ensure a level playing field." The Court also did not make any order in respect of the establishment of a community benefit fund; rather, the Court set out the positions of the parties and invited them to apply and make further submissions if they are unable to come to an agreement on this issue.

Commentary

This decision, together with the two preceding decisions in this matter, are noteworthy for the active role that the Court has assumed in monitoring the ongoing consultation process between the parties in this particular case. The Court order affirmed the steps taken by Platinex and Ontario in consulting with KI and authorized Platinex to continue its mining activities, providing further direction regarding the nature of consultation required in respect of the exploration stages of resource exploration projects. The decision clearly recognizes that both the Crown and First Nations are required to participate actively in the consultation process, and that where the parties cannot agree, the courts will be willing to step in and, if adequate consultation has occurred, allow projects to proceed.

The Court also emphasized the value of the parties continuing their negotiation of the consultation process in pursuit of the reconciliation of their differing views and concerns, and encouraged the parties to "…engage in meaningful, good faith discussion with a view to gaining an appreciation of the perspective of the other and achieving a long-term relationship based upon trust, respect, and understanding."

While this interventionist approach was likely necessary because of the unique facts of this case, and despite seeking to uphold the principles of consultation and reconciliation, this series of decisions, if proliferated, could undermine these principles in the long term if applied generally. If every resource project in Canada required an "on call" judge to follow consultative activities and provide guidance on request, the strain on the judicial system would be unsustainable. Practically speaking, one can envision this burden on the judiciary leading to delays that would render many projects uneconomic, thereby causing greater uncertainty for the market and business generally.

An interventionist approach that makes the courts available at every turn may facilitate consultation on a case-by-case basis, but could ultimately threaten the integrity of the doctrine of consultation by minimizing the incentive of each party to truly seek to understand the other’s concerns: The Supreme Court of Canada’s decisions on consultation, to date, all focus on a degree of deference to the Crown to be able to govern, so long as it is acting honourably and reasonably.

Accordingly, it will be interesting to see at what point G.P. Smith J. extricates himself from oversight of Platinex’s project. In the short term, he may be providing some much needed guidance to the parties in respect of a challenging situation. However, in the long term, the creation of a possible precedent for a consultation process with a high degree of judicial intervention is not sustainable and could undermine the principles underlying the Crown’s duty to consult. While these decisions are interesting and notable, they should, in the long term, be the exception and not the rule.