• Byron Nelson

Consult vs Consent in Energy Development

Which is it?


August 21, 2019


In the context of the current political climate, it is difficult to understand the requirement to consult with indigenous peoples in the context of energy development.

Specifically, whether there is a requirement for government bodies to consult indigenous peoples or whether indigenous peoples are required to provide consent before, for example, a pipeline crosses their land.


Historical Rights


The Constitution Act of 1982 says, at Section 35, the following:


35. (1) The existing aboriginal and treaty rights of the aboriginal peoples of Canada are hereby recognized and affirmed.

(2) In this Act, “aboriginal peoples of Canada” includes the Indian, Inuit and Métis peoples of Canada.

(3) For greater certainty, in subsection (1) “treaty rights” includes rights that now exist by way of land claims agreements or may be so acquired.

(4) Notwithstanding any other provision of this Act, the aboriginal and treaty rights referred to in subsection (1) are guaranteed equally to male and female persons.


The Duty to “Consult and Accommodate” arising from S. 35 has been clarified by the courts, most notably in the Supreme Court of Canada decision in Haida Nation v. British Columbia (Minister of Forests) (2004) 3 SCR 511.


In the Haida decision, the Supreme Court found that there is a three-part test to determine if there is a duty to consult and accommodate:


(i) The government must have real or constructive knowledge of a right held by indigenous peoples. (in the Haida case, the first nation was claiming an ancient right to lands that was not contained in a treaty and was claimed to be unknown to the province of British Columbia, who had granted logging rights over that land);

(ii) A government plans action within an area of an indigenous group’s traditional rights; and

(iii) The government’s decision on a matter has the ability to adversely impact such rights.


As noted above, the Haida decision involved several islands off the west coast of British Columbia which were claimed by the Haida Nation but which were legally owned by the government of British Columbia. The islands are rich in trees and the province had, for many years, provided logging permits on the islands. Such permits are called “tree farm licenses” but will be called logging permits herein. The Haida Nation sought to clarify their ownership of the islands in a separate lawsuit, but the case being decided was whether the government had breached its duty to consult and accomodate the Haida Nation before granting logging permits. The Supreme Court found that the British Columbia government had indeed breached its duty to consult and accommodate.


The duty to accommodate has been generally taken to be the payment of compensation to the impacted indigenous group but could also include mitigating the impact, monitoring the impact, and other such steps.


United Nations Declaration on the Rights of Indigenous Peoples


On September 13, 2007, the United Nations General Assembly adopted the United Nations Declaration on the Rights of Indigenous Peoples. Canada was one of four countries that voted against this Declaration, along with Australia, New Zealand and the United States. All four countries have since indicated support of this Declaration. Interestingly both Canada’s initial opposition and its subsequent support of this Declaration came under the Harper government.


This Declaration is only a political document and is not legally binding, unlike a treaty or covenant. It is the position of the government of Canada that while this Declaration is not legally binding, Canada supports the ideas in the Declaration.


Articles 18 and 19 of the Declaration state that indigenous groups should be entitled to participate in decisions that effect them and that their “free, prior and informed” consent is required before a government takes actions that impact the indigenous peoples.

Notwithstanding this strong language, it is clear that while Canada supports the principles of this Declaration, it does not consider that indigenous consent is required in any event.


The Trans-Mountain Decision


Almost a year ago, on August 30, 2018, the Federal Court of Canada handed down its decision in Tsleil-Waututh Nation v. Canada (Attorney-General) which stopped the building of the Trans-Mountain pipeline.


The court found that the National Energy Board made a critical error in not including “project-related tanker traffic” as part of its environmental assessment under the project. More significantly, that the government had failed to discharge its constitutional obligation to consult and accommodate the impacted indigenous peoples, with regards to Phase III of the project.


This decision was criticized because of the particularization of the consultation being restricted to Phase III, whereas the consultation was found to be acceptable on all other stages of the pipeline approval.


However, it is important to note that the court did not apply the wording of the UN Declaration and the requirement therein for “free, prior and informed” consent. There has been some suggestion that this judgment required indigenous consent, but the judgment itself was very clear that consent is not required in these sorts of projects.


Post-C-69


As such, there was previously not a duty to obtain consent from an indigenous groups before allowing action over their land. Practically, it may have seemed to producers that the Haida decisions, and others, effectively created a situation where consent is required, however that is not the case.


In Haida, the company that had been granted the logging permit was found to not be liable for any obligations owed to the Haida Nation. Such obligations were solely owed by the Crown, through the government of British Columbia.


To use an energy example resulting from the Haida decision, midstream energy companies have not formally required consent from impacted indigenous groups for their projects, although many such companies did choose to obtain as much consent as possible, to ensure a smoother process in seeking approval of their proposed projects.


However, this has slightly changed with the passage of Bill C-69 by Parliament in June of 2019. Bill C-69, which has received royal assent, created the Canadian Energy Regulator Act (“CERA”). This Act replaces the National Energy Board Regulator and creates a new regulator, being the Canadian Energy Regulator.


CERA, at paragraph 56 thereof, outlines that the Regulator now has a duty to consider impacts on indigenous persons that might be impacted by its decision. The wording is as follows:


56(1) When making a decision, an order or a recommendation under this Act, the Commission must consider any adverse effects that the decision, order or recommendation may have on the rights of the Indigenous peoples of Canada recognized and affirmed by section 35 of the Constitution Act, 1982.

(2) When making a decision or an order under this Act, a designated officer must consider any adverse effects that the decision or order may have on the rights of the Indigenous peoples of Canada recognized and affirmed by section 35 of the Constitution Act, 1982.


During the parliamentary deliberations on Bill C-69, before it was finalized, the Senate had proposed changing the word “must” in Section 56 to “may”. The Liberal government rejected that amendment and thus the word “must” is now in force.

The speculation is that this wording will be used to block further energy development. The Regulator merely has to consider whether indigenous rights may be impacted. If so, then the project should not be approved.


Notwithstanding the dire reactions to the passage of Bill C-69, the requirement to “consult and accommodate” appears in the Constitution and has not been overruled by this bill. That means that any requirements of “consideration” must be over and above the duty to “consult and accommodate”.


It should be noted that the word “consent” did not appear in Bill C-69. That is specific and intentional. As such, whatever the future holds, it seems clear that indigenous consent is not required.


2019 Election


It should be noted that there will be a federal election in 2019. While the election will be decided in central Canada, the existence of Bill C-69 and the resulting legislation will be determined in that election. The Conservative Party has advised that it will repeal Bills C-48 and C-69. However, if the Liberal party is re-elected, the CERA will be the new reality.


Byron W. Nelson is the Managing Partner of Inns Law and has practised in the areas of commercial and energy law for more than twenty years.

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