Court of Appeal for Saskatchewan Citation: Michel v Saskatchewan , 2023 SKCA 97 Date: 2023-08-23 Docket: CACV4191 Between: Chief Ronald Michel, Chief of the Peter Ballantyne Cree Nation, on his own behalf and on behalf of all other members of the Peter Ballantyne Cree Nation and the Peter Ballantyne Cree Nation Applicants/Prospective Appellants (Plaintiffs/Respondents) And The Government of Saskatchewan and Saskatchewan Power Corporation Respondents/Prospective Respondents (Defendants/Applicants) And The Attorney General of Canada Respondents/Prospective Respondent (Third Party Defendant/Respondent) Docket: CACV4193 Between: The Attorney General of Canada Applicant/Prospective Appellant (Third Party Defendant/Respondent) And The Government of Saskatchewan and Saskatchewan Power Corporation Respondents/Prospective Respondents (Defendants/Plaintiffs by Third Party Claim) And Chief Ronald Michel, Chief of the Peter Ballantyne Cree Nation, on his own behalf and on behalf of all other members of the Peter Ballantyne Cree Nation and the Peter Ballantyne Cree Nation Respondents/Prospective Respondents (Plaintiffs/Respondents Before: Kalmakoff J.A. (in Chambers) Disposition: Applications dismissed Written reasons by: The Honourable Mr.

Justice Kalmakoff On application from: 2023 SKKB 81 , Saskatoon Applications heard: June 14, 2023 Counsel: Monique Pongracic-Speier, K.C. and Gita Keshava for Chief Ronald Michel and Peter Ballantyne Cree Nation Neil Goodridge and Samantha Gergely for the Attorney General of Canada Mitch McAdam, K.C. and Macrina Badger for the Government of Saskatchewan James Ehmann, K.C. and Diana Lee, K.C. for Saskatchewan Power Corporation Kalmakoff J.A. I. Introduction [ 1 ] This fiat concerns the latest

chapter in long-standing litigation between the Peter Ballantyne Cree Nation [PBCN], the Government of Saskatchewan [Saskatchewan], Saskatchewan Power Corporation [SaskPower] and the Attorney General of Canada [Canada]. PBCN (in CACV4191) and Canada (in CACV4193) both seek leave to appeal against a decision in which a case management judge permitted Saskatchewan and SaskPower to make amendments to their respective statements of defence and third-party claims: Michel v Saskatchewan , 2023 SKKB 81 [ Decision ]. [ 2 ] For the reasons that follow, leave to appeal is denied in relation to both applications. II.

Background [ 3 ] The dispute at issue in the litigation concerns the flooding of land situated at the south end of Reindeer Lake [Southend land]. That land was flooded because of the construction of a dam [Whitesand dam] by the Churchill River Power Company [CRPC] in 1942. The Whitesand dam is now owned by Saskatchewan and operated by SaskPower. As a result of the flooding, PBCN commenced an action in 2004, by way of a statement of claim, against Saskatchewan, SaskPower and Canada, alleging trespass and other causes of action. For a detailed

summary of the historical background underpinning PBCN’s claim, see paragraphs 12–57 of Michel v Saskatchewan , 2021 SKCA 126 [ Michel SKCA ] . [ 4 ] Over the course of the past two decades, through a series of decisions rendered in relation to applications for

summary

judgment, and the appeals from those decisions, much of PBCN’s claim has been dismissed (see: Peter Ballantyne Cree Nation v Canada(Attorney General), 2014 SKQB 327, 455 Sask R 60; and Peter Ballantyne Cree Nation v Canada (Attorney General), 2016 SKCA 124,[2017] 1 WWR 685, with Peter Ballantyne Cree Nation v Canada (Attorney General), 2017 SKCA 5, [2017] 5 WWR 84, together, leaveto appeal to SCC refused, Michel v Canada (Attorney General), ).

All that remains is PBCN’s claim in trespass againstSaskatchewan and SaskPower. [5] In 2018, a judge of what was then the Court of Queen’s Bench permitted Saskatchewan and SaskPower to amend theirrespective statements of defence to assert that the Southend land is not a reserve because it had been transferred to Saskatchewan in 1930pursuant to s. 10 of the Natural Resources Transfer Agreement [NRTA]: Michel v Canada (Attorney General), 2018 SKQB 250.

PBCNwas denied leave to appeal against that decision: Peter Ballantyne Cree Nation v Saskatchewan, 2018 SKCA 90. [6] Saskatchewan and SaskPower have also commenced third-party proceedings against Canada, in which they assert that if theyare found to be liable to PBCN, they should be entitled to indemnity or contribution from Canada. [7] In 2019, Saskatchewan and SaskPower applied for

summary judgment dismissing PBCN’s trespass claim. That applicationwas granted and PBCN’s claim was dismissed, as the judge who heard the application concluded that the Southend land had beentransferred to Saskatchewan under the NRTA in 1930 and, as such, it was not reserve land and could not have been confirmed as a reserveby a 1981 Order in Council that purported to do so (see: Order in Council PC 1981-19). The judge also held that, in 1939, Canada hadgiven its consent to CRPC to flood the Southend land and, as such, the subsequent and ongoing flooding could not be considered atrespass on the part of Saskatchewan and SaskPower: Michel v Canada (Attorney General), 2019 SKQB 334 [2019

Summary JudgmentDecision]. [8] PBCN and Canada both appealed from the 2019

Summary Judgment Decision. In Michel SKCA, this Court allowed theappeal, finding that the judge who had rendered that decision had erred by granting

summary judgment in favour of Saskatchewan andSaskPower, and remitted the matter to the Court of Queen’s Bench for determination of the remaining issues in dispute between theparties. A key finding made by this Court was that the judge had erred in law by holding that the Southend land was not a reserve at therelevant time. Writing for the other members of the panel, Leurer J.A. made this point in several parts of his analysis, including thefollowing passages: [10] In my respectful view, the Chambers judge erred in granting judgment in favour of Saskatchewan and SaskPower.

I haveconcluded that Saskatchewan and SaskPower cannot call into question Southend’s status as a reserve. Their position on this issue iscontrary to the First Appeal Decision [Peter Ballantyne Cree Nation v Canada (Attorney General), 2016 SKCA 124, [2017] 1 WWR685], which was dependent on the proposition that Southend is a reserve. These defendants therefore cannot relitigate this issue. Further,their position is contrary to agreements, including a constitutional amendment that released Saskatchewan from its obligations under theNRTA, which were premised on Southend being a reserve. The [2019

Summary Judgment Decision] also contains several other materialerrors, requiring that the judgment be set aside. … [154] Based on all of this, the application of the principles set out in [Angle v Minister of National Revenue, (SCC),[1975] 2 SCR 248] and [Danyluk v Ainsworth Technologies Inc., 2001 SCC 44, [2001] 2 SCR 460] compels the conclusion that it is notopen to Saskatchewan or SaskPower to question the status of Southend as a reserve.

The Chambers judge therefore erred in law in holdingotherwise. … [182] This Court has previously found that the 1939 consent was a licence given to CRPC by Canada in the exercise of its authorityunder s. 34(1) of the 1927 Indian Act [RSC 1927, c 98]. As stated in Danyluk, this final determination means “the same issue cannot berelitigated in subsequent proceedings between the same parties”. The estoppel this creates “extends to the issues of fact, law, and mixedfact and law that are necessarily bound up with the determination of that ‘issue’” (Danyluk at para 54). One such issue is that Southend isa reserve.

It follows that it is not open to Saskatchewan and SaskPower to question Southend’s reserve status. … [217] For the reasons I have given, the doctrine of estoppel by convention operates and provides a second reason why it was not opento Saskatchewan to assert that Southend is not a reserve. Before leaving this issue, I should add that SaskPower’s rights in this matter flowthrough Saskatchewan.

SaskPower can be in no higher position than the province in relation to the status of the Southend lands. … [218] Principles of issue estoppel and estoppel by convention preclude Saskatchewan and SaskPower from asserting that Southend isnot a reserve. It necessarily follows that the Chambers judge erred when he dismissed PBCN’s claim on this basis. … [230] PBCN can no more relitigate the questions of whether Canada had the authority to grant a licence, and whether the licenceauthorized the scope of the flooding that has occurred than SaskPower and Saskatchewan can reopen Southend’s status as a reserve.

Eachof these issues has been finally decided by this Court. I therefore set them to the side. … [356] The Chambers judge erred in his conclusion that PBCN could not sustain a claim in trespass because Southend is not a reserve. Healso erred when he held that Saskatchewan and SaskPower had defences to PBCN’s claim based on the 1939 consent. I would thereforeset aside the grant of

summary judgment in favour of Saskatchewan and SaskPower.

[9] This Court also concluded that the 1939 consent to the flooding of the land, given to the CRPC by Canada, did not giveSaskatchewan or SaskPower an interest in the Southend land, and that the consent did not continue after CRPC ceased to operate theWhitesand dam. This was because the consent was personal to CRPC and did not attach to the dam. Justice Leurer summarized this pointby saying: [296] In my respectful view, if the Chambers judge had not committed the errors I have identified, he would have concluded that,properly understood, the 1939 consent did not continue after CRPC ceased to operate the Whitesand dam. I am compelled to come to thisconclusion because: (

a) the licence was personal to CRPC and did not attach to the dam; (

b) the government licences issued in associationwith the Island Falls power project and the Whitesand dam were limited in this way; and (

c) this

interpretation should be preferred since itleast impairs PBCN’s interest in its reserve lands. [10] A third key determination made by this Court in Michel SKCA was that, in granting

summary judgment, the judge had erred byfinding that the 1939 consent had become irrevocable under the principles laid out in Bartlett v Corner Brook (City), 2003 NLCA 10, 221Nfld & PEIR 336, because, as Leurer J.A. observed, “the trespass will end if SaskPower stops operating the dam.

This difference takes thefacts here outside of the specific principle identified in Bartlett” (at para 309). [11] Finally, this Court determined that Saskatchewan and SaskPower did not have a defence based on proprietary estoppel, becausethe 1939 consent applied only while CRPC was the operator of the Whitesand dam (see: Michel SKCA at paras 340, 347, and 352–354). [12] In the end, this Court concluded that it was appropriate to remit the matter to the Court of Queen’s Bench to consider whetherthe other defences raised by Saskatchewan and SaskPower, including laches and acquiescence, were applicable, and to consider remedy(see: Michel SKCA at paras 355–358). [13] After the matter was remitted to the Court of Queen’s Bench, Saskatchewan and SaskPower applied to further amend theirpleadings.

PBCN and Canada opposed the application. [14] In general terms, as it is relevant to the question of leave to appeal, the amendments that Saskatchewan and SaskPower soughtto make, and to which PBCN and Canada objected, fell into three categories: (a) “Status of the reserve” amendments, where the amended pleadings question whether the Southend land was a reserve at thetime the flooding began; (b) “Life of the dam” amendments, in which Saskatchewan and SaskPower assert that Canada consented to the flooding of theSouthend land, on behalf of PBCN, for the life of the operation of the dam; and (c) “Fiduciary duty” amendments, in which Saskatchewan and SaskPower assert that Canada breached a fiduciary duty owed toSaskatchewan in connection with the manner in which it set apart the Southend land as a reserve. [15] With the exception of a proposed amendment in which SaskPower purported to rely on the principles of champerty andmaintenance as a defence to the claim of trespass, the case management judge permitted all of the amendments that Saskatchewan andSaskPower sought to make.

In the Decision, he began by reviewing the background facts and the arguments advanced by the parties. Insummarizing Michel SKCA, he stated that this Court had not overruled the 2019

Summary Judgment Decision “on the issue that the[Southend] land is not a reserve” because it dealt “with the debate by way of issue estoppel”, and that he effectively agreed withSaskPower’s argument that “[i]t follows that there continues to be an undisturbed judgment of the [Court of King’s Bench] that theSouthend Land is not a reserve” (Decision at para 10). [16] After doing that, the case management judge reviewed the legal principles that govern the amendment of pleadings.

He notedthe relevant portions of Rule 3-72 of The Queen’s Bench Rules, and quoted from two decisions that provide thorough summaries of theapproach a judge is to take when faced with an application to amend, namely, Casbohm v Winacott Springs Western Star Trucks,2018 SKQB 15 at paras 26–33, 30 CPC (8th) 175, appeal to SKCA dismissed, 2021 SKCA 21, [2021] 4 WWR 506, leave to appeal toSCC refused, , and Cupola Investments Inc. v Zakreski, 2021 SKCA 86 at paras 45–54. [17] The case management judge then turned his attention to the specific amendments that SaskPower and Saskatchewan sought tomake.

He concluded that SaskPower’s proposed amendments were, “to a great extent, a variation of themes that have existed and been inplay throughout the litigation” (Decision at para 19) and determined that those amendments were properly permitted. As for SaskPower’sproposed amendments to its third-party claim against Canada, the case management judge found that, although SaskPower appeared to beraising an argument based in estoppel, “[t]he exact issue articulated in the proposed amendment [was] not … squarely before the Court ofAppeal [in Michel SKCA]”.

Accordingly, he permitted the amendment, so as to not “artificially restrict the issues in debate” (Decision atpara 35). [18] Moving on to Saskatchewan’s proposed amendments, the case management judge appears to have explicitly accepted itsargument that “amendments to pleadings should be allowed unless it is plain and obvious that the arguments will not succeed, or theamendments will cause undue prejudice to the other party”, and that such a determination was to be made “on the same standard as wouldbe applied if an application to strike the pleadings had been made”.

He noted that Saskatchewan had asserted that its proposedamendments, “for the most part, are simply elaborations on the existing pleadings” that did “not raise any truly new issues” or, to theextent they raised new issues, they related to “pure questions of law, and the rely on the same historical evidence that is the foundation forthe existing pleadings” (Decision at para 36). He went on to conclude that Saskatchewan’s proposed amendments should be permitted,stating: [37] In my view, neither PBCN nor Canada should, in any way, be taken by surprise by any of the amendment proposals tendered bySaskatchewan.

As previously noted, SaskPower and Saskatchewan are, to a great extent, riding the same horse in their arguments againstCanada. It is totally appropriate that horse be in the race. [38] Accordingly, all the amendments to the defence put forward by Saskatchewan may proceed, as well as the amendments requestedby Saskatchewan in its third party claim against Canada.

III. Analysis A. The governing test [ 19 ] Where leave to appeal is required, the determination as to whether it should be granted is guided by two key considerations: merit and importance.

An applicant for leave to appeal bears the onus of establishing that the prospective appeal is “of sufficient merit to warrant the attention of the Court of Appeal” and “of sufficient importance to the proceedings before the court, or to the field of practice or the state of the law, or to the administration of justice generally, to warrant determination by the Court of Appeal” ( Rothmans, Benson & Hedges Inc. v Saskatchewan , 2002 SKCA 119 at para 6 , 227 Sask R 121, emphasis in original [ Rothmans ]). [ 20 ] The merit criterion does not set a high bar for a prospective appellant to clear.

At this stage of the analysis, an appellate Chambers judge is not required to decide whether the proposed appeal will succeed, but rather to consider whether the proposed appeal is prima facie frivolous or vexatious or prima facie destined to fail, bearing in mind the standard of review that would apply were leave to be granted and the appeal to proceed (see: Rothmans at para 6; Hawryliw v Smith , 2020 SKCA 92 at para 10 , 18 RPR (6th) 179 [ Hawryliw ]; Verdient Foods Inc. v United Food and Commercial Workers, Local 1400 , 2019 SKCA 137 at para 15 ; and Poffenroth Agri Ltd. v Brown , 2020 SKCA 68 at para 47 , [2021] 2 WWR 302).

Under the merit branch of the test, a judge should also consider whether the appeal would unduly delay the proceedings or add unduly or disproportionately to their cost (see: Rothmans at para 6 ). [ 21 ] The second branch of the test – assessing the importance of the proposed appeal – requires consideration of whether the issues raised by the proposed appeal are of sufficient importance to the proceedings before the court, the field of practice or the state of the law, or the administration of justice generally to warrant determination by the Court of Appeal.

This branch of the Rothmans test asks questions such as: • does the decision bear heavily and potentially prejudicially upon the course or outcome of the particular proceedings? • does it raise a new or controversial or unusual issue of practice? • does it raise a new or uncertain or unsettled point of law? • does it transcend the particular in its implications? [ 22 ] In the end, the authority to grant leave is discretionary and calls for an appellate Chambers judge to decide whether they are sufficiently concerned about the correctness of a decision to warrant its exercise ( Hoedel v WestJet Airline Ltd ., 2022 SKCA 27 at para 12 , 82 CPC (8th) 355).

Such concerns, however, must amount to something of substance. Judges of this Court have repeatedly endorsed the position that the party applying for leave to appeal must demonstrate that both the merit and importance considerations weigh decisively in favour of leave being granted (see, for example: Rothmans at para 6; Hawryliw at para 12 ; Bennett Jones LLP v Frank and Ellen Remai Foundation Inc ., 2016 SKCA 136 at para 13 , 98 CPC (7th) 27; Senko v LeRoy (Rural Municipality) , 2017 SKCA 9 at para 4 ; and Yorkton (City) v Mi-Sask Industries Ltd ., 2020 SKCA 109 at para 19 , 12 CLR (5th) 261).

Even where a proposed appeal appears to have merit, leave may be properly denied if the application fails under the importance branch (see, for example: Transwest Air v BNK Heli-Lease Inc. , 2015 SKCA 76 at paras 6–9 , 465 Sask R 31). B. The proposed grounds of appeal [ 23 ] In its draft notice of appeal, Canada asserts that, in Michel SKCA , this Court made two key determinations: (

i) that Saskatchewan and SaskPower were estopped from asserting that the Southend land was not a reserve; and (ii) that the licence granted by Canada’s consent was personal to CRPC and did not run for the life of the operation of the Whitesand dam. Based on those findings, Canada seeks to appeal against the Decision on the following proposed grounds: (

a) The case management judge erred in principle in applying the test to amend pleadings; (

b) The case management judge’s decision to allow amendments proposed by Saskatchewan and SaskPower questioning Southend’s reserve status was so plainly wrong as to amount to an injustice, and those proposed amendments were barred by res judicata , issue estoppel and estoppel by convention; (

c) The case management judge erred in principle in allowing Saskatchewan and SaskPower to plead that Canada had granted its consent to flood the Southend lands for the lifetime of the Whitesand dam; and (

d) The case management judge erred in principle in allowing Saskatchewan and SaskPower to plead that Canada owes a fiduciary duty to Saskatchewan. [ 24 ] PBCN’s draft notice of appeal is somewhat more difficult to follow, as it contains a mixture of alleged legal errors, arguments and statements of fact. However, from what I can gather, PBCN contends that, in permitting the amendments made by SaskPower and Saskatchewan, the case management judge erred in the following ways: (

a) By permitting amendments that would not have been allowed if he had properly applied Rule 7-9(2)(a), (b), (c), (

d) or (

e) of The Queen’s Bench Rules , because those amendments either; (

i) Amounted to an abuse of process, in that they pleaded matters that are res judicata , or related to defences that had previously been abandoned; (ii) Failed to disclose a reasonable defence;

(iii) Were redundant or immaterial; or (iv) Pleaded defences that were frivolous. (

b) By failing to take a purposive approach to the consideration of the proposed amendments, and by failing to apply Rules 13- 8(1)(c), 13-8(3)(

b) and (

c) and 13-11(4) to disallow the amendments on the grounds that material facts are not pleaded; and (

c) By abusing his discretion and permitting SaskPower to plead a breach of fiduciary duty on behalf of Saskatchewan. C. Applying the Rothmans test to the proposed grounds of appeal [ 25 ] I am prepared to accept that both PBCN and Canada have identified potentially meritorious grounds of appeal. This Court was very clear in Michel SKCA that Saskatchewan and SaskPower were estopped from challenging Southend’s status as a reserve.

In light of that, I will proceed with my analysis on the basis that it is more than arguable that the case management judge misinterpreted the decision in Michel SKCA and, thus, conducted his analysis from a faulty footing.

It is also arguable, for the same reason, that the case management judge erred by failing to properly consider whether the “status of the reserve amendments” were an abuse of process on the basis of pleading matters that are res judicata , or that they failed to disclose a reasonable claim or defence, or that he erred by failing to consider whether those amendments should have been disallowed for other reasons by application of Rule 7-9(2). [ 26 ] It is also at least arguable that the case management judge erred, in the same way, by permitting amendments relating to the operability of Canada’s consent “for the life of the dam”, and that he failed to properly assess whether the “breach of fiduciary duty” amendments or the amendments asserting various forms of estoppel-based defences properly pleaded the necessary elements of a viable claim or defence. [ 27 ] However, it does not automatically follow from all of this that a grant of leave to appeal is appropriate.

As I will explain, there are several reasons why leave should not be granted in this case. [ 28 ] First, in my respectful view, the other aspect of the merit consideration under Rothmans – namely, whether permitting an appeal to proceed would add unnecessarily to the delay and expense of the proceedings – weighs heavily against a grant of leave in this case. This matter has been before the courts for nearly 20 years. The proposed appeal would result in significant additional cost to the parties and add months, if not years, of delay to the proceedings.

And, even if PBCN and Canada were entirely successful in such an appeal, I am not persuaded that the result of that appeal would be one that would significantly affect the action as a whole. [ 29 ] While a decision disallowing or striking the amendments may cut off certain avenues of defence that are now open to Saskatchewan and SaskPower, I fail to see how that would result in a marked narrowing of the issues or shortening of the eventual trial. On this point, I would note that both Saskatchewan and SaskPower rely on the defence of laches and acquiescence, which have not been explored in the proceedings to date.

In addition, the historical background and context that underlies the defences and claims that Saskatchewan and SaskPower assert in the amendments may properly be viewed as relevant to the question of remedy. This means much, if not all, of the same historical evidence will need to be led regardless of whether the impugned amendments are permitted, and many of the same issues would need to be canvassed.

In short, I am not satisfied that the overall benefit to the litigation of permitting the appeal to proceed would be sufficient to justify the expense and delay that would result. [ 30 ] Second, I am also not persuaded that consideration of the importance criterion under Rothmans weighs decisively in favour of leave being granted. [ 31 ] In that regard, I do not view the Decision as bearing heavily or potentially prejudicially upon the course of the outcome of the proceedings.

Most, if not all, of the arguments that PBCN and Canada raise in relation to their applications for leave take primary aim at the merits of the amended pleadings and, in that respect, are more properly viewed as arguments about why the asserted defences or claims ought not to succeed. PBCN and Canada will have the opportunity to make those arguments, with the support of an appropriate evidentiary record, if and when the matter proceeds to trial or another

summary judgment application. Any final determination in that respect could, of course, be appealed to this Court and assessed on the merits in a final way, as opposed to being determined on the basis of whether the case management judge erred in the exercise of his discretion when making the interlocutory decision to permit amendments to the pleadings.

As I see it, looking at the big picture, this means the appeals proposed by PBCN and Canada are “not the best vehicle for examining, and getting to the bottom of, the legal issues” raised by Saskatchewan and SaskPower’s amendments ( Granitewest Developments Ltd. v Saskatchewan (Highways and Infrastructure) , 2016 SKCA 3 at para 26 , 472 Sask R 251). [ 32 ] Moreover, I see nothing in the Decision that raises a new or controversial issue of practice or a new, uncertain, or unsettled point of law. The principles that govern applications to amend pleadings are well established in the jurisprudence.

Nothing in the Decision speaks to a legal issue that requires clarification from this Court. [ 33 ] Finally, I am also unable to find anything in the proposed appeal that transcends the particulars of this case in its implications. Each of the alleged errors, in my view, is confined to the particular and unique circumstances of this case. [ 34 ] Accordingly, I cannot conclude that consideration of the relevant factors weighs decisively in favour of granting leave to appeal. The applications by PBCN and Canada must fail. IV.

Conclusion [ 35 ] The applications for leave to appeal are dismissed. [ 36 ] Given that result, Saskatchewan and SaskPower are entitled to costs. In the circumstances and bearing in mind that the applications were heard together and required each party to prepare a single response and a single memorandum of law, I consider it

appropriate that each respondent receive, and that each applicant pay, one set of costs. Having regard to the Tariff, I fix those costs at $1,500. For the sake of clarity, and for ease of enforcement, I order that PBCN pay $1,500 in costs to Saskatchewan, and that Canada pay $1,500 in costs to SaskPower. “Kalmakoff J.A.” Kalmakoff J.A.