MiningWatch Client Summary – Supreme Court of Canada

Written By Brad S. Gilmour and Duncan M. McPherson

The Supreme Court of Canada released its judgment in MiningWatch Canada v. Canada (Fisheries and Oceans), 2010 SCC 2, ("MiningWatch") on January 21, 2010, establishing significant new authority in respect of environmental assessments ("EAs") under the Canadian Environmental Assessment Act ("CEAA").

Under CEAA, different levels of assessment, or "tracks", are provided for depending on the nature of the "project" being considered. Sections 21 and 21.1 of CEAA apply to projects described in the Comprehensive Study List Regulations, SOR/94-638 (the "CSL Regulations"). These sections provide that projects described in the CSL Regulations must be assessed by a comprehensive study or referred to a review panel. A comprehensive study requires public consultation and requires the consideration of more environmental factors than a screening EA ("screening").

At issue in MiningWatch was the discretion of federal responsible authorities ("RAs") to determine the appropriate assessment track for a project. Earlier jurisprudence, Prairie Acid Rain Coalition v. Canada (Minister of Fisheries and Oceans), 2004 FC 1265 (aff'd 2006 FCA 31, leave to the Supreme Court of Canada denied), held that RAs enjoyed discretion, under section 15 of CEAA, to limit the scope of CEAA assessments to those discrete elements of a larger undertaking that specifically required federal approval. Consequently, even where developments, seen in their entirety, were listed under the CSL Regulations, federal practice was frequently to limit the extent of the project assessed under CEAA to those aspects specifically related to federal jurisdiction and to conduct the assessment by screening.

The Supreme Court's MiningWatch ruling appears to overturn this approach. The Court found that RAs must first determine the track of the assessment according to the project "as proposed" by the proponent. RAs do not have discretion to scope a project in a manner that affects the level of assessment required under CEAA: "If the project as proposed is listed in the CSL [Regulations], a comprehensive study is mandatory" [MiningWatch, para. 34.]

History of the Case

MiningWatch considered the EA of the proposed Red Chris gold and copper mine in northwestern British Columbia. In 2005, a provincial EA of the entire mine concluded that, with mitigation, the project was not likely to cause significant adverse environmental effects. The mine development as a whole was described within the CSL Regulations, and federal RAs initially tracked the CEAA EA as a comprehensive study. Subsequently, however, the federal RAs revised the scope of their assessment to discrete aspects of the development, such as tailings ponds, requiring federal approvals and conducted their EA as a screening. Federal approvals were issued in 2006 on the strength of the resultant screening report. MiningWatch Canada, an environmental non-governmental organization, sought judicial review.

At trial, the Federal Court Trial Division held that an RA has no authority to scope a project that is listed within the CSL Regulations in a manner that would prevent the RA from conducting a comprehensive study. Therefore, the trial judge found the RAs were wrong to proceed with a screening of the Red Chris development. On Appeal, in 2008, the Federal Court of Appeal overturned the Trial Division, finding that the "project" for federal EA purposes means "project as scoped" by a RA and, accordingly, a comprehensive study is only mandatory where a project as scoped by the RA is listed in the CSL Regulations.

The Supreme Court Ruling

The Supreme Court of Canada overturned the Federal Court of Appeal, finding that:

a close reading of the relevant provisions of the CEAA leads to the conclusion that it is not within the discretion of the RA to conduct only a screening when a proposed project is listed in the CSL [Regulations] [MiningWatch, para. 27].

When determining whether a comprehensive study is required in lieu of a screening, RAs are instructed to consider the "project as proposed" by the proponent, and not to engage in discretionary scoping prior to determining the track of the assessment. A specific definition of the "project as proposed" by the proponent is not, however, provided by the Court. For any given development, determining these boundaries will require careful consideration.

The Court dismissed federal government arguments that depriving RAs of discretion to track projects could lead to needless duplication between federal and provincial assessments, holding that this concern was addressed under provisions in CEAA allowing federal-provincial cooperation on EAs [MiningWatch, paras. 24, 25, & 41]. The Court also clarified that, pursuant to section 15 of CEAA, RAs continued to have discretion to determine the scope of the project to be assessed, however, this scoping must occur after the required track of assessment has been determined according to the "project as proposed" by the proponent. For projects listed on the CSL Regulations, the Court found that in practice this means that the "minimum scope is the project as proposed by the proponent" and the RAs (or Minister of Environment) have the discretion to enlarge the scope when required by the facts and circumstances of the project [MiningWatch, para. 39].

The Bottom Line

The CSL Regulations potentially apply to a number of developments and project types that exceed certain threshold criteria.

In light of MiningWatch, it appears that the project proposal provided by a proponent to federal regulators may significantly influence the track of assessment under CEAA. If a proponent's proposal appears, in the first instance, to be included within the CSL Regulations, then careful consideration, attuned to the circumstances of the specific project, is recommended to ensure that any assessment under CEAA is properly tracked, to avoid potential judicial review.

The consequences of being tracked for a comprehensive study, where a screening might previously have sufficed, may include:

• Certain mandatory public consultation;
• Government funding for public participation in the EA process;
• A mandatory decision by the Minister of Environment whether the environmental assessment should be conducted as a comprehensive study by RAs or be referred to a review panel; and
• Requirements to consider additional factors under the EA, including: the purpose of the project; alternative means of carrying out the project and the environmental effects of such alternatives; and the need for, and the requirements of, a follow-up program in respect of the project.

Significantly, the Supreme Court recognized that requiring federal comprehensive studies whenever a proposed project is described within the CSL Regulations could potentially lead to duplication with thorough assessments under provincial regimes, such as those currently in place in Alberta under the Environmental Protection and Enhancement Act. The Court noted that duplication and overlap between federal and provincial regulators should be avoided. Therefore, it will become increasingly important for regulatory authorities to work cooperatively under federal-provincial harmonization agreements such as the Canada-Alberta Agreement for Environmental Assessment Cooperation, to ensure the completion of CEAA comprehensive studies and provincial processes in an efficient manner. Such agreements allow both federal and provincial regulators to use information generated by the other to reach decisions on the proposed project.

Given the MiningWatch ruling, it is important for project proponents facing comprehensive studies to recognize that cooperation between federal and provincial regulatory authorities may figure prominently in avoiding unnecessary delays in the EA process.