Regulatory Law Chambers logo

Fort McKay First Nation v Prosper Petroleum Ltd., 2019 ABCA 14

Link to decision summarized

Permission to Appeal – Granted


In this decision, the Alberta Court of Appeal (“ABCA”) considered Fort McKay First Nation (the “First Nation”)’s application for permission to appeal the following AER decisions:

(a) the decision refusing to consider the First Nation’s amended Notice of Question of Constitutional Law, filed pursuant to section 12 of the Administrative Procedures and Jurisdiction Act (“APJA“); and

(b) the decision approving Prosper Petroleum Ltd. (“Prosper”)’s Rigel oil sands project.

The ABCA granted the First Nation permission to appeal on the following question:

• Did the AER commit an error of law or jurisdiction by failing to consider the honour of the Crown and, as a result, failing to delay approval of the Project until the First Nation’s negotiations with Alberta about the Moose Lake Access Management Program were completed?

Background

Prosper was the applicant for a bitumen recovery project (the “Project”) that would be located approximately 64 km from Fort McKay, Alberta. If approved, the Project would operate within 10 km of two of the First Nation’s reserves (known as the “Moose Lake Reserves”). The 10 km area around these reserves is referred to as the “Moose Lake Area” and the First Nation asserted Treaty 8 rights over this area.

The First Nation entered into a “Letter of Intent” with the Government of Alberta (“Alberta”) to develop an access management plan for the Moose Lake Area, known as the Moose Lake Access Management Program (“MLAMP”). The Letter of Intent included a commitment by Alberta to implement the portion of the MLAMP relating to a buffer zone of land within 10 km of the Moose Lake Reserves by September 2015. The First Nation claimed that the purposes of the MLAMP included addressing the First Nation’s concerns about the effect of cumulative oil sands development in the Moose Lake Area.

The AER determined that consideration of the MLAMP was outside its mandate and it was not considered at the approval hearing. The MLAMP was not yet completed or implemented and was the subject of ongoing negotiations. The ABCA noted that when the MLAMP was finalized, it was envisioned that it would be adopted as part of the Lower Athabasca Regional Plan (“LARP”). The LARP is a regional plan under the Alberta Land Stewardship Act. The LARP’s purpose is “to provide a means to plan for the future, recognizing the need to manage activity to meet the reasonably foreseeable needs or current and future generations of Albertans, including Aboriginal peoples.”

After a public hearing, the AER approved the Project, finding it to be in the public interest under the Oil Sands Conservation Act (“OSCA“). However, the Project cannot proceed without Cabinet approval and Cabinet had not yet issued its decision on the Project.

Grounds for Appeal

The First Nation applied for permission to appeal the AER’s two decisions under section 45 of Responsible Energy and Development Act (“REDA“), on the following questions:

(a) Whether the AER committed a reviewable error of law or jurisdiction:

(i) in its interpretation of the notice requirements of the APJA; and

(ii) in its assessment of the types of constitutional questions excluded from its jurisdiction by section 21 of REDA;

(b) Whether the AER committed a reviewable error of law or jurisdiction in its decision to approve the Project: (i) by failing to take into account or comply with the honour of the Crown;

(ii) in its interpretation and application of Treaty 8 rights; and

(iii) by failing to take into account the cumulative effects of development on the First Nation’s Treaty 8 rights.

Test for Permission to Appeal

Permission to appeal may be granted on questions of law or jurisdiction only. When deciding whether to grant permission, the ABCA considers the following:

(a) whether the issue is of general importance;

(b) whether the issues are of significance to the decision itself;

(c) whether the appeal has arguable merit (which may include consideration of the applicable standard of review); and

(d) whether the appeal will unduly hinder the progress of the proceedings.

The burden remains on the applicant to meet this test based on its arguments and the materials it puts before the Court. Mere assertions of importance and arguable merit, for instance, are not sufficient.

ABCA Findings

Declining to Grant the Relief Sought in the First Nation’s Notice of Questions of Constitutional Law

The First Nation submitted the AER erred in two principal respects when it declined the relief sought in the First Nation’s Notice of Question of Constitutional Law:

(a) the AER misinterpreted the First Nation’s constitutional notice as not seeking relief and not asking the AER to answer the stated questions; and

(b) the AER erred in interpreting all of the stated constitutional questions as raising the adequacy of the Crown’s consultation with the First Nation, a subject matter outside the AER’s jurisdiction.

The ABCA declined to grant permission to appeal on either issue related to the notice of constitutional questions.

The ABCA noted that the AER gave two independent reasons for refusing to consider the questions posed in the constitutional notice: the notice asked questions that were not within the AER’s jurisdiction, and the notice did not comply with APJA requirements. The ABCA found that an appeal on the issue of compliance with the notice requirements would be academic, in the sense that it would have no impact on the AER’s decision to decline the relief sought in the constitutional notice because the AER’s other reason for the decision would still stand.

On the issue of the notice raising questions of adequacy of consultation, the ABCA found that this was not a question of law nor did the ABCA find it of general importance. In the ABCA’s view, the interpretation of one particular constitutional notice, phrased in rather unclear language, was not a question of law. It had no precedential value or implications for other cases and was properly characterized as a question of mixed law and fact.

The ABCA also declined to grant permission to appeal the AER’s finding that the notice failed to comply with the notice requirements of the APJA.

Failing to Consider the Honour of the Crown / Refusing to Delay Approval of the Project Until the First Nation’s Negotiations With Alberta Were Completed and Implemented

The ABCA found that this issue raised a question of law of general importance. The ABCA found that the following question met the test for permission to appeal:

• Did the AER commit an error of law or jurisdiction by failing to consider the honour of the Crown and, as a result, failing to delay approval of the Project until the First Nation’s negotiations with Alberta about the MLAMP were completed?

The ABCA found that this proposed ground of appeal concerned the legal significance of the Letter of Intent entered into between Alberta and the First Nation in March 2015.

Interpretation and Application of Treaty 8 Rights

The ABCA accepted that the question of the proper interpretation of Treaty 8 rights was a question of law of considerable importance. However, the ABCA found that the First Nation failed to demonstrate an arguable case that Treaty 8 confers the rights it suggested.

The First Nation asserted that the AER gave an unduly narrow interpretation to the First Nation’s Treaty 8 rights. It argued that the AER interpreted Treaty 8 as protecting against certain “physical” and “immediate” effects on Treaty 8 rights and not as protecting against “intangible effects” on those rights.

With respect to the First Nation’s claim that the AER only addressed physical interferences with its Treaty 8 rights, the ABCA noted that the Supreme Court of Canada (“SCC”) took the same approach in Mikisew Cree First Nation v Canada (Minister of Canadian Heritage) (“Mikisew“). In that decision, the SCC considered whether a federal road that would run through the Mikisew reserve would adversely affect the Mikisew Treaty 8 rights, thereby triggering the duty to consult. The SCC in Mikisew assessed the physical effects of the road on the Treaty 8 rights to hunt, trap and fish. The AER carried out the same analysis of physical effects of the Project on the First Nation’s Treaty 8 rights in its traditional territories.

It was accepted that First Nation’s sense of connection to its traditional land was important and a relevant consideration for the AER when assessing whether it was in the public interest to approve an oil sands project. However, the ABCA concluded that the First Nation did not demonstrate an arguable case that Treaty 8 confers a right against disruption to its sense of connection or relationship to its traditional lands. Accordingly, permission to appeal on this issue was denied.

Failing to Consider Cumulative Effects of Development on the First Nation’s Treaty 8 Rights

The ABCA found that the AER’s reasons showed that it considered and applied this test for infringement, concluding that the Project would not render the First Nation’s Treaty 8 rights meaningless. The reasons disclosed no arguable error of law.

The First Nation submitted that the AER failed to consider the cumulative effects of oil sands development on its Treaty 8 rights when determining whether the Project was in the public interest. According to the First Nation, the AER assessed only the project-specific effects on its Treaty 8 rights.

The ABCA found that it was uncontroversial that the AER must consider the adverse effects of a project on treaty rights and that it cannot approve a project that infringed or will infringe treaty rights without justification because “[a] project authorization that breaches the constitutionally protected rights of Indigenous peoples cannot serve the public interest [citing Clyde River].”

The ABCA found that any argument that the AER failed to fully or accurately take into account the existing state of oil sands development on the Moose Lake Area would be a question of mixed fact and law, for which no appeal was available.

Accordingly, the ABCA denied permission to appeal on this issue.

Summary

The ABCA granted the First Nation permission to appeal on the following question:

• Did the AER commit an error of law or jurisdiction by failing to consider the honour of the Crown and, as a result, failing to delay approval of the Project until the First Nation’s negotiations with Alberta about the MLAMP were completed?

Related Posts

Judd v Alberta Energy Regulator, 2024 ABCA 154

Judd v Alberta Energy Regulator, 2024 ABCA 154

Link to Decision Summarized Download Summary in PDF Appeal – Production of Records Application Michael Judd ("Appellant") appealed a decision by the Alberta Energy Regulator (“AER”) that denied his...