Wewaykum Indian Band v. Canada

Wewaykum Indian Band v. Canada
Collection
Supreme Court Judgments
Date
2002-12-06
Neutral citation
2002 SCC 79
Report
[2002] 4 SCR 245
Case number
27641
Judges
McLachlin, Beverley; L'Heureux-Dubé, Claire; Gonthier, Charles Doherty; Iacobucci, Frank; Major, John C.; Bastarache, Michel; Binnie, William Ian Corneil; Arbour, Louise; LeBel, Louis
On appeal from
Federal Court of Appeal
Subjects
Aboriginal law
Action
Notes
SCC Case Information: 27641
Decision Content
Wewaykum Indian Band v. Canada, [2002] 4 S.C.R. 245, 2002 SCC 79
Roy Anthony Roberts, C. Aubrey Roberts and
John Henderson, suing on their own behalf and on
behalf of all other members of the Wewaykum Indian
Band (also known as the Campbell River Indian Band) Appellants
v.
Her Majesty The Queen Respondent
and
Ralph Dick, Daniel Billy, Elmer Dick, Stephen Assu
and James D. Wilson, suing on their own behalf and
on behalf of all other members of the Wewaikai Indian
Band (also known as the Cape Mudge Indian Band) Respondents/Appellants
and between
Ralph Dick, Daniel Billy, Elmer Dick, Stephen Assu,
Godfrey Price, Allen Chickite, and Lloyd Chickite,
suing on their own behalf and on behalf of all other
members of the Wewaikai Indian Band
(also known as the Cape Mudge Indian Band) Appellants
v.
Her Majesty The Queen Respondent
and
The Attorney General for Ontario, the
Attorney General of British Columbia, the
Gitanmaax Indian Band, the Kispiox Indian Band
and the Glen Vowell Indian Band Interveners
Indexed as: Wewaykum Indian Band v. Canada
Neutral citation: 2002 SCC 79.
File No.: 27641.
2001: December 6; 2002: December 6.
Present: McLachlin C.J. and L’Heureux‑Dubé, Gonthier, Iacobucci, Major, Bastarache, Binnie, Arbour and LeBel JJ.
on appeal from the federal court of appeal
Indians — Reserves — Crown’s fiduciary duty — Content of Crown’s fiduciary duty before and after reserve is created.
Indians — Reserves — Crown’s fiduciary duty — Two B.C. Indian bands claiming each other’s reserve land — Both bands alleging that they would possess both reserves but for breaches of fiduciary duty by federal Crown — Bands seeking declarations against each other and equitable compensation from Crown in Federal Court — Whether Crown breached its fiduciary duty — Whether “equitable” remedies available — Whether defences of laches and acquiescence apply.
Limitation of actions — Federal Court — Indian claims — Two B.C. Indian bands claiming each other’s reserve land — Both bands alleging that they would possess both reserves but for breaches of fiduciary duty by federal Crown — Bands seeking declarations against each other and equitable compensation from Crown in Federal Court — Whether bands’ claims statute barred — Federal Court Act, R.S.C. 1985, c. F‑7, s. 39 — Statute of Limitations, R.S.B.C. 1897, c. 123, s. 16 — Limitations Act, S.B.C. 1975, c. 37, ss. 3(4), 8, 14(3).
Two bands of the Laich‑kwil‑tach First Nation claim each other’s reserve land. Each reserve has been possessed by the incumbent band since the end of the 19th century. Neither band claims title based on an existing aboriginal or treaty right but each band, resting its claim on contemporaneous documentation of the Department of Indian Affairs, says it would possess both reserves but for breaches of fiduciary duty by the federal Crown. The bands seek declarations against each other and equitable compensation from the federal Crown. The Cape Mudge Band, the Wewaikai, seeks Reserve 11 and the Campbell River Band, the Wewaykum, claims Reserve 12.
The claim of the Cape Mudge Band starts with the 1888 report of a federal government surveyor which recommended the creation of Reserves 11 and 12. These reserves were not identified as allocated to a particular band, but rather to the “Laich‑kwil‑tach (Euclataw) Indians”. The 1892 schedule of Indian reserves published by the Department of Indian Affairs, listing reserve allocations to bands, repeated this allocation. By 1900, Reserves 11 and 12 were shown on the schedule as allocated to the “Wewayakai [Cape Mudge] band”. On numerically ordered lists of reserves, the name We‑way‑akay was inscribed opposite Reserve 7 and ditto marks were inscribed below that name opposite Reserves 8 to 12. The Cape Mudge Band on that basis claims both reserves although it was not, and never had been, in occupation of Reserve 11.
The claim of the Campbell River Band flows from a 1905 dispute between the two bands over fishing rights, which led to a dispute over possession of Reserve 11. In a 1907 Resolution, the Cape Mudge Band ceded any claim over Reserve 11 to the Campbell River Band subject to the retention of common fishing rights. The effect of the resolution was recorded in a change to the departmental schedule. The name of the “We‑way‑akum band” was entered opposite Reserve 11, but in what became known as the “ditto mark error”, the ditto marks against Reserve 12, directly beneath it, remained unchanged. The Campbell River Band relies on the departmental schedule, as changed, as evidence of its right to both Reserve 11 and Reserve 12.
In 1912, the McKenna McBride Commission visited the proposed reserves in the Campbell River area. It acknowledged that Reserve 11 was properly allocated to the Campbell River Band and noted the error with respect to Reserve 12 which, because of the ditto marks, appeared in the schedule as being also allocated to that band. In their respective submissions to the Commission, in accordance with actual incumbency, the Campbell River Band made no claim to Reserve 12 and the Cape Mudge Band made no claim to Reserve 11. However, the “ditto mark error” on the schedule was not corrected.
In 1924, by Orders‑in‑Council, the British Columbia government and the federal government adopted the McKenna McBride recommendations with respect to Reserves 11 and 12. In 1928, the Indian Commissioner recommended that Reserve 12, which had always been claimed by the Cape Mudge Band, should officially be recognized as belonging to that band and the federal schedule modified accordingly. Both bands retained legal counsel to investigate. In 1936 and 1937, each band issued a declaration listing its reserves. Neither band listed the other’s reserve it now claims.
In 1938, British Columbia issued Order‑in‑Council 1036 which transferred administration and control of the subject lands to the Crown in right of Canada. In 1943, Indian Affairs published a corrected schedule of reserves listing Reserve 11 for the Campbell River Band and Reserve 12 for the Cape Mudge Band. No formal amendments were made to orders‑in‑council that had appended the previous faulty schedules. The dispute resurfaced in the 1970s and, in 1985, the Campbell River Band initiated its action against the Crown and the Cape Mudge Band. The Cape Mudge Band counterclaimed for exclusive entitlement to both reserves and, in 1989, added a claim against the Crown. After 80 days of evidence and submissions, the Federal Court, Trial Division dismissed both bands’ claims and the Federal Court of Appeal upheld that decision.
Held: The appeals should be dismissed.
The legal requirements to create a reserve within the meaning of the Indian Act include an act by the Crown to set apart Crown land for use by a band, an intent to create a reserve on the part of persons with the authority to bind the Crown, and practical steps by the Crown and the Indian band to realize that intent.
Reserve Creation in British Columbia
When British Columbia joined Confederation in 1871, Article 13 of the Terms of Union provided for the creation of reserves. Federal‑provincial cooperation was thus required because Crown lands from which reserves would be established were retained as provincial property yet the federal government had jurisdiction over Indians and lands reserved for Indians. The reserve‑creation process was completed in 1938 by virtue of B.C. Order‑in‑Council 1036 which transferred to the federal Crown administration and control of land on which the reserves were to be established. When the subject lands were transferred, the federal Crown intended to set apart each reserve for the beneficial use and occupation of the present incumbent. Each band accepted the status quo and made use of the reserves allocated to it.
The surrender provisions of the Indian Act did not apply to these pre‑1938 adjustments because (i) the resolution of a “difference of opinion” between sister bands of the same First Nation to which the land had been allocated in the first instance should not be characterized as a surrender, (ii) the lands were not Indian Reserves within the meaning of the Indian Act prior to 1938, and (iii) in any event the operation of the surrender provisions of the Indian Act had been suspended (to the extent they were capable of application) by Proclamation of the Privy Council made December 15, 1876.
Rectification of Orders in Council
The Federal Court purported to “rectify” the faulty Schedule to Order‑in‑Council 1036. Judicial correction of perceived errors in legislative enactments, in the rare instances where they can be justified, is performed on the basis that the corrected enactment expresses the intent of the enacting body. The clerical error is generally apparent on the face of the enactment itself. Here, however, the mistake was made at the federal level in the Department of Indian Affairs. It was noted but not corrected by the McKenna McBride Commission. The Schedules in their uncorrected form were attached by the provincial government to its Order‑in‑Council 1036. The permissible constitutional scope of the provincial “intent” in relation to “lands reserved for Indians” was limited to the size, number and location of reserves to be transferred by it to the administration and control of the Crown in right of Canada. The federal Order‑in‑Council has been interpreted, in practice, without regard to the “ditto mark error”. In these circumstances, rectification was not an appropriate remedy. The solution to these appeals does not lie in the law of rectification but in the law governing the fiduciary duty alleged and the equitable remedies sought by the appellant bands.
The Existence of a Fiduciary Duty
The existence of a public law duty does not exclude the possibility that the Crown undertook, in the discharge of that public law duty, obligations “in the nature of a private law duty” towards aboriginal peoples. A fiduciary duty, where it exists, is called into existence to facilitate supervision of the high degree of discretionary control gradually assumed by the Crown over the lives of aboriginal peoples.
However, even in the traditional trust context, not all obligations existing between the parties to a well‑recognized fiduciary relationship are themselves fiduciary in nature. Equally, not all fiduciary relationships and not all fiduciary obligations are the same. They are shaped by the demands of the situation. These observations are of particular importance in a case where the fiduciary is also the government.
The Content of the Fiduciary Duty
The content of the Crown’s fiduciary duty towards aboriginal peoples varies with the nature and importance of the interest to be protected. The appellants seemed at times to invoke the “fiduciary duty” as a source of plenary Crown liability covering all aspects of the Crown‑Indian band relationship. This overshoots the mark. The fiduciary duty imposed on the Crown does not exist at large but in relation to specific Indian interests. Fiduciary protection accorded to Crown dealings with aboriginal interests in land (including reserve creation) has not to date been recognized by this Court in relation to Indian interests other than land outside the framework of s. 35(1) of the Constitution Act, 1982 .
Prior to reserve creation, the Crown exercises a public law function under the Indian Act , which is subject to supervision by the courts exercising public law remedies. At that stage, a fiduciary relationship may also arise but, in that respect, the Crown’s duty is limited to the basic obligations of loyalty, good faith in the discharge of its mandate, providing full disclosure appropriate to the subject matter, and acting with ordinary prudence with a view to the best interest of the aboriginal beneficiaries. Once a reserve is created the Crown’s fiduciary duty expands to include the protection and preservation of the band’s quasi‑proprietary interest in the reserve from exploitation. The Crown must use diligence to protect a band’s legal interest from exploitative bargaining with third parties or from exploitation by the Crown itself.
When exercising ordinary government powers in matters involving disputes between Indians and non‑Indians, the Crown was (and is) obliged to have regard to the interest of all affected parties, not just the Indian interest. The Crown can be no ordinary fiduciary; it wears many hats and represents many interests, some of which cannot help but be conflicting.
Here, the federal Crown’s mandate was to create a new interest for the bands in lands not subject to treaty or aboriginal rights claims. The nature and importance of the appellant bands’ interest in these lands prior to 1938, and the Crown’s intervention as the exclusive intermediary to deal with others, including the province, on their behalf, imposed a fiduciary duty on the Crown but there is no persuasive reason to conclude that the obligations of loyalty, good faith and disclosure of relevant information were not fulfilled. After the creation of the reserve, the Crown did preserve and protect each band’s legal interest in its allocated reserve.
By the time the reserves creation process was completed in 1938, each of the appellant bands had formally abandoned the claim it now asserts to the other’s reserve. They had manifested on several occasions their acknowledgement that the beneficial interest in Reserve 11 resided in the Campbell River Band and the beneficial interest in Reserve 12 resided in the Cape Mudge Band. The Band leadership in those years, whose conduct is now complained of, were autonomous actors, apparently fully informed, who intended in good faith to resolve a “difference of opinion” with a sister band. They were not dealing with non‑Indian third parties. It is patronizing to suggest, on the basis of the evidentiary record, that they did not know what they were doing, or to reject their evaluation of a fair outcome.
Defences to Equitable Remedies
Enforcement of equitable duties by equitable remedies is subject to the usual equitable defences, including laches and acquiescence. Equitable remedies require equitable conduct by the claimant and are always subject to the discretion of the court.
Both branches of the doctrine of laches and acquiescence are applicable in this case: conduct equivalent to a waiver is found in the declarations, representations and failures to assert the alleged rights in circumstances that required assertion; and prosecution of the claim would, in each case, be unreasonable because each band relied on the status quo and improved its reserve under the understanding that the other band made no further claim. All of this was done with sufficient knowledge of the underlying facts relevant to a possible claim.
On the evidence, no fiduciary duty has been breached and no “equitable” remedy is available either to dispossess an incumbent band that is entitled to the beneficial interest, or to require the Crown to pay “equitable” compensation for its refusal to bring about such a wrongful dispossession.
Application of Limitation Periods
In any event, the appellant bands’ claims are barred by the expiry of the applicable limitation periods. Section 39(1) of the Federal Court Act incorporates by reference the applicable British Columbia limitation legislation. The Campbell River Band’s claim for possession of Reserve 12 was complete no later than in 1938 and was subject to a 20‑year limitations period under s. 16 of the 1897 B.C. Statute of Limitations. The Cape Mudge Band’s claim for possession of Reserve 11 arose when the Campbell River Band went into possession of that reserve prior to 1888 and was extinguished around the time the band signed the 1907 Resolution. Even if the running of the limitation periods was postponed due to a lack of pertinent information, all relevant facts were known to both bands when they made their declarations in 1936 and 1937. The limitation periods applicable to the claims for possession, therefore, expired no later than 1957.
As to breach of fiduciary duty, the 1897 Statute of Limitations, in force between 1897 and 1975, imposed no limitation on such claims. The transitional provisions of the 1975 Limitations Act therefore apply. By virtue of ss. 3(4) and 14(3) of the 1975 Act, the actions based on breach of fiduciary duty were barred as of July 1, 1977. In any case, the claims asserted in these proceedings were all caught by the 30‑year “ultimate limitation period” in s. 8 of the 1975 Act.
Cases Cited
Explained: Guerin v. The Queen, [1984] 2 S.C.R. 335; referred to: R. v. Van der Peet, [1996] 2 S.C.R. 507; Delgamuukw v. British Columbia, [1997] 3 S.C.R. 1010; Ross River Dena Council Band v. Canada, [2002] 2 S.C.R. 816, 2002 SCC 54; Ontario Mining Co. v. Seybold, [1903] A.C. 73; Dunstan v. Hell’s Gate Enterprises Ltd., [1986] 3 C.N.L.R. 47; St. Mary’s Indian Band v. Cranbrook (City), [1997] 2 S.C.R. 657; Blueberry River Indian Band v. Canada (Department of Indian Affairs and Northern Development), [1995] 4 S.C.R. 344; St. Catherine’s Milling and Lumber Co. v. The Queen (1888), 14 App. Cas. 46, aff’g (1887), 13 S.C.R. 577; Ontario Mining Co. v. Seybold (1899), 31 O.R. 386, aff’d (1900), 32 O.R. 301, aff’d (1901), 32 S.C.R. 1, aff’d [1903] A.C. 73; Morishita v. Richmond (Township) (1990), 67 D.L.R. (4th) 609; R. v. Liggetts‑Findlay Drug Stores Ltd., [1919] 3 W.W.R. 1025; Cameron v. The King, [1927] 2 D.L.R. 382; Morris v. Structural Steel Co. (1917), 35 D.L.R. 739; Rennie’s Car Sales & R. G. Hicks v. Union Acceptance Corp., [1955] 4 D.L.R. 822; St. Ann’s Island Shooting and Fishing Club Ltd. v. The King, [1950] S.C.R. 211; Calder v. Attorney-General of British Columbia, [1973] S.C.R. 313; Johnson v. M’Intosh, 21 U.S. (8 Wheat.) 543 (1823); Mitchell v. M.N.R., [2001] 1 S.C.R. 911, 2001 SCC 33; R. v. Sparrow, [1990] 1 S.C.R. 1075; Quebec (Attorney General) v. Canada (National Energy Board), [1994] 1 S.C.R. 159; R. v. Marshall, [1999] 3 S.C.R. 456; Lac Minerals Ltd. v. International Corona Resources Ltd., [1989] 2 S.C.R. 574; Hodgkinson v. Simms, [1994] 3 S.C.R. 377; Frame v. Smith, [1987] 2 S.C.R. 99; R. v. Taylor (1981), 34 O.R. (2d) 360, leave to appeal refused, [1981] 2 S.C.R. xi; Batchewana Indian Band (Non‑resident members) v. Batchewana Indian Band, [1997] 1 F.C. 689; Southeast Child & Family Services v. Canada (Attorney General), [1997] 9 W.W.R. 236; B.C. Native Women’s Society v. Canada, [2000] 1 F.C. 304; Paul v. Kingsclear Indian Band (1997), 137 F.T.R. 275; Mentuck v. Canada, [1986] 3 F.C. 249; Deer v. Mohawk Council of Kahnawake, [1991] 2 F.C. 18; Chippewas of the Nawash First Nation v. Canada (Minister of Indian and Northern Affairs) (1996), 116 F.T.R. 37, aff’d (1999), 251 N.R. 220; Montana Band of Indians v. Canada (Minister of Indian and Northern Affairs), [1989] 1 F.C. 143; Timiskaming Indian Band v. Canada (Minister of Indian and Northern Affairs) (1997), 132 F.T.R. 106; Ominayak v. Canada (Minister of Indian Affairs and Northern Development), [1987] 3 F.C. 174; Tuplin v. Canada (Indian and Northern Affairs) (2001), 207 Nfld. & P.E.I.R. 292; G. (A.P.) v. A. (K.H.) (1994), 120 D.L.R. (4th) 511; Lac La Ronge Indian Band v. Canada (2001), 206 D.L.R. (4th) 638; Cree Regional Authority v. Robinson, [1991] 4 C.N.L.R. 84; Tsawwassen Indian Band v. Canada (Minister of Finance) (1998), 145 F.T.R. 1; Westbank First Nation v. British Columbia (2000), 191 D.L.R. (4th) 180; McInerney v. MacDonald, [1992] 2 S.C.R. 138; R. v. Neil, [2002] 3 S.C.R. 631, 2002 SCC 70; Fales v. Canada Permanent Trust Co., [1977] 2 S.C.R. 302; Samson Indian Nation and Band v. Canada, [1995] 2 F.C. 762; Osoyoos Indian Band v. Oliver (Town), [2001] 3 S.C.R. 746, 2001 SCC 85; Kruger v. The Queen, [1986] 1 F.C. 3; R. v. Lewis, [1996] 1 S.C.R. 921; Mitchell v. Peguis Indian Band, [1990] 2 S.C.R. 85; Canson Enterprises Ltd. v. Boughton & Co., [1991] 3 S.C.R. 534; Performance Industries Ltd. v. Sylvan Lake Golf & Tennis Club Ltd., [2002] 1 S.C.R. 678, 2002 SCC 19; M. (K.) v. M. (H.), [1992] 3 S.C.R. 6; Lindsay Petroleum Co. v. Hurd (1874), L.R. 5 P.C. 221; Harris v. Lindeborg, [1931] S.C.R. 235; Canada Trust Co. v. Lloyd, [1968] S.C.R. 300; Blundon v. Storm, [1972] S.C.R. 135; L’Hirondelle v. The King (1916), 16 Ex. C.R. 193; Ontario (Attorney General) v. Bear Island Foundation (1984), 49 O.R. (2d) 353, aff’d on other grounds (1989), 68 O.R. (2d) 394, aff’d [1991] 2 S.C.R. 570; Chippewas of Sarnia Band v. Canada (Attorney General) (2000), 51 O.R. (3d) 641; Smith v. The Queen, [1983] 1 S.C.R. 554; Canadian Pacific Ltd. v. Paul, [1988] 2 S.C.R. 654; Coughlin v. Ontario Highway Transport Board, [1968] S.C.R. 569; Attorney General for Ontario v. Scott, [1956] S.C.R. 137; Novak v. Bond, [1999] 1 S.C.R. 808; Peixeiro v. Haberman, [1997] 3 S.C.R. 549; Zakrzewski v. The King, [1944] 4 D.L.R. 281; Parmenter v. The Queen, [1956‑60] Ex. C.R. 66; Bera v. Marr (1986), 1 B.C.L.R. (2d) 1; Mathias v. Canada (2001), 207 F.T.R. 1, 2001 FCT 480; Semiahmoo Indian Band v. Canada, [1998] 1 F.C. 3; Costigan v. Ruzicka (1984), 13 D.L.R. (4th) 368; Lower Kootenay Indian Band v. Canada (1991), 42 F.T.R. 241; Fairford First Nation v. Canada (Attorney General), [1999] 2 F.C. 48.
Statutes and Regulations Cited
British Columbia Indian Lands Settlement Act, S.C. 1920, c. 51 .
British Columbia Order‑in‑Council No. 911, July 26, 1923.
British Columbia Order‑in‑Council No. 1036, July 29, 1938.
British Columbia Order‑in‑Council No. 1334.
British Columbia Terms of Union, R.S.C. 1985, App. II, No. 10, Art. 13.
Constitution Act, 1867, s. 91(24) .
Constitution Act, 1982, s. 35(1) .
Exchequer Court Act, R.S.C. 1952, c. 98, s. 31.
Federal Court Act, R.S.C. 1985, c. F‑7, s. 39(1) .
Federal Court Act , S.C. 1970‑71‑72, c. 1 [reproduced in R.S.C. 1970 (2nd Supp.), c. 10], s. 38(1).
Federal Real Property Act, S.C. 1991, c. 50, ss. 2 “federal real property”, 13, 14.
Indian Act, R.S.C. 1985, c. I‑5, s. 2(1) “reserve”.
Indian Act, 1876, S.C. 1876, c. 18, s. 3(6).
Indian Affairs Settlement Act, S.B.C. 1919, c. 32.
Limitation Act, R.S.B.C. 1979, c. 236, ss. 2, 14(1).
Limitations Act, S.B.C. 1975, c. 37, ss. 3(4), 8, 9, 14(3).
Order‑in‑Council P.C. 1088, November 10, 1875.
Order‑in‑Council P.C. 1265, July 19, 1924.
Royal Proclamation, 1763, R.S.C. 1985, App. II, No. 1.
Statute of Limitations, R.S.B.C. 1897, c. 123, ss. 16, 39.
Authors Cited
British Columbia. Law Reform Commission of British Columbia. Report on the Ultimate Limitation Period: Limitation Act, Section 8. Vancouver: The Commission, 1990.
La Forest, Gerard V. Natural Resources and Public Property under the Canadian Constitution. Toronto: University of Toronto Press, 1969.
Maxwell on the Interpretation of Statutes, 4th ed. by J. Anwyl Theobald. Toronto: Carswell, 1905.
McMurtry, William R., and Alan Pratt. “Indians and the Fiduciary Concept, Self‑Government and the Constitution: Guerin in Perspective”, [1986] 3 C.N.L.R. 19.
Proclamation of the Privy Council, December 15, 1876, The Canada Gazette, December 30, 1876, vol. X, No. 27.
Slattery, Brian. “Understanding Aboriginal Rights” (1987), 66 Can. Bar Rev. 727.
Sullivan, Ruth. Statutory Interpretation. Concord, Ont.: Irwin Law, 1997.
Waters, D. W. M. Law of Trusts in Canada, 2nd ed. Toronto: Carswell, 1984.
Weinrib, Ernest J. “The Fiduciary Obligation” (1975), 25 U.T.L.J. 1.
APPEALS from a judgment of the Federal Court of Appeal, [2000] 3 C.N.L.R. 303, 247 N.R. 350, 27 R.P.R. (3d) 157, [1999] F.C.J. No. 1529 (QL), affirming a decision of the Trial Division (1995), 99 F.T.R. 1, [1995] F.C.J. No. 1202 (QL). Appeals dismissed.
Michael P. Carroll, Q.C., Malcolm Maclean, Emmet J. Duncan and Monika B. Gehlen, for the appellants Roy Anthony Roberts et al.
John D. McAlpine, Q.C., and Allan Donovan, for the respondents/appellants Ralph Dick et al.
J. Raymond Pollard, Mitchell R. Taylor and Georg Daniel Reuter, for the respondent Her Majesty the Queen.
E. Ria Tzimas and J. T. S. McCabe, Q.C., for the intervener the Attorney General for Ontario.
Patrick G. Foy, Q.C., and Richard J. M. Fyfe, for the intervener the Attorney General of British Columbia.
Peter R. Grant and David Schulze, for the interveners the Gitanmaax Indian Band, the Kispiox Indian Band and the Glen Vowell Indian Band.
The judgment of the Court was delivered by
1 Binnie J. — Two Indian bands on the east coast of Vancouver Island lay claim to each other’s reserve land. The reserves, which have been in the possession of the incumbent band since about the end of the 19th century, are located two miles from each other. The inhabitants of both reserves are members of the Laich-kwil-tach First Nation which, in the mid-1800s, managed to displace the Comox First Nation from this area of British Columbia.
2 Each band claims that but for various breaches of fiduciary duty on the part of the federal Crown, its people would be in possession of both reserves. Members of the other band, on this view, should be in possession of neither.
3 There is no assertion of any entitlement in these lands under s. 35(1) of the Constitution Act, 1982 (“existing aboriginal and treaty rights”).
4 Although the bands seek formal declarations of trespass and possession and injunctive relief against each other, each acknowledges the hardship that such a result would cause the other, and each band therefore says it would be satisfied with financial compensation from the federal Crown. The Cape Mudge appellants say their compensation should be in the range of $12.2 to $14.8 million for Reserve No. 11 and the Campbell River appellants say their claim is about $4 million for Reserve No. 12. In short, if the appellant bands’ claims are allowed, each band will stay where it is but will receive substantial funds by way of “equitable compensation” plus costs on a solicitor-client scale.
5 We are therefore required to consider (i) the scope of the fiduciary duty of the Crown in the process of the creation of Indian reserve lands; (ii) whether the acts of government officials in this case breached any fiduciary duty; and (iii) what equitable remedies (including equitable compensation) are available to remedy such breaches, if any.
6 It is clear that neither of the bands is guilty of any wrongdoing towards the other. These are paper claims, based on dissecting the performance of the Department of Indian Affairs in its sometimes awkward attempts to establish reserves to accord with late 19th century patterns of Indian occupation on the west coast. The appellant bands rely on disputed inferences from contradictory records respecting which band was entitled to what, and when its entitlement arose. It is apparent that there were occasional gaps of understanding between what was happening on Vancouver Island and what appeared to be happening in the government records in Ottawa. That said, the trial judge, after 80 days of evidence and submissions, concluded that the Crown had acted fairly and honourably. The wishes of the Indians themselves had been sought out and respected.
7 As will be seen, by the time the reserves-creation process was completed by provincial Order-in-Council 1036 dated July 29, 1938, each of the appellant bands had formally abandoned the claim it now asserts to the other’s reserve. Over the intervening 60 or more years, band members have relied on the status quo to make improvements to the reserves on which they reside. In these circumstances, in my view, no fiduciary duty has been breached and no “equitable” relief is available either by way of injunction or equitable compensation. In any event, all such claims would have been barred by the expiry of the applicable limitation periods.
8 I would therefore dismiss both appeals with costs.
Facts and Analysis
9 The Laich-kwil-tach First Nation, comprising four different bands, is itself part of a larger group of Indians who speak the Kwakwala language. They inhabit parts of the east coast of Vancouver Island, parts of the west coast of the mainland, and some of the offshore islands in between. Their livelihood and much of their culture was traditionally based on fishing the rich waters of what we now call the Straits of Georgia.
10 Unlike the historical disputes that reached back to time immemorial in such cases as R. v. Van der Peet, [1996] 2 S.C.R. 507, and Delgamuukw v. British Columbia, [1997] 3 S.C.R. 1010, the epicentre of these appeals lies in the late 19th and early 20th century paperwork of the Department of Indian Affairs and the records collected since then by the contending bands. The resulting bureaucratic paper trail is outlined comprehensively in the careful 275-page trial judgment of Teitelbaum J.: (1995), 99 F.T.R. 1. His findings of fact were not successfully challenged before the Federal Court of Appeal: (1999), 247 N.R. 350. I will deal only with those facts essential for an understanding of the legal issues that we are required to resolve.
11 The contending bands are the Cape Mudge Indian Band (traditionally known as the “Wewaikai”) some of whom live on Reserve No. 12, and the Campbell River Indian Band (traditionally known as the “Wewaykum”) some of whom live on Reserve No. 11. Each band also has reserves elsewhere. The reserves in dispute are quite small. Reserve 11, located at the mouth of the Campbell River, has about 350 acres and 120 inhabitants. Reserve No. 12, located inland on a tributary of the Campbell River, has less than 300 acres and fewer inhabitants. The multiplicity of relatively small reserves is characteristic of coastal British Columbia, where strategic access to plentiful fishing and other resources was thought to be more important than simple acreage.
12 It appears the first members of the Laich-kwil-tach First Nation to take up residence in the disputed area was Captain John Quacksister (or Kwaksistal) and his family, in or about 1875.
A. Creation of Reserve Lands
13 The legal requirements for the creation of a reserve within the meaning of the Indian Act were considered by this Court in Ross River Dena Council Band v. Canada, [2002] 2 S.C.R. 816, 2002 SCC 54, released June 20, 2002. They include an act by the Crown to set apart Crown land for use of an Indian band combined with an intention to create a reserve on the part of persons having authority to bind the Crown and practical steps by the Crown and the Indian band to realize that intent (para. 67). In that case it was found that the Crown never intended to establish a reserve within the meaning of the Act. At para. 68, LeBel J. noted “that the process of reserve creation, like other aspects of its relationship with First Nations, requires that the Crown remain mindful of its fiduciary duties and of their impact on this procedure, and taking into consideration the sui generis nature of native land rights”. The role of the Crown’s fiduciary duty in reserve creation was not argued in that case. It is squarely raised in the appeals now before us.
B. Reserve Creation in British Columbia
14 When British Columbia joined Confederation in 1871, Article 13 of the British Columbia Terms of Union, R.S.C. 1985, App. II, No. 10, provided:
The charge of the Indians, and the trusteeship and management of the lands reserved for their use and benefit, shall be assumed by the Dominion Government, and a policy as liberal as that hitherto pursued by the British Columbia Government shall be continued by the Dominion Government after the Union.
To carry out such policy, tracts of land of such extent as it has hitherto been the practice of the British Columbia Government to appropriate for that purpose, shall from time to time be conveyed by the Local Government to the Dominion Government in trust for the use and benefit of the Indians on application of the Dominion Government; and in case of disagreement between the two Governments respecting the quantity of such tracts of land to be so granted, the matter shall be referred for the decision of the Secretary of State for the Colonies. [Emphasis added.]
15 Federal-provincial cooperation was required in the reserve-creation process because, while the federal government had jurisdiction over “Indians, and Lands reserved for the Indians” under s. 91(24) of the Constitution Act, 1867 , Crown lands in British Columbia, on which any reserve would have to be established, were retained as provincial property. Any unilateral attempt by the federal government to establish a reserve on the public lands of the province would be invalid: Ontario Mining Co. v. Seybold, [1903] A.C. 73 (P.C.). Equally, the province had no jurisdiction to establish an Indian reserve within the meaning of the Indian Act , as to do so would invade exclusive federal jurisdiction over “Indians, and Lands reserved for the Indians”.
16 Implementation of Article 13 therefore required a number of stages preliminary to the federal reserve-creation process described in Ross River. First of all, federally appointed Indian Reserve Commissioners undertook to define and survey the proposed reserves. Then the federal government and the provincial government, armed with the surveys, negotiated the size, location and number of reserves. Administration and control of such lands had then to be transferred (“conveyed” is the word used in Article 13) from the new Province of British Columbia to the federal government. The federal government would have to “set apart” the lands for the use and benefit of a band: The Indian Act, 1876, S.C. 1876, c. 18, s. 3(6); Indian Act, R.S.C. 1985, c. I-5, s. 2(1) “reserve”.
17 For more than 60 years after the entry of British Columbia into Confederation, the reserve establishment issue remained an on-going source of friction between the federal and provincial governments. The trial judge found, for instance, that the British Columbia government initially considered the federal government’s target of 80 acres per capita for reserve lands to be excessive. The provincial position was that a per capita allocation of 20 acres was sufficient, particularly where the principal source of livelihood of a band was fishing. There was even disagreement as to the mechanism to accomplish the “conveyance”.
18 The issues were ultimately resolved by federal-provincial agreement and the transfer in 1938 of administration and control to the federal Crown of provincial land on which the reserves were to be established: G. V. La Forest, Natural Resources and Public Property under the Canadian Constitution (1969), at p. 132. Until then, “[a]ll rested in the realm of bureaucratic recommendation and political intention with nothing conclusive accomplished in any effective legal sense”: Dunstan v. Hell’s Gate Enterprises Ltd., [1986] 3 C.N.L.R. 47 (B.C.S.C.), per Cumming J., at p. 65.
19 I think there is no doubt on the evidence that when the federal Crown received the B.C. Order-in-Council 1036 dated July 29, 1938, it intended to set apart each of the contested reserves for the beneficial use and occupation of the present incumbent. The claim of each appellant band to both reserves is misconceived.
C. The Indian Reserve Commission (1875-1912)
20 In 1875, the federal government and the Province of British Columbia established the Indian Reserve Commission whose mandate was in part to
. . . make arrangements to visit, with all convenient speed, in such order as may be found desirable, each Indian Nation (meaning by Nation all Indian tribes speaking the same language) in British Columbia and after full enquiry on the spot, into all matters affecting the question, to fix and determine for each Nation separately the number, extent and locality of the Reserve or Reserves to be allowed to it. [Emphasis added.]
(Order-in-Council P.C. 1088, November 10, 1875)
21 The mandate of the Indian Reserve Commission was thus to allocate reserves at the level of First Nation, as distinct from subgroupings at the band level. (Arguably, the Commission was required only to allocate reserves at the higher level of Kwakwala-speaking peoples, of which the Laich-kwil-tach grouping was a sub-component, but in practice the Laich-kwil-tach people were dealt with as a First Nation.) The reason for this high level allocation, as found by the trial judge at para. 25, was to secure land quickly for the Indians “before white settlement alienated all the desired locations”. Long and complex inquiries by the Commissioners into individual sub-First Nation allocations would have created unacceptable delay. The band level allocation was thus generally to be left to the local Indian agent, a federal official, who possessed the requisite detailed knowledge. The Campbell River Band argues that this view elevates the Indian Agent to the status of a “latter day Solomon with plenary authority to re-allocate reserves”, but this is not so. The Indian Agents were the eyes and ears of the senior officials whose ultimate stamp of approval was essential.
22 In the 1870s, Commissioner Gilbert Sproat, who by then had become the sole member of the Indian Reserve Commission, surveyed a number of reserves in the area in question for the Laich-kwil-tach First Nation. His survey of a proposed reserve was not enough to create a reserve within the meaning of the Indian Act but, if approved by the provincial government, the effect was to withdraw the subject lands from other inconsistent uses, such as preemption by settlers. It thus created a measure of what might be termed administrative protection, but this fell well short of the various statutory protections under the federal Indian Act .
23 The reserves surveyed by Commissioner Sproat were not approved by the province in any event.
24 In 1886, Sproat’s successor, P. O’Reilly, a former county court judge, recommended the allotment of 10 reserves to the “‘Laich kwil tach’ (Euclataw) Indians”, but he did not deal with the lands now in dispute because “as the Indians were all absent, I deemed it advisable to delay making reserves until they are present to point out the places they wish to have” (emphasis added). A policy of non-intervention in the status quo had been made explicit in O’Reilly’s mandate from Ottawa:
You should in making allotments of lands for Reserves make no attempt to cause any violent or sudden changes in the habits of the Indian band for which you may be setting apart the Reserve land; or to divert the Indians from any legitimate pursuits or occupations which they may be profitably following or engaged in, you should on the contrary encourage them in any branch of industry which you find them so engaged. [Emphasis in original.]
D. The Ashdown Green Survey
25 Delay in the setting aside of reserves did in fact exacerbate the potential for conflict between Indians and the influx of settlers. In 1888, a dispute flared up at Campbell River between some homesteaders called Nunns and the resident Laich-kwil-tach Indians, each of whom claimed rights to some valuable timber in the vicinity of what is now Reserve No. 11. The most vocal figure in this dispute, at least on the Indian side, was Captain John Quacksister. He claimed that he had been granted ownership of all of the lands which Commissioner Sproat had provisionally set aside at Campbell River in 1879. He was likely not aware of the federal-provincial intricacies of land transfer. Captain John’s band affiliation was the subject of dispute between the parties. The trial judge concluded, at para. 289:
Men and women passed from one group to another and clearly a person could be a member of more than one subgro