Crown Delegation of Consultation Responsibilities

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1 December 2012 Aboriginal Law Section Crown Delegation of Consultation Responsibilities Peter Landmann* Governments delegate significant Aboriginal consultation responsibilities to proponents and give every sign of continuing to do so. Criticism by some developers and Aboriginal communities of the process and extent of Crown delegation has highlighted the lack of clear judicial guidance on this issue. Practitioners, governments and lower courts are uncertain as to what can be delegated, what cannot be delegated, and what delegation mechanisms, if any, are required to effect delegation. For reasons discussed below, Crown delegation of the day-to-day, operational aspects of consultation is lawful and, in practice, necessary to fulfill the Crown duty to consult. However, clarification of the law would assist Aboriginal communities, proponents and the Crown in carrying out their respective roles more smoothly and effectively. Procedure and Substance Uncertainty persists even about the following issues that have been settled by the Supreme Court of Canada. First, responsibility for fulfilling the legal duty to consult and accommodate ( DTC ) rests with the Crown and is not delegable to non-crown entities. Second, something called the procedural aspects of consultation ( PAOC ) may be delegated by governments to project proponents. 1 (Given the different principles that apply, it is very important to distinguish between delegation of the legal duty and of the PAOC.) Third, the DTC can be borne by tribunals (presumably because tribunals are government), but under administrative law principles a tribunal has only those consultation powers that are expressly or implicitly conferred upon it by statute. 2 This state of the law leaves unresolved the following two questions that arise daily as governments and proponents attempt to fulfill the DTC on the many development projects that potentially trigger the duty to consult: What are the POAC?, and What, if any, mechanisms are necessary to delegate PAOC to proponents? 1 Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73, [2004] 3 S.C.R. 511 [ Haida ] at para Rio Tinto Alcan Inc. v. Carrier Sekani Tribal Council, 2010 SCC 43, [2010] 2 S.C.R. 650 [ Rio Tinto ] at paras A tribunal can be delegated (i) the entire DTC (presumably including the PAOC), (ii) a duty to consider the adequacy of consultation in its decision, or (iii) no consultation responsibilities at all. However, according to the British Columbia Court of Appeal [ BCCA ] in Neskonlith Indian Band v. Salmon Arm (City), 2012 BCCA 379, [2012] B.C.J. No [ Neskonlith ], municipalities are not the Crown and cannot therefore bear the legal DTC.

2 2 On the first question, terms such as operational aspects or on-the-ground aspects are sometimes used to describe the PAOC, but these remain unspecific. In the absence of a judicially settled list of PAOC, governments have attempted to identify the PAOC themselves. One possible approach is to identify the aspects of consultation that are clearly substantive and cannot be delegated it should follow that other aspects are procedural and delegable. The following consultation tasks are substantive because they involve either determining the scope of consultation required, or evaluating the adequacy of the consultation and accommodation carried out, and are therefore matters that should be reserved exclusively to the Crown: determining whether the duty to consult is triggered, identifying the communities to which the Crown owes a consultation duty, any determination of the required depth of consultation based on an assessment of the strength of Aboriginal claims and the adverse impact of the project, determining prior to a decision to proceed with the project whether the consultation undertaken has been sufficient, and determining what accommodation, if any, is required. If the above proposed list is exhaustive (as intended), or at least close to an exhaustive enumeration of the substantive, non-delegable aspects, other aspects of consultation should be procedural and delegable to proponents. These can include, for example: notifying Aboriginal communities and providing them project information, considering reasonable requests for capacity funding, meeting with the communities, receiving community input about possible adverse impacts on rights, keeping consultation records, relaying community feedback to the Crown, and proposing accommodation measures to the communities and the Crown. How to Delegate How is delegation of these PAOC to proponents accomplished? Although express delegation does occur, sometimes the delegation must be inferred from the conduct of the Crown and the proponent. Typically, the Crown action triggering the DTC is a decision to grant a permit or other project approval. The power to approve is constrained by the obligation of the Crown decision-maker to respect common law constitutional constraints like the DTC 3 (unless the decision-maker is a tribunal lacking the necessary legislative authority). If the government has not completed the PAOC itself which it will normally have not the approval cannot be issued absent the PAOC having been carried out by the proponent. The proponent faces rejection of its application if it applies without a record demonstrating that the PAOC were completed, which is a powerful incentive for proponents to assume the PAOC themselves. 3 Beckman v. Little Salmon/Carmacks First Nation, 2010 SCC 53, [2010] 3 S.C.R. 103 [ Beckman ] at para. 48.

3 3 In the scenario described above there may be little or nothing else one can point to as having effected a delegation of PAOC to the proponent. Absent an express delegation instrument or a Crown letter to the communities indicating it has delegated the PAOC, it may not even be clear to the communities that the proponent is consulting them in order to assist the Crown to fulfill its constitutional DTC. 4 Furthermore, in Haida, the Supreme Court issued the following warning against conferring unstructured discretion on proponents, arguably expressing a preference for explicit delegation of PAOC: 5 It is open to governments to set up regulatory schemes to address the procedural requirements appropriate to different problems at different stages, thereby strengthening the reconciliation process and reducing recourse to the courts. As noted in R. v. Adams at para. 54, the government may not simply adopt an unstructured discretionary administrative regime which risks infringing aboriginal rights in a substantial number of applications in the absence of some explicit guidance. It should be observed that, since October 2002, British Columbia has had a Provincial Policy for Consultation with First Nations to direct the terms of provincial ministries and agencies operational guidelines. Such a policy, while falling short of a regulatory scheme, may guard against unstructured discretion and provide a guide for decision-makers. Given also Rio Tinto 6 and Neskonlith 7, which reiterated that tribunals and municipalities can only carry out consultation to the extent permitted by their enabling legislation, does it follow that the delegation of PAOC to non-crown proponents likewise requires some kind of formal, even statutory, mechanism? Rio Tinto and Neskonlith are distinguishable because they deal with specific creatures of statute and whether these can bear the legal DTC themselves, an issue governed by administrative and municipal law principles. The legal constraints on project proponents carrying out the PAOC are different: there is little doubt that the corporate objects of virtually all project developers include capacity to carry out on-the-ground consultation activities. It is instructive that the Supreme Court in Haida considered a provincial policy document as potentially sufficient to guide the delegated consultation activities of proponents. 8 This is far from the kind of express or implied legislative authority that is required to confer on a tribunal or a municipality the legal responsibility to fulfill the DTC. Plainly, it is lawful to delegate PAOC through less formal or explicit mechanisms. 4 While certainly good practice, it may not necessarily be a requirement to advise communities that consultation is being conducted as part of an effort to fulfill the Crown s DTC (Taku River Tlingit First Nation v. British Columbia (Project Assessment Director), 2004 SCC 74, [2004] 3 S.C.R. 550 [ Taku ] and Beckman, supra, note 3). The contrary view, expressed by the British Columbia Superior Court in Halalt First Nation v. British Columbia (Minister of Environment), 2011 BCSC 945, [2011] B.C.J. No (on appeal to the BCCA) at paras. 73, , does not appear sustainable in light of Taku, Beckman and also, by analogy, Neskonlith (at para. 88). 5 Supra, note 1 at para Supra, note 2. 7 Neskonlith, supra note 2 at paras Haida, supra, note 5. For other examples see para. 53.

4 4 The Supreme Court s comments in Haida on delegation, including its warning against conferring unstructured discretion, must also be read together with its decision in Beckman. 9 The significance of Beckman is its reconfirmation that the purpose of the duty to consult is to ensure honourable Crown conduct; so long as the Crown conduct is honourable overall it satisfies the constitutional requirement. It should follow from Beckman that, if the Crown fulfills its substantive obligations correctly and the proponent carries out the PAOC reasonably, 10 the existence or lack of an express delegation mechanism is at most a technicality that does not determine whether or not the duty is met. 11 This approach does not leave unaddressed the Supreme Court s concern in Haida about granting unstructured discretion to meet a constitutional imperative. As discussed above, the Crown action triggering the DTC is typically a permitting or approval process. Such a process does not risk infringing aboriginal rights in a substantial number of applications. To the contrary, proponents are systematically constrained by the Crown decision-maker s evaluation, at the time of permitting or approvals, of proponents onthe-ground consultation activities undertaken on behalf of the Crown. If the PAOC are not carried out reasonably, approvals must be denied or issued with conditions. Governments do nonetheless sometimes adopt express delegation mechanisms. These can be very helpful to the consultation process by articulating in detail the respective roles and responsibilities of the Crown and the proponent. Examples of express delegation range from a letter to the proponent setting out a list of communities to consult along with the Crown s expectations of the proponent, a memorandum of understanding, terms in a contract between the Crown and the proponent, consultation guidelines, regulations, to a full blown legislative regime. The Ontario government has employed all of these approaches in various situations at various times. 12 Too Much Delegation? A few industry proponents have expressed the view that they should not have to bear the costs of carrying out PAOC. This sentiment is understandable since the consultation activities identified above as delegable can constitute the heavy lifting of consultation. They are time and resource-intensive and may entail considerable expense for developers, cutting into profits. Likewise, some Aboriginal communities prefer consultation by government rather than by project proponents carrying out delegated PAOC. This preference reflects their desire for direct government-to-government relationships and a focus on the historic relationship between the Crown and Aboriginal communities which underlies the principle of honourable Crown conduct and the DTC. 9 Supra, note On standards of review see: Haida, supra, note 1 at paras 60-63; Rio Tinto, supra, note 2 at paras , 78; Beckman, supra note 3 at 48, Salmon Arm, supra, note 2 at See also Neskonlith, supra note 2 at para Examples of statutory and regulatory approaches include Mining Act, R.S.O. 1990, c. M.14; O. Reg. 308/12, Exploration Plans and Exploration Permits; O. Reg. 359/09, Renewable Energy Approvals.

5 5 Governments delegate the PAOC because they lack the human and financial resources to carry out on-the-ground consultation on numerous projects in the mining, energy, forestry, transportation and real estate development sectors. Although some Ontario ministries with regional offices, notably the Ministry of Natural Resources and the Ministry of the Environment, do engage in some direct consultation, and several ministries have opened Aboriginal relations units to handle DTC issues, even managing the substantive, non-delegable aspects of Crown consultation is a major task. For governments to assume the PAOC across the board would require a significant increase in expenditure, and in the current environment of fiscal restraint it is unlikely that there will be any increase in government activity in this area. Even if public resources were available, taxpayers might well ask why costs attributable to development projects should be paid out of the public purse rather than by the developers who stand to profit. Indeed, most proponents accept that carrying out the PAOC is a cost of doing business to be anticipated in project budgets. Consultation also usually works better for Aboriginal communities when the proponent is directly involved. Most proponents have more knowledge than government officials about their own projects, their impacts, available means of impact mitigation and potential accommodation options. It is appropriate that they discuss these matters directly with the communities affected, which also frequently possess intimate local and traditional knowledge which can be put to good use by the proponent in mitigating project impacts. Interactions that start because the proponent has been delegated the PAOC, can develop into improved longer term relationships including an increasing number of business partnerships. Everyone benefits from improved relations between local industries and their Aboriginal neighbours. Of course, there will be times when the proponent fails to carry out the delegated PAOC adequately or the proponent-community relationship breaks down, at which point the Crown can exercise its ability to supervise, intervene or reassume the PAOC as appropriate. Is there too much delegation of the PAOC by the Crown? No. Delegation imposes some of the costs of consultation on the primary financial beneficiaries of the project. It puts proponents and Aboriginal communities together at the table, promoting better relations. What governments can do is ensure that they carry out the substantive aspects of consultation rigorously, efficiently and in a timely and internally coordinated manner. This includes ensuring that the consultation activities of the proponent meet the reasonableness standard, through Crown review at the project approval stage or, as needed, through periodic supervision prior to approvals. Governments should also listen to the concerns of Aboriginal communities and proponents about the consultation process and be prepared to make improvements. Since delegation will likely remain a central feature of consultation in Ontario, all parties the Crown, communities and proponents will benefit from cooperating to make it work. *Senior Counsel, Legal Services Branch, Ontario Ministries of Energy and Infrastructure. The views expressed herein are those of the author and are not necessarily shared by the Government of Ontario.