Shade v Canadian Pacific Railway Limited, 2017 ABQB 292

Court of Queen’s Bench of Alberta Citation: Shade v Canadian Pacific Railway Limited, 2017 ABQB 292 Date: 20170428 Docket: 0201 18026 Registry: Calgary Between: Chief Chris Shade and Randy Bottle, Dolores Day Chief, Rod First Rider, Jason Good Striker, Will Long Time Squirrel, Kirby Many Fingers, Danny Mistaken Chief Oliver Shouting, Clement Soop, Ira Tail Feathers, Marcel Weasel Head, Franklin Wells, Chief and Councillors of the Blood Band for themselves and on behalf of the Indians of the Blood Band and the Blood Band (also known as the Kainaiwa/ Blood Tribe) Plaintiffs/Respondents - and - Canadian Pacific Railway Limited, Canadian Pacific Railway Company and the Attorney General of Canada on behalf of Her Majesty the Queen In Right of Canada Defendants/Applicants - and - Canadian Pacific Limited, Fairmont Hotels & Resorts Inc., Encana Corporation and PanCanadian Petroleum Limited and all predecessors and successor companies and subsidiaries of Canadian Pacific Limited Third Party ______________________________________________________ Memorandum of Decision of the Honourable Madam Justice Jo'Anne Strekaf _______________________________________________________

TABLE OF CONTENTS I. Overview - 4 II. Background - 4 A. Procedural History - 4 i. 1999 Federal Court Action – T-342-99 - 4 ii. 2001 Court of Queen’s Bench Action No 0101-07009 - 5 iii. Court of Queen’s Bench Action No 0201-18026 - 5 B. The Pleadings 6 C. Applications by each of Canada and CPR for

Summary Dismissal 10 D. Notice of Constitutional Question - 10 E. Issues 10 F. Facts 10 i. Introduction - 10 ii. 1903 Lands 11 iv. The Station Grounds 12 v. Block B Lands 13 vi. 1982 Task Force Report 13 vii. The Gifting Agreement 16 III. Analysis 16 A.

Summary Dismissal Applications 16 i. Availability of Limitations Defence to Aboriginal Claims (Section 88 of the Indian Act ) 17 ii. Canada’s Application for

Summary Dismissal 19 a. What Limitations Legislation Applies to Canada’s Challenged Claims? - 20 b. Does the trust exemption in the Limitations of Actions Act Apply? - 22 c. What limitations period applies to Canada’s Challenged Claims? - 23 d. Discovery of the Challenged Claims 24 1903 and 1928 Lands – The Initial Taking - 24 Block B Lands 24 1928 Lands’ Railway Right-of-Way - 25 iii. CPR’s Amended Application for

Summary Dismissal 27 a. Overview - 27 b. Causes of Action Pleaded Against CPR - 28 c. The Limitations Period - 28 d. Section 2(4) of the Limitations Act 29 e. Estoppel 29 f. Constructive Trust 30 g. Discoverability and Continuing Cause of Action - 31

B. Notice of Constitutional Question - 33 i. The Notice - 34 ii.

Summary Judgment or Trial? - 34 iii. The Challenged Claims that were Summarily Dismissed - 35 IV. Conclusion - 37 I. Overview [ 1 ] These reasons address three applications—two

summary dismissal applications and a notice of constitutional question— brought in the context of litigation that originated almost two decades ago and raises issues that had their genesis in 1903 and 1928. [ 2 ] An 11-week trial is scheduled for February, 2018 regarding other aspects of the litigation which the parties agree must go to trial. [ 3 ]

Summary dismissal is justified with respect to some of the claims on the basis of the applicants’ limitations defences but other claims for which

summary dismissal was sought must proceed to trial. The summarily dismissed claims are not saved by constitutional considerations. II. Background [ 4 ] An overview of this litigation’s procedural history, its factual underpinnings and an outline of the issues raised by the three applications follows. A.

Procedural History i. 1999 Federal Court Action – T-342-99 [ 5 ] The Chief and Councilors of the Blood Indian Band, also known as the Kainaiwa or Blood Tribe, brought an action in Federal Court on behalf of themselves and all other members of the Blood Tribe (“Blood Tribe”) against Her Majesty the Queen in Right of Canada (“Canada”) on February 26, 1999. [ 6 ] The Blood Tribe is an Indian Band within the meaning of the Indian Act , RSC 1985, c I-5 and Treaty 7.

Canada has jurisdiction over Indians and lands reserved for Indians and has obligations under Treaty 7 and the Constitution Act , 1867 , (UK), 30 & 31 Vict, c 3 reprinted in RSC 1985, App II, No 5. [ 7 ] Canada defended the action in November 2000 and raised, among many other defences, limitations and laches, contending that the “entire action is statute-barred”.

It conceded that certain railway companies appropriated land from the Reserve “for the limited purpose of a railway” but Canada retains a reversionary interest in those lands so that once they are no longer required for railway purposes they revert back to Canada. [ 8 ] The litigation concerned three parcels of land on the Blood Indian Reserve No 148 established in 1889 (“Reserve”).

Those parcels were transferred by Canada in 1898, 1903 and 1928 to various railway companies that were predecessors of the Canadian Pacific Railway Limited or Canadian Pacific Railway Company (collectively “CPR”): • Crow’s Nest Pass Line which ran east-west across the Reserve between Lethbridge and Fort McLeod; • St Mary’s River Railway Company’s Line which ran north-south between Cardston and Stand Off (“1903 Lands”); and • Cardston North Westerly Branch which ran between Cardston to the northwest to the Village of Glenwood (“1928 Lands”). [ 9 ] More detail about the last two parcels is in the “Facts” section.

The Blood Tribe’s claim as regards the Crow’s Nest Pass Line was dismissed by order on June 14, 2016 and no more need be said about it. [ 10 ] As regards the 1903 Lands and the 1928 Lands (collectively, “Lands”), the Blood Tribe claimed that Canada had breached its fiduciary duty when it granted rights-of-way on the Reserve for railway purposes. With the exception of the so-called Block B lands (more about them later), the Lands are still in the possession of the CPR.

The Blood Tribe also contends that when the Lands are no longer used for railway purposes, there is a reversionary interest to Canada for the use and benefit of the Blood Tribe. [ 11 ] The remedies claimed in this action included declarations that Canada was in breach of its duties to the Blood Tribe when it granted the rights-of-way, failed to consult over the locations of the rights-of-way and compensation for granting them; and failed to

ensure that the reversionary interests in the Lands reverted for the Blood Tribe’s benefit. Various heads of damage were also claimed. [ 12 ] Canada and the Blood Tribe agreed to consolidate the 1999 Federal Court action with a new action to be brought by the Blood Tribe in the Court of Queen’s Bench (Action No 0201-18026, see

section iii, below) and the 1999 Federal Court action was discontinued in March 2004. ii. 2001 Court of Queen’s Bench Action No 0101-07009 [ 13 ] In March 2001 Canada filed an action against CPR and PanCanadian Petroleum Limited (“EnCana”, the successor to PanCanadian Petroleum Limited). In effect, this action can be viewed as a third party claim to the Federal Court action detailed above. [ 14 ] This action claimed that the defendants’ actions were contrary to and inconsistent with, among other things, statutory prohibitions against alienation in

section 189 of The Railway Act 1919 , SC 1919 (9-10 George V), c 68. As a result of the defendants’ actions “the Crown has suffered and will suffer damages and loss” for which it sought various heads of damage and declarations as to the ownership of the Lands. [ 15 ] CPR defended on the basis that it lawfully acquired the Lands from Canada and, in any event, discontinued use of the Lands. This action was consolidated in June 2016 with the action discussed immediately below, Action No 0201-18026. iii.

Court of Queen’s Bench Action No 0201-18026 [ 16 ] This action is the subject of these applications. [ 17 ] On October 24, 2002, the Blood Tribe commenced this action in the Court of Queen’s Bench of Alberta on the basis that Canada would “waive any limitation defences that may have arisen” between the filing of the 1999 Federal Court action and the new action.

The correspondence from Canada states in part: “[t]his assumes, of course, that your client’s pleadings will be identical in all respects, save and except for any minor differences arising out of the technical requirements of pleading in the Court of Queen’s Bench as opposed to the Federal Court”. (The significance of this agreement will be addressed in the limitations analysis.) [ 18 ] The defendants in this action were Canada, CPR and its predecessor and successor companies and subsidiaries, and EnCana and its predecessor and successor companies and subsidiaries.

In addition to the breaches alleged against by Canada (detailed in the Federal Court action overview above), the Blood Tribe claimed that the 1903 Lands and 1928 Lands each formed part of the Reserve and were wrongfully expropriated, suffered environmental damage and other loss and damage. [ 19 ] Canada and the CPR defended, on the basis of, among other things, limitations and laches. [ 20 ] Canada filed a third party notice against CPR and its predecessor and successor companies and subsidiaries, and EnCana and its predecessor and successor companies and subsidiaries.

The third party claim is not at issue in these applications. [ 21 ] The Blood Tribe discontinued its action against EnCana and its predecessor and successor companies and subsidiaries in December 2015. [ 22 ] Unless otherwise specified, all subsequent reference is to this action. B. The Pleadings [ 23 ] An overview of aspects of the pleadings is necessary to understand the claims that Canada and CPR want summarily dismissed (“Challenged Claims”). 42.

As a result of the Defendant’s actions, individually and collectively, the Plaintiffs have suffered and will suffer damage and loss, some particulars of which are as follows: (

a) the Blood Tribe has been deprived of the use, occupation, possession and ownership of the 1903 Railway Lands; (

b) the Blood Tribe has been denied the ability to manage the 1903 Railway Lands as it sees fit; (

c) the Blood Tribe has been denied the revenues generated from the 1903 Railway Lands and the ability to generate further revenues; (

d) the 1903 Railway Lands have been damaged and their value diminished; and (

e) such further and other particulars as may be proven at the trial of this Action and Action 0101-07009. […] 50. As a result of CPR and the Crown’s actions, the Blood Tribe has suffered and will suffer damages and loss, some particulars of which are as follows: (

a) the Blood Tribe has been deprived of the use, occupation, possessing and ownership of the 1928 Railway Lands; (

b) the Blood Tribe has been denied the ability to manage the 1928 Railway Lands as the Blood Tribe sees fit; (

c) the Blood Tribe has been denied the revenues generated from the 1928 Railway Lands, and the ability to generate further

revenues; (

d) the 1928 Railway Lands have been damaged and their value diminished; and (

e) such further and other particulars as may be proven at the trial of the within and Action 0101-07009. […] 57. The Plaintiffs state that the Crown had a fiduciary duty to protect Reserve lands from being alienated form the Reserve and to ensure that no lands were removed without legal justification and proper legal process. 58. The Plaintiffs further state that the Crown had a fiduciary duty to expropriate or grant only the minimum interest in Reserve lands to fulfil the taking of lands for railway purposes. 59.

The Plaintiffs claim that the Crown has breached its trust or fiduciary obligations owed to the Blood Tribe in relation to the granting of right-of-ways on Reserve lands for railway purposes, including but not limited to the following: (

a) by allowing CPR to construct railway lines and station grounds on the Reserve without consultation with or consent of the Blood Tribe and despite instructions from the Blood Tribe that railway lines were not desired on the Reserve; (

b) by failing to consult with the Blood Tribe in relation to the proposed plans and location of the railway lines and appropriate compensation for the right-of-ways and station grounds; (

c) by allowing the railway lines to cut through the most fertile sections of the Reserve which was to the detriment of the Blood Tribe; (

d) by not ensuring that the mines and mineral rights to the 1903 Railway Lands and the 1928 Railway Lands were not transferred to CPR and then to PanCanadian Petroleum Limited; (

e) by refusing or failing to take such action as was necessary to have the mines and minerals transferred back for the benefit of the Blood Tribe once it was discovered title had changed; (

f) by not ensuring that once the railway right-of-ways and station grounds were no longer used for railway purposes, that they immediately reverted back to the Crown for the use and benefit of the Blood Tribe; (

g) in the alternative, by not ensuring that the various grants for railway right-of-ways and station grounds included a reversionary clause such that if the land which was subject to the grants was no longer being used for railway purposes that it would immediately revert back to the Crown for the use and benefit of the Blood Tribe and to Reserve status; (

h) by taking over 40 years to return Block B from the 1903 Railway lands back to Reserve status; (i) [dismissed by June 14, 2016 Order of Hughes J] (

j) by placing the Blood Tribe in a position where it was and is required to purchase the railway right-of-ways and station grounds if the lands are to be returned to Reserve status; (

k) by refusing or failing to obtain the return of the 1928 Railway Lands after the discontinuance of the railway in 1968 and reverting the same to Reserve status and the continuing refusal or failure to have this land reverted to the Crown for the use and benefit of the Blood Tribe; (

l) by refusing or failing to obtain the return of the 1903 Railway Lands after the discontinuance of the railway in 1999 and reverting the same to Reserve status and the continuing refusal or failure to have this land reverted to the Crown for the use and benefit of the Blood Tribe; (

m) by failing or refusing to enforce the agreement with CPR and its predecessors to build fences, gates, cattle guards and crossings to avoid the loss of Blood Tribe livestock. [ 24 ] Paragraph 62 of the pleadings seek against Canada (with emphasis added): (

a) a Declaration that the Crown breached Her trust and/or fiduciary obligations to the Blood Tribe by failing to prevent the railway companies from obtaining right-of-ways through the Reserve for railway lands; (

b) a Declaration that the Crown breached Her trust and/or fiduciary obligations owed to the Blood Tribe by not consulting with the Blood Tribe regarding the negotiations with the railway companies over the location of the lines or the proper compensation for the right-of-ways; (

c) a Declaration that the Crown breached Her trust and/or fiduciary obligations owed to the Blood Tribe by allowing CPR to obtain right-of-ways over the most fertile

section of the Reserve; (

d) a Declaration that the Crown breached her trust and/or fiduciary obligations owed to the Blood Tribe by not ensuring that once the lands described as the …, 1903 Railway Lands and 1928 Lands (the “Lands”), or any of them, were no longer used for railway purposes that they did not immediately revert back to the Crown for the use and benefit of the Blood Tribe; (

e) in the alternative to (d), a Declaration that the Crown breached Her trust and/or fiduciary obligations owed to the Blood Tribe by not ensuring that the revisionary interests in the Lands remained with, or for the use and benefit of the Blood Tribe;

(

f) damages for breach of fiduciary duty in an amount to be proven at trial. [ 25 ] Paragraph 63 details the claims against CPR and Canada (with emphasis added): (

a) a Declaration that when the Lands were no longer required for railway purposed then all right, title and interest in the lands reverted back to the Crown for the use and benefit of the Blood Tribe and to Reserve status; (

b) in the alternative to (g), if the Lands, or any of them, are still being used for railway purposes, then a Declaration or Order that, upon their ceasing to be so used, all right, title and interest of the Defendants, or any of them, to such land, whether legal or equitable, determines and reverts to the Crown for the use of the benefit of the Blood Tribe and the Reserve status. (

c) an accounting for any income made by the Defendants, or any of them, up to the date of judgment, with respect to the Lands, including those generated by the use of such lands, the extraction or removal of mines and minerals or other resources from the lands, or the conveyance, alienation, transference, sale, assignment, lease or other disposition of the Lands; (

d) damages for wrongful alienation and deprivation of the Blood Tribe’s right to the continued used and enjoyment of the Lands [as against Canada only ; dismissed against CPR by June 14, 2016 Order of Hughes J]; (

e) damages for the loss of use and occupation of the Lands from the date they were no longer required for railway purposes up to the date of judgment [as against Canada only ; dismissed against CPR by June 14, 2016 Order of Hughes J]; (

f) removal and clean-up of all environmental contamination present upon, under or within, and a restoration or remediation of the Lands, including any environmental assessments, studies or reports required or appropriate in relation thereto, or, in the alternative, an award of damages sufficient to compensate the Blood Tribe for taking such steps; (

g) damages for the decrease and productivity and value of the Lands and those lands adjacent to the Lands due to the actions of the Defendants [as against Canada only ; dismissed against CPR by June 14, 2016 Order of Hughes J]; (

h) interest… (

i) costs … (

j) such further and other relief … C. Applications by each of Canada and CPR for

Summary Dismissal [ 26 ] Canada and the CPR each made an application for

summary dismissal of some of the Blood Tribe’s claims contending they were barred by limitations legislation. [ 27 ] Canada and CPR submit that the Blood Tribe knew of the existence of the material facts supporting the Challenged Claims well before the expiry of the applicable limitations period. They also argue that

summary dismissal is appropriate because a

summary determination that is fair and just can be made on the evidence before the Court. The Blood Tribe argued that the applications for

summary dismissal should be dismissed because there is insufficient evidence before the Court to make the necessary findings of fact about the limitations defence. D. Notice of Constitutional Question [ 28 ] In response to Canada and the CPR’s applications for

summary dismissal of the Challenged Claims, the Blood Tribe filed a Notice of Constitutional Question on April 16, 2016. It sought a declaration that the Alberta limitations legislation was not applicable, and

section 32 of the Crown Liability and Proceedings Act , RSC 1985, c C-50 and its predecessor legislation was unconstitutional and of no force and effect in respect of the Challenged Claims. The Attorney General of Alberta exercised its right to be heard. E. Issues [ 29 ] Two issues must be determined on these applications. Can the Challenged Claims be determined summarily because the limitations legislation provides a complete defence? If so, does the application of limitations defences to the Blood Tribe’s claims raise constitutional issues that require a trial? [ 30 ] The

summary dismissal applications are discussed first, and the Notice of Constitutional Question application second. Of necessity there is some overlap between the two. F. Facts i.

Introduction [ 31 ] The evidence on these applications is from the affidavits of Kirby Many Fingers (the Blood Tribe’s representative who was the Director of the Tribe’s Tribal Government before serving as Councillor from 1988-92 and 1993-2012); Don Girardin (Land Management Officer in the Alberta Region for what was called the Department of Indian Affairs and Northern Development Canada in 2015 when his affidavit was sworn); and James Bildfell (Real Estate Manager for Sales and Acquisitions with the CPR), and transcripts from questioning on those affidavits.

[ 32 ] Canada and the Blood Tribe entered into Treaty 7 in September 1877. The Reserve was established in 1889. For analytical purposes, it is convenient to separate out from the Lands two parcels: the so-called “Block B Land” and the “Station Grounds”. Each has unique attributes and must be analyzed separately. [ 33 ] The Blood Tribe’s dissatisfaction with the CPR’s ownership of the Lands is long-standing. In fact, it predates the transfers from the Reserve in 1903 and 1928.

For example, a letter from the Indian Agent to the Commissioner dated November 24, 1898 stated that “...the two head chiefs of the Reserve, have asked me to write to you on the matter of the right away of the railway, Crows Nest Pass through this Reserve.

They say this line was surveyed and made without their consent being obtained and now trains have been running over it for nearly a year and still no settlement made.” A follow-up letter dated October 5, 1899 stated that “...the Department were repeatedly asked, before any final arrangement were come to, to protect the interest of the Indians by forcing the railway company to fence ...”. [ 34 ] When the Town of Cardston proposed annexation of some of the Lands in 1969, the Blood Tribe expressed its concern with CPR’s ownership of the Lands. [ 35 ] In correspondence to Canada dated June 29, 1978, the Chief of the Blood Tribe wrote: “After reviewing our files on Blood Reserve lands expropriated, I find the issue of the Cardston CPR right of way and grounds still unsettled.

The lands in question were alienated … without consent, with no reversionary clause. It is our position that the lands … should be reacquired since they are no longer directly used by the C.P.R.”.

The Blood Tribe’s affiant responded to an undertaking about this correspondence as follows: “The correspondence is one in a series that represents an ongoing dialogue over decades wherein the Blood Tribe sought to recover the abandoned railway lands”. [ 36 ] This culminated in the task force which report issued in 1982 and subsequently proposed gifting agreement discussed below. [ 37 ] Reference is made throughout to variants of the phrase “used for railway purposes”.

It is contended in Canada’s action against CPR (Action 0101-07009) and in this action that CPR was prohibited by statute, Orders in Council, Letters Patent, etc. from alienating the Lands or from using them for other than railway purposes. The

interpretation and application of this phrase will be resolved elsewhere but it is relevant to these applications insofar as the claims raise the question of when the Lands were no longer used for railway purposes (if at all) in the context of the limitations period. ii. 1903 Lands [ 38 ] In 1903 Canada appropriated 69.4 acres from the Reserve for the St Mary’s River Railway Company branch line running north-south on the Reserve between the communities of Stand Off and Cardston (“1903 Line”). [ 39 ] Canada made the grant to the St Mary’s River Railway Company on October 22, 1903 by Order in Council No P.C. 1723.

St Mary’s River Railway Company later became part of the CPR. [ 40 ] Of the 69.4 acres, 51.4 acres were for the right-of-way and 18 acres for the station grounds at Cardston. [ 41 ] In 1999, the CPR announced that it intended to sell or discontinue the 1903 Line.

In November 1999 Canada took the position that it retained the revisionary interest to the 1903 Lands (including the mines and minerals) and gave CPR notice of same. [ 42 ] Operation of the 1903 Line was discontinued on March 24, 2000. [ 43 ] At present, the Land Title Certificate for Plan RY29 shows CPR as the owner of an estate in fee simple excepting out, inter alia , the Block B Land and mines and minerals.

A caveat was registered against this title in July 1981 by Chief Roy Fox and twelve other persons on behalf of themselves and all other members of the Blood Band on the basis of their interest in the land “by virtue of an unregistered instrument, namely, Articles of Treaty made and dated the 2 nd day of July A.D., 1883 between Her Majesty the Queen and the Blood Band of Indians”. iii. 1928 Lands [ 44 ] In 1928 Canada appropriated 278.464 acres from the Reserve for a branch railway line running northwest from Cardston to Glenwood (“1928 Line”). Order in Council No. P.C. 17 was granted on January 10, 1928.

The land was granted to the Alberta Railway and Irrigation Company which eventually became part of the CPR. [ 45 ] Part of the land was used for a right-of-way and part for the station grounds at Cardston. The allocation for each of these two purposes is not reflected on the title. However, there is correspondence between CPR and Canada which refers to 254.71 acres of the 278.464 acres as railway right-of-way so for the purposes of these applications, it is reasonable to assume that 24.054 acres comprise “station grounds”.

This allocation is also supported by maps in the evidence. [ 46 ] Operation of the 1928 Line was discontinued on December 31, 1979. For the purposes of these applications, it will be assumed that this is the earliest date on which the railway right-of-way in the 1928 Lands was no longer used for railway purposes. [ 47 ] The Land Title Certificate Plan RW 218 shows the CPR as the owner in fee simple excepting out mines and minerals.

A caveat was registered in July 1981 by Chief Roy Fox and twelve other persons on behalf of themselves and all other members of the Blood Band on the basis of their interest in the land “by virtue of an unregistered instrument, namely, Articles of Treaty made and dated the 2nd day of July A.D., 1883 between Her Majesty the Queen and the Blood Band of Indians”. iv. The Station Grounds [ 48 ] The 1903 Lands and the 1928 Lands each included an area of station grounds at the junction of the Standoff and Glenwood

railways (“Station Grounds”). The Station Grounds are located north of what is now Highway 5 by the Town of Cardston. The Station Grounds were initially used for a station, a workshed, facilities and equipment. They comprise a total of about 42.054 acres (18 acres of the 1903 Lands and 24.054 acres of the 1928 Lands). [ 49 ] The Station Grounds are discussed separately because at various times some of those lands were leased to third parties arguably for non-railway purposes.

For example, a letter from a CPR subsidiary to Canada dated September 1969 states: “I have reviewed our property in Cardston and find the bulk of it leased to various firms in Cardston and frankly, in view of the demand for this land, we feel it would be poor business on our part to sell this property”. A map attached to the Affidavit of Kirby Many Fingers shows parcels leased to Agricore, United Grain Growers, Imperial Oil for a bulk fuel station, Balog Auctions Services and Agrium.

The questioning of Mr Bildfell confirms this. [ 50 ] The Blood Tribe’s affiant agreed on questioning that “at least as of 1969, the Blood Tribe and its legal counsel were of the view or taking the position that certain station ground lands were being leased or used by third-party commercial tenants”.

He also agreed that “the objective at that time was to see if the lands could be returned to the reserve”. [ 51 ] On September 22, 1969, the Blood Tribe’s counsel wrote to Canada advising that certain of the Lands “are no longer being used for railway right-of-way or station grounds, but are being used for a variety of commercial and industrial purposes which are in no way connected with railway use”. [ 52 ] Issues in this action include whether the third-party leases of the Station Grounds were for railway purposes, and one of the Blood Tribe’s claims is for an accounting for income generated from the Lands. v.

Block B Lands [ 53 ] A 6.38 acre parcel known as Block B is located near the Station Grounds. It was originally part of the 1903 Lands but when it was determined in 1928 that it was not required because railway routing had changed it was transferred back to Canada. This occurred on September 24, 1928. [ 54 ] It was added to the Reserve on December 3, 1969 by Order in Council 1969-2280.

Of the approximately 350 acres (347.864) acres at issue in these proceedings, these are the only lands that have reverted to the Reserve. vi. 1982 Task Force Report [ 55 ] In about 1980 and 1981, Canada and the Blood Tribe created a task force to examine the issues related to, among other things, CPR’s use of the lands. A final report produced by the task force was titled “Report on the Task Force and Blood Indian Land Claims as They Relate to Land Currently Owned by the CPR” and dated August 12, 1982 (“Report”). It is 15 pages long and because of its significance to the

summary dismissal applications, some extracts from it are reproduced for ease of reference. [ 56 ] The Report addresses the Lands. It discusses some of the applicable statutory framework and, as regards the 1928 Lands, states (with bolding added for emphasis; underlining in the original) at pp 5-7: The right-of-way lands are no longer used for railway purposes. It is our understanding that agreement has been reached for the gifting back of these lands to the Crown as trustee for the Blood Band.

We are advised by counsel for C.P.R. that they have done all that is necessary on their part to effect this gifting back. It appears that the matter is still under discussion between the Provincial and Federal Governments. As this matter has been outstanding for some considerable length of time, we recommend that the Band Council contact the respective Governments and determine the status of this matter and whether there are any impediments to the immediate transfer of these lands.

We are advised by counsel for C.P.R. that the lands … use[d] as station grounds are no longer being used for railway purposes (i.e., they have been leased to other companies). In light of the above we feel it is appropriate that direct negotiations be entered into in respect of these lands for their return for the use of the Band. This objective may be accomplished in one of two ways. The lands could simply be gifted back to the Crown as trustee (as is contemplated [for the right-of-way].

Alternatively, title could be amended to reflect the fact that the C.P.R. acquired only a determinable fee simple with a reversion to the Crown for the benefit of the Blood Band. The circumstances which would trigger the crystallization of that reversionary interest have occurred (ie. the fact that the line is no longer used for railway purposes).

Accordingly, the lands should now revert to the Crown. [ 57 ] As regards the 1903 Lands , (which railway line was not discontinued until March 2000, almost 20 years after the Report issued) the Report sets out the applicable legislation and states with emphasis added: We are advised by counsel for the C.P.R. that those portions of the station grounds which were taken … in 1903 are not amongst those currently used for non-railway purposes.

Clearly the Band should investigate and either confirm or refute that statement, In the event that the CPR is correct … it may be difficult to argue that the Indians have an immediate right to regain those lands. However, in negotiation with the C.P.R. it would be desirable to obtain their acknowledgement that in the event that the lands ceased to be used for railway purposes they will revert to the Crown for the benefit of the Band. Alternatively, in the event that it is necessary to pursue litigation in this matter it may be possible to obtain a Declaratory Order of the Court to that effect.

While the Court may decline to rule on a hypothetical situation … it may be possible to have the Court order a rectification of the title so as to indicate that the transfer was not a grant of fee simple absolute, but rather a determinable fee simple or form of statutory easement. We are advised that the [ right-of-way ] are still being used for railway purposes. Accordingly, it would be difficult to sustain an argument that the Band has an immediate right to return of these lands.

However, the same objectives in negotiation are still available as with the … station grounds. [As regards mineral rights] the Registrar of Land Titles erred in granting a title to St. Mary’s without a mineral reservation. The title is

subject to correction to restore the minerals to the Crown in Right of Canada in trust for the Band. There is a small question as to the applicability of the Railway Act to this transaction. This Act first became effective February 1, 1904. The grant to the lands was made November 30, 1903 … [but] was not registered in the Land Titles Office until February 4, 1904. From this

section [of the Land Titles Act , s 36 quoted in full] it appears that the effectiveness of the grant is determined by reference to the date of registration and not the date of execution. On this basis, the Land Titles Register may be subject to correction to restore the mineral rights to the Crown in Right of Canada in trust for the Band. [ 58 ] Under a

section titled “Conclusions and Recommendations” the authors write: the claim of the Blood Band in these matters is exceedingly strong and, therefore, direct negotiations should be entered into with the C.P.R. It is the view of the Task Force that the Federal Government, if requested by the Blood Band, should be involved in assisting the Blood Band during these negotiations. In negotiations we recommend that the following objectives be set: 1. That the [1903 Lands’ right-of-way] be immediately reconveyed to the Crown for the benefit of the Blood Band … [and] expedited. 2.

That those portions of the [1928 Land] station grounds … currently being used for non-railway purposes be reconveyed to the Crown for the benefit of the Band. 3. That the mineral rights … be immediately reconveyed to the Crown for the benefit of the Band. 4.

In the event that those portions of the [1903] station grounds … are not being used for railway purposes then, such lands reconveyed to the Crown for the benefit of the Band. …In the event that those lands are being used for railway purposes at the present time then, the title to those lands should be amended so as to reflect the fact that the C.P.R. only holds a determinable fee simple … 5. That title to the right of way [1928] lands be amended to reflect the fact that the CPR holds only a determinable fee interest… 6.

That the mineral rights to the [1903] lands be immediately reconveyed to the Crown for the benefit of the Band. [ 59 ] The Blood Tribe’s affiant said in questioning that after the Report was issued, members of the task force, Chief Roy Fox, the Blood Tribe’s legal counsel, representatives of CPR and others met. The Blood Tribe’s legal counsel received correspondence from Canada in December 1982 providing an update with respect to Canada’s efforts, which was followed up by letter dated January 1983.

CPR’s counsel sent a letter to Canada the same month stating that the Station Grounds were not abandoned and had not been declared surplus. [ 60 ] Thereafter a letter dated August 9, 1983 was sent by the Blood Tribe’s counsel stating that “it appears an action will have to be commenced if the Band has any hopes of obtaining title to the” Station Grounds.

The last sentence asked Canada “if you would advise as to how we might get together and make concrete decision as to the manner in which the litigation can be proceeded with”. [ 61 ] A follow-up letter to Canada dated January 11, 1984 from the Blood Tribe’s counsel stated that the Blood Tribe is “most upset as to what they perceive to be a lack of progress being made in effecting transfers and registrations” for the land and mineral rights. The Blood Tribe has “indicated to me that if they have not received a positive indication from [Canada] Justice … [counsel is] to unilaterally commence an action”.

Canada responded with its letter about the gifting agreement, discussed next. vii. The Gifting Agreement [ 62 ] Canada replied April 27, 1984 with a progress report on its negotiations with CPR with regard to the mineral Quit Claim and the gifting agreement, about which there “are a few items that need clarification and further details are required and it may take some time for this agreement to be finalized ” (with emphasis added).

More specifically: I have still not had a determination from Justice as to whether or not an action will be commenced against CPR regarding the land around the station ground. … I will advise you when the transfer back of the mines and minerals from [EnCana] and the gifting back of the abandoned rail line has been completed. [ 63 ] The uncontroverted evidence shows there were extensive negotiations between Canada and the CPR about a proposed gifting agreement (“Gifting Agreement”) in regard to the by-then-discontinued 1928 Land’s right-of-way (as distinct from its Station Grounds).

In short, the Blood Tribe was advised of the Gifting Agreement, that Canada and CPR were in the midst of negotiating it, and it would take “some time” for the Gifting Agreement to be finalized. [ 64 ] In 1989, the Blood Tribe’s Executive Secretary was sent a copy of the draft Gifting Agreement and advised that Canada was “presently awaiting return of the signed Agreement and the Transfer of Land” from the CPR. [ 65 ] Events that occurred after 1989 are critical to the limitations defence and are discussed in detail in the next section. III. Analysis A.

Summary Dismissal Applications [ 66 ] Canada and the CPR each apply for

summary dismissal of the Challenged Claims.

[67] The proper approach to

summary dismissal is found in Hryniak v Mauldin, 2014 SCC 8, [2014] 1 SCR 87, Windsor vCanadian Pacific Railway Ltd, 2014 ABCA 108, 572 AR 317 and subsequent decisions. In Whitecourt Power Limited Partnership vElliott Turbomachinery Canada Inc, 2015 ABCA 252 at para 9, 606 AR 248, the Court held that if a “defence is so compelling that thelikelihood it will succeed is very high” it should be determined summarily. “A second consideration is whether examination of theexisting record can lead to an adjudication and disposition that is fair and just to both parties”: ibid. [68] When a limitations defence forms the basis of a

summary dismissal application, the applicant (defendant) bears the initialevidentiary burden of establishing that its defence is so compelling that the likelihood it will succeed is very high. Once satisfied, therespondent (plaintiff) must either refute or counter the defendant’s evidence, or risk

summary dismissal. [69] If “the evidence conflicts on a material point, or is hearsay, the party resisting

summary judgment can demand a trial as ofright”: Poliquin v Devon Canada Corporation, 2009 ABCA 216 at paras 10-13, 454 AR 61. Viewed from the opposite perspective, “afull trial will still be required where a

summary record cannot fairly be used to decide legal issues which are unsettled, complex orintertwined with the facts”: Amack v Wishewan, 2015 ABCA 147 at para 36. [70]

Summary dismissal on the basis of a limitations defence does not mean the underlying claim is not meritorious, as explainedin Samson First Nation v Canada, 2015 FC 836 at para 89, appeal dismissed in Buffalo v Canada, 2016 FCA 223: It should always be borne in mind that in deciding whether

summary judgment based upon the expiry of a limitation period isappropriate, the Court is not pronouncing upon the merits of the underlying claims. In the present case, the Plaintiffs may well havelegitimate complaints, in both fact and law, about …. But the law of limitations provides that, generally speaking, even a legitimate claimmust be brought within a prescribed period of time unless, of course, the claim is one that is not subject to a limitations defence.

It maybe necessary at times to look at the merits in order to understand what is at stake in these motions and the role that a limitations defenceshould play given the nature of the claims in question but, in the end, the Court is deciding whether or not there is a genuine issue fortrial on the limitations defence and not whether the claims have merit. i. Availability of Limitations Defence to Aboriginal Claims (Section 88 of the Indian Act) [71] The Blood Tribe raises

section 88 of the Indian Act in this context and in the Notice of Constitutional Question. In the presentcontext, the Blood Tribe is not advancing a constitutional argument that Parliament could not have made lands reserved for Indianssubject to provincial laws, but simply that

section 88 does not do so as a matter of statutory

interpretation.

Section 88 states: Subject to the terms of any treaty and any other Act of Parliament, all laws of general application from time to time in force in anyprovince are applicable to and in respect of Indians in the province, except to the extent that those laws are inconsistent with this Act orthe First Nations Fiscal Management Act, or with any order, rule, regulation or law of a band made under those Acts, and except to theextent that those provincial laws make provision for any matter for which provision is made by or under those Acts. [72] The Blood Tribe points out that

section 88 refers only to provincial laws “applicable to and in respect of Indians in theprovince” and not to “Lands Reserved for Indians”. Pursuant to section 91(24) the Constitution “Indians and Lands Reserved forIndians” are within the exclusive legislative authority of Parliament. In short, the Blood Tribe contends that

section 88 does notreferentially incorporate Alberta’s limitations legislation when it comes to “Land Reserved for Indians”. [73] The Blood Tribe relies on Reference Re Stony Plain Indian Reserve No. 135 (1981), 1981 ABCA 316 , 130 DLR(3d) 636 (Alta CA). In that case the Court accepted “the general proposition that provincial legislation relating to use of reserve lands isinapplicable to lands that are found to be reserved for Indians”: para 54 with emphasis.

That appeal concerned land in the Stony PlainIndian Reserve No. 135 which members of the Enoch Band of Indians intend to surrender in accordance with sections 37 and 38 of theIndian Act, and the issue was whether the laws of Alberta or of Canada would apply to the surrendered lands. [74] Reference Re Stony Plain Indian Reserve No. 135 is distinguishable. Limitations legislation does not relate to the “use of”reserve lands.

It is provincial legislation “relating to” when a defendant is entitled to defend against an action on the basis that theplaintiff should have brought the action earlier. [75] The Supreme Court considered

section 88 in Kitkatla Band v British Columbia (Minister of Small Business, Tourism andCulture), [2002] 2 SCR 146, 2002 SCC 31 and Dick v La Reine, (SCC), [1985] 2 SCR 309, 23 DLR (4th) 33. In Dick theCourt concluded:

Section 88 of the Indian Act does not incorporate, as part of federal legislation in respect to Indians, all provincial laws of generalapplication. On one hand, s. 88 refers to the provincial laws which cannot apply to Indians without regulating them qua Indians, i.e.,provincial legislation which, per se, would not apply to Indians under the Indian Act unless given force by federal reference.

On the otherhand, provincial laws of general application which can apply to Indians without touching their Indianness apply to them ex propriovigore. [76] From these cases I conclude that the following must be determined. [77] First, does the limitations legislation fall “under provincial legislative jurisdiction as being a law relating to property and civilrights within the province, under s. 92(13) of the Constitution Act”: Kitkatla Band at para 31? I conclude it does. [78] Second, is limitations legislation “a law of general application”?

It is not if it is “shown that the intent, purpose or policy ofthe legislation was to impair the status or capacities of a particular group”: Dick cited to SCR at 310. I conclude that it has the identicalimpact on all litigants. It is a provincial law of general application which “can apply to Indians without touching their Indianness” and

therefore applies to the Blood Tribe ex proprio vigore (by its own force, Black’s Law Dictionary ). [ 79 ] Specifically in the context of Aboriginal land-related claims, the Supreme Court held in several recent decisions that limitation periods in provincial legislation apply to such claims. As Binnie J stated in Canada (Attorney General) v Lameman , 2008 SCC 14 at para 13 , [2008] 1 SCR 372: This Court emphasized in Wewaykum Indian Band v. Canada , [2002] 4 S.C.R. 245, 2002 SCC 79 , that the rules on limitation periods apply to Aboriginal claims.

The policy behind limitation periods is to strike a balance between protecting the defendant's entitlement, after a time, to organize his affairs without fearing a suit, and treating the plaintiff fairly with regard to his circumstances. This policy applies as much to Aboriginal claims as to other claims, as stated at para. 121 of Wewaykum : Witnesses are no longer available, historical documents are lost and difficult to contextualize, and expectations of fair practices change.

Evolving standards of conduct and new standards of liability eventually make it unfair to judge actions of the past by the standards of today. [ 80 ] In Manitoba Métis Federation Inc. v Canada (Attorney General) , 2013 SCC 14 , [2013] 1 SCR 623, the Supreme Court confirmed that provincial limitations legislation applies to Aboriginal claims for personal remedies, such as damages claims for breaches of fiduciary duty. [ 81 ] As a result,

section 88 of the Indian Act does not preclude the application of limitations legislation to the

summary dismissal claims. The Blood Tribe’s constitutional arguments related to

section 88 are addressed in the Notice of Constitutional Question, below. ii. Canada’s Application for

Summary Dismissal [ 82 ] Canada acknowledged in its brief and oral argument that it is not seeking

summary dismissal of claims: (

i) pertaining to declaratory relief and title to the lands; (ii) relating to environmental remediation; or (iii) an accounting or damages for breach of fiduciary duty or damages for loss of use and occupation of the 1903 Lands (except Block

B) and the 1928 Land’s Station Grounds. [ 83 ] Canada is seeking dismissal of claims that relate to the initial taking of the Reserve lands and those arising out of acts that occurred subsequently (“Canada’s Challenged Claims”). [ 84 ] As regards damages ( not declaratory relief) in relation to events that occurred at the time of the initial taking, Canada seeks

summary dismissal of: • Damages for Canada’s breach of its fiduciary duty (paras 57-58); • Damages for Canada’s breach of its duty to consult (paras 59(a)-(c)); • Damages for the absence of a reversionary clause in the agreements with CPR (para 59(g)); • Damages for putting the Blood Tribe in a position where it may be required to purchase the Lands (para 59(j)); • Damages related to livestock claims (para 59(m)) • An accounting for lost income in relation to the above (para 63(c)); and • Damages for wrongful alienation and deprivation of use in relation to the above (para 63(d)) [ 85 ] As regards claims in relation to events that occurred after the initial taking, Canada seeks

summary dismissal of the following claims relating to Block B and the 1928 Lands railway right-of-way : Damages because it took more than 40 years to return the Block B lands to Reserve status (para 59(h)); • Damages for failure to ensure that once the 1928 Land’s railway line right-of-way was no longer used for railway purposes, it immediately reverted to the Crown for the use and benefit of the Blood Tribe (para 59(

f) and (k)); • An accounting for lost income in relation to the above (para 63(c)); • Damages for wrongful alienation and deprivation of use in relation to the above (para 63(d)); and • Damages for the loss of use and occupation of the Lands from the date they were no longer required for railway purposes up to the date of judgment as regards (para 63(e)) [ 86 ] Canada pleads a limitations defence to all Canada’s Challenged Claims and points to the Report, and contends that by 1982 at the latest, Blood Tribe knew of all Canada’s Challenged Claims. [ 87 ] Canada submits the Court must determine the “legal question of which limitations statutes and sections apply” and “factual questions regarding when the challenged claims arose and the Plaintiff’s knowledge of those claims at the relevant times”. [ 88 ] The Blood Tribe submits that all Canada’s Challenged Claims are based on breaches of fiduciary duty and opposes the application on four main grounds: i. the claims fall within the trust exemption to the limitations bar; ii. the limitation period did not start to run until the Blood Tribe knew that Canada had ceased to perform its fiduciary

obligations, which was well within the applicable limitation period; iii. the claims are not suitable for

summary dismissal; and iv. Alberta’s limitation statutes are constitutionally inapplicable to the claims against Canada. a. What Limitations Legislation Applies to Canada’s Challenged Claims? [ 89 ] Provincial limitations statutes apply to proceedings against the Crown in respect of causes of action arising in that province: Crown Liability and Proceedings Act , s 32. [ 90 ] The Limitations Act applies to proceedings commenced after March 1, 1999: s 2(1).

However, an action “brought by an aboriginal people against the Crown based on a breach of a fiduciary duty alleged to be owed by the Crown to those people is governed by the law on limitation of actions as if the Limitation of Actions Act , RSA 1980 cL-15, had not been repealed and this Act were not in force”: s 13. [ 91 ] In Manitoba Metis Rothstein JA noted at para 251 (in dissent but not on this point): As ultimate limitations periods were introduced, many provincial legislatures chose to effectively exempt certain types of Aboriginal claims from them by grandfathering Aboriginal claims into the former acts, which did not contain ultimate limitations periods.

This was done in Alberta … [by] s. 13…. In my view, this is evidence that legislatures are alive to the issues posed by Aboriginal claims and limitations periods …. [ 92 ] “Section 13 does not say that there is no limitation period on aboriginal claims, it just preserves the old law for those claims indefinitely”: Papaschase Indian Band (Descendants of) v Canada (Attorney General) , 2004 ABQB 655 at para 130 , 365 AR 1. [ 93 ] Canada agrees that what it characterizes as the fiduciary duty damage claims are governed by the Limitation of Actions Act .

However, Canada submits that the remaining Canada’s Challenged Claims—the accounting, wrongful alienation, and use and occupation claims (“Remaining Challenged Claims”)—are subject to the Limitations Act as they were first advanced in Action 0201- 18026, commenced on October 24, 2002. [ 94 ] The essence of the Remaining Challenged Claims, when the Statement of Claim is read as a whole, are all premised on Canada breaching fiduciary duties it owed to the Blood Tribe.

Accordingly, the Limitation of Actions Act applies to all of Canada’s Challenged Claims. [ 95 ] Although it is not strictly necessary to make a finding on this point, I have also concluded for the reasons that follow that, properly construed, the agreement between Canada and the Blood Tribe as regards the interval between the Federal Court action (filed February 1999) and this action (commenced October 24, 2002) means the Remaining Challenged Claims are also subject to the Limitation of Actions Act . [ 96 ] On November 23, 2003, Canada wrote the Blood Tribe that it “will waive any limitations defence that may have arisen between the dates of filing the Statement of Claim in [the Federal Court action] and [Action No.] 0201-18026”.

Canada argues that the Remaining Challenged Claims were not part of the waiver. [ 97 ] However, when Canada agreed to the waiver, the Blood Tribe had already filed an amended statement of claim in the Federal Court action. Amendments in Federal Court are permitted with leave (rule 76) “notwithstanding that the effect of the amendment will be to add or substitute a new cause of action, if the new cause of action arises out of substantially the same facts as a cause of action in respect of which the party seeking the amendment has already claimed relief in the action”: Federal Courts Rules , SOR/98-106, r 201.

The Blood Tribe asserts that it would have been granted leave to amend its statement of claim. [ 98 ] Accordingly, only changes between the amended Federal Court action and Action No 0201-18026 are not governed by the waiver. In this regard, the Blood Tribe further submits that all those changes were required because it added CPR as a defendant in Action No 0201-18026 and none of the changes add a new cause of action. More particularly, paragraph 63(c)—the accounting claim— was required as a result of adding CPR and follows the prayer for relief in Canada’s action against CPR.

The Blood Tribe submits that it would have been a permitted amendment pursuant to the Alberta Rules of Court , Alta Reg 124/2010. [ 99 ] Canada submits prejudice to it by the amendment outweighs the significance of the special circumstances and would have resulted in a rejection of the Blood Tribe’s amendment application, citing Fiebich v Ortlieb , 2004 ABCA 256 at para 41 . It also rejects as unreasonable the Blood Tribe’s explanation for why the Remaining Challenged Claims were not in the original Federal Court action. [ 100 ] For the purposes of Canada’s

summary dismissal application I am satisfied that the special circumstances are not outweighed by prejudice to Canada so it is reasonable to conclude that the amendments would have been permitted and are therefore subject to the waiver. [ 101 ] As a result, all of Canada’s Challenged Claims are subject to the Limitation of Actions Act . b. Does the trust exemption in the Limitations of Actions Act Apply? [ 102 ] The effect of

Section 40 of the Limitations of Actions Act is that no claim by a beneficiary against a trustee for property held on an “express trust” or in respect of a breach thereof “shall be held to be barred by this Act”. [ 103 ] I have considered the Supreme Court’s dicta in Ermineskin Indian Band and Nation v Canada , [2009] 1 SCR 222, 2009 SCC 9 with emphasis added:

[72] … I see no reason why the duties of a common law trustee cannot be applied to any other fiduciary relationship if the nature of therelationship requires it. … [73] If a situation is such that a fiduciary is in a position similar to that of a trustee, even though the situation cannot necessarily becategorized as a “common law trust”, I do not see why the common law duties of a trustee cannot be applied to that fiduciary if that iswhat the particular situation warrants. In this case, the bands have placed particular emphasis on a trustee’s duty to invest their royalties— the trust corpus.

In my opinion, if the situation is such that the Crown is in the position of a fiduciary, although not strictly speaking atrustee at common law, and holds funds on behalf of the bands, it is not improper to ascribe to the Crown a duty to invest those funds inthe manner of a common law trustee, subject to any legislation limiting its ability to do so. [74] In my view, therefore, the relationship between the Crown and the bands is a fiduciary relationship that is trust-like in nature.

TheCrown possesses a discretionary power to act in the best interests of the bands, and the bands are vulnerable to the Crown’s exercise ofthat discretion. The Crown may only grant rights over the minerals upon terms that are most conducive to the welfare of the bands, andwill hold the proceeds of the granting of those rights on behalf of the bands. [104] However, like in Ermineskin Indian Band and Nation (which found no common law trust), the most fundamental requirementfor the existence of an express trust—certainty of intention—is not satisfied on these facts. Accordingly,

section 40 has no application. [105]

Section 41 concerns trustees whose trust obligations arise by construction or implication of law, which might apply given theErmineskin Indian Band and Nation passages cited above. The difficulty is subsection 41(2) requires that the claim by the Blood Tribebe “founded on a … fraudulent breach of trust to which the trustee was a party or privy, or is to recover trust property” absent which atrustee has the “rights and privileges conferred by this Act … as they would have been … if the trustee … had not been a trustee”.

Inshort, unless the constructive trustee committed a fraudulent breach of trust, the usual (non-trust) provisions of the Limitations of ActionsAct apply: see generally Angeletakis v Thymaras (1989), (AB KB), 95 AR 81, 65 Alta LR (2d) 345 and the cases itcites. [106] Nothing in the Blood Tribe’s pleadings suggests that Canada’s breach was “fraudulent”. In the result, sections 40 and 41 do notpreclude a limitations defence. c. What limitations period applies to Canada’s Challenged Claims? [107] The limitations periods in

section 4 of the Limitations of Actions Act applies. For ease of reference, the relevant subsections are: 4(1) The following actions shall be commenced within and not after the time respectively hereinafter mentioned: […] (

c) actions (

i) for the recovery of money, other than a debt charged on land, whether recoverable as a debt or damages or otherwise, or (ii) for an account or for not accounting, within 6 years after the cause of action arose; … (

e) actions grounded on … other equitable ground of relief not hereinafter specifically dealt with, within 6 years from the discovery ofthe action… [108] When considering these provisions in Lameman, the Supreme Court noted at paras 15 and 16: The issue becomes when the cause of action "arose" or, in the case of equitable claims, was actually "discovered". The applicable definition of when a cause of action arises was articulated by this Court in Central Trust Co. v.

Rafuse, (SCC), [1986] 2 S.C.R. 147, at p. 224: ... a cause of action arises for purposes of a limitation period when the material facts on which it is based have been discovered or oughtto have been discovered by the plaintiff by the exercise of reasonable diligence ... [Emphasis added] [109] In Manitoba Metis, the Court considered identical limitation legislation “barring ‘actions grounded on … other equitable groundof relief’ six years after the discovery of the cause of action”: para 138. It held that “[b]reach of fiduciary duty is an ‘equitable ground ofrelief’.

We agree … that the limitation applies to Aboriginal claims for breach of fiduciary duty with respect to the administration ofAboriginal property”: ibid. [110] The Blood Tribe contends that if a limitations period applies, it is subsection 4(1)(e). Canada agrees that the claims for breachof fiduciary which formed part of the Federal Court action are subject to subsection 4(1)(e). As noted above, Canada’s position—which Irejected—is that the Limitations Act applied to the Remaining Challenged Claims.

I also concluded that all the claims were, in substance,predicated on allegations of Canada’s breach of its fiduciary duty to the Blood Tribe. [111] To the extent that a claim for an accounting is expressly addressed by subsection 4(1)(c)(ii) of the Limitation of Actions Act,that provision governs the accounting claim. Subsection 4(1)(

e) applies to the balance of Canada’s Challenged Claims. d. Discovery of the Challenged Claims [112] The Blood Tribe argues that discoverability of Canada’s Challenged Claims occurred when it discovered by the exercise of

reasonable diligence that Canada had ceased to perform its fiduciary obligations as regards the Lands.

The determinative question is whether, before February 1993 (six years before February 26, 1999 when it filed the Federal Court action), the Blood Tribe discovered (in the case of the equitable claims) or ought to have discovered (for the purposes of the accounting claim) that Canada was (arguably) in breach of its obligations. 1903 and 1928 Lands – The Initial Taking [ 113 ] The first subset of the Challenged Claims concerns events that occurred at or shortly after the initial taking of the Reserve Lands in 1903 and 1928. Elements of those wrongs are outlined in paragraphs 57, 58, 59 (a)-(c), (g), (

j) and (m), and the damages claimed are in paragraphs 62(a)(b)(c)(

e) and (f), and 63(

c) and (

d) of the Statement of Claim. [ 114 ] As noted in the “Introduction” to the Facts section, the Blood Tribe expressed its dissatisfaction with CPR’s ownership of the Lands from the outset. [ 115 ] Thereafter, of particular note is the letter dated July 25, 1969 from “solicitors for the Blood Band Council who have consulted us with respect to their intention to re-acquire for the Reserve [the 1903 Lands] ... and our instructions from the Band ... to take whatever steps are appropriate to oppose the proposed annexation by the Town of Cardston of [certain parcels]”. [ 116 ] In 1978, the Chief of the Blood Tribe wrote Canada that the “lands in question were alienated through the 1886 Indian Act without the consent of the Bloods, with no reversionary interest included in the transfer.” These concerns ultimately led to the work of the Task Force and its Report.

It is apparent the Blood Tribe was well aware of the material facts in relation to the claims arising out of the initial taking of the Lands by at least 1978. [ 117 ] Canada’s limitations defence succeeds and

summary dismissal is warranted on Canada’s Challenged Claims which relate to the initial taking. Whether this conclusion survives the issues raised in the Notice of Constitutional Question is considered below.

Block B Lands [ 118 ] CPR transferred the Block B Lands back to Canada in September 1928 and Canada reconveyed them to the Reserve on December 3, 1969 by Order in Council 1969-2280. [ 119 ] The Blood Tribe refers to the evidence of its affiant who stated that these lands are not practically available for the use and benefit of the Blood Tribe until the balance of the surrounding Station Grounds are reconveyed. I reject this argument.

The limitations period for any cause of action for which damages or an accounting in relation to Block B are claimed began to run at the latest in 1969, and expired long ago. [ 120 ] In the result, all claims for damages or an accounting that relate to the Block B lands are summarily dismissed, except those related to environmental contamination and remediation concerning which Canada did not apply for

summary dismissal. [ 121 ] Whether this conclusion survives the Notice of Constitutional Question is considered below. 1928 Lands’ Railway Right-of-Way [ 122 ] Canada is also seeking dismissal of claims arising from its failure to ensure that the 1928 Land’s railway right-of-way did not immediately revert to the Crown for the benefit of the Blood Tribe once it was no longer used for railway purposes on December 31, 1979. [ 123 ] The Blood Tribe argues that because there is a single title for all the 1928 Lands (that is the Station Grounds and the railway right-of-way), they must be considered as one.

I reject that submission and see no reason why the limitation issues with respect to the 1928 railway right-of-way are linked to the 1928 station grounds, given the difference in their factual matrix. [ 124 ] Although it could be argued that the 6-year discoverability period should start on January 1, 1980 (the day after this railway’s operation ceased), there was evidence that Canada was in good faith negotiations (about the Gifting Agreement) with CPR to recover the lands for the benefit of the Blood Tribe.

As already noted, Canada’s correspondence with Blood Tribe’s counsel in 1984 stated that in Canada’s negotiations with CPR about the mineral Quit Claim and the gifting agreement concerning the “abandoned portion of the railway ”, there “are a few items that need clarification and further details are required and it may take some time for this agreement to be finalized ”. [ 125 ] This letter’s reference to the “abandoned portion of the railway” must mean that it and subsequent correspondence concerning the Gifting Agreement concerned the 1928 Land’s railway right-of-way only.

As regards the 1928 Land’s Station Grounds, these were specifically excluded from the Gifting Agreement as the CPR’s letter to Canada dated July 1988 makes clear. It explains that only 254.71 acres of the 1928 Land’s 278.464 acres were included in the Gifting Agreement. (And, of course, CPR used the railway right-of- way on the 1903 Lands until 2000 so it could not have been included in the Gifting Agreement.) [ 126 ] The Blood Tribe submits that it “was entitled to wait” for Canada’s due performance before commencing an action even if it believed that a breach had occurred. For the purposes of this

summary dismissal application, I agree that Canada has not established that in 1984 the limitations period had begun to run as regards the fiduciary claims concerning the 1928 Land’s railway right-of-way. [ 127 ] The question is whether it was reasonable for the Blood Tribe to wait almost a decade before filing its claim against Canada. Events between then and February 26, 1993 are therefore critical and set out in some detail. [ 128 ] On February 29, 1985 Canada wrote the Blood Tribe’s counsel:

I am continuing my negotiations with CPR regarding the gifting agreement of the abandoned railway line. It is my opinion that we are nearing agreement although there are still a few details to be worked out. I have not as yet received a reply as to whether the Department of Justice is prepared to commence an action on behalf of the Blood Band in connection with the lands the Band feels it is entitled to have the CPR reconvey. However, as the facts are not particularly strong given that the land has not been alienated by C.P.R., I would doubt that the Department would want to commence an action relating to it.

Also, the Kruger case has recently been heard in the B.C. Supreme Court and a decision should soon be received in that case.

I will inform you when we have received that decision. [ 129 ] It is reasonable to infer that the Blood Tribe could not have discovered by the exercise of reasonable diligence that Canada had ceased to perform its fiduciary obligations at the date of this letter. [ 130 ] On June 8, 1992 Canada wrote an inter-departmental letter concerning the 1928 Land’s railway right-of-way and its mines and minerals: Proposal Reconstitution of the surface (254.71 acres) and the mines and mineral (278.464 acres) comprising the abandoned railway right-of-way, station grounds and extra lands which were formerly part of [the Reserve] as … RW 218. […] Analysis Through a Gifting Agreement (copy attached), Canadian Pacific Limited will agree to reconvey unto [Canada] the surface to that portion of the railway right-of-way (254.71 acres) [of the 1928 Lands]. … The Lands Directorate found the Gifting Agreement to be acceptable for execution … and is now pending acceptance and execution by the Canadian Pacific Limited. … Present Status of Transaction On October 9, 1990 we wrote to the Band … and received a signed Band Council Resolution #FY-90-91-6771 dated October 17, 1990. [ 131 ] In late 1993 the Gifting Agreement took a turn.

In October 1993, Canada wrote CPR referencing the “number of cases where CP has acquired land for railway purposes from Indian reserves and a number of these takings are now before the courts”.

It raised the possibility “with regard to other takings not in court, some sort of global approach could be developed which would help avoid future disputes with respect to these lands”. [ 132 ] CPR responded as follows in January 1994: as the nature and title of CP’s titles to former reserve lands acquired by it from the Crown is presently before the Supreme Court of British Columbia in a trial starting January 31, 1994, we think it would be preferable to await the judgment in that case before engaging in in the kind of discussion you have suggested. [ 133 ] In answer to an undertaking, the Blood Tribe’s affiant advised that between 1989 and 1994 or 1995, “Canada was leading negotiations with the CPR to obtain a suitable agreement for the return of the lands to Canada.

That process continued up to at least June 24, 1994”. [ 134 ] Given the foregoing, at least until early 1994 when the proposed Gifting Agreement fell apart, the Blood Tribe could reasonably have believed that Canada was discharging its fiduciary duty as regards the reconveyance of the 1928 Lands railway right-of-way. [ 135 ] In other words, Canada has not established that in February 1993 the Blood Tribe discovered or could have discovered the cause of action—breach of Canada’s fiduciary duty in relation to its obligation to revert the lands back to Reserve status—by the exercise of reasonable diligence.

At that time Canada was still in the process of negotiating the reversion of the 1928 Land’s right-of-way and mineral rights to Reserve status, and it has not been established that any fiduciary breach had yet occurred and that the limitation period had commenced to run. [ 136 ] Given that conclusion,

summary dismissal of claims for damages or an accounting is not appropriate as regards the 1928 Land’s railway right-of-way . Accordingly,

summary dismissal of these Challenged Claims is dismissed. iii. CPR’s Amended Application for

Summary Dismissal a. Overview [ 137 ] CPR is applying for

summary dismissal of the Blood Tribe’s claims for an accounting on the basis these claims are barred by the expiry of the limitation period. In the alternative, CPR applies to summarily dismiss the Blood Tribe’s claims for an accounting prior to October 24, 2000, two years prior to commencement of the action against it. [ 138 ] The Blood Tribe submits that there are genuine issues for trial with respect to CPR’s limitation defence to its accounting claims. They cannot be determined summarily because: i. The Limitations Act does not apply to the claim based on CPR’s adverse possession of Crown lands by virtue of s 2(4)(

a) of the Limitations Act ;

ii. CPR is estopped from relying on the Limitations Act as it has denied that the lands were not required for railway purposes, and the limitation period can only begin to run once they ceased requiring the lands for railway purposes; iii. The income subject to accounting is subject to a constructive trust and the earliest a limitation period can run is from the time that the trust came into existence, which is when the lands were no longer required for railway purposes; iv. If the Limitations Act applies, the cause of action was not discoverable by the Blood Tribe; and v.

The ultimate limitation period cannot be used so long as the CPR is in possession of the lands in issue. [ 139 ] A sixth counter to the limitations defence—the contention that the Limitations Act does not apply to claims regarding the use, possession and enjoyed of reserve land as

section 88 of the Indian Act does not apply to lands reserved for Indians—was rejected above. b. Causes of Action Pleaded Against CPR [ 140 ] It is necessary to begin the analysis of CPR’s amended application for

summary dismissal with a determination of the causes of action relevant to the accounting claim against it. CPR does not defend against them on this application; its amended application for

summary dismissal simply asserts the claims are statute-barred. However, given that the causes of action influence whether the Blood Tribe’s counters to the limitations defence (e.g., the constructive trust, causes of action not discoverable, etc.) have sufficient merit to deny

summary dismissal, a preliminary determination of what those causes of action may be is necessary. [ 141 ] First, paragraphs 42 (re 1903 Lands) and 50 (re 1928 Lands) of the Statement of Claim allege that as a result of CPR’s actions the Blood Tribe has been: “deprived of the use, occupation, possession and ownership” of the Lands (paragraph (a)); and “denied the revenues generated from the [Lands] and the ability to generate further revenues” (paragraph (c)). [ 142 ] At paragraph 63(

c) the Blood Tribe claims “an accounting for any income made … including those generated by the use of [the Lands] or … lease … of the Lands”. [ 143 ] What is the substantive nature of this claim? CPR is a private corporation. It has no fiduciary duty to the Blood Tribe because there is no evidence to “show that the alleged fiduciary gave an undertaking of responsibility to act in the best interests of a beneficiary”: Alberta v Elder Advocates of Alberta Society , 2011 SCC 24 at para 30 , [2011] 2 SCR 261.

This means the claim cannot be grounded in a breach of fiduciary duty. [ 144 ] Nothing suggests a contractual relationship between CPR and the Blood Tribe exists in this context. So a claim for breach of contract is precluded. [ 145 ] The property-related action of adverse possession is discussed below. Other property-related torts including trespass are not alleged and in any event, at all relevant times CPR had title to the Lands. [ 146 ] The Blood Tribe’s brief refers to restitution, which likely refers to an action in unjust enrichment.

That is, CPR was enriched from its use, occupation and ownership of the Lands and the Blood Tribe was correspondingly deprived, and there was no juristic reason for CPR’s enrichment at least from the time the Lands ceased to be used for railway purposes. For the purposes of limitations analysis, unjust enrichment is viewed as the cause of action. c. The Limitations Period [ 147 ] The Blood Tribe’s action against CPR was commenced October 24, 2002.

The Limitations Act “applies where a claimant seeks a remedial order in a proceeding commenced on or after March 1, 1999, whether the claim arises before, on or after March 1, 1999”: s 2(1).

Accordingly, the Limitations Act applies. [ 148 ] Section 2(2) of the Limitations Act provides that if the Blood Tribe knew or in the circumstances ought to have known of the claim and did not seek a remedial order for its accounting claim six years ( Limitations of Actions Act , s 4(1)(c)) after it knew of the material facts underlying it, the limitation period is the earlier of that date or March 2, 2001. [ 149 ] CPR submits that the Blood Tribe knew of the potential accounting claims well before March 1, 2001 therefore its claims were statute-barred on March 1, 2001 at the latest, prior to commencement of the action on October 24, 2002. d.

Section 2(4) of the Limitations Act [ 150 ] The Limitations Act provides that: “This Act does not apply where a claimant seeks a remedial order based on adverse possession of real property owned by the Crown”: s 2(4)(

a) with emphasis. [ 151 ] The Blood Tribe submits that section 2(4)(

a) applies to its accounting claim because it seeks a remedial order “based on” a claim that CPR has “adverse possession of real property owned by the Crown”, that is the Lands (except Block B). [ 152 ] The phrase “adverse possession” in section 2(4)(

a) refers specifically to the doctrine of adverse possession which has a particular meaning: Lutz v Kawa , 1980 ABCA 112 , 23 AR 9. Had the Legislature intended that section 2(4)(

a) apply more broadly, that is, permitting a claim by a third party alleging that another party has wrongful possession of Crown land, it would not have chosen the phrase “adverse possession” which has a well-established and particular meaning in the context of Alberta’s limitations legislation. [ 153 ] In Joarcam LLC v Plains Midstream Canada ULC , 2013 ABCA 118 at para 9 , the Court of Appeal stated: The appellant also submits that it is entitled to rely upon sections 3(3)(

f) and 3(4) of the [ Limitations Act ]. These are also exceptions to

the usual two-year limitation period. … These provisions are intended to deal with claims by a registered owner of land to recoverpossession of that land from another person who would have recourse to the doctrine of adverse possession after the relevant limitationperiod. The Act does not create different limitation periods for different types of claims. It does not create a different limitation periodsimply because real property is the subject of the claim. As an exception to the usual two-year limitation period, sections 3(3)(

f) and 3(4)must also be construed narrowly. …. The doctrine of adverse possession does not arise on the facts of this case. Accordingly, sections3(3)(

f) and 3(4) have no application. [154] The Blood Tribe’s

interpretation of section 2(4)(

a) is not a counter to CPR’s limitations defence. e. Estoppel [155] The Blood Tribe submits that CPR is estopped from relying on the Limitations Act because CPR repeatedly denied that theLands were used other than for railway purposes, and it cannot now say that the Blood Tribe should have known otherwise. [156] The Blood Tribe relies on the questioning of CPR’s affiant.

He agreed that “CPR denies that those leases were not used forrailway purposes”; “the leases would have been in some capacity involved in that regard [delivering and moving commodities] of ouroperation” and at no time, prior to the action against CPR being filed, was CPR no longer using the [1903 Lands and/or the 1928 Lands]for railway purposes”. [157] The Blood Tribe relies on the following principle in R v British Columbia (Minister of Finance), (BC CA),[1934] 4 DLR 27 at para 6: To the many cases referred to on the argument I add … Cave v.

Mills (1862), 7 H. & N. 913 at 927-8, in the last of which the Court said: … a man shall not be allowed to blow hot and cold - to affirm at one time and deny at another - making a claim on those whom he hasdeluded to their disadvantage, and founding that claim on the very matters of the delusion.

Such a principle has its basis in commonsense and common justice, and whether it is called “estoppel”, or by any other name, it is one which Courts of law have in modern timesmost usefully adopted. [158] While it is possible to raise estoppel to either refute or counter the defendant’s limitations defence (see generally, Blair vDesharnais, 2005 ABCA 272, 371 AR 196) specific requirements must be satisfied.

In Blair, the Court held that the: [8] … party relying on the doctrine must establish that the other party has, by words or conduct, made a promise or assurance which wasintended to affect their legal relationship and to be acted on. Furthermore, the representee must establish that, in reliance on therepresentation, he acted on it or in some way changed his position. [9] Moreover, there must be “evidence that one of the parties entered into a course of negotiation which had the effect of leading theother to suppose that the strict rights u

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