Keewatin et al. v. Minister of Natural Resources et al.; The Attorney General of Canada, Third Party

[Indexed as: Keewatin v. Ontario (Minister of Natural Resources)]

Ontario Reports

Court of Appeal for Ontario,

Sharpe, Gillese and Juriansz JJ.A.

March 18, 2013

114 O.R. (3d) 401 | 2013 ONCA 158

Case Summary

Aboriginal peoples — Treaties — Canada and Saulteaux Tribe of Ojibway Indians entering into Treaty 3 in 1873 — Treaty containing clause by virtue of which Ojibway retained right to hunt and fish throughout surrendered land except on lands required or taken up for settlement, mining, lumbering or other purposes by Government of Canada — Keewatin portion of lands governed by Treaty 3 becoming part of Ontario in 1912 — Trial judge erring in finding that Ontario did not have right to "take up" lands and thereby limit aboriginal harvesting rights without first obtaining Canada's approval in Keewatin portion of Treaty 3 lands — Ontario acquiring beneficial ownership of Keewatin lands under s. 109 of Constitution Act when those lands became part of Ontario — Ontario taking place of Canada as level of government with capacity to take up lands when beneficial ownership was transferred — Trial judge erring in finding that s. 91(24) of Constitution Act gives Canada continuing role in respect of taking up of lands for provincial purposes in lands ceded by treaty — Constitution Act, 1867, ss. 91, para. 24, 109.

Canada and the Saulteaux Tribe of the Ojibway Indians entered into Treaty 3 in 1873 in respect of a large tract of land located in what is now northwestern Ontario and eastern Manitoba. The Ojibway surrendered their interest in the lands in exchange for reserves, payments and other benefits. Treaty 3 contained a "harvesting clause" by virtue of which the Ojibway retained the right to hunt and fish throughout the surrendered tract except on tracts required or taken up for settlement, mining, lumbering or other purposes by the Dominion of Canada. The Keewatin District was under Canada's jurisdiction in 1873 and became part of Ontario in 1912. In 1997, Ontario issued a sustainable forest licence which enabled a pulp and paper manufacturer to carry out clear-cut forestry operations in certain parts of the Keewatin District. The plaintiffs brought an action alleging that the forestry operations were in violation of the Treaty 3 harvesting clause. The trial judge found that Ontario did not have the authority, within the Treaty 3 lands that were added to Ontario in 1912, to exercise the right to take up tracts of land for forestry, so as to limit the plaintiffs' rights to hunt or fish, without first obtaining Canada's approval, and that Ontario did not have the authority pursuant to the division of powers under the Constitution Act, 1867 to justifiably infringe the plaintiffs' rights to hunt and fish as provided for by Treaty 3. The defendants appealed.

Held, the appeal should be allowed.

The trial judge erred in holding that Ontario cannot authorize the taking up of land in the Keewatin District without Canada's approval or permission. By virtue of s. 109 of the Constitution Act, 1867, Ontario beneficially owns the public lands governed by Treaty 3 situated within its borders, and by virtue of s. 92(5) of the Constitution Act, 1867, Ontario has exclusive legislative authority to manage and sell those public lands. Ontario's beneficial ownership, combined with the [page402] exclusive legislative authority to manage and sell the lands, embraces the things that would amount to taking up lands governed by Treaty 3 for settlement, mining, lumbering or other purposes, including in the Keewatin lands. The trial judge erred in finding that the commissioners who negotiated the treaty qualified Ontario's constitutional rights and responsibilities by agreeing to a requirement that Canada interpose itself and approve the taking up of lands. The commissioners had no authority to depart from the Constitution's allocation of powers and responsibilities and no power to deprive Ontario of the beneficial ownership that devolved to the province when Ontario's borders expanded. The harvesting clause also had to be interpreted in light of the process of constitutional evolution. The promise made in the harvesting clause was that of the Crown, not Canada. Responsibility for respecting the Crown's promises falls to be determined by the allocation of powers under the Constitution and the location of that responsibility evolves as the Constitution evolves. The Crown, acting on the advice of the Government of Ontario as the owner and administrator of the lands, is bound to keep the promise it made in the harvesting clause. Moreover, the text of the harvesting clause plainly does not reflect or contemplate a two-step approval involving two levels of government for taking up tracts of land. It refers only to the Dominion of Canada. The reference to the Dominion of Canada reflected the fact that in 1873, Canada claimed beneficial ownership of all the lands governed by Treaty 3. When beneficial ownership was transferred to Ontario, Ontario took the place of Canada as the level of government with the capacity to take up lands, subject to the rights guaranteed by the treaty. Finally, the trial judge's interpretation produces a process that is unnecessary, complicated, awkward and likely unworkable. The two-step process is unnecessary to protect the aboriginal treaty harvesting right because when the Crown, through Ontario, takes up land, it must respect the treaty right. Subsequent legislation and agreements in 1891, 1894 and 1912 confirmed Ontario's right to take up under Treaty 3 without Canada's approval.

Cases referred to

Dominion of Canada v. Province of Ontario, 1910 CanLII 466 (UK JCPC), [1910] J.C.J. No. 1, [1910] A.C. 637, [1910] C.R.A.C. 301 at 479, 26 T.L.R. 681 (P.C.); Mikisew Cree First Nation v. Canada (Minister of Canadian Heritage), [2005] 3 S.C.R. 388, [2005] S.C.J. No. 71, 2005 SCC 69, 259 D.L.R. (4th) 610, 342 N.R. 82, J.E. 2005-2156, 37 Admin. L.R. (4th) 223, [2006] 1 C.N.L.R. 78, 21 C.P.C. (6th) 205, 143 A.C.W.S. (3d) 957, EYB 2005-97906; Mitchell v. M.N.R., [2001] 1 S.C.R. 911, [2001] S.C.J. No. 33, 2001 SCC 33, 199 D.L.R. (4th) 385, 269 N.R. 207, J.E. 2001-1066, [2001] 3 C.N.L.R. 122, 83 C.R.R. (2d) 1, [2002] 3 C.T.C. 359, 5 T.T.R. (2d) 567, 105 A.C.W.S. (3d) 361, REJB 2001-24177; Ontario Mining Co. v. Seybold, 1902 CanLII 241 (UK JCPC), [1902] J.C.J. No. 2, [1903] A.C. 73, 13 C.R.A.C. 75 (P.C.), affg (1901), 1901 CanLII 80 (SCC), 32 S.C.R. 1, [1901] S.C.J. No. 63, affg (1900), 1900 CanLII 204 (ON SC), 32 O.R. 301, [1900] O.J. No. 126 (Div. Ct.), affg (1899), 1899 CanLII 203 (ON SC), 31 O.R. 386, [1899] O.J. No. 113 (Ch. Div.); Smith v. Canada, 1983 CanLII 134 (SCC), [1983] 1 S.C.R. 554, [1983] S.C.J. No. 39, 147 D.L.R. (3d) 237, 47 N.R. 132, [1983] 3 C.N.L.R. 161, 20 A.C.W.S. (2d) 8; St. Catherine's Milling and Lumber Co. v. Ontario, 1888 CanLII 209 (UK JCPC), [1888] J.C.J. No. 1, 14 App. Cas. 46, 10 C.R.A.C. 13, 4 Cart. 107 (P.C.), affg (1887), 1887 CanLII 3 (SCC), 13 S.C.R. 577, [1887] S.C.J. No. 3, affg 1886 CanLII 30 (ON CA), [1886] O.J. No. 108, 13 O.A.R. 148 (C.A.), affg (1885), 1885 CanLII 288 (ON SC), 10 O.R. 196 (Ch. Div.), consd

Other cases referred to

Canadian Western Bank v. Alberta, [2007] 2 S.C.R. 3, [2007] S.C.J. No. 22, 2007 SCC 22, 281 D.L.R. (4th) 125, 362 N.R. 111, [2007] 8 W.W.R. 1, J.E. 2007-1068, 75 Alta. L.R. (4th) 1, 409 A.R. 207, [2007] R.R.A. 241, 49 C.C.L.I. (4th) 1, [2007] I.L.R. I-4622, 157 A.C.W.S. (3d) 299, EYB 2007-120167; Delgamuukw v. British Columbia, 1997 CanLII 302 (SCC), [1997] 3 S.C.R. 1010, [1997] S.C.J. No. 108, 153 D.L.R. (4th) 193, 220 N.R. 161, [1999] 10 W.W.R. 34, 99 B.C.A.C. 161, 66 B.C.L.R. (3d) 285, [1998] 1 C.N.L.R. 14, 75 A.C.W.S. (3d) 983; [page403] Ermineskin Indian Band and Nation v. Canada, [2009] 1 S.C.R. 222, [2009] S.C.J. No. 9, 2009 SCC 9, 384 N.R. 203, J.E. 2009-348, EYB 2009-154400, 302 D.L.R. (4th) 577, [2009] 2 C.N.L.R. 102, affg [2006] F.C.J. No. 1961, 2006 FCA 415, [2007] 3 F.C.R. 245, 357 N.R. 1, [2007] 2 C.N.L.R. 51, 154 A.C.W.S. (3d) 750; Haida Nation v. British Columbia (Minister of Forests), [2004] 3 S.C.R. 511, [2004] S.C.J. No. 70, 2004 SCC 73, 245 D.L.R. (4th) 33, 327 N.R. 53, [2005] 3 W.W.R. 419, J.E. 2004-2156, 206 B.C.A.C. 52, 36 B.C.L.R. (4th) 282, 19 Admin. L.R. (4th) 195, 11 C.E.L.R. (3d) 1, [2005] 1 C.N.L.R. 72, 26 R.P.R. (4th) 1, 135 A.C.W.S. (3d) 2; Keewatin v. Ontario (Minister of Natural Resources) (2003), 2003 CanLII 43991 (ON SCDC), 66 O.R. (3d) 370, [2003] O.J. No. 2937 (Div. Ct.); R. v. 974649 Ontario Inc., [2001] 3 S.C.R. 575, [2001] S.C.J. No. 79, 2001 SCC 81, 206 D.L.R. (4th) 444, 279 N.R. 345, J.E. 2002-9, 154 O.A.C. 345, 159 C.C.C. (3d) 321, 47 C.R. (5th) 316, 88 C.R.R. (2d) 189, 51 W.C.B. (2d) 452, REJB 2001-27030; R. v. Badger, 1996 CanLII 236 (SCC), [1996] 1 S.C.R. 771, [1996] S.C.J. No. 39, 133 D.L.R. (4th) 324, 195 N.R. 1, [1996] 4 W.W.R. 457, J.E. 96-737, 37 Alta. L.R. (3d) 153, 181 A.R. 321, 105 C.C.C. (3d) 289, [1996] 2 C.N.L.R. 77, 30 W.C.B. (2d) 211; R. v. Bernard, [2005] 2 S.C.R. 220, [2005] S.C.J. No. 44, 2005 SCC 43, 255 D.L.R. (4th) 1, 336 N.R. 22, J.E. 2005-1361, 287 N.B.R. (2d) 206, 235 N.S.R. (2d) 151, 198 C.C.C. (3d) 29, 15 C.E.L.R. (3d) 163, [2005] 3 C.N.L.R. 214, 141 A.C.W.S. (3d) 156; R. v. Marshall, 1999 CanLII 665 (SCC), [1999] 3 S.C.R. 456, [1999] S.C.J. No. 55, 177 D.L.R. (4th) 513, 246 N.R. 83, J.E. 99-1800, 178 N.S.R. (2d) 201, 138 C.C.C. (3d) 97, [1999] 4 C.N.L.R. 161, 43 W.C.B. (2d) 383; R. v. Secretary of State for Foreign and Commonwealth Affairs, ex parte Indian Association of Alberta, [1982] 2 All E.R. 118, [1982] Q.B. 892, [1982] 2 W.L.R. 641 (C.A.); R. v. Sioui, 1990 CanLII 103 (SCC), [1990] 1 S.C.R. 1025, [1990] S.C.J. 48, 70 D.L.R. (4th) 427, 109 N.R. 22, J.E. 90-823, 30 Q.A.C. 280, 56 C.C.C. (3d) 225, [1990] 3 C.N.L.R. 127, 10 W.C.B. (2d) 203; R. v. Sparrow, 1990 CanLII 104 (SCC), [1990] 1 S.C.R. 1075, [1990] S.C.J. No. 49, 70 D.L.R. (4th) 385, 111 N.R. 241, [1990] 4 W.W.R. 410, J.E. 90-851, 46 B.C.L.R. (2d) 1, 56 C.C.C. (3d) 263, [1990] 3 C.N.L.R. 160, 10 W.C.B. (2d) 194; R. v. Ulybel Enterprises Ltd., [2001] 2 S.C.R. 867, [2001] S.C.J. No. 55, 2001 SCC 56, 203 D.L.R. (4th) 513, 275 N.R. 201, J.E. 2001-1823, 206 Nfld. & P.E.I.R. 304, 157 C.C.C. (3d) 353, 45 C.R. (5th) 1, 51 W.C.B. (2d) 180; Reference Re Securities Act, [2011] 3 S.C.R. 837, [2011] S.C.J. No. 66, 2011 SCC 66, 2012EXP-5, J.E. 2012-4, EYB 2011-199884, 424 N.R. 1, 339 D.L.R. (4th) 577, 519 A.R. 63, 208 A.C.W.S. (3d) 490, 97 B.L.R. (4th) 1; Rizzo & Rizzo Shoes Ltd. (Re) (1998), 1998 CanLII 837 (SCC), 36 O.R. (3d) 418, [1998] 1 S.C.R. 27, [1998] S.C.J. No. 2, 154 D.L.R. (4th) 193, 221 N.R. 241, J.E. 98-201, 106 O.A.C. 1, 50 C.B.R. (3d) 163, 33 C.C.E.L. (2d) 173, 98 CLLC Â210-006, 76 A.C.W.S. (3d) 894; Sharbern Holding Inc. v. Vancouver Airport Centre Ltd., [2011] 2 S.C.R. 175, [2011] S.C.J. No. 23, 2011 SCC 23, 306 B.C.A.C. 1, 82 C.C.L.T. (3d) 1, 416 N.R. 1, EYB 2011-190358, [2011] 7 W.W.R. 1, 2011EXP-1577, J.E. 2011-871, 331 D.L.R. (4th) 1, 18 B.C.L.R. (5th) 1, 5 R.P.R. (5th) 1, 81 B.L.R. (4th) 1

Statutes referred to

An Act for the settlement of certain questions between the Governments of Canada and Ontario respecting Indian Lands (C.A.), 54 & 55 Vict., c. 5

An Act for the settlement of certain questions between the Governments of Canada and Ontario respecting Indian Lands (ON), 54 Vict., c. 3

An Act to express the Consent of the Legislative Assembly of the Province of Ontario to an Extension of the Limits of the Province (ON), 2 Geo. V., c. 3

Canada (Ontario Boundary) Act, 1889 (U.K.), 52-53 Vict., c. 28

Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 [as am.]

Constitution Act, 1867, ss. 91, para. 24, 92, para. 5, 92A, 108, 109, 117, Sch. 3

Constitution Act, 1982, being Schedule B to the Canada Act 1982 (U.K.), 1982, c. 11, s. 35

Indian Act, R.S.C. 1985, c. I-5, s. 88 [as am.] [page404]

Indian Lands Act, 1924, S.C. 1924, c. 48, Sch. 1

Indian Lands Act, 1924, S.O. 1924, c. 15, Sch. A

Interpretation Act, R.S.C. 1985, c. I-21, s. 13

Natural Resources Transfer Agreement, 1930, being Schedule 2 (Alberta) and Schedule 3 (Saskatchewan) to the Constitution Act, 1867, s. 1

Ontario Boundaries Extension Act, 1912 (C.A.), 2 Geo. V., c. 40

Authorities referred to

House of Commons Debates, 12th Parl., 1st Sess., No. 2 (February 27, 1912), at p. 3906

Treaties and conventions referred to

Treaty 3 between Her Majesty the Queen and the Saulteaux Tribe of the Ojibbeway Indians at the Northwest Angle on the Lake of the Woods with Adhesions

Treaty No. 6 between Her Majesty the Queen and the Plain and Wood Cree Indians and other Tribes of Indians at Fort Carlton, Fort Pitt and Battle River with Adhesions

APPEAL from the judgment of Sanderson J., [2011] O.J. No. 3907, 2011 ONSC 4801, [2011] 1 C.N.L.R. 13 (S.C.J.) allowing an action attacking Ontario's exercise of a treaty clause.

Michael R. Stephenson, Mark R. Crow, Peter R. Lemmond and Candice Telfer, for appellant Minister of Natural Resources.

Gary N. Penner and Barry M. Ennis, for appellant Attorney General of Canada.

Christopher J. Matthews, for appellant Resolute FP Canada Inc.

William J. Burden, Thomas F. Isaac and Linda I. Knol, for intervenor Goldcorp Inc.

Robert J.M. Janes, Karey Brooks and Elin Sigurdson, for respondents.

Bruce Stadfeld McIvor, for intervenors Big Grassy First Nation, Ochiichagwe'Babigo'ining Ojibway Nation, Ojibways of Onigaming First Nation, Naotkamegwanning First Nation, and Shoal Lake #40 First Nation.

Leslie Cameron, on his own behalf and on behalf of all other members of Wabauskang First Nation.

Peter W. Hutchins, Zachary Davis and Robin Campbell, for intervenor Grand Council of Treaty #3.

David G. Leitch and Travis Moffatt, for intervenor Lac Seul First Nation.

Abram Averbach, for intervenors Ermineskin Cree Nation, Muskeg Lake Cree Nation #102, Whitefish (Goodfish) Lake First Nation #128 and Samson Cree Nation. [page405]

BY THE COURT: --

A. Overview

[1] On October 3, 1873, Canada and the Saulteaux Tribe of the Ojibway Indians (the "Ojibway") entered into Treaty 3 between Her Majesty the Queen and the Salteaux Tribe of the Ojibbeway Indians of the Northwest Angle on the Lake of the Woods with Adhesions ("Treaty 3") in respect of a large tract of land situated in what is now northwestern Ontario and eastern Manitoba. By entering into Treaty 3, the Ojibway surrendered their interest in the lands in exchange for reserves, payments and other benefits. Treaty 3 contains a "harvesting clause" by virtue of which the Ojibway retain the right "to pursue their avocations of hunting and fishing throughout the tract surrendered" except on tracts "required or taken up for settlement, mining, lumbering or other purposes by [the] Government of the Dominion of Canada".

[2] Treaty 3 covers an area of approximately 55,000 square miles. In 1873, Canada claimed ownership of all of the territory covered by Treaty 3. The treaty was negotiated by commissioners appointed by the Dominion of Canada. Part of the territory, the Keewatin District, was unquestionably under Canada's jurisdiction in 1873 and another part of the territory was disputed with Ontario. Since 1912, all of the Treaty 3 territory, except for a small portion in Manitoba, has been within the borders of Ontario.

[3] The central issue on these appeals is whether Ontario has the right to "take up" lands and thereby limit harvesting rights without first obtaining Canada's approval in the Keewatin portion of the Treaty 3 lands (the "Keewatin lands").

The claim

[4] The plaintiffs in this action and respondents on these appeals are members of the Grassy Narrows First Nation ("Grassy Narrows"). In 1997, Ontario's Minister of Natural Resources ("Ontario") issued a sustainable forest licence, which enabled Abitibi-Consolidated Inc., a large pulp and paper manufacturer, to carry out clear-cut forestry operations in certain parts of the Whiskey Jack Forest, which falls within the Keewatin portion of the Treaty 3 territory.

[5] In 2000, Grassy Narrows applied for judicial review to set aside all licences, permits, management plans and work schedules that Ontario had granted to Abitibi, alleging that the forestry operations were in violation of the Treaty 3 harvesting clause. The Divisional Court quashed the application for judicial review on the grounds that it lacked the jurisdiction to grant some of [page406] the relief sought and there were complex questions of fact and law that required a trial. Grassy Narrows was permitted to bring an action raising the same issues: Keewatin v. Ontario (Minister of Natural Resources) (2003), 2003 CanLII 43991 (ON SCDC), 66 O.R. (3d) 370, [2003] O.J. No. 2937 (Div. Ct.).

[6] In January 2005, the plaintiffs launched the action from which these appeals are taken.

The case management order

[7] In 2006, Spies J. made a case management order dividing the trial into two phases. The order directed that the first phase would involve the trial of two issues:

Question One: Does Her Majesty the Queen in Right of Ontario have the authority within that part of the lands subject to Treaty 3 that were added to Ontario in 1912, to exercise the right to "take up" tracts of land for forestry, within the meaning of Treaty 3, so as to limit the rights of the plaintiffs to hunt or fish as provided for in Treaty 3?

Question Two: If the answer to question/issue 1 is no, does Ontario have the authority pursuant to the division of powers between Parliament and the legislatures under the Constitution Act, 1867 to justifiably infringe the rights of the plaintiffs to hunt and fish as provided for in Treaty 3?

[8] Question one turns on the interpretation of Treaty 3's harvesting clause, which preserves the Ojibway's hunting and fishing rights subject to a "taking up clause":

Her Majesty further agrees with Her said Indians, that they the said Indians shall have [the] right to pursue their avocations of hunting and fishing throughout the tract surrendered as hereinbefore described subject to such regulations as may from time to time be made by Her Government of Her Dominion of Canada and saving and excepting such tracts as may, from time to time, be required or taken up for settlement, mining, lumbering or other purposes by Her said Government of the Dominion of Canada, or by any of the subjects thereof duly authorized therefor by the said Government.

[9] Question two, which is only necessary to answer if the response to question one is no, looks at the division of powers in the abstract. It does not consider any specific licence or legislation. [page407]

[10] Spies J.'s order contemplates another phase of the trial to determine the plaintiffs' claim with respect to the validity of the specific forestry licence and practices. The second phase of litigation has yet to commence.

Judgment under appeal

[11] After an extended trial on the two issues identified for the first phase, the trial judge answered no to both questions. She gave lengthy, detailed and complex reasons for judgment. The trial judge found in favour of Grassy Narrows on every crucial issue. In particular, she found that in the Keewatin lands, Ontario could not take up land so as to limit harvesting rights without first obtaining Canada's approval.

[12] The parties have radically different views as to what are the trial judge's findings of fact. The appellants attack all of what they view as her significant findings of fact and conclusions of law.

Parties and intervenors on appeal

[13] On appeal, there are ten different parties or sets of parties: three appellants, two intervenors with party status, four other intervenors and the respondents.

[14] The first two appellants are Ontario and the Attorney General of Canada ("Canada"). Canada was added below as a third party to the litigation.

[15] The third appellant is Abitibi, which changed its name to Resolute FP Canada Inc. in May 2012. It owns and operates a paper mill in the Treaty 3 area. It surrendered its Whiskey Jack forestry licence -- the licence that gave rise to these proceedings -- shortly after the company was granted protection under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36 in 2009. While the company initially participated in the trial, it withdrew in November 2009 as it focused on its reorganization. It is common ground, however, that the issues raised on this appeal remain alive and require resolution.

[16] Goldcorp Inc. was granted party intervenor status on these appeals. Its Red Lake gold mine is the largest gold mine in Canada. It is located within the Keewatin lands and its operations depend on licences issued by Ontario. Goldcorp supports the appellants' position.

[17] Leslie Cameron, acting on behalf of himself and the Wabauskang First Nation ("Wabauskang"), was also granted party intervenor status. Wabauskang's traditional territory includes lands within the Keewatin lands. [page408]

[18] Grand Council of Treaty 3 describes itself as the traditional, historic governing body and political organization charged with advancing and protecting the Anishinaabe Nation's rights and interests in Treaty 3 territory. It is composed of the leaders of the 28 communities of the Anishinaabe Nation in Treaty 3 who meet as the Chiefs in Assembly of the Grand Council. The 28 communities have reserve lands across Treaty 3 territory, mostly south of the Keewatin lands. The Grand Council participated in the appeals as an intervenor.

[19] Five Treaty 3 First Nations with reserves and traditional territories south of the English River in the so-called "disputed territory" also participated in these appeals as intervenors: Big Grassy First Nation, Naotkamegwanning First Nation, Ochiichagwe'babigo'ining Ojibway Nation, Ojibways of Onigaming First Nation and Shoal Lake #40 First Nation (the "Big Grassy intervenors").

[20] Lac Seul First Nation ("Lac Seul") is also a Treaty 3 First Nation. Its traditional territory includes portions of the Keewatin lands. It too participated as an intervenor.

[21] Finally, a number of Treaty 6 First Nations were granted intervenor status: Ermineskin Cree Nation, Muskeg Lake Cree Nation #102, Whitefish (Goodfish) Lake First Nation #128 and Samson Cree Nation (the "Treaty 6 intervenors"). Treaty No. 6 between Her Majesty the Queen and the Plain and Wood Cree Indians and the other Tribes of Indians at Fort Carlton, Fort Pitt and Battle River with Adhesions ("Treaty 6"), which covers large tracts of land in central Alberta and Saskatchewan, contains a similar harvesting clause to that of Treaty 3.

[22] The First Nations intervenors support the respondents' position that the trial judge correctly answered the two threshold questions.

Outcome of the appeals

[23] For the following reasons, we conclude that the trial judge made many errors and that these appeals must be allowed. We propose to begin with a summary of the facts, to identify the trial judge's key factual findings and legal conclusions, and then to explain our reasons for concluding that the trial judge's central findings and conclusions cannot stand. It is neither necessary nor desirable for us to canvass all of the issues and arguments that were raised; we have chosen to focus on what we perceive to be the truly dispositive aspects of this case. [page409]

B. Facts

The Keewatin lands

[24] The trial judge devoted a substantial part of her decision to the history of Treaty 3. We will not repeat or review those efforts here. Rather, we recount only those historical facts necessary to understand the context within which Treaty 3 came into being and the political realities that characterized the early years of its existence.

[25] Grassy Narrows' claim relates to an area called the Keewatin lands. In 1873, the Keewatin lands were within the District of Keewatin, a federal territory. They became part of the Province of Ontario when Ontario and Canada passed reciprocal legislation in 1912: Ontario Boundaries Extension Act, 1912 (C.A.), 2 Geo. V, c. 40; An Act to express the Consent of the Legislative Assembly of the Province of Ontario to an Extension of the Limits of the Province (ON), 2 Geo V., c. 3 (together, the "1912 legislation").

[26] The Keewatin lands constitute only a portion of the lands covered by Treaty 3. The rest of the Treaty 3 lands that now fall within Ontario are referred to in this case as the "disputed territory". The Disputed Territory was the subject of a boundary dispute between Ontario and the federal government. We provide details of that dispute and its resolution below.

The negotiation of Treaty 3

[27] Prior to any treaty negotiations in the area covered by Treaty 3, Canada had begun to build an immigrant travel route -- the Dawson Route -- to move settlers westward across Treaty 3 lands and waters. In 1871, to induce British Columbia to join Confederation, Canada promised to build a transcontinental railroad that would also cross the Treaty 3 territory.

[28] In 1871 and 1872, Canada sent treaty commissioners to negotiate with the Treaty 3 chiefs, but they were unable to conclude a treaty.

[29] By 1872, the Dawson Route was open and settlers were crossing through the Treaty 3 territory heading West. By 1873, Canada was concerned about the security of travellers over the Dawson Route and surveyors preparing for the construction of the Canadian Pacific Railway ("CPR"). Canada feared it would have to incur the costs of stationing troops in the area. The deadline for completing the CPR between the Red River and Lake Superior was December 31, 1876.

[30] In 1873, Canada renewed its efforts to negotiate a treaty. Three treaty commissioners were appointed. [page410]

[31] The first was Alexander Morris, a founder of Confederation and a political ally of Sir John A. Macdonald. He served as a federal cabinet member and briefly as a judge before his appointment as Lieutenant-Governor of Manitoba and the North-West Territories. He subsequently played a leading role in the negotiation of Treaties 3, 4, 5 and 6.

[32] The second commissioner was Joseph Provencher, a federal Indian agent.

[33] The third commissioner was Simon Dawson, who had supervised the construction of the Dawson Route. He had also been involved in an earlier exploratory expedition through Treaty 3 lands and earlier treaty negotiations with the Ojibway.

[34] The commissioners were authorized, on behalf of the Crown in right of Canada, "to negotiate, make and conclude with the several bands or tribes of Indians the necessary Treaties for the cession to us, our heirs and successors, of all and every their respective rights, titles, and claims to and in the said lands and every of them".

[35] All chiefs from the Treaty 3 area were present and participated in the treaty negotiations. Three were selected as spokespersons. The chiefs were accompanied by an Aboriginal reporter whose duty was to commit to memory all that was said as well as Joseph Nolin, a Métis who was to take notes of the negotiations in French.

[36] The 1873 negotiations, which resulted in the making of Treaty 3, were very well recorded as reflected by the documents that were in evidence at trial:

-- the formal English-language treaty signed by the parties;

-- Morris' official report on the making of the treaty dated October 14, 1873;

-- a record of discussions taken by a shorthand reporter, as subsequently published in The Manitoban newspaper (although the original notes of the reporter are not available);

-- handwritten notes made during the treaty negotiations that are generally accepted to be Dawson's notes;

-- an English translation of the notes made by Nolin, which were attached to Morris' report;

-- a document recording a written list of treaty demands dated January 22, 1869 apparently drafted on behalf of a group of Ojibway chiefs; and

-- a record of negotiations published in The Manitoba Free Press. [page411]

[37] The parties to this litigation were not able to identify Ojibway elders with relevant oral traditions.

The 1873 negotiations

[38] The commissioners arrived at the North-West Angle of the Lake of the Woods in late September 1873 along with an entourage and a contingent of troops sent to add to the pomp of military display. The entourage included two Métis who acted as cultural intermediaries and translators: James McKay and George McPherson.

[39] Negotiations were deferred for a number of days as the chiefs were not ready to proceed. The parties gathered on September 30 and negotiations began in earnest on October 1, 1873.

[40] Throughout the negotiations, the commissioners referred to the Queen, emphasizing that they represented her. They also made reference to the Queen's government, which Morris referred to as being located in Ottawa, and to authorities in Ottawa.

[41] Morris' October 1 proposal to the chiefs included initial and annual monetary payments, goods, provisions and the offer to establish schools and reserves.

[42] According to two accounts of the negotiations (as found in The Manitoban and in Dawson's notes), Morris' reference on October 1 to "reserves" was followed by a reference to hunting and fishing.

[43] The Manitoban recorded that Morris stated that "[i]t may be a long time before the other lands [outside the reserves] are wanted, and in the meantime" the First Nations would "be permitted to hunt and fish over them".

[44] Similarly, Dawson's notes record Morris' statement as: "It may be a long time before the other lands are wanted and you will have the right to hunt and fish over them until white man wants them."

[45] The Ojibway responded to Morris' proposal by saying that they would retire to discuss the offer among themselves. Negotiations were thus adjourned to the next day.

[46] On October 2, the Ojibway presented a lengthy list of demands. The list included monetary and other terms that were much more generous than those offered by Morris.

[47] The chiefs pressed their demands throughout the day and Morris rejected them. A turning point in the negotiations came towards the end of the day when Chief Sah-katch-eway of Lac Seul stepped forward and indicated a willingness to make a deal.

[48] Negotiations were again adjourned and Ojibway representatives held a council through the evening of October 2 and [page412] into the morning of October 3. Nolin and McKay were among those who attended the council.

[49] Chief Manitobiness opened the negotiations on October 3 by inviting Morris to present his best offer. Morris presented additional and improved terms to which the commissioners had agreed among themselves, including agricultural implements, fishing nets, twine and an increase in the monetary terms.

[50] The Ojibway negotiators proceeded to raise additional issues, which the commissioners responded to in turn.

[51] According to The Manitoban, the Ojibway demanded that "[w]e must have the privilege of travelling about the country where it is vacant". James McKay is reported in The Manitoban as saying, "Of course, I told them so."

[52] Dawson's notes similarly record that there was a request that the Ojibway have "the privilege of travelling through the country". The response is simply recorded as "yes".

[53] The entry in Nolin's notes records that McKay stated: "The Indians will be free, as by the past, for their hunting and rice harvest."

[54] Following negotiations on each of the many points raised by the Ojibway, Treaty 3 was concluded and signed on behalf of the parties. The text of Treaty 3 is included at Appendix A.

Boundary dispute

[55] Treaty 3 was negotiated amidst controversy over the location of Ontario's western and northern boundaries. At the time Treaty 3 was negotiated, the federal government's position was that all of the Treaty 3 lands were in the North-West Territories or Manitoba, under the administration and control of the Dominion of Canada. Ontario took the position that its boundaries extended to the west of its current boundary, taking in much of what became Treaty 3 lands.

[56] The boundary dispute was lengthy and at times acrimonious, with Premier Oliver Mowat fighting to defend Ontario's position and Prime Minister John A. Macdonald refusing to back down.

[57] The relationship between the federal government and Ontario softened after Prime Minister Macdonald was forced to resign in November 1873 as a result of a political scandal.

[58] Alexander Mackenzie's Liberal government came to power in January 1874.

[59] With a more conciliatory Liberal government in Ottawa and a Liberal government in Ontario, in June 1874 the two sides agreed to resolve the boundary dispute through arbitration and [page413] reached a provisional boundary agreement to provide legal certainty for development in the disputed area.

[60] The provisional boundary ran north-south through the eastern part of the Treaty 3 area.

[61] Under the 1874 provisional boundary agreement, it was agreed that for lands within the disputed territory to the east and south of the provisional boundary, Ontario would grant patents; to the west and north, Canada would grant patents. If it were subsequently found that these lands were not in Ontario or federal territory, the applicable government would ratify the patents issued by the other government and account for the proceeds of such lands.

[62] Ontario's position in the boundary dispute was accepted in August 1878 by a panel of arbitrators, resulting in most of the Treaty 3 area being in Ontario.

[63] However, matters changed with Macdonald's return to power in October 1878. He refused to honour the arbitration decision.

[64] The Ontario boundary dispute case was heard by the Judicial Committee of the Privy Council in 1884, which essentially endorsed the 1878 arbitrators' ruling. Ontario's original boundaries, as determined by the Privy Council in 1884, were not confirmed by Imperial legislation until 1889: Canada (Ontario Boundary) Act, 1889 (U.K.), 52-53 Vict., c. 28.

[65] In the meantime, despite the Privy Council's decision, Prime Minister Macdonald continued to assert Canada's administration and control over the entire Treaty 3 lands. The federal government took the position that, because it had obtained the surrender of the Aboriginal title in Treaty 3, Canada was the owner of the Crown lands in the territory of Treaty 3. Ontario strongly contested that claim and asserted that the province was entitled to the beneficial ownership of the lands pursuant to the Constitution Act, 1867, s. 109. As is discussed later in these reasons, s. 109 gives Ontario beneficial ownership of Crown lands within the borders of Ontario, subject to any trust or other interest in those lands, including existing Aboriginal interests.

[66] Canada issued timber permits that Ontario challenged. The dispute led to the Privy Council's 1888 decision in St. Catherine's Milling and Lumber Co. v. Ontario, 1888 CanLII 209 (UK JCPC), [1888] J.C.J. No. 1, 14 App. Cas. 46 (P.C.), affg (1887), 1887 CanLII 3 (SCC), 13 S.C.R. 577, [1887] S.C.J. No. 3, affg 1886 CanLII 30 (ON CA), [1886] O.J. No. 108, 13 O.A.R. 148 (C.A.), affg (1885), 1885 CanLII 288 (ON SC), 10 O.R. 196 (Ch. Div.). The Privy Council decided in Ontario's favour. It struck down the federal timber licence, upheld Ontario's s. 109 claim and held that the province had exclusive [page414] power to authorize forestry on off-reserve Treaty 3 lands in the province.

[67] Negotiations from 1889 to 1891 between Canada and Ontario culminated in reciprocal legislation: An Act for the settlement of certain questions between the Governments of Canada and Ontario respecting Indian Lands (C.A.), 54 & 55 Vict., c. 5; An Act for the settlement of questions between the Governments of Canada and Ontario respecting Indian Lands (ON), 54 Vict., c. 3 (the "1891 legislation"). It dealt with the selection and confirmation by Ontario of Treaty 3 reserves and confirmed Ontario's authority to take up Treaty 3 surrendered lands situated within its boundaries. The 1891 legislation included a Schedule, containing a draft agreement addressing the two issues. The draft agreement was executed by both governments in 1894 (the "1894 agreement").

[68] Article 1 of the 1894 agreement provides that with respect to lands "taken up for settlement, mining, lumbering or other purposes . . . it is hereby conceded and declared" that as the lands belong to Ontario, the Indian harvesting rights "do not continue with reference to any tracts which have been, or from time to time may be, required to be taken up for settlement, mining, lumbering or other purposes by the Government of Ontario or persons duly Authorized by the said Government of Ontario".

[69] Ontario's boundaries (as well as Quebec's and Manitoba's) were again extended by reciprocal legislation passed by Canada and Ontario in 1912. The 1912 legislation extended Ontario's boundaries to include the Keewatin lands.

[70] The 1912 legislation did not expressly allow Ontario to "take up" lands in Keewatin.

[71] Apart from projects falling within federal jurisdiction (such as inter-provincial railways, harbours, national parks, etc.), development, patenting and leasing of Crown lands in the Treaty 3 area have been exclusively authorized by Ontario -- in the disputed territory since the late 1880s and in the Keewatin lands since 1912.

C. The Trial Judge's Decision

Answer to question one

Interpretation of the harvesting clause

[72] The trial judge reviewed the history leading up to Treaty 3 at great length. She emphasized the fact that Canada needed the Treaty more than the Ojibway. Canada had obtained British Columbia's assent to enter Confederation on the promise of [page415] building the CPR railway. Securing a safe route through the traditional Ojibway hunting and fishing lands for the railway and for the expected influx of settlers was vital for the accession of British Columbia to Confederation and for the development of the West. Two previous attempts to secure a treaty had failed and Canada knew that, once again in 1873, the Ojibway could walk away from the negotiations without reaching an agreement.

[73] The trial judge found that the relationship with the Queen's Government at Ottawa was important to the Ojibway and that they relied on the Ottawa government to implement and enforce the treaty promises made by the Crown.

[74] The trial judge also found that both Morris, who was Canada's principal commissioner at the Treaty 3 negotiations, and Canada believed that it was pivotal that the Ojibway should remain content while the railroad was being built and while the settlers crossed the Dawson Route to the west.

[75] She further found that Morris was aware of the boundary dispute with Ontario and that to ensure that in the event Ontario was successful in asserting its claim to the disputed territory, Morris deliberately tailored the wording of the harvesting clause to ensure that the Government of the Dominion of Canada could maintain a protective role. In her view, Morris intended to ensure that Canada could stand between Ontario and the Ojibway, where necessary, to police Ontario's taking up of lands pursuant to s. 109 so as to preserve and protect the Ojibway harvesting rights. This assertion of federal authority, she held, was a proper exercise of Canada's jurisdiction under s. 91, para. 24 of the Constitution Act, 1867 over "Indians, and Lands reserved for the Indians".

[76] In her lengthy judgment, the trial judge formulates her findings on the issue of the proper meaning and interpretation of the harvesting clause in different places and in different language. We believe, however, that her central finding is best summarized at para. 1452:

In Keewatin, Ontario does not have the right to limit Treaty Rights by "taking up lands under the Treaty." It can issue land authorizations under s. 109 apart from the Treaty, but only in compliance with s. 109, i.e., only so long as the authorizations do not have the effect of substantially interfering with Treaty Harvesting Rights. To authorize uses that significantly interfere with Treaty Harvesting Rights under the Treaty, Ontario, or users of land already authorized by Ontario to use the land, must also obtain the authorization of Canada.

(Emphasis in original) [page416]

[77] At the hearing of the appeals, much argument was devoted to the trial judge's findings of fact relating to the scope of the taking up power under the harvesting clause. The parties spent a great deal of time reviewing the evidence that pertains to that issue. It was striking that the parties disagreed not only about what factual issues were in dispute, but also about what the trial judge's findings of fact were.

[78] This is perhaps understandable given the length of the trial judge's reasons -- some 1651 paragraphs. In her reasons, the trial judge addressed the factual and legal issues at various points and in various ways. As a result, it is possible for the reader to focus on a passage from a section addressing one issue, and erroneously read the passage as making a significant finding about a different issue.

[79] A major cause of the lack of consensus about the trial judge's findings is the fact that much of the trial judge's discussion of what lands could be "taken up" is compounded with her view that Ontario could not exercise the treaty partner's right to "take up" lands without Canada's approval. At some points in her judgment, the trial judge uses "taking up" to describe what she considered to be Ontario's improper unilateral exercise of its s. 109 powers as amounting to using the treaty lands in a way that is incompatible with the exercise of harvesting rights. In large part, this flows from her view that Ontario could not properly authorize the use of treaty lands for the purposes specified in the taking up clause, namely, "settlement, mining, lumbering or other purposes", without Canada's approval. On the other hand, in other passages she uses "taking up" with reference to the proper exercise of the treaty partner's right reserved by the harvesting clause to commence using the lands. These two different uses of the term "taking up" must be kept in mind in understanding the trial judge's reasons.

[80] The parties failed to maintain this distinction in their submissions. In support of their contention that the trial judge's entire approach was fundamentally wrong, both Ontario and Canada made what might be described as a "straw man" argument. They submitted that the trial judge found that no government could significantly interfere with treaty harvesting activities throughout the treaty lands without breaching the treaty, except along the Dawson Route and the CPR. In other words, the taking up clause could only be exercised in the Dawson Route and the CPR line corridors. Canada went so far as to raise doubt as to whether the trial judge even found that Treaty 3 represented a surrender of Treaty 3 territory, except in very limited areas. [page417]

[81] We do not agree with that interpretation of the trial judge's findings. While isolated passages in the reasons, read out of context, could be read to support that view, in the final analysis, we agree with the respondents that when her reasons are read as a whole in the context of the evidence and the pleadings, the trial judge made no such finding.

[82] In para. 924, the trial judge summed up her findings:

For all the reasons detailed within these Reasons, I have found that in the Treaty 3 area, the Commissioners promised more than a continuation of the right to hunt anywhere within their traditional territories. Away from the vicinity of the Dawson Route and the CPR, they intended that Ojibway Harvesting Rights would not be significantly interfered without the authorization of Canada. They would continue throughout the Treaty 3 lands "as long as the sun shone and the waters flowed."

(Underlining in original; italics added)

[83] As counsel for the respondents pointed out, the trial judge made clear in this passage that with Canada's authorization, the taking up clause could be used to limit harvesting rights outside of the Dawson Route and the CPR corridor.

[84] Paragraph 1280 also demonstrates that the trial judge's finding as to the scope and effect of the "taking up" clause is confounded with her view that Ontario could not exercise the taking up power without Canada's approval. She said:

The Clause as written contemplates on its face that subjects of the Dominion may be authorized by Canada to "take up" lands under the Treaty/to use lands in a manner visibly incompatible with Harvesting Rights. Where Canada is not the owner of the land, the words of the Treaty on their face contemplate a two-step approval process in the event that land uses threaten to interfere with Harvesting Rights: (1) authorization to use the land from the owner of the land; and (2) additional authorization from Canada.

[85] The underlining of "by Canada" is the trial judge's. A few paragraphs later, in para. 1286, she said:

In my view, the plain and literal wording of the Treaty is that the Ojibway will have unlimited Harvesting Rights throughout the tract surrendered, i.e., over all the ceded territory, off-reserve as well as on-reserve, unless the process specified in the Treaty is followed. The Ojibway are entitled to exercise their Harvesting Rights unless Canada has authorized their limitation or extinguishment.

(Underlining in original; italics added)

[86] Paragraph 1310 again shows that the trial judge did not interpret the treaty so that the right to take up lands was restricted to the Dawson Route and the CPR line, provided that Canada authorized the taking up. She said: [page418]

After having considered all the evidence and the various interpretations of common intention, the one that best reconciles the interests of both parties at the time the Treaty was signed, the chosen interpretation is that Canada promised continuous Harvesting Rights without significant interference away from the Dawson Route and CPR right-of-way and the Ojibway relied upon Canada and only Canada to implement and enforce those Rights. Canada intended that in the event it lost the Boundary Dispute, Ontario would not be able to "take up" lands/authorize any land uses that would significantly interfere with Harvesting Rights unless Canada also authorized such "taking up."

[87] Again, the underlining is the trial judge's. In our view, the trial judge's finding is that, provided Canada approves, "taking up" may involve land uses that would limit harvesting rights throughout the entire area of Treaty 3.

[88] We note as well that the respondents did not raise any issue regarding Ontario's ability to take up lands under Treaty 3 with federal authorization in their pleadings. Quite the contrary, in discovery admissions that were read in at trial respondents' counsel stated that lands could be validly taken up under Treaty 3 if federal authorization were in place.

[89] We conclude that when her reasons are properly read as a whole, the trial judge found that the taking up clause, which imposed a two-step process involving the approval of Canada for the lands added to Ontario in 1912, permitted lands throughout the entire Treaty 3 area to be taken up, subject only to the legal limits imposed by virtue of the honour of the Crown and the rights protected by s. 35 of the Constitution Act, 1982. As we explain below, these limits were definitively explained by the Supreme Court of Canada in Mikisew Cree First Nation v. Canada (Minister of Canadian Heritage), [2005] 3 S.C.R. 388, [2005] S.C.J. No. 71, 2005 SCC 69.

The 1891 legislation, the 1894 agreement and the 1912 legislation

[90] In answering question one, the trial judge found that the effect of the 1891 legislation and the 1894 agreement was limited to the disputed territory. She found, at para. 1455, that with respect to the disputed territory, "Canada bargained away its control over Ojibway Harvesting Rights on lands 'taken up' by Ontario in the Disputed Territory" and that the legislation amended the treaty "in that respect". In other words, she found that Ontario could take up land in the disputed territory unilaterally, thereby affecting harvesting rights on that land.

[91] However, she found that neither the 1891 nor the 1912 legislation affected Treaty 3 harvesting rights in the Keewatin lands, essentially on the ground that the 1912 legislation did [page419] not clearly reveal an intention to alter the Treaty harvesting rights and specifically mentioned the federal government's continuing trusteeship obligations to the First Nations in the area.

[92] The trial judge thus concluded that the answer to question one was no.

Answer to question two

[93] Having answered question one no, the trial judge proceeded to question two. She concluded that, pursuant to the division of powers between Parliament and the legislatures under the Constitution Act, 1867, Ontario does not have the authority to justifiably infringe the rights of the plaintiffs to hunt and fish as provided for in Treaty 3. To arrive at that conclusion, trial judge applied the doctrine of inter-jurisdictional immunity. That doctrine protects the core of a limited number of federal heads of power, including s. 91, para. 24, from impairment by provincial laws. The trial judge found that treaty harvesting rights are at the core of the federal s. 91, para. 24 jurisdiction over "Indians, and Lands reserved for the Indians", and that it followed that a province, in the exercise of its s. 109 proprietary rights, cannot infringe those rights, even if the infringement can be justified under the legal test a government must satisfy to justify an interference with a right protected by s. 35: see R. v. Sparrow, 1990 CanLII 104 (SCC), [1990] 1 S.C.R. 1075, [1990] S.C.J. No. 49.

D. Parties' Positions

[94] The appellants and Goldcorp submit that the trial judge's findings and legal conclusions on question one are unsupported by and contrary to the evidence, contrary to established law on Treaty 3 and the respective rights of Canada and Ontario over the surrendered lands, contrary to established principles of treaty interpretation, contrary to settled law on taking up lands under harvesting clauses, contrary to basic principles of the Canadian Constitution and contrary to the doctrine of devolution with respect to obligations owed by the Crown.

[95] The appellants and Goldcorp submit that the trial judge's interpretation of the 1891 and 1912 legislation is fundamentally wrong and leads to an inconsistent and incoherent result whereby one part of the Treaty 3 lands (the disputed territory) fall under one legal regime, and the other part (the Keewatin lands, which were added in 1912) falls under a different regime. Ontario contends that, properly read in accordance with principles of statutory interpretation, the 1891 legislation does apply to the Keewatin lands, and that, in any event, as submitted by [page420] Canada, the 1912 legislation brought the Keewatin lands within the scope of Ontario's s. 109 rights.

[96] More generally, Ontario's position in this litigation is that it is bound by the significant limits the courts have placed on the Crown's ability to take up lands pursuant to the honour of the Crown and s. 35, as detailed in Mikisew. Ontario accepts that when contemplating land use authorizations or dispositions that may adversely affect Treaty 3 harvesting rights, it is constitutionally required to consult the affected persons and, where appropriate, accommodate those rights to ensure that each Treaty 3 First Nation has a meaningful ability to exercise its harvesting rights.

[97] With respect to the trial judge's answer to question two, the appellants and Goldcorp submit that inter-jurisdictional immunity has no application and that a long line of cases from the Privy Council and the Supreme Court of Canada makes it clear that the exercise of Ontario's proprietary rights conferred by s. 109 are not rendered inoperative or ineffective by Canada's s. 91, para. 24 legislative head of power.

[98] The First Nations intervenors support the trial judge's ultimate conclusions on questions one and two. However, they raise a number of issues that we propose to deal with below. In particular, they have asked this court to conclude that the trial judge's findings as to the effect of the 1894 agreement outside of the Keewatin lands and her comments concerning the legal status of the Treaty 3 reserves before 1915 were obiter. They also challenge her comments with respect to the "extinguishment" of Treaty 3 harvesting rights outside of the Keewatin lands.

E. Issues

[99] In the first part of our analysis, which is set out below, we deal with issues relating to question one. Specifically, we propose to answer the following:

(1) Did the trial judge err in holding that Ontario cannot authorize the taking up of land in the Keewatin lands, within the meaning of the harvesting clause, without Canada's approval or permission?

(2) Did the trial judge err in her interpretation of the 1891 legislation, the 1894 agreement and the 1912 legislation?

(3) Does Ontario's use of the taking up clause, short of infringement, engage s. 91, para. 24? [page421]

[100] In the second part of our analysis, we deal with issues that arise from question two, specifically:

(1) Does inter-jurisdictional immunity apply and can Ontario resort to a Sparrow justification?

F. Analysis

Issues related to question one

1. Did the trial judge err in holding that Ontario cannot authorize the taking up of land in the Keewatin lands, within the meaning of the harvesting clause, without Canada's approval or permission?

[101] We propose to consider this issue in three stages. First, we will consider whether the trial judge's interpretation of the harvesting clause is consistent with governing constitutional provisions and principles. Then we will consider whether the text of the harvesting clause supports her interpretation. Finally, we will consider whether her factual findings bearing upon this issue can survive scrutiny.

Constitutional provisions

[102] The harvesting clause has to be interpreted within the constitutional framework established by the Constitution Act, 1867, the case law elaborating those provisions and other relevant constitutional principles.

[103] Canada's constitutional order divides legislative authority between Canada and the provinces and extends certain protections to Aboriginal and treaty rights.

[104] The Constitution Act, 1867, s. 91, para. 24 gives Canada exclusive legislative authority over "Indians, and Lands reserved for the Indians". It is common ground that Canada negotiated Treaty 3 pursuant to the power conferred by s. 91, para. 24.

[105] Aboriginal and treaty rights "existing" in 1982 enjoy constitutional protection by virtue of the Constitution Act, 1982, s. 35:

35(1) The existing aboriginal and treaty rights of the aboriginal peoples of Canada are hereby recognized and affirmed.

[106] The Constitution Act, 1867, s. 109 gives Ontario beneficial ownership of Crown lands within the borders of Ontario, subject to any trust or other interest in those lands, including existing Aboriginal interests:

109. All Lands, Mines, Minerals, and Royalties belonging to the several Provinces of Canada, Nova Scotia, and New Brunswick at the Union, and all [page422] Sums then due or payable for such Lands, Mines, Minerals, or Royalties, shall belong to the several Provinces of Ontario, Quebec, Nova Scotia, and New Brunswick in which the same are situate or arise, subject to any Trusts existing in respect thereof, and to any Interest other than that of the Province in the same.

[107] Ontario also has exclusive legislative jurisdiction to manage and sell public lands belonging to the province by virtue of s. 92, para. 5:

92. In each Province the Legislature may exclusively make Laws in relation to Matters coming within the Classes of Subjects next hereinafter enumerated; that is to say,

93. The Management and Sale of the Public Lands belonging to the Province and of the Timber and Wood thereon.

[108] By virtue of s. 109, Ontario beneficially owns the public lands governed by Treaty 3 situated within its borders, and by virtue of s. 92, para. 5, Ontario has exclusive legislative authority to manage and sell those public lands.

[109] Additional powers with respect to non-renewable natural resources, forestry resources and electrical energy are conferred on the provinces by s. 92A:

92A(1) In each province, the legislature may exclusively make laws in relation to

(a) exploration for non-renewable natural resources in the province;

(b) development, conservation and management of non-renewable natural resources and forestry resources in the province, including laws in relation to the rate of primary production therefrom; and

(c) development, conservation and management of sites and facilities in the province for the generation and production of electrical energy.

[110] The taking up of public lands in Ontario for provincial purposes occurs pursuant to ss. 109, 92, para. 5 and 92A, by which forestry, mining, settlement and other land uses within provincial jurisdiction are authorized. The federal government also has a residual ability to take up lands for federal purposes under federal heads of power (e.g., the establishment of national parks, railways, harbours, airports, military bases, etc.).

[111] As will become clear from the discussion that follows, Ontario's beneficial ownership, combined with the exclusive legislative authority to manage and sell the lands, embraces the things that would amount to taking up lands governed by Treaty 3 "for settlement, mining, lumbering or other purposes", including in the Keewatin lands. [page423]

Case law

[112] The Privy Council considered the allocation of constitutional authority to Ontario and Canada applicable to the taking up of lands governed by Treaty 3 in St. Catherine's Milling. In that case, Ontario challenged the validity of a licence issued by Canada to the St. Catherine's Milling and Lumber Company to cut timber on public lands within the area governed by Treaty 3. Canada took the position that as the lands had been ceded to Canada under the treaty, Canada enjoyed the beneficial ownership of the lands and, with ownership, the right to administer the lands.

[113] The Privy Council rejected that contention and ruled that the treaty was between the Indians and the Crown, not Canada, and that by virtue of s. 109, beneficial ownership in the lands and the right to administer and profit from the lands by issuing timber licences belonged exclusively to Ontario.

[114] St. Catherine's Milling involved the disputed territory portion of the Treaty 3 lands. By the time the case was heard, the boundary dispute had been resolved in Ontario's favour. While the specific focus of the case was the validity of a timber licence, the Privy Council recognized, at p. 53 App. Cas., that the "decision necessarily involves the determination of the larger question between that government [Canada] and the province of Ontario with respect to the legal consequences of the treaty of 1873".

[115] Lord Watson traced the history of the relationship between Aboriginal people and the Crown from the Royal Proclamation, 1763, and outlined the protective role assumed by the Crown in relation to dealings in Indian lands. He did not find it necessary to define "the precise quality of the Indian right" but held, at p. 55 App. Cas., that from the date of the Royal Proclamation, there was "vested in the Crown a substantial and paramount estate, underlying the Indian title, which became a plenum dominium whenever that title was surrendered or otherwise extinguished".

[116] The nature and character of the Indian interest in the lands did not change until that interest was surrendered by the treaty: p. 55 App. Cas. The Crown had at all times what Lord Watson described, at p. 58 App. Cas., as "a present proprietary estate in the land, upon which the Indian title was a mere burden". The underlying legal estate remained vested in the Crown, but beneficial ownership, including "all revenues derived from [lands] being taken up for settlement, mining, lumbering and other purposes" devolved to the Province of Canada when it [page424] was created in 1840: p. 55 App. Cas. As Lord Watson went on to explain, the beneficial ownership subsequently passed to Ontario at Confederation in 1867 pursuant to s. 109.

[117] That constitutional provision, said Lord Watson, at p. 57 App. Cas., was "sufficient to give each Province, subject to the administration and control of its own Legislature, the entire beneficial interest of the Crown in all lands within its boundaries" vested in the Crown at the time of union, excepts lands vested under the Constitution Act, 1867, s. 108 (public works and property specifically enumerated in Sch. 3) and s. 117 (property required for national defence). By virtue of the terms of s. 109, Ontario's beneficial interest is "subject to any Trusts existing in respect thereof, and to any Interest other than that of the Province in the same". Those words embrace the burden of the Indian title or, following cession of that title, treaty rights with respect to the lands.

[118] The Privy Council rejected Canada's argument that the power to make laws for "Indians, and Lands reserved for the Indians" conferred by s. 91, para. 24 gave Canada any patrimonial interest the Crown had in the lands reserved for Indian occupation by virtue of the Royal Proclamation. As Lord Watson put it, at p. 59 App. Cas., "the power of legislating for Indians, and for lands which are reserved to their use . . . is not in the least degree inconsistent with the right of the Provinces to a beneficial interest in these lands, available to them as a source of revenue whenever the estate of the Crown is disencumbered of the Indian title".

[119] The Privy Council rejected Canada's contention that Treaty 3 amounted to an agreement or conveyance between the Indians and the Government of Canada. The treaty, said Lord Watson, at p. 60 App. Cas., was according to its very terms "a transaction between the Indians and the Crown". The commissioners who negotiated the treaty were appointed by the Dominion of Canada and they had full authority to represent the Crown and to accept a surrender of the Indian title to the Crown, but they had "neither authority nor power to take away from Ontario the interest which had been assigned to that province" by the Constitution Act, 1867.

[120] Lord Watson stated, at p. 60 App. Cas., that Canada's "exclusive power to regulate the Indians' privilege of hunting and fishing" did not extend to confer upon Canada the "power to dispose, by issuing permits or otherwise, of that beneficial interest in the timber which has now passed to Ontario". Simply put, once the beneficial interest in the lands passed to Ontario by virtue of s. 109, Canada lost the right to "take up" the lands. [page425]

[121] The respondents place heavy reliance on the concluding passage in Lord Watson's opinion, at p. 60 App. Cas.:

There may be other questions behind, with respect to the right to determine to what extent, and at what periods, the disputed territory, over which the Indians still exercise their avocations of hunting and fishing, is to be taken up for settlement or other purposes, but none of these questions are raised for decision in the present suit.

[122] The trial judge accepted the respondents' argument that Lord Watson's reference to remaining and undecided "questions behind" regarding the reconciliation of the Aboriginal harvesting right and the taking up of lands left open the issue of whether federal approval was required to take up lands: see, especially, at para. 1340.

[123] We are unable to agree with that interpretation of Lord Watson's dictum. St. Catherine's Milling resolved a very hard fought battle between Canada and Ontario over valuable resources -- which level of government had the right to profit from the resources and which level of government had the right to control the development and management of those resources. The Privy Council categorically denied Canada's claim and clearly affirmed Ontario's full jurisdiction to take up lands for development. Canada's jurisdiction to legislate in relation to [at para. 13] "Indians, and Lands reserved for the Indians" was said to be [at para. 14] "not in the least degree inconsistent" (emphasis added) with Ontario's right to manage and benefit from the lands.

[124] In our view, it is simply inconceivable that Lord Watson could have intended to leave dangling the possibility of a residue of federal authority that would unsettle the very question he had decided. The more plausible interpretation of the dictum is that the "other questions behind" referred to the reconciliation of the Aboriginal harvesting right with the development of the lands, the issue that was ultimately dealt with by the Supreme Court of Canada in Mikisew.

[125] Treaty 3 was again considered by the Privy Council in Dominion of Canada v. Province of Ontario, 1910 CanLII 466 (UK JCPC), [1910] J.C.J. No. 1, [1910] A.C. 637 (P.C.) (the "Annuities Case"), where Canada asserted a claim against Ontario for indemnity for the payments made to the Ojibway by Canada under Treaty 3. Relying on a comment by Lord Watson in St. Catherine's Milling, Canada argued that having obtained beneficial ownership of the lands ceded, Ontario was obliged to indemnify Canada for the payments made in exchange for the cession. The Privy Council's decision rejecting Canada's claim rests on two foundational pillars. [page426]

[126] First, as stated in St. Catherine's Milling, Treaty 3 is between the Ojibway and the Crown.

[127] Second, in relation to the Crown's benefits and burdens arising under the treaty, the two levels of government "were separately invested by the Crown with its rights and responsibilities as treaty maker and as owner respectively": p. 645 A.C. The Crown, said Lord Loreburn, at p. 645 A.C., "acts on the advice of ministers in making treaties, and in owning public lands holds them for the good of the community".

[128] The Privy Council held that there was no legal principle to ground Canada's claim. The burden and the benefit of the treaty rested with the Crown. The Dominion government, acting for the Crown under the authority conferred upon it by s. 91, para. 24, represented the Crown as treaty maker to achieve a great national purpose. The benefit Ontario derived, representing the Crown as beneficial owner by virtue of s. 109 of the Constitution, could not render the Government of Ontario liable to the Government of Canada.

[129] Turning to more recent case law, while the characterization of the legal nature of Aboriginal title in St. Catherine's Milling has been overtaken by Delgamuukw v. British Columbia, 1997 CanLII 302 (SCC), [1997] 3 S.C.R. 1010, [1997] S.C.J. No. 108, the authority of St. Catherine's Milling as to the operation of ss. 91, para. 24 and 109 has never been doubted.

[130] In Smith v. Canada, 1983 CanLII 134 (SCC), [1983] 1 S.C.R. 554, [1983] S.C.J. No. 39, Estey J. dealt with the relationship between s. 91, para. 24 and s. 109 of the Constitution Act, 1867. He affirmed St. Catherine's Milling, stating, at p. 562 S.C.R., that the "authority of that decision has never been challenged or indeed varied by interpretations and application". He confirmed the following principle from St. Catherine's Milling, at p. 562 S.C.R.:

The law therefore came to recognize the right and ability of the benefited Indians to give up their relationship to lands theretofore devoted to their use and occupation, and the result of such a process is the revival or restoration of the complete beneficial ownership in the Province without further burden by reason of s. 91(24).

(Emphasis added)

[131] Estey J. went on, at pp. 564-65 S.C.R., to refer to the statement of Street J., who rendered the Divisional Court decision in Ontario Mining Co. v. Seybold, as cited by the Privy Council in Seybold, 1902 CanLII 241 (UK JCPC), [1902] J.C.J. No. 2, [1903] A.C. 73, at p. 81 A.C.:

The Provincial Government could not without plain disregard of justice take advantage of the surrender and refuse to perform the condition attached to it; but it is equally plain that its ownership of the tract of land covered by [page427] the treaty was so complete as to exclude the Government of the Dominion from exercising any power or authority over it.

(Emphasis added)

[132] In our view, that statement is to be preferred over the dictum of Chancellor Boyd, the trial judge in Seybold [ (1899), 1899 CanLII 203 (ON SC), 31 O.R. 386, [1899] O.J. No. 113 (Ch. Div.)], which the respondents rely on to support their position that taking up involves both levels of government. Specifically, the respondents point to the following statement by Chancellor Boyd [at para. 36]:

The question is left open in the St. Catherine's Milling and Lumber Company case (1888), 14 A.C. 46, as to "other questions behind" i.e., with respect to the right to determine to what extent and at what periods the territory over which the Indians hunt and fish, is to be taken up for settlement and other purposes. I infer that these rights will be transacted by means of and upon the intervention of both general and local governments, although the central government may choose to deal ex parte with the Indians for the extinction of their claims to land. Still it appears preferable, for the sake of the Indians themselves, as well as for present and future peace, that the allocation of particular or treaty reserves as well as the sales of surrendered lands should be upon conference with the band and with the approval and co-operation of the Crown in its dual character as represented by the general and the provincial authorities.

(Emphasis added)

[133] Chancellor Boyd's statement -- the only judicial authority cited to us that implies the need for two levels of approval -- is inconsistent with St. Catherine's Milling and the Privy Council's statement just quoted in the appeal from Chancellor Boyd's judgment. In our view, Chancellor Boyd's statement does not assist the respondents.

[134] We conclude that the trial judge's finding that the commissioners who negotiated Treaty 3 qualified Ontario's constitutional rights and responsibilities by agreeing to a requirement that Canada interpose itself and approve the "taking up" of lands is fundamentally at odds with this established constitutional framework and cannot be sustained.

[135] The Ojibway's treaty partner is the Crown, not Canada. Canada is not a party to the treaty. The treaty promises are made by the Crown, not by a particular level of government. The Ojibway may look to the Crown to keep the treaty promises, but they must do so within the framework of the division of powers under the Constitution. As was specifically held in St. Catherine's Milling, Canada, Morris and the other commissioners who negotiated the treaty had no authority to depart from the Constitution's allocation of powers and responsibilities and no power to deprive Ontario of the beneficial [page428] ownership that devolved to the province when Ontario's borders were expanded.

Constitutional evolution

[136] The taking up clause also has to be interpreted in the light of the process of constitutional evolution from the time of the Royal Proclamation in 1763, to the creation of the Province of Canada in 1840, the creation of the Dominion of Canada and the Province of Ontario at Confederation in 1867, and finally, the extension of Ontario's border in 1912. Throughout that process of constitutional evolution, the Crown and the relationship between the Crown and Canada's Aboriginal peoples remains a constant, central and defining feature. What has evolved is the allocation of legislative and administrative powers and responsibilities to different levels of government. In formal terms, what changes with constitutional evolution is the level of government on whose advice the Crown acts.

[137] The principle of constitutional evolution has an important bearing upon treaties with First Nations. Treaties are solemn agreements and they are intended to last indefinitely. The rights they guarantee are not frozen in time: R. v. Marshall, 1999 CanLII 665 (SCC), [1999] 3 S.C.R. 456, [1999] S.C.J. No. 55; R. v. Bernard, [2005] 2 S.C.R. 220, [2005] S.C.J. No. 44, 2005 SCC 43, at para. 25. Treaties must be capable of adapting to the natural evolution of the Constitution, which evolves as a "living tree" to meet "the changing political and cultural realities of Canadian society": Canadian Western Bank v. Alberta, [2007] 2 S.C.R. 3, [2007] S.C.J. No. 22, 2007 SCC 22, at para. 23.

[138] As the English Court of Appeal explained in R. v. Secretary of State for Foreign and Commonwealth Affairs, ex parte Indian Association of Alberta, in relation to a challenge to proposals for constitutional change in 1982, if treaties are to be honoured by the Crown "so long as the sun rises and river flows", treaty interpretation has to evolve along with the Constitution: [1982] 2 All E.R. 118, [1982] Q.B. 892 (C.A.), at pp. 129-30 All E.R.

[139] The promise made in the harvesting clause is that of the Crown, not Canada. The two levels of government are "separately invested by the Crown with its rights and responsibilities as treaty maker and as owner respectively": Annuities Case, at p. 645 A.C. As Prime Minister Robert Borden stated in the House of Commons when explaining the effect of the 1912 legislation, the land is always vested in the Crown and the "only question is by whose advice shall that land be administered. . . . This land, like the rest of the land within the limits of Ontario, [page429] will be administered by the Crown on the advice of the provincial government": House of Commons Debates, 12th Parl., 1st Sess., No. 2 (February 27, 1912), at p. 3906.

[140] Responsibility for respecting the Crown's promises falls to be determined by the allocation of powers under the Constitution and the location of that responsibility evolves as the Constitution evolves. The Crown, acting on the advice of the Government of Ontario as the owner and administrator of the lands, is bound to keep the promise it made in the harvesting clause. When the beneficial title of the Keewatin lands was transferred to Ontario by virtue of the 1912 legislation and the operation of s. 109, by operation of law, the power of Canada as beneficial owner to take up lands devolved to Ontario. The interest assigned to Ontario by s. 109 as beneficial owner carries with it the burden of the harvesting clause imposed by the treaty. In the exercise of its rights and powers as beneficial owner, Ontario is legally obliged to ensure that its actions on behalf of the Crown are consistent with the promises made by the Crown.

[141] For these reasons, we conclude that the trial judge erred by failing to apply the governing constitutional principles in her interpretation of the taking up clause.

The text of the harvesting clause

[142] For ease of reference, we repeat the text of the harvesting clause:

Her Majesty further agrees with her said Indians, that they, the said Indians, shall have [the] right to pursue their avocations of hunting and fishing throughout the tract surrendered as hereinbefore described subject to such regulations as may from time to time be made by Her Government of Her Dominion of Canada and saving and excepting such tracts as may, from time to time, be required or taken up for settlement, mining, lumbering or other purposes by Her said Government of the Dominion of Canada, or by any of the subjects thereof duly authorized therefor by the said Government.

[143] In our view, the trial judge's interpretation, although said to be based upon the literal wording of the harvesting clause, cannot be reconciled with the text for a number of reasons.

[144] The text of the harvesting clause plainly does not reflect or contemplate a two-step approval involving two levels of government for taking up tracts of land for settlement, mining, lumbering or other purposes. The text refers to only one level of government, the Dominion of Canada. The Dominion of Canada is referred to as the government that has the right to take up "such tracts as may, from time to time, be required or taken up . . . by Her [Majesty's] said Government of the Dominion of Canada". [page430]

[145] In our view, there can be no doubt that the reference to the Government of the Dominion of Canada reflects the fact that in 1873, Canada claimed beneficial ownership of all the lands governed by Treaty 3. The Keewatin lands were unquestionably Canada's and Canada strongly asserted its claim to beneficial ownership of the disputed territory.

[146] The only reference to Canada approving the taking up of lands is found in the concluding phrase of the clause, which contemplates lands being taken up "by any of the subjects thereof duly authorized therefor by the said Government". A province is not a "subject" of Her Majesty or a subject of Canada and these words have no application to Ontario.

[147] It is telling that the drafters of Treaty 3 did foresee a role for Canada to authorize other entities to take up lands. The authorization clause did not, however, use language that embraced the province. If the drafters of the treaty had actually intended that Canada would exercise a general supervisory role over the exercise of the taking up power, even if the borders of Ontario were extended, they could have said so. The fact that they did not tells against the trial judge's interpretation.

[148] Taken to its logical conclusion, the respondents' literal meaning argument would put the taking up clause in a legalistic straightjacket. If the text of the harvesting clause is to be read literally, that would mean that only Canada can take up lands. As a result of St. Catherine's Milling, it is clear that Canada cannot issue patents or permits for settlement, lumbering or mining. In other words, Canada does not have the authority to take up any of the surrendered lands. That net result would leave no level of government capable of doing so.

[149] The trial judge accepted the literal approach but was only able to escape this impossible result by departing from the literal approach to read into the clause a two-step land use regime that cannot be derived from the literal meaning.

[150] The text of the harvesting clause provides for taking up by one level of government. In 1873, it was believed that Canada enjoyed beneficial ownership of all Treaty 3 lands and Canada was accordingly specified as the government with the capacity to take up lands. Beneficial ownership and the legal authority to take up lands is derived from the Constitution, not the taking up clause in the treaty. When beneficial ownership was transferred to Ontario, Ontario took the place of Canada as the level of government with the capacity to take up lands, subject to the rights guaranteed by the treaty.

[151] To the extent the trial judge's interpretation rests on the argument that the language of the harvesting clause is [page431] ambiguous, it should be rejected. It is well established that as a rule, ambiguities in treaties are generally to be resolved in favour of the Aboriginal treaty partners: see R. v. Badger, 1996 CanLII 236 (SCC), [1996] 1 S.C.R. 771, [1996] S.C.J. No. 39, at para. 41. However, as stated in R. v. Marshall, at para. 14, "'[g]enerous' rules of interpretation should not be confused with a vague sense of after-the-fact largesse". Even a generous interpretation must be realistic, and reflect the intention of both parties and reconcile their interests: R. v. Sioui, 1990 CanLII 103 (SCC), [1990] 1 S.C.R. 1025, [1990] S.C.J. No. 48, at p. 1069 S.C.R.

[152] For the reasons just stated, we do not agree that the language is ambiguous.

[153] Finally, the trial judge's interpretation produces a process that is unnecessary, complicated, awkward and likely unworkable. The two-step process is unnecessary to protect the Aboriginal treaty harvesting right because when the Crown, through Ontario, takes up land, it must respect the treaty right. When Ontario stepped into Canada's shoes by virtue of the process of constitutional evolution, the legal standard that binds the Crown did not change and the treaty right is fully protected. To require both levels of government to be engaged in a two-step process is, on its face, complicated and awkward. It is difficult to see how the process of consultation, which is required when the treaty harvesting right is affected by taking up, would be improved by involving both levels of government.

[154] The trial judge's conclusion that Canada retains a role in Ontario's use of the taking up provision could undermine, rather than advance, reconciliation. Leaving meaningful constitutional space for the exercise of provincial jurisdiction under ss. 109, 92, para. 5 and 92A, without federal control under s. 91, para. 24, fosters direct dialogue between the province and Treaty 3 First Nations. Such dialogue is key to achieving the goal of reconciliation. As the Supreme Court stated in Haida Nation v. British Columbia (Minister of Forests), [2004] 3 S.C.R. 511, [2004] S.C.J. No. 70, 2004 SCC 73, at para. 32:

Reconciliation is not a final legal remedy in the usual sense. Rather, it is a process flowing from rights guaranteed by s. 35(1) of the Constitution Act, 1982. This process of reconciliation flows from the Crown's duty of honourable dealing toward Aboriginal peoples, which arises in turn from the Crown's assertion of sovereignty over an Aboriginal people and de facto control of land and resources that were formerly in the control of that people.

[155] For these reasons, we conclude that the trial judge erred in law in her interpretation of the taking up clause. [page432]

The trial judge's factual findings

[156] The trial judge's conclusion that Ontario could not exercise the taking up clause without Canada's approval was largely based on certain factual findings. We have already explained why we find the trial judge's interpretation of the taking up clause impossible to reconcile with the governing constitutional principles and the actual text of the clause. We will now consider the appellants' contention that her factual findings are fundamentally flawed.

[157] The trial judge's key finding is expressed in a variety of ways in her judgment but perhaps the clearest statement is that found at para. 1454:

The Commissioners deliberately provided in the Harvesting Clause that in the event Ontario won the Boundary Dispute or a new province with s. 109 powers were formed under s. 3 of the 1871 Constitution Act, authorization of "taking up" by Canada would be needed in addition to Ontario's or that new province's authorization under s. 109. In that event, the Commissioners did contemplate and intend that a two-step authorization process would need to be followed.

(Emphasis in original)

[158] We do not find it necessary to engage in a detailed consideration of the applicable standard of review. We will assume, without deciding, that the trial judge's findings are properly characterized as findings of adjudicative fact and that they attract the deferential "palpable and overriding error" standard of review. We note, however, that as the trial judge's findings of fact are mingled with her assessment of the effect of legislation and principles of treaty interpretation, there may be an argument that some or all of her findings attract a less deferential standard.

[159] In our respectful view, the trial judge's finding that a two-step authorization process had to be followed is wrong in both law and fact.

[160] The treaty was between the Crown and the Ojibway, not between Morris and the Ojibway. Even if Morris' intention was that found by the trial judge, without more, it is very difficult to see how Morris' subjective intention could have any impact upon the proper legal interpretation of the treaty. While any representation Morris made would be significant, it was conceded by the respondents in oral argument that there is no evidence to suggest that Morris communicated to the Ojibway an intention to require Canada's approval of taking up by Ontario.

[161] As the trial judge found, the Ojibway were no doubt concerned that the treaty promises would be kept and they naturally looked to Canada, their treaty partner, for that assurance. However, there is nothing in the record to suggest that there was any [page433] representation made to the Ojibway that the taking up clause would be subject to a process requiring the approval of two levels of government. And as held in St. Catherine's Milling, Morris could not, as a commissioner, remove Treaty 3 from the reach of the Constitution as it stood in 1873 and as it evolved in the years following.

[162] Moreover, the trial judge's factual finding as to Morris' intention is not only speculative but also inconsistent with the available evidence. It runs afoul the admonition in Mitchell v. M.N.R., [2001] 1 S.C.R. 911, [2001] S.C.J. No. 33, 2001 SCC 33, at para. 51, that "[s]parse, doubtful and equivocal evidence cannot serve as the foundation for a successful claim" and that findings based on "the application of a very relaxed standard of proof" and "an unreasonably generous weighing of tenuous evidence" will be set aside. We conclude that the finding is based on a palpable and overriding error and that it must be set aside. We arrive at that conclusion for the following reasons.

[163] As we have observed, the Treaty 3 negotiations were very well-documented. Morris himself wrote extensively on the negotiation of Treaty 3 and other treaties. There is nothing in this thorough documentation, which includes his reports and correspondence on his treaty-making activities, to support the thesis that Morris intentionally drafted the harvesting clause to require Canada's approval for Ontario's taking up should Ontario become the beneficial owner of the lands.

[164] The trial judge placed significant emphasis on the fact that Morris, a lawyer, former judge and long-time confidant of Sir John A. Macdonald, was a trained constitutional lawyer and had a sophisticated understanding of the governing legal principles. In our view, Morris' legal background detracts from rather than supports the trial judge's findings, because it is very difficult to reconcile the actual text of the harvesting clause with the trial judge's finding. It is difficult to imagine how or why an expert constitutional lawyer would have drafted the clause as he did had his intention been as described by the trial judge.

[165] The most likely explanation for the text of the harvesting clause and the reference to the Government of the Dominion of Canada is that, in 1873, there was no other government to whom the commissioners appointed by Canada could conceivably refer. As explained above, the Keewatin lands were unquestionably not in Ontario, and Canada vigorously contested Ontario's claim to the disputed territory. Prime Minister Macdonald refused to accept the arbitrators' boundary award in 1878 and would not yield until the Privy Council ruled in Ontario's favour in 1884. Even then, Prime Minister Macdonald continued [page434] to assert Canada's proprietary claim to the lands until it was rejected by the Privy Council in St. Catherine's Milling.

[166] Morris was sent as Prime Minister Macdonald's confidant to negotiate the treaty and he was very close to the prime minister. It is highly unlikely he would have done anything that would have undermined Prime Minister Macdonald's position on the disputed territory. To recognize in the language of the treaty the possibility that all or part of the Treaty 3 lands might belong to Ontario would be inconsistent with and would undermine Prime Minister Macdonald's position.

[167] The trial judge's interpretation is also inconsistent with the available evidence as to the contemporary understanding of the harvesting clause. As described above, within a year of the signing of the treaty, Canada and Ontario entered into the 1874 provisional boundary agreement to deal with the administration of the treaty lands pending settlement of the boundary dispute by way of arbitration. This agreement was possible because Macdonald had left office and the Mackenzie government, which came to power in early 1874, was willing to submit the dispute to arbitration.

[168] The agreement provided that Ontario would grant patents for lands east and south of the provisional boundary and that Canada would grant patents for the western and northern portion of the lands. It was also agreed that if the provisional boundary were subsequently determined to be wrong, the government found to have jurisdiction over the lands would ratify any patents that had been issued by the other government.

[169] Plainly, the 1874 agreement reflects a contemporary understanding that the right to take up lands attached to the level of government that enjoyed beneficial ownership of the lands. There is no reference to any requirement that Ontario obtain Canada's approval for taking up lands.

[170] As we will discuss in detail below, the 1891 legislation and 1894 agreement, which confirm Ontario's power to take up lands, are also very revealing as to the contemporary understanding.

[171] Another point that tells against the trial judge's finding is that until this case was commenced, there was no suggestion that Ontario had to obtain Canada's approval to access the taking up clause. The precise details of settlement, lumbering and mining activities and their impact on Aboriginal harvesting are sparse. However, it cannot be doubted that in the more than 100 years since the Keewatin lands became part of Ontario, lands have been taken up by Ontario for those purposes without any suggestion that Ontario required Canada's approval or that Treaty 3 mandated a two-step land use regime. [page435]

[172] For these reasons, we conclude that the trial judge's factual finding that the commissioners deliberately contemplated and intended a two-step authorization process and that Canada would have to authorize taking up by Ontario cannot survive scrutiny even under the deferential "palpable and overriding" error standard.

2. Did the trial judge err in her interpretation of the 1891 legislation, the 1894 agreement and the 1912 legislation?

[173] As previously noted, the trial judge found that while Ontario did not have the right to take up pursuant to Treaty 3 as a result of the operation of law, the 1891 legislation and the 1894 agreement expressly amended Treaty 3 so as to give Ontario the unilateral right to take up in the disputed territory. In her view, the 1912 legislation -- considered alone or in combination with the 1891 legislation and the 1894 agreement -- did not give Ontario that right in respect of the Keewatin lands. Accordingly, she held that Ontario's power to take up Keewatin lands is subject to Canada's supervision and authorization.

[174] In our view, the 1891 legislation and the 1894 agreement merely confirmed Ontario's right to take up under Treaty 3 without Canada's approval or permission in the disputed territory. We are further of the view that once the Keewatin lands became part of Ontario in 1912, Ontario stepped into the shoes of Canada for the purposes of Treaty 3's harvesting clause in the Keewatin lands.

Confirmation of Ontario's existing right

[175] The 1891 legislation is reciprocal legislation authorizing Canada and Ontario to enter into an agreement relating to the Treaty 3 lands. The 1891 legislation includes a Schedule containing a draft agreement which declares that the Aboriginal hunting and fishing rights in the disputed territory do not continue for tracts of land that have been, or will be, taken up by Ontario. It provides that the draft agreement, if and when concluded, would be binding on Canada and Ontario as if it were itself set out in an Act of Parliament or the Ontario legislature.

[176] The draft agreement was subsequently executed by both governments, at which point it became the 1894 Agreement. Having been concluded under the reciprocal legislation of 1891, the 1894 agreement has the force of legislation.

[177] It is apparent from the content of the 1894 agreement that its two principal purposes were (1) to obtain Ontario's concurrence in the selection of reserve lands; and (2) to confirm, [page436] in respect of the harvesting rights identified in Treaty 3, that Ontario could take up Treaty 3 lands within its territorial boundaries as those stood in 1894. In this regard, we note that the preamble of a statute shall be read as a part of the enactment intended to assist in explaining the statute's purport and object: Interpretation Act, R.S.C. 1985, c. I-21, s. 13.

[178] The relevant provisions of the 1894 agreement read as follows:

Whereas by Articles of [Treaty 3] . . . , the Saulteaux tribe of the Ojibbeway Indians and all other the Indians inhabiting the country therein defined and described surrendered to Her Majesty all their rights, titles and privileges whatsoever to the lands therein defined and described on certain terms and considerations therein mentioned:

And whereas by the said treaty, out of the lands so surrendered, reserves were to be selected and laid aside for the benefit of the said Indians; and the said Indians were amongst other things hereinafter provided to have the right to pursue their avocations of hunting and fishing throughout the tract surrendered, subject to such regulations as might, from time to time, be made by the Government of the Dominion of Canada, and saving and excepting such tracts as might, from time to time, be required or taken up for settlement, mining, lumbering or other purposes by the said Government of the Dominion of Canada or by any of the subjects thereof duly authorized therefor by the said Government:

And whereas the true boundaries of Ontario have since been ascertained and declared to include part of the territory surrendered by the said treaty, and other territory north of the height of land with respect to which Indians are understood to make a claim as being occupants thereof, according to their mode of occupying, and as not having yet surrendered their claim thereto or interest therein. . . .

1. With respect to the tracts to be, from time to time, taken up for settlement, mining, lumbering or other purposes and to the regulations required in that behalf, as in the said treaty mentioned, it is hereby conceded and declared that, as the Crown lands in the surrendered tract have been decided to belong to the Province of Ontario, or to Her Majesty in right of the said Province, the rights of hunting and fishing by the Indians throughout the tract surrendered, not including the reserves to be made thereunder, do not continue with reference to any tracts which have been, or from time to time may be, required or taken up for settlement, mining, lumbering or other purposes by the Government of Ontario or persons duly authorized by the said Government of Ontario; and that the concurrence of the Province of Ontario is required in the selection of the said reserves.

(Emphasis added)

[179] Article 1 of the 1894 agreement was clearly intended to confirm Ontario's right to take up in the disputed territory, and to recognize that such uses could be inconsistent with continued harvesting rights. In referring to Ontario's right, art. 1 says that it is "conceded and declared". These words demonstrate that Canada and Ontario were confirming in the 1894 agreement that which had already come to pass by operation of law. [page437]

[180] Accordingly, it is our view that art. 1 of the 1894 agreement explicitly declared and confirmed that the Treaty 3 regime operated in conformity with the law: Ontario, the government with the administration, control and beneficial ownership of the disputed territory, was the government with the exclusive authority to exercise the taking up power in Treaty 3.

[181] We would note that because the 1894 agreement is confirmatory of Ontario's right, it did not, as the trial judge found, amend Treaty 3.

Application of the 1894 agreement after 1912

[182] Given our analysis of the doctrine of constitutional evolution and the 1894 agreement, it follows as a matter of law that in 1912, when legislation extended to their present dimensions the territorial boundaries of the Province of Ontario, subject to certain terms and conditions, Ontario was, by operation of law, entitled to exercise the taking up power under Treaty 3 in relation to the Keewatin lands. However, as both the trial judge and the parties devoted considerable attention to the issue, we provide the following fuller explanation of the application of the 1894 agreement after 1912.

[183] Parliament enacted the legislation extending Ontario's boundary on April 1, 1912. To be effective, such legislation required the consent of the Ontario legislature. Accordingly, on April 16, 1912, the Ontario legislature enacted legislation consenting to the enlargement of the province's boundaries and agreeing to the terms and conditions.

[184] The 1912 legislation (federal and provincial), and the Ontario boundary extension, took effect on May 15, 1912. In the result, a substantial portion of the tract of land previously known as the District of Keewatin in the North-West Territories became part of the Province of Ontario. The Keewatin lands are a part of the annexed tract.

[185] The 1912 legislation increased Ontario's boundaries to include the Keewatin lands upon the following terms and conditions:

2(a) That the province of Ontario will recognize the rights of the Indian inhabitants in the territory above described to the same extent, and will obtain surrenders of such rights in the same manner, as the Government of Canada has heretofore recognized such rights and has obtained surrender thereof, and the said province shall bear and satisfy all charges and expenditures in connection with or arising out of such surrenders;

(b) That no such surrender shall be made or obtained except with the approval of the Governor in Council; [page438]

(c) That the trusteeship of the Indians in the said territory, and the management of any lands now or hereafter reserved for their use, shall remain in the Government of Canada subject to the control of Parliament.

[186] The 1912 legislation did not expressly confirm Ontario's right to take up in the Keewatin lands, as art. 1 of the 1894 agreement had done in respect of the disputed territory. As this right flowed by operation of law, it was unnecessary to confirm that right.

[187] In any event, we are of the view that the text of the 1894 agreement is entirely consistent with our conclusion that art. 1 applied to the Keewatin lands on and after May 15, 1912.

[188] As we have seen, a principal purpose of the 1894 agreement was to confirm, in respect of the harvesting rights identified in Treaty 3, provincial (or provincially authorized) taking up activity within Ontario's territorial boundaries as those stood in 1894.

[189] As of May 15, 1912, the Government of Ontario acquired in respect of ceded Keewatin lands the same constitutional and proprietary capacity it had previously to take up (or to authorize the taking up) of ceded Treaty 3 lands within its boundaries. Nothing in the operative text of art. 1 of the 1894 agreement purports to differentiate between Treaty 3 lands that lay within Ontario's original boundaries and other Treaty 3 lands that might subsequently become Crown lands in Ontario. The language of art. 1, with Canada's concession and declaration as to Ontario's authority, is entirely consistent with provincial taking up activity in and after 1912 in respect of the Keewatin lands.

[190] Furthermore, art. 1 of the 1894 agreement gives as the reason for Canada's concession and declaration in respect of provincial taking up and Treaty 3 harvesting rights, the fact that "the Crown lands in the surrendered tract have been decided to belong to the Province of Ontario". It is common ground that not all "the Crown lands in the surrendered tract" belonged to Ontario in 1894 -- the Keewatin lands did not, nor did Treaty 3 lands in Manitoba.

[191] The effect of the 1912 legislation on Ontario's boundaries was to stipulate that the unpatented Keewatin lands, along with other lands from the former District of Keewatin, belonged to the Province of Ontario. Thus, as of 1912, the rationale expressly offered for Canada's concession and declaration in art. 1 of the 1894 agreement applied with equal force to the Keewatin lands. [page439]

[192] Therefore, the text of, and rationale for, the 1894 agreement are both consonant with our view that provincial (or provincially authorized) taking up activity in respect of the Keewatin lands in and after 1912 was effective, pursuant to art. 1 of the 1894 agreement, in relation to Treaty 3 harvesting rights.

Interpretation of the 1912 legislation

[193] Three principles of statutory interpretation reinforce our view that it was unnecessary for the 1912 legislation to contain similar language to that in art. 1 of the 1894 agreement.

[194] The first "presumes a harmony, coherence and consistency between statutes dealing with the same subject matter": see R. v. Ulybel Enterprises Ltd., [2001] 2 S.C.R. 867, [2001] S.C.J. No. 55, 2001 SCC 56, at para. 52. This principle, often referred to as the in pari materia principle, was recently reaffirmed by the Supreme Court of Canada in Sharbern Holding Inc. v. Vancouver Airport Centre Ltd., [2011] 2 S.C.R. 175, [2011] S.C.J. No. 23, 2011 SCC 23. In that case, as in the present one, the court was considering successor related legislation. At para. 117, the Supreme Court said this:

Lord Mansfield explained this principle in R. v. Loxdale (1758), 1 Burr. 445, 97 E.R. 394, observing that "[w]here there are different statutes in pari materia though made at different times, or even expired . . . they shall be taken and construed together . . . and as explanatory of each other" (p. 395).

[195] The second principle of statutory interpretation is the presumption that "the legislature does not intend to produce absurd consequences": see Rizzo & Rizzo Shoes Ltd. (Re) (1998), 1998 CanLII 837 (SCC), 36 O.R. (3d) 418, [1998] 1 S.C.R. 27, [1998] S.C.J. No. 2, at para. 27. To interpret the 1912 legislation so that the Keewatin lands were not subject to Ontario's unsupervised jurisdiction would create a clear inconsistency with the 1891 legislation. The result would be that different parts of the Treaty 3 lands would be subject to different regimes for the purposes of taking up. Indeed, there would be inconsistent treatment of the Treaty 3 lands used by members of the Grassy Narrows First Nation, some of which fall within the Keewatin lands and others of which do not. Our view of the legislation avoids these undesirable and absurd consequences.

[196] The third is the interpretive maxim that "the law shall be considered as always speaking". Legislative provisions are not bound to the historic state of affairs at the time of their enactment. As the Supreme Court stated in R. v. 974649 Ontario Inc., [2001] 3 S.C.R. 575, [2001] S.C.J. No. 79, 2001 SCC 81, at para. 38: [page440]

The intention of Parliament or the legislatures is not frozen for all time at the moment of a statute's enactment, such that a court interpreting the statute is forever confined to the meanings and circumstances that governed on that day. Such an approach risks frustrating the very purpose of the legislation by rendering it incapable of responding to the inevitability of changing circumstances.

[197] Finally, and very importantly, we would reiterate that our view of the 1912 legislation accords with constitutional law dictates. At the moment that the Keewatin lands became part of Ontario, the Constitution Act, 1867, s. 109 applied and Ontario gained beneficial ownership of the lands "unencumbered by any operation of s. 91(24)": see Smith v. Canada, at p. 564 S.C.R. Upon the transfer of the beneficial interest in the Crown's underlying title to Ontario, by operation of law, the Crown's rights and obligations devolved to Ontario as well. It would have taken clear and express language in the 1912 legislation for Canada to extend Ontario's boundaries to encompass the Keewatin lands but at the same time purport to withhold an essential incident of administration and control (i.e., the taking up provision) over those lands. In our view, the terms and conditions in the 1912 legislation do not amount to such language.

[198] Section 2(a) of the 1912 legislation requires Ontario to recognize the rights of the Indians in the Keewatin lands to the same extent that Canada had theretofore recognized such rights. That is, Ontario is to "stand in Canada's shoes" for the purposes of recognizing the rights of First Nations in the Keewatin lands. This condition contemplates, therefore, that Ontario could take up Keewatin lands under the treaty only to the same extent that Canada could validly do so prior to 1912. In light of modern constitutional jurisprudence, this means that Ontario's taking up power is subject to the limitations and obligations flowing from the honour of the Crown and s. 35 of the Constitution Act, 1982. These obligations and limitations are discussed below.

[199] Section 2(c) reserves to Canada "the trusteeship of the Indians in the said territory". There is nothing in this language that precludes Ontario from having the same ability that Canada previously had to take up Keewatin lands. Moreover, and particularly in light of s. 2(a), it would torture the language of s. 2(c) to interpret it as creating or retaining a role for Canada in Ontario's exercise of the taking up provision in respect of off-reserve, Treaty 3 ceded lands.

[200] Finally, this view of the 1891 legislation, the 1894 agreement and the 1912 legislation, which holds that Ontario has exclusive jurisdiction to administer ceded off-reserve lands for its sole benefit, was acknowledged in further legislation passed [page441] by Parliament and the Ontario legislature in 1924. The reciprocal Acts making up the Indian Lands Act, 1924, S.C. 1924, c. 48, Sch. 1; S.O. 1924, c. 15, Sch. A deal primarily with reserves. However, their preambles confirm a continuing understanding that only Ontario administers ceded off-reserve treaty lands.

3. Does Ontario's use of the taking up clause, short of infringement, engage s. 91, para. 24?

[201] The trial judge concluded that Ontario's right to take up in the Keewatin lands was subject to Canada's approval. We have already considered and rejected the main reason she gave for arriving at that conclusion, namely, that the treaty expressly provided for a two-step authorization process. We turn here to a second reason she offered, specifically that Canada's s. 91, para. 24 jurisdiction over Indians gives Canada a residual and continuing role in respect of Ontario's use of the taking up provision.

[202] In our view, the trial judge's conclusion rests on three errors. First, in viewing provincial land ownership as being qualified by federal jurisdiction over Indians, the trial judge erred with respect to the division of powers. Second, her conclusion cannot be reconciled with St. Catherine's Milling and Smith, both of which are binding. Third, the trial judge's conclusion that Canada has ongoing supervisory authority over Ontario's exercise of the taking up provision is inconsistent with Mikisew.

[203] We have fully canvassed the first two points in our earlier discussion of the constitutional framework and the process of constitutional evolution that took place when Ontario's boundary expanded to include the Keewatin lands.

[204] The trial judge appears to consider that federal jurisdiction over treaty rights, which properly comes within s. 91, para. 24 jurisdiction, encompasses a continuing role for Canada in respect of the taking up of lands for provincial purposes in lands ceded by treaty.

[205] With respect, such an expansion of s. 91, para. 24 jurisdiction would render illusory provincial jurisdiction over the disposition and management of public lands and forests under ss. 109, 92, para. 5 and 92A. As we have already explained, this would be contrary to the decision of the Privy Council in St. Catherine's Milling and that of the Supreme Court of Canada in Smith. It would also be contrary to the Supreme Court's emphasis on balanced federalism and the interdiction that "a federal head of power cannot be given a scope that would eviscerate a provincial legislative competence": see [page442] Reference Re Securities Act, [2011] 3 S.C.R. 837, [2011] S.C.J. No. 66, 2011 SCC 66, at para. 71.

[206] Turning to Mikisew, the trial judge's conclusion that Canada has a residual s. 91, para. 24 supervisory authority over Ontario's use of the taking up clause is at odds with the principles set out by the Supreme Court of Canada in that case.

[207] It is important to distinguish between a provincial taking up that would leave no meaningful harvesting right in a First Nation's traditional territories from a taking up that would have a lesser impact than that. The former would infringe the First Nations' treaty rights, whereas the latter would not. Where it is claimed that a taking up will infringe a treaty right, Mikisew makes it clear that the remedy is to bring an action for treaty infringement: see para. 48. An action for infringement does not engage Canada in a supervisory role.

[208] Mikisew also explains the process that must be followed by a governmental entity seeking to take up surrendered lands, short of infringement.

[209] To uphold the honour of the Crown, the governmental entity must first inform itself of the degree to which the contemplated conduct would adversely affect the Aboriginal peoples' right to hunt, fish and trap and whether that triggers the duty to consult. It must communicate its findings to the affected Aboriginal peoples. It must attempt to deal with First Nations in good faith and with the intention of substantially addressing their concerns. The duty to consult is triggered at a low threshold but adverse impact is a matter of degree, as is the extent of the content of the governmental entity's duty to consult and accommodate.

[210] Ontario, as the emanation of the Crown holding the beneficial ownership of the public lands ceded by Treaty 3, is required to respect Treaty 3 harvesting rights. Its s. 109 powers are subject to Aboriginal harvesting rights.

[211] Ontario must respect those rights and manage changes to them in accordance with the honour of the Crown and s. 35 of the Constitution Act, 1982. Ontario cannot take up lands so as to deprive the First Nation signatories of a meaningful right to harvest in their traditional territories. Further, honourable management requires that Ontario, as the government with authority to take up in the Keewatin lands, must consult with First Nations and accommodate their treaty rights whenever they are sufficiently impacted by the taking up. As noted above, Ontario accepts these constitutional obligations.

[212] These significant protections, grounded in the honour of the Crown and s. 35 of the Constitution Act, 1982, revolve [page443] around direct interaction between Ontario and the First Nation signatories. They do not contemplate the involvement of an additional level of government. In other words, Ontario is not subject to federal supervision in carrying out its obligations.

Issues related to question two

1. Does inter-jurisdictional immunity apply and can Ontario resort to a Sparrow justification?

[213] It will be recalled that the second threshold question was:

Question Two: If the answer to question/issue 1 is no, does Ontario have the authority pursuant to the division of powers between Parliament and the legislatures under the Constitution Act, 1867 to justifiably infringe the rights of the plaintiffs to hunt and fish as provided for in Treaty 3?

[214] The trial judge answered this question in the negative. She held that Ontario is constrained by the division of powers and that Canada, using its s. 91, para. 24 jurisdiction, can make treaty promises that affect Ontario's proprietary interests. She went on to hold that the doctrine of inter-jurisdictional immunity applied. The result, in her view, was that as treaty-protected harvesting rights are at the core of the federal government's s. 91, para. 24 jurisdiction, Ontario cannot interfere with them unless allowed to do so under s. 88 of the Indian Act, R.S.C. 1985, c. I-5. She then concluded that s. 88 could have no application as in the circumstances of this proceeding, provincial law cannot displace treaty rights.

[215] By its terms, the court is to answer the second threshold question only if it answered the first threshold question in the negative. Accordingly, having answered the first threshold question affirmatively, there is no need to consider the second threshold issue. We wish to note, however, that nothing in these reasons should be construed as approval of the trial judge's reasoning or result in respect of the second threshold issue.

G. The Intervenors' Issues

[216] As explained above, five First Nations, or groups thereof, intervened in these appeals: Wabauskang, the Big Grassy intervenors, the Grand Council of Treaty #3, Lac Seul and the Treaty 6 intervenors. [page444]

[217] The intervenors brought helpful perspectives to these appeals and their submissions informed the foregoing analysis. In this section, we address the discrete issues raised by those submissions.

Wabauskang, Big Grassy intervenors and Grand Council of Treaty #3

[218] Each of Wabauskang, the Big Grassy intervenors and the Grand Council of Treaty #3 raise issues about the scope of the trial judge's pronouncements. They urge this court to find that certain aspects of her reasons are obiter dicta and, therefore, not binding. Together, their submissions raise the following three issues.

[219] First, they submit that the trial judge's statements on Ontario's right, pursuant to the 1891 legislation and the 1894 agreement, to exercise the taking up power in the disputed territory, are obiter dicta. While they support the trial judge's finding that there was no evidence that Canada intended the 1891 legislation or the 1894 agreement to apply to the Keewatin lands, they submit that it was unnecessary for the trial judge to consider the effect of that legislation and agreement on Treaty 3 harvesting rights outside of the Keewatin lands. They point out that the threshold questions are limited to the Keewatin lands and that the respondents sought no determination in respect of the lands in the disputed territory. Further, they stress, the trial judge did not hear submissions on the importance or legal status of harvesting rights in the disputed territory and that this court should be cautious when interpreting instruments to the detriment of third parties to the proceedings.

[220] We appreciate this concern of these intervenors, particularly as they were not present at the trial to provide their perspective and make submissions on the effect of the 1891 legislation and the 1894 agreement on the disputed territory. However, we do not accept that the trial judge's statements relating to the scope and effect of those instruments were obiter dicta.

[221] A central question before the trial judge was whether the 1891 legislation and the 1894 agreement empowered Ontario to take up tracts in the Keewatin lands. While the respondents did not seek a determination of the legal effect of the 1891 legislation south of the English River in the disputed territory, that was the land to which the legislation and agreement applied when it was drafted and enacted. Because the respondents took the position that the legislation and agreement did not apply to the Keewatin lands, the interpretation of those instruments was [page445] squarely before the trial judge and had to be decided in order to answer the first threshold question. Her interpretation of those instruments was both necessary and relevant to the issues before her. Therefore, her comments are not obiter dicta.

[222] While we do not agree with the trial judge's analysis of the 1891 legislation and the 1894 agreement, we do agree with her conclusion on their legal effect in respect of the disputed territory. As we have explained, in our view, Ontario's right to take up tracts in the Keewatin lands flows from the constitutional framework, as interpreted by the Privy Council in St. Catherine's Milling. The 1891 legislation and the 1894 agreement merely confirm that right. Our conclusions in this matter apply to all of the Treaty 3 lands within Ontario's boundaries, including the disputed territory.

[223] Second, these intervenors submit that the trial judge's statements that Treaty 3 was amended by the 1891 legislation and the 1894 agreement so as to extinguish Aboriginal harvesting rights in the disputed territory are obiter dicta and erroneous. They say that the evidentiary record before the trial judge regarding the 1891 legislation and the 1894 agreement was inadequate to decide that their constitutionally protected treaty rights had been extinguished.

[224] We agree. The issue of the possible extinguishment of the intervenors' Treaty 3 harvesting rights in the disputed territory was not before the trial judge. Her statements on this matter are obiter dicta and, on that basis alone, are not binding.

[225] Furthermore, given the importance of Aboriginal constitutional rights and the onus on the Crown to act honourably, courts should proceed with caution in the matter of extinguishment. Findings of extinguishment should only be made when squarely raised, absolutely necessary, and after a thorough assessment of an adequate record. None of these conditions is met in the present proceeding. Neither Ontario nor Canada alleged, or sought to prove, that the 1891 legislation or the 1894 agreement extinguished Aboriginal harvesting rights.

[226] We would conclude this point by observing that in Mikisew the Supreme Court considered a very similar Treaty 8 taking up clause and its effect on Aboriginal harvesting rights and, at para. 31, makes clear that not every taking up constitutes an infringement of treaty rights that must be justified according to Sparrow. Put another way, the taking up clause in Treaty 3 operates as a limit on treaty harvesting rights, not an extinguishment of such rights.

[227] Third, these intervenors submit that statements made by the trial judge concerning the legal status of Treaty 3 reserve [page446] lands prior to 1915 are obiter dicta and unnecessary for the resolution of the issues at trial. Further, they submit that the trial judge's comments on the history of the treatment of the promised reserve lands following the signing of Treaty 3 do not appear to be supported by evidence and give an erroneous description of the history and legal status of the right to reserve lands, to the detriment of the Aboriginal beneficiaries of Treaty 3.

[228] In Ermineskin Indian Band and Nation v. Canada, [2006] F.C.J. No. 1961, 2006 FCA 415, [2007] 3 F.C.R. 245, affd [2009] 1 S.C.R. 222, [2009] S.C.J. No. 9, 2009 SCC 9, a complex treaty action involving a phased trial, the Federal Court of Appeal found that certain conclusions of the lower court were not relevant to the claims made in that phase of the trial. After noting that the conclusions were obiter, it declined to express an opinion of the correctness of those conclusions.

[229] We come to the same conclusion in this case. It was unnecessary for the trial judge to make statements concerning the legal status of Treaty 3 reserves prior to 1915. Those matters were not in issue and their resolution was not necessary for the proper adjudication of the claims before her. Accordingly, the trial judge's comments regarding Treaty 3 reserve lands are obiter dicta and nothing in these reasons should be taken as suggesting that those comments are correct.

Lac Seul

[230] Lac Seul seeks negative answers to the two threshold questions based on submissions relating to the honour of the Crown and its duty to consult all affected First Nations. It contends that both Ontario and Canada should be required to engage in consultation with all affected First Nations regarding Canada's involvement in the taking up of Keewatin lands. Lac Seul emphasizes that consultation and negotiation are the preferable methods by which to reconcile state and Aboriginal interests, and stresses that the duty to consult should not be avoided by bringing legal action.

[231] We agree that the honour of the Crown, the duty to consult and the process of reconciliation are foundational principles at play in this proceeding. They are specifically addressed in a number of parts of the foregoing discussion. However, we decline to accede to any suggestion that this proceeding be stayed or adjourned until consultation has taken place, as these appeals are properly before us. [page447]

The Treaty 6 intervenors

[232] The Treaty 6 intervenors provided their perspective with respect to the negotiation and formation of Treaty 6. The tracts of lands covered by Treaty 6, which was signed in 1876, constitute much of central Alberta and Saskatchewan. The taking up clause in Treaty 6 is identical to that in Treaty 3.

[233] After identifying other similarities between Treaty 3 and Treaty 6, the Treaty 6 intervenors made submissions based on a comparison of s. 1 of the Natural Resources Transfer Agreement, 1930, being Schedule 2 (Alberta) and Schedule 3 (Saskatchewan) to the Constitution Act, 1867 ("NRTA") with s. 109 of the Constitution Act, 1867. We do not propose to comment on the NRTA as it is unnecessary for the resolution of these appeals.

H. Disposition

[234] Accordingly, the appeals are allowed. The answer to question one is yes. It is not necessary to answer question two.

[235] Ontario and Canada shall pay the respondents' costs of the appeals, on a partial indemnity basis, in accordance with the terms of this court's order dated December 7, 2012. With the exception of Wabauskang, the intervenors are neither liable for nor entitled to costs of the appeals.

[236] Wabauskang was given party intervenor status because their Aboriginal rights are directly affected by the judgment under appeal. Its position is very similar to that of the respondents. The reasons given for ordering costs in favour of the respondents apply to Wabauskang as well. Therefore, we order reasonable costs of the appeals to Wabauskang on a partial indemnity basis. Should Canada, Ontario and Wabauskang be unable to agree on the quantum of costs, they may return to the court for assistance.

[237] We thank all counsel for their excellent submissions.

Appeal allowed.

APPENDIX A

THE NORTH WEST ANGLE TREATY, NUMBER THREE

October 3, 1873

Articles of a Treaty made and concluded this third day of October in the year of our Lord one thousand eight hundred and seventy-three, between Her Most Gracious Majesty the Queen of Great Britain and Ireland by her Commissioners, the Honorable Alexander Morris, Lieutenant-Governor of the Province of Manitoba and the North West Territories, Joseph Albert [page448] Norbert Provencher and Simon James Dawson of the one part and the Saulteaux Tribe of the Ojibbeway Indians, inhabitants of the country within the limits hereinafter defined and described, by their Chiefs chosen and named as hereinafter mentioned, of the other part.

Whereas the Indians inhabiting the said country have, pursuant to an appointment made by the said Commissioners been convened at a meeting at the North West Angle of the Lake of the Woods to deliberate upon certain matters of interest to Her Most Gracious Majesty of the one part and the said Indians of the other.

And Whereas the said Indians have been notified and informed by Her Majesty's said Commissioners that it is the desire of Her Majesty to open up for settlement, immigration, and such other purpose as to Her Majesty may seem meet a tract of country bounded and described as hereinafter mentioned and to obtain the consent thereto of her Indian subjects inhabiting the said tract and to make a Treaty and arrange with them, so that there may be peace and good will between them and Her Majesty, and that they may know and be assured of what allowance they are to count upon and receive from Her Majesty's bounty and benevolence.

And Whereas, the Indians of the said tract duly convened in Council as aforesaid and being requested by Her Majesty's said Commissioners to name certain Chiefs and headmen who should be authorized on their behalf to conduct such negotiations and sign any Treaty to be founded thereon and to become responsible to Her Majesty for the faithful performance by their respective bands of such obligations as shall be assumed by them the said Indians have thereupon named the following persons for that purpose that is to say: --Kee-ta-Kay-pi-nais (Rainy River), Kitchi-gay-kake (Rainy River), No-te-na-qua-hung (North West Angle), Mawe-do-pe-ness (Rainy River), Pow-wa-sang (North-West Angle), Canda-com-igo-we-ninie (North West Angle), Pa-pa-sko-gin (Rainy River), May-no-wah-tau-ways-kung (North-West Angle), Kitche-ne-ka-be-han (Rainy River), Sah-katch-eway (Lake Seul), Muka-day-wah-sin (Kettle Falls), Me-kie-sies (Rainy Lake, Fort Francis), Oos-con-na-geish (Rainy Lake), Wah-shis-konce (Eagle Lake), Kah-kee-y-ash (Flower Lake), Go-bay (Rainy Lake), Ka-me-ti-ash (White Fish Lake), Nee-sho-tal (Rainy River), Kee-je-go-kay (Rainy River), Sha-sha-gance (Shoal Lake), Shah-win-na-bi-nais (Shoal Lake), Ay-ash-a-wash (Buffalo Point), Pay-ah-bee-wash (White Fish Bay), Kah-tay-tay-pa-a-cutch (Lake of the Woods).

And thereupon in open Council the different Bands having presented their Chiefs to the said Commissioners as the Chiefs and Headmen for the purposes aforesaid of the respective Bands of Indians inhabiting the said District hereinafter described. And Whereas the said Commissioners then and there received and acknowledged the persons so presented as Chiefs and Headmen for the purposes aforesaid of the respective Bands of Indians inhabiting the said District hereinafter described;

And Whereas the said Commissioners have proceeded to negotiate a Treaty with the said Indians, and the same has been finally agreed upon and concluded as follows, that is to say:

The Saulteaux Tribe of the Ojibbeway Indians and all other the Indians inhabiting the district hereinafter described and defined, do hereby cede, release, surrender, and yield up to the Government of the Dominion of Canada for Her Majesty the Queen and her successors forever, all their rights, titles and privileges whatsoever to the lands included within the following limits that is to say: [page449]

Commencing at a point on the Pigeon River Route where the International Boundary Line between the Territories of Great Britain and the United States intersects the Height of Land separating the waters running to Lake Superior from those flowing to Lake Winnipeg; thence Northerly, Westerly, and Easterly, along the Height of Land aforesaid, following its sinuosities, whatever their course may be, to the point at which the said Height of Land meets the summit of watershed from which the streams flow to Lake Nepigon, thence Northerly and Westerly, or whatever may be its course along the ridge separating the waters of the Nepigon and the Winnipeg to the Height of Land dividing the waters of the Albany and the Winnipeg, thence Westerly and North-Westerly along the Height of Land dividing the waters flowing to Hudson's Bay by the Albany or other rivers from those running to English River and the Winnipeg to a point on the said Height of Land bearing North forty five degrees east from Fort Alexander at the mouth of the Winnipeg; thence south forty five degrees west to Fort Alexander at the mouth of the Winnipeg; thence Southerly along the Eastern bank of the Winnipeg to the mouth of White Mouth River; thence Southerly by the line described as in that part forming the Eastern boundary of the tract surrendered by the Chippewas and Swampy Cree Tribes of Indians to Her Majesty on the third of August, one thousand eight hundred and seventy one, namely; by White Mouth River to White Mouth Lake and thence on a line having the general bearing of White Mouth River to the forty ninth parallel of North Latitude; thence by the forty ninth parallel of Nnorth Latitude to the Lake of the Woods and from thence by the International Boundary Line to the place of beginning.

The tract comprised within the lines above described embracing an area of fifty five thousand square miles, be the same more or less.

To Have and to Hold the same to Her Majesty the Queen and her successors forever.

And Her Majesty the Queen hereby agrees and undertakes to lay aside reserves for farming lands due respect being had to lands at present cultivated by the said Indians and also to lay aside and reserves for the benefit of the said Indians to be administered and dealt with for them by Her Majesty's Government of the Dominion of Canada in such a manner as shall seem best, other Reserves of land in the said Territory hereby ceded, which said Reserves shall be selected and set aside where it shall be deemed most convenient and advantageous for each Band or Bands of Indians, by the officers of the said Government appointed for that purposes, and such selection shall be so made after conference with the Indians; provided, however, that such reserve whether for farming or other purposes shall in nowise exceed in all one square mile for each family of five, or in that proportion for larger or smaller families and such selection shall be made if possible during the course of next summer or as soon thereafter as may be found practicable, it being understood, however, that if at the time of any such selection of any Reserves as aforesaid, there are any settlers within the bounds of the lands Reserved by any Band Her Majesty Reserves the right to deal with such settlers as she shall deem just so as not to diminish the extent of land allotted to Indians and provided also that the aforesaid Reserves of lands or any interest or right therein or appurtenant thereto, may be sold, leased or otherwise disposed of by the said Government for the use and benefit of the said Indians, with the consent of the Indians entitled thereto first had and obtained.

And with a view to show the satisfaction of Her Majesty with the behaviour and good conduct of her Indians, she hereby, through her Commissioners [page450] makes them a present of twelve dollars for each man, woman and child belonging to the Bands here represented in extinguishment of all claims heretofore preferred.

And further, Her Majesty agrees to maintain schools for instruction in such reserves hereby made as to her Government of her Dominion of Canada may seem advisable whenever the Indians of the reserve shall desire it.

Her Majesty further agrees with her said Indians that within the boundary of Indian reserves, until otherwise determined by the Government of the Dominion of Canada, no intoxicating liquor shall be allowed to be introduced or sold and all laws now in force, or hereafter to be enacted to preserve Her Indian subjects inhabiting the reserves or living elsewhere within her North West Territories from the evil influence of the use of intoxicating liquors shall be strictly enforced.

Her Majesty further agrees with her said Indians, that they the said Indians shall have [the] right to pursue their avocations of hunting and fishing throughout the tract surrendered as hereinbefore described subject to such regulations as may from time to time be made by Her Government of Her Dominion of Canada and saving and excepting such tracts as may, from time to time, be required or taken up for settlement, mining, lumbering or other purposes by her said Government of the Dominion of Canada, or by any of the subjects thereof duly authorized therefor by the said Government.

It is further agreed between Her Majesty and her said Indians that such sections of the reserves above indicated as may at any time be required for Public Works or buildings of what nature soever may be appropriated for that purpose by Her Majesty's Government of the Dominion of Canada, due compensation being made for the value of any improvements thereon.

And further that Her Majesty's Commissioners shall as soon as possible after the execution of this Treaty, cause to be taken an accurate census of all the Indians inhabiting the Tract above described, distributing them in families, and shall in every year ensuing the date hereof at some period in each year, to be duly notified to the Indians, and at a place or places to be appointed for that purpose within the territory ceded, pay to each Indian person the sum of five dollars per head yearly.

It is further agreed between Her Majesty and the said Indians that the sum of fifteen hundred dollars per annum shall be yearly and every year expended by Her Majesty in the purchase of ammunition and twine for nets for the use of the said Indians.

It is further agreed between Her Majesty and the said Indians that the following articles shall be supplied to any Band of the said Indians who are now actually cultivating the soil or who shall hereafter commence to cultivate the land that is to say: -- two hoes for every family actually cultivating also one spade per family as aforesaid, one plough for every ten families as aforesaid -- five harrows for every twenty families as aforesaid -- one scythe for every family as aforesaid,-- and also one axe; and one cross-cut saw, one hand-saw, one pit saw, the necessary files, one grindstone, one auger for each band, and also for each Chief for the use of his band, one chest of ordinary carpenter tools; also for each band enough of wheat, barley, potatoes and oats to plant the land actually broken up for cultivation by such band also for each Band, one yoke of oxen, one bull and four cows; all the aforesaid articles to be given once for all for the encouragement of the practice of agriculture among the Indians. [page451]

It is further agreed between Her Majesty and the said Indians that each Chief duly recognized as such shall receive an annual salary of twenty five dollars per annum and each subordinate officer not exceeding three for each Band shall receive fifteen dollars per annum; and each such Chief and subordinate officer as aforesaid shall also receive once in every three years a suitable suit of clothing; and each Chief shall receive in recognition of the closing of the Treaty a suitable flag and medal.

And the undersigned Chiefs, on their own behalf and on behalf of all other Indians inhabiting the tract within ceded, do hereby solemnly promise and engage, to strictly observe this Treaty, and also to conduct and behave themselves as good and loyal subjects of Her Majesty the Queen. They promise and engage that they will, in all respects, obey and abide by the law; that they will maintain peace and good order between each other, and also between themselves and other Tribes of Indians and between themselves and others of Her Majesty's subjects, whether Indians or whites, now inhabiting or hereafter to inhabit any part of the said ceded tract; and that they will not molest the person or property of any inhabitant of such ceded tract, or the property of Her Majesty the Queen, or interfere with or trouble any person passing or travelling through the said tract or any part thereof; and that they will aid and assist the officers of Her Majesty in bringing to justice and punishment any Indian offending against the stipulations of this Treaty, or infringing the laws in force in the country so ceded.

In witness whereof, Her Majesty's said Commissioners and the said Indian Chiefs have hereunto subscribed and set their hands at the North West Angle of the Lake of the Woods this day and year herein first above named.

(Signed) Alexander Morris, Lieutenant-Governor

J.A.N. Provencher, Indian Commissioner

S.J. Dawson, Indian Commissioner

Kee-ta-kay-pi-nais "x"

Kitchi-gay-kake "x"

No-te-na-qua-hung "x"

Mawe-do-pe-ness "x"

Pow-wa-sang "x"

Canda-com-igo-we-ninie "x"

Pa-pa-sko-gin "x"

May-no-wah-tau-ways-kung "x"

Kitche-ne-ka-be-han "x"

Sah-katch-eway "x"

Muka-day-wah-sin "x"

Me-kie-sies "x"

Oos-con-na-geish "x"

Wah-shis-konce "x"

Kah-Kee-y-ash "x"

Go-bay "x"

Ka-me-ti-ash "x"

Nee-sho-tal "x"

Kee-je-go-kay "x"

Sha-sha-gance "x"

Shah-win-na-bi-nais "x"

Ay-ash-a-wash "x"

Pay-ah-bee-wash "x"

Kah-tay-tay-pa-a-cutch "x" [page452]

Signed by the Chiefs within named in presence of the following witnesses, the same having been first read and explained by the Hon. James McKay: --

(Signed) James McKay

Molyneux St. John

Robert Pither

Christine V.K. Morris

Charles Nolin

A. McDonald, Captain commanding escort to Lieutenant-Governor

James F. Graham

Joseph Nolin

A. McLeod

George McPherson, Sen.

Sedley Blanchard

W. Fred Buchanan

Frank G. Becher

Alfred Codd, M.D

Gordon S. Corbault

Pierre LeVieller

Nicholas Chatelaine

We hereby certify that the foregoing is a true copy of the original articles of treaty of which it purports to be a copy.

(Signed) Alexander Morris, Lieutenant-Governor.

J.A.N. Provencher, Indian Commissioner.

S.J. Dawson, Indian Commissioner.