Consultation is a two-way street and the Crown must do more than take notes

Tsleil-Waututh Nation v Canada (Attorney General) 2018 FCA 153

On August 30th, 2018 the Federal Court of Appeal (“FCA”) unanimously quashed Canada’s decision to approve the expansion of the Trans-Mountain Pipeline (the “Project”). The court’s decision focused on two key errors, one by the National Energy Board (“NEB”), and one by Canada. First, the court found that the NEB unjustifiably limited the scope of the Project review by expressly excluding Project-related marine shipping from the definition of “designated project” under the Canadian Environmental Assessment Act, 2012 (“CEAA 2012”) . This exclusion was an impermissible flaw such that the Governor in Council (Canada) could not rely on the NEB’s report when assessing the Project’s environmental effects and the overall public interest.

Second, Canada failed to adequately consult with First Nations impacted by the project. The FCA found that while the consultation framework was adequate, and that Canada adequately understood and recorded First Nation concerns, there was no meaningful consultation, since there was no effective two-way dialogue between the parties, nor proposed accommodation measures.

Marine Traffic and Killer Whales

Before issuing a certificate of public convenience and necessity under the National Energy Board Act (“NEB Act”) , the Governor in Council must be in receipt of a report prepared by the NEB in accordance with the requirements of the NEB Act and CEAA 2012. The NEB is tasked with reviewing the Project application and assessing whether the Project would be in the public interest. Pursuant to CEAA 2012, the NEB is required to take into account environmental effects and effects on Aboriginal peoples.

In this case, the NEB report concluded that the operation of Project-related marine vessels is likely to result in significant adverse effects to the Southern resident killer whale and on Indigenous cultural uses associated with the species. However, the NEB report did not consider these impacts in their final analysis of the Project, defining the increase in marine traffic as outside of the scope of the “designated project.” Excluding these effects from the scope of its review allowed the NEB to conclude that the Project was not likely to result in significant adverse effects, and to avoid applying the Species at Risk Act to its consideration of the effects of Project-related marine shipping on the Southern resident kill whale.

The FCA found that the NEB’s decision to exclude Project-related marine traffic from the definition of “designated project” was not justifiable.

The FCA ruled that if the NEB had included Project-related marine traffic in the scope of review, the Species at Risk Act would have required the NEB to consider measures to avoid or lessen the impact on the Southern resident killer whales. While the NEB could not regulate shipping, it should have considered mitigation measures which could be imposed by the final decision maker and included recommendations in its report. The Governor in Council had the authority to ensure that the Project was not approved until the mitigation measures were in place, but lacked the necessary information to make the decision required of it.

The FCA held that the unjustified exclusion of Project-related marine shipping from the Project definition resulted in a report that was “so deficient that it could not qualify as a ‘report’ within the meaning of the legislation and it was unreasonable for the Governor in Council to rely upon it.”

Consultation not adequate

The Indigenous applicants challenged the Governor in Council’s decision on the basis that Canada had failed to consult adequately with them. The FCA ruled that the consultation process adopted by Canada was adequate, including the unilateral determination of which process to use. In the court’s view, Canada’s reliance on the NEB process to fulfil all or part of the duty to consult was acceptable and did not change the NEB’s role as neutral arbitrator. The court also held that there was insufficient evidence to demonstrate that lack of participant funding rendered consultation unreasonable, and the court found it was acceptable to approve the Project despite potential impacts to title and right remaining to be determined by future studies.

However, the FCA found that Canada failed in its execution of the consultation process. Consultation requires “responsive, considered and meaningful dialogue coming back from Canada in response to the concerns of the Indigenous applicants.” The Court confirmed that the Crown must be prepared to make changes to its proposed actions based on information and insight obtained through consultation, but in this case Canada did not do so. The FCA pointed out three key errors: the mandate of Canada’s consultation team limited its role to that of note-takers; Canada was unwilling to depart from the NEB’s findings and recommended conditions; and Canada had an erroneous view that it was unable to impose additional conditions on Trans Mountain.

Further, the impacts of the Project were not assessed on a specific basis for each affected Indigenous group. Canada’s assessment of Project effects on the Indigenous applicants was critical to establishing the depth of consultation required. However, the Crown Consultation Report was not released until early November, 2016, leaving Indigenous groups just two weeks to respond to Canada’s view “that the Project did not have a high level of impact on the established and asserted rights of the Indigenous applicants.” The Governor in Council approved the Project on November 29, 2016. The FCA found that the consultation process “was missing a genuine and sustained effort to pursue meaningful two-way dialogue.” Canada’s response was “generic and vague,” with Canada suggesting Indigenous concerns could be addressed in the future, outside the scope of the Project and after its approval. No additional accommodation measures were suggested by Canada to address Indigenous concerns.

While this case did not create new consultation law, the FCA confirmed what Indigenous groups have been saying for many years: consultation must result in concrete accommodations and the Crown cannot establish an empty process that takes note of concerns without also taking clear steps to address those concerns. We anticipate that the limitations of the NEB process will continue to pose significant challenges for Indigenous groups – such as the procedures for challenging proponents’ evidence, and limited participant funding – notwithstanding some of the Court’s positive findings about the mechanics of the process.