Samson First Nation v. Canada

Samson First Nation v. Canada
Court (s) Database
Federal Court Decisions
Date
2015-07-09
Neutral citation
2015 FC 836
File numbers
T-1254-92, T-2022-89
Notes
A correction was made on July 7, 2016
Decision Content
Date: 20150709
Dockets: T-2022-89
T-1254-92
Citation: 2015 FC 836
Ottawa, Ontario, July 9, 2015
PRESENT: The Honourable Mr. Justice Russell
Docket: T-2022-89
BETWEEN:
CHIEF VICTOR BUFFALO ACTING ON HIS OWN BEHALF AND ON BEHALF OF ALL THE OTHER MEMBERS OF THE SAMSON INDIAN NATION AND BAND, AND THE SAMSON INDIAN BAND AND NATION
Respondents
(Plaintiffs)
and
HER MAJESTY THE QUEEN IN RIGHT OF CANADA, THE MINISTER OF INDIAN AFFAIRS AND NORTHERN DEVELOPMENT, AND THE MINISTER OF FINANCE
Applicants
(Defendants)
Docket: T-1254-92
AND BETWEEN:
CHIEF JOHN ERMINESKIN, LAWRENCE WILDCAT, GORDON LEE, ART LITTLECHILD, MAURICE WOLFE, CURTIS ERMINESKIN, GERRY ERMINESKIN, EARL ERMINESKIN, RICK WOLFE, KEN CUTARM, BRIAN LEE, LESTER FRAYNN, THE ELECTED CHIEF AND COUNCILORS OF THE ERMINESKIN INDIAN BAND AND NATION SUING ON THEIR OWN BEHALF AND ON BEHALFOF ALL THE OTHER MEMBERS OF THEERMINESKIN INDIAN BAND AND NATION
Respondents
(Plaintiffs)
and
HER MAJESTY THE QUEEN IN RIGHT OF CANADA, THE MINISTER OF INDIAN AFFAIRS AND NORTHERN DEVELOPMENT, AND THE MINISTER OF FINANCE
Applicants
(Defendants)
JUDGMENT AND REASONS
I. INTRODUCTION.. 3
II. BACKGROUND.. 3
III. ISSUES. 6
IV. STATUTORY PROVISIONS. 6
V. ARGUMENT. 12
A. Canada. 12
B. Samson Plaintiffs. 18
C. Ermineskin Plaintiffs. 25
D. Canada’s Reply Submissions. 31
E. Intervener - Alberta. 33
F. Samson Plaintiffs’ Reply to Intervener 35
G. Ermineskin Plaintiffs’ Reply to Intervener 36
VI. ANALYSIS. 38
A. The Actions. 39
B. The Merits of the Claims. 40
C. Summary Judgment 40
(1) Canada’s Position. 46
(2) T-2022-89 – Samson’s Position. 48
(a) No Constitutionally Enacted Limitation Period. 48
(b) The Characterization Issue. 64
(c) The Applicable Jurisdiction. 69
(d) Relevant Alberta Limitation Period. 72
(e) The Terminus a Quo. 80
(f) Suitability for Summary Judgment 93
(3) T-1254-92 – Ermineskin’s Position. 98
(a) No Constitutionally Enacted Limitation Period. 98
(b) No Previous Case. 101
(c) Section 39 Prima Facie Infringes Ermineskin’s Treaty Rights. 105
(d) The Honour of the Crown. 107
(e) Historical Grievances Should Not Be Ignored. 108
(f) The Fundamental Conflict 110
(g) Infringement Not Justified. 111
(h) The Characterization Issue. 112
(i) Taking in Kind. 114
(j) Legal and Practical Impediments. 122
(k) Equitable Fraud. 124
(4) Laches and Acquiescence. 126
I. INTRODUCTION [1] These are two motions for summary judgment. The Defendants (Applicants) [Canada] bring the same motion in actions T-2022-89 and T-1254-92 under Rule 213(1) of the Federal Courts Rules, SOR/98-106. Canada asks for summary judgment on the basis that the Plaintiffs’ claims in both actions are time-barred. Due to the similarities in the factual background, the nature of the broader litigation of which these motions are a part, and the submissions before the Court, one set of reasons will be provided and filed in both T-2022-89 and T-1254-92. The Plaintiffs (Respondents) in action T-2022-89 will be referred to as the “Samson Plaintiffs” or “Samson,” and the Plaintiffs (Respondents) in action T-1254-92 will be referred to as the “Ermineskin Plaintiffs” or “Ermineskin.” Collectively, the Samson Plaintiffs and the Ermineskin Plaintiffs will be referred to as the Plaintiffs.
II. BACKGROUND [2] These motions are brought in the context of ongoing litigation concerning oil royalties and taxes levied on oil produced on the Pigeon Lake Reserve [Reserve] between 1973 and 1985. Samson and Ermineskin are two of the four First Nations with interests in the Reserve [collectively, “Four Bands”], and are both parties to Treaty No. 6.
[3] In 1946, Samson and Ermineskin surrendered their mineral interests in the Reserve to Canada [Surrender]. The Surrender allowed Canada to grant leases to oil and gas companies who paid royalties to Canada on behalf of Samson and Ermineskin.
[4] In January 1974, the Oil Export Tax Act, SC 1973-74, c 53 received royal assent with retroactive effect to October 1, 1973. The Oil Export Tax Act was part of a national strategy to ameliorate the domestic effects of rapidly rising international oil prices. The Oil Export Tax Act created a “made-in-Canada” oil price and imposed a tax on oil exports. The revenue from the export tax was intended to subsidize the cost of oil imports and the cost of Canadian oil production.
[5] The Oil Export Tax Act was replaced with the Petroleum Administration Act, SC 1974-75-76, c 47 which imposed an oil export charge and had retroactive effect to April 1, 1974. The cumulative effect of the Oil Export Tax Act and the Petroleum Administration Act was that oil exports were subject to a tax or charge from October 1, 1973 to June 1, 1985. The “made-in-Canada” oil price program constituted by the Oil Export Tax Act and the Petroleum Administration Act will be referred to as the “Program.”
[6] The oil produced from the Reserve was subject to the price restrictions and export tax and charge. The funds received were deposited into the Consolidated Revenue Fund [CRF] with notional accounts kept to distinguish the amounts belonging to Samson and Ermineskin.
[7] The broader litigation raises issues of the amount of royalties collected, the amount that should or could have been collected, and the amounts properly credited to Samson and Ermineskin.
[8] The Samson Plaintiffs filed their Statement of Claim on September 29, 1989. They claim, inter alia, that Canada breached its trust, fiduciary, treaty and other obligations in failing to give full and proper effect to their constitutionally-protected royalty interests in the oil and gas produced on the Reserve and sold by the lessees. They claim that Canada improperly credited their royalties based on the “made-in-Canada” price, and seek a crediting to their CRF account of the royalty on the actual sales price of the exported oil. They also claim Canada has unjustly enriched itself by appropriating the difference between the domestic and international oil prices.
[9] The Ermineskin Plaintiffs filed their Statement of Claim on May 28, 1992. They claim Canada breached its trust and fiduciary duties by levying taxes on Ermineskin’s royalty interests contrary to s 87 of the Indian Act, RSC 1985, c I-5 and by appropriating the difference between the domestic and international oil prices.
[10] Canada says these claims are barred by both statutory and equitable limitation periods.
[11] The Samson Plaintiffs filed a Notice of Constitutional Questions on May 25, 2000, and the Ermineskin Plaintiffs filed a Notice of Constitutional Questions on November 2, 2004. Consequently, the Attorney General of Alberta [Intervener] intervenes in this motion as of right in accordance with s 57 of the Federal Courts Act, RSC 1985, c F-7.
III. ISSUES [12] Canada says there is no genuine issue to be tried with respect to the following:
1) Whether the Plaintiffs’ claims are statute-barred because:
a. The Plaintiffs knew of the facts giving rise to their claims more than six years prior to filing their Statements of Claim on September 29, 1989 and May 28, 1992; and,
b. The applicable limitation period under the Federal Courts Act is six years, whether by referential incorporation of the Alberta legislation pursuant to s 39(1), or alternatively under s 39(2); and,
2) Whether the Plaintiffs’ claims are barred by the equitable doctrines of laches and acquiescence.
[13] In their response to these motions, the Plaintiffs also raise a variety of issues that will be dealt with as part of the Court’s analysis.
IV. STATUTORY PROVISIONS
[14] The following provisions of Federal Courts Rules are applicable in this proceeding:
Summary Judgment and Summary Trial
Jugement et procès sommaires
Motion and Service
Requête et signification
Motion by a party
Requête d’une partie
213. (1) A party may bring a motion for summary judgment or summary trial on all or some of the issues raised in the pleadings at any time after the defendant has filed a defence but before the time and place for trial have been fixed.
213. (1) Une partie peut présenter une requête en jugement sommaire ou en procès sommaire à l’égard de toutes ou d’une partie des questions que soulèvent les actes de procédure. Le cas échéant, elle la présente après le dépôt de la défense du défendeur et avant que les heure, date et lieu de l’instruction soient fixés.
Further motion
Nouvelle requête
(2) If a party brings a motion for summary judgment or summary trial, the party may not bring a further motion for either summary judgment or summary trial except with leave of the Court.
(2) Si une partie présente l’une de ces requêtes en jugement sommaire ou en procès sommaire, elle ne peut présenter de nouveau l’une ou l’autre de ces requêtes à moins d’obtenir l’autorisation de la Cour.
Obligations of moving party
Obligations du requérant
(3) A motion for summary judgment or summary trial in an action may be brought by serving and filing a notice of motion and motion record at least 20 days before the day set out in the notice for the hearing of the motion.
(3) La requête en jugement sommaire ou en procès sommaire dans une action est présentée par signification et dépôt d’un avis de requête et d’un dossier de requête au moins vingt jours avant la date de l’audition de la requête indiquée dans l’avis.
Obligations of responding party
Obligations de l’autre partie
(4) A party served with a motion for summary judgment or summary trial shall serve and file a respondent’s motion record not later than 10 days before the day set out in the notice of motion for the hearing of the motion.
(4) La partie qui reçoit signification de la requête signifie et dépose un dossier de réponse au moins dix jours avant la date de l’audition de la requête indiquée dans l’avis de requête.
Facts and evidence required
Faits et éléments de preuve nécessaires
214. A response to a motion for summary judgment shall not rely on what might be adduced as evidence at a later stage in the proceedings. It must set out specific facts and adduce the evidence showing that there is a genuine issue for trial.
214. La réponse à une requête en jugement sommaire ne peut être fondée sur un élément qui pourrait être produit ultérieurement en preuve dans l’instance. Elle doit énoncer les faits précis et produire les éléments de preuve démontrant l’existence d’une véritable question litigieuse.
If no genuine issue for trial
Absence de véritable question litigieuse
215. (1) If on a motion for summary judgment the Court is satisfied that there is no genuine issue for trial with respect to a claim or defence, the Court shall grant summary judgment accordingly.
215. (1) Si, par suite d’une requête en jugement sommaire, la Cour est convaincue qu’il n’existe pas de véritable question litigieuse quant à une déclaration ou à une défense, elle rend un jugement sommaire en conséquence.
Genuine issue of amount or question of law
Somme d’argent ou point de droit
(2) If the Court is satisfied that the only genuine issue is
(2) Si la Cour est convaincue que la seule véritable question litigieuse est :
[…]
[…]
(b) a question of law, the Court may determine the question and grant summary judgment accordingly.
b) un point de droit, elle peut statuer sur celui-ci et rendre un jugement sommaire en conséquence.
Powers of Court
Pouvoirs de la Cour
(3) If the Court is satisfied that there is a genuine issue of fact or law for trial with respect to a claim or a defence, the Court may
(3) Si la Cour est convaincue qu’il existe une véritable question de fait ou de droit litigieuse à l’égard d’une déclaration ou d’une défense, elle peut :
(a) nevertheless determine that issue by way of summary trial and make any order necessary for the conduct of the summary trial; or
a) néanmoins trancher cette question par voie de procès sommaire et rendre toute ordonnance nécessaire pour le déroulement de ce procès;
(b) dismiss the motion in whole or in part and order that the action, or the issues in the action not disposed of by summary judgment, proceed to trial or that the action be conducted as a specially managed proceeding.
b) rejeter la requête en tout ou en partie et ordonner que l’action ou toute question litigieuse non tranchée par jugement sommaire soit instruite ou que l’action se poursuive à titre d’instance à gestion spéciale.
[15] The following provisions of the Federal Courts Act are applicable in this proceeding:
Prescription and limitation on proceedings
Prescription — Fait survenu dans une province
39. (1) Except as expressly provided by any other Act, the laws relating to prescription and the limitation of actions in force in a province between subject and subject apply to any proceedings in the Federal Court of Appeal or the Federal Court in respect of any cause of action arising in that province.
39. (1) Sauf disposition contraire d’une autre loi, les règles de droit en matière de prescription qui, dans une province, régissent les rapports entre particuliers s’appliquent à toute instance devant la Cour d’appel fédérale ou la Cour fédérale dont le fait générateur est survenu dans cette province.
Prescription and limitation on proceedings in the Court, not in province
Prescription — Fait non survenu dans la province
(2) A proceeding in the Federal Court of Appeal or the Federal Court in respect of a cause of action arising otherwise than in a province shall be taken within six years after the cause of action arose.
(2) Le délai de prescription est de six ans à compter du fait générateur lorsque celui-ci n’est pas survenu dans une province.
[16] The following provisions of the Limitation of Actions Act, RSA 1980, c L-15 [LAA] are applicable in this proceeding:
LIMITATION PERIODS
4(1) The following actions shall be commenced within and not after the time respectively hereinafter mentioned:
[…]
(c) actions
(i) for the recovery of money, other than a debt charged on land, whether recoverable as a debt or damages or otherwise, and whether on a recognizance, bond, covenant or other specialty or on a simple contract, express or implied, or
(ii) for an account or for not accounting,
within 6 years after the cause of action arose;
(e) actions grounded on accident, mistake or other equitable ground of relief not hereinbefore specifically dealt with, within 6 years from the discovery of the cause of action;
(g) any other action not in this Act or any other Act specifically provided for, within 6 years after the cause of action therein arose.
[…]
6 When the existence of a cause of action has been concealed by the fraud of the person setting up this Part or Part 2 as a defence, the cause of action shall be deemed to have arisen when the fraud was first known or discovered.
[…]
TRUSTS AND TRUSTEES
40 Subject to the other provisions of this Part, no claim of a cestui que trust against his trustee for any property held on an express trust, or in respect of a breach of the trust, shall be held to be barred by this Act.
41(1) In this section, “trustee” includes an executor, an administrator, and a trustee whose trust arises by construction or implication of law as well as an express trustee, and also includes a joint trustee.
(2) In an action against a trustee or a person claiming through him,
(a) rights and privileges conferred by this Act shall be enjoyed in the like manner and to the like extent as they would have been enjoyed in the action if the trustee or person claiming through him had not been a trustee or person claiming through a trustee and
(b) if the action is brought to recover money or other property and is one to which no limitation provision of this Act applies, the trustee or person claiming through him is entitled to the benefit of and is at liberty to plead the lapse of time as a bar to the action in the like manner and to the same extent as if the claim had been against him in an action for money had and received, except when the claim is founded on a fraud or fraudulent breach of trust to which the trustee was a party or privy, or is to recover trust property or the proceeds thereof still retained by the trustee, or previously received by the trustee and converted to his use.
(3) Notwithstanding subsection (2), the limitation provisions in this Act do not begin to run against a beneficiary unless and until the interest of the beneficiary becomes an interest in possession.
[17] The following provisions of the Judicature Act, RSA 1980, c J 1 are applicable in this proceeding:
14 No claim of a cestui que trust against his trustee for any property held on an express trust or in respect of a breach of the trust shall be held to be barred by a Statute of Limitations.
V. ARGUMENT A. Canada [18] Canada says that summary judgment is granted when the Court determines there is “no genuine issue for trial”: Federal Courts Rules, Rule 215. Rule 215 seeks to avoid the costs associated with allowing unmeritorious claims to proceed to trial: Canada (Attorney General) v Lameman, 2008 SCC 14 at para 10 [Lameman SCC]. The applicant has the onus of showing there is no genuine issue for trial. If the applicant discharges its burden, the respondent must refute or counter the applicant’s evidence or risk summary dismissal: Federal Courts Rules, Rule 214; Lameman SCC, above, at para 11.
[19] On a motion for summary judgment, the Court may make inferences of fact based on the evidence before it: Lameman SCC, above, at para 11; Papaschase Indian Band (Descendants of) v Canada (Attorney General), 2004 ABQB 655 at paras 60-61 [Lameman ABQB]. In these actions, the record clearly establishes that the Plaintiffs had the requisite knowledge of their claims long before any limitation periods expired. Their claims ought to be determined by summary judgment because they are large and complex claims which are doomed to fail.
[20] Legal proceedings must be commenced on a timely basis: Abbott v Canada, 2005 FC 163, aff’d 2006 FCA 342, leave to appeal to SCC refused, 31816 (May 10, 2007) [Abbott]; Abbott v Canada, 2007 FC 1338 at paras 11-13; Tacan v Canada, 2005 FC 385 at paras 78-85 [Tacan]; Canada (Fisheries and Oceans) v Perrot, 2009 NLTD 172 at paras 27-40. The Plaintiffs knew the material facts for the purposes of these claims from the inception of the Program. The Plaintiffs chose to pursue political solutions to their grievances, but this did not postpone the running of the relevant limitation period.
[21] There is no merit to the Plaintiffs’ constitutional claims regarding s 39 of the Federal Courts Act. Aboriginal claims are not constitutionally immune from the operation of limitation periods: Lameman SCC, above; Wewaykum Indian Band v Canada, 2002 SCC 79 [Wewaykum]; Blueberry River Indian Band v Canada (Department of Indian Affairs and Northern Development), [1995] 4 SCR 344 at paras 106-122 [Blueberry River]; Kruger v The Queen (1985), [1986] 1 FC 3 at 54-56 (CA) [Kruger]. Limitation periods do not extinguish constitutionally-protected Aboriginal and treaty rights. They simply impose time limits on the commencement of legal proceedings. This merely bars the pursuit of a remedy. The Ontario Court of Appeal has also rejected the argument that equitable limitation periods are invalid because they operate to extinguish Aboriginal rights: Chippewas of Sarnia Band v Canada (Attorney General) (2000), 51 OR (3d) 641 at paras 262-267, 291, 297-302 (CA) [Chippewas], leave to appeal to SCC refused 28365 (November 8, 2001). The Supreme Court of Canada confirmed the Ontario Court of Appeal’s decision in Wewaykum, above, at paras 110-112.
[22] The Supreme Court of Canada has also rejected the argument that the application of limitation periods is inconsistent with Canada’s special fiduciary relationship with Aboriginal peoples: Wewaykum, above, at paras 121-124; Blueberry River, above, at paras 106-122; Manitoba Metis Federation Inc v Canada (Attorney General), 2013 SCC 14 at para 138, 143, 145 [Manitoba Metis]. While the majority in Manitoba Metis found that the declaratory relief sought was exempt from a limitations defence, the Supreme Court of Canada restricted its analysis to the specific constitutional claim before the Court (at para 134); see also Peepeekisis Band v Canada, 2013 FCA 191 at para 54 [Peepeekisis FCA]). The Plaintiffs’ claims are properly characterized as claims for breaches of statutory or fiduciary duties and so fall outside of the narrow constitutional exception established in Manitoba Metis, above, at paras 72, 81.
[23] Section 39 of the Federal Courts Act is applicable to the Plaintiffs’ claims. The Court only needs to decide whether s 39(1) or s 39(2) applies. Canada submits that s 39(1) is applicable. All elements of the claims arose in Alberta and so s 39(1) referentially incorporates Alberta’s limitations legislation: see Ermineskin v Canada, 2006 FCA 415 at paras 323-326, Sexton JA, dissenting [Ermineskin FCA]. Under the LAA, the applicable limitation period is six years: see Stoney Tribal Council v PanCanadian Petroleum Ltd, 2000 ABCA 209 at paras 27-32; Lameman ABQB, above, at para 127.
[24] In response to Samson’s submission that Samson’s claim arose in Ontario, Canada submits that were the Court to find that some elements of the claim have a connection to Ontario while others have a connection to Alberta, this could lead to a finding that the cause of action arose in more than one province so that s 39(2) of the Federal Courts Act would apply. However, s 39(2) also provides for a six-year limitation period: Markevich v Canada, 2003 SCC 9 at para 38 [Markevich]; Apotex Inc v Pfizer Canada Inc, 2004 FC 190 at paras 14-18.
[25] If the Court characterizes the claims as concerning breach of fiduciary duty, then s 4(1)(e) of the Alberta LAA applies. The limitation period is then six years from the date of actual discovery of the claims: Austec Electronic Systems Ltd v Mark IV Industries Ltd, 2001 ABQB 349 at para 30; Ermineskin FCA, above, at para 334, Sexton JA, dissenting. The record clearly establishes that the Plaintiffs and their legal counsel had full knowledge of the Program and its impact upon their royalty entitlements from the time of its inception in 1973.
[26] If the claims are found to relate to an alleged breach of any other duty, then s 4(1)(g) of the Alberta LAA applies. This “catch-all” provision provides that the six-year limitation period commences from the time the claim was discovered or discoverable.
[27] Contrary to the Plaintiffs’ assertions, there can be no claim for breach of common law trust obligations. Canada’s actions cannot give rise to common law trust duties to the Plaintiffs when it acts in accordance with its obligations to all of Canada. In earlier proceedings, the Supreme Court of Canada found that neither Treaty No. 6, the 1946 Surrender, nor the Indian Oil and Gas Act, SC 1974-75-76, c 15 supported an intention to impose the duties of a common law trustee on Canada with respect to the Plaintiffs’ royalties: Ermineskin Indian Band and Nation v Canada, 2009 SCC 9 at paras 50, 72-74, 85 [Ermineskin SCC]. The revenue obtained pursuant to the oil tax and charge was never a trust asset beneficially belonging to the Plaintiffs. It came from the oil companies and not the Plaintiffs. The only trust funds were the royalties paid to Canada by the oil companies and held in trust for the Plaintiffs. These are not the funds at issue in this motion; the Plaintiffs are claiming for additional funds which they never received.
[28] In any event, even if the Court finds the claim is properly characterized as a breach of trust, the limitation period remains six years. The Alberta Court of Queen’s Bench has already interpreted the interaction between the Judicature Act and the Alberta LAA and has held that limitation periods apply to claims for breach of trust commenced between 1980 and 1999: Lameman ABQB, above, at para 123; see also Ermineskin FCA, above, at paras 327-332, Sexton JA, dissenting. There are only two exceptions to the limitation periods applicable to a breach of trust (Lameman ABQB, above, at para 126): (1) if the trustee is still in possession of the trust property or the proceeds of the trust property, or has converted the trust property for his or her own use; or (2) if the trustee has engaged in fraudulent breaches of trust. Neither of these exceptions is applicable in this proceeding. As a result, the six-year limitation period remains applicable, even if the claim is properly characterized as a breach of trust.
[29] Canada rejects the Plaintiffs’ claim that the relevant limitation periods have not commenced because their interest in the royalties that Canada received is not an interest in possession. Canada says that the Plaintiffs enjoyed a present right to receive the royalties throughout the time the oil tax and charge was collected. This right was an interest in possession and the Plaintiffs have received their full entitlement under that right.
[30] Canada submits that discoverability suspends the running of a limitation period until the material facts upon which a cause of action is based are discovered, or ought to have been discovered, by the plaintiff exercising reasonable diligence: Central Trust Co v Rafuse, [1986] 2 SCR 147 at 224; Lameman ABQB, above, at para 136. Discoverability applies to facts, not law: Luscar Ltd v Pembina Resources Ltd, 1994 ABCA 356 at para 129 [Luscar Ltd]; Ermineskin FCA, above, at para 334, Sexton JA, dissenting; Lameman SCC, above, at paras 16-17. A claim is discovered when the plaintiff knows all of the facts it needs to know to bring its action: Luscar Ltd, above, at para 138; Ermineskin FCA, above, at para 334, Sexton JA, dissenting; Lameman SCC, above, at paras 16-17. The principle of discoverability applies to all statutory limitation provisions unless there is clear legislative language in place to displace the rule: Peixeiro v Haberman, [1997] 3 SCR 549 at para 38.
[31] Canada says the distinction between actual discovery and discoverability is irrelevant in this proceeding. The Plaintiffs knew all the facts required to make their claims in the 1970s and discovered their claims well before the six-year limitation period expired. The Plaintiffs were sophisticated, well informed, and used a variety of professional and legal advisors as early as the 1970s. The use of legal advisors by an Indian Band is a significant factor in determining discoverability: Wewaykum, above, at paras 57, 123; Kruger, above, at para 90; Lameman ABQB, above, at para 139. Crown officials shared information with the Plaintiffs’ legal counsel, including the substance of legal opinions, throughout the development and implementation of the Program. There is nothing to rebut the evidence that Canada advised the Plaintiffs that their claims for a return of the oil tax had been rejected in the mid-1970s. There is evidence that the Plaintiffs considered commencing litigation in 1981. As a result, December 1987 was the very latest that the Plaintiffs could have started their actions without being barred by a limitations defence.
[32] Canada also disputes the Plaintiffs’ submission that their claims are based on continuing breaches. The Supreme Court of Canada rejected this proposition in Wewaykum, above, at para 135; see also Huang v Drinkwater, 2005 ABQB 40 at paras 73-77 [Huang]; Alberta Municipal Retired Police Officers’ Mutual Benefit Society v Alberta, 2010 ABQB 458 at paras 79, 83-85, 92 [Mutual Benefit Society]. The Plaintiffs’ claims crystallized in the mid-1970s.
[33] However, even if the claims could be properly characterized as recurring or continuing breaches, then they are limited to the breaches arising six years before the claims were filed: see Chitty on Contracts, 29th Ed, London: Sweet & Maxwell, 2004 cited in James H Meek, Jr Trust v San Juan Resources Inc, 2005 ABCA 448 at para 48; see also Epcor Power LP v Petrobank Energy and Resources Ltd, 2010 ABQB 463 at para 73, aff’d 2010 ABCA 378 [Epcor Power]. As such, the Plaintiffs could only succeed in regard to any incremental royalty amounts payable within the six years prior to the commencement of their actions.
[34] Finally, Canada submits that equitable limitation periods apply to Aboriginal claims: Wewaykum, above, at paras 110-111. The Plaintiffs’ claims are barred by both laches and acquiescence.
B. Samson Plaintiffs [35] Samson says that the Supreme Court of Canada recently recast the test for summary judgment in Hryniak v Mauldin, 2014 SCC 7 at para 49 [Hryniak]:
There will be no genuine issue requiring a trial when the judge is able to reach a fair and just determination on the merits on a motion for summary judgment. This will be the case when the process (1) allows the judge to make the necessary findings of fact, (2) allows the judge to apply the law to the facts, and (3) is a proportionate, more expeditious and less expensive means to achieve a just result.
[36] The Supreme Court of Canada has explained that what is “fair and just” depends on the nature of the issues, the nature and strength of the evidence, and the selection of the proportional procedure. A partial summary judgment is not in the interests of justice when it runs the risk of duplicative proceedings or inconsistent findings of fact. The oil tax and charge issues in the present case are one piece of a large action. Summary judgment would simply bifurcate the further phases of the action.
[37] The Court can only make “findings of fact or law where the relevant evidence is available on the record and does not involve a serious question of fact or law which turns on the drawing of inferences”: Source Enterprises Ltd v Canada (Public Safety and Emergency Preparedness), 2012 FC 966 at paras 14-21 [Source Enterprises], citing Apotex Inc v Merck & Co, 2002 FCA 210. Material findings of fact in this motion could prejudice the Samson Plaintiffs’ claims in the broader action. This motion is an inappropriate attempt to minimize Canada’s exposure to damages. Canada has already acknowledged that it is liable for six years of damages (Canada’s April 15, 2000 “Position on the Issues”).
[38] The Samson Plaintiffs characterize their claims as involving breaches of treaty rights, the sui generis fiduciary relationship it shares with Canada, and the express trust under which Canada took possession, management and control of Samson’s mineral rights on the Reserve. This trust is governed by both common law and statute (the Indian Oil and Gas Act and the Indian Act). Canada is an express trustee who has committed a breach of trust. The Samson Plaintiffs seek an accounting and recovery of the trust property and money that Canada received, held, managed, and retained on behalf of Samson.
[39] Canada’s trust, fiduciary, and trust-like obligations to Samson are rooted in the historic relationship between Canada and Aboriginal peoples and the text of Treaty No. 6. Parliament does not have the authority to create limitation periods to extinguish the Samson Plaintiffs’ claims. Canada must express its intention to extinguish an Aboriginal right in “clear and plain” language: Calder et al v Attorney-General of British Columbia, [1973] SCR 313 [Calder]. This requires “clear evidence that [Canada] actually considered the conflict between its intended action on the one hand and Indian treaty rights on the other, and chose to resolve that conflict by abrogating the treaty” right: R v Van der Peet, [1996] 2 SCR 507 at para 286 [Van der Peet], quoting United States v Dion, 476 US 734 (1986) at 739-740. The Ontario Court of Appeal has applied the “clear and plain” test to limitations statutes: Chippewas, above, at para 229. Limitations legislation constitutes substantive, rather than procedural limits, on a cause of action: Tolofson v Jensen; Lucas (Litigation Guardian of) v Gagnon, [1994] 3 SCR 1022 at 1070-1071 [Tolofson]. The application of s 39 of the Federal Courts Act would constitute not only a substantive bar to the Samson Plaintiffs’ treaty rights but would extinguish any part of their claim arising before September 1983. However, Parliament did not use “clear and plain” language in s 39 of the Federal Courts Act to create a limitation period for the Samson Plaintiffs’ Aboriginal rights claims. Provincial law cannot extinguish treaty rights even if incorporated into federal legislation.
[40] The application of a limitations statute to eliminate Samson’s royalty interest would render Samson’s treaty right to the minerals underlying the Reserve meaningless. The ability to enforce Samson’s rights is an integral party of its bundle of treaty rights. Samson’s treaty rights existed prior to s 35 of the Constitution Act, 1982, being Schedule B to the Canada Act, 1982 (UK), 1982, c 11 and so prevail over inconsistent legislation: R v Sparrow, [1990] 1 SCR 1075 at 1105-1109 [Sparrow]; R v Marshall, [1999] 3 SCR 456 at paras 48, 67; Reference re Secession of Quebec, [1998] 2 SCR 217 at para 72. Since 1982, limitations statutes do not apply per se to Aboriginal claims but must first meet the test for infringement and justification: Sparrow, above. This requires that: (1) the government must demonstrate that it was acting pursuant to a valid legislative objective; and (2) that the government demonstrate its actions are consistent with its fiduciary duty towards Aboriginal peoples: R v Gladstone, [1996] 2 SCR 723 at paras 54-55 [Gladstone]. Canada has not presented any evidence or argument to justify the infringement. Neither the Oil Export Tax Act or the Petroleum Administration Act express any need to appropriate First Nations’ royalty interests. Canadian consumers’ interests were protected without the need to resort to appropriation. The Court cannot find justification in the absence of evidence from Canada: R v Badger, [1996] 1 SCR 771 at para 98 [Badger]. Special consideration must also be given to the Honour of the Crown: Badger, above, at para 97. Canada is invoking a limitations defence to avoid liability for conduct which is inconsistent with the Honour of the Crown, treaty principles and trust principles.
[41] Samson says that if the Court finds that s 39(1) of the Federal Courts Act is constitutionally valid and enforceable, the Court should apply the equitable principle which prevents a fiduciary from setting up a statute of limitations to bar a plaintiff’s suit: Taylor v Davies (1919), [1920] 1 WWR 683 at para 19, 51 DLR 75 (PC) [Taylor].
[42] If the Court applies s 39(1) of the Federal Courts Act, Ontario is the proper situs of this action. The legal situs of Her Majesty’s Government of the Dominion of Canada is the Parliament Buildings in Ottawa, Ontario: Constitution Act, 1987, s 16; Canadian Pacific Railway Company v Outlook (Town), [1924] 3 WWR 494 at para 7 (SKQB). Both the Receiver General and the CRF are located in Ottawa, Ontario and so Canada’s breaches respecting the management of the funds took place in Ontario. Further, in actions respecting the administration of a trust, the law of the residence of the trustee applies: Donovan W.M. Waters, QC, ed, Waters’ Law of Trusts in Canada, 3rd ed (Toronto: Thomson Canada Ltd, 2005) at 1379-1380; Branco v Veira (1995), 8 ETR (2d) 49, [1995] OJ no 1071 (QL) at paras 19-22 (CJ). If s 39(1) of the Federal Courts Act applies then it incorporates Ontario’s limitations legislation.
[43] Under the Ontario Limitations Act, RSO 1980, c-240, a trustee cannot use a limitations defence to bar a claim from a beneficiary to recover trust property or the proceeds of trust property that the trustee still retains: s 43(2); Lameman ABQB, above, at paras 127, 149. Absent evidence regarding what the trustee used the trust property for, the Court will assume the trust property was retained and is held by a trustee: Wassell v Leggatt, [1896] 1 Ch D 554 at 558; In Re Eyre-Williams, [1923] 2 Ch D 533 at 541. The Ontario Limitations Act also prevents a trustee from barring a claim against trust property that a trustee has converted to his or her own use: s 43(2); In Re Sharpe, [1906] 1 Ch D 793. Canada has retained the funds for its own benefit without Samson’s consent. Contrary to Canada’s submissions, Justice Rothstein did not find that Canada owed no common law trust duties in relation to the oil royalties. Justice Rothstein found that Canada was a fiduciary with trust-like capabilities. He only found that Canada had no common law trust duty to invest the Band’s funds: Ermineskin SCC, above, at paras 72, 181.
[44] If the Court finds that none of these barriers to a trustee relying on limitation periods applies, then the Samson Plaintiffs say there is no limitation period applicable to their beneficial interest because it cannot be characterized as a common law property interest in possession: Guerin v The Queen, [1984] 2 SCR 335 at 382 [Guerin]; St Mary’s Indian Band v Cranbrook (City), [1997] 2 SCR 657 at paras 14-16. In the alternative, Samson’s interest became an interest in possession in 2006 when Canada paid Samson the monies it held in trust in the CRF.
[45] If the Court finds a six-year limitation period applies, then the time period did not begin to run until the Samson Plaintiffs discovered, or ought reasonably to have discovered, the facts with respect to the remedy they seek: Mackey Estate v Mackey (1986), 24 ETR 174 at para 25, [1986] OJ no 410 (QL)(SCJ). A breach of trust or trust-like obligations is not discoverable until the beneficiary appreciates that there has been an actionable breach of the fiduciary obligation: M(K) v M(H), [1992] 3 SCR 6 at 47-48; Switzer v Switzer (1995), 176 AR 150 at para 13 (QB) [Switzer]. The Federal Court of Appeal has held that, before Guerin, “it could not be said that the reasonable plaintiff would have viewed the band’s cause of action [breach of Canada’s fiduciary duty] as having ‘a reasonable prospect of success’”: Semiahmoo Indian Band v Canada (1997), [1998] 1 FC 3 at para 86, 148 DLR (4th) 523 (CA) [Semiahmoo]; see also Blueberry River, above. In the present case, Canada had exclusive possession of the relevant facts and information. The Samson Plaintiffs could not have been aware of the potential cause of action for the underpayment of the royalties due and owing on exported Reserve oil. They commenced their action within six years after the cause of action was reasonably discoverable or discovered.
[46] If the Court does not apply the trustee limitation periods, then there is no doubt that Canada was acting and holding Samson’s property as a fiduciary. There is no limitation period for a breach of fiduciary duty under Ontario limitations statutes: M(K) v M(H), above, at 70; Chippewas of Sarnia Band v Canada (Attorney General), [1999] OJ no 1406 (QL) at para 506 (SCJ). Further, Ontario’s limitations statute does not include a “catch-all” provision. Every possible limitation period is included in the statute.
[47] If the Court finds that Alberta’s limitations legislation is referentially incorporated and applicable under s 39 of the Federal Courts Act, then the Samson Plaintiffs submit that no limitations statute can bar a claim from a beneficiary against a trustee: Judicature Act, s 14. The Alberta Judicature Act was in force when the Samson Plaintiffs brought their claim. It expressly and constitutionally overrides s 41 of the Alberta LAA: Chaba v Chaba (1995), 166 AR 392 at para 11 (QB); Taylor, above, at para 19; Soar v Ashwell, [1893] QB 390 at 394, 397 (Eng CA); Gregory v Torquay Corporation, [1911] 2 KB 556 at 559-561 (Eng CA); In re Fountaine, [1909] 2 Ch D 382 at 389-392 (Eng CA). If the Court does not apply the Alberta Judicature Act, then the Samson Plaintiffs reiterate their earlier arguments on the six-year trustee limitation period.
[48] The Alberta LAA requires actual discovery of the facts which led to the cause of action in a claim for damages aris