REAL PROPERTY TRANSACTIONS ON RESERVES

REAL PROPERTY TRANSACTIONS ON RESERVES Marilyn Poitras 205 Avenue G North Saskatoon, SK Research assisted by Merrliee Rasmussen, Q.C., Madisun Browne and Gloria Lee

Saskatchewan: Bar Admission Program i TABLE OF CONTENTS I. INTRODUCTION...1 II. RESERVE LANDS...2 A. INTEREST IN RESERVE LANDS...4 1. Individual Possession: Created by Allottment...4 a. Transfers of Individual Possession...5 b. Leases of Individual Possession...6 c. Mortgages Only on Leases of Lawful Possession...7 2. Use of Reserve Lands for Collective First Nation Purposes...7 3. Commercial Leases of Unallotted Reserve Land...8 a. Designations...9 b. Fiduciary Duties in Leases of Unallotted First Nations Land...11 c. Liability for Missed Rent Reviews...11 5. Expropriations...13 a. Compensation for Loss of Taxation Revenues and Lost Cultural Use...14 b. Reversionary Interests...15 II. ABORIGINAL TITLE LAND...15

Saskatchewan: Bar Admission Program 1 I. INTRODUCTION Real estate transactions on First Nations Reserves in Canada have a different constitutional basis than those for lands in the provincial Registry. Section 91(24) of the Constitution Act, 1867 stipulates that only the federal government has authority to make laws in regard to Indians and lands reserved for the Indians. This express power renders provincial real property laws relating to registration and transfer of titles, and ancillary legislation (about construction liens, enforcement of debts, etc.) inapplicable to reserve lands. 1 The Indian Act 2 creates the landholding system for Reserve lands and thereby exempts these lands from the statutory framework for real property transactions on other federal lands. 3 The law of fiduciary obligation informs the roles and obligations of the Crown and of First Nations Councils in these transactions, and is therefore necessary to understand the substantive procedures. After describing generalities of this system, this paper will point out some aspects of Aboriginal title. 4 and 5 In this paper, the term First Nations will refer to Indian Bands or Bands, the latter term being defined in the Indian Act. 6 The term First Nations Council or Council refers to the governing body of a First Nation and is also statutorily defined. 7 1 Delgamuukw v. British Columbia, [1997] 3 S.C.R. 1010, 153 D.L.R. (4 th ) 193 at para 178. 2 Indian Act, R.S.C. 1985, c. I-5, as am. 3 Real property transactions on other federal lands occur under the authority of the Federal Real Property and Federal Immovables Act, S.C. 1991, c.50. 4 In passing, I note that the First Nations Land Management Act, S.C. 1999, c. 24 as am. ( FNLMA ) recently came into force. The FNLMA sets up a procedure under which First Nations can develop their own land administration codes in accordance with federal guidelines, and thereafter exercise delegated authority to manage their own Reserve lands. At this point, First Nations in Saskatchewan have chosen not to join the FNLMA procedure. 5 Courts have not yet determined whether Metis people can succeed in establishing Aboriginal title. Issues relating to the origin and scope of Metis Aboriginal rights will likely be determined by the Supreme Court of Canada in two cases heard in the spring of 2003, R. v. Powley (2001), 196 D.L.R. (4 th ) 221 (Ont. C.A.) and R. v. Blais (2001), 198 D.L.R. (4 th ) 220 (Man. C.A.). 6 Supra, note 2 at s. 2(1). 7 Ibid.

2 Saskatchewan: Bar Admission Program This paper does not equip a practitioner to act in any transactions. It only introduces the subject and points to further resources. The Department of Indian Affairs and Northern Affairs Canada publishes a manual of its policies and procedures for these transactions. The voluminous Land Management Manual is available at www.ainc-inac.gc.ca and click on Publications and Research link to follow the Land Management links. II. RESERVE LANDS Reserves are lands held for the use and benefit of a First Nation, s. 18(1) of the Indian Act. Historically and typically, these lands were held by the Crown and set aside for the use and benefit of a First Nation by an Order in Council. However, the Federation of Saskatchewan Indian Nations, the Assembly of Entitlement Chiefs, Saskatchewan and the Crown negotiated the Saskatchewan Treaty Land Entitlement Framework Agreement which creates a system for First Nations to acquire lands for Reserves to compensate them for insufficient allocation of lands at the time of the Treaties. 8 For our purposes, the Reserves created under this process differ from other Reserves in two important respects: the Reserves are created without an Order in Council; and those Reserves are held by the First Nation rather than the Crown. Otherwise, Reserves created pursuant to a Treaty Land Entitlement Settlement Agreement will have the same attributes and will see the same kinds of transactions as other Reserves. In addition to these two means of creating a Reserve, the Court of Queen s Bench has determined that where a First Nation-owned holding company holds lands in trust in anticipation of the lands being converted into Reserve land to fulfill the Crown s Treaty Land Entitlement Settlement Agreement obligations, those lands may have Reserve status under the operation of s. 36 of the Indian Act, with the benefits thereof. 9 Courts have given considerable attention to the necessary and 8 The Agreement is available on-line at http://www.iaa.gov.sk.ca/aboriginal/html/md/md_ilr_intro.htm 9 Woodland Home & Building Products Ltd. v. Beardy s & Okemasis First Nation Department of Public Works, [2001] SKQB 235 (Q.B.). See also Lac La Ronge Indian Band v. Canada, [2000] 1 C.N.L.R. 245 (Sask. Q.B.).

Saskatchewan: Bar Admission Program 3 Sufficient conditions to create a Reserve, a point beyond the scope of this paper. 10 of the manner of creation, all Reserve lands have the following qualities: Regardless (a) The Aboriginal interest in Reserve land is held communally. 11 Accordingly, the members of a First Nation have input into any transaction that would affect their rights to use and enjoy the communal property. The extent to which individual First Nation members participate in the approval process depends on the extent to which the proposed disposition affects individual or communal interests. 12 In some instances a Band Council Resolution passed by the Chief and Council will be sufficient. In other instances, a full referendum of on- and off-reserve members will be necessary. (b) The interest is inalienable except to the Crown. 13 This interposes the Crown between every First Nation and any non-member of the Nation who wants to acquire an interest in the Nation s Reserve land. The Indian Act effects this by requiring that all transactions involving Reserve lands must be approved by the Minister or Governor in Council to be valid. 14 The Supreme Court of Canada has determined the Crown s pre-surrender/predesignation duty is only to prevent exploitative bargains. 15 (c) (d) (e) (f) Reserve lands and interests therein cannot be seized (s. 29 of the Indian Act). An encumbrance cannot be registered against land in a Reserve, with one exception: a leasehold interest in Reserve land may be mortgaged (the Indian Act, s. 89(1) and s. 89(1.1) respectively). All interests in Reserve land held by a First Nation member or by the First Nation are immune from taxation by the First Nation or other taxing authority (s. 87(1) and s. 87(2) of the Indian Act). All Reserves and interests in Reserves can be recorded in the Indian Lands Registry, maintained by the Department of Indian Affairs (s. 21 and s. 55(1) of the Indian Act). 10 See Musqueam Holdings Ltd. v. Vancouver Assessor (2000), 187 D.L.R. (4 th ) 510 (B.C.C.A.) (leave to appeal to S.C.C. refused) and Ross River Dena Council Band v. Canada, [2002] S.C.C. 54. 11 Osoyoos Indian Band v. Oliver (Town), [2001] 3 S.C.R. 746 at para 42. 12 Opetchesaht Indian Band v. Canada, [1997] 2 S.C.R. 119 at para 53. 13 Guerin v. The Queen, [1984] 2 S.C.R. 335 at 383. 14 Section 28(1) of the Indian Act voids any document or agreement of any kind in which a First Nation or member purports to allow a non-member to use or occupy Reserve lands. Section 20(1) states a member can only have lawful possession of Reserve land when the allotment by the First Nations Council has been approved by the Minister. 15 Blueberry River Indian Band v. Canada, [1995] 4 S.C.R. 344 at para 35.

4 Saskatchewan: Bar Admission Program The Indian Lands Registry tracks documents relating to legal status of Reserve lands. The Registry also contains electronic copies of many registered documents: certificates of possession, designations, leases, permits, rights of way, and orders in council. As well, it contains links to surveys of the lands. The Indian Lands Registry is accessible online at http://pse-esd.ainc-inac.gc.ca/esd-pse/index_all_e.asp and can also be found if you google Indian Lands Registry. The Registry has several significant shortfalls: (a) (b) (c) (d) the Registry is not guaranteed to be accurate (it is not uncommon for there to be unregistered interests and errors in registration of documents); the Registry does not track priority of interests; Builders liens and other creatures of provincial law cannot be registered in the Indian Lands Registry; 16 and the Indian Act does not require interest holders to register transactions except for those relating to designated or absolutely surrendered lands. 17 With this background in place, we can look at the various kinds of interests in reserve lands and the nature of the typical transactions of each. A. INTERESTS IN RESERVE LANDS 1. Individual Possession: Created by Allottment Generally, a member of a First Nation can acquire the right to exclusive use and occupation of Reserve lands by one of two means: by First Nation custom or under the Indian Act. Under the authority of s. 20(2) of the Indian Act, a First Nation Council may allot a parcel of land to an individual member of the First Nation, who then has the right to exclusive use and 16 Palm Dairies Ltd. v. R., [1979] 2 C.N.L.R. 43 at 51 (Fed. T.D.). 17 Section 55(1) requires maintenance of the Registry for surrenders and s. 55 (4) deems a registered assignment valid against an unregistered assignment or even a previous assignment registered after the registered one.

Saskatchewan: Bar Admission Program 5 occupation of the land, also known as the right to lawful possession. The Crown continues to hold legal title to these lands 18 and the status as Reserve lands is retained. Once the Minister of Indian Affairs approves the allotment, a Certificate of Possession will be issued by the Department of Indian Affairs and registered in the Indian Land Registry. Once the Certificate of Possession is issued, other members of that First Nation lose their collective rights to use that land. 19 The Certificate of Possession is evidence that the person, the locatee, holds lawful possession of the lands. If the Minister declines to approve an allotment, the Minister may authorize the person to use and occupy the land under a Certificate of Occupation (s. 20(5) of the Indian Act). As mentioned, some First Nations opt out of the statutory system and manage the various aspects of individual land-holding themselves. These customary practices will not give rise to any rights enforceable under the Indian Act, but might nevertheless be enforceable. 20 Lawful possession may be held jointly by two or more individuals, either as tenants in common or in joint tenancy. The British Columbia Supreme Court has ruled that provincial statutes provide no basis on which it could order partition and sale of lawful possession held by joint tenants. 21 a. Transfers of Individual Possession A locatee may give, trade or sell his/her interest, but only to another member of the First Nation or to the First Nation itself (under section 24 of the Indian Act). Such transfers only take effect upon approval by the Minister. A locatee can bequeath her/his interest in the land in a will. Such gifts are valid as long as they are gifts to another member or to the First Nation. Otherwise the gifts are invalid. 22 18 Westbank Indian Band v. Normand, [1994] 3 C.N.L.R. 197 (B.C.S.C.). 19 Boyer v. Canada, [1986] 2 F.C. 393 (C.A.), leave to appeal to S.C.C. refused (1986), 72 N.R. 365n (S.C.C.). 20 See Jack Woodward, Native Law, (Toronto: Carswell, 1994) at 286.1. 21 Darbyshire-Joseph v. Darbyshire-Joseph, [1998] B.C.J. no. 2765 (B.C.S.C.). 22 See the Family Law Bar Admission Program Materials and the Wills and Estates Materials for a full discussion of these points.

6 Saskatchewan: Bar Admission Program b. Leases of Individual Possession At the request of a locatee, and under the authority of s. 58(3) of the Indian Act, the Crown may lease the locatee s interest to another person member, non-member or corporate body. These leases, often called locatee leases, do not require the approval of the First Nation Council (in a Band Council Resolution) or approval of the membership (by way of designation) as long as the lease term is less than 49 years. 23 This stands in stark contrast to leases of designated lands, which require both consents in a time-consuming and work-intensive process. If the term of the lease exceeds 49 years, the Minister s approval is required for a locatee lease. The Department of Indian Affairs policy states that the Minister will only consent to a 50+ year lease where the First Nation membership has approved the lease in a vote. 24 Regardless of the term of the locatee lease, the Crown has a fiduciary duty to ensure the lease would not undermine the objectives of the Indian Act. 25 In some instances the bylaws of the First Nation 26 may constrain terms on which a locatee may lease his/her interest. For example, the First Nation may have bylaws respecting land use. These bylaws should be checked to ensure the project complies, or alternatively, assurances should be sought from the First Nation that the project is within the bylaws. Three common issues occur with on-reserve locatee leases, and leases of designated lands alike: (a) (b) The standard lease terms obligate the Crown to conduct periodic market rent adjustments called rent reviews. Liability may occur where the Crown fails to make these adjustments to the detriment of the First Nation. Default of a headlease jeopardizes the interests held by sublessees and mortgagors of sublessees. 23 See Land Management Manual, Chapter 7 at 45 for procedures for leases with terms of 49 years or less. 24 Ibid at 46. The reason for this distinction is that long term locatee leases may simply be attempts to avoid the designation or surrender procedures, in which members have input into the project. 25 Tsartlip Indian Band v. Canada (Minister of Indian Affairs and Northern Development), [2000] 2 F.C. 314 (Fed. C.A.) at para 59. 26 Section 81(1)(g) confers authority on the Council to make laws regarding land use and zoning.

Saskatchewan: Bar Admission Program 7 (c) First Nations or locatees direct the Crown to enter nominal rent leases with First Nationowned companies; the developments then occur at the sublease levels; and rent proceeds flow directly to the First Nation. These issues will be discussed below in the part addressing leasing of unallotted land. c. Mortgages Only on Leases of Lawful Possession Section 89 of the Indian Act operates to nullify any usual mortgage given by a financial institution against a Certificate of Possession. It permits only another member of the First Nation or the Nation itself to register a mortgage or attach an interest in real property on Reserve. 27 This is consistent because only a member or a First Nation can hold the right to possession. So if neither the First Nation nor other members are in the practice of offering financing, the locatee cannot secure a loan with her/his interest. The Indian Act does, however, permit locatees to lease the interest in lands, which leasehold interest can be mortgaged. 28 However, s. 20(1) states the only interest a First Nation member can hold in Reserve land is exclusive possession that is, a Certificate of Possession. This creates an anomaly because a locatee cannot mortgage his/her own home with an off-reserve financial institution, but can lease it to someone else who can obtain a mortgage of their leasehold interest. If a lessee defaults on lease payments, or otherwise fails to fulfill the terms of the locatee lease, a mortgagor must cure any possible default or else risk termination of the lease and of the mortgagor s interest therein by the lessor. 2. Use of Reserve Lands for Collective First Nation Purposes 29 Section 18(2) of the Indian Act authorizes the use of Reserve lands for the general welfare of the First Nation. It establishes a process and certain thresholds which must be met by a proposed 27 28 29 See Land Management Manual, c. 3-8: Band Mortgages. Section 58(3). Land Management Manual, chapter 4. The general procedure for these transactions is summarized at 4-7.

8 Saskatchewan: Bar Admission Program project under s.18(2) of the Indian Act. Any project under this section must either be on the list in s.18(2) (e.g., First Nations schools, building for administration of First Nations affairs, health projects or burial grounds) or it must have the consent of the Council and be for the general welfare of the band. Projects in the second category must benefit the community as a whole and be available to all members of the First Nation. According to the Manual, private businesses and utilities that do not serve the Reserve must acquire an interest in Reserve land otherwise than by s. 18(2) to proceed. 30 The First Nation Council must authorize the proposed use in a Band Council Resolution. The First Nation must obtain an environmental assessment under the Canadian Environmental Assessment Act 31 and provide it to the First Nation and to the Crown. If a First Nation Council wants to develop lands under s. 18(2), but the lands have been allotted to a First Nations member, the First Nation Council can negotiate a settlement with the member or use an established process for working with non-consenting holders of lawful possession. 32 3. Commercial Leases of Unallotted Reserve Land 33 Under s. 53(1) of the Indian Act, unallotted land in a Reserve may be leased in either of two ways: (a) (b) Once land has been designated 34 it can be leased. The designation will prescribe or limit the terms of the lease(s), such as the permitted use of the land. Uncultivated or unused, and unallotted land can be leased for agricultural or grazing purposes. 35 Since non-exclusive possession is often sufficient for these purposes, a permit may be issued rather than a lease. Agricultural and grazing leases do not require designations of the land. 30 Ibid. at 3. 31 Canadian Environmental Assessment Act, S.C. 1992, c. 37. 32 See the Land Management Manual, chapter 4 at 5-6. 33 Leasing of allotted lands was addressed in II, A. 1.(b) - Leases of Individual Possession. For further information on the current subject, see the Land Management Manual, Chapter 7, Directive 7-2. The Manual contains detailed checklists which will be helpful to anyone familiarizing themselves with the processes. Note that the checklists are for the Department s purposes and will not be sufficient for legal purposes, especially when your client is the developer or the First Nation. 34 Under s. 38(2) of the Indian Act. 35 See s. 58(1)(b) of the Indian Act.

Saskatchewan: Bar Admission Program 9 A lease confers exclusive use and possession on the lessee. So the membership must, for the term of a lease of Reserve lands, give up their collective rights over the leased land. All on- Reserve commercial leases of unallotted lands (whether the lessee is a First Nation-owned corporation, a private company or individual) must comply with the leasing and designation procedures under the Indian Act and Indian Referendum Regulations. 36 a. Designations 37 Under the Indian Act, if a First Nation wants to lease its interest in Reserve land to a non- Member (including a First Nation-owned corporation), it must go through a formal process called designation or designation by way of surrender with respect to the lands to be leased. A designation will set the permitted uses, the land to be designated and the term of the designation. These terms prescribe limits on all leases entered pursuant to a specific designation. All leases under that designation must have terms shorter than the designation. The terms surrender and designation are synonymous with one qualification: where a First Nation consents to the Crown attempting to sell or selling the First Nation s full interest in Reserve land, the First Nation is said to have absolutely surrendered its interest in the land. The term designation is not used to refer to absolute surrenders. Absolute surrender of the full interest in land (as opposed to a designation or an absolute surrender of an easement) removes the lands from the Reserve, whether the lands are actually sold or not. 38 In contrast, designations never remove lands from Reserve. 39 36 See s. 37-41 of the Indian Act, and the entire Indian Referendum Regulations, C.R.C. 1978, c. 957 as am. The Regulations apply to referenda held under s. 39(1)(b)(iii) or s. 39(2) of the Act. (Section 1.1, IRR) 37 The federal Crown is currently revising its designation procedures. Though the statutory framework will not change, it is not known whether the new procedures will render this material inaccurate. 38 St. Mary s Indian Band v. Cranbrook (City), [1997] 2 S.C.R. 657. 39 See Woodward, supra note 20 at 274.

10 Saskatchewan: Bar Admission Program There are two kinds of designations: general and specific. 40 A First Nation would typically use a general designation to zone an area for a type of land use or a few types, such as commercial, industrial or residential. General designations usually occur at the stage in a development where the terms of all proposed leases under the designation have not been negotiated. Since the membership is approving granting exclusive use of their collective lands without details of the projects, a general designation will often provide for the members to vote again when the lease is finalized. Alternatively, the general designation document might empower the Chief and Council to approve the terms of all leases granted under the designation. In both cases, the membership can determine whether the lease comes back to them for approval or merely go to the Chief and Council. Specific designations usually pertain to one development or project and the terms of the lease are put before the membership to give them complete information about the rights the lessor will have over the collectively held lands during the term of the lease. As a matter of federal policy, a proponent of a lease (and designation) must obtain an environmental assessment under the Canadian Environmental Assessment Act, evaluating the current state of the lands and the anticipated impact of the particular development on those lands. This information should also be provided to the membership before the vote. When lands are designated and leased, the Reserve status of the lands continues, as do the tax exemptions and other consequents. The First Nation s right to use and occupy the land will resume upon expiration of any lease. In the first step of a designation, in a Band Council Resolution, the First Nation Council requests the Minister to designate particular lands for a certain time and for specific purposes. The Council also requests the Minister conduct a referendum, in which all members receive 40 This distinction originates in practice and not in either the Act or in case law.

Saskatchewan: Bar Admission Program 11 information about the proposed development and then vote on the designation. Members residing off-reserve have equal right to receive information on the designation and to vote. 41 The Indian Referendum Regulations set the procedure for all designation votes. b. Fiduciary Duties in Leases of Unallotted First Nations Land Both the Crown and the First Nation Council owe fiduciary duties to the members of the First Nation wherever an interest in the communal lands is proposed to be granted to a non-member (i.e., by s. 28(2) permit or s. 53(1) lease). In particular, the transaction must be at fair market value and not otherwise be exploitative. 42 The proponent of the development must provide an environmental assessment under the Canada Environmental Assessment Act, which shows the anticipated impact on the lands of this activity. Basically, the members must be given full and complete information about the proposal in order for them to give informed consent to the designation and lease. Where a First Nation has, by designation or absolute surrender, given the Crown authority and discretion to manage the lands on conditions, the Crown owes a fiduciary obligation to deal with the lands in the best interests of the First Nation and in accordance with the conditions. 43 c. Liability for Missed Rent Reviews Since many leases are for several decades and given the Crown s fiduciary obligations, leases typically include a clause for an adjustment to market rent to occur every five years at a minimum. 44 Then, for example, a lease may require that every five years the Crown will determine the fair market value of the interest being leased to the lessee and advise the lessee of this value, which will then be payable as rent for the next five years until another rent review occurs. Liability may arise where the Crown fails to fulfil its contractual duty to obtain an appraisal. 41 42 43 44 Corbiere v. Canada (Minister of Indian and Northern Affairs), [1999] 2 S.C.R. 203. Guerin and Blueberry River Indian Band, supra note 15 at para 45. Ibid., Blueberry River. Land Management Manual, Chapter 7 at 18.

12 Saskatchewan: Bar Admission Program d. Nominal Rent Leases As First Nations seek legal means to exercise greater control over their legal and financial affairs, some seek to deal directly with land developers without the intervention of the Crown. In leasing contexts, frustration arises because all rents due under leases are first paid to the Crown, and then the Crown transfers the money to the First Nation. Some First Nations have set up First Nation-owned companies and then requested the Crown to designate certain lands and issue leases to these First Nation-owned companies 45. Then the actual development occurs at the sublease level, between the First Nation-owned company and developers. The Crown has some best practices for these situations to ensure the financial benefit of the leases flows to the membership, 46 for both the Crown and the First Nation owe a fiduciary obligation to the membership that where members give up communal rights to land, the benefits of granting rights to others must flow to the community as a whole. One must understand the scope of the parties fiduciary obligations in these kinds of transactions in order to give proper legal advice. 4. Permits for Non-exclusive Use of Reserve Lands Where an individual non-member of a First Nation or a company desires access to or across Reserve lands for purposes other than for the benefit of all members, it can receive a right to non-exclusive use of the lands with a permit under s. 28(2) of the Indian Act. Under the authority of s. 58(4), and typically with the consent of the First Nation Council, the Crown can also issue permits for the removal of clay, sand, gravel and other non-metallic substances. A permit will be over specific lands and will also limit the use for a specific purpose. While there is no limit on the terms of permits, the term must be determinable. 47 And since a permit grants non-exclusive use, several permits may be issued in respect of the same lands as long as the uses do not conflict. 45 Often the First Nation-owned company will have some of the Chiefs and Council members as directors. There is potential for conflict of interest and at least an appearance of conflict of interest in these situations. 46 See Land Management Manual, Chapter 7 at 18-19. 47 Opetchesaht, supra at para 50.

Saskatchewan: Bar Admission Program 13 To obtain a permit, first the First Nation Council must pass a Band Council Resolution directing the Department of Indian Affairs to issue a permit to the permittee over delineated lands for certain purposes. Then the permittee negotiates the details of the permit with the Crown. 5. Expropriations 48 There are two kinds of transactions which see a Reserve lose its status as such, and thereby lose all consequent legal attributes: expropriations and absolute surrenders. These will be addressed in turn. Provincial and municipal governments and certain corporations have various statutory authorities to take lands for public purposes. Those laws, in themselves, do not empower the body to expropriate Reserve lands. Under s. 35 of the Indian Act, where the Governor-in-Council consents to the transaction, an expropriating authority may take a full interest or an easement interest from Reserve lands. Every expropriation is legally limited by the following: (a) (b) The original authority of the expropriating body. Section 35 does not expand the conditions under which it can take lands; it merely extends the authority to apply to reserve lands. 49 The Governor-in-Council may impose any terms it sees fit in the transaction before granting consent. Under current federal policy, when the Crown transfers any interest in Reserve land under s. 35, the Crown expressly retains a reversionary interest. Then when the public purpose underlying the expropriation is satisfied, the expropriating body is obligated to return the lands to the Crown. 50 However, the policy is that such lands will not automatically be set aside as reserve lands again. As a matter of policy, the Crown requires the expropriating authority to obtain the consent of the First Nation, save in exceptional circumstances. 51 Typically the authority will negotiate compensation and other issues directly with the First Nation. 48 49 50 51 See Land Management Manual, Chapter 9. Osoyoos v. Town of Oliver, [2001] SCC 85 at para 59. Land Management Manual, Chapter 9 at 6. Ibid. Chapter 9 at 9.

14 Saskatchewan: Bar Admission Program Once the Governor-in-Council approves it, the transfer may proceed by either of two means. It may go ahead as an expropriation under the referentially incorporated legislation. Or, given that the First Nation has agreed to the removal of the lands from Reserve, the Governor-in-Council may merely authorize a transfer. 52 Regardless of whether the transaction occurs under s. 35 or under the Federal Real Property and Possession of Federal Immovable Act, the Crown has onerous fiduciary obligations to the First Nation whose land is being taken. The Crown must grant the minimum interest necessary for the expropriating authority to accomplish its public purpose. 53 Where an easement interest is taken from the Reserve, perhaps obviously, First Nations members will continue to be entitled to use that land as long as their use is not incompatible with the public use. For example, s. 35 easements are often used when a public utility needs to run transmission lines, pipelines, water or sewage lines or gas lines through a reserve. Since Opetchesaht, however, the Supreme Court of Canada has clarified that many of these interests and public purposes may be accommodated by granting permits under s. 28(2). 54 a. Compensation for Loss of Taxation Revenues and Lost Cultural Use One consequence of taking the full interest in land from the Reserve, rather than a permit, for example, is that the First Nation loses taxing authority over non-members use of the lands. So in negotiating compensation for the expropriation of the entire interest in Reserve land, the First Nation will be entitled to compensation for lost tax revenues. In Osoyoos, the Court further held that the expropriating authority owes compensation to the First Nation for lost cultural use and value of the lands. 52 This second type of dispositions occur under the authority of the Federal Real Property and Possession of Federal Immovables Act. 53 Osoyoos, supra at para 53. 54 Opetchesaht, supra.

Saskatchewan: Bar Admission Program 15 b. Reversionary Interests Typically and usually, the Band Council Resolution and the transfer of lands from the Crown to the expropriating authority will specify that when the interest in lands is no longer required for the public purpose, the authority will convey the interest back to the Crown. In some instances the documents will evidence an obligation for the Crown to set the lands aside as Reserve again, and in other cases the Crown may have no such duty to return the land to the First Nation. In some instances the expropriation legislation will not permit the authority to alienate the land, and require its return to the Crown. III. ABORIGINAL TITLE LANDS In Saskatchewan, First Nations surrendered their Aboriginal title in exchange for various Treaty benefits, so Aboriginal title has less relevance than elsewhere. That said, there may be instances where Aboriginal title occurs in Saskatchewan, for example, if the Metis succeed. Based on Delgamuukw 55, it appears that any lands found to be Aboriginal title lands will necessarily render the lands to be lands reserved for the Indians under s. 91(24), even if they are registered in the provincial land registry system and held by a non-status person. This and other related points may be determined in the coming years in cases like the Haida s claim to Aboriginal title of their traditional lands. Until recently, there were no direct legal consequences of a First Nation asserting certain lands are their traditional lands. Four recent cases from the British Columbia Court of Appeal have found obligations and rights when a First Nation asserts a strong prima facie claim to Aboriginal rights or title. 56 55 56 Ibid., note 1. The Supreme Court of Canada granted leave to hear all four cases.

16 Saskatchewan: Bar Admission Program In Council of the Haida Nation v. B.C. (Minister of Forests) and Weyerhaeuser, 57 and Taku River Tlingit First Nation v. Redfern Resources Ltd., 58 the B.C. Court of Appeal held where First Nation has asserted a good prima facie case of Aboriginal rights or title, the Crown and third parties have a duty to accommodate the Aboriginal interest. The consultation must be meaningful and ongoing during the project. The decision in Haida is noteworthy because the Court held Weyerhaeuser had a legally enforceable duty to consult with the Haida First Nation and a further duty to seek a workable accommodation of the Haida s interest. Weyerhaeuser owed this duty notwithstanding the Province issued it a license to harvest trees on the land. Before Haida, only the Crown was thought to owe a duty to consult with First Nations. In certain narrow circumstances, assertion of Aboriginal title in a statement of claim may form a basis for an application for the Crown to pay the First Nation s costs in the action. In British Columbia (Minister of Forests) v. Jules 59 and William v. Riverside Forest Products Limited and B.C. 60, the British Columbia Court of Appeal determined that a claimant may be entitled to have her/his costs paid by the Crown in advance of the trial and in any event of the cause. The Court held that in unique and exceptional circumstances, where the plaintiff has exhausted all other funding sources and has brought a case of great public importance, it may be appropriate for the Crown to pay the plaintiff s costs regardless of whether the plaintiff is successful at trial. This sort of argument could presumably be adapted to Treaty contexts and assertions of Treaty rights. 57 58 59 60 Haida Nation v. Weyerhaeuser, [2002] B.C.C.A. 147. Taku River Tlingit First Nation v. Redfern Resources Ltd., [2002] B.C.C.A. 59. British Columbia (Minister of Forests) v. Jules (2001), 208 D.L.R. (4 th ) 301. William v. Riverside Forest Products Limited and B.C., [2002] B.C.C.A. 434.