Decision Date: September 2, 2011

Panel: Alan Andison

Keywords: Forest and Range Practices Act – ss. 52(1), 71; unauthorized timber harvesting; penalty; aboriginal rights; duty to consult; Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73; R. v. NTC Smokehouse [2006], 2 SCR 672

Jack Sebastian and the Suskwa Chiefs Economic Development Corporation (the “Appellants”) appealed a determination issued by the District Manager (the “District Manager”), Skeena Stikine Forest District, Ministry of Forests and Range (the “Ministry”).  In the determination, the District Manager found that the Appellants contravened section 52(1) of the Forest and Range Practices Act (the “FRPA”) by harvesting timber from Crown land without authorization.  Specifically, the Appellants harvested 1,238 cubic metres of timber from areas that were beyond the boundaries identified in three forestry licences to cut.  One licence was held by Mr. Sebastian, and two licences were held by Suskwa Chiefs Economic Development Corporation (the “Corporation”).  For each of the contraventions, the District Manager assessed a penalty of $500 against Mr. Sebastian, and two penalties of $500 and $1500 against the Corporation.

Mr. Sebastian is the chief executive officer of the Corporation, which is a company formed by six Gitxsan Houses to further their economic interests.  The Suskwa Chiefs applied, on behalf of the Corporation, to the Ministry for two forestry licences that would allow the Corporation to perform salvage logging of dead and damaged timber along forest service roads in the territory of one of the Gitxsan Houses.  Mr. Sebastian applied for the same kind of licence, with the intent that the Corporation would perform the work.  In 2006, the Ministry issued the three licences.  Each licence identified the harvesting boundaries.  The Corporation’s employees or contractors harvested under the licences from June to August 2006.

In mid-August 2006, the Ministry notified Mr. Sebastian that the Corporation may have harvested beyond the licence boundaries.  In response, Mr. Sebastian advised the Ministry that all of the harvesting was an exercise of aboriginal rights by the owners and stewards of the Gitxsan House’s traditional territory.

In November 2008, the District Manager issued the determination.  At no time did Ministry staff engage in any consultation with Gitxsan representatives about their asserted aboriginal rights or title, or how the Ministry’s enforcement actions might impair those rights.

The Appellants appealed the determination on the basis that the Ministry had a duty to consult with the Gitxsan about their aboriginal rights during the investigation and enforcement proceedings, and that the Ministry’s failure to do so violated section 35(1) of the Constitution Act, 1982.

The Government argued that the District Manager had no duty to consult in this case.  It submitted that the Appellants are a corporation and its director/officer, and they were engaged in a commercial forestry operation outside the scope of any aboriginal rights.  In addition, the District Manager had no jurisdiction to consider claims of aboriginal rights in an enforcement proceeding.  Moreover, any duty of consultation that may have existed was met, because representatives of the Gitxsan obtained the licences and agreed to the licence terms.

The Commission found that the aboriginal rights being asserted are held by the Gitxsan as a group, and the harvesting was carried out by Mr. Sebastian and the Corporation as the Gitxsan’s representatives.  Further, the Commission found that the decision in R. v. NTC Smokehouse [2006], 2 SCR 672, applies in this case, and it indicates that corporate entities may rely on a First Nation’s claim of aboriginal rights as a defence to a regulatory proceeding.  Consequently, the Commission held that the Appellants could rely on any aboriginal rights claimed by the Gitxsan as a defence to the enforcement action, because the Appellants were acting on behalf of and with the full authority of the Gitxsan when they applied for the licenses and undertook the harvesting.

Next, the Commission considered the test set out in Haida Nation v. British Columbia (Minister of Forests), 2004 SCC 73 (“Haida”), and whether a duty to consult with the Gitxsan was triggered by the Ministry’s investigation and enforcement proceedings.  The Commission held that a duty to consult with the Gitxsan was triggered because: (1) the Crown, as represented by the Ministry, knew of the existence of the Gitxsan’s claims of aboriginal rights, including title, in relation to the lands where the harvesting occurred; and (2) the Crown contemplated conduct that might adversely affect the Gitxsan’s aboriginal rights.  Specifically, the Commission found that the Crown knew that the Gitxsan claimed aboriginal title, including a right to the land itself and to govern the forest resources, on the lands where the contraventions occurred.  The Commission noted that according to Haida, the Crown is entitled to manage resources pending the resolution of aboriginal rights claims, but the Crown may not do so in a manner that deprives the aboriginal claimants of the benefits of the resources.  The Commission held that the Ministry’s investigation and enforcement proceedings had the effect of penalizing the Appellants, and consequentially the Gitxsan, for harvesting timber that they claim to own and claim to have a right to manage.  The Ministry’s action sent a clear message to all Gitxsan that they will face penalties for harvesting timber in areas where they assert title unless they seek and receive Crown authorization for harvesting.  The Commission held that it was irrelevant that that the Appellants held licences for some of the areas they harvested, because the effect of the enforcement actions on the asserted aboriginal rights was the same as if they had proceeded to harvest without ever holding any licences in the area; namely, the penalties were for unauthorized timber harvesting, not for violating the terms of the licences per se.  In addition, the Commission found that the enforcement actions proceeded without any consideration of the effects of the penalties on the Gitxsan’s claim of title to the area, and the District Manager proceeded without any consultation with the Gitxsan.

The Commission then considered whether the Appellants’ claim that consultation was required amounted to a collateral attack on the Province’s validly enacted regulatory scheme.  The Commission found that the Appellants’ claim was not a collateral attack on the Province’s forestry legislation.  Rather, the Appellants were asserting a valid defence, arising from constitutionally recognized rights, to a finding of contraventions and the issuance of penalties under the Forest and Range Practices Act.

Finally, the Commission considered what remedy was appropriate in the circumstances.  The Commission held that its powers on an appeal are limited to what is provided in its enabling legislation, and the Commission has no jurisdiction to declare the District Manager’s determination to be a nullity as requested by the Appellant.  Given that no consultation occurred before the determination was made, the Commission found that the determination and the associated penalties should be rescinded.

Accordingly, the appeal was allowed.