SCC determines that an “inaccessible document dump” is NOT true consultation

Written by:

Jacob Marchel (Associate)

Overview

On July 26th, 2017 the Supreme Court of Canada (“SCC”) rendered its unanimous decision in the case of Clyde River (Hamlet) v. Petroleum Geo‑Services Inc. 2017 SCC 40 (“the Clyde River decision”). The Clyde River decision is important for two reasons. Firstly, it confirms that the Crown can rely on the regulatory and decision-making processes of a regulator (such as the National Energy Board) to satisfy the Crown’s duty to consult with Aboriginal/Indigenous groups, including in cases where the Crown itself is not involved in the regulatory process.

Secondly, the Clyde River decision provides guidance regarding what practices will, and will not, be considered adequate to meet Aboriginal/Indigenous consultation requirements. This may demonstrate a shift in the SCC’s approach to assessing the adequacy of consultation in specific cases. In the Clyde River decision the SCC moves beyond the application of generic principles of consultation to providing a more practical, context-based (i.e. case-by-case) analysis of the specific actions that must be taken by regulators and participants to discharge consultation duties in a given regulatory approval process. In the Clyde River decision the SCC found that the fatal flaw on the part of the NEB, the project proponents -- and ultimately the Crown – was that they failed to ensure the steps taken in the regulatory process properly reflected the needs and unique circumstances of the Inuit of Clyde River. On that basis, the SCC quashed the approval granted by the NEB.

Background

The Clyde River decision arises from the 2011 application by a group of companies: (1) TGS-NOPEC Geophysical Company ASA, (2) Multi Klient Invest As, and (3) Petroleum Geo-Services Inc. (“the companies”) seeking a five-year operating permit from the National Energy Board (“NEB”) to conduct offshore seismic surveys, in search of oil reserves in Baffin Bay and Davis Strait. As the proposed seismic activity would not occur directly in the Nunavut Settlement Area, the project was not subject to assessment under Nunavut’s regulatory regime. However, the Hamlet of Clyde River, Nunavut (“the Hamlet”) and the Nammautaq Hunters and Trappers Organization (“the local HTO”) intervened in the NEB proceedings in opposition to the application, alleging that the seismic surveys would interfere with marine mammals in the area and would, therefore, adversely impact Inuit rights, including the right to harvest marine mammals. Throughout the NEB process, the Hamlet, local HTO and individual community members continued to express their concerns that the sound waves associated with the surveys could negatively affect the health and migration patterns of marine mammals in the area, which could in turn adversely affect community members’ reliance on marine mammal harvesting to provide food and other economic opportunities.

The 3+ year NEB regulatory process included a few stops and starts to give the companies the opportunity to provide additional information to the NEB to address these and other concerns. At the NEB-led information meetings held in the Hamlet, the onus was on the companies to provide both information and answers to community questions. During these meetings, the companies were at times unable to answer specific questions regarding the potential for impacts on marine mammals associated with seismic surveys in an Arctic environment. As a follow up to the in-person meetings, the companies filed almost 4,000 pages of written materials with the NEB several months after the community meetings. The bulk of this material was not translated into Inuktitut and could not be downloaded by Hamlet residents due to bandwidth restrictions in the community.

In this case, the NEB was the sole and final decision-maker for the permit application, and the Federal Crown did not participate in the NEB’s regulatory review process or in parallel consultations with the Hamlet, the local HTO or Hamlet residents. Ultimately, in 2014, without any formal hearing processes, the NEB granted the application (NEB No. 5554587, June 26, 2014) and approved the seismic activities, finding that the companies’ proposed mitigation efforts were sufficient to prevent significant adverse effects.

The Court Below

The Hamlet and local HTO sought judicial review of the NEB decision at the Federal Court of Appeal (“FCA”) on the basis that the NEB had no legal authority to issue an approval because the Crown had failed to meet its constitutional duty to consult Aboriginal/Indigenous groups, as established under Section 35 of the Constitution Act, 1982 and the Agreement between the Inuit of the Nunavut Settlement Area and Her Majesty the Queen in Right of Canada, (“the Nunavut Agreement”). The FCA (Clyde River v. TGS-NOPEC Geophysical Company ASA (TGS), [2016] 3 FCR 167) decided the following:

The regulatory process associated with the application triggered the Crown’s duty to consult;
The NEB process could be relied upon by the Crown in whole or in part to fulfill the duty to consult arising from the application; and
The steps taken by the NEB and the companies during the regulatory process were sufficient to discharge the Crown’s duty to consult in this case.

The SCC Decision

The Hamlet and local HTO appealed to the SCC. In allowing the appeal and setting aside the NEB’s approval, the SCC answered the following four critical questions:

Can an NEB approval process trigger the duty to consult?
Can the Crown rely on the NEB’s process to fulfill the Crown’s duty to consult?
What is the NEB’s role in considering Crown consultation before issuing an approval?
Was the consultation conducted by the NEB in this case adequate?

1. Can an NEB approval process trigger the duty to consult?

Yes. Although the NEB is not strictly speaking ‘the Crown,’ the NEB does act on behalf of the Crown when making a final decision on certain project applications. Therefore, the NEB’s approval process represents Crown actions that may trigger the duty to consult (para. 29). The SCC clarified that it does not matter if the final decision maker is the Crown or the NEB, finding that the “substance of the duty to consult” (i.e. the degree to which the duty is owed to the Aboriginal peoples) does not change (para. 1).

2. Can the Crown rely on the NEB’s process to fulfill the duty to consult?

Yes. Although the Crown is ultimately responsible for ensuring that the consultation conducted is adequate (para. 22), the Crown may rely on steps taken by a regulatory agency (e.g. the NEB) to fulfill the duty to consult, in part or in full, so long as the agency has the statutory power to do what is necessary to meet the specific consultation requirements in the context of a given case (para. 30). However, if the agency’s statutory powers are insufficient in the particular circumstances of a case, or if the agency does not provide adequate consultation and accommodation, then “the Crown must take further measures to meet its duty” (e.g. the Crown could make submissions on its own behalf to the regulatory agency, etc.) (para. 22).

In addition, the SCC set out a key condition of Crown reliance on a tribunal’s process “where the Crown relies on the processes of a regulatory agency to fulfill its duty in whole or in part, it should be made clear to affected Indigenous groups that the Crown is so relying [on those processes] (para. 23).” Ultimately, the SCC determined that the NEB has “the procedural powers necessary to implement consultation, and the remedial powers to, where necessary, accommodate affected Aboriginal claims, or Aboriginal and treaty rights (para.34).” Therefore, the NEB’s process could be relied on by the Crown to completely, or partially, fulfill the Crown’s duty to consult (para. 34).

3. What is the NEB’s role in considering Crown consultation before issuing an approval?

The SCC stated the NEB has broad statutory powers (e.g. procedural and remedial powers) to hear and decide on all relevant matters of fact and law, and that a tribunal’s power “to decide questions of law implies a power to decide constitutional issues that are properly before it, absent a clear demonstration that the legislature intended to exclude such jurisdiction from the tribunal’s power (para. 36, citing Rio Tinto Alcan Inc. v. Carrier Sekani Tribal Council, [2010] 2 S.C.R. 650 at para. 69)”. Consequently, the SCC makes it clear that NEB decisions must comply with section 35 of the Constitution Act, 1982, and the NEB can determine if the Crown’s duty to consult has been fulfilled (para. 37).

The SCC further explained that in cases where affected Indigenous groups have “squarely raised concerns about Crown consultation with the NEB,” the NEB is expected to address those concerns in the form of written reasons (para. 41). Whether the consultation, and provided reasons, will be considered appropriate depends on the context in each case (para. 42). As was the case with Clyde River, where “deep” (i.e. significant) consultation is required, and the issue of Crown consultation is raised with the decision-maker, the decision-maker is obliged to “explain how it considered and addressed” Indigenous concerns (para. 42). Ultimately, if the Crown’s duty to consult remains unfulfilled, the NEB must withhold the project approval, and where the NEB fails to do so, the SCC indicated that the NEB’s approval decision should be set aside on judicial review (para. 39).

4. Was the consultation conducted by the NEB in this case adequate?

No. The SCC found the NEB’s consultation and accommodation efforts were inadequate and “fell short in several respects” (para. 45). First, the NEB’s consultation inquiry was “misdirected” (para. 45). “No consideration was given in the NEB’s environmental assessment to the source of the Inuit’s treaty rights, nor to the impact of the proposed testing on those rights (para. 45).” Secondly, the Crown never clearly communicated to the Inuit of Clyde River that the Crown intended to rely on the processes of the NEB to fulfill the Crown’s duty to consult (para. 46). Finally, and most importantly, the SCC found that that the NEB’s process did not meet the requirements of “deep consultation” (para. 47). For instance, only “[l]imited opportunities for participation and consultation were made available…there were no oral hearings[,] and there was no participant funding (para. 47).” The SCC’s contextual analysis also clearly recognized that the unique context of Clyde River (a community with a high proportion of unilingual residents who communicate in Inuktitut only, that values Inuit oral traditions, and with significant limits on bandwidth) should have been recognized in the actions taken to meet consultation obligations. As stated by the SCC: “To put it mildly, furnishing answers to questions that went to the heart of the treaty rights at stake in the form of a practically inaccessible document dump months after the questions were initially asked in person is not true consultation (para. 69).”

Ultimately, the SCC concluded the NEB failed to properly conduct consultation that reflected the needs and unique circumstances of the Inuit of Clyde River. These failings made it so that there “was no mutual understanding on the core issues — the potential impact on treaty rights, and possible accommodations (para. 49).” Failing to take sufficient steps to build mutual understandings resulted in the Crown failing to discharge the duty to consult, and the NEB’s approval was set aside as a result.

Impact of the Decision

The Clyde River decision provides useful guidance about the Crown’s ability to rely on regulatory processes (like the NEB’s) to fulfill their duty to consult with, and if required, accommodate, Aboriginal/Indigenous peoples. The Clyde River decision also highlights the importance for regulatory agencies, project proponents and ultimately, the Crown, to ensure that steps taken to discharge the duty to consult are practical, effective and properly reflect the specific context of the Aboriginal/Indigenous groups involved. ‘Inaccessible document dumps’ and ‘random acts of doughnuts’ that do not lead to mutual understanding will not be considered adequate consultation and can result in delayed or refused project approvals. Ultimately, designing consultation processes that reflect the context of the regulatory process and the consultation will be central to successfully discharging the duty to consult.