On Dec. 1, the Supreme Court of Canada (SCC) released its decision in First Nation of Nacho Nyak Dun v. Yukon. The decision addresses the Yukon government’s obligation to follow the land use planning process set out in modern land claims agreements with First Nations. While the decision arises from a land use planning regime unique to Yukon, it will have implications for how governments and courts approach interpretation of modern treaties across Canada. By extension, the decision will have implications for resource developers in areas that are covered by modern treaties.
Yukon First Nations, Canada and the Yukon government entered into modern treaties (called final agreements) that contain provisions setting out a multi-stage process for collaborative development of land use plans:
- Step 1: An independent land use planning commission develops an initial recommended plan. .
- Step 2: Yukon government is required to consult on that initial plan before approving, rejecting or proposing modifications to it.
- Step 3: In response to Yukon’s decision, the commission is then required to reconsider as necessary and propose a Final Recommended Plan.
- Step 4: Yukon government is again required to consult on the final recommended plan before final approval, rejection or modification.
In this case, Yukon provided very general requested changes to the initial recommended plan (at Step 2). When the commission submitted the Final Recommended Plan, Yukon then proposed substantial modifications (at Step 4). The trial judge found that to be “an ungenerous interpretation not consistent with the honour and integrity of the Crown.” He remitted the process back to Step 4 and held that it was not open to Yukon to reject the Final Recommended Plan.
The Court of Appeal agreed that Yukon had run afoul of its obligations under the treaties, but imposed a significantly different remedy. It ordered that the parties return to Step 2, which would effectively have given Yukon an opportunity to to the plan. In many ways, for the Yukon First Nations this was “winning the battle but losing the war,” and they appealed to the SCC.
Before the SCC, Yukon did not contest that it had not complied with the process set out in the final agreements. The issue was whether the land use planning process should be sent back to Step 2, or to Step 4 where Yukon’s options were limited to approving, modifying or rejecting the Final Recommended Plan.
This was more than an academic dispute about processes.
The Final Recommended Plan had proposed significant limits to resource development in the Peel River region. Yukon wished to override those limits through extensive changes. If the planning process was only sent back to Step 4, Yukon’s ability to make those changes would be more limited.
The SCC returned the parties to Step 4, significantly narrowing the range of modifications Yukon could make to the plan.
The SCC stated: “… Yukon must bear the consequences of its failure to diligently advance its interests and exercise its right to propose access and development modifications to the Recommended Plan. It cannot use these proceedings to obtain another opportunity to exercise a right it chose not to exercise at the appropriate time.”
The SCC was clearly concerned that the Court of Appeal had inserted itself into the ongoing treaty relationship by returning the parties to an earlier stage of the process. Similarly, the SCC was concerned that the trial judge had also gone further than needed by ordering that Yukon must either accept or modify the Final Recommended Plan based on recommendations it had previously proposed. The SCC clarified that Yukon was not limited to recommendations it had previously proposed – it could make minor amendments based on changing circumstances – but it could not effectively propose a brand new plan.
The decision confirms that Yukon has the ultimate power to make decisions regarding the management of territorial lands.
However, that power is not unfettered. The decision also reminds governments – and by extension resource developers relying on authorizations given by governments – that treaty rights contained in modern treaties are to be given a large and liberal interpretation that upholds the honour of the Crown.
This includes commitments governments have made about processes for consideration of Indigenous interests in making land use decisions.
The broader implications may be as follows: First, the decision emphasizes that reconciliation is achieved not only by negotiating modern treaties, but by implementing them. At one time, the conclusion of modern treaties alone was seen as a way for governments to achieve finality and certainty as to the extent of Indigenous rights and the scope of government responsibilities. Now, conclusion of treaties is only one step in the process of reconciliation, which continues into treaty implementation.
Second, while the SCC states that “reconciliation often demands judicial forbearance” and that “(i)n resolving disputes that arise under modern treaties, courts should generally leave space for the parties to govern together and to work out their differences,” at the same time “courts play a critical role in safeguarding the rights” that modern treaties, as constitutional documents, provide. Courts will still supervise Crown conduct in the implementation of modern treaties, and can strike down government decisions not consistent with the honour of the Crown.
Third, for resource developers, the message remains that they must pay close attention to obligations arising under modern treaties that apply in areas where a project is proposed and should independently consider whether government regulatory decisions are being made in a manner that respects the terms of the treaties and the honour of the Crown. If proper processes are not being observed, then it is possible, as in this case, that the resulting decision may be quashed.
TOBY KRUGER, KEITH BERGNER and JOHN OLYNYK are members of the Indigenous Law Group at Lawson Lundell LLP.