Date: 20110119
Docket: T-434-06
Citation: 2010 FC 1244
Vancouver, British Columbia, January 19, 2011
PRESENT: Roger R. Lafrenière, Esquire
Case
Management Judge
BETWEEN:
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MAGGIE MYRNA LORRAINE GAMBLIN
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Applicant
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and
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NORWAY HOUSE CREE NATION
BAND COUNCIL
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Respondent
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REASONS FOR ORDER AND ORDER
[1]
On
March 9, 2006, the Applicant, a member of the Norway House Cree Nation (NHCN),
filed a Notice of Application seeking an order declaring a Resolution by the
Respondent, NHCN Band Council (Band Council) dated July 21, 2005 (BCR) void and
without force and effect, as well as an order quashing the Band Council’s
decision of February 7, 2006 purporting to ratify the BCR.
[2]
The
Attorney General of Canada (Canada) seeks an order to be added as a respondent or,
alternatively, for leave to intervene in the present proceeding. For the
reasons that follow, I conclude that Canada should be joined as a respondent because it is
directly affected by the declaration and orders sought by the Applicant.
Further, Canada’s participation is necessary
because the current Band Council does not appear to be a genuine contradictor
that is prepared to properly defend its predecessor’s decisions.
Background Facts
[3]
It is
essential to set out in detail the context and history giving rise to the BCR
and the subsequent ratification decision in order to understand Canada’s interest in this
proceeding.
[4]
On
December 16, 1977, Canada, the Province of
Manitoba, Manitoba Hydro and the Northern Flood Committee Inc., representing
five First Nations, including the NHCN, executed the Northern Flood Agreement
(NFA). The NFA was designed to compensate the said First Nations for adverse
effects of flooding caused by Manitoba Hydro projects.
[5]
Under
Article 6.1 of the NFA, Canada accepted responsibility to ensure the
continuous availability of a potable water supply on each of the First Nations
reserves. Under Article 6.2, Manitoba Hydro promised to reimburse Canada 50% of its
reasonable potable water-related expenditures attributable to adverse effects
of the Project.
[6]
On
May 10, 1988, Canada entered into
an Infrastructure Agreement (IA) with the Northern Flood Committee Inc., the
Northern Flood Capital Reconstruction Authority Inc. (NFCRA), and the five
First Nations. The IA was intended to satisfy Canada’s obligations to ensure
a continuous availability of a potable water supply for the First Nations by
enabling them to provide it for themselves.
[7]
Under
Article 15 of the IA, Canada agreed to attempt to recover the maximum
amount possible from Manitoba Hydro pursuant to Article 6.2 of the NFA using
arbitration, if necessary, and to transfer any amounts recovered to the NFCRA
for potable water projects of the NFA First Nations, subject to the conditions
contained in Article 15 of the IA.
[8]
Canada filed
arbitration Claim 138 against Manitoba Hydro on April 19, 1984, to determine
Manitoba Hydro’s
liability under NFA Article 6.2 for Canada’s potable water expenses. The First Nations
subsequently intervened, at Canada’s expense, in Claim 138.
[9]
On
November 19, 2003, Canada and Manitoba Hydro signed a letter of intent
outlining the key components of a settlement of Claim 138. NHCN gave “interim approval in
principle” to the amount of the settlement and terms of its payment as
reflected in a Band Council Resolution (BCR) dated May 19, 2004.
[10]
Canada and Manitoba Hydro
formalized the settlement on August 27, 2004. Manitoba Hydro agreed to pay
$40.5 million to Canada, in installments over 17 years from 2004 to 2021; Canada had the express right
to instruct Manitoba Hydro to pay one or more of the First Nations directly; and Canada and Manitoba
Hydro agreed to seek a consent dismissal of Claim 138 from the NFA Arbitrator.
[11]
On
October 28, 2004, Canada signed the Claim 138 Settlement Agreement
(Settlement Agreement) with NHCN and three other First Nations. Canada agreed that
Manitoba Hydro would pay the $40.5 million directly to NHCN and the other
signatory First Nations by installments. NHCN’s share of each installment was 28%,
totaling $11,340,000.00 of the $40.5 million.
[12]
In
the Settlement Agreement, NHCN consented to a dismissal of Claim 138 (Article
2.1); released Canada from any further liability under Article 6 of the NFA and
section 15 of the IA (Article 3); agreed that NHCN Chief and Band Council had
approved the terms and conditions of the Settlement Agreement as evidenced by a
BCR prior to executing it (Article 5.1 and 6.1(a)); had received independent
legal advice prior to executing it (Article 6.1(b); represented and warranted
that it was not under any legal impediment that would prevent it from executing
the Settlement Agreement (Article 9.1); and agreed that the Settlement
Agreement was binding upon its members (Article 11.1).
[13]
On
November 26, 2004, the NFA Arbitrator dismissed Claim 138 with the consent of Canada and Manitoba
Hydro. NHCN also gave its consent to the dismissal of Claim 138 through its own
legal counsel.
[14]
Manitoba
Hydro made its first installment payment of $1.5 million to Canada on
September 1, 2004. NHCN received $420,000.00 from Canada as its 28%
share. On June 10, 2005, at the request of NHCN, Canada instructed
Manitoba Hydro to pay NHCN’s 28% share of further installments directly to NHCN.
Manitoba Hydro accepted this direction.
[15]
Subsequently,
at NHCN’s request, Manitoba Hydro agreed to pay the balance of NHCN’s share
($10,920,000.00) by way of an accelerated lump sum payment of $6,365,000.00,
which was the present value of that share as determined by NHCN’s independent
legal and accounting advisors.
[16]
On
July 21, 2005, NHCN produced the BCR being impugned in the present application.
The BCR formally approved and acknowledged receipt of the accelerated lump sum
payment of $6,365,000.00 from Manitoba Hydro and authorized NHCN to provide a
full and final release to Canada regarding all future obligations under the
Claim 138 Settlement Agreement. The BCR and Release were duly signed by a
majority of Chief and Band Council.
[17]
Manitoba
Hydro subsequently paid the amount of $6,365,000.00 to NHCN in satisfaction of Canada’s obligation to pay the
balance of NHCN’s share of the Manitoba Hydro monies.
[18]
At
a NHCN Band Council meeting held on February 7, 2006, Councillor Saunders moved
to ratify the BCR dated July 21, 2005. Councillors Clarke, Muswagon and Saunders
voted in favour of the motion, while Councillor Balfour was the sole vote
against it.
Procedural
History of the Application
[19]
As
stated earlier in these reasons, the Applicant commenced her application for
judicial review on March 9, 2006. Canada immediately moved to be added as a party or for
leave to intervene.
[20]
On
May 4, 2006,
counsel for the Band Council wrote to advise that the parties had agreed to
hold the proceeding in abeyance in order to allow more time for settlement discussions.
A meeting was scheduled to take place on October 12, 2006 for the purpose of
allowing Canada to present additional
information regarding Claim 138 to the Applicant, the Band Council and members
of the NHCN. By Order dated September 14, 2006, Madam Prothonotary Mireille
Tabib stayed the proceeding until October 20, 2006.
[21]
The October
12 meeting was cancelled as a result of several deaths in the community and was
rescheduled for December 7, 2006. On direction of Prothonotary Tabib, the
Band Council moved for an order that the motion filed by Canada, which had
previously been adjourned by consent, be stayed or adjourned for a further
period of time, and that all time periods prescribed by the Federal Courts
Rules be extended until such time as Canada’s motion was
heard and adjudicated.
[22]
By
Order dated November 14, 2006, the application was allowed to continue as a
specially managed proceeding. Canada’s motion was adjourned sine die and
the application was stayed. The Applicant was also directed to submit a status
report and a joint schedule for completion of the next steps in the proceeding
by December 18, 2006.
[23]
In
her submissions dated December 18, 2006, the Applicant indicated that she had
not received certified copies of the documents requested in her Notice of
Application from the Band Council and that she could not pursue the application
in a proper manner without the documents. The Applicant also wrote that,
although she remained very determined to proceed with her application, she
could not afford a lawyer, could not proceed without legal assistance, and intended
to seek an advance cost order to obtain legal representation.
[24]
On
January 2, 2007, the
Applicant was directed to bring a motion to compel production of documents by
the Band Council, once the stay of proceedings had been lifted upon the joint
request of the parties, or upon motion by any party. The need for a motion was
obviated by the transmission of true copies of the requested documents by the
Band Council on February 2, 2007.
[25]
The
proceeding subsequently lay dormant for almost three years. On January 10, 2010,
the following directions were issued to the parties:
By Order dated November 14, 2006, the
action was stayed on consent of the parties. As there has been no activity on
the file for over three years, the Applicant is directed to submit a letter by
March 1, 2010 to advise whether she intends to proceed with the application and
seek such orders or directions as may be required to either conclude the
proceeding or move the proceeding forward pursuant to Rule 385 of the Federal
Courts Rules.
[26]
The
Applicant responded on March 1, 2010 that she intended to pursue the matter
represented by legal counsel. She submitted a copy of a retainer fee for her
lawyer as provided to her by NHCN at the direction of the Band Membership. The
Applicant indicated that the issue of continued funding of the application
would need to be put to the next Chief and Council after the NHCN General
Election scheduled on March 17, 2010.
[27]
By
Order dated March 8, 2010, the stay of proceedings was lifted and the Applicant
was directed to serve and file a Notice of Appointment of Solicitor by March
31, 2010. Canada was directed
to submit dates of mutual availability of counsel for the hearing of its
outstanding motion within one week of the appointment of a solicitor of record
by the Applicant.
[28]
On
March 30, 2010, the Applicant requested additional time to submit the name of
her lawyer. The next day, the Registry received a letter from Mr. Vilko Zbogar
with Orkin Barristers advising the Court that the law firm had been consulted
by the Applicant but required more time to review the file and to be formally
retained.
[29]
In
the absence of any further steps being taken by the Applicant, an Order was
issued on June 15, 2010 pursuant to Rule 385(2) of the Federal Courts Rules,
requiring the Applicant to show cause by written submissions why the
application should not be dismissed for delay, and for failure to comply with
the Order dated March 8, 2010.
[30]
Following
receipt of the written submissions from the Applicant and Canada, the
proceeding was allowed to continue on the basis that the parties had acquiesced
to the delay.
Position of
the Parties
[31]
Canada submits that it has an
interest in the proceeding and is directly affected by the order sought by the
Applicant. It maintains that its participation as a party is necessary to
ensure that matters in the application may be effectually and completely
determined.
[32]
The
Applicant contends that the only parties that will be affected by any order in
this application for judicial review are the Band and its members. According to
the Applicant, Canada will not be directly
affected since its contractual rights are not at issue in the proceeding. She
argues that Canada’s concern that the Court’s
decision may be used in future legal proceedings concerning the validity or
applicability of the Claim 138 Settlement Agreement or the release of Canada does not warrant
joinder in this case.
[33]
The
Band Council takes no position on the motion.
Analysis
[34]
Rule
303(1)(a) of the Federal Courts Rules provides that an applicant shall
name as a respondent every person “directly affected by the order sought in the
application”.
[35]
It
is understandable that Canada has expressed an interest in these
proceedings. If the order sought by the Applicant is made, the Applicant or
other person may use that order to attack the validity of the consent dismissal
of Claim 138 and release of Canada, the Claim 138 Settlement Agreement with
NHCN itself, or NHCN’s agreement with Manitoba Hydro to accept a discounted
lump sum rather than installments over time.
[36]
The
Applicant suggests that the application for judicial review is simply about
whether a band council resolution, and its purported ratification, is valid or
not. It remains, however, that at its root, the main purpose of the application
appears to be to impugn the Claim 138 Settlement Agreement, by attacking the
underlying authority of the Band Council to effectively execute the Claim 138
Settlement Agreement on behalf of NHCN, and its authority to negotiate an
accelerated payment and to provide the Release. The potential consequences are
not, in my view, a “local matter” or a simple issue of good governance.
[37]
Canada clearly has
an interest in confirming that documents relied on to provide the Band Council
with authority to consent to the dismissal of Claim 138, execute the Claim 138
Settlement Agreement, accelerate the payments and execute the Release did, in
fact, provide such authority. Whether such documents were sufficient authority or
whether they have any bearing on the validity of the Claim 138 Settlement
Agreement are questions which Canada would have to address should that issue
arise in subsequent proceedings. In the circumstances, I conclude that Canada is directly
affected and should be added as a respondent.
[38]
In
any event, even if Canada was not directly
affected by the relief sought in the application, I am satisfied that it should
be joined as a party to ensure that all matters in dispute may be effectually and
completely determined. The Band Council has maintained, for unspecified
reasons, a passive role over the past three years. It is not clear to me on
what basis the application was allowed to remain dormant for such an extended
period of time, and why the Band Council acquiesced to the substantial delay by
the Applicant in moving the proceeding forward.
[39]
The
Band Council’s inaction seems to me consistent with a decision that it will
take no position in this case and unload the entire responsibility of determining
the issues in the application onto the Court with no legitimus contradictor of what the Applicant says.
In the circumstances, I conclude that the Court would benefit from hearing
arguments by Canada in favour of the
validity of the BCR and its ratification by the Band Council.
ORDER
THIS COURT
ORDERS that:
1.
The
Attorney General of Canada be added as a respondent to this application, so
that the style of cause in these proceedings shall hereinafter read:
BETWEEN:
MAGGIE MYRNA LORRAINE GAMBLIN
Applicant
and
NORWAY HOUSE CREE NATION BAND COUNCIL
AND THE ATTORNEY GENERAL OF CANADA
Respondents
2.
The
Attorney General of Canada shall be entitled to the costs and disbursements in
respect of this motion in the cause as against the Applicant, Maggie Myrna
Lorraine Gamblin. Costs shall be fixed at $2,500.00 plus GST of $125.00, with
disbursements of $3,000.00.
“Roger
R. Lafrenière”
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