Decision Date: March 6, 2006

Panel: David Ormerod

Keywords: Interior Appraisal Manual – s.6.3.1; stumpage advisory notice; stumpage billing records

Sivert Smith Andersen and Shawn Andersen (the “Appellants”) appealed a Stumpage Advisory Notice (the “SAN”) issued by the Timber Pricing Officer, which set the stumpage rate for spruce and lodgepole pine at $25.80/m³ for the billing year August 1, 2005 to July 31, 2006.  The Appellants asked the Commission to rescind the SAN and order the rate to be $0.25/m³.  In the alternative, they asked the Commission to send the SAN back to the Timber Pricing Officer for re-assessment based on the adjustments made to the “billing records”.

The parties agreed that there were no initial (“primary scale”) stumpage billings during period for which the rate was set, only adjustments.  However, the Appellants argued that the Timber Pricing Officer had no legal authority to apply the district average stumpage rate when there were billing records available to calculate the weighted average sawlog stumpage rate (“WASSR”), to exclude “adjustments” from its definition of billing record, or to require “hauled volume” to calculate the Appellants’ stumpage.  The Appellants submitted that the term “stumpage billing records” in section 6.3.1(2) of the Interior Appraisal Manual (“IAM”), include any scale billing that occurred in the specified period, and not just primary scale data.

The Government submitted that it was obvious from the words used in the IAM that there must be actual billings, not corrections or adjustments alone, for the WASSR to apply.  Therefore, the Government argued that the district average stumpage rate applied, pursuant to section 6.3.1(1) of the IAM.

The Commission found that adjustment records are part of what the IAM refers to as the “sum of stumpage billed according to stumpage billing records … for the twelve-month period ….”  The Commission found that these adjustment records are for adjusted stumpage invoices, and they are properly part of the billing record for the billing year.

The Commission also found that whether or not the adjustments are negative or positive was irrelevant for the purposes of determining if adjustments form part of the sum of the stumpage billed in section 6.3.1(2) of the IAM.

The Commission concluded that in the IAM, the Minister intended to tie the stumpage rate assessment to billing history.  Consequently, the Commission found that the stumpage billing records, although they do not include any primary scale data and only consist of adjustments made for the final bill, can be applied in determining the stumpage rate for blanket salvage cutting permits for the period August 1, 2005 to July 31, 2006, pursuant to section 6.3.1 of the IAM.

The Commission referred the matter back to the Timber Pricing Officer with directions to re-determine all of the billing records, including “adjustments”, pursuant to section 6.3.1 of the IAM.

The appeal was allowed.