The Supreme Court of Canada dismissed a leave application filed by two Alberta First Nations in regards to a 2015 order of the Federal Court, upheld by the Federal Court of Appeal in September 2016, which had dismissed their actions on limitation grounds.
The underlying litigation concerns oil royalties between 1973 and 1985, and whether the plaintiffs are entitled to compensation due to the “made-in-Canada” oil price program established under the National Energy Program. The claim of the Samson Band was filed in September 1989, and the companion claim in Ermineskin was filed in May 1992. Canada applied for summary dismissal based on statutory and equitable limitation periods.
The summary dismissal application was allowed by the Federal Court: 2015 FC 836. Russell J. held that Alberta limitations legislation applied, rather than the Ontario statute (as argued by the plaintiffs). Citing cases such as Wewaykum Indian Band v. Canada , 2002 SCC 79 and Canada (Attorney General) v. Lameman, 2008 SCC 14 [sub. nom. Papaschase Indian Band v. Canada], Russell J. held that limitations legislation, as well as the principles of laches and acquiescence, are "applicable to claims against Canada even where the rights at stake are constitutionallyprotected treaty and Aboriginal rights". The Court held that the Lameman decision left "no doubt that the Supreme Court of Canada felt there was no issue of constitutionality when it comes to applying limitations legislations to claims involving Aboriginal and treaty rights". The exceptions to this rule, as discussed in Manitoba Métis Federation Inc. v. Canada (Attorney General), 2013 SCC 14, were not applicable here. Russell J. also held that limitation periods do not expunge or extinguish rights, but only bar remedies. Alberta legislation establishes a six-year limitation period. The plaintiffs were aware of the facts by 1978, and made a strategic choice not to bring a claim at that time. The Court rejected the argument that limitations legislation should not apply due to factors such as the Honour of the Crown. Such a result would make the plaintiffs immune from limitation periods, and recognize a right to sue on their treaty rights at any time that they please.
In September 2016, the Federal Court of Appeal upheld this decision: 2016 FCA 223. The majority held that the plaintiffs had not demonstrated any error of law or any palpable and overriding error of fact or mixed fact and law in the Federal Court's reasons. Webb J.A. dissented in part. He would have allowed the Samson Band's appeal in relation to the issue of whether Canada had improperly or illegally taxed the property of Samson.
Such a claim would be restricted to only the amounts collected by Canada within the six year period prior to the commencement of the action by Samson.
A summary of the Samson case found on the Supreme Court of Canada's website was as follows:
Constitutional law — Aboriginal law — Treaty rights — Limitation of actions — First Nation suing Crown for infringement of treaty rights and breaches of fiduciary duties with respect to oil and gas royalties — Courts below granting Crown's motion for summary judgment and dismissing claim as being statute-barred — Provincial limitation periods incorporated by reference into federal law and applicable to treaty claims — Whether statutory limitation periods are applicable to the constitutionally-protected rights of First Nations in a manner that does not promote reconciliation between First Nations and the Crown — Whether Canada is entitled to extinguish constitutionally-protected treaty rights through the wholesale application of generic limitation periods — Whether Canada has the obligations of a de facto common law trustee with respect to oil and gas royalties and for the purposes of applying limitation periods — Whether the applicants are precluded from challenging all aspects of federal oil and gas legislation, including those that continued to be applicable after the filing of the applicants' statement of claim, on the basis that the applicants' claims "crystallized" upon the initial passage of legislation — Whether it is appropriate, in a summary judgment motion, to rule on the merits of the claim when the only issue before the Court was whether the claims were made within the applicable limitation period — Federal Courts Act, R.S.C. 1985, c. F-7, s. 39 — Indian Oil and Gas Act, R.S.C. 1985, c. I-7, s. 4 — Limitation of Actions Act, R.S.A. 1980, c. L-15, s. 4(1) — Constitution Act, 1982, s. 35
In 1946, the applicant First Nation surrendered their mineral interests in their reserve to the Crown, which permitted the Crown to grant leases to oil and gas companies, who then paid royalties to the Crown in trust for the First Nation. In 1973, Canada developed a national strategy to deal with the effects of rapidly rising international oil prices, including the implementation of an export tax (and later, an export charge) on oil export sales. The tax or charge was levied on any exported oil produced on the reserve between 1973 and 1985. In 1989, the First Nation brought an action in Federal Court asserting a number of claims against Canada arising out of these facts, alleging that the regulated price regime constituted, among other things, a breach of the Crown's trust and fiduciary duties, as well as infringements of treaty rights and obligations. The federal Crown brought a motion for summary judgment, seeking the dismissal of the claim as being time-barred by a six-year statutory limitation period.
The Federal Court granted the Crown's motion for summary judgment against the First Nation, on the basis that their claim raised no triable issue in light of the application of statutory limitation periods. A majority of the Federal Court of Appeal dismissed the First Nation's appeal, finding no error in the Federal Court's reasoning and decision. In the Court of Appeal's view, the motions judge properly applied the existing jurisprudence which confirms that limitation periods are applicable to all Aboriginal claims, including those based on infringements of treaty rights. In partial dissent, one judge of the Court of Appeal would have allowed the First Nation's appeal to the extent of permitting its claim that Canada improperly collected a tax to continue, in relation to amounts collected in the six years prior to the First Nation filing its statement of claim.
The Supreme Court of Canada dismissed the leave application, with Madame Justice Côté dissenting.