From the Eugene Meehan Supreme Court of Canada Lawletter:
The Cree and Inuit communities signed the James Bay and Northern Québec Agreement with the governments of Quebec and Canada in 1975. The Agreement established a governance scheme and created a framework that would govern many aspects of life in the territory, including the aboriginal economic and social development and the preservation of the natural environment. Under s. 22, the Agreement set out detailed and comprehensive procedures for environmental impact assessments. Whether a provincial or federal assessment will be conducted under the Agreement depends on the constitutional jurisdiction within which the project itself falls. In particular, s. 22.6.7 provides that 'a project shall not be submitted to more than one (1) impact assessment and review procedure unless such project falls within the jurisdictions of both Québec and Canada'. If the exception applies, two assessments will be required, but these assessments may be combined with the 'mutual agreement' of the parties. Section 2.5 of the Agreement also provides that the Agreement is paramount over all other laws of general application that are inconsistent with it.
A company intends to open and operate a mine in the James Bay area of Quebec in the Agreement 'Category III' lands, an area where the Agreement recognizes Quebec's right to regulate natural resource development subject to the environmental protection provisions of s. 22. In accordance with the Agreement's procedures, the proponent of the project submitted to the administrator responsible for 'matters respecting provincial jurisdiction' information concerning its proposed development. The provincial Administrator transmitted this information to the Evaluating Committee, which made a recommendation about the extent of impact assessment and review and whether or not a preliminary and/or a final impact statement should be done. Subsequently, the provincial Administrator alone decided the scope of the assessment and gave appropriate directions to the proponent. On receipt of the provincial Administrator's instructions, the proponent supplied information about the potential environmental and social impacts, which acknowledged a significant impact on fish habitat. This was transmitted by the provincial Administrator to the provincial Review Committee and was then to be transmitted to the Cree Regional Authority for their representations.
Meanwhile, federal officials who were not involved in the review process under the Agreement, concluded that the project's impact on fisheries - a matter within exclusive federal jurisdiction under s. 91(12) of the Constitution Act, 1867 - engaged s. 35(2) of the Fisheries Act and required a comprehensive study pursuant to the regulations made under the Canadian Environmental Assessment Act ('CEAA'). The federal officials informed the Cree that the study would be conducted by a review panel under the CEAA and not through the federal assessment procedure provided for in s. 22 of the Agreement. While the provincial review process of the project was still pending, the Cree commenced an action for declaratory relief in the Quebec Superior Court, which declared that only the provincial environmental assessment was applicable to the project pursuant to the Agreement. The Court of Appeal set aside that decision. The court concluded that the CEAA, in conjunction with the federal Fisheries Act, validly triggered a federal environmental assessment under the CEAA but that there were practical and operational inconsistencies between the CEAA review procedure and the one set out in the Agreement. Since the Agreement was paramount, the court held that CEAA review procedure was inapplicable, but substituted the federal review procedure in the Agreement for the one in the CEAA. The court also concluded that the project is subject as well to the provincial review procedure under s. 22 of the Agreement.
The Supreme Court of Canada held (6:3) that the appeal is dismissed, but the order of the Court of Appeal varied to provide that if the mine project is approved pursuant to the Agreement, the proponent may not proceed with the work without an authorization under s. 35(2) of the Fisheries Act, and that the issuance of any such authorization is to comply with the CEAA in accordance with its procedures, as well as the Crown's duty to consult with the Cree in relation to matters that may adversely affect their rights under the Agreement.
Justice Binnie wrote as follows (at pages 4, 25, 27-28):
"...it is necessary to approach this case on the basis of the terms the parties actually negotiated and agreed to as set out in the text of their agreement rather than on general observations and ideas which, in my respectful view, are unsupported by the text.
...Common sense as well as legal requirements suggest that the CEAA assessment will be structured to accommodate the special context of a project proposal in the James Bay Treaty territory, including the participation of the Cree. Reference has already been made to the possibility of a joint or substituted panel under ss. 40 to 45 of the CEAA. Nevertheless, the legal question before us is whether, absent such an arrangement, the federal Minister is bound to issue a s. 35(2) fisheries permit following the approval of a mining project by the Administrator (or the Quebec Cabinet) and, in my view, he is not so bound.
...In my view, the vanadium mine cannot lawfully proceed without a fisheries permit. The proponent is unable to obtain, and the federal Minister is unable to issue, a s. 35(2) fisheries permit without compliance with the CEAA. The contention of the Quebec Attorney General that the Treaty requires the federal Minister to issue the s. 35(2) fisheries permit as a result of the province-led review panel regardless of the federal Minister's independent assessment of potential damage to fish habitat should be rejected.
It is only after final approval by the Treaty bodies that it can be said that "the proposed development is approved in accordance with the provisions of this Section", which is the condition precedent to the proponent's obligations under s. 22.7.1 to "obtai[n] where applicable the necessary authorization or permits from responsible Government Departments and Services". There is thus no conflict. The need for a post-Treaty approval fisheries permit is made mandatory by the Treaty itself ("shall" obtain). In the case of fisheries, it is federal law, not the Treaty, that governs when such a permit may be granted as well as its terms and conditions.
I agree with the observation expressed by my colleagues LeBel and Deschamps JJ. that "[i]t would hardly be reasonable to believe that the parties intended that one of them might sign the Agreement one day and withdraw its signature the next day, week or year in respect of a key part of their contract" (para. 58). This sentiment is true so far as it goes, but in my view, with respect, it has no application to the dispute at issue in this appeal. I would dismiss the appeal but vary the order of the Quebec Court of Appeal to provide that if the vanadium mine project is approved pursuant to the Treaty, the proponent may not proceed with the work without authorization under s. 35(2) of the Fisheries Act, and that the issuance of any such authorization is to comply with the Canadian Environmental Assessment Act in accordance with its procedures, as well as the Crown's duty to consult with the First Nations in relation to matters that may adversely affect their Treaty rights."