Overview

On November 22, 2012, the B.C. Court of Appeal allowed the appeals of the Province and the District of North Cowichan in Halalt First Nation v. British Columbia, 2012 BCCA 472, setting aside the lower court’s order (2011 BCSC 945) which had stayed the operation of the Chemainus Wells Project pending further consultation and accommodation. The Judgment of the Court of Appeal can be found here and the Bulletin on the Supreme Court decision can be found here.

Background

The Chemainus Wells Project (the “Project”) originally consisted of the installation of three pumps along the banks of the Chemainus River near the town of the same name on Vancouver Island. Due to turbidity problems with the town’s drinking water supply, the District of North Cowichan (the “District”) wanted to draw from the aquifer below the river on an as-needed basis. The Project had the potential for significant adverse effects, which triggered the requirement for an environmental assessment certificate (the “Certificate”) under the Environmental Assessment Act, S.B.C. 2002, c.43. In addition, although the pumps themselves were located on fee simple land owned by the District, the river and the aquifer run through a reserve of the Halalt First Nation (the “Halalt”). This triggered the Crown’s duty to consult the Halalt in relation to the environmental assessment process.

From the beginning of the environmental assessment process in 2003 until its conclusion in 2009, the Project went through several modifications. Initially the District proposed year-round pumping, followed by a modified proposal for summer pumping on an as-needed basis, followed by the final proposal for winter pumping only. These modifications arose in conjunction with various environmental reports, as well as the Crown and the District’s consultation with the Halalt. The Halalt were not consulted about the proposed modifications to the scope of the Project before these modifications were made. In September of 2009, after the Minister had issued the Certificate and the Project had received approval, the Halalt filed a judicial review application alleging a failure to adequately consult them and accommodate their interests, and seeking a stay of operations of the Project.

Claim Assessment and Adequacy of Consultation

The Court of Appeal set aside the Supreme Court’s findings on the inadequacy of consultation and the failure to conduct a strength of claim assessment.

The lower court had criticized the Crown for not providing the Halalt with a formal assessment of the strength of its title to the aquifer. The Court of Appeal disagreed, confirming its earlier decision in Neskonlith Indian Band v. Salmon Arm (City), 2012 BCCA 379, in which it found that a lack of a formal strength of claim assessment does not necessarily undermine the adequacy of consultation. Here, even though the Crown had doubts as to the strength of the Halalt claim to title, its engagement in deep consultation meant that it was unnecessary to conduct or provide the Halalt with a formal strength of claim assessment.

The Court of Appeal also disagreed with the lower court finding that the level of consultation had been inadequate. First, the Court of Appeal found that the Crown had consulted on its initial proposals for year-round and specific summer pumping- it was the consultation on these proposals that resulted in the modified final proposal for winter-only pumping. Once the proposal was modified, the Crown had no obligation to consult on the earlier plans. There was also no obligation that the Halalt be consulted on the implementation of the modifications themselves – consultation was only required on the proposal that would eventually be put forward for approval.

Second, the Court of Appeal found that there had been adequate consultation on the modified final proposal. Key to this finding was the concession of the Halalt that if the District wanted to begin using the wells in the summer, this was beyond what was approved in the Certificate, and would trigger the Crown’s duty to consult anew. Although the Court agreed that there were instances in which consultation might have been undertaken differently, the test only required a consideration of whether deep consultation was achieved. Specifically, the Court of Appeal found that although there were instances in which the Halalt had been provided information later than the other parties involved, they still received this information and were consulted on it prior to approval of the Project. In addition, although the Crown on occasion had delayed its consultations with the Halalt until after the District and the Halalt had their own negotiations, the Crown went on to fulfill its duty to consult following these private negotiations.

Finally, the Court of Appeal reiterated the principle that while the Crown could not delegate its ultimate responsibility to consult to private parties it could, as part of the environmental assessment process, require a proponent to consult and report on matters specified in the process. The Court also acknowledged there was a practical benefit to both the District and the Halalt in engaging in negotiations without the Crown.

Reasonableness of Accommodation

The Court of Appeal also set aside the Chambers decision on the adequacy of accommodation, finding that the Crown had met its duty. In particular, it found that:

  • Modifications to the Project had been made in response to the consultations;
  • There was no need to continue consultations on the earlier proposals once the modifications were made;
  • There was no evidence that the Crown had received advice indicating that the final modified proposal would result in adverse environmental impacts;
  • The Crown turned its mind to the earlier proposals asking for year-round and summer pumping;
  • Consultation did not require the Halalt to participate in monitoring of the Project, only that they be provided with the monitoring results; and
  • The Crown’s refusal to consider financial compensation was not unreasonable given policy objectives and inherent uncertainties in the natural environment.

Conclusion

The Court of Appeal confirmed its earlier decisions in Neskonlith and Adams Lake – the Crown’s failure to conduct a strength of claim analysis is not fatal to the consultation process. Here, where the Crown conceded that the consultation required is deep, it is the extent of consultation that is important, not the strength of claim assessment itself.

In addition, the decision affirms what the Supreme Court of Canada made clear in Rio Tinto: that it is the current proposal, decision or conduct that forms the scope of consultation; once a proposal is modified, the earlier plans are irrelevant. It also reinforces the principle from Haida that although the Crown can delegate procedural aspects of the duty, the Crown retains ultimate responsibility to ensure that there is proper consultation.

Finally, the Court found there is no requirement on the Crown to offer financial compensation in order to accommodate potential adverse effects to an Aboriginal group’s asserted interests, and in this case, it was not unreasonable for the Crown to refuse to consider compensation to the Halalt.