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Fraser Institute blames courts for mining slow down

Court decisions around First Nations land claims and consultation are creating uncertainty and discouraging investment in the Yukon's mining industry, according to a new report from the Fraser Institute.

Court decisions around First Nations land claims and consultation are creating uncertainty and discouraging investment in the Yukon’s mining industry, according to a new report from the Fraser Institute.

The report, released last week, says court cases like the recent challenge of the Peel watershed land use plan show that Yukon courts are going beyond the terms of modern treaties and imposing “unforeseen obligations” on governments.

It includes data showing that more and more mining executives see uncertainty around land claims as a deterrent to investment in the Yukon. The data was taken from the institute’s annual survey of mining companies, which has seen the Yukon drop in the ranking for investment attractiveness over the last two years.

Malcolm Lavoie, a visiting assistant professor at the University of Alberta’s law faculty and a co-author of the report, said the increasing uncertainty is linked to the way the Yukon’s modern treaties have been interpreted.

Eleven of the territory’s 14 First Nations signed final agreements between 1990 and 2006, and are now self-governing.

Lavoie pointed to the Little Salmon/Carmacks First Nation court case settled in 2010, that found the duty to consult can extend beyond what is laid out in treaty agreements. He said that case established a precedent for courts requiring more from the government than what is specified in the treaties.

“There isn’t great cause to go beyond (the treaties),” he said. “It isn’t like it’s necessary to go beyond the terms of a treaty like this to protect aboriginal rights.”

He also referred to the Peel watershed case, which he said might have had a different outcome if the court had adopted “a stricter mode of interpretation” of the treaties.

He refrained from saying whether or not he believes the government should have done more to consult with First Nations before introducing its land use plan, but said that’s not really the point.

“There’s a distinction between what a government should do and what it’s obligated to do,” he argued. “My sense of the decision is that what the government ultimately did was something it was entitled to do under the agreement.”

The report suggests that First Nations and the government should stick more closely to the terms laid out in the final agreements to keep future matters out of the courts and to increase investor confidence in the territory’s mining industry once again.

“If you take an approach that holds parties in strict terms… that allows the First Nations also to have certainty,” Lavoie said. “Certainty benefits both parties.”

But Ken Coates, a professor of public policy at the University of Saskatchewan, said the Fraser Institute report takes a very “short-term view” of mining in the Yukon.

“The treaties have actually created a much clearer environment in which mining companies can work,” he said. “It’s a little bit of uncertainty in an environment where there was a lot more uncertainty before.”

He said treaties establish the minimum that governments must do to respect the rights of First Nations, and were not meant to address every eventuality. “If treaties are going to be narrowly interpreted to reflect the world as it was in 1993, we’ve got a problem.”

Coates said it’s to be expected that First Nations will do what they can to protect their rights, including testing them in court. He argued that anyone else would do the same.

“I get kind of frustrated, because (the report) sort of has this impression that if First Nations would only back off… we’d have this mining nirvana in the Yukon.”

Yukon lawyer Stephen Walsh agreed that the court has an important role to play in clarifying rights and responsibilities under the final agreements.

“That’s what courts are there to do,” he said. “Where else do you go?”

Walsh represented the Ross River Dena Council in a 2012 decision when it won the right to early consultation before mineral claims are staked. That case was also listed in the Fraser Institute report as another example of increased uncertainty from a court decision.

But Walsh questioned the whole premise of the report, which he said has a “sky-is-falling quality to it.” He said he’s not sure that treaty obligations are discouraging investment at all.

“I don’t take everything that the Fraser Institute says as gospel,” he said. “(Mining companies) don’t seem to be scared away by having to consult with First Nations.”

Instead, he blamed declining commodity prices for the slow-down in investment.

Janet Lee-Sheriff, chief executive officer of Golden Predator Mining Corp., also dismissed the report’s conclusions.

“I don’t agree,” she said. “First Nation relations are not the reason for lack of investor confidence in the Yukon.”

She referred instead to a global decline in the mining sector, and said the Yukon was shielded from that decline for a few years because of the discovery of the White Gold deposit north of Dawson.

But now, she said, investors are very cautious with their money. “They want to see really good economics. And that, to me, is one of Yukon’s challenges: how to compete with jurisdictions that don’t have as much distance to market.

“It’s my strong belief that First Nations relations and First Nations issues are not a factor.”

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