The Federal Court of Appeal issued its ruling quashing the approvals for the proposed expansion of the Trans Mountain Pipeline.[1] This bulletin explains the key insights regarding the Indigenous consultation process from the Court’s decision, including how the government team must carry out the consultation.

The Court’s decision was released August 30, 2018. It focuses on the National Energy Board (NEB) report that recommended that the Governor in Council (Federal Cabinet) approve the expansion of the Trans Mountain Pipeline. The Cabinet approved the expansion project, and shortly thereafter Indigenous groups and environmental groups filed a number of applications for judicial review. These groups alleged that the NEB Report was flawed arguing that:

  • The NEB’s process was not procedurally fair because, among other things, the NEB failed to hold an oral hearing or provide sufficient reasons;
  • The NEB failed to consider issues, including the risks and impacts of the project to the City of Burnaby and alternative means of carrying out the project, before recommending approval of the project;

Ultimately, the Court found that most of the alleged flaws asserted with respect to the NEB’s process and findings were without merit, but that the NEB made one critical error.

Specifically, the court faulted the NEB for defining the scope of the project under review so as not to include increased tanker traffic. The limited scope adopted by the NEB, the Court explained, prevented the Federal Cabinet from making a decision based on all relevant factors. As the Federal Court of Appeal explained:

The unjustified exclusion of Project-related marine shipping from the definition of the Project thus resulted in successive deficiencies such that the Board’s report was not the kind of “report” that would arm the Governor in Council with the information and assessments it required to make its public interest determination and its decision about environmental effects and their justification.[2]

Although the NEB did not include marine shipping in the definition of the project, it did in fact conduct an assessment of the potential effects of marine shipping, concluding that the Project would result in significant adverse effects to the Southern resident killer whale. The Court concluded that the assessment was not sufficient because, in the Court’s view the NEB did not fully consider all of the potential measures to mitigate the impacts to killer whales and because the NEB’s report did not contain a discussion of the limits on the legal authority of the NEB to impose requirements on marine shipping.

The Court also faulted the NEB’s consultation with Indigenous groups. The Court concluded that the NEB selected an appropriate consultation framework but failed to properly implement that framework.[3] The Court found that the NEB had failed to engage in a meaningful “two-way dialogue” when consulting with the Indigenous groups affected by the project noting:

The Supreme Court’s jurisprudence repeatedly emphasizes that dialogue must take place and must be a two-way exchange. The Crown is required to do more than to receive and document concerns and complaints.[4]

The Court found problems with the composition of the NEB’s consultation team. As the Court explained:

The inadequacies of the consultation process flowed from the limited execution of the mandate of the Crown consultation team. Missing was someone representing Canada who could engage interactively. Someone with the confidence of Cabinet, who could discuss, at least in principle, required accommodation measures, possible flaws in the Board’s process, findings and recommendations and how those flaws could be addressed.[5]

As a result of these NEB report and consultation errors, the Court quashed the project approvals.

This case highlights the importance of conducting consultation with Indigenous groups carefully including: not artificially limiting what may be discussed; not rushing the consultation process; listening, considering and responding to all points raised; and ensuring the consultation record and report reflect what was dealt with during the process. It is crucial to the resulting approvals that the consultation process be properly conducted.