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Clear as Mud: The Legal Implications of Land Use Planning in Yukon

February 13, 2023 Business Law Bulletin 7 minute read

A January 31, 2023 decision of the Yukon Supreme Court has raised serious questions about how permitting decisions will be affected in cases where the government has established ad hoc “land use planning” initiatives rather than adhering to the planning processes set out in the Final Agreements and related implementing legislation with Yukon First Nations.

Background

When the Yukon Final Agreements were signed with 11 First Nations between 1993 and 2005, one could reasonably have thought that the land use planning regime (reflected in Chapter 11 of the Umbrella Final Agreement) would provide increased certainty and clarity going forward.  After all, it set out a relatively clear process for developing land use plans, with extensive involvement of the Treaty Nations and specific requirements to “establish time limits for the carrying out of each stage of the process “ and “provide for public participation in the development of land use plans”. While there has been important case law challenging government actions under Chapter 11, it related primarily to whether the treaty terms had been followed – it did not complicate the legal order.[1]

Yet, so far, Chapter 11 land use plans have been approved under only two[2] of the 11 Final Agreements.  What then becomes of the Crown lands that are outside these areas but within the treaty settlement areas? Are they subject to any “certainty”?

The Facts and Arguments

The First Nation of Na-Cho Nyäk Dun (“FNNND”) brought an application for judicial review of a decision by the Yukon Government relating to its approval of a Class 3/4 Quartz Mining Land-Use Approval for Metallic Minerals Corp.’s (“Metallic”) LOTR Project (the “Project”).  The Project is located in the Tsé Tagé (Beaver River) watershed area of the traditional territory of the FNNND.  The Tsé Tagé watershed area is currently the subject of an Intergovernmental Agreement entered into between the Yukon government and the FNNND as a result of a previously proposed project by another proponent.  The Intergovernmental Agreement provides for the negotiation of an ad hoc land use plan relating to the Tsé Tagé watershed area (the “BRLUP”).

The parties agreed that the Yukon government had a duty to consult with the FNNND with respect to the land use approval for the Project, however, the parties differed on the extent and content of the consultation that was required.  The Government’s view was that moderate consultation was sufficient, whereas the FNNND argued for deep consultation as a result of the potentially adverse consequences to various treaty rights.

In addition to the arguments relating to the lack of proper consultation noted above, the FNNND argued that the government decision allowing a mining exploration project to proceed in the Tsé Tagé watershed area before the completion of a targeted land use planning process contemplated by the Intergovernmental Agreement for that area, undermines and infringes their protected treaty rights in the context of the promise of land use planning set out in Chapter 11 of the Final Agreement. The FNNND further argued that any approval of the Project to the next stage would detrimentally affect the FNNND Treaty rights to participate meaningfully in the management of lands and resources in their traditional territory and their treaty rights to carry out traditional practices in this area.

The Yukon government’s position throughout was that Chapter 11 of the Final Agreement is not relevant to or engaged by the decision under review. They argued that there is no legal requirement for the implementation of the land use planning process set out in Chapter 11 because it sets out a voluntary and collaborative process the parties may choose to follow for land use planning. Their view is that once Chapter 11 is chosen, it must be followed, but it requires agreement of both the First Nation and government to enter into the process and to agree on the various steps within the process. There is no legal obligation in Chapter 11 or anywhere in the Final Agreement that economic development projects in the traditional territory cease until land use planning is completed. The Yukon government says that Chapter 11 does not create treaty rights.

Interestingly, Metallic did not participate in the judicial review (though it had the right to do so).

The Decision

The Court found that the decision was contrary to the Crown’s duty to consult – based on a fairly well-settled body of law (although the application of these principles to the facts of this case is not easy to follow). The Court found that consultation towards the higher end of the spectrum was required and it must include discussion about the land use planning process, specifically the ongoing Intergovernmental Agreement land use planning process. The failure to do so created an adverse impact on the FNNND treaty right to participate meaningfully in the land and resource management of their traditional territory.  The Court went on to find that:

“the consultation should also have included meaningful discussion about the consultation process, including community consultation. The failure of the Yukon government to consult as legally required was a breach of the honour of the Crown and rendered the decision unlawful.”

The Court could have stopped there.  But it did not.

Instead, the Court went on to make two rather novel declarations.

First, while the Court did not find any breach of the treaty, it did issue a declaration, based on “Honour of the Crown” principles, that “the Yukon government breached its duty to act in a way that accomplishes the intended purposes of the Treaty [emphasis added].  In doing so the Court stated:

“Although it is not being negotiated under the Chapter 11 process, the BRLUP is a way of fulfilling one of the purposes of the Treaty…The implementation of the Intergovernmental Agreement is Crown conduct that helps to fulfill the Treaty purpose of meaningful participation of management of land and resources in the traditional territory. The honour of the Crown applies to the Crown’s actions in relation to the Intergovernmental Agreement.”[3]

And further, at para. 202 the Court stated:

“In oral argument, counsel for the FNNND clarified that they are not arguing in this case that the absence of a land use plan under Chapter 11 is a breach of the honour of the Crown that should result in the setting aside of the decision or a declaration. The FNNND argue instead that the purpose, principles, and values emanating from Chapter 11 should have informed the government decision in this case”

While the decision cites various cases dealing with the Honour of the Crown in principle, the reasoning is difficult to follow in terms of its application to this case (where a separate treaty right to land use planning still exists and there is no suggestion the government was refusing to recognize it or entertain it).[4]

To the authors’ knowledge this is the first time a Court has ever issued a declaration regarding a duty to act in a way that accomplishes the intended purposes of the Treaty without a treaty right, or an action under a treaty, actually being at issue in the litigation.

And if this is possible, then it is difficult to imagine what other areas of government activity would not also be subject to similar judicial scrutiny and declaration based on the Honour of the Crown in any case where a comprehensive treaty exists. That in turn may raise further questions about the Honour of the Crown concept itself.  As noted by the Centre for Constitutional Studies at the University of Alberta:

“…Justice Slatter of the Alberta Court of Appeal has criticized the term “honour of the Crown” for being imprecise and so vague as to have no real legal meaning.[36] Professor Mariana Valverde echoes this criticism, arguing that the honour of the Crown is a “mystical legal tradition” that defies clear definition.[37] Justice Slatter frames it as having “an absolute, moralistic and inflexible connotation … [which] can lead to conclusory reasoning and results oriented jurisprudence if applied directly to legal issues.”[38] In other words, if a party argues that the Crown failed to act honourably, the Courts have no meaningful yardstick for measuring what “honourably” means. For these critics, judges have too much discretion on how to use and apply the “honour of the Crown” in their decision-making.”[5]

Second, the Court granted a “declaration that the Yukon government breached its duty of good faith in the performance of [an] Intergovernmental Agreement…”  This agreement was not part of a chapter 11 land use planning processing.  It did not have the force of law.  It was not required by the duty to consult.

But the Yukon government was held to have breached a “duty of good faith” when it “fail[ed] to consider the effect of the decision on the ongoing land use planning process under the Intergovernmental Agreement”.

To reiterate – the Court did not say the government breached its agreement with the First Nation.

The Court said it failed to consider the effect of its decision on the non-treaty, non-legislated land use planning process established in an agreement between the Yukon government and the First Nation.  Again, this is to the author’s knowledge the first such declaration of this nature ever issued by a Canadian Court, and raises questions about how far the Court’s can go in overseeing government conduct on the basis of a duty “to act in good faith”.

The Implications

Taken together, these two declarations will make it increasingly difficult for companies doing business in areas covered by the Yukon Final Agreements to know what can or cannot be permitted when there is no Chapter 11 land use plan, and where ad hoc land use planning processes are being undertaken outside of the treaty or any legislative framework.

The declarations could also reduce the incentive for Treaty First Nations to seek to develop and support section 11 land use plans – something that should concern anyone interested in certainty.

Finally, the declarations may invite other Courts to further expand the use of declarations about government conduct based solely on alleged breach of the “Honour of the Crown” and “duty of good faith”, without any tethering to a dispute about underlying legal rights or potential impacts on same.

The Government of Yukon has 30 days from the judgment to determine whether it will appeal.  As of the date of writing, no such decision has been announced.

[1] See The First Nation of Nacho Nyak Dun v Yukon, 2017 SCC 58.
[2] See Learn about regional land use planning.
[3] Para 138.
[4] At para. 204 the Court notes, “The Yukon government says the absence of a completed land use planning process under Chapter 11 for the Northern Tutchone Planning Region (where most of the FNNND traditional territory lies) has not been for lack of effort by any party, but due to external complexities, competing obligations and capacity issues. The Yukon government says it has fully participated in the Chapter 11 land use planning process and never refused to implement it.”
[5] See Honour of the Crown.

by Andrew Spencer and Robin Junger

A Cautionary Note

The foregoing provides only an overview and does not constitute legal advice. Readers are cautioned against making any decisions based on this material alone. Rather, specific legal advice should be obtained.

© McMillan LLP 2023

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