Carrier Sekani Tribal Council v. B.C. (Utilities Commission)1 arose out of a BCUC hearing regarding the approval of an Electricity Purchase Agreement (EPA) between the British Columbia Hydro and Power Authority and Rio Tinto Alcan Inc. (Alcan).

Alcan had developed both an aluminum smelter in Kitimat as well as power facilities in nearby Kemano in order to provide power to their facilities. The construction of the power facilities in the 1950s involved the creation of reservoir as well as the re-routing of the Nechako River, and the Crown granted Alcan the necessary water licences in order to carry out this construction and operation.2 When the power facilities ultimately produced more energy than was required by the smelting facilities, Alcan began to sell excess power.3 In 2007, Alcan entered into an EPA with BC Hydro for the purchase and sale of power. It then applied under s. 71 of the Utilities Commission Act (UCA)4 for a determination that the EPA was in the public interest.

The Carrier Sekani Tribal Council (CSTC) sought to be heard by the BCUC in the s. 71 proceeding on the issue of whether the Crown had fulfilled its obligations to consult with the CSTC and, if appropriate, accommodate the CSTC’s interests, prior to entering into the EPA with BC Hydro.5 The CSTC claimed the construction of the power facilities, the diversion of water, and the creation of a reservoir to service the power facilities were all infringements of the CSTC’s Aboriginal rights and title, and that no consultation in relation to such original infringement had ever occurred.6 In addition, the CSTC claimed that the newly executed EPA posed additional physical impacts on the reservoir and associated watershed, and held the potential to affect CSTC’s Aboriginal interests.7

In deciding whether to hear arguments by the CSTC on the matter, the BCUC accepted submissions from BC Hydro that the EPA would have effectively no impact on the Nechako River, the Kemano River, or the Nechako Reservoir. As a consequence of this finding, the BCUC found that the duty to consult was not triggered, and therefore arguments related to the duty to consult would not be considered.8 The CSTC appealed to the BCCA, which found that the BCUC’s decision was unreasonable and sent the matter of the adequacy of consultation back to the BCUC for consideration.

The Decision

Writing for the unanimous court, Donald J. broke his analysis into three distinct sections. The first two considered whether the BCUC had the power, jurisdiction and duty to decide issues related to the duty to consult. The third considered whether the BCUC’s decision to deny the CSTC the opportunity to present arguments related to the duty to consult was reasonable.

The Power to Decide and Jurisdiction

Donald J. started his analysis by reviewing the power of a tribunal to address matters of constitutional law, and in particular, to address the Crown’s duty to consult. In doing so, Donald J. noted three distinct propositions on which he would comment: (i) the BCUC’s authority to decide constitutional questions (including whether the Crown has discharged its duty to consult with Aboriginal groups); (ii) whether, in considering issues of "public interest," the BCUC was to consider the honour of the Crown and the Crown’s duty to consult; and (iii) the BCUC’s capacity to address issues of consultation.9

In considering whether the BCUC had the authority to determine questions of constitutional law, the BCCA applied the Supreme Court of Canada’s analysis in Paul v. B.C. Forest Appeals Commission).10 In Paul, the Supreme Court held that where the legislation creating a tribunal implicitly or explicitly grants that tribunal the ability to interpret or decide questions of law, the tribunal will be assumed to have the authority to interpret or decide questions of constitutional law.11 The BCCA noted that the UCA implies the BCUC has the authority to determine questions of law ? and therefore had the authority to determine questions associated with the duty to consult.12

Donald J. then considered the construction of s.71 of the UCA, and whether the authority to approve energy purchase contracts under s.71 included the consideration of constitutional issues. In a proceeding before the BCUC under s.71, the BCUC may vary or declare unenforceable any EPA that it determines is not "in the public interest." Section 71(2.1) of the UCA sets out factors that the Commission must consider in determining whether an EPA is in the public interest, none of which explicitly relates to the adequacy of consultation with Aboriginal groups. However, Donald J. stated that a consideration of whether any constitutional duties such as consultation are satisfied in respect of an EPA should form part of the public interest inquiry,13 and expressly noted that the BCUC was the most appropriate form to determine consultation issues in a timely and effective manner.14

The Duty to Decide

Having considered whether the BCUC had the proper authority to determine questions pertaining to the duty to consult, the BCCA also noted that the BCUC had a "duty" to determine consultation issues. Donald J. stated that the BCUC was the only appropriate forum to decide consultation issues in a timely manner, and that as a body to which powers have been delegated by the Crown, the BCUC was bound by the honour of the Crown to provide such decisions on the duty to consult.15

The BCCA specifically noted that no party was suggesting that in the context of a s.71 hearing the BCUC has an independent duty to consult; however, the honour of the Crown did create a duty on the BCUC to "grasp the nettle and decide the consultation dispute."16 Finally, the BCCA noted that the standard of review regarding the BCUC’s decisions relating to consultation is one of reasonableness, not correctness.17

Was the BCUC’s Decision Reasonable?

Having discussed both whether the BCUC has the power to determine questions of a constitutional nature (including questions related to the duty to consult) and whether the BCUC has a duty to decide issues related to consultation, the BCCA turned to reviewing the actual decision by the BCUC. It found that the BCUC’s decision not to consider the issue of consultation within the scope of a full hearing was unreasonable,18 and noted that whether the EPA triggered a duty to consult should be a matter for a hearing on the merits.19 Donald J. noted that the duty to consult is triggered at a low threshold, and that the BCUC’s focus on whether the EPA created any "new physical impacts" deprived the CSTC the opportunity to develop a case for the non-physical impacts included in their application.20 In particular, the BCCA noted that the decision did not deal in any substantive way with the CSTC’s allegations that the EPA perpetuates an historical infringement.21 Importantly, the BCCA states that the "consultation duty is not a concept that lends itself to hard-edged tests. The trigger formula in Haida is to be applied within the proceeding, not on a threshold inquiry."22 The BCCA noted that while the appellants’ concerns "may not carry the day […], the appellants should have had the opportunity to develop them."23

Order

The BCCA, having ruled in favour of CSTC sent the matter back to the BCUC for a hearing on the arguments pertaining to the Crown’s duty to consult.