Navigating Legal Waters: B.C. Court of Appeal Insulates Hydro Dam Owner from Nuisance Claims

On February 26, 2024, the British Columbia Court of Appeal (Court) issued its decision in Thomas and Saik’uz First Nation v. Rio Tinto Alcan Inc., upholding the B.C. Supreme Court’s dismissal of nuisance claims brought by two First Nations against a private owner of a hydroelectric dam on the Nechako River in northwestern British Columbia. 

Following a 189-day trial, the B.C. Supreme Court held that the dam owner, Rio Tinto Alcan Inc. (RTA), was not liable in private and public nuisance since RTA had established a defence of statutory authority by showing that the impact of its dam on fish or fisheries — and therefore the plaintiffs’ Aboriginal right to fish — was the “inevitable result” of operating the dam in accordance with government authorizations. For more information, please see our January 2023 Blakes Bulletin: B.C. Supreme Court Dismisses Aboriginal Rights-based Claim Against Private Owner of Historic Dam. 

The Court affirmed the B.C. Supreme Court’s conclusion. The decision confirms the approach that will be taken by B.C. courts, and potentially those elsewhere in Canada, to alleged interference by private parties on Aboriginal rights or title and, consequently, has significant implications for owners and operators of infrastructure in Indigenous territory and the First Nations themselves.

Analysis

Aboriginal Rights Can Support a Claim in Nuisance

RTA argued at trial and on appeal that only a proprietary right can give rise to liability in nuisance and, because the First Nations neither owned the Nechako fishery nor the fish, their Aboriginal right could not ground a nuisance claim. The Court ultimately rejected this argument and concurred with the trial judge that “a broader perspective” on nuisance is required. In the Court’s view, the unique nature of Aboriginal rights, their importance to reconciliation, and the fact that the First Nations’ Aboriginal rights were intimately related to a particular piece of land were sufficient to sustain a claim in nuisance. 

The Court clarified, however, that not every Aboriginal right will necessarily give its holder standing to sue in nuisance. Rather, in the Court’s view, any analysis of whether an Aboriginal right is sufficient to support a claim in nuisance would necessarily be contextual and grounded in the facts of each case. Here, the trial judge was entitled to find that the First Nations had a sufficient proprietary interest to support a nuisance claim since the First Nations alleged “an extreme and singular interference with their fishing rights that they had tried to have addressed for decades” and their rights were exercised at traditional fishing sites adjacent to their reserve lands, over which they had exclusive occupation. By implication, First Nations in other cases may not have standing to sue for nuisance where their Aboriginal rights are found to have an insufficient connection to their reserve lands or lands or waters over which they hold Aboriginal title.

Defence of Statutory Authority

The defence of statutory authority relieves a defendant from liability for nuisance where a government has authorized a certain thing to be made or done in a certain place, either expressly or by necessary implication, and the associated nuisance is the inevitable result of making or doing the thing so authorized. The defendant bears the onus of proving the resulting nuisance is an inevitable consequence of the authorized conduct, yet “inevitability” is assessed based on what is practically feasible at the time, not what is theoretically possible.

On appeal, the First Nations argued that the trial judge erred in two ways in concluding that the defence of statutory authority applied to relieve RTA of liability: 

1. He misinterpreted the requirements of the “inevitable result” aspect of the defence since he found that the harm amounting to a nuisance is the “inevitable result” of RTA’s statutory authority, while declining to determine whether there existed feasible alternatives within the range of the water discharge rate authorized by RTA’s water licence that would avoid the nuisance; and
2. He decided that the defence was applicable, notwithstanding that the statutory scheme unjustifiably infringes Aboriginal rights and is therefore unconstitutional.

The Court held that there was no reviewable error in the trial judge’s conclusion that the defence of statutory authority applied. In so holding, the Court affirmed that where government authorizations clearly contemplate the precise work, activity or conduct complained of — either expressly or implicitly — the government will be considered to have authorized the nuisance that is an inevitable consequence of that work, activity or conduct. In such cases, defendants do not need to establish that there were no practical, reasonable alternatives to proceeding in the authorized manner. The Court agreed with the trial judge that the question of practical, feasible alternatives did not arise here as RTA had been given specific authority and direction for the construction and operation of the dam, the diversion of water, and the timing and release of the volume of water into the Nechako River. 

The Court also declined to give effect to the appellants’ second argument that the defence of statutory authority was constitutionally inapplicable. As a result, the Court affirmed that RTA had established a full defence to the claims against it.

Remedies Against the Crown May Impact Future Regulation of Projects

Although the Court dismissed the appeal as it related to the nuisance claims against RTA, it allowed the appeal with respect to the scope of declaratory relief granted by the trial judge against the other two defendants in the case, B.C. and Canada. The Court held that the trial judge erred in principle in finding that he was precluded by prior decisions from granting more specific and directive declaratory relief. The Court therefore varied the declaration made by the trial judge to direct Canada and British Columbia to: (a) consult with the First Nations if government action in managing the flow regime on the Nechako River raises the potential for novel adverse impacts on Aboriginal rights, and (b) protect the appellants’ Aboriginal right to fish by ensuring that ongoing government participation in the management of the flow regime is substantively consistent with the requirements of section 35 of the Constitution Act, 1982, the section of the Canadian Constitution that recognizes and affirms existing Aboriginal and treaty rights. 

Takeaways

This decision provides further guidance to First Nations and land users whose activities may impact Aboriginal rights, indicating that such land users may be found liable for those impacts absent a valid defence. However, the Court’s decision offers protection from liability to the extent defendants can show that their conduct is authorized by the government and complies with constraints imposed by those authorizations, such that any alleged nuisance or trespass is the inevitable result of the authorized conduct. 

At a more fundamental level, this decision demonstrates that Canadian courts remain uncomfortable with imposing liability on private parties who have relied on government authorizations. Consequently, liability for infringements of Aboriginal rights and title will continue to fall to the federal and provincial governments in such cases. Nevertheless, relief granted by courts against the Crown may have important ramifications for land users and First Nations insofar as it affects government regulation of project operations or influences government-permitting decisions triggered by proposed changes to existing activities or works. 

For more information, please contact: 

or any other member of our Environmental group.