Nunatsiavut v Canada

The Federal Court released a decision on April 17, 2015 in Nunatsiavut v. Canada (Attorney General), dismissing an application for judicial review of a decision of the Minister of Fisheries and Oceans authorizing impacts to fish and fish habitat through the construction of the Muskrat Falls hydroelectric project in Labrador.


In 2006, Nalcor Energy initiated an environmental assessment process for the development of two hydroelectric facilities on the lower Churchill River in Labrador, which include dams at Muskrat Falls and Gull Island. A Joint Review Panel (JRP) was appointed by the federal and provincial governments to conduct the assessment based on, among other things, the opinion of the Department of Fisheries and Oceans (DFO) that the project was likely to cause significant adverse environmental impacts.

The applicant, the Nunatsiavut Government, represents the Inuit of Labrador. Nunatsiavut sought to be consulted in relation to the proposed project based on concerns that it could affect a zone where Nunatsiavut has harvesting rights under the Labrador Inuit Land Claims Agreement (the “Agreement”) through the bioaccumulation of methylmercury in fish and seal populations targeted by Labrador Inuit.

The Agreement defines “consult” as requiring notice, a reasonable period of time for the party being consulted to prepare, an opportunity to present its views on the matter, and full and fair consideration of those views. There were also additional consultation obligations on the Crown for this project as it was reasonably expected to have adverse environmental effects on Inuit rights under the Agreement. Consequently, the Crown was further required to ensure that Nunatsiavut was consulted about the environmental effects and the best way to achieve meaningful participation for Inuit in the environmental assessment, and that Nunatsiavut received a report generated as a result of the environmental assessment that included the rationale, conclusions and recommendations of the JRP.

In advance of the JRP process proceeding, Canada issued an Aboriginal consultation framework for the project that detailed how it planned to rely on the JRP process, to the extent possible, to assist in fulfilling its duty to consult Aboriginal peoples such as the Labrador Inuit with respect to the project. Among other things, this framework identified that the Canadian Environmental Assessment Agency (the “Agency”) would be responsible for coordinating federal Aboriginal consultation during the assessment. When the Agency subsequently met with Nunatsiavut to discuss this framework, Nunatsiavut’s response was that the framework was fine as it was fairly generic and contained nothing unexpected. The only two concerns expressed by Nunatsiavut were with respect to the number of days it would be allotted to prepare for hearings and the scope of the area covered by the project’s description.

Under Canada's Aboriginal consultation framework, consultation on the project was to be broken up into five distinct phases in the course of the project's environmental assessment. First, initial engagement and consultation would be conducted on the draft JRP agreement, the appointment of JRP members and the Environmental Impact Study Guidelines. Second, consultation would occur in the pre-hearing stage of the JRP process. Third, consultation would occur through the hearings and preparation of the JRP’s environmental assessment report. Fourth, consultation would occur between the Crown and Nunatsiavut with respect to the JRP’s report. Fifth, final consultations would occur with respect to the regulatory permitting required for the project, such as the Fisheries Act authorization central to this judicial review.

Nunatsiavut challenged the adequacy of the Crown’s consultation and accommodation of its concerns over the course of this five stage process, particularly with respect to uncertainty surrounding the downstream mercury contamination that the project might entail.

Court’s decision:

Standard of review

The Court set out a detailed analysis of past jurisprudence on the appropriate standard of review for duty to consult cases. The Court held that “the Crown must correctly identify the legal parameters of the content of the duty to consult in order to properly identify what will comprise adequate consultation”. This will require identifying all applicable legal and constitutional limits, including specific treaty rights, legislative rights, common law rights and applicable administrative and constitutional law. However, if the Crown has correctly identified these parameters, then the adequacy of the subsequent process of consultation it employed will be reviewed on a standard of reasonableness.

Whether Agreement's consultation obligations are exhaustive

With respect to whether the Agreement exhaustively defined the Crown’s duty to consult, the Court engaged in an analysis of the Supreme Court of Canada’s 2010 decision in Beckman v. Little Salmon/Carmacks First Nation. In the Court’s view, Little Salmon stands for the proposition that “when a modern day land claim treaty is in place, the starting point for any analysis of the duty to consult will always be the text of the agreement” and if the treaty’s terms address the duty to consult in the applicable situation then “the scope of that duty will primarily, if not exclusively, be shaped by those terms”. However, a duty to consult will still arise where the modern treaty is silent on the duty to consult in the applicable situation or there is a procedural gap. Furthermore, the Court held that where the terms of a modern treaty address the duty to consult, “the honour of the Crown and adjunct duty to consult may be used as interpretive tools”.

The Court went on to note that since the rights in this case were established by the Agreement there was no need to conduct a strength of claim analysis, as is required in the case of asserted but unproven rights. Nevertheless, the Court was still obliged to assess the Project’s potential impact on the Labrador Inuit’s rights under the Agreement.

Scope of the duty to consult

The primary concerns of Nunatsiavut related to “the downstream effects of methylmercury bioaccumulation on its established subsistence rights”. In terms of the relevant findings of the JRP with respect to these effects, the Court noted that the JRP was unable to confidently conclude what the ecological effects would be downstream from Muskrat Falls and acknowledged there was a risk of downstream mercury bioaccumulation in fish and seals. As a result, the JRP recommended that DFO require Nalcor to carry out a comprehensive assessment of downstream effects. The JRP also noted that there was the potential for the Project to displace or reduce traditional harvesting activities by impacting the acceptability and desirability of locations downstream of Muskrat Falls for harvesting fish and seals. Furthermore, it recognized that methylmercury production was an inevitable result of reservoir impoundment; consumption of fish or country food contaminated by methylmercury could pose risks to human health, particularly for young children; fish and country food are an important part of the diets of Labrador and Quebec’s Aboriginal peoples for both health and economic reasons; and there is no biophysical mitigation possible for this effect. 

Based in part on the JRP’s findings with respect to methylmercury bioaccumulation, the Court held that in this case the content of the duty to consult fell “between the medium and high end of the spectrum”. The Court found that if mercury levels rise beyond predicted levels it would be a significant adverse impact but the risk of this occurring remained uncertain. Likewise, mercury levels were predicted to peak 5 to 16 years after flooding and then gradually decrease to background levels over the following decades therefore the impacts would not be permanent or irreversible.

The Agreement sets out precise requirements for consultation in these circumstances, requiring the Crown to give Nunatsiavut notice, time to prepare its views and an opportunity to present them, and a full and fair consideration of these views, as well as additional requirements triggered when an “undertaking” is subject to an environmental assessment and may reasonably be expected to have adverse effects on Inuit rights under the Agreement. The Court held that these additional requirements required consultation to at least fall at the mid-range of the consultation spectrum. The Court also contrasted the required consultation in this case with the higher level of consultation that would have been necessary under the Agreement had the project being proposed on lands designated as “Labrador Inuit Lands” under the Agreement, in which case Nunatsiavut’s consent to the project would have been necessary. The Court found that in this case the duty to consult would require responsiveness on the part of the Crown and the Crown would need to demonstrate that Nunatsiavut’s views were taken into consideration, among other things. The Court also expressed the view that there may also be a requirement to accommodate Nunatsiavut, to the extent possible, by taking steps to avoid or mitigate significant adverse effects or irreparable harm.

Collateral attack

Nunatsiavut argued that the DFO authorization it was challenging in this application was predicated on Canada's earlier decisions to allow the project to proceed and any failure to adequately consult in respect of those earlier decisions tainted or compromised Canada's ability to issue the authorization at issue. In response, Nalcor argued that this constituted a collateral attack on those earlier decisions. Nalcor argued that the time period for challenging those decisions under the Federal Courts Act had lapsed, that the authorization was a separate decision from the project’s overall approval that related to specific activities and conditions upon them, and that Nunatsiavut had improperly framed and pleaded any challenge to those earlier decisions.

The Court expressed the view that it was significant that while the environmental assessment process concluded with the issuance of the JRP’s report, the consultation process did not. The Court also noted two other legal challenges to the project that were found to be premature or to have failed to recognize that the consultation process did not conclude with Canada’s approval of the project. The Court found that the five phases of the consultation process, and the consultation undertaken in each phase, were connected and, to some extent, cumulative.

The Court acknowledged that Nunatsiavut’s judicial review application only challenged DFO’s authorization and it was not open for Nunatsiavut to collaterally attack the validity of Canada’s earlier approval of the project through this application. However, the Court found that Nunatsiavut was entitled to look to the prior consultation record for the purpose of questioning the content or adequacy of the consultation with respect to the issuance of DFO’s authorization so long as it did not attempt to impugn the validity of those prior decisions.

Delegation of consultation obligations

Nunatsiavut challenged the Crown’s ability to satisfy its consultation obligations under the Agreement through the JRP process on the basis that these obligations could not be delegated. However, the Court found that the jurisprudence on the Crown’s duty to consult confirmed that this duty could be satisfied through consultation within an environmental assessment process. Furthermore, participation in the federal environmental assessment process was explicitly contemplated by the terms of the Agreement so in this case the Court found there was no question that the environmental process was intended to comprise part of the required consultation.

The Court went on to find that the Crown had adequately consulted and accommodated Nunatsiavut in accordance with the terms of the Agreement.

Adequacy of consultation

In terms of the JRP hearing phase of consultation, the Court found that Nunatsiavut was fully engaged in the process and the JRP was mandated to and did set out in the JRP report information that was provided by Aboriginal groups, including Nunatsiavut, concerning the rights and “traditional uses” that could be impacted by the project’s potential environmental effects. The Court found that the issue of potential methylmercury bioaccumulation was “at the forefront of the JRP’s considerations” and formed the basis of many of its recommendations. The Court also noted that Nunatsiavut had conceded during the hearing that it did not take issue with the adequacy of the consultation afforded to it by the JRP during this phase of consultation.

Nunatsiavut challenged the internal Aboriginal Consultation Report that was prepared by the Agency on the basis that this report misrepresented Nunatsiavut’s position as being “generally supportive of the [p]roject”. Nunatsiavut argued that this was contrary to the honour of the Crown and indicative of a lack of meaningful consultation. Witnesses for the Crown, on the other hand, testified that this statement was based on the fact that Nunatsiavut had provided recommendations to the JRP on how its concerns could be remedied rather than outright rejecting the project in any form. The Court found that little turned on this issue. The report clearly communicated Nunatsiavut’s concerns and the mitigation steps it had proposed. The Court also found that the report reasonably reflected Nunatsiavut’s comments on the project at the time it was authored.

Nunatsiavut argued that the Crown ought to have first made a preliminary decision on the project and then, if it planned to allow the project to proceed, notified Nunatsiavut, provided Nunatsiavut with sufficient information about the proposed decision to allow it to formulate its views and sufficient time to prepare a response that would be fully and fairly considered. The Court found that this procedure went beyond what was specified in the Agreement and had no basis in the consultation framework to which Nunatsiavut had largely agreed. Nunatsiavut also could have raised its concerns in this regard when commenting on the draft protocol for phasing of the project but it failed to do so.

The Court also held that the Crown had adequately consulted and accommodated Nunatsiavut with respect to the authorization issued under the Fisheries Act, which was, in its view, “[t]he real issue in this judicial review”.

The Court stated that DFO’s communications with Nunatsiavut together with the protocol for phasing the project had served to satisfy the consultation requirements under the Agreement, and would have been equally satisfactory had the common law duty to consult been applied rather than the specific requirements of the Agreement. The Court found that the Crown’s duty to consult was satisfied in this case as DFO gave Nunatsiavut notice that it was preparing to issue an authorization under the Fisheries Act; provided Nunatsiavut with a draft environmental effects monitoring plan for comment; met with Nunatsiavut to discuss its concerns regarding this plan; received Nunatsiavut’s concerns in writing and responded to these in writing; and accommodated Nunatsiavut by requiring the proponent to additional details to the protocols for sampling and analysis of fish and seals in the plan.

Necessity and adequacy of accommodation

With respect to whether the Crown owed Nunatsiavut a duty to accommodate, the Court found the Agreement to be “silent as to accommodation”. However, the Court noted that the potential consequences of Crown action were serious and the Agreement contemplated both the JRP process and further consultation with respect to permitting. The Court held that common law principles of the duty to consult and accommodate could be used to interpret “what, if any accommodation [was] required in these circumstances”. The Court found that Canada was obliged to consider, take into account and respond to the issue raised by Nunatsiavut, accommodating Nunatsiavut, “where and to the extent possible, by taking appropriate steps to avoid or mitigate significant adverse effects or irreparable harm”. –

One of Nunatsiavut’s concerns was that Canada had failed to adopt one of the JRP’s recommendations that suggested measures to better predict the levels of mercury in the project’s downstream environment. The Court found that Nunatsiavut had failed to provide any authority suggesting that Canada was required to accept recommendations made by the JRP as part of the environmental assessment process. However, the Court stated that, in its view, Canada could not simply ignore or reject the JRP’s recommendations without reasons, as doing so would entirely undermine the environmental assessment process and its use by Canada to fulfill its consultation obligations. However, the Court found that the recommendation at issue was not ignored or rejected in whole; rather, the recommendation’s intent was accepted to the extent that the uncertainty identified by the JRP was acknowledged and addressed, even if this was not done in the manner recommended by the JRP. While the Court found little doubt that Canada could have provided a more in-depth explanation as to why it accepted the intent of the JRP’s recommendation but did not adopt the recommendation in whole, it was satisfied that Canada’s rationale was apparent from the record in this case.

The Court rejected various other contentions raised by Nunatsiavut as to whether it had been adequately accommodated such as the rejection of Nunatsiavut’s requests for Inuit participation in a high level management structure, funding for a study to be carried out by a particular contractor and language regarding compensation should impacts arise. The Court also rejected Nunatsiavut’s concerns over Canada’s failure to require full clearing of the reservoir’s trees and top layer of organic matter, noting that there was an unchallenged jurisdictional finding that the clearing of trees was up to the Province to address and soil removal as a mitigation measure was experimental in nature. While Nunatsiavut might have expected Canada to explicitly address this issue in its response to the JRP’s report in any event, since methylmercury levels were a major concern for Nunatsiavut and a central issue for the JRP, the Court still found that Canada’s decision to not accommodate Nunatsiavut in this regard was informed and reasonable.

In concluding, the Court noted that the proponent’s predictions were that mercury bioaccumulation in fish and seals would not rise to levels that would require consumption advisories and thereby impact Labrador Inuit's harvesting rights, but if these predictions were wrong, little could be done to reduce these mercury levels. In the Court’s view, such potential circumstances would mean that further consultation and accommodation of Nunatsiavut would be required by the honour of the Crown and Canada could well be required to accommodate Nunatsiavut through financial redress or other appropriate measures.

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