Environmental, Indigenous and Natural Resources Blog

On October 28, 2010, the Supreme Court of Canada issued a unanimous judgment in Rio Tinto Alcan Inc. and British Columbia Hydro and Power Authority v. Carrier Sekani Tribal Council, 2010 SCC 43, affirming the decision of the British Columbia Utilities Commission (the “Commission”) to accept the 2007 Electricity Purchase Agreement between BC Hydro and Rio Tinto Alcan Inc. for filing.  The decision is important for what it says about – (1) when the Crown has a duty to consult with Aboriginal groups—and when it does not; and (2) the role of administrative tribunals in carrying out consultation.

In the 1950s, Alcan (now Rio Tinto Alcan Inc.) dammed the Nechako River in northwestern British Columbia for the purposes of generating power to support aluminum production.  Since 1961, however, Alcan has sold its excess power to BC Hydro, a Crown Corporation, under Energy Purchase Agreements (“EPAs”).  The 2007 EPA is the latest such agreement.

The CSTC First Nations claim the Nechako Valley as their ancestral homeland, and the right to fish in the Nechako River.  As was the practice at the time, they were not consulted about the 1950s dam project.  They claimed, however, that the 2007 EPA for the purchase and sale of the power generated by the project should be subject to consultation.  The 2007 EPA was subject to review before the Commission, which was charged with determining whether the purchase of electricity was in the public interest.  The Commission had the power to declare a contract for the sale of electricity unenforceable if it found that it was not in the public interest.

The Commission held a hearing and concluded that the EPA would not affect water levels in the Nechako River.  The Commission assumed the historic infringement of Aboriginal rights, Aboriginal title, and a failure by the government to consult, but concluded that “more than just an underlying infringement” was required.  Since the CSTC had failed to demonstrate that the 2007 EPA would “adversely affect” their Aboriginal interests, the Commission concluded that it did not trigger the duty to consult and that accordingly it did not need to consider further evidence on consultation.  The British Columbia Court of Appeal allowed the appeal.  Alcan and BC Hydro then appealed to the Supreme Court of Canada.

A unanimous Supreme Court applied the three-part test set out in Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73 for determining whether consultation was required: (1) the Crown’s knowledge, actual or constructive, of a potential Aboriginal claim or right; (2) the contemplated Crown conduct; and (3) the potential that the contemplated conduct may adversely affect an Aboriginal claim or right.  Regarding the second element (contemplated conduct), the Court confirmed that such action is not confined to government exercise of statutory powers nor confined to decisions or conduct which have an immediate impact on lands and resources.  Rather the duty to consult extends to “strategic, higher level decisions” that may have an impact on Aboriginal claims and rights—even if these decisions have no “immediate impact on the lands and resources.”  Regarding the third element (adverse effect), the Court held that there must be a causal relationship between the proposed government conduct and a potential for adverse impacts on pending Aboriginal claims or rights.  The Court was clear that – (1) “[p]ast wrongs, including previous breaches of the duty to consult, do not suffice”; (2)“[m]ere speculative impacts…will not suffice”; and (3) “[t]he adverse effect must be on the future exercise of the right itself; an adverse effect on a First Nation’s future negotiating position does not suffice.”  Thus, the duty to consult is confined to adverse impacts flowing from the current Crown proposal at issue — not to larger adverse impacts of the project of which it is a part.  The subject of the consultation is the impact on the claimed rights of the

The Court also found that a tribunal’s duty to consider consultation depends on the scope of the mandate conferred by the legislation that creates the tribunal.  If the tribunal structure set up by the legislature is incapable of dealing with a decision’s potential adverse impacts on Aboriginal interests, then the Aboriginal peoples affected must seek appropriate remedies in the courts.  In this case, the Court concluded that the Commission may evaluate the adequacy of consultation, but was not empowered to directly engage in consultation.  The Commission was correct in concluding that an underlying infringement in and of itself would not constitute an adverse impact giving rise to a duty to consult.

For all of these reasons, the Court allowed the appeal and confirmed the decision of the British Columbia Utilities Commission approving the 2007 EPA.