‹ Minerals

Duty to Consult vs Free Range Staking

January 12, 2013

On December 27, 2012, the Yukon Court of Appeal ruled in Ross River Dena Council v Government of Yukon that the Yukon government has a duty to consult with First Nations when recording mineral claims in the First Nation’s traditional territory.

The case is important and interesting for a number of reasons.

The decision of the Court was suspended for one year to allow the Yukon government to make legislative changes to provide for aboriginal consultation. The Yukon Government must decide whether or not to appeal this case to the Supreme Court.


In all of Canada there are perhaps 620 First Nations or Inuit governments and only 20 have settled their land claims and established self-government arrangements. It is somewhat ironic that the Yukon, a jurisdiction with 11/14 settled land claims, is facing this issue.

Nevertheless, there are two important principles at play—the desire of individuals to acquire rights to minerals and the obligation of the Crown to consult with First Nations. Get it wrong and the consequences can be damaging to the economy and to society.

For the mining industry, free range staking has been a boon. Rights are easily acquired and companies can focus on the hard part—finding valuable resources. Think of Chuck Fipke, a guy who had a hunch there might be diamonds in the NWT. Through his discovery a staking rush ensued and three multi-billion diamond mines were built, employing hundreds of people. Make the process too onerous, with the dead hand of government controlling the levers, and prosperity could disappear.

For the First Nation, one must have sympathy for the Ross River Dena for standing up for their rights. The people of the First Nation are for the most part poor. The legal costs from the land claims process through the years have consumed all the proceeds that the First Nation would achieve if they settled their claim. In other words there is no incentive for the First Nation to settle its land claim. Meanwhile, one sees other First Nations, with economic development corporations, owning hotels and airlines, doing quite well. And did I mention the BC lawyers have done very well indeed from all the Ross River Dena land claims legal work—thank you very much. 

For the Yukon Government, they must decide to launch the appeal or not. On one hand, the court of appeal decision was unanimous, which suggests the Ross River Dene could well win before the Supreme Court. On the other hand, uncertainty is bad for the investment community, particularly the mining industry facing tough financial markets. Fighting the decision may be the right thing to buy time, if nothing else.  It would probably be easier though to bite the bullet an establish a new consultative approach.