Environmental Appeal Board

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1 Environmental Appeal Board Fourth Floor 747 Fort Street Victoria British Columbia Telephone: (250) Facsimile: (250) Mailing Address: PO Box 9425 Stn Prov Govt Victoria BC V8W 9V1 DECISION NO WAT-013(a) In the matter of an appeal under section 92 of the Water Act, R.S.B.C. 1996, c BETWEEN: Chief Kathi Dickie in her own right and on behalf of the members of the Fort Nelson First Nation APPELLANT AND: Assistant Regional Water Manager RESPONDENT AND: Nexen Inc. THIRD PARTY AND: BEFORE: DATE: LOCATION: EOG Resources Canada Inc. Devon Canada Corporation A Panel of the Environmental Appeal Board Alan Andison, Chair Conducted by way of written submissions with closing oral submissions on September 24, 2012 Victoria, BC PARTICIPANTS APPEARING: For the Appellant: For the Respondent: For the Third Party: Nexen Inc. For the Participants: EOG Resources Devon Canada James Tate and Nathan Hume, Counsel Livia Meret and Joel Oliphant, Counsel Shannon Young, Counsel Lorne Rollheiser, Counsel Chandra Mazuryk, Counsel PRELIMINARY ISSUE OF STANDING [1] On June 11, 2012, Chief Kathi Dickie, in her own right and on behalf of the members of the Fort Nelson First Nation (the First Nation ), appealed a decision to issue Conditional Water Licence C (the Licence ) to Nexen Inc. ( Nexen ). The Licence was issued pursuant to section 12(1) of the Water Act by Robert M. Piccini, Assistant Regional Water Manager (the Manager ), Ministry of Forests, Lands and Natural Resource Operations (the Ministry ). The Licence authorizes Nexen to divert water from North Tsea Lake for storage in dugouts and use in oilfield injection.

2 DECISION NO WAT-013(a) Page 2 [2] The First Nation is an adherent to Treaty 8, and exercises treaty rights in the vicinity of North Tsea Lake. The First Nation appealed on the grounds that the Manager failed to adequately consider and assess certain effects of the Licence, and failed to conduct meaningful consultation with the First Nation before issuing the Licence. [3] On July 12, 2012, the Manager challenged the First Nation s standing to appeal the Licence under section 92 of the Water Act. The Manager submits that the appeal should be dismissed due to the First Nation s lack of standing. [4] The First Nation submits that it has standing to appeal the Licence under section 92 of the Water Act. [5] This preliminary decision addresses the issue of whether the First Nation has standing to appeal the Licence under section 92 of the Water Act. BACKGROUND The Tsea River watershed and Treaty 8 [6] The Tsea River watershed is located northeast of Fort Nelson, B.C. The watershed is in an area known, for oil and gas development purposes, as the Horn River Basin. [7] The Tsea River flows in a northeasterly direction before it converges with the Petitiot River. North Tsea Lake flows into the Tsea River. Middle Tsea Lake and South Tsea Lake are also located in the Tsea River watershed. [8] The Tsea River watershed is part of the area covered by Treaty 8, which encompasses much of northeastern B.C., northern Alberta, northwestern Saskatchewan, and the southern portion of the Northwest Territories. Treaty 8 was made between negotiators for the Government of Canada and representatives of various aboriginal peoples in The First Nation s ancestors adhered to Treaty 8 in Neither the Tsea River nor North Tsea Lake are located on or adjacent to any of the First Nation s Reserve lands, but the First Nation submits that the Tsea River watershed is within the core of its traditional territory, and that the First Nation s members exercise treaty rights in and around North Tsea Lake. The treaty rights of aboriginal peoples in Canada are recognized and affirmed under section 35(1) of the Constitution Act, The Licence [9] On April 6, 2009, Nexen applied for a conditional water licence to withdraw water from North Tsea Lake. Nexen proposed to pipe water from North Tsea Lake to a borrow pit for storage and use in the oilfield injection process, also known as hydraulic fracturing or fracking. Nexen proposed a real-time adaptive management program, whereby it would withdraw and store the water during times of greater stream flow, and cease withdrawals from North Tsea Lake when the stream flow falls below a particular threshold.

3 DECISION NO WAT-013(a) Page 3 [10] On June 2, 2009, the Ministry sent a referral package, including Nexen s application, to the First Nation for review. Over the next three years, various telephone conversations, exchanges of correspondence, and meetings occurred between representatives of the Ministry, the First Nation, and Nexen. Some, but not all, of that communication is summarized below. [11] Meanwhile, in October 2011, the Oil and Gas Commission issued a short-term (one year) water use approval under section 8 of the Water Act to Nexen, authorizing the diversion of up to 13,140 cubic meters of water per day from North Tsea Lake for storage and oilfield injection purposes, to a maximum of 1,400,000 cubic meters per year. [12] On January 27, 2012, a Water Stewardship Officer with the Ministry sent a letter to the First Nation providing further information about Nexen s licence application, and advising that the Ministry had conducted a preliminary review of technical factors and other information, including a Treaty 8 traditional use study. The letter states, in part: From this review, Water Stewardship is aware that FNFN [Fort Nelson First Nation] exercises Treaty 8 rights in and around the Tsea Lakes and the potential for archeological sites in the Tsea Lakes area is high, although not specifically identified. Technical representatives from Water Stewardship are available to continue to work with FNFN for the purpose of addressing any concerns. The Province has taken into consideration the above noted preliminary assessment and believes that the proposed water license application does not appear to have an appreciable adverse effect on FNFN s ability to continue to exercise their Treaty 8 rights in and around the Tsea Lakes area. We would welcome further input that FNFN may have on the preliminary conclusions made above. [13] The letter requested that the First Nation respond within 30 days of receipt of the letter. [14] By a letter dated April 3, 2012, a Water Stewardship Officer with the Ministry advised the First Nation that the Ministry was proceeding to make a decision on Nexen s application. The letter states, in part: The Fort Nelson First Nation has raised concerns regarding impacts to fish and navigation on lakes and rivers. Having received no further information from Fort Nelson First Nation it remains my assessment that there would be no impact to Fort Nelson First Nation rights recognized and affirmed by section 35(1) of the Constitution Act, 1982 given the requested withdrawal of water from North Tsea Lake in relation to the total flow within the Tsea River watershed and given [that] appropriate screened intakes will be installed. Seasonal fluctuations in flow and fluctuations in the water withdraw[al] amount were considered in reaching this conclusion.

4 DECISION NO WAT-013(a) Page 4 [15] The Board understands that in a letter dated April 4, 2012, the First Nation requested a consultation meeting with Ministry staff. The April 4, 2012 letter has not been provided to the Board, but it is referred to in other correspondence that is before the Board. [16] In a letter dated April 11, 2012, the Manager acknowledged the First Nation s request, but advised that sufficient opportunity has been provided to the Fort Nelson First Nation for further engagement on this application and no response has been received. [17] By a letter dated April 13, 2012, the First Nation s Chief responded to the Manager s April 11, 2012 letter, and stated, in part: You have stated in previous correspondence that your alleged consultation process on the Nexen/North Tsea Lake application began as early as As you are aware, we dispute that there has been any real consultation with us, beyond sending us letters which appear to have reached a foregone conclusion. However, now you indicate that accommodating FNFN s meeting schedule by a couple of weeks will cause unreasonable delay to the proponents. Your rush to make a decision follows a long period where the Province has failed to sit down with us on a timely basis to ascertain the scope of our treaty rights and to talk with us about how impacts to our water systems will be managed going forward. In any event, it is the Crown s constitutional obligation to meaningfully consult with us, and that means actually sitting down with us to discuss the concerns we have raised. [18] On May 11, 2012, the Manager issued the Licence. The Licence was issued for industrial (oilfield injection) and storage (non-power) purposes, and authorizes Nexen to divert water from the North Tsea Lake into storage dugouts from April 1 to October 31, and to use the stored water for oilfield injection the whole year. The Licence states that it is appurtenant to Oil & Gas activities within that parcel or tract of unsurveyed Crown land held under the Petroleum and Natural Gas Lease system [followed by a list of 24 lease numbers]. [19] The Licence authorizes a maximum of 60,000 cubic meters of water per day to be diverted for oilfield injection, to a maximum total of 2,500,000 cubic meters per year. The maximum quantity that may be held in storage is 2,500,000 cubic meters. The Licence also specifies that daily withdrawal limits will be as per the flow-weighted extraction method as outlined in the document named Water Development & Management Plan Tsea River Watershed dated March 2011 provided by Nexen. In addition, withdrawals must cease when water discharges from North Tsea Lake to the Tsea River fall below cubic meters per second. [20] Also of note, the Licence is for a five-year term, expiring on December 31, The authorized works are a screened intake, pump, pipe, flow meter device and dugouts. The authorized works were constructed under the previous shortterm water use approval, and are currently in use.

5 DECISION NO WAT-013(a) Page 5 [21] On May 11, 2012, the Manager also sent a letter to the First Nation advising that the Licence had been issued. Attached to that letter was a copy of the Licence and the rationale for the Manager s decision. [22] On June 7, 2012, at Nexen s request, the Oil and Gas Commission cancelled Nexen s short-term water use approval, which would have expired in October The Appeal [23] The First Nation appeals on two main grounds: (1) inadequate consideration and assessment of certain impacts of the Licence; and (2) failure to uphold the honour of the Crown through meaningful consultation with the First Nation before the Licence was issued. In its Notice of Appeal, the First Nation did not describe the basis for its standing to appeal the Licence. It simply stated that the First Nation is a Treaty 8 First Nation and that the Tsea Watershed, including the three Tsea Lakes (North, South and Middle) and the Tsea River, are in the core of its territory. The First Nation stated that the Tsea River Watershed and proximate area is an area of intensive traditional and current use for FNFN, including such high value subsistence uses as hunting, habitation, trapping, and fishing. It states that the area contains important transportation corridors for the First Nation, and is an area of high cultural and spiritual significance. It also states that the amount of water authorized for withdrawal under the Licence represents a serious infringement of FNFN s Treaty Rights. [24] In its Notice of Appeal, the First Nation requested a stay of the Licence pending the Board s decision on the merits of the appeal. Subsequently, the Board set a schedule for submissions on the stay. [25] Shortly thereafter, the Manager provided notice that it may be challenging the First Nation s standing to appeal. Its formal challenge was made at the same time as its submissions on the stay. [26] The Board suspended the stay submissions pending a decision on the First Nation s standing. The Application Challenging the Appellant s Standing to Appeal [27] The Manager submits that, to have standing to appeal, the First Nation must come within section 92(1) of the Water Act, which states: 92 (1) Subject to subsections (2) and (3), an order of the comptroller, the regional water manager or an engineer may be appealed to the appeal board by (a) the person who is subject to the order, (b) an owner whose land is or is likely to be physically affected by the order, or

6 DECISION NO WAT-013(a) Page 6 (c) a licensee, riparian owner or applicant for a licence who considers that their rights are or will be prejudiced by the order. [28] In summary, section 92(1) of the Water Act only allows an appeal to be filed by the person who is subject to the order (e.g., the Licensee), an owner whose land is or is likely to be physically affected by the order, or a licensee, riparian owner or applicant for a licence who considers that their rights are or will be prejudiced by the order. [29] The Manager maintains that the First Nation meets none of those categories, because the First Nation: is neither a licensee nor an applicant for a water licence in relation to the Tsea River or North Tsea Lake, is not a riparian owner on Tsea River or North Tsea Lake, and is not an owner whose land is or is likely to be physically affected by the decision under appeal. [30] The First Nation submits that it has standing to appeal as both an owner whose land is or is likely to be physically affected by the Licence under subsection 92(1)(b), and a riparian owner under section 92(1)(c) of the Water Act. [31] The Licensee, Nexen, was given Third Party status in the appeal. It defers to the Manager s submissions respecting the First Nation s standing to appeal. [32] As Devon Canada Corporation has a water licence on the Tsea River, it was offered, and accepted, participant status in the appeal. It provided no submissions on the issue of standing. [33] EOG Resources Canada Inc. has a short-term water use approval in the Tsea River watershed. It was offered, and accepted, limited participant status to monitor the proceedings. By a letter dated July 16, 2012, it advised that it would not be making submissions on the standing application. [34] It should be noted that none of the parties dispute that the Board has jurisdiction under section 94(2) of the Environmental Management Act to hear submissions as to facts, law and jurisdiction, and as such, has jurisdiction to decide questions of aboriginal rights and title in the course of deciding appeals that come before the Board: Paul v. British Columbia (Forest Appeals Commission), [2003] 2 S.C.R. 585; Okanagan Indian Band v. Deputy Comptroller of Water Rights, Appeal No. 91/16(b), issued August 25, 1998.

7 DECISION NO WAT-013(a) Page 7 ISSUE [35] Whether the First Nation has standing to appeal the Licence as: 1. an owner whose land is or is likely to be physically affected by the Licence under section 92(1)(b) of the Water Act; and/or 2. a riparian owner who considers that their rights are or will be prejudiced by the Licence under section 92(1)(c) of the Water Act. DISCUSSION & ANALYSIS 1. Whether the First Nation is an owner whose land is or is likely to be physically affected by the Licence under section 92(1)(b) of the Water Act. The Manager s submissions [36] The Manager notes that the Board is constituted under the Environmental Management Act and has jurisdiction to hear appeals under other legislation, including the Water Act. The Manager submits that, to have standing to appeal, the First Nation must come within section 92 of the Water Act, which identifies categories of persons who may appeal to the Board. As the First Nation is not a water licensee, nor an applicant for a water licence, in relation to the Tsea River or North Tsea Lake, the Manager did not address those categories. [37] The Manager submits that, in previous appeals to the Board where the question of a First Nation s standing to appeal arose, those First Nations had standing as either a water licensee, water licence applicant, riparian landowner or an owner whose land would be physically affected by licensed works. The Manager submits that in this case, unlike in previous cases, the First Nation does not have standing to appeal. [38] With respect to whether the First Nation is an owner whose land is or is likely to be physically affected by the Licence, the Manager refers to the Water Act definitions of owner, mine and undertaking. In particular, the definition of owner states as follows: owner means a person entitled to possession of any land, mine or undertaking in British Columbia, and includes a person who has a substantial interest in the land, mine or undertaking; [underlining added] [39] The Manager submits that those definitions confine the question of whether the First Nation is an owner whose land is or is likely to be physically affected to whether the First Nation is entitled to possession of any land or has a substantial interest in the land.

8 DECISION NO WAT-013(a) Page 8 [40] The Manager maintains that, given the surrender of rights under Treaty 8, the Appellant is not entitled to possession of land in respect of the lands subject to the Treaty. The First Nation s rights in relation to the tract surrendered are set out in Treaty 8, which states:... the said Indians DO HEREBY CEDE, RELEASE, SURRENDER AND YIELD UP to the Government of the Dominion of Canada, for Her Majesty the Queen and Her successors forever, all their rights, titles and privileges whatsoever, to the lands included within the following limits... [a description of the tract surrendered then follows] [41] The Manager submits that, while aboriginal treaties constitute a unique type of agreement and attract special principles of interpretation, the Supreme Court of Canada has been consistent in its view that the Treaty is a surrender and extinguishment of all aboriginal rights to the lands: R. v. Badger, [1996] 1 S.C.R. 771 [Badger], at paras. 22 and 41; R. v. Marshall, [1999] 3 S.C.R. 456 [Marshall], at para. 78. Most recently, in Mikisew Cree First Nation v. Canada (Minister of Canadian Heritage), [2005] 3 S.C.R. 388 [Mikisew], at para. 31, in interpreting the Crown's duty to consult in relation to Treaty 8 rights, Justice Binnie noted... the aboriginal rights have been surrendered and extinguished, and the Treaty 8 rights are expressly limited to lands not required or taken up from time to time for settlement, mining, lumbering, trading or other purposes. [underlining in original] [42] Further, the Manager submits that, in exchange for the surrender of all rights, titles and privileges whatsoever to the lands, the Crown made a number of commitments, including the grant of treaty hunting, trapping and fishing rights, set out in the treaty in the following terms:... And Her Majesty the Queen HEREBY AGREES with the said Indians that they shall have right to pursue their usual vocations of hunting, trapping and fishing throughout the tract surrendered as heretofore described, subject to such regulations as may from time to time be made by the Government of the country, acting under the authority of Her Majesty, and saving and excepting such tracts as may be required or taken up from time to time for settlement, mining, lumbering, trading or other purposes. [43] The Manager argues that the First Nation s treaty rights do not constitute an entitlement to possession of the land. Rather, they are rights of nonexclusive access and use in relation to the land for the purposes of pursuing the activities of hunting, trapping and fishing, subject to the limitations set out in the treaty. They are collective rights that are inalienable, save through surrender to the Crown. As with all rights, they are not absolute: R. v Nikal, [1996] 1 S.C.R. 1013, at para. 92. Also, the First Nation s treaty rights do not give it a veto over disposition of the land or changes in its use: Mikisew, at para. 66. [44] In addition, the Manager submits that treaty rights do not amount to a possessory or proprietary interest in land: Claxton v. Saanichton Marina Ltd.,

9 DECISION NO WAT-013(a) Page 9 [1989] 3 C.N.L.R. 46, (B.C.C.A.), [Claxton], at para. 34. In dealing with a Douglas Treaty right to fish as formerly in the Claxton case, the Court of Appeal recognized that the right granted to the Indians by treaty is unique in the sense that it is difficult to describe it within the framework of traditional legal terminology, but the Court concluded that the treaty right in that case did not amount to a proprietary interest in the land. [45] The Manager further submits that, in R. v. Sundown, [1993] 1 S.C.R. 393 [Sundown], the Supreme Court of Canada held that treaty rights, like aboriginal rights, must not be interpreted as if they were common law property rights. In that case, an interest in a hunting cabin built in a park was considered to be a collective right derived from Treaty 6 and the traditional expeditionary method of hunting, but not a proprietary interest in the park itself. Also, in R. v Sparrow, [1990] 1 S.C.R. 1075, at para. 68, the Supreme Court of Canada stated that fishing rights are not traditional property rights. They are rights held by a collective and are in keeping with the culture and existence of that group.... [46] The Manager also provided submissions on the meaning of possession. The Manager argues that, at common law, the concept of possession has been held to entail exclusionary control and occupancy: Black s Law Dictionary, 4th ed., at p. 1229; and Oxford Companion to Law, at p [47] In support of those submissions, the Manager referred to the Board s decisions in: Columbia Power Corporation v. British Columbia (Ministry of Water, Land and Air Protection), [2003] B.C.E.A. No. 11 (Q.L.), 2003-WAT-003(a) [Columbia Power]; Fugger v. British Columbia (Ministry of Environment, Lands and Parks), [2001] B.C.E.A. No. 22 (Q.L.), 2000-WAT-005, at paras [48] The Manager submits that the argument that Treaty 8 rights are not possessory is even stronger because, unlike the Douglas Treaty right to fish referred to in Claxton, Treaty 8 rights are subject to the express geographical limitation of the Crown s right to take up land so that those rights can no longer be exercised on lands put to a visibly incompatible use (Badger, at para. 57). In that regard, the Supreme Court of Canada held in Badger, at paras , that, as confirmed by their oral history, the Indians understood that land would be taken up for homesteads, farming, prospecting and mining and that they would not be able to hunt in these areas or to shoot at settlers farm animals or buildings. [49] With respect to whether the First Nation qualifies to appeal by virtue of being a person who has a substantial interest in the land whose land is or is likely to be physically affected, the Manager maintains that the First Nation is not a person who has a substantial interest in the lands surrendered under the Treaty. The Manager emphasizes that, under the express terms of the Treaty, all aboriginal interests in the land ( rights, title and privileges whatsoever ) were released and surrendered. [50] In addition, the Manager submits that, when Treaty 8 was signed, the signatory First Nations main concern was to protect their traditional hunting, trapping and fishing practices in the continuing pursuit of their traditional way of life

10 DECISION NO WAT-013(a) Page 10 and means of livelihood. In West Moberly First Nations v. British Columbia (Ministry of Energy, Mines and Petroleum Resources), [2011] B.C.J. No. 942 [West Moberly], at paras. 128, 130 and 137, the majority of the B.C. Court of Appeal found that the Treaty 8 right to hunt is not to be interpreted as merely a right to hunt for food. However, the Court did not suggest that the traditional practices recognized as treaty rights constitute an interest in land. In interpreting Treaty 8, the majority highlighted the relevance of the Commissioner s assurances that the First Nations would be free to continue with the same means of earning a livelihood as existed pre-treaty, and that the Treaty would not lead to forced interference with their mode of life. [51] Finally, the Manager submits that there is no evidence that land is or is likely to be physically affected in this case, such as by the licensed works that are already in place. The Manager notes that the Licence requires a flow-weighted withdrawal program, utilizing real-time stream discharge monitoring and a zero withdrawal threshold, to provide sufficient flow for environmental values. The Manager submits that no impacts to fish, wildlife or riparian areas are anticipated, although ecological monitoring is required. In support of those submissions, the Manager refers to a report dated December 20, 2011, prepared by Sean K. Carey, Associate Professor of Hydrology at McMaster University, titled External Review of the Tsea River Water Development and Management Plan. Dr. Carey s report was submitted to Nexen, the First Nation, and the Manager before the Licence was issued. The Manager advises that Dr. Carey was selected, with the agreement of both Nexen and the First Nation, to conduct an independent review of Nexen s Water Development and Management Plan. The First Nation s submissions [52] The First Nation submits that the right to appeal to the Board extends to persons with substantial legal interests that may be affected by decisions under the Water Act. The First Nation argues that owner is defined in the Water Act to include a person who has a substantial interest in the land, and the First Nation has a substantial interest in the land by virtue of its constitutionally protected treaty rights to hunt, fish and trap throughout its traditional territory. The First Nation submits that those rights are not simply rights to conduct certain activities, but are rights to practice a historic mode of life based on traditional patterns of activity and occupation : West Moberly, at paras. 130, 137. The First Nation maintains that its treaty rights are inseparable from the land, and necessarily include occupation of and meaningful access to the lands, waters and resources on which their traditional mode of life depends, including the Tsea Watershed. [53] In addition, the First Nation submits that treaty rights to hunt, fish and trap include activities that are reasonably incidental to hunting, fishing and trapping; that is, activities that are essential, integral or meaningfully related to the exercise of the treaty right. Such activities include travelling to hunting grounds, fishing spots or traplines, and in some circumstances, constructing and occupying cabins from which to carry out those activities: Simon v. The Queen, [1985] 2 S.C.R. 387, at para. 31; Sundown at paras. 30 and 33.

11 DECISION NO WAT-013(a) Page 11 [54] Furthermore, the First Nation submits that it falls within the definition of owner because it is entitled to possession of the lands in the Tsea Watershed, in that it is entitled to occupy and maintain a physical presence in the Tsea Watershed based on its treaty rights to hunt, fish and trap throughout the area. In particular, the First Nation submits that its members conduct hunting, fishing and trapping in the vicinity of North Tsea Lake, and also use the area for habitation and transportation. In support of those submissions, the First Nation provided a map titled Tsea Lake Use Values and a letter dated June 26, 2012, written by the First Nation s Director of Lands and Resources. The letter refers to the map, and indicates that the Tsea Lakes area is important habitat for certain wildlife including moose, and is used by the First Nation s members for traditional purposes such as trapping, habitation, harvesting, wood gathering, and transportation to hunting, fishing and trapping grounds. [55] Turning to the Water Act, the First Nation submits that the Act s purpose is to protect the public interest in provincial water resources, by establishing a licensing scheme that regulates competing rights and interests: R. v. Golden Eagle Ranch Inc., 2003 BCPC 206 [Golden Eagle Ranch], at para. 4. The First Nation also submits that the appeal process is an integral part of the legislative scheme, and the Board has jurisdiction to decide issues of aboriginal rights and title. Further, the First Nation submits that, if the Board has no jurisdiction in this case, aboriginal peoples would be denied the benefits of the Board s specialized expertise. Specifically, if section 92(1) of the Water Act were interpreted in such a way that the Board has jurisdiction to decide issues of aboriginal rights and title, but the people who hold those rights and title cannot rely on them for standing before the Board, the result would be a bifurcated system that forced aboriginal people to turn to the courts, instead of the Board, in matters that the Board is uniquely qualified to consider. [56] The First Nation submits that, under section 92(1) of the Water Act, the Legislature delineated a right of appeal for persons with substantial legal interests, and chose to exclude persons who lack legally enforceable rights, in order to balance accessibility with efficiency: B.C. Legislative Assembly, Debates of the Legislative Assembly (Hansard), 36 th Parl., 2 nd Session, Vol. 5, No. 11 (28 May 1997), at p Treaty rights are legally enforceable and constitutionally protected, and are not frivolous concerns of the sort the Legislature sought to exclude under section 92(1) of the Water Act. In addition, the First Nation submits that it would be inconsistent with the principles of natural justice to exclude treaty rights from a scheme that is intended to produce a consistent system of appeals for all environmental legislation : Hansard, 36 th Parl., 2 nd Session, Vol. 5, No. 2 (15 May 1997), at p [57] The First Nation distinguished the Board s previous decision in Allied Tsimshian Tribes Association v. Deputy Comptroller of Water Rights, Appeal No. 95/06, issued October 11, 1995 [Allied Tsimshian], on both the facts and subsequent changes to the appeal provisions and case law on aboriginal rights and title. In that case, the Board held that asserted aboriginal rights were insufficient for standing to appeal a decision under the Water Act. However, the First Nation

12 DECISION NO WAT-013(a) Page 12 notes that the appeal provisions at that time resembled the present section 92(1)(c), and were limited to a licensee, riparian owner or an applicant for a licence. The appeal provisions were subsequently amended by adding the present sections 92(1)(a) and (b). The First Nation argues that those amendments expanded the standing provisions to serve the objectives identified by the Legislature: accessibility, efficiency, natural justice and environmental sustainability. Moreover, in Allied Tsimshian, the appellant introduced no evidence of its aboriginal rights, whereas in this case, the First Nation s treaty rights have been acknowledged by the Ministry and there is evidence that the First Nation s members use the Tsea River watershed. [58] With regard to the meaning of owner in the Water Act, the First Nation submits that the ordinary meaning of owner is fluid and contextual, and is not limited to persons who hold land in fee simple. In any case, owner in the Water Act is not limited to its ordinary meaning, because the Legislature has provided a statutory definition that may supplant or even displace the ordinary meaning. [59] Additionally, the First Nation argues that interest in the land is not restricted to proprietary interests in land. The First Nation submits that, consistent with the purpose of the Water Act, a substantial interest is an interest of vital importance, both to the person who holds it and to the management of provincial water resources. The First Nation submits that its treaty rights are a substantial interest in the land, as those rights are constitutionally protected, are central to the First Nation s identity, and cannot be exercised apart from the First Nation s traditional territory. The First Nation notes that the Dictionary of Canadian Law, 4th ed., defines interest in land as follows: (a) Any estate in land less than an estate in fee simple, and (b) any interest, rights, easement, or right of way, in, to, or over, land other than the interest of the estate in fee simple. [emphasis in Appellant s submissions] [60] The First Nation further submits that, although treaty rights cannot be reduced to traditional common law property rights, that does not preclude them from constituting a substantial interest in land. It submits that treaty rights are not severed from land simply because they are partially codified or are agreed to in exchange for relinquishing claims to aboriginal title. [61] In support of those submissions, the First Nation refers to Haida Nation v. British Columbia, [2004] 3 S.C.R. 511 [Haida], at paras , where the Supreme Court of Canada stated, in the context of aboriginal rights and the Crown s duty to consult: the Provinces took their interest in land subject to any Interest other than that of the Province in the same (s. 109) [of the Constitution Act, 1867]. [62] Also, in a case involving Treaty 3, the Ontario Superior Court held that treaty rights to hunt and fish constitute an interest in land other than that of Ontario

13 DECISION NO WAT-013(a) Page 13 within the meaning of section 109 of the Constitution Act, 1867: Keewatin v. Minister of Natural Resources, 2011 ONSC 4801 [Keewatin], at para [63] Similarly, the majority of the Supreme Court of Canada held that a right to harvest fish and wildlife under a modern treaty constituted a continuing treaty interest in Crown lands to which their members continued to have a treaty right of access (emphasis added): Beckman v. Little Salmon/Carmacks First Nation, [2010] 3 S.C.R. 103, at para. 56 [Beckman]. [64] The First Nation acknowledges that the Crown may take up land under Treaty 8, and thereby reduce the area in which the First Nation may exercise its treaty rights. The First Nation submits, however, that the Manager does not claim that the Crown has taken up any part of the Tsea River watershed by issuing the Licence. [65] With regard to whether the First Nation is entitled to possession of land in the Tsea River watershed, the Water Act does not define possession. The First Nation submits that the plain meaning of possession, in the context of the Water Act, is not limited to proprietary interests that entail excluding others, such as fee simple or leasehold interests. The First Nation submits that, based on the definition of owner, possession has a broad meaning under the Water Act and may simply mean physical occupation of the land. The First Nation argues that its treaty rights to hunt, fish and trap entail a physical presence on the land, and include incidental activities such as travelling over and building structures on the land. The First Nation also submits that Treaty 8 assures the aboriginal signatories continued occupation of their traditional territory: Mikisew, at para. 47. [66] In support of those submissions, the First Nation referred to the Board s decision on the definition of owner in the former Waste Management Act (now the Environmental Management Act), and the meaning of possession in that context: Canadian Pacific Railway v. Deputy Director of Waste Management, Decision No WAS-046(a), issued October 18, 2006 [CP Railway]. [67] Finally, the First Nation submits that the land in the Tsea River watershed is likely to be physically affected by the withdrawal of up to 2,500,000 cubic metres of water from North Tsea Lake each year. In particular, the First Nation submits that the withdrawal could alter the water level of North Tsea Lake, which may impact the flow of water between the lake and adjacent shallow groundwater, which may affect soil and vegetation. Also, the First Nation argues that the withdrawal may cause scouring of the lake bed or bank near the water intake for the pump. In support of those submissions, the First Nation provided an affidavit by Julia O Shannassy, a professional engineer with experience in hydraulic, hydrology and water quality issues. However, Ms. O Shannassy did not testify at the hearing. The Manager s reply submissions [68] The Manager submits that interpreting provisions of the Water Act must take into account the statute as a whole, and how its provisions work together to achieve its purposes and objectives. In that regard, the Manager submits that the

14 DECISION NO WAT-013(a) Page 14 definition of owner is qualified by the requirement of possession, and therefore, the clause substantial interest must be a substantial interest giving rise to a possession type of interest in the land. The Manager argues that sections 5 and 7 to 16 of the Water Act indicate that the statute s purposes include ensuring that water rights are connected to or appurtenant to land, a mine or undertaking, and that such rights may be obtained through ownership or transfer of ownership of the appurtenant land, mine or undertaking. In this case, the First Nation has no such ownership in the land. [69] In support, the Manager refers to the definition of interest in section 232(1) of the Land Title Act, and submits that a lease, which is legally recognized and registerable, confers both possession and a substantial interest in land. In contrast, some forms of tenure only allow for entry onto land (such as a right of entry), and do not grant possession or a substantial interest in the land. [70] Similarly, in regard to possession, the Manager submits that the First Nation s treaty rights involve non-exclusive access and use of the land for hunting, trapping and fishing, and do not amount to possession of the land. The Manager argues that treaty rights to hunt, fish and trap are not dependent on possession or occupation of the land, in the sense of owning the land on which those rights are exercised. The Manager submits that the First Nation s submissions generally conflate its Treaty 8 rights with the rights associated with aboriginal title or other incidence of possession by aboriginal people, which are distinct types of rights: R. v. Marshall; R. v. Bernard, [2005] 2 S.C.R. 220, at paras. 38, 52 59, 70. The Manager maintains that the First Nation s treaty rights to hunt, fish and trap are more akin to aboriginal rights, as opposed to aboriginal title: Badger, at para. 77. The Manager also refers to judicial decisions which have held that aboriginal title cannot be registered in the land title system as an interest in land: Uukw v. British Columbia, [1987] B.C.J. No. 610 (B.C.C.A.); Skeetchestn Indian Band v. British Columbia (Registrar of Land Titles), [2000] B.C.J. No. 177, affirmed by [2000] B.C.J. No (B.C.C.A.)). [71] The Manager acknowledges that a proprietary type of interest in land arises in cases where aboriginal title is established and in relation to Indian reserves, and that those types of interests constitute substantial interests in land in the context of the Water Act. However, the Manager submits that any interest in land arising from treaty rights is incidental to the exercise of the right to hunt, fish or trap, and is not a proprietary interest: Sundown, at paras. 28, 34, 39, 42. The Manager submits that a licence to use land for a specific purpose does not create any estate or interest in land: Anger and Honsberger, Law of Real Property, 2 nd Ed., p [72] Similarly, the Manager submits that fishing licences and trapping licences do not confer an interest in land: Bolton v. Forest Pest Management Institute, [1985] B.C.J. No However, in closing arguments, the First Nation noted that, on appeal, the B.C. Court of Appeal held that a right of fishing may constitute a profit

15 DECISION NO WAT-013(a) Page 15 a prendre 1, and while a trapping licence does not give the holder any proprietary rights in wildlife or a right to restrict others from taking wildlife, it gives a right to take [wildlife] from the lands over which the registered trapline is given : Bolton v. Forest Pest Management Institute, Vancouver Registry No. CA004585, issued August 16, [73] The Manager submits that, even if some interest in the lands remains following their surrender under Treaty 8, such an interest is negated when the lands are put to a use that is incompatible with exercising the treaty right to hunt, fish and trap, and in this case, the First Nation asserts that the Licence may curtail the exercise of those rights. However, the Manager submits that the Crown has not taken up any part of the Tsea River watershed by issuing the Licence. [74] In addition, the Manager disputes the First Nation s submissions with regard to the meaning of various judicial decisions. For example, the Manager submits that the findings at paras of Haida are with respect to the Crown s ongoing duty to consult in relation to aboriginal rights claims, and are not conclusions on the nature of treaty rights. Regarding Keewatin, the Manager notes that the decision is under appeal to the Ontario Court of Appeal, and submits that the decision is inconsistent with Claxton, Badger, and Marshall. The Manager distinguishes Beckman on the basis that the treaty in that case used different language than Treaty 8 in stating the First Nation s rights to harvest fish and wildlife. The Manager also submits that, in Beckman, the Court did not find that the treaty right to harvest fish and wildlife constituted an interest in land. [75] Similarly, the Manager disputes the First Nation s submissions with regard to the Board s decision in CP Railway. Specifically, the Manager submits that the Water Act and the former Waste Management Act (now the Environmental Management Act) have different purposes, and there are important differences in definitions of owner in the two Acts. [76] Finally, the Manager submits that, if exercising a right to hunt, fish or trap gives rise to an interest in land for the purposes of the Water Act, it might extend appeal rights to non-aboriginal people who possess hunting and fishing licences. The Panel s findings [77] In considering the relevant provisions of the Water Act, the Panel is guided by the principles of statutory interpretation stated by the Supreme Court of Canada in Rizzo & Rizzo Shoes Ltd., [1998] 1 S.C.R. 27 at para. 21, citing with approval Elmer Driedger in The Construction of Statutes (2 nd ed. 1983), at p. 87: 1 Black s Law Dictionary, 7 th ed., 1999, defines profit a prendre as A right or privilege to go on another s land and take away something of value from the soil or from the products of its soil (as by mining, logging, or hunting).

16 DECISION NO WAT-013(a) Page 16 Today there is only one principle or approach, namely, the words of an Act are to be read in their entire context and in their grammatical and ordinary sense harmoniously with the scheme of the Act, the object of the Act, and the intention of Parliament. [78] The Panel is also guided by section 8 of the Interpretation Act, R.S.B.C. 1996, c. 238, which states: Every enactment must be construed as being remedial, and must be given such fair, large and liberal construction and interpretation as best ensures the attainment of its objects. [underlining added] [79] The Water Act has several purposes. The B.C. Provincial Court has stated that the Water Act protects the public ownership and use of water. The Act is regulatory in nature as it sets a licensing scheme for the lawful uses of water : Golden Eagle Ranch, at para. 4. The Court noted that section 2 of the Water Act vests the ownership, and the right to the use and flow, of all water in the Province in the Crown, except insofar as private rights have been granted by licences and approvals issued under the Water Act. [80] The Water Act s purposes also include the conservation and protection of water and riparian resources. The Board stated as follows in BC Ltd. v. Assistant Regional Water Manager (Decision Nos WAT-007(b) & 2007-WAT- 001(b), January 10, 2008), at paragraphs 157 to 158: [157] However, the Water Act is also a piece of environmental legislation. While it is primarily legislation to allocate, protect, preserve, and manage water as a resource, there are also indications that the Act also seeks to address broader stream health issues by protecting riparian habitat values. One of those indications is that the Act specifically defines a conservation purpose as that relating to conservation of fisheries and wildlife. Under section 1, conservation purpose means the use and storage of water or the construction of works in and about streams for the purpose of conserving fish or wildlife. [158] In addition, and of particular relevance to this case, the Act defines changes in and about a stream, broadly. It states: changes in and about a stream means (a) any modification to the nature of a stream including the land, vegetation, natural environment or flow of water within a stream, or [underlining added]

17 DECISION NO WAT-013(a) Page 17 [81] Section 92 of the Water Act creates a process whereby certain orders of statutory decision-makers in the Ministry may be appealed to the Board, which is an independent quasi-judicial tribunal. The appeal process is intended to be consistent with the principles of natural justice and administrative fairness: Hansard, supra, at p [82] The Panel has considered all of the Water Act s purposes in determining the intended meaning of the relevant provisions of the Act, and particularly, the standing provisions in section 92(1) and the definition of owner. [83] Section 92(1)(b) has two critical parts: (1) the person must be an owner of land; and (2) the person s land is or is likely to be affected by the order being appealed. Thus, the first question is whether the Appellant is an owner within the meaning of section 92(1)(b). The second question is whether the land is likely to be physically affected. The meaning of owner in the section 92(1)(b) of the Water Act [84] In deciding whether the Appellant is an owner within the meaning of section 92(1)(b), the definition of owner in section 1 of the Water Act must be considered: owner means a person entitled to possession of any land, mine or undertaking in British Columbia, and includes a person who has a substantial interest in the land, mine or undertaking; [underlining added] [85] In the present case, which does not involve a mine or undertaking, there are two important aspects of this definition: (1) an entitlement to possession of any land; and (2), the meaning of substantial interest in the land. [86] The Panel agrees with the Manager that the definition of owner is qualified by the requirement of possession. Specifically, the Panel finds that the phrase substantial interest in the land means a substantial interest in the land to which the person is entitled to possession. Thus, the Panel has considered the meaning of possession in the definition, followed by the meaning of substantial interest in the land. The meaning of possession in the definition of owner [87] The Manager s submissions focus on common law concepts of possession that entail exclusionary control and occupancy of land. However, the Panel finds that common law concepts of possession are not determinative in this case. The meaning of possession in the Water Act must take into account the word s context in the statutory definition of owner, and the use of owner in the context of the statutory appeal provisions. In addition, the present case involves the First Nation s treaty rights, which the courts have held must not be interpreted as if they were common law property rights.

18 DECISION NO WAT-013(a) Page 18 [88] The Panel has reviewed the dictionary definitions of possession provided in the Manager s authorities, and finds that those definitions support a finding that possession has a variable meaning, even at common law, and can mean different things in different contexts. In particular, Black's Law Dictionary, 4th ed., at p. 1229, states, in part: Possession and occupancy when applied to land, are nearly synonymous terms, and may exist through a tenancy. Thus, occupancy of a homestead, such as will satisfy the statute, may be by means other than that of actual residence on the premises by the widow or child. Walters v. People, 21 Ill Occupancy is always actual, as distinguished from possession, which may be actual or constructive. Occupancy is never constructive, save in the sense that land may be occupied through the actual possession of another. Davis v. State, 20 Ga. Appl. 68, 92 S.E. 550, 551. Occupancy is act of taking or holding possession and does not necessarily include residence. Kornhauser v. National Surety Co., 114 Ohio St. 24, 150 N.E. 921, 923. [underlining added] [89] The Oxford Companion to Law, at p. 970, states: The word possession is a legal concept of variable meaning, the word being used in different contexts with different meanings. It denotes a kind of relationship between a person and some object of property, real or personal. It is sometimes used as meaning merely physical control or detention, without any question of legal right. Secondly, it may mean legal possession which will be recognized and protected by law, and in this sense it is usually said that the elements are animus possidendi, intent to hold against others, and factum possidendi, the amount of occupation or control of which the thing is capable and which excludes strangers. [underlining added] [90] Based on those definitions, the Panel finds that possession may, in some contexts, be synonymous with occupancy, which is an act of taking or holding possession and does not necessarily include residence. [91] The Manager also referred to certain provisions of the Land Title Act as authority for the proposition that possession of land typically means exclusive possession of the land. However, the Panel finds that there are express differences between the definition of owner in the Water Act and that in the Land Title Act. The latter defines owner as follows: owner means a person registered in the records as owner of land or of a charge on land, whether entitled to it in the person's own right or in a representative capacity or otherwise, and includes a registered owner; [underlining added]