Delgamuukw Trial Transcripts

[British Columbia Court of Appeal 1992-06-29] British Columbia. Supreme Court Jun 29, 1992

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 2459  Reply by Ms. Mandell  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  46  47  CORAM:  Vancouver, B.C.  June 29, 1992  Taggart, Lambert, Hutcheon, Macfarlane, Wallace, J.J.A.  TAGGART,  MR. RUSH  TAGGART,  MR. RUSH  THE REGISTRAR:  Order in court.  In the Court of Appeal for  British Columbia, Monday, June 29, 1992 Delgamuukw  versus Her Majesty the Queen at bar, My Lords.  TAGGART, J.A.:  Yes, Mr. Rush.  MR. RUSH:  My Lords, a couple of technical matters.  The  Appellants have divided up their submission on reply  along the lines of their main argument, we also have  some fresh arguments to make in terms of responses.  We have organized these along the lines of our  submission, in part.  And as a consequence, a number  of counsel will be required to speak.  And we would  ask leave of the court if on reply differing counsel  can address you on this issue.  J.A.:  I think that's appropriate in this case.  Thank you.  And, secondly, My Lords, one of those  counsel will be a person not introduced to you before,  Mr. David Paterson, and he is at counsel table.  J.A.:  Mr. Paterson.  And, finally, in terms of the structure of the  arguments that you will hear over the next three days,  we have organized them in what we are calling a  speaking notes binder in reply.  And that is before  you.  It is organized by tab.  And we have keyed the  references to the speaking notes binder in reply.  And  principally what you will be required to refer to will  be the argument that is contained in that binder, as  well as the references that are keyed to it.  And Ms.  Mandell will open on our reply.  TAGGART, J.A.:  Ms. Mandell.  MS. MANDELL:  My Lords.  My Lords, I will be handling the  arguments which have been made in respect of  extinguishment.  And I will be the morning.  I would  like to advise your lordships that we do not intend in  the course of the arguments today to deal with the  Mabo case.  We are going to make full submissions in  respect to it by way of the written materials which  will be filed according to your lordship's directions.  The first point which I would like to address to  your lordships is the Royal Proclamation.  Mr. Justice  Lambert asked Mr. Bell what difference did it make to  the Province whether or not the Royal Proclamation  applied to British Columbia. 2460  Reply by Ms. Mandell  1 And we say, the Appellants, that we rely upon the  2 Royal Proclamation as a shield against all the  3 extinguishment arguments which have been made by the  4 Respondents and the Amicus.  If the Proclamation  5 applies to British Columbia, we say that all  6 extinguishment arguments which have been thus far  7 raised fall to be decided in favour of the Appellants.  8 My Lords, I am going to be at my speaking notes  9 now at page 1, paragraph 3.  I am not going to follow  10 them directly, but I will ask your lordships in  11 respect of this point to follow with me.  12 LAMBERT, J.A.:  And the reason for that submission, Ms. Mandell,  13 is that if the Royal Proclamation applies then all  14 land in the Province becomes land reserved for the  15 Indians under section 91(24)?  16 MS. MANDELL:  Whatever lands are lands reserved for Indians, my  17 lord, is a matter -- is a matter under 91(24).  But  18 the crucial point that we stress isn't the scope of  19 the territorial reach of the Proclamation, that is for  20 the purposes of this argument.  It still remains to be  21 proved what lands belong to the Indians under 91(24),  22 but primarily in respect of the consent provision.  23 Because whatever lands do belong to the Appellants we  24 say have to be acquired by consent.  25 And at paragraph 3, I say that the Appellants have  26 submitted that Part IV of the Royal Proclamation  27 placed constraints on the Crown's power.  These  28 constraints became the terms upon which the Crown  29 could peacefully settle the continent then occupied  30 throughout by aboriginal nations who had been  31 organized in their homelands for thousands of years  32 before the coming of the Europeans.  We say the  33 constraints are twofold:  Regarding Crown title, the  34 Crown's title is burdened by aboriginal title.  And  35 regarding Crown's sovereignty, the Crown recognized  36 the autonomy of the aboriginal nations and accepted a  37 duty to protect Indian lands from encroachment and to  38 ensure that Indian consent would be sought and  39 obtained for the taking of unceded lands.  And these  40 are the constraints on the Crown which we say were  41 part of the constitutional instrument which we say  42 that the Royal Proclamation is.  43 Now, the Amicus has argued that in the  44 pre-Confederation period, they call it Colonial  45 Instruments II, or in the alternative, the various  46 land legislation ordinances extinguish title.  And we  47 say that if we are right that the Royal Proclamation 2461  Reply by Ms. Mandell  1 applies to British Columbia as an instrument  2 applicable then Part IV operates in all these  3 pre-Confederation land laws must be read down to the  4 extent necessary to avoid repugnancy with Imperial  5 law.  And so we say in the pre-Confederation period  6 the operation of the Proclamation as an instrument  7 stands against the Amicus' argument.  8 For the period following Confederation, the  9 Respondents and the Intervenors argued that some of  10 the Appellants' right were extinguished based on  11 implied extinguishment tests founded on adverse  12 dominion.  13 Well, we submit that if the Proclamation applied  14 in British Columbia after Confederation it was carried  15 forward into Section 91(24) of the Constitution Act.  16 And in the words of Lord Denning in the Secretary of  17 State case:  18  19 "It was an unwritten provision of 91(24) ."  20  21 We say that the Proclamation states that the method of  22 acquiring Indian title is by consent.  Thus if it  23 applies to British Columbia as an instrument, the  24 Crown may only acquire Indian lands by consent.  Now,  25 we don't challenge the power of the Crown acting  26 through the appropriate legislative body to repeal the  27 Proclamation, before or after Confederation.  However  28 no repeal of the Proclamation has occurred.  And until  29 such repeal takes place, the consent provisions of the  30 Proclamation bind the Crown as to the means of  31 arriving at an accommodation with the Indians where  32 unceded land is required for settlement.  33 And we say as a further significance that if the  34 Royal Proclamation does apply to British Columbia it  35 pours content into the protective role assigned to the  36 Federal government under 91(24) .  The Appellants would  37 have a clear legal reference point from which they  38 could compel the Federal government to engage in  39 positive protective measures with respect to unceded  40 lands and to establish a treaty process between  41 themselves and the Province.  42 Now, the Province was further asked by your  43 lordship whether the consent provisions of the  44 Proclamation could be read as he has submitted not to  45 in fact require consent.  And his arguments were first  46 that reading the Proclamation it only applied to  47 existing colonies.  And we've replied to that point in 2462  Reply by Ms. Mandell  1 the reply factum.  And at paragraph 9 I have indicated  2 the paragraphs.  And we say that if the Royal  3 Proclamation applied prospectively then as and when  4 British Columbia became a colony then the consent  5 provisions would apply in respect of it.  So really  6 the argument is hinged on whether or not our  7 prospective application argument suceeds.  8 The Province said also that if you read paragraph  9 4(a), which is the consent provision, that their  10 argument is that its directed to purchasers and not to  11 the Crown.  And at paragraph 10 we disagree.  We say  12 that in the preamble to Part IV, aboriginal title is  13 described as lands "not having been ceded to or  14 purchased by us", "us" being the Crown.  In paragraph  15 4(a) it is to the Crown's interests, "(Our Interests)"  16 that the phrase is directed and the Crown's justice,  17 "(Our Justice)" which is in issue.  It is the Crown  18 that prohibits private purchases in lands which the  19 Crown "(We)" have thought proper to allow settlement.  20 It is the Crown who must establish the treaty process,  21 and it is the Crown who receives the Indian title once  22 the burden of aboriginal title is released.  The  23 language "(the same should be purchased only for Us in  2 4 Our Name)".  25 We say that what paragraph 4(a) states is really  26 the common law principle that aboriginal title is an  27 inalienable except to the Crown.  And that your  28 lordships have been taken to the passage in Guerin  29 where Chief Justice Dickson held that this aspect of  30 Indian title, which was recognized in the Royal  31 Proclamation, gave rise to fiduciary obligations,  32 which are binding on the Crown.  33 It is the Appellants' further position that the  34 Royal Proclamation, even if it doesn't apply as an  35 instrument, is a statement of fundamental principles  36 of the common law, and that even if the Royal  37 Proclamation does not extend to British Columbia,  38 those principles embodied therein do.  If the question  39 for extinguishment is addressed on the basis that  40 aboriginal rights are common law rights (as opposed to  41 rights embodied in a constitutional instrument having  42 the force of Imperial statute in the Colony) questions  43 of extinguishment by clear and plain sovereign  44 intention arise to be decided.  45 The Province was asked by your Lordship whether or  46 not Mr. Justice Johnson's decision in Sikyea is  47 binding on the Court.  In reasons which were affirmed 2463  Reply by Ms. Mandell  1 by the Supreme Court of Canada, Mr. Justice Johnson  2 stated that while the Royal Proclamation did not apply  3 to the lands in question:  4  5 "...that fact is not important because the  6 government of Canada has treated all Indians  7 across Canada, including those living on lands  8 claimed by the Hudson's Bay Company, as having  9 an interest in the lands that required a treaty  10 to affect its surrender."  11  12 And the Province has argued that this passage is  13 to be considered in light of the unusual facts of the  14 case where there in Sikyea the Federal government  15 controlled the lands in question and could bind itself  16 to a treaty process.  And they further argued that it  17 was obiter.  18 And we say that this passage is not about the  19 power of the Federal government to bind itself to a  20 treaty process.  The question of the power of one  21 level of Government, or a Crown agent, to bind the  22 Crown to a treaty has been before the Court in other  23 cases.  That issue wasn't before the court in Sikyea.  24 It was before the Court, your lordships are aware, in  25 White & Bob and Saanichton Marina.  There the question  26 was whether or not Douglas had the power to bind the  27 government to a treaty process.  28 And it was also before the court in Baptisse, a  29 case I will be taking your lordships to today, where  30 the question was whether or not the Ontario government  31 could bind a treaty because of its participation in  32 the process.  But that wasn't the case in Sikyea.  33 The issue which the above passage is addressing is  34 the existence and legal strength of the rights of the  35 defendant.  That issues the ratio.  The Court was  36 required to assess the legal strength of the hunting  37 rights against the Migratory Birds Convention Act, and  38 determine the consequences.  The hunting rights have  39 been recognized by the Crown as an interest in their  40 lands requiring a treaty to affect its surrender, and  41 were recognized in Treaty 11, and in the Natural  42 Resources Transfer Agreement.  43 And we submit that Mr. Justice Hall, when he  44 adopted Mr. Justice Johnson's reasons on this issue,  45 affirmed the principles expressed in the Royal  46 Proclamation were binding principles of the common  47 law. 2464  Reply by Ms. Mandell  1 Now, my lord, I would like to turn to Colonial  2 Instrument II, or what my friends have Calder II.  I  3 wanted to explain that the reason why I have not used  4 the word Calder II is that some of the Indian people  5 have taken objection to using Frank Calder's name, a  6 man who fought all of his life for the recognition of  7 aboriginal rights, to be placed on an instrument which  8 is being said to extinguish the rights.  And they have  9 asked us to change the terminology which is being  10 employed, and it is for that reason that I do.  11 Both the Province and the Amicus advance theories  12 about Colonial Instrument II to argument for the  13 extinguishment of aboriginal rights.  The Appellants  14 submit that these theories are wrong in law, and they  15 are internally inconsistent.  16 My Lords, I would like to advise you that from  17 paragraphs 18 to 33 I set out the theories which both  18 the Province and the Amicus have advanced in respect  19 of Colonial Instrument II.  And they basically advance  20 the proposition that this instrument expresses an  21 extinguishment of aboriginal ownership.  That's the  22 Province's position.  Or the Amicus goes further and  23 says that applying Mabo, the declaration of the land  24 in fee belonging to the government encompasses all  25 aboriginal rights.  And from thereafter it is only  26 those rights which the Crown recognizes, which they  27 say is village sites, and the right to hunt on  28 unoccupied lands in common with others, and the right  29 otherwise to be governed by the law of the Province.  30 These rights having been then recognized by the Crown,  31 these are the only rights which remain.  32 And I won't go into all of the various theories  33 which the Amicus and the Province advance on this.  I  34 would ask your lordships to read those paragraphs.  I  35 will say about those theories that they are both  36 internally inconsistent and inconsistent to each  37 other.  And I would ask your lordships to consider the  38 arguments which are spelled out in those paragraphs.  39 And if I could take you to paragraph 33, I would  40 like to advance what the Appellants reply is in  41 respect of the correct thesis involving Section 1 of  42 Colonial Instrument II.  And we say that this is in  43 reply to basically the submission by both of them that  44 in declaring that the Province owns the lands in fee  45 the Crown was essentially encompassing all interests,  46 and no other interests could be read simultaneously or  47 consistently with this and was thereafter somehow 2465  Reply by Ms. Mandell  1 subsuming the aboriginal interest within that  2 declaration.  3 We say that this is a completely mistaken view of  4 what Crown title is.  I begin at paragraph 34.  Crown  5 ownership is defined in the law of real property, as  6 follows:  7  8 "Although in practice land is commonly, and  9 correctly, described as owned by its various  10 proprietors, English land law still retains its  11 original basis, that all land in England is  12 owned by the Crown.  A small part is in the  13 Crown's own occupation; the rest is owned by  14 tenants holding either directly or indirectly  15 from the Crown.  (No land without a lord):  no  16 land in England is allodial, i.e. owned  17 independently by a subject and not 'held of  18 some lord."  19  20 Thus, Crown ownership which is what was declared  21 in Colonial Instrument II stems from the concept that  22 all lands in England are owned by the Crown and that  23 the Crown grants from its title to others.  24 As Mr. Williams correctly pointed out, aboriginal  25 title has nothing to do with England owning land, but  26 has everything to do with the fact that aboriginal  27 people were the owners of their homelands, before the  28 assertion of Crown sovereignty.  The Appellants say  29 that aboriginal rights to the land are neither derived  30 from Crown grants; nor are they defined by reference  31 to notions of English property law; nor does  32 aboriginal title have any place in the Torrens system.  33 This latter point we say was settled in the Uukw  34 case.  That actually should be Delgamuukw.  It was an  35 abbreviated reference to the plaintiff in this action.  36 The Court of Appeal refused to register a lis pendens  37 in respect of the rights claimed in this action  38 against lands in the claimed territory.  After  39 reviewing the common law characteristics of aboriginal  40 rights as set out in the judgment of Guerin, this  41 court concluded:  42  43 "It is enough to observe that aboriginal title  44 can have no place in a Torrens system which has  45 the primary object of establishing and  46 certifying the ownership of indefeasible titles  47 and simplifying transfers thereof.  I conclude 2466  Reply by Ms. Mandell  1 that s. 213 requires the claim of a registrable  2 estate or interest in land and what is claimed  3 in this case is not registrable."  4  5 Now, we say it follows that where the Crown  6 asserts that it owns the land in fee it is asserting  7 its own estate.  Such a declaration could not include  8 the aboriginal rights which were not included within  9 the Crown's estate.  In the words of Lord Watson in  10 St. Catherine's Milling, the estate of the Crown is  11 encumbered but does not include the Indian title.  I  12 put in the words "but does not include the Indian  13 title".  After finding the Indian interest to be in  14 section 109, Lord Watson said:  15  16 "The fact that the power of legislating for  17 Indians, and for lands which are reserved to  18 their use, has been entrusted to the Parliament  19 of the Dominion is not in the least degree  20 inconsistent with the right of the Province to  21 a beneficial interest in these lands, available  22 to them as a source of revenue..."  23  24 And I rely upon these words:  25  26 "...whenever the estate of the Crown is  27 disencumbered of the Indian title."  28  29 Now, in the Uukw case, the court said:  30  31 "...if the respondents are successful, the  32 estate or interest they establish will depend  33 upon the evidence adduced."  34  35 This statement is consistent with Kruger and Manuel  36 and Amodu Tijani, that the description of the  37 aboriginal right will take its shape from the  38 particular laws and customs of the aboriginal society.  39 If, on the facts, the aboriginal rights can be  40 characterized as owners (which the Appellants have  41 urged upon this court) then the aboriginal right is  42 properly characterized as owners and that right will  43 be the interest which burdens the Crown title.  If  44 another system of Indian tenure gives rise to a  45 conclusion that the aboriginal rights, properly  46 characterized are identified in some other way, some  47 different form of aboriginal tenure will be declared. 2467  Reply by Ms. Mandell  1 The fact that the aboriginal rights might be  2 characterized as owners, or in some other way, has  3 nothing to do with the declaration by the Crown of its  4 estate, by Proclamation, to enable Crown officers to  5 pass interests derived from Crown's estate to third  6 parties.  7 Thus, when by declaration, Douglas purported to  8 declare the ownership of the Crown lands in fee, and  9 then created a registration system for Crown grantees,  10 the registration system established in British  11 Columbia did not contemplate registration of  12 aboriginal title.  Therefore registration statutes,  13 such as Colonial Instrument II, cannot manifest a  14 clear and plain intention to extinguish those rights  15 and interests, unless that intention, that is the  16 intention to extinguish, is expressly stated.  17 Now, on the issue of the clear and plain intention  18 to extinguish, the Appellants have submitted that  19 Douglas had no power to extinguish aboriginal rights  20 in the Colony, and specifically Douglas could not do  21 what is suggested by the Amicus in Colonial Instrument  22 II.  And I have made reference to those arguments.  23 The Appellants' argument on Douglas' limited authority  24 was not specifically addressed by the Amicus.  They  25 cited the authority of what they call the Deadman's  26 Island case to say that Douglas' power was ought  27 autocratic.  However, the fact that Douglas did not  28 initially convene a legislative assembly in the colony  29 does not mean that his power was not proscribed by his  30 Commission, Letters Patent and Specific Instructions  31 from England.  And, in fact, the Deadman's Island case  32 affirmed this standard constitutional principle.  33 I say further, the Colonial Instrument II does not  34 demonstrate any clear sovereign intention to  35 extinguish.  There is no language in the Proclamation  36 concerning Indians, Indian lands, or aboriginal  37 rights.  The Proclamation sets out the method to be  38 pursued with respect to alienation and acquisition of  39 agricultural lands, and of lands proposed to sites for  40 towns in the new colony of British Columbia, as well  41 as other matters.  42 The Proclamation was transmitted to Lytton.  The  43 transmission dispatch was concerned mainly with  44 justifying a low price for land and contains no  45 specific reference to Indians or Indian lands.  It  46 says nothing about the purpose of the Proclamation to  47 extinguish title. 2468  Reply by Ms. Mandell  1 And I won't take your lordships to it, but at tab  2 2 of the materials which I have handed up to you I  3 have set out some of the exhibits which I have made  4 reference to in paragraphs 43 to 45.  And we say that  5 there is -- no extinguishment of rights can be  6 concluded.  7 Finally, the Appellants have argued that before --  8 HUTCHEON, J.A.:  Before you go on, Ms. Mandell, could I ask you  9 whether the trial judge dealt with that question of  10 Douglas' authority?  11 MS. MANDELL:  My lord, I will get you the passage at the break.  12 HUTCHEON, J.A.:  Thank you very much.  13 MS. MANDELL:  He basically, in my submission, avoided it.  14 TAGGART, J.A.:  What was the tab number in the reference book,  15 2?  16 MS. MANDELL:  2.  My Lords, I am at the bottom of page 12.  17 Finally, the Appellants have argued that there is no  18 inconsistency between the declaration that "all lands  19 in British Columbia and all mines and minerals belong  20 to the Crown in fee" and the coexistence of aboriginal  21 title.  22 In Calder Mr. Justice Hall, in discussing  23 aboriginal title, said this:  24  25 "This is not a claim to title in fee but is in  26 the nature of an equitable title or interest, a  27 usufructuary right and a right to occupy the  28 lands and to enjoy the fruits of the soil, the  29 forest and of the rivers and streams which does  30 not in any way deny the Crown's paramount title  31 as it is recognized by the law of nations."  32  33 Then later on commenting on Colonial Instrument II,  34 and the declaration of the lands belonging to the  35 Crown in fee, Mr. Justice Hall stated:  36  37 "The Appellants do not dispute the Provinces'  38 claim that it holds title to the land in fee.  39 They acknowledge that the fee is in the Crown.  40 The enactments just referred to merely state  41 what was the actual situation under the common  42 law and add nothing new or additional to the  43 Crown's paramount title and they are of no  44 assistance in this regard to the  45 respondents..."  46  47 And we say to you, My Lords, that if Section 1 of 2469  Reply by Ms. Mandell  1 Colonial Instrument II is capable of being read, as  2 Mr. Justice Hall and the two judges who wrote with him  3 read it, that any doubt or ambiguity must be resolved  4 in favour of the Appellants.  5 I make a final point on this issue, My Lords.  The  6 Appellants submit that the argument of the Amicus --  7 and perhaps I could turn you back to paragraph 30.  I  8 want to introduce you to this argument again.  It is  9 at page 8.  I will begin with paragraph 29.  The  10 Amicus argued that Colonial Instrument II extinguished  11 all pre-existing aboriginal rights.  They relied upon  12 the judgment of Mr. Justice Brennon in the Mabo case.  13 I'm sorry, My Lords, are you with me?  And argued that  14 upon the assertion of sovereignty the Crown acquired  15 the radical title, a title which is different from the  16 beneficial ownership of the lands so acquired.  The  17 beneficial title remained with the Indians.  However,  18 as an incident of its sovereignty, it was open to the  19 Crown to acquire the beneficial ownership.  This, the  20 Amicus argues was done, when Douglas proclaimed  21 Section 1.  22 The Amicus proceeds from this point to determine  23 the intention of the Crown regarding the existing  24 aboriginal rights.  In this regard, the Amicus argues  25 that the intention of the Crown was made known  26 regarding the Indian interests which could co-exist  27 with Crown title by doing these things.  They say:  28 Formulating the land policy to protect village sites  29 and cultivated fields which is the preserve policy;  30 making unoccupied lands available for hunting and  31 fishing in common with others; and determining that  32 the Indian people became subjects of the Crown and  33 were governed by the general laws of the colony.  34 I say that the Amicus' argument on extinguishment  35 in the colonial period by land legislation makes  36 little sense in light of this analysis.  The only  37 remaining rights to extinguish after Colonial  38 Instrument II, according to that analysis, would be  39 village sites and cultivated fields which the Amicus  40 does not challenge, as they seek to uphold the  41 decision of the trial judge in this regard.  42 Now, if I could ask your lordships to turn back to  43 page 13, paragraph 50.  We say that the foundation of  44 the Amicus argument is in the recognition theory which  45 found favour in the B.C. Court of Appeal in Calder.  46 That theory stated that the aboriginal rights amounted  47 to only those rights which were recognized by the 2470  Reply by Ms. Mandell  1 Crown.  In Calder, this resulted in extinguishment of  2 all rights, this is in respect of Mr. Justice Judson  3 and others decision, except rights to village sites  4 and cultivated fields, which are the reserves.  5 Indians were otherwise permitted to hunt and fish  6 on -- it should be unoccupied lands in common with  7 others, and were governed by the general laws of the  8 colony.  This recognition theory was finally  9 repudiated by this court in Meares Island and Sparrow  10 and by the Supreme Court in Sparrow.  11 Now, at trial, the Province argued that because  12 B.C. was a settled colony, the aboriginal rights of  13 the Appellants were defined only by those rights which  14 had been recognized by the Crown, expressed in the  15 policy of the colonial period.  This resulted in the  16 recognition only of rights to villages and cultivated  17 fields, which is the reserves.  Indians were promised  18 the right to hunt and fish on -- it should be  19 unoccupied lands in common with others, and were  20 governed by the general law of the colony.  Now, the  21 trial judge ruled against the settled colony theory,  22 but adopted the result of the Province's arguments.  23 Reserves were excluded from his finding of  24 extinguishment.  Rights to hunt and fish continued  25 over unoccupied Crown lands.  But by the finding of a  26 fiduciary duty, the rights could not be arbitrarily  27 interfered with.  However, these rights, and all  28 others were subjects to the general law of the colony.  29 In their argument on appeal (and I say presumably  30 as a result of the finding of the trial judge on the  31 settled colony point), the Amicus, formerly counsel  32 for the Province, modified their settled colony theory  33 and advanced the argument that all aboriginal rights  34 and title, although pre-existing, were limited to  35 those lands occupied and possessed in accordance with  36 English property law concepts.  The result was the  37 continuation of rights only to village sites and  38 cultivated fields, which is the reserve policy.  They  39 sought to uphold the trial judge's other findings,  40 including the fiduciary duty.  41 Now, Mabo clearly rejected the settled colony  42 theory, and the Amicus abandoned their reliance on it.  43 However, based on their interpretation of Mabo they  44 developed a knew theory based on Colonial Instrument  45 II.  This theory I have already read to you.  The  46 result of this new theory is exactly the same for the  47 Appellants had the doctrine of recognition, or either 2471  Reply by Ms. Mandell  1 of their two versions of settled colony theory -  2 reserves, hunting and fishing in common with others,  3 subjects to the general laws of the province.  In  4 other words, the result will be the same no matter  5 which of the three theories they have advanced.  6 We say that the doctrine of recognition, and the  7 settled colony theories, have both been rejected by  8 the high courts of this country, and Australia.  The  9 Appellants urge this court to do likewise with the  10 Amicus' new theory based on Colonial Instrument II.  11 Now, My Lords, I would like to address two other  12 points in the colonial period before moving into  13 adverse dominion.  The one is the question of the  14 reserve issue.  The Amicus relies on the trial judge's  15 findings that aboriginal rights to land outside  16 reserves were extinguished in the colony prior to  17 1871.  From this they argue that there was no finding  18 of blanket extinguishment.  19 I point out that there were no reserves  20 established in the Appellants' territory before 1871.  21 And on this point I say neither the trial judge's  22 findings, nor the Amicus submission bear on the case  23 at bar.  24 Now, I would like to address their point where  25 they say that the intention to extinguish is a legal  26 finding.  And they say it is a finding of fact.  The  27 Amicus submitted that the question as to the Crown's  28 intention to extinguish aboriginal title in the  29 colonial period is a finding of fact and that we, the  30 Appellants, have pointed to no overriding error with  31 respect to that finding.  The Appellants say that the  32 question of the sovereign intention to extinguish is a  33 question of law, involving statutory construction as  34 to whether the legislation indicates a clear and plain  35 intention to extinguish.  36 In its factum, the Appellants have taken the --  37 I'm sorry, the Amicus has taken the position that the  38 inquiry in the colonial period is to interpret the  39 legislation.  Historical material has been advanced,  40 they say, to put the relevant legislation in its  41 proper context, but not to displace the inquiry  42 involving the interpretation of legislation.  And this  43 was made clear in their reply factum which they  44 incorporated as part of this case in Dick and  45 Alphonse.  46 In reply to Mr. Justice Lambert's question, Mr.  47 Plant clarified that it is the statute itself which 2472  Reply by Ms. Mandell  1 must affect extinguishment; he says he relies on  2 sources outside the statute only to find the  3 Sovereign's intention.  He repeated the point later,  4 by saying that it is not the "weight of history" which  5 extinguishes - its function is only to demonstrate the  6 clear and plain intention.  7 Because it is alleged that the sovereign acted in  8 its legislative capacity to extinguish title, then it  9 is in those legislative acts that this court must find  10 the requisite intention.  In other words, the task is  11 to find the sovereign's legislative intention which  12 requires construing the statute itself.  In the  13 result, Amicus asked the court to adopt a method of  14 statutory construction which is completely at odds  15 with the common law rules.  The room for extrinsic  16 evidence in construing a statute is limited.  17 Subjective understanding or intentions of legislators  18 and officials is an important task for historians, but  19 is essentially irrelevant to a court seeking to  20 determine legislative intention.  And we've set out  21 where in our reply we have elaborated this point.  22 The "weight of history" really means the actions  23 of government and officials over the years.  That if  24 those were uniform, which they were not in this case,  25 that would not prove legislative intention.  26 Government actions or intentions cannot prove  27 legislative intention because government or its  28 officials may not have achieved their objectives in  29 the legislaiton actually enacted, but further, after  30 the legislation was enacted, the government or  31 officials may have acted beyond their powers.  Thus,  32 statutory construction and historical research are  33 distinct tasks.  34 Amicus characterizes the trial judge's conclusions  35 about the intention to extinguish as findings of fact.  36 On June 26th Mr. Willms said that the trial judge  37 himself treated intention as a question of fact.  38 Amicus argues that this court could only overrule the  39 trial judge on this issue if he finds palpable error.  40 We say the premise is wrong.  And so too is the  41 conclusion.  Legislative intention is a matter of  42 statutory construction - it raises questions of law,  43 not facts.  Even if some factual findings need to be  44 made in the course of construing the statute, the  45 question of legislative intention remains one of law  46 and on which this court must overrule the trial judge  47 if his conclusion was wrong. 2473  Reply by Ms. Mandell  1 And, finally, on the pre-Confederation period I  2 would like to reply to the point raised by the Amicus  3 that there is an inconsistency between the intention  4 to extinguish and the intention to settle the colony.  5 We say there is no legal or historical logic which  6 supports the underlying premise of the Amicus'  7 argument that the colonial government must have  8 intended the extinguishment of aboriginal title,  9 because of its intention to settle the colony.  The  10 two intentions need not go together.  In central  11 Canada, the Prairies and northeast B.C. treaties were  12 negotiated in respect of aboriginal title, long after  13 the enactment of legislative schemes for settlement  14 and land registration, and many years after settlers  15 took up land.  The same pattern has continued in  16 recent years in northern Quebec, Yukon and the  17 Northwest Territories.  Even an intention to give  18 secure unencumbered title to settlers was not  19 necessarily inconsistent with an intention to deal  20 with aboriginal title.  Government was, and still is,  21 able to address aboriginal title even after making  22 grants to third parties.  By doing so, government will  23 complete the steps necessary to pass secure and  24 unencumbered title to its grantees.  25 My lord, I would like to now get into the question  26 of adverse dominion.  It is going to -- the balance of  27 my submissions will address the post-Confederation  28 period.  29 This section will reply to the arguments of  30 Canada, the Province and the Amicus, that the Province  31 is competent to extinguish aboriginal rights through  32 the enactment of gen -- laws of general application in  33 conflict with those rights.  The Appellants address  34 these issues in the Appellants' reply factum.  And I  35 have set out where you can find these submissions.  36 The Respondents and the Amicus urge upon this  37 court the proposition that aboriginal rights and title  38 may be extinguished by legislation and administrative  39 acts of the Province.  They find the provincial power  40 of extinguishment as the implied consequence of  41 provincial acts whose purpose was not the  42 extinguishment of aboriginal rights.  They take the  43 position that an act of the Province inconsistent with  44 an aboriginal right distinguishes that right.  On the  45 strength of these submissions, Canada includes almost  46 200 pages of appendices to its factum out of which the  47 extinguishment of such rights is sought to be 2474  Reply by Ms. Mandell  1 inferred.  Canada goes so far from the "clear and  2 plain" test as to propose a reference to the registrar  3 where "the legislative use could have the potential to  4 extinguish aboriginal rights".  5 The Province argues that all fee simple grants are  6 inconsistent with and therefore extinguish aboriginal  7 rights; Canada in oral argument took the position that  8 some fee simple grants may not extinguish rights.  9 The Province and the Amicus analogize  10 extinguishment to expropriation and conclude that  11 since title is provincial, the Province, and not  12 Canada, may extinguish aboriginal proprietary rights.  13 The Province and the Amicus also rely on the  14 Province's legislative jurisdiction over natural  15 resources to permit the extinguishment of aboriginal  16 rights by incidental consequences.  17 Notwithstanding the unequivocal judgment in  18 Sparrow the Amicus persists in maintaining that the  19 Province has established aboriginal title by  20 comprehends civil regulating resource extraction.  21 The Respondents and Amicus rely on s. 88 to give  22 effect to provincial legislation which would  23 extinguish aboriginal rights.  24 The Amicus also urges that by the fact of the  25 Terms of Union and provincial compliance with those  26 terms, aboriginal title outside Indian reserves was  27 extinguished.  28 Now, I am going to set out in the next two pages  29 our summary of our responses.  The first is a  30 constitutional point and the second concerns the test  31 for extinguishment and whether adverse dominion  32 evidences a clear and plain intention to extinguish.  33 And we make the following points.  We say on the  34 constitutional point that the constitutional  35 arrangements which were made at Confederation  36 protected aboriginal rights by limiting the respective  37 powers of the Province and the Federal Government in  38 relation to Crown title and Crown sovereignty through  39 the division of powers.  40 We say that the limitation basically was this,  41 that Crown title at and since Confederation was put  42 into the Province, but the title of the Crown to lands  43 in B.C. is in the Province and that title has been  44 impaired or burdened by aboriginal title to the extent  45 that such title has not been extinguished by treaty or  46 otherwise.  And that's section 109.  47 Regarding Crown sovereignty, we say that the 2475  Reply by Ms. Mandell  1 federal Crown has exclusively legislative and  2 administrative powers in respect of Indians and their  3 lands coupled with a legally enforceable duty to  4 protect and safeguard aboriginal rights and title.  5 And this is 91(24) .  6 And I say, although I don't mention it here, that  7 it is the Imperial Parliament that retains the power  8 to amend the Constitution.  And so you have the  9 Federal Government assigned exclusively the  10 legislative jurisdiction in respect of upholding the  11 Crown obligations and you have -- but they have no  12 Indian title.  And you have the Province's title  13 burdened by Indian title.  But they, the Province,  14 have no power to disencumber it.  That rests with the  15 Feds.  And it is by this division of powers that  16 aboriginal title was protected by the BNA Act.  17 We say that since the Confederation, the Province  18 has had no power to extinguish aboriginal rights or  19 title.  We say that intent must be express, and  20 express extinguishment by the Province is ultra vires  21 on its face.  In the alternative, even if  22 extinguishment could be implied, it cannot here be  23 implied in view of the paramount operation of federal  24 statute, the paramount operation of federal common  25 law, and the necessary limits of what is incidental to  26 the exercise of provincial powers.  We say s. 88 does  27 not permit provincial extinguishment of aboriginal  28 rights.  29 We say further that nothing in the Terms of Union  30 or in the reserve-creating process resulted in the  31 extinguishment of aboriginal rights, and that the  32 Appellants make the submission that adverse dominion  33 does not satisfy the clear and plain test.  34 Now, My Lords, for the balance of the morning I  35 will reply in respect of points 1 (a), (c) and (d).  36 And David Paterson this afternoon will address point  37 (b).  I am going to begin first with the  38 constitutional point.  I say that --  39 LAMBERT, J.A.:  I didn't follow how you were dividing that.  40 MS. MANDELL:  My Lords, all — I'm sorry.  41 LAMBERT, J.A.:  Maybe you can do it again.  42 MS. MANDELL:  I am going to deal with (a), that is what is the  43 basic scheme of Confederation, (c) the Terms of Union  44 and (d) adverse dominion doesn't satisfy the clear and  45 plain test.  And Mr. Paterson this afternoon is going  46 to argue the fact that the power of the Province is  47 limited.  It cannot extinguish aboriginal rights or 2476  Reply by Ms. Mandell  1 title.  He will develop essentially the argument that  2 I am going to set up for him in more detail.  3 LAMBERT, J.A.:  Yes.  Thank you.  4 MS. MANDELL:  My Lords, this division of power protection was,  5 your lordships will see, mirrors the constraints which  6 the Crown assumed with the Royal Proclamation.  And if  7 your lordships would simply note back to paragraph 3  8 of the speaking notes when I am talking now about the  9 constraints on Crown title and the constraints on  10 Crown sovereignty, your lordships will see a mirror  11 with those two constraints which were assumed by the  12 Crown and stated in the Royal Proclamation.  And I am  13 going to begin first with the constraint on the  14 Crown's title.  And this is expressed in section 109.  15 Under the terms of the Constitution Act,  16 provincial Crown lands are subject to the burden of  17 aboriginal title where such has existed and remains  18 unextinguished.  Far from providing a platform for  19 provincial extinguishment by the exercise of  20 provincial proprietary rights, those latter rights  21 cannot themselves be fully exercised while the  22 aboriginal title remains unextinguished.  23 And I set out 109.  And your lordships are not  24 aware of the words that the Provinces get their Lands,  25 Mines, Minerals and Resources subject to any interest  26 other than at that point of the Province in the same.  27 And it is those words "and to any interest other than  28 that of the province in the same" that is the  29 St. Catherine's Milling case said aboriginal title is  30 applicable.  31 While the underlying legal title to lands subject  32 to unextinguished aboriginal title lies in the  33 Province, that provincial estate carries with it no  34 right to the use or benefit of the land prior to it  35 becoming disencumbered of the aboriginal interest.  36 And your lordships will recall that the word  37 "disencumbered" was a word used by Lord Watson in that  38 case.  And I have already taken you to that passage  39 earlier in the speaking notes that is set out at page  40 38.  41 Mr. Justice Hall in Calder noted that in St.  42 Catherine's Milling the Court was clear that the  43 Province's estate became:  44  45 "...a plenum dominion whenever that title was  46 surrendered or otherwise extinguished."  47 2477  Reply by Ms. Mandell  1 Mr. Justice Hall in Calder also cited the majority  2 judgment of Mr. Justice Ritchie in St. Catherine's  3 Milling:  4  5 "I am of opinion, that all ungranted lands in  6 the Province of Ontario belong to the Crown as  7 part of the public domaine, subject to the  8 Indian right of occcupancy in cases in which  9 the same has not been lawfully extinguished,  10 and when such right of occcupancy has been  11 lawfully extinguished absolutely to the Crown,  12 and as a consequence to the Province of  13 Ontario."  14  15 In A.G. Canada v. Ontario, Lord Watson held that  16 to be an interest in land to which provincial title  17 was subject, the interest would have to be "some right  18 or interest in a third party, independent of and  19 capable of being vindicated in competition with the  20 beneficial interest of the old province."  21  22 That Indian interest which is capable of being  23 vindicated in competition with the Crown title held by  24 the Province was described by Mr. Justice Dickson in  25 Guerin.  26  27 "Indians have a legal right to occupy and  28 possess certain lands, the ultimate title to  29 which is in the Crown."  30  31 It will be submitted that this interest is a  32 matter of federal common law, and that the Province  33 cannot unilaterally unburden itself of an encumbrance  34 to its title.  Aboriginal rights are interests in  35 lands opposable to that of the Province.  To use the  36 words of Lord Watson, "capable of being vindicated in  37 competition with the interests of the province".  38 Thus, while it is true that the Constitution  39 establishes that it is the Province that holds Crown  40 title and may receive the benefits derived thereof, it  41 is equally true that the Province must first be  42 released from the burden of aboriginal title which,  43 until surrendered or extinguished, is reserved from  44 the control of the Province.  45 Now, the Province, Mr. Taylor, argues that section  46 109 does not affect their legislative power.  And he  47 relies heavily on the Smith case.  And we say that in 2478  Reply by Ms. Mandell  1 Smith the Court only discussed the limits of  2 provincial power reflected in 91(24) because in Smith  3 the case did not concern the burden on the Province  4 under 109.  It is wholly concerned with the  5 constitutional position after extinguishment - which  6 government has the jurisdiction to dispose of a  7 reserve after an absolute surrender.  It is well  8 established that before surrender, the power was in  9 the federal Crown, not the province, because of 91(24)  10 the focus of the Court's concern in Smith was whether  11 that section 91(24) power continued after the  12 surrender.  Section 109 --  13 LAMBERT, J.A.:  Excuse me.  I am going to stop you at the end of  14 that paragraph.  In paragraph 82 you started off by  15 saying "it will be submitted that this interest is a  16 matter of federal common law".  17 MS. MANDELL:  Yes.  18 LAMBERT, J.A.:  Are you going to come and argue later the  19 Roberts case on federal common law?  20 MS. MANDELL:  Mr. Paterson will be making that argument, my  21 lord.  22 LAMBERT, J.A.:  I will wait until, then.  23 MS. MANDELL:  Section 109 is relevant in the case at bar because  24 it is a constitutional confirmation that aboriginal  25 title qualifies the provincial Crown's title until it  26 is validly extinguished.  There is nothing in the  27 reasoning in Smith which is contrary to that.  It was  28 not necessary for the court to discuss section 109 in  2 9 Smith.  30 Now, my lord, I am going to next -- so I say that  31 the first constraint on the Crown's title, the  32 qualification, that which was first identified and  33 accepted in the Royal Proclamation, carried forward  34 into Confederation under section 109.  And my second  35 point is that section 91(24) provides for exclusive  36 federal legislative jurisdiction over "Indians and  37 lands reserved for Indians".  And Mowat confirmed that  38 this grant of jurisdiction comprehends administrative  39 as well as legislative powers.  40 My lord, I think Mr. Justice Macfarlane at one  41 point you asked, well, why is it that section 91 --  42 what was the purpose of putting section 91(24) as  43 federal jurisdiction over Indians?  And I want to  44 address that by reference to an exhibit in some of the  45 cases.  I don't know if I have identified that it was  46 your question.  It was in my mind that it was.  47 Section 91(24) is an exception to the general rule 2479  Reply by Ms. Mandell  1 in the Constitution Act where jurisdiction over  2 property and civil rights generally was granted to the  3 Province.  The fundamental policy underlying the grant  4 of power to Canada in respect of Indians and their  5 land was to protect such lands from abuse at the hands  6 of the local governments.  7 And one of the exhibits at trial, and I have  8 included a portion of it in your material at tab 3, is  9 the Report of the Select Committee on Aborigines.  10 This was a committee that was discussing, among other  11 things, how the constitutions for the colonies should  12 treat the question of Indian and aboriginal  13 jurisdiction.  And the Select Committee said:  14  15 "The protection of the Aborigines should be  16 considered as a duty peculiarly belonging and  17 appropriate to the Executive Government, as  18 administered either in this country or by the  19 Governors of the respective Colonies.  This is  20 not a trust which could conveniently be  21 confided to the local Legislatures.  In  22 proportion as those bodies are qualified for  23 the right discharge of their proper functions,  24 they will be unfit for the performance of this  25 office.  For a local legislature, if properly  26 constituted, should partake largely in the  27 interests, and represent the feelings or the  28 settled opinion of the great mass of the people  29 for whom they act.  But the settlers in almost  30 every Colony, having either disputes to adjust  31 with the native tribes, or claims to urge  32 against them, the representative body is  33 virtually a party, and therefore ought not to  34 be the judge of such controversies."  35  36 So I say that there was a deliberate understanding  37 that if the Crown's obligations to protect Indian  38 people were to be confided to the Province or the  39 local legislatures, in so doing there was a conflict  40 of interest because the Province wants for its  41 citizens the very lands against which the Indian  42 people make their claims.  43 MACFARLANE, J.A.:  I have never had any doubt in my mind about  44 that point.  I think you must have misunderstood  45 something I said.  Anyway, if you are making the  4 6 argument --  47  MS. MANDELL:  Not only for you. 2480  Reply by Ms. Mandell  1 MACFARLANE, J.A.:  -- for me then you need not make it any  2 further.  But anyway, go ahead.  3 MS. MANDELL:  My lord, I actually want to make it in addition to  4 the point which I am leading up to, which I know you  5 haven't asked about, so I am going to continue.  6 Finally, the Select Committee, and I am reading  7 from the bolded portion of page 25.  8  9 "Whatever may be the legislative system of any  10 Colony, we therefore advise that, as far as  11 possible, the Aborigines be withdrawn from its  12 control."  13  14 And this rationale for federal control over Indian  15 affairs was recognized by Mr. Justice Idington in the  16 A.G. Ontario v. Canada case.  I will be coming to that  17 case for a different point in another minute.  Where  18 Mr. Justice Idington said:  19  20 "The case as it presents itself to my mind is  21 that the Dominion was assigned by the 'British  22 North America Act', section 91(24), the high,  23 honourable, and onerous duties of the guardians  24 of the many races of Indians then within or  25 that might at any future time fall within the  26 borders of Canada; that these duties were to be  27 discharged as occasion called for, having in  28 mind always the peace, order and good  29 government of Canada, and as part and parcel  30 thereof and not the least factor in promoting  31 all implied therein, the due observance of  32 those duties towards the Indians, which the  33 policy of the British Crown had rendered of  34 paramount importance; that the discharging, in  35 a statesmanlike way, with the several occasions  36 I have recited called for, these high duties of  37 national importance they were discharged all  38 the better by being freed from the trammels of  39 being confined within the narrow views that the  40 provincial range of vision might have  41 restricted action to, if the needs and wishes  42 of a single Province were to be considered, or  43 even the dominant factor used as a guide,  44 perhaps to the detriment of the national  45 interests."  46  47 Thus, we say, the federal Crown, by the terms of 2481  Reply by Ms. Mandell  1 Confederation, obtained no title or property to Indian  2 lands.  It was, however, empowered to accept a  3 surrender of aboriginal title and assumed the  4 corresponding fiduciary duties to deal with  5 surrendered lands in the interests of the Indians.  6 And I am going to take your lordships to some of  7 the passages from a long line of authority, from St.  8 Catherine's Milling to the present, which have either  9 held or assumed that the power to extinguish or accept  10 surrender of aboriginal title is a federal one.  11 And the first case I will refer your lordships to  12 is the Royalties case.  Mr. Justice Idington's remarks  13 come from it.  I should just advise your lordship that  14 the Royalties case involved a treaty which was entered  15 into between Canada and the Ojibeway people who were  16 then inhabiting lands which had been acquired by the  17 former Hudson's Bay Company.  18  19 "At the time the treaty was made the boundary  20 between Ontario and Manitoba had not been  21 defined.  When it was finally determined, in  22 1884, it was found that about 30,500 square  23 miles of the territory affected by it was in  24 Ontario and in 1903 the Dominion Government  25 brought before the Exchequer Court a claim to  26 be re-imbursed for a proportionate part of the  27 outlay incurred in extinguishing the Indian  28 title.  The Province disputed liability."  29  30 And so one of the issues which was before the Court  31 was whether or not the federal government had the  32 power to extinguish.  And thereafter the question  33 which was before the Court was whether or not in spite  34 of that there was any obligation owed by the Province  35 to reimburse.  And the majority judgment said that the  36 federal government both had the power to extinguish  37 and the power to pay.  And the two dissenting  38 judgments, Girouard and Davies, held that the federal  39 government had the power to extinguish but the  40 Province had a right to be reimbursed.  So on this  41 central point as to who had the power of  42 extinguishment, there was a majority expressed in the  43 Court.  44 And I have set out for your lordships at page --  45 beginning at the bottom of page 90 and the top of --  46 I'm sorry, the page of page 25 and the top of page 26,  47 the very -- in my opinion, very sharp statements by 2482  Reply by Ms. Mandell  1 both the majority, which is:  it is, I think, true, as  2 Mr. Newcombe argues, that the Dominion alone was  3 competent to authorize the treaty in question.  And by  4 Mr. Justice Davies, whose speaking with the dissent,  5 and we say therefore this view enjoyed the majority  6 support.  He said:  7  8 "...the Dominion and the Dominion alone could  9 act so as to extinguish the Indian title to any  10 lands within the Dominion."  11  12 And then on appeal it was a short judgment which  13 re-affirmed the Supreme Court of Canada's decision.  I  14 have set out the passage from the Privy Council where  15 they affirm in these words:  16  17 "The Dominion Government were, indeed, on  18 behalf of the Crown, guardians of the Indian  19 interest and empowered to take a surrender of  20 it and to give equvalents in return, but in so  21 doing they were not under any special duty to  22 the Province.  And in regard to the proprietary  23 rights in the land (apart from the Indian  24 interest) which through the Crown enured to the  25 benefit of the Province, the Dominion  26 Government had no share in it at all."  27  28 And we say that this decision has never been  29 overruled, and we are submitting it is binding.  30 Now, the same issue has come up in other contexts.  31 One is in the Batisse case, which I am only going to  32 lead your lordships to the passage which I have  33 quoted.  In Batisse, this is a hunting case out of  34 Ontario.  And the federal government in 1891 passed an  35 Act which basically invited or compelled, depending  36 upon your interpretation of the Act, the Ontario  37 government to become part of the treaty process or to  38 concur in the treaty.  And the Province did that.  And  39 this arose as a hunting case.  And the Province argued  40 that because it had been a party to the treaty that --  41 and when the Indian people agreed that their rights  42 would be subject to regulation, that section 88  43 doesn't apply to protect them because there was, in a  44 sense, a concurrence with the Province that provincial  45 regulatory laws would affect the treaty rights.  And  46 the court rejected this argument.  47 And I have set out the paragraph at page 26 for -- 2483  Reply by Ms. Mandell  1 in the Batisse case where Mr. Justice Bernstein said:  2  3 "In my view, the Province has no constitutional  4 right to negotiate an Indian treaty as an  5 independent party.  Its sole view -- it's sole  6 right, in view of the legislation, was to  7 concur a treaty entered into between the  8 Indians and the federal Government.  Although  9 the Province could perhaps veto a treaty by  10 refusing to concur (with decision setting out  11 the size and locations of reserves), the  12 legislation did not purport to give it any more  13 extensive powers over this area of exclusive  14 federal jurisdiction."  15  16 And, my lord, if you could just stroke the last  17 sentence of page 26.  It is just a word processing  18 error.  Paragraph 95, just stroke it.  19 My Lords, the last two cases I would like to take  20 you to, they are found at tab 4 of your materials.  21 One is Smith and the other is CP v. Paul.  And you'll  22 find the extract from the Smith case the second to the  23 last extract from the end of the tab.  And the page is  24 marked page 5 inside the tab.  The bottom right-hand  25 corner you should find page 5.  And you will come to  26 an extract of the Smith case.  27 LAMBERT, J.A.:  What tab?  28 MS. MANDELL:  This is tab 4.  My lord, this comes at the  29 provincial power to extinguishment through a somewhat  30 different route.  In the the Smith case the respondent  31 was invoking provisions of provincial legislation with  32 respect to limitations on action for the recovery of  33 land.  And one of the provincial prescription statutes  34 had the following clause.  And it is set out at page  35 398 under "Application of Provincial Statute of  36 Limitations".  It says:  37  38 "No claim for lands or rent shall be made, or  39 action brought by Her Majesty, after a  40 continuous adverse possession of sixty years."  41  42 And if your lordships will turn the page to 399, the  43 issue of Smith on this point was set out.  44  45 "The respondent claims that he has title to the  46 land by virtue of a continuous adverse  47 possession of at least sixty years by himself 2484  Reply by Ms. Mandell  1 and his predecessors in title.  What this  2 amounts to is a claim that the title to the  3 land of the Crown in right of the Province was  4 extinguished by adverse possession, and with it  5 the Indian title and the right to possession of  6 the Crown in right of Canada, which are based  7 on the status of the Land as reserve land or  8 surrendered land under federal jurisdiction.  9 If the title of the Crown was extinguished then  10 the Land ceased by definition to be reserve  11 land or 'Indians lands' or 'surrendered lands'  12 subject to the Indian act.  The issue, then, is  13 whether this could validly take place by  14 operation of provincial statute of  15 limitations."  16  17 And your lordships will see a very comprehensive  18 definition or discussion of federal provincial  19 paramountcy.  20 And if your lordships could turn to page 405, at  21 the bottom of the page the last paragraph, the court  22 concludes on this issue:  23  24 "What is really involved is the existence of  25 land as part of a reserve or surrendered lands  26 within the meaning of the Indian Act.  If  27 provincial law respecting the limitation of  28 actions could apply so as to have the effect of  29 extinguishing the Indian title or right of the  30 federal Crown to recover possession of land for  31 the protection of Indian interest, it could  32 have a dismembering effect analagous to that  33 which was held in Campbell-Bennett case to be  34 beyond provincial legislative competence.  It  35 would have the effect of destroying or  36 eliminating a part of the very subject-matter  37 of federal jurisdiction.  If provincial  38 legislation of general application cannot  39 constitutionally apply to restrict the use of  40 land reserved for the Indians within the  41 meaning of section 91(24) of the BNA Act, as  42 was held in the Peace Arch case (a conclusion  43 that appears to have been impliedly approved by  44 the Supreme Court of Canada in the Cardinal  45 case), then a fortiori must this be true of  46 legislation that would have the effect of  47 extinguishing the right to possession of such 2485  Reply by Ms. Mandell  1 land."  2  3 And just before leaving this case I want to advise  4 your lordships that the Peace Arch case, which was  5 relied upon here, was a case out of our B.C. Court of  6 Appeal.  And there the land in issue was not Indian  7 Act land, it was lands under 91(24).  It wasn't, in  8 Peace Arch, a case where we were dealing with lands  9 which had been set aside for the use and benefit of  10 the Indians under the Indian Act.  And so I say that  11 what the court in Smith is doing is saying that  12 provincial proscriptive legislation which has the  13 effect of extinguishing the right to possession is  14 beyond the power of the Province.  15 And if your lordships will just turn the divide  16 sheet to what I have marked as page 6, you will see  17 that this is the case of CP v. Paul in the Supreme  18 Court of Canada.  And the Court adopted the passage  19 from Smith that I have read to you.  20  21 "In light of our conclusion that CP derives its  22 interest in the eastern crossing through the  23 Woodstock Railway Company, it is clear that CP  24 cannot have acquired title by prescription or  25 adverse possession.  There are, in fact,  26 several reasons why CP cannot have acquired  27 title this way.  First, as La Forest J.A.  28 noted, it would be inconsistent to hold that  29 possession through the Crown could be claimed  30 in order to divest the Indians of an interest  31 in land which the Crown holds for their  32 benefit.  Further, we have noted above that s.  33 24 of the 1864 incorporating statute granted  34 permission to the railway company to enter and  35 take possession of the land.  Because this  36 permission has never been revoked, the company  37 had a legal right to be on the land and the  38 time period for adverse possession never began  3 9 to run."  40  41 And this is the sentence I rely upon:  42  43 "Finally, it seems that as a constitutional  44 matter provincial prescription legislation  45 would not apply to Indians."  46  47 And the case of Smith at the trial court, the one that 2486  Reply by Ms. Mandell  1 I have read to you, was cited.  And the Court notes  2 that it was overturned on other grounds.  3 And so, my lord, I say that the manner in which  4 the constitutional divisions of power protected  5 aboriginal rights can be summarized in this way, we  6 say that the Province had Crown title which was a  7 burden where aboriginal rights and title were a burden  8 on it, but the Province did not have the power itself  9 to extinguish that title.  That power rested with the  10 federal government as part of the overall role  11 assigned to the government to protect the well-being  12 of the Indian people in the course of the  13 colonialization process.  14 And I say at paragraph 98, page 28 of my speaking  15 notes, the 1837 Select Committee Report identified the  16 danger of a local legislature being called upon to  17 resolve a dispute concerning Indian lands to which it  18 was a virtual party.  This danger was clearly not  19 overlooked by the drafters of the Constitution Act who  20 allocated Crown interests in land to the Provinces,  21 made those interests subject to the Indian interest by  22 section 109 and, finally, by section 91(24), delegated  23 to Canada and withheld from the Province the power to  24 extinguish aboriginal title.  25 And I make reference to the statement of Mr.  26 Justice Strong in the St. Catherine's Milling case.  27 In the first paragraph which I have repeated on page  28 28, he is stating that:  29  30 "...lands in the possession of Indians are,  31 until surrendered, treated as their rightful  32 though inalienable property..."  33  34 And if I could ask your lordships to turn over the  35 page to the passage that I bolded, he says:  36  37 "I maintain that if there had been an entire  38 absence of any written legislative act  39 ordaining this rule as an express positive law,  40 we ought, just as the United States courts have  41 done, to hold that it nevertheless existed as a  42 rule of the unwritten common law, which the  43 courts were bound to enforce as such, and  44 consequently, that the 24th sub-section of  45 section 92, as well as the 10th section and the  46 5th sub-section of section 92 of the British  47 North America Act, must all be read and 2487  Reply by Ms. Mandell  1 construed upon the assumption that these  2 territorial rights of the Indians were strictly  3 legal rights which had to be taken into account  4 and dealt with in that distribution of property  5 and proprietary rights made upon confederation  6 between the federal and provincial  7 governments."  8  9 It will be developed later in argument by Mr.  10 Paterson that to construe the Constitution Act, 1867  11 as permitting provincial extinguishment of aboriginal  12 title, either directly or indirectly, is to infer a  13 power not expressly granted, and apparently negatived  14 by section 91(24), which power would be contrary to  15 prevailing Imperial policy over the previous century.  16 Such a construction is subversive of the entire scheme  17 of powers in relation to Crown lands and Indian lands.  18 And I make reference to one of the Amicus points  19 raised in his factum.  They say:  20  21 "The Parliament of Canada, in the absence of an  22 emergency or an act of war, was to have very  23 limited powers over property.  Apart from  24 property which was specifically allocated to  25 the Dominion all of the land and natural  26 resources of Canada came within provincial  27 legislative power to be administerd by the  28 Crown in right of the Province."  29  30 And at page 14 the Amicus submits "The federal heads  31 of power under section 91 are primarily regulatory and  32 non-proprietary".  33 And with respect, we say both of these submissions  34 confuse property rights with legislative jurisdiction.  35 All of the heads of 91 and 92 concern legislative and  36 regulatory powers.  None of them concern proprietary  37 interests.  38 In the Fisheries case, Lord Herschell said:  39  40 "There is no presumption that because  41 legislative jurisdiction was vested in the  42 Dominion Parliament proprietary rights were  43 transferred to it."  44  45 We say the reverse is true.  There is no  46 presumption that because title to lands was  47 transferred to the Province, jurisdiction over those 2488  Reply by Ms. Mandell  1 lands immediately followed.  To the contrary, at the  2 time of Confederation vast parts (perhaps the largest  3 part) of the territories of Ontario and Quebec were  4 subject to unextinguished rights protected by the  5 Royal Proclamation.  These lands were "lands reserved  6 for Indians" within the 91(24) and the Province would  7 obtain the benefit of these lands "as a source of  8 revenue once whenever the estate of the Crown is  9 disencumbered of the Indian title."  Speaking of those  10 lands, Lord Watson said:  11  12 "It appears to be the plain policy of the BNA  13 Act that, in order to ensure uniformity of the  14 administration, all such lands, and Indian  15 affairs generally, shall be under the  16 legislative control of one central authority."  17  18 It is beyond doubt that neither the grant of property  19 in section 109 nor the broad grants of jurisdiction in  20 section 92 of the Constitutional Act sufficed to grant  21 the provinces legislative jurisdiction over huge  22 portions of their territory prior to entry into  23 treaties with the Indian peoples and the resulting  24 surrender of the Aboriginal title to some of those  25 lands.  Section 91(24) represented, prior to such  26 surrender, a vastly greater degree of power in  27 Parliament over the lands in the province than the  28 submission of the Amicus would suggest.  29 It is entirely consistent with this constitutional  30 fact to say that the scope of Confederation  31 contemplated that the power to administer and derive  32 the benefits of Indian lands in British Columbia was  33 to pass to the province out of the resolution of  34 Indian lands rights in a treaty process such as was  35 underway at the time in Ontario.  36 And, my lord, if I could just say that about the  37 Terms of Union argument, we say that there is no merit  38 to the view advanced by the Amicus that the Canadian  39 constitution incorporates, through the Terms of Union,  40 a kind of British Columbia exceptionalism - a view  41 that Indian peoples and aboriginal rights were denied  42 the protection in this Province that they were  43 accorded elsewhere.  44 And I am not going to address your lordships  45 orally.  The argument was developed and is set out in  46 our reply factum, and I have led you to those  47 paragraphs.  And I think that at this point I am going 2489  Reply by Ms. Mandell  1 to move into a new area.  2 LAMBERT, J.A.:  Before the break, I would like to raise a  3 question.  There has been an argument that the  4 legislation that authorizes the issuance of fee simple  5 titles, or the granting of a fee simple title, or an  6 action by the owner of a fee simple title, or all  7 three together, can have the effect of extinguishing  8 aboriginal title.  You have different arguments in  9 relation to the colonial period than you do in the  10 period post-1871.  11 Some of those three things that I have discussed  12 may occur in one period and some in another.  I would  13 like to be sure that I understand the position of each  14 of the parties.  I know that your basic position is  15 that there cannot be a grant of fee simple title or  16 effective legislation extinguishing aboriginal title.  17 But if that basic position were not to stand up in its  18 entirety so that at least perhaps in the colonial  19 period, for example, it could be said that setting a  20 process in train or the granting of a fee simple title  21 is inconsistent, entirely inconsistent with the  22 aboriginal title to that area, then how does it work  23 its way through afterwards if the actual title is not  24 issued until after 1871, for example, or if the acts  25 that are inconsistent with the aboriginal title occur  26 after 1871?  I just would like to be sure that I know  27 each of the parties' positions before we finish.  28 MS. MANDELL:  Thank you, my lord.  29 TAGGART, J.A.:  All right.  We will take the morning break.  30 THE REGISTRAR:  Order in court.  Court stands adjourned.  31 (MORNING RECESS)  32  33 I hereby certify the foregoing to  34 be a true and accurate transcript  35 of the proceedings transcribed to  36 the best of my skill and ability.  37  38  39  40  41  42 Lisa Reid,  43 Official Reporter,  44 UNITED REPORTING SERVICE LTD.  45  46  47 2490  Reply by Ms. Mandell  1 (MORNING RECESS)  2  3 THE REGISTRAR:  Order in court.  4 TAGGART, J.A.:   Yes.  5 MS. MANDELL:  Thank you, my lords.  Mr. Justice Hutcheon, you  6 asked what the Trial Judge said about Douglas' powers.  7 It's at page 246 of the Western --  8 TAGGART, J.A.:  Where can I make a note of this?  9 HUTCHEON, J.A.:  Paragraph 41.  You said —  10 MS. MANDELL:  It's at page 246 of his judgment in the Western  11 Weeklys and, my lord, if I could just read it to you.  12  13 "Mr. Rush offered an interesting argument based not  14 on the governor's instructions but, rather, upon  15 his commission which precluded him from making any  16 law of an extraordinary nature an importance  17 whereby our prerogative or the right of the  18 property of our subjects residing in our said  19 Colony may be prejudiced.  He argues from this  20 that the governor had no power to make any laws  21 which would extinguish aboriginal interests of the  22 Indians who were subjects of the Crown.  This  23 argument presupposes aboriginal interests are not  24 subject to extinguishment, whereas it seems  25 incontestable that they were extinguishable at the  26 option of the Crown.  The contrary has never been  27 suggested in any of the Canadian authorities, such  28 as St. Catherine's Milling, Calder, and Sparrow.  29 In any event, as will be shown, most of the  30 colonial legislation was also enacted by the  31 Imperial Parliament."  32  33 So he never actually does engage the argument  34 which Mr. Rush and later myself addressed your  35 lordships to as to the limitations on Douglas' power.  36 My lords, I am speaking now at page 31, and I'd  37 like to address your lordship -- I hope, Mr. Justice  38 Lambert, in the course of this I will have answered  39 your question as well on the question of the clear and  40 plain test and blanket extinguishment and adverse  41 possession.  And I am at the bottom of page 31,  42 paragraph 109.  43 The Amicus proposes that the clear and plain test  44 can be discharged if the Colony enacts land laws, not  45 aimed at extinguishment but which, together, evidence  46 a unit of intention to exercise dominion adverse to  47 aboriginal rights. 2491  Reply by Ms. Mandell  1 The Respondents and Amicus propose that the clear  2 and plain test can be discharged by mere  3 administrative acts, when a third party is granted an  4 interest in land which is adverse to the aboriginal  5 rights.  The grant which accomplishes extinguishment  6 is made pursuant to provincial laws of general  7 application, laws which are not aimed at the  8 extinguishment.  9 The Appellants have submitted to this Court that  10 extinguishment may not be implied under the Sparrow  11 test.  Neither the Respondents nor the Amicus suggest  12 that the Province can enact or has enacted legislation  13 expressly extinguishing aboriginal rights or title.  14 To this the Appellants reply that neither has alleged  15 an act capable of extinguishing aboriginal rights and  16 that the absence of express legislation is a complete  17 answer to their positions.  18 Now, both the Respondents and the Amicus argue  19 that the clear and plain test pronounced in Sparrow  20 does not require express legislation.  They tease  21 words and phrases from cases to loosen the strong  22 language in Sparrow that the sovereign intention to  23 extinguish must be clear and plain.  They say they can  24 demonstrate that the clear and plain test can be  25 construed by implication.  And we say that the cases  26 which they draw in aid of this exercise do not bear  27 the weight of the interpretation which they place on  2 8 it.  And I have drawn your lordships to our factum  29 where we have gone through seriatim the various cases  30 which they rely on to try and tease out the question  31 of implication from the Sparrow test.  And I refer by  32 way here only to two, and that is in Lipan Apache, the  33 Amicus relied upon this case to argue that Mr. Justice  34 Hall's statement in Calder that extinguishment can  35 only take place by specific legislation is not  36 supported by the authorities on which his lordship  37 relied and further that there is no requirement that  38 the intention of the Crown may only be derived from  39 legislation.  They placed great stress on the six  40 bolded words cited in the passage below, and I won't  41 take you through the Santa Fe quote, but at the bottom  42 they say:  43  44 "While the selection of a means is a governmental  45 prerogative, the actual act..."  46  47 And then they stress: 2492  Reply by Ms. Mandell  1  2 "... (or acts) of extinguishment must be plain and  3 unambiguous.  In the absence of a 'clear and plain  4 indication'..."  5  6 And they lay great stress on the words:  7  8 "...in the public records that the sovereign  9 'intended to extinguish all the (claimants')  10 rights' in their property, Indian title  11 continues."  12  13 Yet, I point out that the Court in Lipan Apache  14 held that extinguishment must be clear and plain and  15 in so doing, they rejected all arguments of implied  16 extinguishment.  17 The Respondents and the Amicus relied upon the  18 following passage in Simon in support of their implied  19 extinguishment test.  20  21 "Given the serious and far reaching consequences of  22 a finding that a treaty right has been  23 extinguished, it seems appropriate to demand  24 strict proof of the fact of extinguishment in each  25 case where the issue arises.  As Douglas J. said  26 in Santa Fe, extinguishment cannot be lightly  27 implied."  28  29 Now, going back to Santa Fe, Mr. Justice Douglas  30 pronounced these words in the context of rejecting an  31 implied extinguishment argument; namely, that in  32 creating the Colorado River reservation, Congress  33 intended to extinguish the rights of the Walapais.  In  34 so doing, the Court reaffirmed the trust relationship  35 between the Indians and the Federal Government, a  36 relationship which imposes a high standard of conduct  37 on the government if rights are to be extinguished.  38 And this is the passage of Santa Fe:  39  40 "But an extinguishment cannot be lightly implied in  41 view of the avowed solicitude of the Federal  42 Government for the welfare of its Indian wards.  43 As stated in Choate v. Trapp the rule of  44 construction recognized without exception for over  45 a century has been that 'doubtful expressions,  46 instead of being resolved in favour of the United  47 States, are to be resolved in favour of a weak and 2493  Reply by Ms. Mandell  1 defenceless people, who are wards of the nation,  2 dependent wholly upon its protection and good  3 faith."  4  5 Contrary to the Amicus' submission that Simon left  6 open the door to prove extinguishment by implication  7 as a matter of fact, in Sioui, the Supreme Court  8 settled the issue left open in Simon and pronounced  9 that treaties must be extinguished by consent.  And  10 this is a case that followed Simon and closed the door  11 on this argument.  12  13 "It must be remembered that a treaty is a solemn  14 agreement between the Crown and the Indians, an  15 agreement the nature of which is sacred:"  16  17 And they quote Simon and White and Bob.  18  19 "The very definition of a treaty thus makes it  20 impossible to avoid the conclusion that a treaty  21 cannot be extinguished without the consent of the  22 Indians concerned."  23  24 We say, the purpose for which the Respondents and  25 the Amicus seek to expand the clear and plain test to  26 include implied extinguishment is to breath life into  27 two arguments which they advance in this case and  28 which the Appellants submit have already been rejected  29 in Sparrow.  30 The first argument is that a series of statutes  31 evince a unity of intention to exercise a sovereignty  32 inconsistent with any conflicting interest.  The  33 Amicus candidly states in its factum that they are  34 seeking to reintroduce the test of Mr. Justice Judson  35 in Calder, a test which was adopted by the Trial  36 Judge.  And I have set out where in their factum they  37 pose that question.  So the first argument is, what we  38 say, the Judson argument.  39 The second argument, which the Respondents and  40 Amicus are seeking to reintroduce which we say has  41 been rejected is that aboriginal rights are  42 extinguished to the extent that they are inconsistent  43 with the statute.  The Respondents and Amicus seek to  44 test the adverse effect of Provincial regulatory  45 legislation of general application and grants issued  46 pursuant to Provincial legislation as effecting  47 extinguishment. 2494  Reply by Ms. Mandell  1 And for the purposes of this discussion, I leave  2 aside the question of fee simple grants which I will  3 deal with later.  The Appellants submit that the very  4 arguments (and therefore the implied test for  5 extinguishment) advanced by the Respondents and Amicus  6 have been rejected in Sparrow, and I have cited to  7 your lordships now a very oft-quoted passage:  8  9 "In the context of aboriginal rights, it could be  10 argued that, before 1982, an aboriginal right was  11 automatically extinguished to the extent that it  12 was inconsistent with the statute."  13  14 That's the same position which the Amicus and the  15 Respondents have now pointed to the -- to your  16 lordships to adopt.  17  18 "As Mr. Justice Mahoney stated in Baker Lake:  19  20 Once a statute has been validly enacted, it must  21 be given effect.  If its necessary effect is to  22 abridge or entirely abrogate a common law right,  23 then that is the effect that the courts must  24 give it.  That is as true of an aboriginal title  25 as of any other common law right."  26  27 And then they say:  28  29 "That in Judson J.'s  view was what had occurred in  30 Calder, where, as he saw it, a series of statutes  31 evinced a unity of intention to exercise a  32 sovereignty inconsistent with any conflicting  33 interest, including aboriginal title."  34  35 So that's the second argument that they advance  36 here in which we submit the Court in Sparrow expressly  37 rejected.  38 And I say, my lords, that the Sparrow court was  39 compelled to address the arguments which the Amicus  40 and the Respondents raise before this Court.  This  41 arose in the context of the Court's consideration of  42 the meaning of the word "existing".  Prior to 1982,  43 aboriginal rights were common law rights, vulnerable  44 to the doctrine of parliamentary supremacy.  The  45 aboriginal fishing right in issue had been regulated  46 for many years.  Having found that "existing" meant  47 "unextinguished", the Court was faced with the task of 2495  Reply by Ms. Mandell  1 determining whether the exercise of a right had merely  2 been impaired or whether the underlying right had  3 survived regulation and became an existing right  4 within the meaning of Section 35.  The Court first  5 determined whether the regulation of the right had  6 extinguished it.  It was in the context of this  7 argument that the Court addressed the theory of  8 adverse dominion, then advanced by the Federal  9 Government.  The theory was that because the right had  10 been regulated before 1982 it was inherently subject  11 to regulation.  Further, because the effect of the  12 regulations had been to deny the right for a hundred  13 years, the right was extinguished.  The Court in  14 Sparrow rejected these arguments and, we say, the test  15 which gave rise to them.  The Appellants ask this  16 Court to apply the test in Sparrow and reject these  17 arguments too.  18 In rejecting the theory of adverse dominion based  19 on the effect of regulation, the Court sought to draw  20 a bright line to identify the underlying right (ie.  21 the unextinguished right) from the mere impairment.  22 And that bright line was expressed in the passage  23 that your lordships know:  24  25 "But Hall, J. in that case stated that 'the onus of  26 proving that the Sovereign intended to extinguish  27 Indian title lies on the respondent and that  28 intention must be 'clear and plain'.  The test of  29 extinguishment to be adopted in our opinion, is  30 that the Sovereigns intention must be clear and  31 plain if it is to extinguish an aboriginal right."  32  33 The test which the Court advanced to determine  34 extinguishment is one which requires a careful  35 examination of sovereign intention to clearly and  36 plainly extinguish aboriginal rights as opposed to  37 regulating some other matter or regulating the right  38 itself, where such regulations may have the effect of  39 impairing the rights exercised.  The Appellants rely  40 on Sparrow.  41 Decisions on the test for extinguishment in the  42 U.S. have provided a less exacting standard that has  43 been set by our Court in Sparrow.  Yet, the American  44 cases would not find extinguishment based on the test  45 advanced by the Respondents and the Amicus.  46 The clear and plain test for extinguishment of  47 title from Santa Fe was considered in Dion, and there 2496  Reply by Ms. Mandell  1 the Court said, and I am just going to read the bolded  2 paragraph:  3  4 "What is essential is clear evidence that Congress  5 actually considered the conflict between its  6 intended action on the one hand and Indian treaty  7 rights on the other, and chose to resolve that  8 conflict by abrogating the treaty."  9  10 In that case the Court reviewed the legislative  11 history and determined that Congress directly  12 addressed itself to the question of extinguishment of  13 a treaty right and provided, in the statute, an  14 abridged means of exercising that right.  15 It is submitted that the test for adverse  16 dominion, if such a test has any application, can be  17 no less demanding.  That is, it must be shown that, in  18 the manner in which dominion was exercised, the  19 sovereign "actually considered" the aboriginal rights  20 alleged to have been infringed and determined to so  21 infringe them.  22 Failure to adopt such a standard would produce the  23 absurd result that the test for finding extinguishment  24 by administrative action would be less severe than  25 finding extinguishment by legislation.  And, my lords,  26 I rely upon paragraph 130 which I say is really at the  27 heart of why the adverse dominion test is proposed by  28 my friends is simply not a test which accords the  29 standard which Sparrow set for it.  30 We say this requirement, that is, that Congress  31 actually considered the conflict and addressed it, is  32 consistent with the intention test adopted in Sparrow.  33 The critical feature of Hall's test is not simply the  34 degree of proof required, which is clear and plain and  35 the onus is on the Crown, but on the very matter to be  36 proved.  The Sparrow Court rejected the objective test  37 of Judson which merely requires a finding that the  38 Crown intended to act in a manner and that such action  39 was inconsistent with continued title.  It accepted a  40 subjective test that the requisite intention be  41 specifically directed to the question of Indian title  42 and its extinguishment.  No less will suffice.  This  43 corresponds with the requirement of Dion that the  44 legislature direct its attention specifically to the  45 question of aboriginal rights and decide concretely to  46 extinguish them.  In the absence of such a directed  47 intent, extinguishment, I say, should not be inferred 2497  Reply by Ms. Mandell  1 by the Courts.  2 And I say that the adverse dominion test is really  3 not an extinguishment test.  4 The Respondents and Amicus submit that aboriginal  5 rights may be extinguished by the exercise of adverse  6 dominion adverse to the right of occupancy.  There  7 is -- authority is Santa Fe and they rely upon the  8 question -- I am sorry, the passage which I cited:  9  10 "And whether it (extinguishment) be done by treaty,  11 by the sword, by purchase, by the exercise of  12 complete dominion adverse to the right of  13 occupancy, or otherwise, its justness is not open  14 to inquiry in the Courts."  15  16 And I make several comments about the passage.  17 First, this passage is not directed to the question of  18 the means of extinguishing title, but to the question  19 of governmental power.  The Court is saying that the  20 United States has the power to extinguish and that if  21 that power is exercised the Court will not review it  22 on grounds of whether the power ought not to have been  23 exercised.  In this context the Court's comments are  24 unremarkable and mirrors the traditional stance of the  25 courts faced with intra vires exercise of governmental  26 power.  The means of extinguishment referred to in the  27 passage are not the focus of the comments.  28 And I say, secondly, in the issue of  29 extinguishment of title through state action was, in  30 any event, irrelevant to Santa Fe where the Court held  31 that the title was extinguished by consent.  And I  32 have already led your lordships to those passages in  33 my earlier submissions to you as part of our case.  34 And I say though, thirdly, it is important to note  35 that the standard required by Mr. Justice Douglas in  36 the Santa Fe decision is very high.  In this case,  37 Congress created a reserve for the Walapais who were  38 forcibly removed from their ancestral lands.  Of the  39 creation of the Reserve, Mr. Justice Douglas said:  40  41 "We find no indication that Congress by creating  42 that reservation intended to extinguish all of the  43 rights which the Walapais had in their ancestral  44 home.  That Congress could have effected such an  45 extinguishment is not doubted.  But an  46 extinguishment cannot be lightly implied."  47 2498  Reply by Ms. Mandell  1 And you have heard the rest.  2 And of the forced removal, the Court said:  3  4 "Their forcible removal in 1874 was not pursuant  5 to any mandate of Congress."  6  7 And I say that's quite important because what Mr.  8 Justice Douglas is saying is that you find the  9 intention to extinguish in an act of Congress.  10  11 "It was a high-handed endeavour to wrest from  12 these Indians lands which Congress had never  13 declared forfeited."  14  15 And we say, my lords, applying that test, that fee  16 simple grants do not extinguish aboriginal title, and,  17 Mr. Justice Lambert, we say this both in respect of  18 the pre-Confederation and the post-Confederation  19 period.  20 The Province, in applying the adverse dominion  21 test, argues without hesitation or authority, that all  22 grants in fee simple extinguish aboriginal rights.  23 It is clear that Mr. Justice Douglas in Santa Fe  24 did not consider this to be the force of this comment.  25 To the contrary, at page 268, he says that:  26  27 "...in the absence of such extinguishment the grant  28 to the railroad conveyed the fee subject to this  29 right of occupancy."  30  31 And he goes on to recall U.S. v. Mitchel, that such  32 right of occupancy is as sacred as the fee simple of  33 the whites.  34 The authority on which Mr. Justice Douglas relied  35 in his adverse dominion passage, Beecher v. Wetherby,  36 was cited as an authority in respect of the power of  37 the state to extinguish title, not in respect of the  38 means.  Beecher, in fact, concerns lands which were  39 surrendered by treaty and therefore the power of the  40 state to extinguish is not in issue.  Beecher concerns  41 the problem where certain lands were transferred by  42 the United States to Wisconsin upon the latter  43 becoming the state pursuant to a constitutional  44 arrangement between the governments.  The Court  45 considered that Wisconsin took the property:  46  47 "...subject, it is true, as in all other cases of 2499  Reply by Ms. Mandell  1 grants of public lands, to the existing occupancy  2 of the Indians so long as that occupancy should  3 continue."  4  5 And shortly after the admission of Wisconsin, the  6 Indians ceded their land by treaty.  7 In this respect, we say, the judgment follows the  8 same approach as St. Catherine's that the provinces  9 acquired title to Crown lands subject to the burden of  10 aboriginal title.  11 What is clear in both Santa Fe and Beecher is that  12 fee simple grants of title do not extinguish, but  13 remain subject to the aboriginal interest.  They do  14 not support an inference of intention to extinguish.  15 This line of reasoning has been followed in the  16 United States.  The Beecher Court tackled this  17 question directly and, after noting that the Indian  18 right was one of occupancy, stated:  19  20 "The fee was in the United States, subject to that  21 right, and could be transferred by them whenever  22 they chose.  The grantee, it is true, could take  23 only the naked fee, and could not disturb the  24 occupancy of the Indians; that occupancy could  25 only be interfered with or determined by the  26 United States."  27  28 Beecher, a judgment of Mr. Justice Field, was  29 followed by a decision by that same jurist in Buttz,  30 which case was also relied upon in Santa Fe.  In that  31 case, the Court again considered the result of a fee  32 simple grant of title on unextinguished aboriginal  33 title and said:  34  35 "At the time the Act of July 2 was passed, the  36 title of the Indian Tribes was not extinguished.  37 But that fact did not prevent the grant of  38 Congress from operating to pass the fee of the  39 land to the Company.  The fee was in the United  40 States.  The Indians had merely a right of  41 occupancy, a right to use the land subject to the  42 dominion and control of the government.  The grant  43 conveyed the fee subject to this right of  44 occupancy.  The Railroad Company took the property  45 with this incumbrance."  46  47 The Court noted that subsequent to the grant, the 2500  Reply by Ms. Mandell  1 government negotiated the consent of the Indians for  2 the right to construct railroads, wagon roads and  3 telegraph lines and so on.  4 The American position appears to be based on the  5 notion that it is possible for the state to grant a  6 fee simple subject to pre-existing encumbrances.  The  7 land becomes freed of those encumbrances only when a  8 positive act of surrender or extinguishment is shown.  9 And this has been from the beginning in Johnson v.  10 M'Intosh, Chief Justice Marshall said:  11  12 "While the different nations of Europe respected  13 the right of the natives, as occupants, they  14 asserted the ultimate dominion in themselves; and  15 claimed and exercised as a consequence of this  16 ultimate dominion, a power to grant the soil,  17 while yet in the possession of the natives.  These  18 grants have been understood by all to convey a  19 title to the grantees, subject only to the Indian  20 right of occupancy."  21  22 Now, your lordships will recall in the Calder case  23 submissions were made to the Court and were recorded  24 by Mr. Justice Hall that a grant of fee simple in  25 respect of lands the aboriginal title to which is  26 unextinguished, is ultra vires.  27 The Appellants submit that this extreme  28 construction is unnecessary only when the Court  29 concludes that the grant of title must be construed as  30 a grant of an unencumbered interest, then the grant  31 must fail because of the encumbrance.  Where the Court  32 construes the grant has encumbered, the grant will be  33 valid subject to the encumbrance.  And then we would  34 rely upon Santa Fe and the related cases.  The  35 Appellants submit that, in either case, the courts  36 cannot find a grant of title, standing alone, to have  37 extinguished aboriginal title.  38 We say that extinguishment must be intra vires.  39 The Appellants' position is that the Province is not  40 constitutionally competent to affect extinguishment.  41 It follows that Provincial acts cannot be construed so  42 as to extinguish title.  And I rely upon the Oneida  43 case where this issue was an issue.  The case there --  44 the Court said where title is alleged to have been  45 extinguished through an act of a state government by  46 means of a treaty with the Indians, such  47 extinguishment is not valid, as only the United States 2501  Reply by Ms. Mandell  1 has the power to extinguish aboriginal title.  Federal  2 reference to such an invalid treaty in subsequent  3 federal treaties does not demonstrate "a plain and  4 unambiguous intent to extinguish Indian title and will  5 not be considered a ratification of the treaty".  So  6 our --  7 LAMBERT, J.A.:  Do I understand at this point that you consider  8 you have answered the question that I asked?  9 MS. MANDELL:  Not quite.  I think I am going to come back to  10 your lordship because I know that your question  11 actually also asked if the -- if there was a power to  12 issue a grant of fee simple in the Colony, because  13 there was no division of power problem then, what do  14 we say follows as a result of grants which may have  15 been issued or not exercised but subsequently  16 exercised within that period.  And our answer to that  17 is that the grant in any event, whether it be  18 exercised -- whether it be made before or after  19 Confederation, in either event is subject to the  20 encumbrance, it's subject to aboriginal title.  And we  21 say that after Confederation your lordships are -- in  22 our submission, you're barred by the division of  23 powers problem to find that the grant extinguished  24 before Confederation, we say that the grant itself  25 couldn't extinguish.  This is as a result of the cases  26 that I have asked your lordships to deal with, Buttz  27 and Johnson and M'Intosh and Santa Fe, we say that the  28 grant of itself couldn't extinguish, simply that the  29 grantee took subject to the encumbrance.  30 LAMBERT, J.A.:  I'd like to be a little more pointed.  There are  31 areas, such as the city of Vancouver, where there no  32 doubt were aboriginal rights before 1846 or earlier,  33 and yet, it's very hard to accept the view that you  34 are putting forward that all the titles in the city of  35 Vancouver are subject to the burden of the aboriginal  36 title.  37 MS. MANDELL:  Yes.  38 LAMBERT, J.A.:  And you would assert a right of compensation to  39 this if they're to be deprived of that.  If you were  40 to trace -- let's suppose that you accept that there  41 has been an extinguishment in Vancouver, that's  42 contrary to your argument, I understand.  43 MS. MANDELL:  That's right.  44 LAMBERT, J.A.:  But if you accept that, then it's been by the  45 process set out in this argument that the Province has  46 advanced a series of steps by which the fee simple,  47 the allodial title went into the Crown on the 2502  Reply by Ms. Mandell  1 assertion of sovereignty; the fee simple title went  2 into the Crown when you -- with the instrument that  3 you want us to call Colonial Instrument two, and then  4 a fee simple grant at some point was made to a third  5 party, not the Crown.  It seems to me that that didn't  6 require any legislation at that point, and then people  7 actually built up on the granted land and that didn't  8 require any legislation.  So even if they -- since  9 1871, it's been beyond the Province's power to pass  10 the legislation, nonetheless, the Colonial Instrument  11 two may have been the only legislative act that was  12 required for extinguishment if you accept the  13 Province's view that adverse dominion absolutely  14 apparent operates as an extinguishment.  So I wondered  15 whether there was any submission that you would like  16 to make on behalf of the Appellants that the force of  17 Calder two became spent at sometime or other,  18 something more was needed other than --  19 MS. MANDELL:  I see what you are asking.  20 LAMBERT, J.A.:  — just that initial legislative act that  21 started off the process that got adverse dominion, and  22 it requires, I think, thinking through the stages that  23 what they were to take place and how they operate  24 together to make a composite intention and how much of  25 that composite intention was clear and plain in  26 Colonial Instrument two.  27 MS. MANDELL:  All right.  I understand your question.  My lords,  28 I think I am going to take the lunch break and respond  29 to you after lunch.  I understand better now what you  30 are asking.  31 LAMBERT, J.A.:  Very well.  32 MS. MANDELL:  My lords —  33 TAGGART, J.A.:  Along with that, you began this reply or early  34 on in the reply, as I understood you, you suggested  35 that when the European powers came to Canada are  36 limited to present day Canada, when they came to  37 Canada, there existed throughout that geographic area  38 an aboriginal title or interest in land.  39 MS. MANDELL:  Yes, that's right.  40 TAGGART, J.A.:  Every square inch of that geographic area was  41 subject to the aboriginal title --  42 MS. MANDELL:  Right.  43 TAGGART, J.A.:  -- by one nation of aboriginal people or  44 another.  Am I correct that that's a fundamental --  45 MS. MANDELL:  Well, it's certainly — it's certainly logical  46 that that would be the case.  I don't know of any part  47 of British Columbia where one nation or another hasn't 2503  Reply by Ms. Mandell  1 claimed it or --  2 TAGGART, J.A.:  Yes.  I was going to now come to British  3 Columbia and --  4 MS. MANDELL:  It's a question of fact.  5 TAGGART, J.A.:  -- that applies to the entire geographic area of  6 present day British Columbia.  7 MS. MANDELL:  I think that's a fair premise that that's the  8 case.  I don't know that.  I mean, I don't know that  9 as a matter of fact, whether each of the first  10 nations' boundaries were so totally contiguous that  11 there would be a complete blanketing of the aboriginal  12 interest, but I certainly don't know that it wasn't.  13 It would appear logical that it would be.  14 TAGGART, J.A.:  So that it's in that context that one must  15 approach the argument that you are now making on the  16 issue of extinguishment.  17 MS. MANDELL:  That's right.  18 TAGGART, J.A.:  And the questions that my Brother Lambert has  19 posed.  20 MS. MANDELL:  Yes.  All right.  Thank you, my lords.  21 My lords, for the balance of the morning I'd like  22 to talk about the fiduciary relationship in this test  23 of adverse dominion, and I am at paragraph 151.  24 It is submitted that adverse dominion is an  25 unprincipled violation of fiduciary principles.  By  26 its application, aboriginal title can be extinguished  27 without notice, without consent and, the Province  28 argues, without compensation.  Extinguishment is said  29 to occur when the Provincial Crown, which has no power  30 directly to extinguish title, through its agents,  31 servants, and employees unilaterally gives to third  32 parties permission to Indian people from -- permission  33 to preclude Indian people from exercising rights over  34 their territory.  The legislature need never be  35 directly responsible for the extinguishment of title,  36 and it need never clearly and plainly address it.  37 Third parties carry out the Crown's implied purpose.  38 In advancing the test, Canada, the Province and Amicus  39 embrace the Province's, we say, illegal acts and  40 Canada's failure to protect the Indian people from  41 those acts, and argues that such conduct should be  42 sanctioned from the Court.  43 And Canada place and the Province place heavy  44 reliance on Sioui.  We say the Sioui case doesn't  45 assist them.  46 The case involved the interpretation of a treaty  47 right, based upon an investigation of the intention of 2504  Reply by Ms. Mandell  1 the parties at the time of treaty.  The ratio of the  2 case is a finding that the common intention of the  3 parties in concluding the treaty was to reconcile the  4 Huron's need to protect the exercise of their customs  5 and the desire of the British conquerors to expand.  6 That was found to be a term of the treaty, and  7 everything which is said thereafter about  8 reconciliation is interpreting the treaty term.  The  9 Court found that the Hurons agreed to a treaty  10 protecting certain rights "to the extent that those  11 customs did not interfere with the enjoyment of lands  12 by the occupier".  It is on the basis of the finding  13 by the Court of this implied term of the treaty that  14 the test of incompatibility arises.  It is not a  15 general test pronounced to deal with extinguishment of  16 aboriginal rights.  17 We say that Sioui stands against other  18 propositions advanced by the Province and the Amicus.  19 Rather than being extinguished by legislation and  20 administrative acts, the Court held that the treaty  21 right can survive legislated changes to the use of  22 land.  23  24 "A legislated change in the use of the territory  25 thus does not extinguish rights otherwise  26 protected by a treaty...  If the treaty gives the  27 Hurons the right to carry on their customs and  28 religion in the territory of Jacques-Cartier Park,  29 the existence of a provincial statute and  30 subordinate legislation will not ordinarily affect  31 that right."  32  33 If a treaty right which, by express terms depends  34 on a compatibility with Crown use, can survive  35 legislated changes to the land, surely an aboriginal  36 right with no such limitation can also survive.  37 Amicus argues in respect of the Colonial  38 Instruments, no scope, they say, for the exercise of  39 any aboriginal right to land outside the reserve could  40 survive such legislation.  The Court in Sioui (in  41 relation to the treaty right) held that the Crown must  42 prove that the rights cannot be accommodated.  43  44 "...it is up to the Crown to prove that its  45 occupancy of the territory cannot be accommodated  46 to the reasonable exercise of the Hurons' rights."  47 2505  Reply by Ms. Mandell  1 And, again, we say no lesser standard should apply to  2 the proof of incompatibility between aboriginal rights  3 and the legislation.  4 Mr. Plant for the Amicus argued that CP v. Paul  5 established, and he put it a bit bluntly, that in a  6 contest between a statutory easement and aboriginal  7 title, aboriginal title must lose.  And we say that  8 the Court -- this decision has been called into  9 question by the Supreme Court of Canada, and I note,  10 your lordship, the passage which you have heard many  11 times, but this is when, in Sparrow, the Courts were  12 calling that the policy towards the Indians was the  13 Royal Proclamation, and so on.  They say at the bolded  14 passage:  15  16 "And there can be no doubt that over the years the  17 rights of the Indians were often honoured in the  18 breach."  19  20 And they cited CP v. Paul, and then our Court, Mr.  21 Justice MacDonald in Pasco:  22  23 "We cannot recount with much pride the treatment  24 accorded to the native people of this country."  25  26 We say, a difficult question is posed by the action.  27 The Appellants seek rectification of past wrongs  28 towards them and the articulation of principles which  29 will provide for a just accommodation between them and  30 the non-Indian population.  This Court ought not to  31 seek a solution to these difficult questions by  32 recourse to a decision, the justice of which has been  33 explicitly called into question.  34 My lords, I'd ask you to turn to tab 6 of your  35 book.  You will find there a photograph.  36 TAGGART, J.A.:  Of the reference book?  37 MS. MANDELL:  This is of your reference book.  My lords, this  38 is -- there are actually three photographs strung  39 together but it's really a picture of a cabin which  40 was built and used by the High Chief -- Gitksan Chief,  41 Pete Muldoe, whose hereditary Chief's name is  42 Gitludahl, and you will see, my lords, I have marked  43 with a sticky where the cabin is to be found in the  44 territory.  The cabin was originally built in a wooded  45 area and that's found in his transcript reference  46 which I am not taking you to it, it's behind the flat.  47 The cabin was built in a wooden area and had been used 2506  Reply by Ms. Mandell  1 by Mr. Muldoe and his family as his winter home where  2 they trapped and hunted in their house territory.  The  3 picture you see is the site which faced Mr. Muldoe  4 when he came back to his land after the area had been  5 clear-cut.  6 And we say that the theory of adverse dominion  7 produces this result.  Former holders of the name  8 Gitludahl have cared for this territory from  9 generation to generation.  Under Gitksan law, the  10 territory is harvested but in a way which ensures that  11 the next generation will have the same resource base  12 as the present generation and the generation who  13 preceded them.  By maintaining this balance - taking  14 what is needed, but, at the same time, protecting the  15 lands for generations to come, all the Appellants'  16 territories were rich in resources when the Crown  17 asserted sovereignty.  Mr. Lowe's clients have  18 harvested that wealth and taken it away.  Not only  19 have the resources not been for the benefit of this  20 generation whose inheritance it is, but the  21 Respondents and the Amicus argue that because the  22 logging company has exercised rights derived from the  23 Crown adverse to Mr. Muldoe's aboriginal rights, his  24 aboriginal rights have now been extinguished.  25 According to their theory of extinguishment not only  26 will it be impossible for Mr. Muldoe to use the land  27 for the benefit of himself and his House, but because  28 he has been dispossessed, that fact alone results in  29 his children being dispossessed.  30 Under Canada's proposed extinguishment test, some  31 inquiry would have to determine whether the exercise  32 of this grant by the logging company was totally  33 inconsistent with Mr. Muldoe's rights.  This would be  34 a factual inquiry and, based on the photograph, it  35 appears that few rights are exercisable in respect of  36 this land.  Mr. Justice Seaton was correct when he  37 said in Meares Island:  38  39 "The proposal is to clear-cut the area.  Almost  40 nothing will be left.  I cannot think of any  41 native right that could be exercised on lands that  42 have been recently logged."  43  44 The Amicus supports the decision of the Trial  45 Judge that, if Mr. Muldoe's — that Mr. Muldoe's  46 rights were extinguished before Confederation but that  47 Mr. Muldoe is free to use this land until it is needed 2507  Reply by Ms. Mandell  1 for an inconsistent purpose, such as clear-cutting.  2 After the clear-cutting, Mr. Muldoe can come back to  3 his land, and like other citizens of the Province, he  4 can attempt to harvest what resources remain, if any.  5 He can do this until the Province wants to use the  6 land again for some other purpose.  The fiduciary duty  7 requires the Government not to arbitrarily interfere  8 with Mr. Muldoe's activity, but, having taken Mr.  9 Muldoe's position into account, the Province has the  10 final word and Mr. Muldoe is subject to the general  11 laws of the Province and must again leave if the  12 Province gives the resources to others.  13 Now, the Province argues, my lord, that the grant  14 of a fee simple automatically extinguishes aboriginal  15 rights.  And I just wanted to ask your lordships to  16 turn to the next tab which is some extracts from the  17 evidence of Basil Michell.  And, my lords, if I could  18 ask you to turn -- move into the tab four pages to the  19 page that's marked 1-24.  At the end:  20  21 "Q  Maybe, Bazil, you could start by telling us the  22 names of your father's sisters who lived at  23 Barrett Lake?"  24  25 And he names those ladies.  And --  26 TAGGART, J.A.:  What is the tab number?  27 MS. MANDELL:  I am sorry, it is the following tab, my lord, tab  28 7.  He names his sisters who lived at Barrett Lake,  29 and at line 16:  30  31 "Q  Basil, do you remember about how much land did  32 the people clear?  33 A We didn't have any instruments to measure the  34 amount of land cleared.  The white people had  35 just come and kicked us off our land.  The  36 people that kicked us off the land are now dead  37 and I don't know who is living there now.  38 Q  Did the people have horses at Barrett lake?"  39  40 And at line 36:  41  42 "A  I think it was under 50 horses.  43 Q  How many houses were there at Barrett Lake?  44 A About five.  There were about five houses.  45 Q  All right.  46 A And the log house here is the type of building  47 they had there." 2508  Reply by Ms. Mandell  1  2 And if your lordships would turn over to page 2-74,  3 you will have to move in some.  4 TAGGART, J.A.:  Divider number 3?  5 MS. MANDELL:  That's right.  At the bottom of the page,  6 beginning at line 36:  7  8 "Q  Basil, how did you feel when your family was  9 asked to leave Barrett Lake and the cabins  10 were burnt?  11 A  Even though we were young, we were really hurt  12 by what was done to us.  Our people had cleared  13 the land and white people just moved in and  14 chased us off the land.  We weren't very happy  15 about it.  The white people that worked for the  16 government just went home after we were chased  17 off our land and we were left to die because we  18 had to live in tents in sixty below weather.  19 It wasn't right what they did to us."  20  21 And then if you could turn the page at line 11, we  22 were talking about the cabins:  23  24 "Q  Do you know who burnt them?  25 A  It was the white people that moved on to the  26 lands.  27 Q  Did the people -- Johnny Austin and the people  28 that you've talked about who lived behind the  29 tracks in Moricetown, those people have  30 horses?"  31  32 These were some of the people that were also burnt  33 out.  34  35 " A  The people that were chased off the land also  36 had many horses as well as cows.  37 Q  When they were chased off the land what  38 happened to those animals?  39 A  The animals were moved to the area where the  40 present Full Gospel Church is on to reserve  41 land.  The horses were fed from fields that  42 were on the reserve.  Also some hay was made on  43 the swamps -- near the swamps.  44 Q  Had the people who -- Johnny Austin and the  45 people who lived with him, had they also  46 cleared the land in the places where their  47 homes had been burnt? 2509  Reply by Ms. Mandell  1 A  Yes, they did.  2 Q  Do you remember how much land they cleared?  3 Just approximately?  4 A  The area was quite large.  If you would go up  5 behind the tracks you see cleared land, that's  6 the land that they cleared.  7 Q  Did anyone besides your dad, Lame Arthur  8 Michell and Naziel go to jail during that time  9 for engaging in fights with the white people?  10 A  No, it was my father.  11 Q  What happened to your family when your father  12 was in jail?  13 A When my father was put in jail we were fairly  14 young at the time and we stayed in Hagwilget  15 and we survived on salmon that was given to us  16 by other people.  17 Q  Did your father tell the family any stories, or  18 tell to you any stories about what his life in  19 jail was like?  20 A  He didn't tell me about his experiences in jail  21 but we used to go down to Old Hazelton and  22 watch him work.  They had him working on the  23 streets."  24  25 Mr. Basil's father fought with the people that came to  26 burn them off and ultimately he was arrested and went  27 to jail for this.  28 And I say that, my lord, Basil Michell's  29 testifying to his experience as one of the  30 Wet'suwet'en people who were dispossessed by a fee  31 simple grant.  The Province continues to issue fee  32 simple grants in the territory, and it is precisely  33 for this reason that the Appellants sought, although  34 unsuccessfully, to achieve a lis pendens in the  35 action.  36 We say that the extinguishment theories advanced  37 by the Respondents and the Amicus amount to exceptions  38 to the theft rule.  The criminal law upholds a  39 fundamental injunction against theft.  The scriptures  40 teach us we do not steel.  Yet, the extinguishment  41 doctrines are all based on the taking of land or  42 resources which belong to another people without  43 paying for them or getting their consent.  It is one  44 thing for the government to operate in the interests  45 of the majority population, who wish to accomplish  46 this result.  It is quite another for these  47 governments to come to this Court, a Court of Justice, 2510  Reply by Ms. Mandell  1 and ask that those acts of unprincipled taking should  2 be sanctioned.  3 Canada has signed international covenants to  4 uphold the high and honourable principle that all  5 people have the right to self-determination.  Yet, in  6 their extinguishment arguments they show no such  7 reject.  8 The Appellants urge this Court to refuse all  9 extinguishment arguments and find that the Appellants  10 have existing rights within Section 35 to their  11 territory.  Accommodation can occur in British  12 Columbia as it has occurred in the rest of Canada,  13 based on consent, a principle articulated two hundred  14 years ago which is as sound today as it was then.  15 We say that the purpose of including Section 35 in  16 the Constitution was stated by the Ministers who  17 introduced the provision for passage through  18 parliament.  And if your lordships would turn to tab  19 9, I just wanted to read to you what was said when  20 Section 35 was introduced.  I am going to read from  21 the second page of the exhibit.  This is the speech of  22 Mr. Clark.  23  24 "I want to speak for a moment, if I might, of the  25 nature of that duty, the nature of our  26 responsibility to the aboriginal people of the  27 country.  One in this nationalist age would be  28 reluctant to quote a poet from the United States,  29 except perhaps in the case of aboriginal title,  30 because the aboriginals were here before the  31 United States or Canada was, before the  32 forty-ninth parallel meant anything more than  33 another widening in the trees.  I am struck by the  34 words of Robert Frost when speaking of Americans,  35 Canadians, people who came late to this continent.  36 He said:  37 The land was ours before we were the lands.  38 Mr. Frost was speaking of the white population,  39 not the natives.  The land of this continent  40 belonged to, was used by, the original people well  41 before the concept of land took root as something  42 that was possessed and parcelled out.  Land, to  43 the natives, was where you lived, where you worked  44 and where you took your nature.  It was heritage,  45 not just territory.  In a very real sense, land  46 and people were the same.  47 We took that away, we who came later.  We took 2511  Reply by Ms. Mandell  1 it away as an inevitable consequence of our  2 civilization and the compensation we offered was  3 often meagre, often mean, sometimes nothing at  4 all.  But the original people were here before our  5 civilization.  Our treatment, our meagre, mean  6 treatment of them, has increased our obligation,  7 not diminished it.  8 We cannot reverse history, but we can take  9 account of it.  A minimum step must be for this  10 Parliament to put in a document that deals with  11 the rights of our people and to acknowledge at  12 least the particular rights of our first people to  13 draw their life and their culture from what we  14 made our land."  15  16 And we say that Section 35 was intended to provide  17 to the First Nations protection within Canadian  18 Federation from which they could survive as First  19 Nations, with a future, not just a past.  And the  20 future depends on their existence of their rights and  21 existence -- existing rights mean non-extinguished  22 rights.  23 And I say, my lords, that the unspoken arguments  24 in favour of extinguishment sound in fears by  25 non-Indian people and governments that recognition  26 will cost too much money or will cause chaos in the  27 non-Indian economy or will "give away the store".  28 But, my lords, the declarations which the Appellants  29 are seeking are not primarily about money.  You have  30 heard submissions for a year and I don't think you  31 have heard the word "money" used.  They are about  32 respect, recognition, and survival as peoples in  33 relation to their land.  34 Regarding the issue of third party tenures, it is  35 worth recalling the words of Mr. Justice Seaton in the  36 Meares Island case.  37  38 "It has also been suggested that a decision  39 favourable to the Indians will cast doubt on the  40 tenure that is the basis for the huge investment  41 that has been and is being made.  I am not  42 influenced by the argument.  Logging will continue  43 on this coast even if some parts are found to be  44 subject to certain Indian rights.  It may be that  45 in some areas the Indians will be entitled to  46 share in one way or another, and it may be that in  47 other areas there will be restrictions on the type 2512  Reply by Ms. Mandell  1 of logging.  There is a problem about tenure that  2 has not been attended to in the past.  We are  3 being asked to ignore the problem as others have  4 ignored it.  I am not willing to do that."  5  6 And we say, the problem with tenure has been  7 shouldered by the Appellants' ancestors and should not  8 be the inheritance of their children.  And I say, nor  9 should the dispossession of the Appellants be the  10 inheritance from the non-Indian culture to my  11 children.  12 It is without facts to suggest that the Appellants  13 will not proceed sensibly into a new relationship with  14 Canada.  A healthy economy is as much a concern to the  15 Appellants as it is to the Province.  16 The Appellants, if permitted to do so, bring much  17 knowledge, passed from generation to generation about  18 how to care for the land.  And I say, my lords, that  19 every culture's knowledge is partial and the Indian  20 people have spent a lot of their cultural  21 concentration over the millennium figuring out ways to  22 take care of the land, and we can use that knowledge  23 and not simply think that we have all the answers  24 which, as Joe Clark said when he introduced the Bill,  25 "the land was ours before we were the land".  We  26 claimed it before we knew it.  Well, they knew it for  27 a long time before we claimed it, and that knowledge  28 is necessary today and should be, we say, part of how  29 co-existence can take place.  30 I say, finally, my lords, that when the Hudson's  31 Bay Company came into the Appellants' territory, the  32 historical record indicates mutual benefit which was  33 provided by that contact.  The Appellants' ancestors  34 provided surplus from their harvest to the company.  35 The company gave to the Appellants' ancestors,  36 European trade goods in return.  The European trade  37 goods were of benefit to the Appellants' ancestors.  38 The cultures taught each other.  And there is some  39 writing to say that it was a real renaissance between  40 the two cultures.  However, the Colony of British  41 Columbia and later the Provincial government sought  42 later to control the Appellants and take their land  43 for the benefit of settlers.  This Court decision can  44 play a significant role in enabling the Appellants and  45 Canada to achieve again a new and mutually productive  46 relationship, and I say there is a lot of healing  47 which needs to go on but it won't begin and it 2513  Reply by Ms. Mandell  1 wouldn't be complete until there is a recognition of  2 the Indian people as what they say in Section 35 is  3 existing.  It is worth pausing to consider the  4 different Province that this would be when the  5 Appellants are able to contribute as healthy people in  6 this global community of nations.  7 And, my lords, I just close with that and say  8 that, in my submission, the arguments of  9 extinguishment, which the onus falls on the Crown to  10 raise, they raise their conduct when they raise  11 extinguishment, and say it is our conduct which we ask  12 you to judge.  I say none of that conduct merits a  13 finding that the Appellants and their children and  14 their children's children should be dispossessed.  15 None of that conduct rises into that high standard  16 which is really the standard which was, in our  17 submission, the undercurrent or the foundation for the  18 Court's decision about the test for extinguishment in  19 Sparrow.  20 My lords, that's it for me.  I will come back,  21 though, in respect of the questions which have been  22 asked and either this afternoon or before the reply is  23 over I will address your lordships more fully in  24 respect of those.  25 TAGGART, J.A.:  All right.  Thank you.  We will take the  26 luncheon break.  27 THE REGISTRAR:  Order in court.  Court stands adjourned until  28 two o'clock.  29  30 (LUNCHEON RECESS)  31  32 I hereby certify the foregoing to  33 be a true and accurate transcript  34 of the proceedings transcribed to  35 the best of my skill and ability.  36  37  38  39  40  41 Tannis DeFoe,  42 Official Reporter,  43 UNITED REPORTING SERVICE LTD.  44  45  46  47 2514  Reply by Mr. Paterson  1 (PROCEEDINGS RESUMED)  2  3 THE REGISTRAR:  Order in court.  4 THE COURT:  Yes, Mr. Patterson.  5 MR. PATERSON:  Thank you, my lord.  My lords, just to situate  6 the speaking notes in relation to the factums, these  7 incorporate various different things that were filed  8 seriatim.  There was initially the reply to the  9 factum, which is now the R&D factum, the Amicus  10 factum, and that's found at tab 8.  I set this out in  11 the first paragraph here of the speaking notes, which  12 are at tab 2 of the speaking notes volume.  So these  13 materials come from originally the reply at tab 8A of  14 the reply factum and subsequently from the reply that  15 was filed to the revised factum of the Province, and  16 subsequently from the reply that was filed to the  17 factums of Alcan and the business coalition, and, in  18 addition, incorporate materials in response to matters  19 that arose in oral submission, principally of the  20 Province.  These notes do not replace what's in the  21 factum, they haven't tried to incorporate everything  22 in them, but seek to highlight the principal points we  23 want to make on this reply.  24 My lords, I wanted to start off -- I'm at the  25 first page of the speaking notes -- I wanted to start  26 off just by highlighting three passages, all of which  27 I will come to later on, but which I think set the  28 stage for the position we're taking on the question of  29 provincial extinguishment.  The first is from Sparrow,  30 where the court said:  31  32 "The onus of proving that the Sovereign intended  33 to extinguish the Indian title lies on the  34 respondent and that intention must be 'clear  35 and plain'.  The tests of extinguishment to be  36 adopted, in our opinion, is that the  37 Sovereign's intention must clear and plain if  38 it is to extinguish an aboriginal right."  39  40 The second passage is from Dick:  41  42 "If the special impact of the Wildlife Act on  43 Indians had been the very result contemplated  44 by the Legislature and pursued by it as a  45 matter of policy, the Act could not be read  46 down because it would be in relation to Indians  47 and clearly ultra vires." 2515  Reply by Mr. Paterson  1 And the third passage:  2  3 "Nothing, however accretes to provincial  4 legislative power by the generalization of the  5 language of provincial legislation if it does  6 not constitutionally belong there."  7  8 My lords, the basic position we take is that under  9 no circumstances whatever may the Province extinguish  10 any manner of aboriginal right or title.  It's a  11 constitutional opposition.  12 Our submissions will be the following:  13  14 a.    That the entire field of aboriginal rights  15 or titles falls within the exclusive  16 jurisdiction of Canada under Section 91(24)  17 of the Constitution Act;  18 b.    That provincial extinguishment is  19 impermissible as being in conflict with  20 existing and paramount laws of Canada --  21  22 And there we will talk about both statute and common  23 law:  24  25 c.    Extinguishment is not an "incidental impact"  26 of provincial legislation, but an  27 impermissible intrusion into an exclusive  28 legislative field;  29 d.    The required "intention" to extinguish is  30 ultra vires the Province;  31 e.    Section 88 of the Indian Act does not permit  32 the extinguishment of aboriginal rights.  33  34 My lords, the starting point of our submission is  35 with Section 91(24), the basic division of powers.  I  36 just draw attention to the words to the Province's  37 submission that Section 35 of the Constitution Act is  38 "a far better avenue" than 91(24) for assessing the  39 legitimacy of provincial laws.  40 It is submitted that this proposition is  41 irrelevant.  To be applicable, provincial legislation  42 must be constitutionally competent.  In particular,  43 legislation must fall within one of the heads of power  44 assigned to the provinces and it must not fall within  45 one of the heads of power assigned exclusively to  46 Canada.  If the legislation survives this test, it  47 must also conform to other constitutional 2516  Reply by Mr. Paterson  1 requirements, passing by the legislature and  2 proclamation and so forth.  3 This is not a question of which constituional  4 provision is a better "avenue" for assessing the  5 "legitimacy" of laws.  What is in issue is the  6 validity and applicability of various provincial  7 enactments.   To be applicable, the legislation must  8 survive every test, not most tests or the better test,  9 for constitutional validity.  10 Section 91(24) are not alternative but  11 accumulative requirements for applicability.  12 91(24) itself refers to the jurisdiction being the  13 exclusive legislative authority extending to all  14 matters coming within the classes of subjects  15 thereafter enumerated.  16 There is nothing in the language of this section  17 itself which implies any limit to the exercise of  18 federal legislative or administrative jurisdiction  19 over Indians and their lands, and there is no language  20 which would warrant the conclusion that Section 91(24)  21 comprehends "core" matters, and the "core" matters  22 dealing with Indians and Indian lands.  23 The scope of Section 91(24) is addressed by  24 Professor Hogg in his book, and I will just draw your  25 attention to the highlighted passages:  26  27 "The federal Parliament has taken the broad view  28 that it may legislate for Indians on matters  29 which otherwise lie outside its legislative  30 competence, and on which it could not legislate  31 for non-Indians."  32  33 "If Section 91(24) merely authorized Parliament  34 to make laws for Indians which it could make  35 for non-Indians, then the provision would be  36 unnecessary.  It seems likely therefore that  37 the courts would uphold laws which could be  38 rationally related to intelligible Indian  39 policies, even if the laws would ordinarily be  40 outside federal competence."  41  42 The Province rejects the proposition that  43 "aboriginal rights" is a matter of exclusive federal  44 jurisdiction.  45 We submit that it's in the very nature of an  46 aboriginal right that it pertains exclusively to  47 aboriginal peoples.  It is impossible, in our 2517  Reply by Mr. Paterson  1 submission, to conceive of such a right over which  2 parliament would be denied the jurisdiction to  3 legislate.  The "aboriginality" of the right in  4 question would meet the "rationally related" test  5 suggested by Professor Hogg and bring the matter  6 within the scope of 91(24) .  7 The Province, in its submissions, has confused, we  8 submit, and confounded the question of exclusive  9 federal jurisdiction with the "enclave" theory and  10 implicitly argues that the rejection of the enclave  11 theory requires the rejection of the proposition the  12 jurisdiction was exclusive.  13 Legislative Jurisdiction over Indians and their  14 lands is not concurrent or shared with the Province in  15 any degree.  And I just ask you to make a note at that  16 point.  I'm not going to take you to it, but I would  17 refer you to -- you will see at the bottom of the page  18 the Bell Canada case, which is at Volume A-55, tab 5,  19 and there are references to the question of concurrent  20 jurisdiction at pages 172 and 231 that I would rely  21 on.  22 This jurisdiction is not -- is exclusive to  23 Canada, it's not an exception or subset of provincial  24 powers, but an independent head of jurisdiction.  The  25 provincial legislation which can properly be  26 characterized as legislation in relation to Indians or  27 lands reserved for Indians is accordingly ultra vires.  28 The question, then, is to determine whether  29 legislation which, on its true construction, would  30 extinguish aboriginal title is properly characterized  31 as legislation in relation to Indians or lands  32 reserved for the Indians.  33 Which takes me to the question of core interests  34 that has been argued.  The Province has described  35 various matters as going to "core rights" and "core  36 matters", and suggests that these are 91(24) matters,  37 a narrower group of matters than those comprehended by  38 Section 35.  We reject that description.  39 We submit that all of the tests relied on by the  40 Province in their discussion of "core interests", and  41 there are a variety, I give some samples there, when  42 reduced to their fundamental are not aimed at  43 identifying "core interests" of Indians, but are  44 directed to the question of whether or not the  45 legislation is "in relation to" a matter subject to  46 the exclusive jurisdiction of parliament.  This is  47 apparent from the way the test is framed in Bell v. 2518  Reply by Mr. Paterson  1 Quebec, where Justice Beetz says:  2  3 "...works, such as federal railways, things,  4 such as land reserved for Indians, and persons,  5 such as Indians, who are within the special and  6 exclusive jurisdiction of Parliament, are still  7 subject to provincial statutes that are general  8 in their application, whether municipal  9 legislation, legislation on adoption, hunting  10 or the distribution of family property;  11 provided, however, that the application of  12 these provincial laws does not bear upon those  13 subjects in what makes them specifically of  14 federal jurisdiction."  15  16 Though the Province is unable to define with  17 precision what are and what are not "core" interests,  18 they describe, in their speaking notes, that "core"  19 interests would include Indian status and  20 registrability and right to possession of lands,  21 ownership of immovable property on statutory reserves.  22 Matters which have been considered "non-core" include  23 hunting, fishing, adoption and labour relations.  The  24 Province admits that there is no consensus as to what  25 is "core" among the judiciary.  They attempt, however,  26 to consider what might be "core" for the appellants on  27 the basis of evidence as to the nature of the  28 territory, nature of society, present attitudes,  29 consequences on them of governmental interference, the  30 weight of evidence as to boundaries, and other  31 factors.  32 LAMBERT, J.A.:  Can I just stop you there.  33 MR. PATERSON:  Yes.  34 LAMBERT, J.A.:  That sentence that starts:  35  36 "Matters which have been considered "non-core"  37 include hunting, fishing, adoption and labour  38 relations."  39  40 -- in reference to para 228P, are those other cases, I  41 mean are those decisions which have held that these  42 are matters that are "non-core"?  43 MR. PATERSON:  Well, I will come to what those cases decide my  44 lord, but those are cases, I would emphasize, first of  45 all none of which concern extinguishment, which I will  46 argue is central in this matter.  Those are cases  47 which deal with whether legislation goes to -- whether 2519  Reply by Mr. Paterson  1 legislation was in relation to a matter of federal  2 jurisdiction, that is Indians and lands reserved for  3 Indians.  And then, secondly, the effect of Section 88  4 on those and what happens through Section 88.  5 LAMBERT, J.A:   Are you going to give us the cases or come to  6 the cases --  7 MR. PATERSON:  I will.  8 LAMBERT, J.A.:  -- that support -- that show that those matters  9 have been considered "non-core"?  10 MR. PATERSON:  No.  I'm not going to say that those matters have  11 not been considered "non-core", I'm going to say that  12 that's not what those cases were considering at all.  13 LAMBERT, J.A.:  So this sentence -- what you're really saying is  14 that the Province submits --  15 MR. PATERSON:  That's right, my lord.  I'm sorry.  These are a  16 summary of the propositions set out in the paragraphs  17 that are being referred to in the Province's --  18 LAMBERT, J.A.:  In the Province's —  19 MR. PATERSON:  This paragraph is summarizing what I understand  20 to be the Province's position, which I am then going  21 to say I don't agree with.  Is that --  22 LAMBERT, J.A.:  Yes, yes, all right.  While I've stopped you,  23 Mr. Braker said on Friday afternoon that his  24 submission was that those things which were "core"  25 were precisely co-extensive with those things which  26 are aboriginal rights, that neither is greater nor  27 lesser -- less than the other, they entirely coincide.  28 To some extent that may have been put into his mouth  29 by the nature of the question that he was asked, but I  30 hope that we will have your submission on whether  31 "core" is bigger or smaller or precisely co-extensive  32 with aboriginal rights.  33 MR. PATERSON:  My submission, I will come to it, but just to  34 anticipate the point, I think what I would say  35 generally is that the issue that has been described in  36 some of the cases as "core", in fact, I address it at  37 paragraph 14, but I come to it later, is it directed  38 to the question not of indentifying what are "core  39 interests" of Indians, but what is central to the  40 exclusive legislative jurisdiction of Canada, what  41 makes it a question of federal jurisdiction.  And so  42 the core question is addressed to a -- to the issue of  43 contitutionality rather than identifying rights on the  44 ground.  And I will develop that in more light further  45 on.  46 At paragraph 16 it is submitted that the "core  47 rights" analysis of the Province is incompatible with 2520  Reply by Mr. Paterson  1 Bell.  The Province would have the courts and the  2 parties engaged in an on-the-ground site by site  3 analysis determining whether this or that detail is or  4 is not "core" and thus capable or not of being  5 extinguished by the Province.  Matters held to be  6 "core" would form an enclave immune from the operation  7 of provincial laws.  Other matters would fall to be  8 extinguished by inconsistent action on the part of the  9 Province.  10 If the submission of the Province is to be  11 accepted, the constitutional protection of aboriginal  12 rights contemplated by Section 91(24) would die the  13 proverbial death of a thousand cuts as the Province  14 successively eroded and extinguished "non-core"  15 rights, thereby marginalizing the remainder for future  16 extinguishment.  You start off with the proposition  17 that 22,000 square miles are not necessary to be an  18 Indian, then you move to a question of maybe 21,000  19 aren't, and maybe 20,000 aren't.  And what I'm saying  20 is this whole notion of identifying rights on the  21 ground as "core" will always leave the outside border  22 as appearing "non-core" in relation to the centre and  23 therefore opening up for ongoing and perpetual  24 erosion.  The Province would thereby, by its own acts,  25 expand its constitutional area of competence at the  26 expense of the federal government and its land and  27 resource base at the expense of the Appellants.  28 The constitutional concept of "core" is intended  29 to characterize matters in relation to classes of  30 subjects of federal and provincial exclusive  31 jurisdiction respectively.  It is not intended as a  32 description of rights on the ground and the manner of  33 their exercise.  And now I will come to a few  34 examples.  35 The Province insists that "culture" is not a "core  36 value", at least when standing alone, thus raising the  37 spectre of provincial powers to outlaw the potlatch  38 under its property and civil rights powers or to  39 resurrect residential schools.  40 In response to a question from Mr. Justice  41 Hutcheon as to whether the selection of a chief would  42 be a "core" matter, counsel for the Province  43 responded:  44  45 "As an example, and that brings a good  46 distinction between aboriginal rights and core.  47 One of the things that is particularly of the 2521  Reply by Mr. Paterson  1 core under 91(24), is the right to elect a  2 chief.  The Indian Act sets out provisions, and  3 the right of band members to elect a band  4 council and the band council to then nominate  5 the chief.  That's a 91(24) interest.  The  6 traditional or historic or aboriginal right to  7 select a chief through another process, is a  8 Section 35 interest."  9  10 This view, with respect, is absurd.  If local  11 government of Indians falls within Section 91(24),  12 then it is a matter of federal jurisdiction.  In fact,  13 there are a great many bands, and my understanding is  14 about 35 percent of all of the bands in Canada, which  15 have traditional or customary self-government and some  16 bands which have no council at all, just a chief.  17 The Indian Act expressly recognizes all these  18 forms of self-government, and sets out in Section 2  19 the definition section "council of the band" means in  20 the case of a band to which Section 74 applies, the  21 council established pursuant to that section.  That's  22 the process referred to by the Province in argument.  23 And in the case of a band to which Section 74 does not  24 apply -- and Section 74 is simply applied by an  25 Order-in-Council to a particular named band -- it  26 would be the council chosen according to the custom of  27 the band, or, where there is no council, the chief of  28 the band chosen according to the custom of the band.  29 The notion that provincial power to encroach on  30 the powers of a council is defined in the Indian Act  31 depends upon whether it has been established under or  32 outside the optional provisions of Section 74 is  33 untenable and clearly illustrates the manifest  34 problems arising from the methodology proposed.  By  35 the logic of their position, part (b) of the  36 definition above would fall outside Section 91(24) .  37 With respect, it is inconceivable that a court would  38 reach such a result.  It is equally inconceivable that  39 a court would permit the interference with the  40 establishment, operation or management of a band  41 government by a province, no matter what form that  42 government took.  43 As with Section 18 of the Indian Act, which Guerin  44 held to protect the pre-existing aboriginal interest  45 in Indian lands, so, too, this provision does not  46 create, but serves to protect a pre-existing right of  47 self-government.  It does not follow that absent this 2522  Reply by Mr. Paterson  1 statutory recognition, the traditional right is  2 "non-core", while the creation of the legislature,  3 which may be less apppropriate to the particular band,  4 is somehow "core".  5 It is worth remembering that the Inuit, who have  6 Section 91(24) rights, have neither bands nor councils  7 nor reserves.  There are Inuit populations not only in  8 the federal northern territories but also in the  9 Provinces of Quebec and Newfoundland.  By the logic of  10 the Province's submission, they would have almost no  11 "core rights".  12 The problem of identifying "core rights" can also  13 be clearly seen in relation to the matter of labour  14 relations.  Contrary to the Province's submission,  15 Four B, the Supreme Court case Four B, did not hold  16 that "labour relations" is "excluded from the core set  17 of interests".  Four B held that provincial labour  18 legislation applied to a shoe factory regardless of  19 its location, ownership, or the makeup of its employee  20 group.  Justice Beetz, in that decision, and this is  21 as a qualification on the observation of ownership, in  22 that decision expressly noted that the business in  23 question was not owned by the band and that the band  24 itself had no share in the profits.  And, in fact, he  25 refers in the decision to a fact that the band in a  26 band meeting had voted down a proposition that this be  27 undertaken as a band matter.  In those circumstances  28 ownership by individuals who were members of the band  29 was not constitutionally significant.  30 Labour relations is, in constitutional terms, a  31 matter and not a class of subjects.  Labour relations  32 in relation -- legislation in relation to labour  33 relations is then not per se federal or provincial.  34 The issue of constitutionality is not determined by  35 finding that the legislation is in relation to labour,  36 but by determining the class of subject it relates to.  37 If the labour legislation is in relation to property  38 and civil rights in the province, as it most often is,  39 the Province has exclusive jurisdiction.  If the  40 labour legislation is in relation to a class of  41 subjects assigned to the Federal Government, the  42 jurisdiction is exclusively federal.  43 Cases subsequent to Four B have held that  44 provincial labour legislation does not apply to an  45 Indian band or band council per se, as such would  46 invade Parliament's exclusive jurisdiction.  The  47 Whitebear case considered the effect of provincial 2523  Reply by Mr. Paterson  1 labour legislation on employees hired and directed by  2 the band council.  And I might add, they were hired by  3 the band council to build housing on the reserve.  The  4 court there held -- the Saskatchewan Court of Appeal  5 held that the provincial labour legislation did not  6 apply to these persons, distinguished the Four B  7 decision.  8 The court applied the functional test and said:  9  10 "Having regard for the nature of the service,  11 business, work or undertaking involved and its  12 operations and normal activities, can it be  13 characterized as federal?  Only if the answer  14 is positive will federal jurisdiction prevail."  15  16 The band council was found to have a federal  17 function.  The power to regulate its labour relations  18 was, accordingly, an integral part of primary federal  19 jurisdiction in relation to "Indians, and lands  20 reserved for the Indians" and provincial legislation  21 could have no application.  22 The court held the regulation of labour relations  23 in these circumstances was beyond provincial  24 jurisdiction, and immune from provincial law, whether  25 or not Parliament has legislated.  26 The significance of this decision is that  27 provincial legislation, intra vires in respect of  28 matters subject to provincial jurisdiction cannot  29 operate to impair matters subject to federal  30 jurisdiction, even in the absence of conflicting  31 legislation.  32 An application of federal labour legislation to  33 employees of Indian band councils was also confirmed  34 in Supreme Court of Canada in the P.S.A.C. case that I  35 refer to there.  The point of this exercise is to say  36 it doesn't help to say that labour relations are  37 "core" or "non-core".  The point is that what has to  38 be addressed in respect of a piece of legislation, the  39 constitutionality of which is challenged, is whether  40 that legislation goes to the core of the subject  41 matter of federal jurisdiction.  42 A similar exercise could be undertaken in relation  43 to lands.  44 The Province, in its argument, recited the  45 following passage from the trial judge and said:  46  47 "I cannot find lack of access to aboriginal land 2524  Reply by Mr. Paterson  1 has seriously harmed the identity of these  2 peoples."  3  4 And concludes:  5  6 "Now that, I would submit, my lords, is a  7 finding that goes to the question of core, the  8 central core under 91(24)."  9  10 Bearing in mind that the core speaks to  11 constitutionality, the above comment is problematic  12 for two reasons.  First, it reduces the question of  13 entitlement, and entitlement to lands, to the degree  14 of harm to "identity" caused by deprivation, which is  15 not a proper test for constitutional jurisdiction.  16 And, second, it offers no principled basis for  17 concluding that Indian reserves are not equally  18 "non-core".  Paramountcy of a federal legislative  19 scheme is not an answer to the Province's submission  20 which is put on the footing of constitutional  21 competence.  Indeed, the Province relies on cases such  22 as Four B to show that reserves are no more "core"  23 than any other 91(24) lands.  24 The comments of the trial judge and commentary of  25 counsel should be compared to the following from Bell:  26  27 "I readily admit that Alltrans might have  28 complied" --  29  30 And in this case it was the regulations requiring  31 workers to wear safety boots and to form a safety  32 committee:  33  34 "-- without experiencing any impairment.  35 The impairment test is not necessary in cases  36 in which, without going so far as to impair the  37 federal undertaking, the application of the  38 provincial law affects a vital part of the  39 undertaking."  40  41 In its submission the Province, in effect, is saying  42 you must look to see if "safety boots" are at the core  43 of a federal undertaking, rather than seeing that as a  44 mere instance of "working conditions", a vital part of  45 the management of a federal undertaking.  46 It could likely be said that the Indians of the  47 Semiahmoo band, and this is in the Surrey and Peace 2525  Reply by Mr. Paterson  1 Arch case, you may recall what was in issue there was  2 an attempt to apply provincial health regulations to  3 the construction of a restaurant on lands that were  4 surrendered from -- by the Semiahmoo band, but the  5 Indians of the Semiahmoo band were not "seriously  6 harmed" as to their identity by the attempted  7 application of these regulations to premises  8 constructed on surrendered lands, premises run by  9 non-Indians.  That case, however, was decided on the  10 footing that if the land was "lands reserved for the  11 Indians" within the meaning of 91(24), then provincial  12 statutes going to their use would have no application.  13 This judgment cannot be reconciled with the  14 methodology advocated by the Province.  15 It is submitted that it is an exercise in  16 sophistry to attempt to make a classification of  17 rights, and that is a right on the ground as "core"  18 and "non-core".  Inevitably, as the Province has  19 already done in argument, such a process will tend to  20 identify rights granted by the state as "core" and  21 pre-existing aboriginal rights as "non-core".  The  22 Province has taken this path in respect of lands, that  23 statutory reserves are core; other lands are non-core,  24 in relation to status, where status under the Indian  25 Act is core.  It's unclear how this would apply to the  26 Inuit, or for that matter, Metis, and self-government,  27 where we discuss the statutory scheme versus the  28 customary manner of selecting chiefs.  29 With respect, this flows from a miscomprehension  30 of the nature of the tests imposed by the courts in  31 the cases replied on.  The task is not to identify  32 "core rights" or "core interests" or "core values",  33 the interference with which is impermissible, but to  34 characterize legislation according to its true pith  35 and substance.  36 In his oral submission, counsel for the Province  37 submitted that:  38  39 "...it is absurd... to suggest that one needs  40 the right to roam freely unimpeded by any other  41 competing uses over 22,000 square miles of  42 territory to be an Indian.  That cannot be at  43 the core.  You don't need 22,000 square miles  44 to be an Indian."  45  46 That is the wrong test.  The correct analysis is  47 to ask whether the legislation, which discloses a 2526  Reply by Mr. Paterson  1 clear and plain intention to extinguish aboriginal  2 title or rights is, at least to that extent,  3 legislation in relation to Indians or lands reserved  4 for the Indians.  If so, it has invaded to the heart,  5 or, if you wish, to the core of federal jurisdiction,  6 and the legislation is ultra vires or inapplicable, as  7 the case may be.  The degree of interference or  8 impairment of the right is irrelevant at this stage.  9 It later becomes relevant when considering if an  10 otherwise inapplicable provincial statute can be given  11 federal effect under Section 88.  In that case the  12 degree of impairment might evidence, or in the case of  13 extinguishment, require an intent, purpose or policy  14 of interfering with aboriginal rights.  In such cases,  15 Section 88 won't operate.  And that, my lords, is what  16 I say the exercise was that was undertaken in, for  17 example, the Dick case and those tests that were  18 referred to earlier.  19 The point is made in the Bell case:  20  21 "It is not relevant whether the Act impairs or  22 not the operations and functioning of Bell  23 Canada and Canadian National.  It suffices that  24 the application of the Act bear upon" --  25  26 And just says "bear upon":  27  28 "-- the undertaking in what makes it  29 specifically of federal jurisdiction for that  30 undertaking to fall outside the ambit of this  31 legislation."  32  33 What is significant about the passage is that it  34 is clear that the court is not looking at whether the  35 provincial act will impair a "core interest" of the  36 federal undertakings.  Rather, it has made an analysis  37 and determined that the legislation, if construed to  38 apply to federal works and undertakings, would thereby  39 be legislation in relation to a class of subjects  40 assigned to the exclusive jurisdiction of Parliament.  41 The operative phrase is not "core interest", but "what  42 makes it specifically of federal jurisdiction".  If  43 the legislation bears upon this element, it is ultra  44 vires or inapplicable without regard to the extent, if  45 at all, it impairs the operation of the federal  46 undertaking.  47 This point is strongly made in A.G. Alberta and 2527  Reply by Mr. Paterson  1 A.G. Canada, it's a 1915 case of Privy Council, where  2 Lord Moulton held that provincial legislation which  3 permitted provincial railway lines to cross over  4 federal lines was ultra vires.  I might say, the  5 footing on which the case was argued there was a  6 hypothetical case.  The legislation in the province in  7 the past enabled provincial trains to cross over  8 federal tracks, and the contention was that that was  9 ultra vires the Province being in relation to  10 railways, federal undertakings.  And so the case was  11 put -- argued before the Privy Council on a  12 hypothetical basis, and that is suppose a series of  13 federal lines were joined up so they created a circle  14 and made a section of the province inaccessible to the  15 Province of Alberta because it couldn't cross a  16 federal line.  The Privy Council held that the  17 legislation was nonetheless "legislation is to the  18 physical tracks and works of the Dominion railway, and  19 as such would be beyond the competence of the  20 Provincial Legislature":  21  22 "It is therefore not in abstract constitutional  23 rights but in administrative provisions that  24 the remedy must be sought for the  25 inconveniences which in the abstract might  26 flow" --  27  28 That is flow to the Province in this particular case:  29  30 "-- from the fact that the exclusive power of  31 legislating as to Dominion railways is vested  32 in Parliament."  33  34 The relevant test is not whether the interference  35 is with a "core right", but whether it is directed to  36 a matter at the core of federal jurisdiction --  37 whether it affects a matter within federal  38 jurisdiction in respect of its particular federal  39 aspect.  4 0 To the extent that impairment is often examined by  41 the court, this is not because impairment is a  42 necessary element of the test of vires, but rather  43 that impairment of a vital element, in the words of  44 Justice Beetz:  45  46 "...is an almost certain sign that such  47 application bears upon the specifically federal 2528  Reply by Mr. Paterson  1 nature of the undertaking and constitutes an  2 encroachment on the exclusive legislative  3 authority of Parliament."  4  5 The Bell test yields dramatically different  6 results from the "core" analysis of the province.  If  7 the legislation (or administrative act authorized by  8 the legislation) bears upon lands subject to  9 aboriginal title so as to extinguish that feature  10 which is particular to federal jurisdiction in  11 relation to those lands, that is their aboriginality,  12 then the legislation cannot apply, and it is  13 irrelevant whether the interference in question is  14 massive or trivial.  Questions about "culture plus",  15 and I want to emphasize here, I'm discussing and I'm  16 limiting this discussion to the question of  17 extinguishment.  The question is whether provincial  18 legislation bears upon lands subject to aboriginal  19 titles so as to extinguish that feature which is  20 particular to federal jurisdiction in those lands,  21 their aboriginality, then it can't apply.  Questions  22 such as "culture plus" and statutory and customary  23 forms of self-government, and how many square miles it  24 takes to be an Indian can be discarded.  25 It is submitted that the very nature of  26 extinguishment compels the finding that any act of the  27 Province which destroys the subject matter of federal  28 jurisdiction, that is the aboriginal right, which  29 makes the matter formally of federal jurisdiction  30 thereafter incapable of being the subject of federal  31 jurisdiction, which displays the requisite intent to  32 extinguish aboriginal rights, must of necessity bear  33 on what makes the matter in issue federal and is, as a  34 result, legislation in relation to a class of subject  35 within the exclusive jurisdiction of Parliament, and,  36 hence, ultra vires or inapplicable.  37 The Province relied on a variety of cases,  38 including Dick, Kruger and Manuel, Natural Parents and  39 Derrickson.  In none of those cases was extinguishing  40 legislation found.  In Kruger and Manuel and Dick, the  41 legislation was found to regulate and possibly  42 interfere with the exercise of the right to hunt, but  43 there was no suggestion of extinguishment.  In  44 Natural Parents, adoption legislation was held, on its  45 proper construction, and that construction being  46 achieved by reading down the legislation as a matter  47 of constitutional construction, not to affect the 2529  Reply by Mr. Paterson  1 status of an Indian child.  In Derrickson, provincial  2 legislaton which affected the entitlement to land in a  3 reserve was held to be constitutionally inapplicable.  4 Section 88 question didn't arise, it was only  5 discussed tangentially.  6 It is submitted the Province has also misconceived  7 the "status and capacity" test.  This is simply, in  8 our submission, one element in asking, in appropriate  9 circumstances, whether the legislation bears on what  10 makes a matter federal.  11 In some circumstances, federal legislation is  12 determined by the status of the affected person.  A  13 province may not affect the status of an alien by  14 granting or denying citizenship or other fundamental  15 rights.  A province may not deprive an Indian of his  16 or her constitutional status.  A province may not  17 deprive a federally incorporated company of its status  18 or capacity.  A province may not affect the status or  19 capacity of a company engaged in a federal work or  20 undertaking.  21 However appropriate the test of "status or  22 capacity" may be to determining the degree of  23 interference imposed by non-extinguishing provincial  24 regulatory legislation, as in Dick, the test is of no  25 assistance in addressing the extinguishment of rights,  26 whatever they may be.  The test is also probably  27 inappropriate in determining interferences with "lands  28 reserved for the Indians" as opposed to "Indians".  29 In Dick and Kruger the test of "status and  30 capacity" was used to assess the impact on "Indians"  31 not on "lands" pursuant to Section 88 of the Indian  32 Act.  With respect to "lands", the equivalent  33 question, I submit, would be whether the provincial  34 legislation affected the status of the lands, that is  35 as lands subject to be aboriginal title.  The test  36 advocated by the Province, that "grants constitute  37 extinguishment" only invade federal jurisdiction in  38 relation to "Indians" when they strike at Indian legal  39 status and capacity is of no help.  Either it avoids  40 the subsequent question, which is when do such grants  41 invade federal jurisdiction in relation to "lands  42 reserved for the Indians".  Alternatively, the test  43 simply states that all grants are valid, no matter  44 what the Indian interest, because Indian "status" will  45 not be impaired, even if all lands are granted.  46 It is submitted that the "status and capacity"  47 test is merely an application in the particular 2530  Reply by Mr. Paterson  1 context of the more general test set out in Bell.  2 That is does it affect a matter in what makes it  3 specifically a federal jurisdiction.  In this regard  4 it is significant that Mr. Justice Beetz is both the  5 author of Dick and the Bell decisions.  6 Alternatively, the phrase "status and capacity"  7 should be read as "constitutional status and  8 capacity", and Indian lands and rights have the  9 constitutional status of being federal lands and  10 rights, at least to the extent of the aboriginal  11 interest therein.  12 Federal jurisdiction is also not limited but to  13 its present exercise in the Indian Act.  It is settled  14 law, for example, that the Inuit fall under federal  15 jurisdiction, though they are not included in the  16 Indian Act.  It is likely that Metis and other  17 "non-status Indians" could also be the subject of  18 valid federal legislaton under Section 91(24) .  I  19 point out the inclusion of Metis in Section 35 of the  20 Constitution Act 1982.  21 It is equally settled law that federal  22 jurisdiction does not end with Indian reserves under  23 the Indian Act.  This is clear from the judgment of  24 the Privy Council in St. Catherine's Milling where  25 Lord Watson said that:  26  27 "...counsel for Ontario referred us to a series  28 of provincial statutes prior in date to the Act  29 of 1867 for the purpose of showing that the  30 expression "Indian reserves" was used in  31 legislative language to designate certain lands  32 in which the Indians had, after the Royal  33 Proclamation of 1763, acquired a special  34 interest, by treaty or otherwise, and did not  35 apply to land occupied by them in virtue of the  36 Proclamation."  37  38 He went on to say:  39  40 "The words actually used are, according to their  41 natural meaning, sufficient to include all  42 lands reserved, upon any terms of conditions,  43 for Indian occupation."  44  45 The argument put to the court in St. Catherine's  46 Milling sought to limit federal jurisdiction over  47 Indian lands to specific lands over which "special 2531  Reply by Mr. Paterson  1 interests" were obtained by the Indians, rather than  2 over the entirety of the Proclamation lands.  Apart  3 from the question whether lands in British Columbia  4 are covered by the Proclamation, there can be no doubt  5 that the lands in Ontario were subject to this  6 general, as opposed to "special" reserve, and that  7 those lands were very very great indeed and fell  8 within federal jurisdiction.  In other words, at the  9 time of Confederation, it was not a remarkable  10 proposition that the lands and resources of an  11 enormous part of the territory of a province would be  12 subject to federal jurisdiction under 91(24) .  That  13 was indeed the case with both Ontario and Quebec, as  14 confirmed in St. Catherine's Milling.  15 St. Catherine's Milling did not hold that "lands  16 reserved for the Indians" had to be specially set  17 aside.  Indeed, the tenor of the passage cited above  18 is to the contrary.  There is a sense in the passage  19 of a generally broad reservation by the Proclamation  20 and more -- and then the discussion of that was  21 contra-distinct to a special interest acquired by  22 treaty or otherwise.  To the extent there is  23 ambiguity, however, the following factors are  24 relevant:  First, the issue in that case was whether  25 the lands covered by the Royal Proclamation fell  26 within Section 91(24), and the issue of  27 non-Proclamation lands was not considered.  Second,  28 Lord Watson in a judgment was himself under the  29 erroneous apprehension (which wasn't relevant to the  30 matter before him) that the Royal Proclamation was  31 itself the source of aboriginal title.  This part of  32 the judgment has now been overruled.  33 In Guerin, the court held that the Indian interest  34 in land did not derive from a Crown grant, it was  35 pre-existing interest.  It has been repeatedly held  36 that this interest falls within federal jurisdiction.  37 I then refer to a number of authorities.  Those  38 authorities were all referred to this morning by Miss  39 Mandell and I won't go into them.  They're set out at  40 paragraphs 90 to 97 of her --  41 TAGGART, J.A.:  Now, in Guerin, as I understand it, the lands in  42 issue, where lands forming a part of the Musqueam  43 Reserve, and they went through the usual procedure of  44 surrendering a portion of those lands to Canada in  45 order that Canada may -- might, on behalf of the band,  46 enter into an arrangement with the tenant of the  47 lands. 2532  Reply by Mr. Paterson  1 MR. PATERSON:  Yes.  2 TAGGART, J.A.:  The ultimate tenants of the lands.  Am I correct  3 in that?  4 MR. PATERSON:  That's correct, my lord.  5 TAGGART, J.A.:  They were literally a part of a reserve for the  6 Indians.  7 MR. PATERSON:  That's correct, my lord.  8 TAGGART, J.A.:  And I take it that's the sense of the words in  9 Section 91(24), is that they must be lands reserved  10 for the Indians.  11 MR. PATERSON:  I will argue, my lord, that that's not the case,  12 and I will argue that Guerin is decided entirely on  13 the basis of common law aboriginal title, which is  14 then applied by incorporation to an Indian reserve,  15 and Guerin is not a case about Indian reserves at all,  16 except in respect that that's the subject matter of  17 the case of the land in issue.  But my submissions,  18 and I'm coming to them, I will come to them shortly,  19 but will be to the effect that the decision in Guerin,  20 the reasoning is entirely based on the common law of  21 aboriginal title.  22 TAGGART, J.A.:  What then would -- we've had the procedure in  23 this province over the years of setting aside reserves  24 for the Indians and all the work that's done to  25 accomplish that result, travelling through the  26 province to assess the requirements of the Indians,  27 what they thought they needed and so on, surveying,  28 and setting aside those lands for the Indians.  And  29 then remedial commissions in the form of at least in  30 one instance of the McKenna-McBride Commission, and  31 the perpetual negotiations and discussions between the  32 Province, on one hand, and Canada on the other, the  33 Province wanting to give up as little as possible of  34 "its lands".  If in respect of all this claim these  35 are within the phrase "lands reserved for the  36 Indians", why did Canada bother with British Columbia  37 at all?  38 MR. PATERSON:  Well, that's a very large question, my lord, and  39 I'm not sure that I can answer all of it, but let me  40 suggest some portions of it.  One is that certain of  41 those lands have been brought within an administrative  42 regime under the Indian Act which does not apply to  43 lands which are not Indian reserves.  So I'm not  44 saying there's no difference between reserve lands.  I  45 am saying Guerin addresses the question of the federal  46 fiduciary duty on the basis of common law reasoning.  47 So that would be one point. 2533  Reply by Mr. Paterson  1 The second point is I think there's no doubt the  2 Province at least acted under the apprehension that  3 these were all its lands, but that apprehension may  4 have been misconceived if in fact our construction of  5 the Section 109 of the Constitution Act is correct.  6 The third —  7 TAGGART, J.A.:  The point of fact, if Miss Mandell is correct,  8 that upon the arrival of European interests in this  9 province, at that time the Indians enjoyed aboriginal  10 interests in all of the lands now found within the  11 borders of the Province of British Columbia.  If that  12 is correct, and you then overlay that with the  13 constitutional provisions of Section 91(24), then  14 notwithstanding Section 109, I see no room on your  15 argument for any provincial interest.  16 MR. PATERSON:  Well, my lord, there is, though it's much more.  17 TAGGART, J.A.:  Can you define it for me?  What's left?  18 MR. PATERSON:  I mean I am not saying that Indian lands anymore  19 than Indian reserves are an enclave that are immune  20 from provincial legislation.  What I'm saying is that  21 the Province can't extinguish Indian interest in  22 lands.  But I agree that the implications of the  23 proposition are very substantial indeed.  Its  24 implication is that there is a great deal of  25 unfinished business to deal with.  26 TAGGART, J.A.:  Well, a lot of people have spent a lot of money  27 doing a lot of different things under a very major  28 misapprehension, it seems to me.  29 MR. PATERSON:  Well, that's exactly right, my lord, and I would  30 agree with that, and the question now is to find out  31 and to sort out -- I mean it won't be done all in this  32 case and it won't be done in a short period of time,  33 how we sort that out.  It is our proposition that a  34 very considerable wrong has been done through the  35 decision of the Province, made more than a century  36 ago, but fairly consistently carried out over more  37 than a century, to simply act willy-nilly as if there  38 was nothing to deal with and to operate on that legal  39 assumption.  And we're saying the assumption was  40 ill-founded and that consequences flow from that.  41 TAGGART, J.A.:  It also raises in my mind the question of why  42 you're negotiating with the Province and want us to  43 deal with subjects in order that that negotiation may  44 proceed and not with Canada.  Perhaps you are  45 negotiating with both of them, I don't know, but all  46 these questions come to my mind given the reach of the  47 submissions that you and Miss Mandell seem to be 2534  Reply by Mr. Paterson  1 making.  2 MR. PATERSON:  My lords, there were attempts to bring Canada  3 into the negotiation in that process.  They were  4 unsuccessful.  5 TAGGART, J.A.:  They've got enough on their hands.  6 MR. PATERSON:  Canada declined to participate in those  7 discussions.  But as a general proposition, there is  8 no question that negotiating and sorting out all the  9 various substantial questions involve the Province and  10 Canada and the aboriginal peoples.  11 At paragraph 63, my lords, in resisting the  12 conclusion that lands subject to aboriginal title are  13 "lands reserved for the Indians" within the meaning of  14 Section 91(24), the Province lays emphasis on the word  15 "reserved" and insists that this imports a requirement  16 that the lands be specially set aside.  And I say  17 that's comparable to the argument that was rejected by  18 St. Catherine's Milling.  19 The Province proposes to limit Section 91(24) to  20 jurisdiction to lands "set aside or designated for  21 Indian occupation".  We say there is no authority for  22 this proposition.  23 The Constitution Act provides not for lands "set  24 aside" or "designated" for Indians, but lands  25 "reserved" for the Indians.  There is no justification  26 for putting into the Constitution requirements and  27 words which are not found there.  28 The Province seeks comfort from a definition found  29 in Black's Law Dictionary which redefines "reserved"  30 as "retained, kept or set apart for a purpose or a  31 person".  We submit that this definition does not  32 support the conclusion sought to be drawn from it,  33 that land must be "set aside" or "designated".  34 To the contrary, it is clear on the face of the  35 definition that "reserved" has two different types of  36 meaning.  In its active sense, "reserved" contemplates  37 a positive act of reserving.  And that's what I take  38 to be part of the discussion in St. Catherine's  39 Milling, the distinction being drawn by Lord Watson.  40 This is indicated by the words "set apart", the  41 Province -- in the definition I just quoted from.  The  42 Province relies on this portion of the definition to  43 the exclusion of the rest.  In its passive sense, a  44 thing may be "reserved" which is merely retained or  45 kept.  This does not import any positive act of  46 reserving, but merely a failure to use in a manner  47 contrary to the function of the reserve.  Similar 2535  Reply by Mr. Paterson  1 meanings can be found in the Oxford Dictionary which  2 offers as definitions of the verb "reserve", "to  3 refrain from using or enjoying at once" and "to retain  4 or preserve, to continue to have, possess or show".  5 Accordingly, lands are "reserved for Indians" where  6 those lands were originally subject to aboriginal  7 title, and have not been taken from the Indians by a  8 positive act of extinguishment -- I would include in  9 that a lawful act of extinguishment -- by treaty or  10 otherwise.  11 There is no reason to limit the scope of Section  12 91(24) to lands which have been reserved by an act of  13 the sovereign.  It is submitted that the Province  14 seeks to bring in through the back door the  15 discredited proposition that aboriginal title or  16 rights to land depend on governmental grants or  17 recognition.  Such a view cannot survive the Guerin or  18 Roberts decisions.  I will come to those further on.  19 In the alternative, if contrary to our  20 submissions, an act of reservation is required, it is  21 submitted that such was accomplished by Section 109 of  22 the Constitution Act of 1867, which provided that the  23 Province would have ownership of lands "subject to"  24 unextinguished aboriginal title which has been held to  25 be opposable to the interest of the Province.  And  26 that passage was read to you by Miss Mandell earlier  27 today.  28 We adopt the submissions of the Intervenor  29 Carrier-Sekani Tribal Council that the Province cannot  30 unilaterally unburden itself of the Section 109  31 encumbrance to its title.  32 The question of whether common law aboriginal  33 title falls within the jurisdiction of Section 91(24)  34 has been finally and conclusively settled by the  35 Roberts case.  36 Roberts was a case concerning the jurisdiction of  37 the federal court.  At issue, inter alia, was whether  38 the common law of aboriginal title was "federal".  I  39 will explain it at this point, I'm speaking of the  40 Roberts case here strictly to the point of whether  41 91(24) comprehends lands reserved, common lands, as  42 opposed to statutory set aside lands, and then I will  43 return to Roberts on the point you adressed earlier,  44 Mr. Justice Lambert, on the question of what is  45 federal common law and how does it operate and so  46 forth.  So at this point I'm speaking of it in a  47 narrow sense, but it might help just to address what 2536  Reply by Mr. Paterson  1 the case was about to get a sense of why the issue  2 arose.  In that case two Indian bands on Vancouver  3 Island in the vicinity of Campbell River are suing  4 each other and both are suing the Crown in respect of  5 a reserve very close to Campbell River.  And there is  6 an allegation -- the allegations in the pleadings are  7 that the reserve was allocated to one of the bands, to  8 the defendant band, in 1888 by government through its  9 lawful process, and the plaintiff band is claiming  10 that it had aboriginal title to the land in question,  11 and the government was in breach of its fiduciary duty  12 to the band in alotting the land to the wrong band.  13 And so there's an issue of fiduciary duty based on the  14 common law of aboriginal title at that point.  And the  15 issue that arose in this judgment here, the federal  16 court, is whether that constituted the laws of Canada  17 within the meaning of Section 101 of the Constitution  18 Act so as the best jurisdiction in the federal court.  19 And Mr. Justice Hugesson, and on this point he was --  20 his reasons were adopted by both of the other judges,  21 said:  22  23 "The second source of applicable federal  24 law --"  25  26 The first source he found to be Indian Act provisions  27 after the allotment of the lands:  28  29 "The second source of applicable federal law is  30 the underlying aboriginal title which, on the  31 pleadings, must vest in either the plaintiff  32 band or the defendant band.  In the case of  33 Guerin, that title was variously described as a  34 "unique" or "sui generis" interest as "historic  35 reality" by Madam Justice Wilson.  As further  36 stated by Mr. Dickson J., the Indians' interest  37 in their lands:  38 '...is a pre-existing legal right not  39 created by Royal Proclamation.'"  40  41 And so forth:  42  43 "In the light of Secton 91(24) of the  44 Constitution Act, and of the Derrickson  45 decision, it cannot be seriously argued that  46 the law of aboriginal title is today anything  47 other than existing federal law. 2537  Reply by Mr. Paterson  1 With respect to the third criterion --"  2  3 That is the test for jurisdiction:  4  5 "-- it would equally seem to me to be beyond  6 question that both the Indian Act and the law  7 of aboriginal title are "laws of Canada" as  8 that phrase is used in Section 101 of the  9 Constitution Act."  10  11 This judgment was affirmed by the Supreme Court of  12 Canada by Wilson J., who confirmed that the law of  13 aboriginal title was federal common law.  And as I  14 mentioned before, I come to the implications of the  15 judgment below.  16 It is submitted that it is not open to this court  17 to find that lands which are subject to aboriginal  18 title are anything other than lands reserved for  19 Indians within the meaning of Section 91(24) of the  20 Constitution Act.  21 I wonder if this might be a good time to break.  22 TAGGART, J.A.:  Yes, five minutes.  23 THE REGISTRAR:  Order in court.  24  2 5 AFTERNOON RECESS  26  27 I hereby certify the foregoing to be  28 a true and accurate transcript of the  29 proceedings herein transcribed to the  30 best of my skill and ability  31  32  33  34  35 Graham D. Parker  36 Official Reporter  37 United Reporting Service Ltd.  38  39  40  41  42  43  44  45  46  47 2538  Reply by Mr. Paterson  1 (AFTERNOON RECESS)  2  3 THE REGISTRAR:  Order in court.  4 TAGGART, J.A.:  Yes, Mr. Paterson.  5 MR. PATERSON:  My Lords, I am at page 25 of my speaking notes.  6 And my submission here is that provincial  7 extinguishment is barred not only by the strict  8 division of powers under section 91(24), which I have  9 just spoken to, but as well by federal paramountcy.  10 And I will speak about this in two heads.  The first  11 is the statutory paramountcy and the second is common  12 law paramountcy.  13 In terms of statutory paramountcy, it is, of  14 course, commonplace that where federal and provincial  15 laws are in conflict, federal law prevails.  In the  16 present case I say that federal legislation, as well  17 as common law, have ousted any asserted provincial  18 power to extinguish aboriginal title.  19 We submit that Parliament has, in fact, legislated  20 with respect to the surrender requirements for  21 non-reserve Indian lands.  As noted before, and this  22 was referred to in the submissions of Ms. Mandell this  23 morning, Mr. Justice Davies who dissented on the  24 question of the power of the federal government to  25 bind the Province to an obligation to make treaty  26 payments, made the following comments in relation to  27 surrender matters in the Royalties case.  He said:  28  29 "The Dominion Parliament by its legislation of  30 1868, 131 Vict, and so on, prescribed the  31 manner in which the aboriginal title to lands  32 might be surrendered up or ceded.  I take it  33 that after this exercise of legislative power,  34 the Dominion and the Dominion alone could act  35 so as to extinguish the aboriginal title to any  36 lands within the Dominion.  37 The right and duty of determining when and  38 the terms on which such title ought to be  39 extinguished rests with the Dominion and with  40 it alone.  Considerations arising out of and  41 affecting the peace, order and good government  42 of Canada and other considerations affecting  43 the best interests of the Indians may well have  44 entered into the minds of that government when  45 determining the times and seasons at which it  46 was desirable or necessary to make such a  47 treaty as the one made before us." 2539  Reply by Mr. Paterson  1  2 That statute, I now refer to the passage in question  3 that provides at the top of page 26:  4  5 "No release or surrender of lands reserved for  6 the use of the Indians or of any tribe, band or  7 body of Indians, or of any individual Indian,  8 shall be valid or binding, except on the  9 following conditions ..."  10  11 And then it sets out surrender requirements and so  12 forth.  And I emphasize that it uses the language from  13 91(24) "lands reserved for the use of the Indians".  I  14 say that this language undoubtedly would have applied  15 to all of the lands within 91(24) jurisdiction,  16 including lands in issue in St. Catherine's Milling.  17 In later statute, there is an 1874 statute,  18 Parliament repealed portions of that 1868 statute and  19 then applied the Act to British Columbia and to  20 Manitoba, as I recall, in the following terms:  21  22 "Upon, from and after the passing of this Act,  23 the Acts and portions of Acts hereinafter  24 mentioned of the Parliament of Canada shall be  25 and are hereby extended to and shall be in  26 force in the Provinces of Manitoba and of  27 British Columbia; and all the enactments and  28 laws theretofore in force in the said  29 Provinces, inconsistent with the said Acts, or  30 making any provision in any matter provided for  31 by the said Acts, other than such as is made by  32 the said Acts, shall be repealed on and after  33 the passing of this Act."  34  35 Section 10(1) of the foregoing 1874 Act expressly  36 extended sections 6 to 25 of the 1868 Act of B.C.  37 That is including s. 8 that I referred to you at the  38 top of the page.  39 By and after 1876 the "reserves" to which the  40 surrender provisions of the Indian Act applied was a  41 narrower group of lands, than those protected by s. 8  42 of the 1868 Act.  That Act would, however, that is the  43 1868 Act would continue to apply to non-reserve Indian  44 lands the aboriginal title to which had not been  45 extinguished.  That, I take it, is what Mr. Justice  46 Davies was referred to at that point.  47 Further evidence that it was Parliament's 2540  Reply by Mr. Paterson  1 intention to legislate with respect to non-reserve  2 Indian lands can be found in the Public Lands Act of  3 the Dominion, s. 24 of 1871, section 42 which  4 provided:  5  6 "None of the provisions of this Act respecting  7 the settlement of agricultural lands, or the  8 lease of Timber lands, or the purchase and sale  9 of Mineral lands, shall be held to apply to  10 territory the aboriginal title to which shall  11 not at the time have been extinguished."  12  13 It is important to recall that when this  14 legislation was passed, Parliament had legislative and  15 administrative jurisdiction over all Royal  16 Proclamation.  And I referred to that earlier.  17 It is submitted that Parliament has evidenced  18 through statutes its exclusive jurisdiction to  19 legislate with respect to the federal power to accept  20 surrenders over reserve and non-reserved lands.  It is  21 beyond the constitutional competence of the Province  22 to otherwise extinguish Indian title.  The  23 constitutional constraint can be demonstrated by  24 posing the question of whether the Province could  25 competently accept a surrender of an Indian reserve.  26 The answer is clearly no.  Equally, the Province has  27 no competence to extinguish title for lands not  28 formally designated as reserves.  29 I now turn to the question of common law  30 aboriginal title.  And I would like to commence by  31 addressing its substance and then I will go to its  32 effect.  And the substance I am going to say -- I am  33 going to want to start with the Guerin decision.  It  34 is submitted that Guerin holds that lands subject to  35 aboriginal title are no less lands reserved for the  36 Indians than statutory Indian reserves and no less  37 well protected from provincial extinguishment.  The  38 ratio of Guerin, to the contrary, is that the rights  39 of aboriginal peoples to and in respect of the lands  40 within statutory Indian reserves are no less  41 substantial than their rights to lands subject to  42 unextinguished Indian title.  This holding is binding  43 upon this Court and precludes a limitation of the  44 section 91(24) jurisdiction to statutory reserves as  45 the Province would urge.  4 6 In the judgment under appeal, the trial judge  47 recited the following passage from Guerin, which I 2541  Reply by Mr. Paterson  1 would like to read.  You have seen it before.  2  3 "That principle supports the assumption  4 implicit in Calder that Indian title is an  5 independent legal right which, although  6 recognized by the Royal Proclamation of 1763,  7 nevertheless predates it...  8 It does not matter, in my opinion, that the  9 present case is concerned with the interest of  10 an Indian Band in a reserve rather than with  11 recognized aboriginal title in traditional  12 tribal lands.  The Indian interest in the land  13 is the same in both cases.  It is worth noting,  14 however, that the reserve in question here was  15 created out of the ancient tribal territory of  16 the Musqueam Band by the unilateral action of  17 the Colony of British Columbia, prior to  18 Confederation."  19  20 The trial judge then considered a further passage  21 from this judgment, that the Indians have a legal  22 right to occupy and possess "certain lands" which he  23 took to be reserve lands because the lands in issue in  24 that litigation were reserve lands and because all of  25 the cases relied upon except for Calder concerned  26 reserves.  He concluded that Guerin was not a case  27 about common law aboriginal interests, but rather  28 about a breach of fiduciary duty relating to reserve  29 lands.  30 Finally, the trial judge concluded that the quoted  31 passage meant simply that:  32  33 "...the principles dealing with breaches of  34 duties owing to aboriginals would be the same  35 whether the lands in question were reserve  36 lands or other lands charged with  37 unextinguished aboriginal rights."  38  39 With respect, this is a far cry from the passage  4 0 quoted:  41  42 "The Indian interest in the land is the same in  43 both cases."  44  45 We submit that there is more significance than the  46 trial judge accepted to the Court's reliance upon  47 Calder, and that the reasoning of the Guerin decision 2542  Reply by Mr. Paterson  1 was directed to common law aboriginal title and merely  2 applied, by extension, to reserve lands.  3 The view expressed by the trial judge is carried  4 further in the Province's Revised Factum.  There the  5 Province refers to the passage that I cited before,  6 "the interest is the same" and so forth, and says:  7  8 "...this comment cannot be taken to extend the  9 scope of section 91(24) to cover unrecognized  10 Aboriginal title in traditional tribal lands.  11 In equating the Aboriginal interest in tribal  12 lands with the Aboriginal interest in reserve  13 land, Dickson J. was rebutting an inference  14 that fiduciary obligations were only owed to  15 Aboriginal people upon surrender of reserve  16 lands and not upon surrender of traditional  17 lands."  18  19 This conclusion is utterly unsupportable.  There  20 is no conceivable reason, in our submission, why Mr.  21 Justice Dickson would want to rebut a matter that was  22 not in issue and that did not arise in the case.  23 Further, it runs precisely contrary, we submit, to the  24 reasoning of that judgment.  25 The issue before the Supreme Court, as placed by  26 the parties, was whether or not the Crown was liable  27 for a breach of trust said to have been founded on the  28 terms of section 18(1) of the Indian Act, the formal  29 surrender instrument, or oral qualifications to the  30 terms of the surrender instrument.  No question arose  31 before the Court as to whether there was a fiduciary  32 duty which might not apply to "traditional" lands.  33 Now I would like to turn to the Guerin decision  34 itself.  And you will find it at tab 92 of this  35 reference book.  Tab 2 is printed on the front cover.  36 It is submitted that the passage that I referred to  37 from Guerin is the ratio of the decision, and that it  38 is binding on the court, that it assigns the highest  39 interest in Indian lands to traditional lands, not to  40 reserves.  Characterizing Guerin as a case about  41 reserve lands is the equivalent to characterizing  42 St. Catherine's Milling as a case only about trees.  43 I turn you to page 330 of the Guerin decision at  44 tab 92.  45 HUTCHEON, J.A.: Mr. Paterson, I am not sure where we are at.  4 6 You've got a heading "Common Law". But what is the  47 point being made under this heading? 2543  Reply by Mr. Paterson  1 MR. PATERSON:  I am making -- I am attempting to address the  2 question of substantively what the common law interest  3 is through looking at the Guerin case and then address  4 the question of its paramountcy through Roberts.  5 HUTCHEON, J.A.:  Oh, I see.  6 MR. PATERSON:  And other cases.  So this is leading into an  7 analysis of the implication of the Roberts decision --  8 HUTCHEON, J.A.:  I see.  9 MR. PATERSON:  -- defining federal common law of aboriginal  10 title.  11 At page 330 near the bottom Mr. Justice Dickson  12 started -- conducted a review of the judgment at  13 trial.  And what I am going to do here, I am just  14 going to go through portions of the judgment very  15 specifically because I want to address quite  16 specifically the reasoning that I think underlies this  17 decision.  Dickson J. points out at the bottom of page  18 330:  19  20 "The plaintiffs based their case on breach of  21 trust.  They asserted the federal Crown was a  22 trustee of the surrendered lands.  The trial  23 judge agreed."  24  25 Following over:  26  27 "The Crown attempted to argue that if there was  28 a trust it was, at best, a 'political trust',  29 enforceable only in Parliament and not a 'true  30 trust', enforceable in the courts."  31  32 And then he refers to leading English cases defining  33 what a true trust is.  Further down the page it refers  34 to the fact that the Province or the government  35 refused to amend its pleading to allege a political  36 trust and Judge Collier refused to consider the point  37 further in his reasons.  "The Crown then argue", and I  38 am at the middle of page 331:  39  40 "...that if there were a legally enforceable  41 trust its terms were those set out in the  42 surrender document..."  43  4 4 And then further down:  45  46 "The trial judge rejected these submissions.  47 He held that the Crown can, if it chooses, act 2544  Reply by Mr. Paterson  1 as a trustee."  2  3 And that the terms, oral terms known to the Crown,  4 were binding against it.  Turning over to page 332,  5 Justice Dickson then turned to the decision of the  6 Federal Court of Appeal.  And the Federal Court of  7 Appeal reversed the trial judge.  And at that point he  8 says:  9  10 "The Federal Court of Appeal, speaking through  11 Mr. Justice Le Dain, proceeded on the premise  12 that the case presented on behalf of the band  13 rested on the existence of a statutory trust in  14 the private law sense based primarily on the  15 terms of section 18(1) of the Indian Act."  16  17 And then he refers to 18(1).  And then he says:  18  19 "Mr. Justice Le Dain scrutinized this section  20 and concluded that it was not consistent with a  21 'true trust' in the sense of an equitable  22 obligation enforceable in a court of law. "  23  24 So we have the issue emerging here as to whether this  25 is a true trust in a private law sense, or whether  26 this is what generally might be called a statutory or  27 political trust setting out a political obligation of  28 the government for which Parliament is responsible but  29 which is not a justiciable obligation that can arise  30 for liability in the courts.  And the conclusion Mr.  31 Justice Le Dain, as set out, was that he found it was  32 not a true trust.  33 Carrying over on to 333 then:  34  35 Mr. Justice Le Dain also rejected the  36 alternative contention on behalf of the band  37 that a trust was created by the terms of the  38 surrender document."  39  40 That was out.  And then below he also rejected the  41 conclusions of the trial judge that if it had been  42 then it would have been limited by the oral terms.  43 At this point in the judgment, having set out what  44 happened in the courts below, Mr. Justice Dickson then  45 turns to the question of the fiduciary relationship of  46 the Crown to Indian peoples at page 334 based on --  47 based on the nature of aboriginal title.  And for some 2545  Reply by Mr. Paterson  1 reason my sideline marking hasn't -- the system broke  2 down on these two pages, so I will direct you to the  3 passages that I wanted to refer to.  The first is in  4 the middle of the page, the paragraph beginning "In my  5 view".  6  7 "In my view, the nature of Indian title and the  8 framework of the statutory scheme established  9 for disposing of Indian land places upon the  10 Crown an equitable obligation, enforceable by  11 the courts, to deal with the land for the  12 benefit of the Indians.  This obligation does  13 not amount to a trust in the private law sense.  14 It is rather a fiduciary duty."  15  16 This is the first that fiduciary duty has come up in  17 any of the judgments below.  18  19 "If, however, the Crown breaches this fiduciary  20 duty it will be liable to the Indians in the  21 same way and to the same extent as if such a  22 trust were in effect.  23 The fiduciary relationship between the  24 Crown and the Indians has its roots in the  25 concept of aboriginal, native or Indian title.  26 The fact that Indian bands have a certain  27 interest in lands does not, however, in itself  28 give rise to a fiduciary relationship between  29 the Indians and the Crown.  The conclusion that  30 the Crown is a fiduciary depends upon the  31 further proposition that Indian interest in the  32 land is inalienable except upon surrender to  33 the Crown."  34  35 Now, it is important to emphasize the language  36 that:  37  38 "The fiduciary relationship between the Crown  39 and the Indians has its root in the concept of  40 aboriginal, native or Indian title."  41  42 The root of the obligation that had been submitted in  43 both courts below that had been the subject of  44 submissions by counsel and findings by the court was a  45 trust based upon the language of section 18(1) of the  46 Indian Act, or of the formal surrender instrument, or  47 of oral terms of the surrender.  And Mr. Justice 2546  Reply by Mr. Paterson  1 Dickson here is saying that "it has its roots in the  2 concept of aboriginal, native or Indian title".  3 At three lines from the bottom of the page, just  4 after the words "Indian Act" in italics:  5  6 "The surrender requirement, and the  7 responsibility it entails, are the source of a  8 distinct fiduciary obligation owed by the Crown  9 to the Indians.  In order to explore the  10 character of this obligation, however, it is  11 first necessary to consider the basis of  12 aboriginal title and the nature of the interest  13 in land which it represents."  14  15 Now, this case, strictly speaking, is, of course,  16 a case concerning lands surrendered from an Indian  17 reserve.  But that is not the method of reasoning that  18 is adopted here.  What Chief Justice Dickson does is  19 he goes right to the nature of the aboriginal title,  20 and then he goes into the existence of aboriginal  21 title.  22 At the middle of the main paragraph the line  23 begins with "Indian lands", the first main paragraph.  2 4  WALLACE, J.A.:  What page?  25  MR. PATERSON:  I am on 335, I'm sorry.  26  27 "Judson and Hall JJ. were in agreement,  28 however, that the aboriginal title existed in  29 Canada (at least where it has not been  30 extinguished by appropriate legislative action)  31 independently of the Royal Proclamation of  32 1763."  33  34 And then he recites their discussion in there.  And  35 carry on after the quote:  36  37 "In recognizing that the Proclamation is not  38 the sole source of Indian title the Calder  39 decision went beyond the judgment of the Privy  40 Council in St. Catherine's Milling & Lumber Co.  41 In that case Lord Watson acknowledged the  42 existence of aboriginal title but said it had  43 its origin in the Royal Proclamation.  In this  44 respect Calder is consistent with the position  45 of Chief Justice Marshall in the leading  46 American cases, and so forth."  47 2547  Reply by Mr. Paterson  1 Turning over the page to 336, Mr. Justice Dickson  2 quotes at length from the Marshall decision in Johnson  3 v. Mcintosh.  And then after that quote I pick up  4 after that quote.  He says:  5  6 "The principle that a change in sovereignty  7 over a particular territory does not in general  8 affect the presumptive title of the inhabitants  9 was approved by the Privy Council in Amodu  10 Tijani.  That principle supports the assumption  11 implicit in Calder that Indian title is an  12 independent legal right which, although  13 recognized by the Royal Proclamation of 1763,  14 none the less predates it."  15  16 He carries on.  And at this point he then addresses  17 the political trust reasoning which was rejected --  18 which was rejected by Mr. Justice Le Dain in the Court  19 of Appeal.  20  21 "For this reason,"  22  23 that is because it is pre-existing, an independent  24 pre-existing rite.  25  26 "For this reason Kinloch and Tito v. Waddell,  27 and the other 'political trust' decisions are  28 inapplicable to the present case.  The  29 'political trust' cases concerned essentially  30 the distribution of public funds or other  31 property held by the government.  In each case  32 the party claiming to be beneficiary under a  33 trust depended entirely on statute, ordinance  34 or treaty as the basis for its claim to an  35 interest in the funds in question.  The  36 situation of the Indians is entirely different.  37 Their interest in their lands is a pre-existing  38 legal right not created by Royal Proclamation,  39 by section 18(1) of the Indian Act, or by any  40 other executive order or legislative  41 provision."  42  43 And I will stop at that point and say, and I am now at  44 paragraph 98 of my submission, My Lords.  I am going  45 to keep going through this judgment at this page.  To  46 this point what I say is Mr. Justice Dickson has  47 rejected the analysis that the obligation of the Crown 2548  Reply by Mr. Paterson  1 identified in section 18 in the Indian Act, arising  2 from the creation of Indian reserves and the statutory  3 regime surrounding those reserves gave rise, at most,  4 to a political trust.  He identified that the fallacy  5 behind that analysis is that in political trust cases,  6 the obligation of the Crown is in relation to a right  7 or interest of the Crown's own creation.  In contrast,  8 the Indian interest in their lands is a pre-existing  9 one, predating any Crown action including the Royal  10 Proclamation.  11 It is submitted that this finding is fundamental  12 to the decision in Guerin.  Absent a finding of a  13 pre-existing aboriginal right being corrected but not  14 created by statute, the conclusion of Mr. Justice Le  15 Dain that lands in those reserves were subject to a  16 political trust would have been inescapable.  In other  17 words, the fiduciary relationship founded in common  18 law aboriginal title to traditional lands persisted  19 despite those lands subsequently being incorporated  20 into statutory reserves.  The latter created no  21 different interest, but preserved a pre-existing one.  22 And you may just follow this from the notes  23 because I quote the passage here.  The passage from  24 Dickson J. continues:  25  26 "It does not matter, in my opinion, that the  27 present case is concerned with the interest of  28 an Indian band in a reserve rather than  29 unrecognized aboriginal title in traditional  30 tribal lands.  The Indian interest in the land  31 is the same in both cases."  32  33 This goes to the heart, I submit, of the  34 'political trust' analysis.  Mr. Justice Le Dain found  35 the reserves to have been creations of the Crown and  36 therefore only subject to a political trust.  Mr.  37 Justice Dickson, on the contrary, found that they were  38 referable back to their pre-existing origins and hence  39 are not subject to the limits of a Crown-created  40 interest.  The continuation of Mr. Justice Dickson's  41 passage confirms this:  42  43 "It is worth noting, however, that the reserve  44 in question here was created out of the ancient  45 tribal territory of the Musqueam band by the  46 unilateral action of the colony of British  47 Columbia, prior to Confederation." 2549  Reply by Mr. Paterson  1  2 It is implied in this sentence that the ability of  3 the Musqueam, in particular, to avoid the  4 vulnerabilities of the 'political trust' doctrine  5 being applied to their reserve, and to claim the  6 benefit of the fiduciary duty which was the basis for  7 liability in that case, was enhanced by the fact that  8 the specific reserve lands in issue were created out  9 of the traditional common law territory.  10 Now, that leaves open the question --  11 TAGGART, J.A.:  That was invariably the case, of course, in that  12 case.  Surely, it is simply a method of dealing with  13 the concept of Mr. Justice Le Dain and the Court of  14 Appeal based upon a political trust.  Surely this  15 language employed by Mr. Justice Dickson does not  16 carry the implication that the non-reserve lands,  17 which may have been a part of the traditional lands of  18 the Musqueam, carry with it the same requirements as  19 those carried by reserved lands in terms of the  20 necessity to surrender to Canada, who in turn can  21 enter into leases and so on on behalf of the Indians.  22 Nor does it seem to me this is authority.  He says  23 that the interest in the lands formerly those of  24 the -- before the advent of Europeans, formerly those  25 of the Musqueam band, and so all are the same, surely  26 what he is saying there is that the Indians' interest  27 in those lands enjoyed by the Musqueam band before the  28 advent of the Europeans, before sovereignty, if you  29 wish, was the same.  And that is to say that the band  30 as a whole enjoyed the use and occupation, and I  31 suppose, in concept, the ownership of those lands.  32 That is to say they excluded others from those lands,  33 and I presume customarily did, usually by warfare.  34 With the advent of Crown sovereignty, however, the  35 Crown then, of course, a unitary Crown and not a  36 duplicate Crown as we have now, the Crown title, by  37 virtue of the theory of the Europeans, became the  38 paramount type, but overlaying by the interest of the  39 Indians in those lands.  40 But that's surely all that Mr. Justice Dickson is  41 saying that that overlayed interest of the Indians in  42 those lands is the same on the reserve, or where you  43 can show it, as the Appellants have sought to do in  44 this case, a use and occupation of contiguous lands  45 which are not reserve lands, but we have as we have  4 6 become accustomed to call them, Crown lands  47 unoccupied.  Isn't that the sum of what Mr. Justice 2550  Reply by Mr. Paterson  1 Dickson was saying there?  2 MR. PATERSON:  I think, Mr. Justice Taggart, that that decision  3 has often been read that way.  I think that reading of  4 it is incorrect.  I think that if you follow the  5 context of where that sentence comes from, if you  6 follow the flow of the argument so that he says:  Is  7 there a duty?  Where does this duty come from?  It  8 comes from the common law.  And he pursues it all  9 along up to finding the fiduciary duty.  And then he  10 says it doesn't matter that these lands are in  11 reserve, the interest is the same in any case.  And I  12 say that's exactly what he is saying.  13 And I say in respect of the question as to whether  14 a surrender of common law aboriginal titles to the  15 Crown, to the federal Crown is necessary, I say the  16 implication of that is, yes, it is necessary.  And I  17 say not only is it necessary, I say it's been the  18 practice in Canada virtually everywhere except British  19 Columbia where at Confederation the unsurrendered  20 Indian lands, the Royal Proclamation lands were 91(24)  21 lands within the provinces.  Treaties were signed as  22 Canada expanded west.  And it even kept control of  23 property, allowing those treaties to be signed,  24 including in northern British Columbia.  Treaty  25 process signing is underway right now through much of  26 the northern territories.  In fact, through all of  27 them there are negotiations in progress.  British  28 Columbia is an absolute exception.  29 And what Mr. Justice Dickson is saying here  30 doesn't have those kind of startling implications  31 anywhere in Canada except here.  And we have a problem  32 here.  But I think that if you examine the reasoning  33 here, I think the reasoning of this judgment, and  34 ultimately it is not my interpretation that counts, of  35 course, but my submission is the reasoning of this  36 judgment is that the Court in assessing the liability  37 of the Crown for breach of fiduciary obligation in  38 respect of the disposition of lands that were  39 surrendered to it immediately went to examine what was  40 the common law interest, and held that the foundation  41 of liability was that the very interest in issue was  42 not a creation of the Crown, that is a reserve, it was  43 a pre-existing interest.  And I think that Guerin  44 can't be understood otherwise than saying that.  45 TAGGART, J.A.:  Well, I think it would be a most extraordinary  46 thing -- was the Province represented in these  47 proceedings? 2551  Reply by Mr. Paterson  1  2  3  4  5  6  7  8  9  10  11  12  13  14  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  46  47  MR. PATERSON  TAGGART, J. A  MR. PATERSON  TAGGART, J. A  MR. PATERSON  TAGGART, J. A  MR. PATERSON  TAGGART, J. A  MR.  In Guerin?  In Guerin?  I am told they were.  And who acted for them?  I'm sorry, I don't --  I don't see a name anywhere here.  No.  I'm sorry.  I gather they weren't.  I would find it most extraordinary if Mr.  Justice Dickson would deal in this fashion with the  issue of the Province's interest under section 109 of  the Constitution Act without the Province having had  something to say about it.  It simply doesn't ring  true.  It seems to me that, as I say, his whole  proposition here is devoted to disposing of the  concept of Mr. Justice Le Dain of a --what did you  call it, a statutory trust, or something equivalent to  it.  And he does that by way of pointing out that  prior to the advent of sovereignty, all of these lands  were occupied by the Musqueam band.  After the  assertion of sovereignty they continued to be occupied  by the Musqueam band, as is the case of most Indian  lands in British Columbia.  The title of the Crown was paramount, but it was  overlayed by the aboriginal interest of the Indians in  those lands.  The reserve lands in that sense, and in  that limited sense, are no different in that respect  than the surrounding lands.  And in this case, of  course, and this is a very good example of that  because here the plaintiffs a fortiori say:  We  certainly have a clear interest in the reserve lands,  and only Canada can deal with that under the  provisions of the Indian Act, but we have also an  interest in the surrounding land.  And those interests  are the ones that we seek relief in respect of.  PATERSON:  Well, my submission in relation to that is simply  that I don't think you can find anything in the  judgment in Guerin which turns on the fact that the  lands were reserved lands.  And I think that Mr.  Justice Dickson went out of his way to say that  precisely.  And I think, and I will come to it further  down in my argument, that when Mr. Justice Dickson  re-visited the consequence of Guerin in Sparrow, when  he referred to the Guerin decision in Sparrow, and I  will come to that in due course, he confirmed that  this was, in fact, the view that was put forward in  Guerin and that this was the implication in Guerin. 2552  Reply by Mr. Paterson  1 And so I will come to that.  2 My lord, I might just so I can identify it just  3 for your assistance the passage on Sparrow I will rely  4 on.  It is at page 41 of my speaking notes.  And I  5 will discuss it in the context when I get to it.  6 TAGGART, J.A:  Come to it in the context in which you wish to.  7 MR. PATERSON:  When he talked about:  8  9 "Section 35(1) [of the Constitution Act, 1982],  10 at the least, provides a solid constitutional  11 base upon which subsequent negotiations can  12 take place.  It also affords aboriginal peoples  13 constitutional protection against provincial  14 legislative power.  We are, of course, aware  15 that this would, in any event, flow from the  16 Guerin case, but for a proper understanding of  17 the situation..."  18  19 And this is after he has discussed the process of  20 constitutional negotiations and so on.  He says:  21  22 "It is essential to remember that Guerin was  23 decided after the enactment of the  24 Constitution Act."  25  26 I take that to mean, among other things, that had  27 Guerin been decided before 1982, in fact, s. 35 would  28 not have been necessary in order to afford aboriginal  29 peoples constitutional protection against provincial  30 legislative power.  That this would, in any event,  31 flow from the Guerin case.  So as I say, I will come  32 to that in due course.  But my reading is that in fact  33 Mr. Justice Dickson not only addressed the question of  34 Guerin but reiterated the point in Sparrow.  And it is  35 worth noting that the Province was represented in  36 Sparrow in the proceedings as an intervenor, my lord.  37 Returning to paragraph 103, there is just one  38 further passage that I want to refer you to in  39 Sparrow.  I'm sorry, in Guerin.  And this is  40 concluding the analysis.  And it is in his analysis of  41 the fiduciary duty and liability of the Crown.  And  42 again Mr. Justice Dickson said:  43  44 "It should be noted that fiduciary duties arise  45 only with regard to obligations originating in  46 a private law context.  Public law duties, the  47 performance of which requires the exercise of 2553  Reply by Mr. Paterson  1 discretion, do not typically give rise to  2 fiduciary relationship."  3  4 That is the statutory duties and so forth.  5  6 "As the 'political trust' cases indicate, the  7 Crown is not normally viewed as a fiduciary in  8 the exercise of its legislative or  9 administrative function.  The mere fact,  10 however, that it is the Crown which is  11 obligated to act on the Indians' behalf does  12 not of itself remove the Crown's obligation  13 from the scope of the fiduciary principle.  As  14 was pointed out earlier, the Indians' interest  15 in land is an independent legal interest.  It  16 is not a creation of either the legislative or  17 executive branches of government.  The Crown's  18 obligation to the Indians with respect to that  19 interest is therefore not a public law duty.  20 While it is not a private law duty in the  21 strict sense either, it is none the less in the  22 nature of a private law duty.  Therefore, in  23 this sui generis relationship, it is not  24 improper to regard the Crown as fiduciary."  25  26 It is my submission that the decision of Mr.  27 Justice Dickson to go straight to the underlying  28 aboriginal right as the foundation for the fiduciary  29 duty, and to incorporate this right into and apply it  30 to reserve lands thus avoiding the consequences of the  31 political trust doctrine.  And just for your  32 assistance, I won't take you through this, but I note  33 at paragraph 95 that I set out the pages on which the  34 federal government analysis of political trust and so  35 forth is set out.  And I have included those in the  36 binder.  And, my lord, the decision to incorporate  37 this right into reserve lands thus avoiding the  38 consequence of a political trust doctrine is  39 fundamental to the reasoning of the judgment.  40 Contrary to the conclusions of the trial judge and  41 the submissions of the province in this appeal, Guerin  42 stands, we submit, for the proposition that statutory  43 reserves, at least those created from the traditional  44 territories of the band to whom they are allotted, and  45 that will be most of them, are protected by the same  46 fiduciary duty that attaches to lands subject to  47 unextinguished aboriginal title.  The corollary is 2554  Reply by Mr. Paterson  1 that traditional lands incorporated into reserves do  2 not thereby become vulnerable to the 'political trust'  3 analysis which would destroy the basis for liability  4 of the Crown.  5 Roberts case determined that the law of aboriginal  6 title, from which flows both the entitlement of the  7 Indians and the fiduciary duty of the Crown, is a  8 matter of federal common law.  Excuse me for a moment.  9 This determination complements the finding of Mr.  10 Justice Dickson in Guerin that the rights of Indians  11 to reserve lands did not differ from their rights to  12 lands held by reason of aboriginal title.  13 The significance of the Roberts decision can be  14 seen by the following results which, it is submitted,  15 must flow from such a finding.  First, lands, the  16 aboriginal title to which was not extinguished prior  17 to confederation are "lands reserved for the Indians"  18 within the meaning of section 91(24) of the  19 Constitution Act except to the extent that such Indian  20 interest was formally surrendered to or expropriated  21 by the federal Crown.  And 2 --  22 HUTCHEON, J.A.:  Sorry, I don't quite -- is this what you submit  23 is the result of Roberts?  24 MR. PATERSON:  I am saying this follows from Roberts.  And then  25 I will go into -- I am summarizing the points that I  26 am going to make, my lord.  And, second, that federal  27 common law of aboriginal title "occupies the field" of  28 law concerning, protecting, asserting, interfering  29 with or extinguishing aboriginal title, subject only  30 to being altered, amended or repealed by Parliament.  31 And in respect of the question interfering with,  32 just to be clear, that has, in fact, been interfered  33 or been altered by Parliament through the enactment of  34 section 88.  And that is a vehicle which has been  35 discussed in Dick and others which allows the  36 Province, in fact, in certain cases to move into  37 territories to which otherwise they might not be able  3 8 to move.  39 The Roberts case was, in its relevant facts, an  40 action in trespass or ejectment by one Indian band  41 against another.  The trespass was alleged to have  42 occurred on an Indian reserve.  I have gone through  43 the facts, in any event.  The jurisdiction of the  44 Federal Court was challenged on the basis that a civil  45 trespass action was simply a matter of the common law  46 of the Province, notwithstanding that the federal  47 government had jurisdiction to legislate in respect of 2555  Reply by Mr. Paterson  1 trespass on Indian reserves if it so chose.  Now,  2 there is legislation on trespass in Indian reserves in  3 the Indian Act, but it only concerns trespass by  4 non-Indians.  And so in the incident case there is no  5 provision under the Indian Act governing it.  6 The Defendant Band argued, therefore, that there  7 was no body of federal law underpinning the claim to  8 support the jurisdiction of the Federal Court.  9 For the Supreme Court Madam Justice Wilson said:  10  11 "Professor Evans may be right that the Quebec  12 North Shore..."  13  14 Actually, I would like to take you to the passage  15 because I will read a bit more of it there.  And that  16 is at tab 110.  It is the highlighted portion at 110.  17 And I will read the discussion concerning federal  18 common law.  19 LAMBERT, J.A.:  Has Roberts found its way into our book of  20 authorities?  21 MR. PATERSON:  Yes.  And it would be at.  22 TAGGART, J.A.:  It is supposed to be at A 65, but it isn't.  23 MR. PATERSON:  A 65, tab 7 is the reference that I have here.  24 TAGGART, J.A.:  I looked at one citation that was given for me  25 and it is not in that log.  26 MR. PATERSON:  It is at tab 68, my lord, of volume 65.  27 LAMBERT, J.A.:  Thank you.  28 MR. PATERSON:  The passages that I was going to refer to is at  29 339.  It is at tab 110 of the book accompanying these  30 notes.  And Madam Justice Wilson goes through a  31 discussion about Federal Court jurisdiction which is  32 all very esoteric.  And it comes down to the point in  33 issues here "Commenting on Quebec North Shore", I am  34 halfway down on page 339:  35  36 "Commenting on on Quebec North Shore and  37 McNamara Construction, Professor Evans  38 observes:  39 'The thrust of Quebec North Shore and  40 McNamara Construction was to deny, in  41 general terms, the existence of a body of  42 federal common law that was co-extensive  43 with the unexercised constitutional  44 legislative competence of Parliament over  45 matters assigned to it.  Thus a law will  46 normally only be a law of Canada for the  47 purpose of section 101 of the British North 2556  Reply by Mr. Paterson  1 America Act if it is enacted by or under  2 federal legislation'."  3  4 Now, I will just stop.  That, parenthetically, was the  5 general view of the effect of Quebec North Shore and  6 McNamara Construction.  I will submit further on that  7 that was an incorrect view and that it misconceives  8 what those cases -- how those cases operated.  But in  9 any event, the general proposition was that there was  10 no federal common law.  And then Madam Justice Wilson  11 goes on to say:  12  13 "If Professor Evans is a saying in the  14 above-quoted paragraph that only federal  15 legislation can meet the description of a 'law  16 of Canada' within the meaning of s. 101, I  17 think he must be wrong since Laskin C.J.  18 clearly includes 'common law' as existing  19 federal law inasmuch as he says that the cause  20 of action must be founded 'on some existing  21 federal law, whether statute or regulation or  22 common law'.  Professor Evans may be right that  23 Quebec North Shore and McNamara Construction  24 deny the existence of a federal body of common  25 law co-extensive with the federal legislature's  26 unexercised legislative jurisdiction over the  27 subject matters assigned to it.  However, I  28 think that the existence of 'federal common  29 law' in some areas is expressly recognized by  30 Laskin C.J. and the question for us, therefore,  31 is whether the law of aboriginal title is  32 federal common law.  33 I believe that it is.  In Calder this court  34 recognized aboriginal title as a legal right  35 derived from the Indians' historic occupation  36 and possession of their tribal lands.  As Mr.  37 Justice Dickson pointed out in Guerin,  38 aboriginal title pre-dated colonization by the  39 British and survived British claims of  40 sovereignty.  The Indians' right of occupation  41 and possession continued as a 'burden on the  42 radical or final title of the Sovereign'.  43 While, as was made clear in Guerin, s. 18 of  44 the Indian Act did not create the unique  45 relationship between the Crown and the Indians,  46 it certainly incorporated it into federal law  47 by affirming that 'reserves are held by Her 2557  Reply by Mr. Paterson  1 Majesty for the use and benefit of the  2 respective bands for which they were set  3 apart'.  4 I would conclude therefore that the 'laws  5 of Canada' are exclusively required for the  6 disposition of this appeal, namely the relevant  7 provisions of the Indian Act, the act of the  8 federal executive pursuant to the Indian Act in  9 setting aside the reserve in issue for the use  10 and occcupancy of one or other of the two  11 claimant Bands, and the common law of  12 aboriginal title which underlies the fiduciary  13 obligations of Crown to both Bands.  The  14 remaining two elements of the test set out in  15 ITO, are accordingly satisfied."  16  17 Madam Justice Wilson did not, in the Roberts decision,  18 address the substantive implications of a  19 determination that the law of aboriginal title was  20 common law.  This -- the question of common law, I  21 won't say that particular matter, but the question of  22 common law, the federal common law has been addressed  23 in other decisions.  And I want to refer to them now.  24 Well, I guess I can get started on this.  The  25 Supreme Court of Canada has repeated held that federal  2 6 common law is not simply common law applied within  27 areas of unexercised federal legislative competence.  28 And we respectfully adopt the passage from the  29 Holmes decision of this court in which the court held  30 that the above decisions, that is Quebec North Shore  31 Paper and McNamara Construction, I won't take you  32 through those cases at the moment, "to the extent that  33 they might be thought to deny the existence of federal  34 common law, must be regard as explained by the Roberts  35 case".  We submit, however, that these decisions are  36 entirely consistent with Roberts and were in no way  37 overruled by it.  In other words, in the omitted -- in  38 the omission there is a suggestion they might have  39 been overruled by Roberts.  And we say that is not the  40 case.  41 In Quebec North Shore Paper, Chief Justice Laskin  42 referred to the Federal Court jurisdiction being  43 founded on "applicable and existing federal law,  44 whether under statute or regulation or common law, as  45 in the case of the Crown".  The example of federal  46 common law he explained as follows:  47 2558  Reply by Mr. Paterson  1 "It should be recalled that the law respecting  2 the Crown came into Canada as part of the  3 public or constitutional law of Great Britain,  4 and there can be no pretense that that law is  5 provincial law.  In so far as there is a common  6 law associated with the Crown's position as a  7 litigant it is federal law in relation to the  8 Crown in right of Canada, just as it is  9 provincial law in relation to the Crown in  10 right of a Province, and is subject to  11 modification in each case by the competent  12 Parliament or Legislature."  13  14 The Supreme Court, however, rejected the view that  15 there were respectively federal and provincial 'common  16 laws' of contract depending on the context or the  17 subject matter of the contract.  Chief Justice Laskin  18 considered and rejected the proposition that  19 provincial laws of contract could be "enacted, amended  20 or repealed" by federal legislation with respect to  21 matters within federal jurisdiction, thus rendering it  22 federal under the provisions of section 129 of the  23 Constitution Act.  The Chief Justice held that while  24 Parliament could indeed legislate in the field, it  25 would not be amending or repealing provincial laws,  26 which applied of their own force in the absence of  27 federal legislation to the contrary.  28 In Associated Metals Chief Justice Jackett  29 discussed the nature of federal common law and  30 determined that common law was federal where that law,  31 continued by section 129 of the Constitution Act,  32 could be repealed, abolished, or altered by the  33 Parliament of Canada.  By his definition, federal  34 common law would be limited to matters which were  35 completely beyond the jurisdiction of the provincial  36 legislatures.  37 This view was cited with approval by the Supreme  38 Court in ITO v. Miida.  And I would now like to turn  39 you to the Associated Metals case.  And that will be  40 at tab 116 of the book accompanying the speaking  41 notes.  42 MACFARLANE, J.A.:  Do you want to do this today or tomorrow?  43 MR. PATERSON:  It is quite a lengthy passage.  44 TAGGART, J.A.:  We are at adjournment time.  Perhaps we can do  45 that tomorrow.  46 MR. PATERSON:  That might be better, my lord.  10 o'clock.  47 THE REGISTRAR:  Order in court.  This court stands adjourned 2559  Reply by Mr. Paterson  1 until 10 o'clock tomorrow.  2 (PROCEEDINGS ADJOURNED)  3  4 I hereby certify the foregoing to  5 be a true and accurate transcript  6 of the proceedings transcribed to  7 the best of my skill and ability.  8  9  10  11  12    13 Lisa Reid,  14 Official Reporter,  15 UNITED REPORTING SERVICE LTD.  16  17  18  19  20  21  22  23  24  25  26  27  28  29  30  31  32  33  34  35  36  37  38  39  40  41  42  43  44  45  46  47

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