Docket:
A-107-13
Citation: 2014 FCA 150
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CORAM:
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SHARLOW J.A.
STRATAS J.A.
MAINVILLE J.A.
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BETWEEN:
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HER MAJESTY THE QUEEN
IN RIGHT OF CANADA
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Appellant
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and
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KITSELAS FIRST NATION
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Respondent
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and
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A COALITION OF FIRST NATIONS LED BY THE UNION OF BRITISH COLUMBIA INDIAN CHIEFS
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Intervener
and
SPECIFIC CLAIMS TRIBUNAL
Intervener
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REASONS FOR
JUDGMENT
MAINVILLE
J.A.
[1]
This is a judicial review under section 28 of the Federal
Courts Act, R.S.C. 1985 c. F-7 of a decision dated February 19, 2013, and
cited as 2013 SCTC 1 (Reasons), by which the Honourable Harry Slade (Judge),
the Chairperson of the Specific Claims Tribunal, found that the Kitselas First
Nation (Kitselas) had validly established a breach of a legal obligation of the
Crown in Right of Canada (Canada) as a result of the non-inclusion of a 10.5
acre parcel of land in a reserve initially identified in 1891 and known as
Kitselas I.R. No. 1.
[2]
The principal submission of Canada is that the Judge erred in law
by holding that Canada had a fiduciary duty at the reserve allotment stage. Canada also submits that the Judge made unreasonable determinations of fact and of mixed
fact and law in reaching his decision. It further submits that the Judge erred
in finding that Canada was solely liable for breaches of Canada’s alleged duty with respect to the excluded land.
[3]
For the reasons set out below, I would dismiss this judicial
review application.
CONTEXT AND BACKGROUND
[4]
The Judge provided an extensive review of the historical facts
pertaining to the claim at issue in these proceedings, which need not be
repeated in these reasons. A short summary of the most pertinent facts will
suffice.
[5]
The territory historically occupied by the Kitselas is along the Skeena River in British Columbia, upstream from Port Essington which is located near the
mouth of the River.
[6]
When British Columbia entered Confederation in 1871, the British
Columbia Terms of Union, R.S.C. 1985, App. II, No. 10 addressed aboriginal
matters in Article 13, which notably provided for the appropriation of tracts
of land to be conveyed from the provincial government to the federal government
in trust for the use and benefit of the various aboriginal populations of the
province.
[7]
For that purpose, Canada and British Columbia established a Joint Indian
Reserve Commission which was to visit each aboriginal nation in British
Columbia to inquire into reserve allotments and to fix and determine separately
for each nation the number, extent and locality of reserves taking into account
their habits, wants, pursuits, and the amount of territory available in the
region occupied by them, as well as the claims of the White settlers.
[8]
In September 1891, the sole commissioner of the Joint Indian Reserve
Commission was Mr. Peter O’Reilly. In September 1891, Commissioner O’Reilly
traveled along the Skeena River to identify land to be set apart as reserves
for the Kitselas and other aboriginal nations. Various exchanges and meetings
between Commissioner O’Reilly and representatives of the Kitselas ensued,
leading to a recommendation by the Commissioner to set aside six reserves for
this First Nation, totaling 2910 acres, including Kitselas I.R. No. 1
comprising 2110 acres.
[9]
Commissioner O’Reilly excluded from Kitselas IR No. 1
approximately 10 acres on the left bank of the Skeena River, on which a
storehouse of the Hudson’s Bay Company then stood. When he wrote to British
Columbia’s Chief Commissioner of Lands and Works on January 28, 1892 seeking
approval of his recommended reserve allotments, Commissioner O’Reilly noted
that “[t]here are no
settlements in the neighborhood of any of these reserves and should any such
occur, the interest of the whites and the Indian are not likely to clash.” He further explained the exclusion of approximately
10 acres from Kitselas I.R. No. 1 as follows:
I have omitted from Reserve No. 1 Kitselas ten acres on the left
bank of the river immediately below the [canyon] as I believe it would prove a
convenience to the public to have this land declared a public reserve, and that
you might think it advisable to act on my suggestion. The Hudsons Bay Company
have already erected a small storehouse thereon.
[10]
British Columbia and Canada eventually approved the reserves recommended
by Commissioner O’Reilly. Once proposed reserve allotments were approved by
both governments, they were deemed “provisionally
approved” and withdrawn
from inconsistent uses. Provisionally approved reserves, such as Kitselas I.R.
No. 1, did not become legally established reserves within the meaning of the Indian
Act, R.S.C. 1985 c. I-5, until July 29, 1938, when British Columbia
transferred the administration and control of the lands to Canada.
[11]
In 1901, the allotment for Kitselas I.R. No. 1 and the 10.5 acre
exclusion were surveyed. The exclusion became known as Lot 113, which was bordered
on all sides by Kitselas I.R. No. 1 except for the border marked by the
riverbank.
[12]
British Columbia subsequently subdivided Lot 113 into 50 lots. Some were
purchased by speculators. The land remained undeveloped until 1907, when it
became a service centre for workers employed in the construction of a railway.
The work was completed in 1913, and the land was then abandoned. The subdivided
lots eventually reverted to British Columbia for non-payment of taxes. The land
comprising Lot 113 is now a provincial park.
[13]
In the year 2000, the Kitselas submitted a claim to the Minister of
Indian Affairs under Canada’s policy concerning the resolution of so-called “specific” claims arising from Indian
treaties and reserve lands. The Kitselas alleged that Canada had breached its fiduciary duty in connection with the exclusion of the 10.5 acres known as Lot 113 from Kitselas I.R. No. 1. The Minister did not accept the claim, and notified the
Kitselas accordingly in 2009. As a result, the Kitselas commenced a proceeding
under the then recently adopted Specific Claims Tribunal Act. S.C. 2008,
c. 22 (SCT Act).
THE DECISION UNDER REVIEW
[14]
Following an extensive review of the evidence, and after hearing witness
testimony, including oral history, the Judge made the following important
findings of fact:
(a)
The 10.5 acre area of land excluded from Kitselas I.R. No. 1 included
the site of an ancient village of the Kitselas known as Gitaus, and though
there were visible indications of the use of the former village site in 1891,
it would not have been perceived by Commissioner O’Reilly as a village;
however, from the aboriginal perspective, the site of the ancient Gitaus
village would not have been abandoned by the Kitselas at the time Commissioner
O’Reilly proceeded to make the reserve allocation, and that site was of
significance to the identity of the Kitselas peoples: Reasons at paras. 81 to
87.
(b)
Indian dwellings were on the Gitaus site when Commissioner O’Reilly
attended in 1891, and these would have been seen by him: Reasons at paras. 88
to 90.
(c)
There were no claims of White settlers over the excluded 10.5 acres,
that land was not excluded in anticipation of the use of the land for
transportation purposes, and the Hudson’s Bay Company required no more than 1
acre of land for its activities on the site: Reasons at paras. 91 to 93.
(d)
There was no basis in the evidence to support a finding that the 10.5
acres would not form part of Kitselas I.R. No. 1 today if Commissioner O’Reilly
had not excluded it: Reasons at para. 147.
[15]
Relying principally on the analysis of Binnie J. in Wewaykum Indian
Band v. Canada, 2002 SCC 79, [2002] 4 S.C.R. 245 (Wewaykum), the
Judge determined that the general requirements to establish a fiduciary duty
were the identification of a cognizable Indian interest coupled with the
Crown’s discretionary control in relation thereto in a way sufficient to find a
fiduciary duty: Reasons at paras. 107 to 113.
[16]
While recognizing that the 10.5 acres that had been excluded from the
reserve were not held in trust for the Kitselas, nor were they considered part
of a “provisional reserve”, the Judge nevertheless found
that the Kitselas had a cognizable Indian interest in the excluded land on the
basis that the land at issue was contemplated by Article 13 of the British
Columbia Terms of Union. The Judge concluded that “[t]he Indian interest in the land they used and
occupied was recognized by the colonial authorities”, and “[on]
confederation, the colonial policy continued as a constitutional responsibility
of Canada”: Reasons at
paras. 143. The Judge thus found “that the Indian Nations had, at a minimum, a substantial practical
interest in land they habitually used”, and that “[t]his was a cognizable interest”:
Reasons at para. 144.
[17]
With respect to the Crown’s discretionary control in relation to the
land at issue in a way sufficient to result in a fiduciary duty, the Judge
concluded that there was no basis in the evidence that would support a finding
that the 10.5 acres at issue would not have formed part of Kitselas I.R. No. 1
had Commissioner O’Reilly not made his recommendation to exclude it: Reasons at
para. 147. In the Judge’s view, “Commissioner
O’Reilly was the vehicle by which federal discretion would be exercised over
the establishment of reserves”:
Reasons at para. 200.
[18]
Since the instructions to Commissioner O’Reilly were notably “to leave the Indians in the old
places to which they are attached”,
the Judge concluded that it was against the performance of that requirement and
the other instruction provided to him “that
Crown obligations of loyalty, good faith, disclosure, and acting reasonably and
with diligence in regard to the best interests of the Indians, stand to be
measured”: Reasons at
paras. 168 and 169.
[19]
The Judge also concluded that the evidence, taken as a whole, did not
support a finding that Commissioner O’Reilly informed the Kitselas of the
exclusion of the 10.5 acres from the reserve: Reasons at para. 182-183.
Moreover, since no claims by White settlers had been made against the excluded
land, the Judge further concluded that Commissioner O’Reilly had no authority
to exclude the land from the reserve allotment once it was established that it
was used and occupied by the Kitselas as an ancient settlement to which they
were attached: Reasons at paras. 201-202.
[20]
As a result, the Judge concluded that Canada, by the actions of
Commissioner O’Reilly, failed to act reasonably and with diligence in regard to
the best interests of the Kitselas in excluding the concerned land from
Kitselas I.R. No. 1, save with respect to the one acre site of the storehouse
used by the Hudson’s Bay Company: Reasons at para. 203 to 205.
THE ISSUES
[21]
The issues identified by Canada as central to its judicial review
application are the following:
(a)
What standard of review is applicable?
(b)
Did the Judge err by concluding that Canada had a fiduciary duty to the
Kitselas in the reserve allotment process?
(c)
If not, did the Judge err by finding that Canada breached its duty?
(d)
If Canada breached its duty, did the Judge err by finding Canada solely responsible for any losses flowing from the breach?
standard of review
[22]
There is no dispute that the findings of fact and of mixed fact and law
of the Judge are to be reviewed under a standard of reasonableness. The parties
disagree, however, as to the standard of review that applies to the findings of
law made by the Judge in this case.
[23]
The principal issues of law raised by Canada in its application are (1)
whether the Judge incorrectly expanded cognizable Indian interests and the
Crown’s undertaking of discretionary control in order to find a fiduciary duty,
and (2) if the duty exists, whether the Judge erred with respect to the
division of liability between Canada and British Columbia stemming from that
duty. Canada submits that these substantive legal issues should be judicially
reviewed on a standard of correctness.
[24]
I need not address the standard of review with respect to the second
issue since it does not arise in this case, as further discussed in the last
section of these reasons. I agree, however, with Canada that the first issue is
to be reviewed on a standard of correctness. My reasons for so concluding are
the following.
[25]
Several factors determine the appropriate standard of review, including
the purpose of the SCT Act, the nature of the issue subject to review,
the specialized expertise of the Specific Claims Tribunal, and the existence or
absence of a privative clause: Dunsmuir v. New Brunswick, 2008 SCC 9,
[2008] 1 S.C.R. 190 at paras. 62 to 64 (Dunsmuir).
[26]
The purpose of the SCT Act is to establish the Specific Claims
Tribunal, comprised of a roster of superior court judges from across Canada, to decide issues of validity and compensation relating to the specific claims of
First Nations identified in the legislation. The specific claims that are
contemplated are principally those old historic claims that are generally
precluded from adjudication before the superior courts in light of the passage
of time. Prior to the establishment of the Specific Claims Tribunal, these
claims were determined by the Minister without any binding and independent
adjudication mechanism. The fundamental purpose of the SCT Act is therefore
to allow such claims to now be adjudicated by independent superior court judges
without consideration of any rule or doctrine that would have the effect of
limiting claims or prescribing rights against Canada because of the passage of
time or delay.
[27]
There are two principal aspects to the mandate of a superior court judge
acting under the SCT Act. First the judge must determine the validity of
the claim: SCT Act section 14. Second, if the claim is deemed valid, the
judge must then determine the appropriate level of compensation owed: SCT
Act section 20.
[28]
The validity of a claim must be determined in accordance with general
legal principles, notably the principles of fiduciary law as applicable to the
Crown-aboriginal relationship: paragraph 14(1)(c) of the SCT Act.
The SCT Act does not establish a code of liability with respect to
specific claims, which are rather adjudicated in accordance with the general
principles of the federal common law pertaining to aboriginal matters.
[29]
A superior court judge acting as a member of the Specific Claims
Tribunal is not bound by any rule or doctrine that would limit claims or
prescribe rights against the Crown because of the passage of time, and may act
flexibly with respect to the receipt and acceptance of evidence, including
accepting and considering oral history: SCT Act paragraph 13(1)(b)
and section 19. Nevertheless, in determining the validity of a specific
claim, a superior court judge acting as a member of the Specific Claims
Tribunal must apply and interpret the law in the same manner as a judge of a superior
court.
[30]
The existence of a fiduciary duty and the rules to determine whether a
specific claim is valid constitute substantive legal issues. There is no
discrete administrative regime under the SCT Act to manage or to
consider with respect to the validity of a claim, nor is there a need to
balance competing policy considerations in rendering decisions, nor is there
any discretionary decision making authority at issue. Rather, the role of a
superior court judge acting as a member of the Tribunal with respect to the
validity of a specific claim is to apply similar legal rules as would be
applied by any superior court.
[31]
Certain administrative law decision-makers interpret the legal rules
that courts apply, yet reviewing courts sometime nevertheless defer to them.
For example, a labour arbitrator acting under a collective agreement and
interpreting the general law of issue estoppel is entitled to deference: Nor-Man
Regional Health Authority Inc. v. Manitoba Association of Health Care
Professionals, 2011 SCC 59 [2011] 3 S.C.R. 616. In Dunsmuir at
paragraph 54, the Supreme Court held that deference may “be warranted where an administrative tribunal has
developed particular expertise in the application of a general common law or
civil law rule in relation to a specific statutory context.” But here, as I have already
noted, the Specific Claims Tribunal is to employ the exact same fiduciary law
that courts use, without importing policy considerations or specialized appreciation
into the mix.
[32]
Another important factor affecting the standard of review is that the
adjudications of the Specific Claims Tribunal are not protected by a strong
privative clause: SCT Act section 34. This is a significant indication
that its decisions on the existence of a fiduciary duty are not subject to
deferential review.
[33]
Further, claims involving the existence of a fiduciary duty are not
exclusive to the Specific Claims Tribunal and are also adjudicated before the
superior courts. Indeed, the SCT Act itself contemplates the possibility
that proceedings may arise in the superior courts out of the same or
substantially the same facts: SCT Act subsection 15(3) and section 37.
As noted by Rothstein J. in Rogers Communications Inc. v. Society of
Composers, Authors and Music Publishers of Canada, 2012 SCC 35, [2012] 2
S.C.R. 283, at para. 14, it would be inconsistent for a court to review a legal
question on judicial review of an administrative tribunal on a deferential
standard, while deciding the exact same legal question on a correctness
standard on appeal from a decision at first instance.
[34]
Indeed, it is most important that there be consistency in adjudications
by the Specific Claims Tribunal and courts on issues regarding the fiduciary
relationship between the Crown and aboriginal peoples and the circumstances in
which that relationship entails fiduciary duties. These issues have deep
underlying constitutional underpinnings stemming notably from the Royal
Proclamation, 1763, paragraph 91(24) and section 109 of the Constitution
Act, 1867, section 35 of the Constitution Act, 1982, and other
constitutional instruments. For example, in the case at bar the Judge relied
on a constitutional provision, Article 13 of the British Columbia Terms of
Union, as part of his analysis leading to his finding that a fiduciary duty
was incumbent on the Crown in the circumstances of this case. Inconsistency on
such fundamental matters would be unseemly and give rise to significant
practical consequences.
[35]
For all these reasons, I conclude that correctness is the standard of
review of the Specific Claims Tribunal’s ruling on the question of law at issue
in this case.
[36]
Even if the standard of review were reasonableness, the range of
reasonableness outcomes would be narrow. Constitutional norms and
previously-decided cases related to the Crown’s fiduciary duty severely
constrain the range of acceptable and defensible outcomes open to the Specific
Claims Tribunal with respect to the legal issue at hand. Moreover, additional
constraints are imposed by the underlying constitutional underpinnings and
mandatory norms in this area.
DID THE JUDGE ERR BY CONCLUDING THAT CANADA HAD A FIDUCIARY DUTY TO THE KITSELAS IN THE RESERVE ALLOTMENT PROCESS?
[37]
Canada submits that it had no fiduciary duty with respect to the 10.5
acres excluded from Kitselas I.R. No. 1. First, Canada argues that though the
excluded land may have been habitually used by the Kitselas, “habitual use“ alone is not a cognizable
interest that may give rise to a fiduciary duty since it is insufficiently
specific. Second, Canada further argues that it did not take discretionary
control of the excluded land so as to give rise to any fiduciary duty.
[38]
I do not accept these submissions for the reasons further set out below.
In the specific factual context of these proceedings, I conclude that the Judge
reached the appropriate legal conclusion with respect to the fiduciary duty
owed in this case by Canada to the Kitselas.
[39]
The doctrine of aboriginal rights arose from the assertion of Crown
sovereignty over the aboriginal peoples of the territories now known as Canada. This doctrine limits the original sovereignty of aboriginal peoples by placing them
under the ultimate control of the Crown. These limits, and the resulting
discretion afforded to the Crown in managing its relationship with aboriginal
peoples, have resulted in characterizing the relationship as fiduciary in
nature. The fiduciary relationship implies political duties for Canada when dealing with aboriginal peoples. However, the relationship is not solely
political.
[40]
The fiduciary relationship also finds expression and recognition in the
courts when reviewing government action affecting aboriginal peoples. The
Supreme Court of Canada has thus recognized that the sui generis fiduciary
relationship that binds the Crown and aboriginal peoples colours government
actions with respect to aboriginal matters, notably with respect to the
interpretation and application of undertakings, treaties and legislation
relating to aboriginal peoples, including subsection 35(1) of the Constitution
Act, 1982: R. v. Sparrow, [1990] 1 S.C.R. 1075 at p. 1108 (Sparrow);
R. v. Badger, [1996] 1 S.C.R. 771 at para. 9; Ontario v.
Dominion of Canada and Quebec: In Re Indian Claims (1895), 25 S.C.R. 434 at
pp. 534-535.
[41]
In addition to serving as a guiding principle for courts, the fiduciary
relationship can also lead in certain circumstances to judicially enforceable
fiduciary duties on the Crown when it assumes or exercises a discretionary
power over the rights or interests of aboriginal peoples. For example, in Guerin
v. The Queen, [1984] 2 S.C.R. 335 (Guerin), the Supreme Court of Canada confirmed a lower court monetary award against Canada for mishandling land transactions
involving the lease of reserve land. In so doing, it found that the Crown was
subject to a judicially enforceable fiduciary duty in managing reserve lands.
The Court found the origin of this enforceable duty in the historical
relationship between the Crown and aboriginal peoples, coupled with the nature
of aboriginal title and, in particular, with the proposition that the
Aboriginal interest in land is inalienable except upon surrender to the Crown.
[42]
However, the judicially enforceable fiduciary duties of the Crown
are not limited to transactions involving reserve land. They can be found to
exist “where by statute,
agreement, or perhaps by unilateral undertaking, one party has an obligation to
act for the benefit of another, and that obligation carries with it a
discretionary power”: Guerin
at p. 384. In the Aboriginal context, a fiduciary duty may arise as a result of
the “Crown [assuming]
discretionary control over specific Aboriginal interests”: Manitoba Metis Federation Inc. v. Canada (Attorney General), 2013 SCC 14, [2013] 1 S.C.R. 623, at para. 49, referring to Haida
Nation v. British Columbia (Minister of Forests), 2004 SCC 73, [2004] 3
S.C.R. 511, at para. 18.
[43]
Though a judicially enforceable fiduciary duty does not arise in
every facet of the relationship between the Crown and aboriginal peoples, the
courts have found a fiduciary duty in varied circumstances. Of particular
pertinence to these proceedings, in Ross River Dena Council Band v. Canada,
2002 SCC 54, [2002] 2 S.C.R. 816 (Ross River) at para. 68, LeBel
J. recognized that the reserve creation process presumptively engages the
Crown’s fiduciary duty:
It must be kept in mind that the process of reserve creation,
like other aspects of its relationship with First Nations, requires that the
Crown remain mindful of its fiduciary duties and of their impact on this
procedure, and taking into consideration the sui generis nature of
native land rights.
[44]
As Binnie J. further noted in Wewaykum at para. 89,
aboriginal peoples were “entirely
dependent on the Crown to see the reserve-creation process through to
completion.” This is why the Crown was found to have a fiduciary duty in
the reserve creation process described in that case even though the land at
issue was not formally recognized as reserve land under the Indian Act,
but was only “provisionally
approved”
under the reserve creation process which was applied in British Columbia.
[45]
As noted by Binnie J. at para. 79 of Wewaykum, “[a]ll members of the Court accepted
in Ross River that potential relief by way of fiduciary
remedies is not limited to the s. 35 rights (Sparrow) or existing
reserves (Guerin). The fiduciary duty, where it exists, is called into
existence to facilitate supervision of the high degree of discretionary control
gradually assumed by the Crown over the lives of aboriginal peoples.”
[46]
Wewaykum concerned the scope of the fiduciary duty of the
Crown in the process of the creation of Indian reserve lands in British Colu mbia out of an area which – contrary to the land at issue in this case - was
not part of traditional tribal lands: Wewaykum at paras. 5 and 77.
Binnie J. noted that the fiduciary relationship between the Crown and
aboriginal peoples morphs into a fiduciary duty incumbent on the Crown where a
cognizable Indian interest is at issue and the Crown undertakes discretionary
control in relation thereto in a way that invokes responsibility in the nature
of a private law duty: Wewaykum at para. 85. With those considerations
in mind, Binnie J. concluded the following with respect to the Crown’s
fiduciary duty prior to reserve creation (at paragraph 86 of Wewaykum):
Prior to reserve creation, the Crown exercises a public law
function under the Indian Act – which is subject to supervision by the
courts exercising public law remedies. At that stage a fiduciary relationship
may also arise but, in that respect, the Crown’s duty is limited to the basic
obligations of loyalty, good faith in the discharge of its mandate, providing
full disclosure appropriate to the subject matter, and acting with ordinary
prudence with a view to the best interest of the aboriginal beneficiaries.
[47]
Binnie J. further expanded on the fiduciary duty of the Crown prior to
reserve creation at paras. 94 to 97 of Wewaykum. He reiterated that in
addition to public law duties, the imposition of a fiduciary duty attaches to
the Crown the obligations of loyalty, good faith, and full disclosure
appropriate to the matter at hand, and of acting reasonably and with diligence in
the best interest of the beneficiary. This results in opening access to an
array of equitable remedies in cases where this duty is breached by the Crown.
[48]
This is precisely the approach followed by the Judge in this
case. Relying principally on the teachings of the Supreme Court of Canada in Wewaykum,
the Judge found, at para. 111 of his Reasons, that the high degree of
discretionary control assumed by the Crown over the lives of aboriginal peoples
expressed in Article 13 of the British Columbia Terms of Union could, in
appropriate circumstances, give rise to a fiduciary duty with respect to the
provision or non-provision of reserve lands.
[49]
In this respect, the Judge concluded that the Kitselas had, in the
circumstances of this case, a sufficient cognizable interest in the 10.5 acres
excluded from the reserve so as to trigger the fiduciary duty underlying Article
13, and that the unilateral undertaking of the Crown set out in that Article
was itself sufficient to engage, with respect to the excluded land at issue in
this case, the obligations of loyalty, good faith, and full disclosure and of acting
reasonably and with diligence in the best interest of the beneficiary. The
Judge further found that a breach of such a duty could be dealt with by him
under paragraph 14(1)(c) of the SCT Act:
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14. (1) Subject to sections 15 and 16,
a First Nation may file with the Tribunal a claim based on any of the
following grounds, for compensation for its losses arising from those
grounds:
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14. (1) Sous réserve des articles 15 et 16, la
première nation peut saisir le Tribunal d’une revendication fondée sur l’un
ou l’autre des faits ci-après en vue d’être indemnisée des pertes en
résultant :
|
|
(c) a breach of a legal obligation arising from the Crown’s
provision or non-provision of reserve lands, including unilateral
undertakings that give rise to a fiduciary obligation at law, or its
administration of reserve lands, Indian moneys or other assets of the First
Nation;
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c) la
violation d’une obligation légale de Sa Majesté découlant de la fourniture ou
de la non-fourniture de terres d’une réserve — notamment un engagement
unilatéral donnant lieu à une obligation fiduciaire légale — ou de
l’administration par Sa Majesté de terres d’une réserve, ou de
l’administration par elle de l’argent des Indiens ou de tout autre élément
d’actif de la première nation;
|
[50]
I discern no fundamental legal error in these findings of the Judge.
[51]
In this case, the Judge appropriately had regard to the unique context
of reserve creation history in British Columbia. Contrary to Ontario and most
of Western Canada, reserve creation in British Columbia did not result from a
treaty process, but rather from a unilateral undertaking of the Crown, notably
set out in Article 13 of the British Columbia Terms of Union and in the
various Crown instructions issued to implement that Article. As a result, there
were no negotiations with aboriginal peoples to determine the parameters of the
reserve allotment policy, and the actual allocation of land for reserve
creation purposes was largely left to the discretion of Crown officials acting
pursuant to the instructions they received.
[52]
As the Judge found in this case, the instructions that governed the
implementation of the unilateral Crown policy of reserve allocation in British
Columbia clearly required the Crown officials responsible for the
implementation of the policy to take into account and to have regard to the
actual land uses of the various aboriginal nations for which the reserves were
being created. This is notably reflected in the instructions given by the
Department of Indian Affairs to Commissioner O’Reilly in 1880: “In allotting Reserve Lands […]
[y]ou should have special regard to the habits, wants and pursuits of the Band,
to the amount of territory in the Country frequented by it, as well as to
claims of the White settlers (if any)”:
Reasons at para 15. In essence, as noted in Commissioner Sproat’s report of
1878, “[t]he first
requirement is to leave the Indians in the old places to which they are
attached”: Reasons at
para. 16.
[53]
In this case, the Judge found, as a matter of fact that: (1) the 10.5
acres excluded from Kitselas I.R. No. 1 included the site of an ancient village
of the Kitselas known as Gitaus; (2) from the aboriginal perspective, this
ancient village site had never been abandoned; (3) Indian dwellings were on the
Gitaus site when Commissioner O’Reilly decided to exclude the land from the
reserve; (4) there were no claims of White settlers over the excluded land; (5)
the concerned land was not excluded in anticipation of the use of the land for
public transportation purposes; and (6) had Commissioner O’Reilly recommended
the inclusion of that land in the reserve, that recommendation would have
subsequently been followed by both Canada and British Columbia.
[54]
In the light of those findings of fact, I can find no error of law in
the conclusion of the Judge that the Kitselas had a cognizable interest in the
excluded land that gave rise to a fiduciary duty of loyalty, good faith, and
full disclosure and of acting reasonably and with diligence in the best
interest of the Kitselas in determining whether to include or to exclude that
land from Kitselas I.R. No. 1. The land at issue was clearly delineated and
identifiable, and the cognizable interest in that land was its historic and
contemporary use and occupation as a settlement by the Kitselas
themselves, a land interest specifically contemplated by Article 13 of the British
Columbia Terms of Union and by the Crown instructions issued to implement
that Article.
DID THE JUDGE ERR BY
FINDING THAT CANADA BREACHED ITS DUTY?
[55]
As an alternative argument, Canada submits that even if it had a
fiduciary duty toward the Kitselas with respect to the exclusion of the lands
at issue from the reserve, the Judge erred in finding that it had breached this
duty by (1) failing to disclose the exclusion of the 10.5 acres to the
Kitselas, and (2) failing to act reasonably and with diligence by excluding
more than the one acre required by the Hudson’s Bay Company for its storehouse.
[56]
Canada acknowledges that its submissions attack the findings of
fact made by the Judge, and that consequently a standard of reasonableness
applies in judicially reviewing these findings in our Court. Canada therefore submits that the Judge’s findings are unreasonable in that they fall outside a
range of possible, acceptable outcomes which are defensible in respect to the
facts and the law: Dunsmuir at para. 47.
(a)
Failing to disclose the exclusion
[57]
After an extensive review, the Judge concluded that the evidence, taken
as a whole, did not support a finding that Commissioner O’Reilly informed the
Kitselas of the exclusion of the land in issue from Kitselas I.R. No. 1:
Reasons at para. 182. The Judge further concluded that had the exclusion been
disclosed, the Kitselas would surely have objected: Reasons at para. 181.
[58]
Canada submits that these conclusions are contrary to the evidence, and for
this it relies on various documents reporting discussions between Commissioner
O’Reilly and the Kitselas with respect to the extent of the reserve. I agree
with the Judge that though these documents show discussions were held with respect
to the overall extent of the reserve and its external boundaries, they do not
establish a disclosure of the exclusion of the 10.5 acres, an exclusion which,
as found by the Judge, the Kitselas would surely have objected to in the
circumstances. In this regard, the Judge gave weight to the fact that the
Kitselas themselves had informed the Hudson’s Bay Company in 1892 that the land
at issue was part of their reserve, a fact that would be incompatible with Canada’s submission that they knew of the exclusion: Reasons at para. 177.
[59]
Canada also relies on a plan of the reserve sent to the local
Indian Agent in 1903 showing the land at issue as excluded. Canada submits that the Judge erred at para. 178 of his reasons in concluding that the evidence did
not show that this plan was in fact forwarded to the Kitselas. In Canada’s view, the Judge should have “assumed
that this was done”: Canada’s Memorandum at para. 103(4). I disagree. In light of the evidence before him, it
was open to the Judge to assume the contrary. In the absence of any direct
evidence on the issue, the Judge’s conclusion falls within a range of possible,
acceptable outcomes which are defensible in respect of the facts and the law.
(b)
Failing to act reasonably and with diligence
[60]
Canada further submits that the Judge erred in finding that Commissioner
O’Reilly failed to act reasonably and with diligence in excluding the 10.5
acres from Kitselas I.R. No. 1. Canada notably submits that the Judge erred in
interpreting the Commissioner’s mandate with respect to balancing the claims of
White settlers with those of the Kitselas. In Canada’s view, the Judge erred by
limiting that mandate to ascertaining the existence of claims by White
settlers, rather than being mindful of the larger interests of White settlers:
Canada’s Memorandum at para. 121.
[61]
In Canada’s view, while recognizing that there were no existing claims
of White settlers, Commissioner O’Reilly nevertheless acted reasonably in
excluding the 10.5 acres in light of the site’s strategic importance for public
transportation. As Canada puts it, “[i]n
short, Lot 113 was located at the best location to aid in bypassing or waiting
to ascend the Canyon when it was impassable or too dangerous, as it often was”: Canada’s Memorandum at para.
137.
[62]
The problem with Canada’s submission is that (a) it ignores the
Judge’s finding that Commissioner O’Reilly had already excluded from the
reserve all the land that had the potential for transportation, including the
existing portage along the River: Reasons at para. 92; (b) Commissioner
O’Reilly never specifically referred to the use of the excluded land for public
transportation purposes as a reason to justify excluding it from the reserve:
Reasons at para. 29; and (c) the excluded land was subsequently subdivided and sold
by British Columbia to speculators: Reasons at para. 35. In light of this
constellation of facts, it was reasonably open for the Judge to conclude that
Commissioner O’Reilly did not exclude the 10.5 acres for public transportation
purposes.
DID THE JUDGE ERR BY FINDING CANADA SOLELY RESPONSIBLE FOR ANY LOSSES FLOWING FROM THE BREACH?
[63]
Finally, Canada submits that the Judge erred by finding it solely
liable for the losses of the Kitselas resulting from the breach of the Crown’s
fiduciary duty with respect to the 10.5 acres excluded from the reserve.
[64]
Canada argues that British Columbia also assumes a liability in
this case, and that Canada’s responsibilities with respect to any compensation
owed to the Kitselas should be reduced accordingly. Canada relies for this
purpose on paragraph 20(1)(i) of the Act:
|
20. (1) The Tribunal, in making a decision on the issue of compensation
for a specific claim,
|
20. (1)
Lorsqu’il statue sur l’indemnité relative à une revendication
particulière, le Tribunal :
|
|
(i) shall, if it
finds that a third party caused or contributed to the acts or omissions
referred to in subsection 14(1) or the loss arising from those acts or
omissions, award compensation against the Crown only to the extent that the
Crown is at fault for the loss.
|
i) dans le cas où il estime qu’un tiers est, en tout ou en partie,
à l’origine des faits ou pertes mentionnés au paragraphe 14(1), n’accorde une
indemnité à la charge de Sa Majesté que dans la mesure où ces pertes sont
attribuables à la faute de celle-ci.
|
|
[Emphasis added]
|
[Je souligne]
|
[65]
The difficulty with Canada’s submission on this point stems from the
bifurcation of the proceedings. Under the Judge’s order of July 3, 2012, the
issues of validity and compensation with respect to the claim were bifurcated,
with the understanding that the issue of validity would first be determined
separately from the issue of compensation. As a result, the Judge’s findings in
this case only concern the validity of the claim. The Judge’s conclusion is set
out as follows at paragraph 205 of the Reasons: “[t]he Kitselas First Nation has established a breach
of legal obligation of the Crown due to the non-inclusion of land in excess of
the requirements of the Hudson’s Bay Company (one acre) in Kitselas I.R. No. 1.”
[66]
As is readily apparent from section 20 of the SCT Act, the issue
of any potential third party liability that would reduce the compensation owed
by Canada is determined as a matter related to compensation. In fact, the Judge
made no final finding in his Reasons with respect to the potential liability of
British Columbia affecting the compensation that would be eventually owed by Canada.
[67]
The Judge notes at paragraphs 192 and 193 of his Reasons that Canada assumed the primary role in the relationship between aboriginal peoples and the Crown, and
further assumed sole responsibility over Aboriginal land interests in British Columbia under Article 13 of the British Columbia Terms of Union. However,
those findings are in themselves uncontroversial and largely echo the findings
of Binnie J. at paragraphs 93 and 97 of Wewaykum. They cannot form alone
the basis for a finding with respect to the potential contribution of British Columbia (if any) to the breach which could affect the compensation owed by Canada. Rather, this is a matter to be dealt with at the compensation stage of the hearing
pursuant to the Judge’s bifurcation order.
CONCLUSION
[68]
I would consequently dismiss the application, with costs in
favour of the respondent. There should be no order for costs with respect to
the interveners.
“Robert M.
Mainville”
“I agree.
K. Sharlow J.A.”
“I agree.
David Stratas
J.A.”
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