The Hupacasath win, but Weyerhaeuser and Brascan get rich

After months of delay, Justice Lynn Smith ofthe BC Supreme Court releasedher decision in the Hupacasath First Nation lawsuit seeking to quash the decision of the Minister of Forests that approves the privatization of 70,300 hectares ofprivate land in Tree Farm Licence 44 (TFL 44).

The ruling has far reaching implication forthe future of BC’s forests and the role of First Nations in decisions affecting lands, including private lands. 

The Court rejectedarguments by the Crown and Brascan (now Island Timberlands) that Aboriginal Title could not exist onfee simple or private land. This could have implications for rumours that theBC Liberals are considering the privatization of forests in their second term.

Madame Justice Smith held “… that theprinciples articulated in Haida Nation and Taku River can applyoutside the context of Crown land. The Crown’s honour does not exist only whenthe Crown is a land-owner. The Crown’s honour can be implicated in this kind ofdecision-making affecting private land…”

Specifically, the court ruledthat, “The decision to remove the land from the TFL was a decision withimportant ramifications for the future of that land.”

The court found that the Crownbreached its duty to “consult with the Hupacasath regarding the removal of the land fromTFL 44, and regarding the consequences of the removal of that land on theremaining (Crown land) portion of TFL 44.”   

Although the Courtdeclared that making the removal decision without consultation was inconsistentwith the honour of the Crown, the Court-like in many recentdecisions-didn’t have the courage to quash the removal and scuttle theBrascan-Weyerhaeuser deal.   

Justice Smith held that”there wouldbe significant prejudice to Island Timberlands and to Brascan if the RemovalDecision were set aside or suspended in its effects.”  

This is absurd. Given thatthe Hupacasath sought (but were denied an injunction against the sale of theselands to Brascan) it is sleazy for Brascan to now seek to avoid the fair resultbecause the reversal of the privatization that they took title with knowledge of would “seriously impact” them.  

One interesting aspect of the judgement is in a number ofsections where it confirms my previous claims ( Bulletin1/ Bulletin 2 / Bulletin 3) that decision to remove these landsgranted a windfall profit to Weyerhaeuser (one of the largest donors to the BCLiberal party). 

Back when the privatization was firstannounced in 2004, I wrote the removal …

created a windfall for Weyerhaeuser.The decision to privatize removed public oversight, reduced environmentalstandards for streams and wildlife, removed raw log export restrictions andfreed the lands for subdivision and sale…. While protection of the publicinterest in this deal has never been evident, one can’t help but wonder whateffect Weyerhaeuser’s donation of almost $450,000 to the BC Liberals since 1996might have had on the Minister’s decision… My prediction in 2004 that theprivatization would be a windfall for Weyerhaeuser was confirmed whenWeyerhaeuser quickly flipped these lands to Brascan as part of the $2.4 billionsale of their coastal operations.

Remember these are thesame lands that thousands of members of the public overwhelmingly rejected privatizing atpublic hearings back in the late 1990s.

In attempting toprevent the court from scuttling the removal, Brascan made submissions that provided incontrovertibleevidence of the benefits the BC Liberals are willing to grant to its bigdonors, such as Weyerhaeuser. 

In deciding not toquash the removal, the court refers to evidence submitted by Brascanrepresentatives, indicating that:

  • “…Brascan’s estimate is that the profit margin on the sale of timber from the privately owned timberlands business is about $25- $30 per cubic metre higher than the margin attainable from the timber within TFL 44;
  • “…Island Timberlands could face a loss of $15-$24 million annually if the Removed Lands are returned to TFL 44 because of this difference in margin.
  • “[T]he value of the Brascan purchase from Weyerhaeuser would be seriously impacted {quashing the removal]
  • “[A] key factor for Brascan in purchasing Weyerhaeuser’s property was the prospect of high quality, privately owned timberlands…”
  • “[I]n forming Island Timberlands, Brascan represented to potential institutional partners the advantages of the privately owned timberlands.”
  •  “[T]he removal of the privately owned lands from TFL 44 was a critical consideration in its decision to proceed with the transaction. Its business plan was based on the premise that it would be able to conduct two different logging operations, through two different entities, under different management regimes for the Crown land than for the private land.”

Clearly, much of the purchase price paid to Weyerhaeuser by Brascan directly results from the governments decsion to approve this privatization.

Although the courtchickened out on quashing the removal (we await the appeal), it ordered the Crown to set up a governmentto government consultation process with Hupacasath so that their interests canbe addressed. The court also set out 9conditions that Brascan must fulfill during the interim and ordered mediation tto implement the direction of thecourt if the parties cannot agree on the process or theconsultation.  

“Today is avictory, not just for the Hupacasath, but for our Forests, and all that growsand lives within them.  The Forests are our Cathedrals and we hope throughthe consultation process that the court has ordered that we will be able toprotect that which is most sacred and precious to us” said ChiefCouncillor Judith Sayers.

“The 70,000 hectares of lands that were removedis almost one third of our territory and the impacts of that removal of theland from the TFL is immense on our rights and our title,” added Sayers.

In their press release, the Hupacasath”express deep disappointment with that ruling that ‘substantial prejudice’ to third parties ismore important than constitutionally protected rights and title.” 

The Hupacasath areconsidering an appeal to get the removal quashed.

Dogwood Initiative will keep you posted as the Hupacasath move forward.

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