GLOBE-Net, January 31, 2013 – A recent decision out of the Yukon has the potential to significantly impact on the right of “free entry” established under mining legislation in most jurisdictions in Canada.
The decision confirmed that recording a mineral claim can trigger the government’s consultation obligations with aboriginal groups. This principle may ultimately mean that prospectors and companies carrying out mineral exploration activities in Canada will face additional obligations and restrictions in securing mineral title.
It may also pose challenges in a highly competitive exploration industry where there is a need for explorationists to maintain confidentiality until they have secured title to their claims.
[stextbox id=”custom” float=”true” width=”200″ bcolor=”add3d5″ bgcolor=”add3d5″ image=”null”]This principle, if it ultimately stands, would pose a serious challenge to the existing mineral tenure regimes under most mining statutes in Canada.[/stextbox]
In Ross River Dena Council v. Government of Yukon, the Yukon Court of Appeal considered the application of the Crown’s duty to consult to the location and recording of mineral claims under the Quartz Mining Act (Act).
The Act establishes a “free entry” mineral tenure system, under which the Mining Recorder must record a mineral claim, without any exercise of discretion, upon receipt of an application that complies with statutory requirements.
Recording a claim under the Act immediately confers on the claim holder the ability to carry out a number of “Class 1” exploration activities without obtaining any additional permits or approvals and without providing any notice to the Crown or First Nations.
The lower court had held that the recording of a claim met the three-part test set out by the Supreme Court of Canada to determine whether the Crown’s duty to consult is triggered:
(i) the Crown had knowledge of RRDC’s asserted aboriginal claims;
(ii) there was contemplated Crown conduct in the form of the recording of a mineral claim; and
(iii) there was a potential that the Crown’s conduct may adversely affect RRDC’s claims.
In reaching its conclusion, however, the lower court focused primarily on the potential impact of the Class 1 exploration activities on RRDC’s asserted aboriginal rights.
In most Canadian jurisdictions, exploration activities similar to the Class 1 activities under the Act are not automatically granted upon the registration of a claim, but rather require additional authorizations (giving the Crown the opportunity to consult with aboriginal groups prior to any significant exploration activities being undertaken).
Because of this, the lower court decision did not necessarily stand for the general proposition that the registration of a mineral claim triggers the Crown’s duty to consult. Rather, it was a specific decision that was generally unique to the Yukon as a result of the Act.
While the Court of Appeal agreed with the lower court on most points, it went further by finding that the granting of the mineral claim by itself potentially impacts aboriginal title. As a result, this decision may have much broader implications for the system of free entry in other Canadian jurisdictions.
While acknowledging the importance of free entry, the Court of Appeal found that constitutional duties must nevertheless be fulfilled: “I fully understand that the open entry [free entry] system continued under the Quartz Mining Act has considerable value in maintaining a viable mining industry and encouraging prospecting.
I also acknowledge that there is a long tradition of acquiring mineral claims by staking, and that the system is important both historically and economically to Yukon. It must, however, be modified in order for the Crown to act in accordance with its constitutional duties.”
While the activities sanctioned by the registration of a mining claim under the Act may attract consultation, it is a significant conclusion that the registration of a mining claim, by itself, can impact a potential claim of Aboriginal title.
This principle, if it ultimately stands, would pose a serious challenge to the existing mineral tenure regimes under most mining statutes in Canada.
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By Sam Adkins and Thomas F. Isaac
McCarthy Tétrault LLP
This article first appeared in Lexology.com and is reprinted here with the kind permission of the authors.