The Supreme Court of Yukon made an order quashing a Decision Document made by the Director of Mineral Resources on September 5, 2012 which had allowed a mining project to be considered for regulatory approval. The Director had rejected the recommendations contained in a July 2012 report that the project not proceed due to serious adverse impacts on the Chisana caribou herd. The Director rejected the basis of those recommendations. The Court concluded that the Director breached his duty to consult and accommodate the petitioner White River First Nation. The consultation process must be more than a venue to allow the First Nation to blow off steam. The Director failed to disclose the Yukon Government’s views of the July 2012 report and the data underlying it, so as to give the petitioner a meaningful opportunity to challenge such views. In consequence, the process was not fair and did not comply with the honour of the Crown. The Court ordered that there be further consultation regarding the Decision Document.

In March 2012, the respondent Tarsis Resources Ltd. applied for a 5-year Class III Mining Land Use Approval permit for the White River – Quartz Exploration Project. Tarsis is an early stage exploration company that prospects for gold, silver, copper and base metal deposits. It does not develop mines, but options or sells the potential deposits to others. Tarsis staked 335 claims in the White River area in June 2010. The proposed White River project covers 64 of those claims.

The White River First Nation (WRFN) is a small community is the southwestern corner of Yukon, near the Alaskan border. Until 1991, Canada had considered the WRFN to be part of the Kluane First Nation. The WRFN has not entered into a Final Agreement with Canada and Yukon, and treaty negotiations ended in 2005. The WRFN asserts aboriginal rights and title to all of its traditional territory, which encompasses 5,000 square miles.

The White River project pursued by Tarsis falls within the alleged traditional territory of the WRFN. The rights of the WRFN are safeguarded by the common law constitutional duty to consult, as well as section 74(2) of the Yukon Environmental and Socio-Economic Assessment Act (YESAA) The WRFN was fully engaged in the environmental and socio-economic assessment (EA) for the White River project. Tarsis funded an initial review by a consultant firm. Tarsis incorporated some of the recommendations of the consultant into its YESAA proposal, but did not accept the recommendation to fund extensive baseline studies.

Tarsis made significant efforts to inform the WRFN of its activities, even though it had no duty to consult during the Class I phase. (Such activities occurred before the Ross River decision of the Yukon Court of Appeal in December 2012). The relationship between Tarsis and the WRFN broke down after Tarsis submitted the Class III application in 2012, and rejected the recommendation for baseline studies. Tarsis and the WRFN fundamentally disagree on the purpose and scope of the EA.

The scope of activities under the proposed Class III exploration program for the White River project were extensive, but significantly less than what could be applied for under the legislation. The application submitted by Tarsis included a number of mitigation measures, based in part on advice from a Yukon wildlife biologist. The view of the biologist was that the exploration activities did not present a threat to the Chisana caribou herd.

The Chisana caribou herd was the focus of the EA assessment and the decision under review. The current management plan for the herd was approved by Yukon, the WRFN, the Kluane First Nation, and U.S. authorities. The Chisana herd is a small international herd that experienced a long and steady decline during the 1990s, falling from a population of 1,900 to 315. It was designated as “specially protected” in 2002. The management plan sets out eight management principles, including that management must use “the best available information and respect traditional, local and scientific knowledge”. Also, consistent with the precautionary principle, caution must be exercised to avoid potential effects of human activities.

Project proposals under the YESAA are submitted to a Designated Office or to the Executive Committee depending upon the activities proposed. Section 39 of the YESAA states that the Designated Office shall give “full and fair consideration” to scientific information, traditional knowledge and other information. Section 42 lists other factors that must be taken into account, such as cumulative environmental effects, alternatives to the project, and the rights of Yukon Indians. Section 56 concerns the recommendations of the Designated Office to the decision body.

In July 2012, the Haines Junction Designated Office submitted a 79-page assessment (the Evaluation Report) in which it recommended that the White River project not proceed due to significant adverse impacts on the Chisana caribou herd. It identified the work areas for the project as being calving areas, and good caribou habitat. There were significant adverse effects that could not be mitigated. Gaps in information about the herd, such as a lack of survey data since 2009, were noted.

Section 74 of the YESAA requires a Decision Body to give full and fair consideration to the scientific knowledge and traditional knowledge provided with the recommendation of the Designated Office. Section 74(2) requires that consultation with First Nations take place. The prescribed period of consultation is 37 days.

Following the delivery of the Evaluation Report on July 30, 2012, the Director had a timeline of 37 days under the YESAA to complete the consultation. A letter was sent to the WRFN mistakenly stating that the White River project had been recommended to proceed. That mistake was corrected. On August 16, the Chief of Mining Land Use contacted Troy Hegel, a caribou biologist and a participant in the Working Group that prepared the 2010-2015 management plan for the Chisana herd. They discussed that the Chisana herd, based on radio telemetry data, was “stable”, there was little or no caribou presence near the main work area of the White River project, and  that there was no presence after mid-September. This discussion was not disclosed to the WRFN until after this judicial review proceeding was commenced.

The consultation meeting between the Director and the WRFN took place on August 21. The Court relied upon fifteen pages of extensive notes submitted by the WRFN, rather than a one-page cryptic summary from the Chief of Mining Land Use. There was no evidence that this meeting dealt with the views expressed by Mr. Hegel on August 16, or any other reason for rejecting the recommendations of the Evaluation Report.

On August 29, the Chief of Mining Land Use emailed a representative of WRFN and stated that the recommendations in the Evaluation Report were not well-founded and did not have a solid evidentiary basis. He advised that there would be further opportunities to explore residual impacts on traditional land use when the project is considered for regulatory approval. He attached a summary document setting out that there is no data confirming a caribou presence at the work area beyond mid-September. The WRFN responded with a strongly-worded letter on August 31 questioning the integrity of the process. There was no response to this letter prior to the release of the Director’s decision on September 5.

In the decision document of September 5, the Director agreed that the White River project may have potential significant effects on the Chisana caribou herd. Rejecting the recommendations of the Evaluation Report, the Director concluded that the effects could be mitigated, and stated that the conclusions in the Evaluation Report were not borne out by telemetry data.

The WRFN sought judicial review of the September 5 decision. The standard of review to assess the scope and extent of the Director’s duty to consult is correctness. The extent of the duty to consult required in this case fell at the stringent end of the Haida spectrum. The Court found that the WRFN had a strong claim to its traditional territory, and there would be significant adverse effects on wildlife and traditional land use and culture.

The duty to consult and accommodate incorporates both procedural and substantive elements. This duty is not discharged simply by providing a venue for Aboriginal groups to be heard. It is also necessary to show that the Crown’s substantive position has been modified as a result of the consultation. This duty is a far more significant constraint than the duty of fairness found in administrative law. Crown action may be justified as long as the process of consultation has been meaningful. Accommodation is not always necessary.

The consultation process after the Evaluation Report is not intended to be “merely a check-in procedure to assess whether the First Nation is satisfied with the Evaluation Report”. A meaningful or genuine consultation requires an exchange of views, giving the First Nation some meaningful input. It must be more than “blowing off steam”.

The Court held that the Director misconceived both the strength of the WRFN’s claim and the extent of the potential adverse impact of the White River project. Given the profound implications, the duty in this case also included a duty to accommodate.

The meeting of August 21, 2012 was not a “far-reaching” discussion as alleged by the respondent Crown. The Director did not reveal any basis at that meeting for rejecting the recommendations in the Evaluation Report. It was only in the August 29 email, approximately one week before the decision, that the Director revealed a basis for rejecting the Evaluation Report. Veale J. commented:

In my view, the process amounted to “tell us what you think of the Evaluation Report but we will not give you any idea where we have problems with it”.

The telemetry data was available to the WRFN, but the Director did not disclose the Yukon Government’s views of it, including the opinion of Mr. Hegel discussed on August 16. In consequence, this was not a fair or meaningful process of consultation. Yukon’s view that there was a “stable” population should have been presented to the WRFN, so as to give them the opportunity to challenge and test the information. Veale J. stated:

A meeting where the determinative issue for one party is not identified makes the “consultation” an opportunity to blow off steam rather than meaningful exploration of the facts and discussion about appropriate accommodation.

The Director was not required to disclose every communication it has had to the WRFN, but there must be at least an opportunity to give an opinion on the data being relied upon to reject the recommendation in the Evaluation Report. The First Nation is entitled to have “a say” on the ultimate policy decision that Yukon is entitled to make.

The consideration by the Director was not “full and fair”. The WRFN should have had the opportunity to put forward a technical expert, challenge the telemetry data, and present their traditional knowledge. Veale J. stated:

Fairness and the honour of the Crown require that the First Nation be given an opportunity and time to put forward their view when the Decision Body, as here, is contemplating a decision completely at odds with the one that was rendered after an in-depth consultation process.

Yukon and Tarsis submitted that the duty to consult is an ongoing process, and there will be further opportunities for input by the First Nation. The Court held that the September 5 decision was a significant step in the permitting process that must satisfy the duty to consult. Shortcomings in the process cannot be addressed on the basis that there will be further consultation. Veale J. stated:

To summarize, I have concluded that the Director has breached his duty to consult and accommodate the [WRFN] by failing to provide a meaningful process to provide feedback on the government’s basis for rejecting the recommendation that the White River Project not proceed. The consultation following a rejection recommendation must be deep and meaningful. While the First Nation has no power to require the Evaluation Report to be accepted, it should have an opportunity to address the government’s basis for rejecting it.

Tarsis submitted that the appropriate remedy in this proceeding should not unfairly prejudice it, since it carried out in-depth consultation with the WRFN and is an “innocent third party” that relied upon the Crown. The Court acknowledged the cost and delay for Tarsis, but held that the submissions of Tarsis fail to take into account the importance and purposes of the YESAA.  Tarsis is a responsible exploration company and its contribution is important, but the participation and involvement of First Nations in the process have a statutory and constitutional dimension that must be respected. A better process, involving a meaningful exchange of views, minimizes the risk of error, and implies respect for the parties and their positions.

The Court therefore made an order that the Decision Document of September 5, 2012 be quashed, and the Director of Mineral Resources proceed to consult with the WRFN pursuant to s. 74 of the YESAA within the same timeline of 37 days. There will be a further meeting with the Director, at Yukon’s expense, to address the Decision Document in deep consultation. The Director may then issue his Decision Document.

http://www.yukoncourts.ca/judgements/supreme/2007/2013_yksc_66_white_river_first_nation_v_yukon_government.pdf