Indigenous Law Update: What the B.C. Natural Resource Sector Should Know About “Non-Treaty” Agreements

Indigenous Law Update: What the B.C. Natural Resource Sector Should Know About “Non-Treaty” Agreements

Summary

Government has increasingly turned to “non-treaty” agreements with Indigenous groups in British Columbia (B.C.).  These “non-treaty” agreements (and the processes used to negotiate them) do not benefit from oversight by the B.C. Treaty Commission, so they can raise greater risks for businesses and tenure holders.  This article discusses these risks, and some techniques that can be used to mitigate them.

Background

The B.C. Treaty Commission was established in 1992 to facilitate treaty negotiations among the Governments of B.C., Canada and participating Indigenous groups.  At the time, it was considered an essential process to resolve the complex issue of Indigenous land claims, and the related question of who has authority to govern what in B.C.  While the issues were not unique to B.C., they were most pronounced in B.C. given that historic treaties were never entered into for the majority of the province.

Yet, after more than 30 years, and more than a billion dollars in negotiating costs, the treaty commission process has produced very limited success.  It has yielded only three modern treaties that are in implementation today.[1] This is a small percentage of the more than 200 First Nations in B.C., and the more than 100 bands that have participated directly or indirectly in the treaty commission process.

Benefits of the Treaty Process for Businesses Operating in B.C.

From early on in the treaty processes, businesses and third parties were keenly interested and significantly engaged.  As one of the authors of this bulletin noted first hand while serving as a chief provincial treaty negotiator, there were extensive engagements with local governments, business groups, stakeholders and the general public. Some negotiating sessions were open to the public. Comprehensive “land status” exercises were undertaken to ensure that third party interests were fully considered, including compensation where appropriate.

In 2002, the B.C. Government went so far as to hold a (much maligned) provincial referendum on treaty negotiations, which included questions such as this:

The terms and conditions of leases and licences should be respected; fair compensation for unavoidable disruption of commercial interests should be ensured. (Yes/No)

Businesses also generally benefitted from the resulting treaties (where they were achieved) in terms of legal clarity.  The treaties spelled out the law-making authority of First Nations – principally related to their own members and, in some cases, third parties.  Detailed rules were set out for dealing with any conflicts, and the agreements were given clear legal effect through federal and provincial implementing legislation, thus making the treaties part of the laws of Canada and B.C.

The Rise of “Non-treaty Agreements”

While the B.C. Treaty Commission process has been famously slow to produce, the exact opposite can be said about the more recent proliferation of other agreements that are often referred to as “non-treaty agreements”.  These agreements are between the Government of B.C. and Indigenous groups, and sometimes with the Government of Canada as well.  They carry various names such as strategic engagement agreements, economic and community development agreements, collaboration agreements, reconciliation agreements, co-management agreements, forest consultation and revenue sharing agreements, etc.  Whatever the name, they often involve complex decision-making processes related to First Nation engagement and regulatory decision-making.  And they often go well beyond the Crown’s “duty to consult” that the Supreme Court of Canada has established.

Some of the Challenges with Non-treaty Agreements

While there may be some benefits to non-treaty agreements, they also raise numerous risks and concerns that businesses in the natural resource sector (which rely heavily on government permitting and land use planning) may not be aware of.  These include:

• Permit applications previously administered by government (both federal and provincial) subject to the Crown’s duty to consult, can now (where a non-treaty agreement exists) fall into a more complex and lengthy process that the applicant is neither a participant in nor privy to.
• Government may seek to impose unsolicited amendments on permit holders, following confidential discussions that occur between the government and Indigenous groups under a non-treaty agreement.  From the permit holder’s perspective, they can come “out of the blue” and may not have any grounding in law.
• Unlike the treaty commission process, there is no structured process for negotiating non-treaty agreements and there is no corresponding process to ensure engagement with potentially affected third parties.  Instead, the decision about whether and how to engage third parties is left entirely to the discretion of government (usually non-elected officials).  This has lead to numerous cases where third party consultation has been nonexistent or insufficient. Moreover, trying to fix problems after the agreement has been signed is, not surprisingly, extremely difficult.
• Legal principles of administrative fairness require third parties to be consulted when government is contemplating actions that may affect their interests, but this may conflict with the desire of government and Indigenous groups to have the negotiation of non-treaty agreements privately. When confronted with this conflict, government officials may at times deny that the duty to third parties exist, or claim that the duty has been met.
• There appears to be a growing trend in non-treaty negotiations to deal not only with planning and permitting issues, but also with compliance and enforcement matters. This creates complex dynamics, and potentially even anti-corruption concerns, in circumstances where an Indigenous group may be seeking or receiving economic benefits from a specific business or business association while at the same time having influence over statutory compliance and enforcement decisions involving the same business or business association. A lack of access to these documents makes this problem worse.
• Because non-treaty agreements do not need to be given legal effect through implementing legislation, they may not be subject to the same drafting rigour as treaties.  While vague terms commitments may help the negotiators reach “a deal”, they are often just a recipe for more delays and complications as far as a permit applicant is concerned.
• Despite the fact that they do not have the force of law, provincial officials often treat these non-treaty agreements as though they are binding. Trying to persuade provincial officials that other legal principles mandate deviation from what they feel is required by one of those agreements is rarely successful.  Instead, challenges by proponents are often met with pro forma statements about government’s commitment to reconciliation.
• There is a concern such non-treaty agreements may illegally fetter the discretion of statutory decision makers (i.e. tie their hands in terms of how applications are managed and decided) which the law does not allow. The bureaucracy routinely disputes any such allegations, and refers to a typical clause at the end of such agreement stating something like “nothing in this agreement fetters the discretion of statutory decision makers.”  But saying it is so surely does not make it so, and this is an area where we believe more litigation is likely to occur.

Non-treaty Agreements that are Implemented Through Legislation

Some (albeit not many) non-treaty agreements are implemented through legislation.  This includes the B.C. Government’s recent passage of the Haida Nation Recognition Act (the “Act”), which came into force on July 18, 2023.

The legislation is extremely brief (it has only three substantive sections) and the lack of detail raises many questions.  For example:

Can the Haida Govern Non-Haida Members and Private Lands and Tenures?

Section 1 of the Act states that the Haida Nation Council has “inherent rights of governance and self-determination”.  There is however no clarity as to what the term “governance” means, who it applies to, what its limits are, and on what terms the “governance” powers of the Haida Nation Council can be exercised.

The underlying (non-treaty) recognition agreement[2] that was the genesis for the Act differs in material respects from the legislation itself. That reconciliation agreement contemplated Provincial Recognition Legislation (being an act of the Legislature to give effect to certain sections of the agreement) that acknowledged the “inherent rights of governance and self- determination of the Haida Nation.” [emphasis].  Yet the Act’s reference to governance powers does not contain the qualifier “of the Haida Nation”.  The resulting question is, “Does this law give the Haida Nation Council the ability to govern non-Haida Nation people and their lands?”  The disparity between this brief reference to “governance” power in the Act and the extensive jurisdictional scope and law making provisions under the treaty commission process is striking.

What Might Happen that Should Warrant Immunity from Lawsuits?

Section 7 of the Act provides immunity from any legal proceedings for any good faith action of a public official of the Haida Nation Council (though the Council may remain vicariously liable for the public official’s wrongdoing).  This begs the questions, “Why is this necessary? What actions might be taken by Haida Nation public officials that might otherwise result in lawsuits? Why are such lawsuits being prevented?”

How Does this Act Relate to the Haida Nation Reconciliation Act S.B.C. 2010 chapter 17?

The Haida Nation Reconciliation Act was passed in 2010 and it renamed the Queen Charlotte Islands Haida Gwaii.  It also established a co-management regime for forestry, protected areas and heritage sites, to be administered by a “Haida Gwaii Management Council” (“HGMC”).  The HGMC consists of two members appointed by the Haida Nation, two by the B.C. Cabinet and a jointly appointed chair.  Members of the HGMC have the authority to make high-level, strategic management decisions in specific land and resource areas. Decisions of the HGMC are by consensus and only in the event of a tie vote, the Chairperson is called upon to be the deciding vote.  Specifically, the HGMC’s current areas of authority for decision making include the use and management of land and resources on Haida Gwaii, determination and approval of the allowable annual cut for Haida Gwaii; approval of management plans for protected areas; and development of policies and standards for the identification and conservation of heritage sites.  It is not clear whether, how or to what extent the role of HGMC will change given the governance powers of the Haida Nation Council referenced under the more recent Haida Nation Recognition Act. Particularly since it appears the HGMC has not been very active in recent years as the HGMC has not published any meeting minutes since February 2019 nor issued a news release since May 2020.

The debates in early readings of Bill 18 Haida Nation Recognition Act provide some limited insight into the Haida Nation Council’s role going forward and it seems the aim is to legally recognize the Haida Nation Council as the Haida Nation’s governing body. During the second reading, it was raised that the Council of the Haida Nation has operated as the Haida Nation’s national-level government for 40 years, and that the B.C. Government should formally recognize it as such.[3] It was further asserted that the new legislation enables the Haida Nation Council to assume the agreements, assets and other obligations held by the Secretariate of the Haida Nation, an incorporated society which will subsequently be dissolved.  Lastly, it was noted that federal companion recognition legislation is forthcoming, likely within the next year.[4]

At the committee stage, the official opposition sought an explanation as to the scope and extent of the “inherent rights of governance and self-determination” that are referred to in clause 1(a) of the Act.[5] The response of the Minister was that “these rights are deliberately not defined in this bill […] because, of course, they evolve with the jurisprudence as courts pour more meaning into words in section 35 and define what inherent rights mean.”  He went on to note that future negotiations between the Haida Nation Council, the Province, and the Federal Government will further define the exact scope of this clause.[6]

In summary, it appears as though the Haida Nation Council will continue to operate as it has done for the past several decades, but its scope of governance remains unclear and will require clarification in future negotiations and is therefore subject to change as result of such negotiations or the forthcoming federal companion legislation. Moreover, the HGMC’s inactivity in the past few years creates further uncertainty as to what role, if any, the HGMC will have under the Act.

Is it Constitutionally Protected (Like a Treaty) or Isn’t it?

This is an important question because it can affect the ability of governments to legislate in this area in future.

Section 9.9 of the recognition agreement states “This agreement is not a treaty but is a Recognition Agreement”.  And section 7.4 of its underlying “framework agreement”[7] states that the framework agreement “… is intended to lead to Reconciliation Agreement(s), which will be protected under the … Constitution Act, 1982.”

Does this mean the parties believe the recognition agreement which is (implemented by the Act) is constitutionally protected?  If so, how does this square with section 35 of the Constitution Act, 1982 which provides constitutional protection to “treaty rights” (not other agreements)?

While some of these points may seem technical and legalistic, they are important and could profoundly affect the long term rights of businesses and third parties, particularly if the approaches being taken on Haida Gwaii were to be applied elsewhere in B.C. and further displace the B.C. Treaty Commission going forward.  Yet it appears this matter has received remarkably little attention (or at least public attention) from the business community to date.

Risk Management Techniques in the Non-Treaty Era

There are no easy answers to the challenges noted above, but there are a number of steps businesses and businesses associations can take to help mitigate and manage the risks. These include the following:

Be vigilant – Work proactively, through various channels, to identify ongoing or pending negotiations that may affect you interests.  Do not rely on government to proactively let you know when it is negotiating something that may affect your interests.  In our experience, government adopts a very narrow definition of “your interests”, and consultation, if it comes at all, will be too little and too late.

Remember that law is not a dirty word – State clearly and consistently your expectation that government officials comply with common law principles of administrative fairness, and noting that government cannot by mere agreement (with an Indigenous group or anyone) override those legal obligations owed to third parties.

Do not go gently – Avoid the temptation to “just go along with it” in the hopes that everything will work out fine if you just keep quiet. In our experience, this is almost always a recipe for problems, and the longer important issues go without discussion, the harder they become to manage.  Those chickens will come home to roost.

Have the hard talks – Recognize that building and maintaining good relations is not inconsistent with appropriate, and respectful, pushback where necessary. Even in cases where government or Indigenous groups may express opposition to certain questions or positions, in our experience it is often possible to separate the people from the problem, and to have frank discussions about these matters.

Beware of the “more flies with honey” approach – This approach is rarely a good strategy.  It typically does not work with government and in fact can have the opposite effect.  In our experience, governments and government officials are typically more worried about avoiding controversy, litigation and damage to investor confidence than they are interested in rewarding companies that “don’t make waves”.

Litigate if (and only if) necessary.  While litigation should always be considered a last resort, it is not illegitimate or disrespectful to seek the court’s intervention and guidance on novel and complex issues. Furthermore, a serious and credible commitment to litigation is at times sufficient to get government to reconsider its position regarding the protection of third party business interests in the non-treaty agreement context.  However, the change in government position often only comes on, or close to, the courthouse steps.

Don’t let politics blind you – Hold both the government and the opposition accountable for legislative changes.  More specifically, demand the legislative opposition (no matter which party that is) ask thoughtful and hard questions about any legislation designed to implement non-treaty agreements.  A review of Hansard indicates that Bill 18 Haida Nation Recognition Act drew hardly any critical debate.[8] Asking hard questions need not be a partisan political exercise, and it need not be seen as contrary to the spirit of true and honest reconciliation. It is the obligation of the opposition, as an integral part of our system of government, to ask such questions even if they might be considered politically sensitive.

True reconciliation is hard work.  It requires an open mind and a willingness to view things differently than one might have in the past.   It also requires a willingness to ask hard questions, demand fairness for all parties and use legal means (including courts) to protect one’s rights where essential.

[1] These are the Maa-nulth, Tla’amin and Tsawwassenn Final Agreements.  The Maa-nulth treaty covers five related groups.  Another Final Agreement has been ratified with the Yale First Nation, but implementation has been delayed.  The Nisga’a Final Agreement was negotiated before all the above, outside the B.C. Treaty Commission process.
[2] See Nang K̲’uula • Nang K̲’úulaas Recognition Agreement.
[3] British Columbia, Official Report of Debates of the Legislative Assembly (Hansard), 42nd Parl, 4th Sess, No 308 (20 April 2023) at 10578, online (pdf).
[4] Ibid.
[5] British Columbia, Official Report of Debates of the Legislative Assembly (Hansard), 42nd Parl, 4th Sess, No 314 (26 April 2023) at 10864, online (pdf).
[6] Ibid at 10865.
[7] See GayGahlda Changing Tide Framework Agreement (pdf).
[8] Progress of Bills.

by Joanna Dawson, Cory Kent, Robin M. Junger, Julia Loney, Tim Murphy and Joan M. Young

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.

© TRC-Sadovod LLP 2023