Gitxaala First Nation challenges British Columbia’s mineral tenure regime

The province of British Columbia’s “free entry” mineral tenure regime, which allows the holder of a free miner certificate to acquire mineral claims issued by the provincial government, is the subject of a recent court challenge brought by the Gitxaala First Nation in the Supreme Court of British Columbia. The Gitxaala allege the current mineral tenure regime violates the provincial Crown’s constitutional obligation to consult prior to disposing of an interest on lands where Aboriginal rights have been asserted, in addition to the province’s commitment to implement the United Nations’ Declaration on the Rights of Indigenous Peoples. The court began hearing arguments on this ground-breaking legal challenge on April 3, 2023.

In British Columbia, the Mineral Tenure Act governs the acquisition of entitlements to minerals held by the provincial government on certain “mineral lands,” which includes provincial government land and private land where mineral rights have been reserved to the government. Under this system, which has been in place since the gold rush era, a person who holds a free miner certificate is able to acquire mineral claims on mineral lands without requiring the consent of the government or landowner.

This process of mineral claim acquisition, commonly referred to as the “free entry” system, was designed to encourage mining activity of the province’s vast and underexplored resource potential. While a mineral claim provides the holder with certain limited rights to minerals that may or may not be present, it does not permit the claim holder to cause any material disturbance to the lands or to develop and operate a mine. Rather, the mineral claim represents a mere chattel interest in the minerals which, with limited exceptions, remain under government control. Without additional permits, a claim holder is restricted to carrying out low-impact, non-mechanized activities.

The Mines Act is the principal statute regulating mining activity through the lifecycle of a mine in British Columbia, through initial exploration to development and operations and, ultimately, to closure and reclamation. The process to obtain a Mines Act permit to conduct any impactful operations includes requirements, proportionate to the proposed activity, for consultation with third parties whose interests may be affected, including Indigenous groups. If and when the potential impact of the proposed activity increases, a proponent will face a correspondingly more intensive regulatory regime, requiring third-party consultations and the requirements of other legislation, including for example, over environmental and water management.

In 2018 and 2020, the province’s chief gold commissioner, without consultation with the Gitxaala Nation, registered several mineral claims over lands on Banks Island, B.C. – an area the Gitxaala claim they have exclusively occupied, governed, managed and harvested for thousands of years. The Gitxaala have asserted Aboriginal rights, including Aboriginal title, to this area, and, consequently, argue they are entitled to the exclusive possession, use and control of minerals. The Gitxaala’s position is that the provincial government failed to consult prior to accepting and registering mineral claims over lands where Aboriginal rights and title have been asserted.

In addition to other declarations, the Gitxaala are seeking to set aside the Banks Island mineral claims, together with an order to discontinue or suspend the operational functions of the mineral titles registry which grant mineral claims without consultation.

In brief, the principal legal issue in the proceeding is whether the registration of a mineral claim, in and of itself, triggers the duty to consult and accommodate affected Indigenous groups. Canadian case law has established that the duty to consult arises whenever the government is contemplating a decision or action that has the potential to adversely affect asserted or established Aboriginal or treaty rights. When triggered, the duty to consult (and accommodate where appropriate), is a process that requires collaboratively working together to find a compromise that balances the conflicting interests at issue, in a manner that minimally impairs the right.

In its response, the province asserts the system for registration of mineral claims is consistent with its obligations under Section 35 of Canada’s Constitution Act, 1982, and the principles guiding the conduct of the Crown in its dealings with Indigenous peoples. The position of the provincial government is that the registration of a mineral claim alone does not adversely affect Aboriginal rights, and the Mines Act permitting process (which includes consultation with Indigenous groups) is required before the occurrence of impactful mining activity. Since, in some instances, the accommodation of Aboriginal interests may mean the denial of applications for certain authorizations (including Mines Act permits), the province has argued that the conduct of the government on Banks Island is consistent with its obligations.

The Gitxaala’s legal challenge to the province’s mineral tenure regime is an example of the ongoing tension between the rights of Indigenous peoples and government decisions associated with resource development activities. The outcome of this case is likely to have significant implications, both for Indigenous groups in British Columbia and for mining companies operating within the province. It remains to be seen whether and to what extent these impacts might extend beyond the process to acquire new mineral claims, to also affect the interests of private parties in acquiring and transferring mineral tenures.

Robin Longe is a partner in Dentons Canada LLP’s Corporate group and acts as co-leader of the Firm’s national mining group. David Hunter is a partner in Dentons Canada LLP’s Corporate group.

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