Environmental Appeal Board

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1 Environmental Appeal Board Fourth Floor 747 Fort Street Victoria British Columbia Telephone: (250) Facsimile: (250) Mailing Address: PO Box 9425 Stn Prov Govt Victoria BC V8W 9V1 DECISION NO WAT-004(a) In the matter of an appeal under section 92 of the Water Act, R.S.B.C. 1996, c BETWEEN: Fishstriker Industries Ltd. APPELLANT AND: Deputy Comptroller of Water Rights RESPONDENT AND: BC Hydro and Power Authority THIRD PARTY BEFORE: DATE: APPEARING: A Panel of the Environmental Appeal Board Alan Andison, Chair Conducted by way of written submissions concluding on July 7, 2008 For the Appellant: Ollie Rode For the Respondent: Livia Meret, Counsel For the Third Party: J. David S. Avren, Counsel PRELIMINARY ISSUE OF JURISDICTION [1] On April 24, 2008, Fishstriker Industries Ltd. ( Fishstriker ) appealed a March 24, 2008 decision of Glen Davidson, Deputy Comptroller of Water Rights, Ministry of Environment (the Deputy Comptroller ), refusing Fishstriker s application to terminate Water Act Permit 3779 ( Permit 3779 ) authorizing Occupation of Crown Land. Permit 3779 is currently held by BC Hydro and Power Authority ( BC Hydro ). [2] Permit 3779 was originally issued in 1953 to the Northern British Columbia Power Company Limited by the then Deputy Minister of Lands. It authorized a right of way across specified Crown land where a transmission line had been constructed to transmit energy from the Falls River Generating Station to the area in and around the City of Prince Rupert. [3] BC Hydro now owns the Generating Station and the transmission line. [4] Fishstriker appeals the Deputy Comptroller s decision on the grounds that the decision does not conform to the Water Act or government policies regarding transmission lines on Crown land. Fishstriker maintains that, contrary to the position of the Deputy Comptroller, Permit 3779 has never provided the proper legal authority for transmission lines on Crown land and, to the extent that it attempts to do so, it is invalid.

2 DECISION NO WAT-004(a) Page 2 [5] Further, a portion of the transmission line proceeds through land that is now owned by Fishstriker, although it was Crown land at the time that the transmission line was constructed. Fishstriker submits that Permit 3779 does not, and has never, provided legal authority for the line on its property. [6] Consequently, Fishstriker asked the Deputy Comptroller, and now this Board, to terminate Permit [7] On April 28, 2008, the Board wrote to the parties requesting submissions on whether it has jurisdiction over the appeal, including whether it has the authority to grant the remedy sought by Fishstriker, i.e., the termination of a 1953 permit issued by the Deputy Minister of Lands. [8] All parties made submissions on the issue of jurisdiction. BACKGROUND [9] In 2005, Fishstriker purchased a number of lots from Columbia Cellulose Company Limited, one of which was District Lot ( DL ) 972, Range 5 Coast District, Except Plan 4394 and Plan The lot is located approximately 19 kilometres from Prince Rupert, is 800 metres wide and 1600 metres long. Fishstriker states that the lot is heavily forested, which is typical of the wet climate of Prince Rupert. [10] There are two transmission lines on DL 972. One of the lines is covered by a right of way registered on title (B7274) in the name of BC Hydro; the other is not. It is the unregistered transmission line that is the subject of this appeal, and that will be referred to in this decision. [11] The transmission line runs from the Falls River Generating Station to Prince Rupert, approximately 50 kilometres north-west of the Generating Station. The Generating Station and transmission line were constructed as part of a power project on the Falls River approved in or around The energy generated by the water in Falls River was to be distributed and sold to the City of Prince Rupert and all territory within 75 miles of the said city. [12] Of relevance to this appeal, the project involved the diversion of 600 cubic feet of water per second from Falls River, and the storage of 30,000 acre-feet of water in the channel of the river, as well as certain works for the generation of electrical energy. The diversion and storage of water were authorized through a Certificate of Approval of Undertaking, signed by the then Minister of Lands on September 27, 1929, and by Conditional Water Licence ( CWL ) 10186, issued by the Comptroller of Water Rights on October 23, The Certificate and licence were issued to Northern British Columbia Power Company Limited in accordance with the provisions of the 1924 Water Act. [13] The works authorized by the licence were a dam and penstocks. In 2006, a licence issued in substitution for CWL added a powerhouse to the description of the works. [14] According to sections 49 and 50 of the 1924 Water Act, the Minister of Lands could issue a permit authorizing the entry upon Crown lands to a licensee for the purpose of constructing, maintaining, or operating his works. In 1930, the then Deputy Minister of Lands issued a Permit under the Water Act authorizing Entry

3 DECISION NO WAT-004(a) Page 3 upon Crown Lands, (Permit 579), to the power company. The permit authorized a right of way of particular dimensions over Crown land as shown on an attached plan. The plan shows the right of way passing through DL 972 which was, at that time, Crown land. Although not stated in the permit, there is no question that the right of way was for a transmission line as it proceeds from the Generating Station to Prince Rupert. [15] It is unclear when the transmission line was constructed, but it appears that it was in place by 1941 when a new permit to occupy Crown land (Permit 2075), was issued in place of Permit 579. The 1941 permit specified the right of way as being across Crown land known as Ranges 4 and 5, Coast District, and on which is located a transmission line for the carriage of electrical energy. [16] The 1941 permit was replaced in 1953 with the subject permit, Permit Permit 3779 increased the length of the right of way as well as the amount of rent payable to the Crown for the right of way. [17] Between the issuance of the 1941 permit and the 1953 permit, DL 972 was granted by the Crown to Columbia Cellulose Company Limited for $2,550. However, it was not until Fishstriker purchased the property that the authority for the transmission line was questioned. [18] Based on the documents provided to the Panel, it appears that after Fishstriker purchased DL 972 in 2005, it decided to subdivide the property. In the course of planning to do so, Fishstriker s research led it to question the legal basis for the transmission line right of way. [19] For most of 2006 and into 2007, both Fishstriker and its legal counsel corresponded with BC Hydro regarding its transmission line. (BC Hydro had become the owner of the Generating Station and transmission line in 1966.) BC Hydro advised Fishstriker of its opinion that a number of documents, including Permit 3779, the water licence and the Crown Grant for DL 972, provided the appropriate authority for the transmission line to occupy, and for BC Hydro to access, what is now Fishstriker s private land. [20] Fishstriker disagreed. As a result, it sought confirmation of its position on Permit 3779 from the Deputy Comptroller. [21] Fishstriker wrote two letters to the Ministry (June 11, 2007 and October 10, 2007), questioning the authority for the transmission line. The Deputy Comptroller responded in letters dated August 20, 2007 and November 27, 2007, providing some of the legislative history governing the issuance of these permits, and concluding that there was no basis for assuming that Permit 3779 was issued without proper authority. Specifically, in his November 27, 2007 letter, he advised Fishstriker as follows: 1. Validity of PCLs (Permits) 579, 2075 and 3779 These permits were issued by the Deputy Minister of Lands. As indicated in my letter of August 20, 2007 I have no reason to believe that these permits were issued without proper authority. At the time of the Crown grant of District Lot (DL) 972 the permit in place (PCL 2075) ceased to be applicable over DL 972. The replacement permit PCL 3779 continues to apply to any remaining portions of Crown Land.

4 DECISION NO WAT-004(a) Page 4 I am not planning to undertake any further review on this matter. If you still feel that the validity of PCL 3779 is questionable, I suggest that you have this matter interpreted by the courts. 4. Authority for transmission line corridor through District Lot 972 The PCL 3779 gives authority to BC Hydro to occupy portions of Crown Land along the transmission line corridor from the FRGS [Falls River Generating Station] to Prince Rupert. It is not clear what authority BC Hydro now has for the portion of transmission line across District Lot 972. This is something you will have to discuss with BC Hydro directly. In this respect we have already notified BC Hydro that they may want to contact you to clarify the required authority. You may also want to consult with the agency that issued the Crown grant, presently the Ministry of Agriculture and Lands. 1 [22] Dissatisfied with this response, on January 15, 2008, Fishstriker wrote a 17 page letter to the Deputy Comptroller specifically asking him to terminate Permit Fishstriker points out that none of the water licences for the project specifically included the transmission line as part of the approved works. It states: All the information indicates that the transmission line from FRGS [Falls River Generating Station] to Prince Rupert was not authorized as works by the Comptroller of Water Rights. As the Water Act in force since 1939 has required that a PCL [permit to occupy Crown land] may be granted only for works authorized under a water licence, PCL 2075 issued in 1941 and PCL 3779, which superceded PCL 2075 in 1953 are invalid. [23] Fishstriker also states: The Minister of Lands included in the Certificate [the 1929 Certificate of Approval of Undertaking] a condition that every water licence issued from the application of 1929 for FRGS should expire in fifty years from the date the licence was issued. As this condition was not deleted, the licence expired in PCL 3779 includes a condition that it expires if the Licence terminated. [24] On March 28, 2008, the Deputy Comptroller replied to Fishstriker stating simply that I have not changed my position from what I have written to you in my earlier letters dated August 20 and November 27, It now appears that you may have to follow a course of action either through the courts or the Office of the Ombudsman to have your concerns addressed. [25] On April 24, 2008, Fishstriker appealed the Deputy Comptroller s decision refusing to terminate Permit 3779, and asked the Board to terminate Permit Fishstriker wrote to the Deputy Minister of the Ministry of Agriculture and Lands on January 14, 2008.

5 DECISION NO WAT-004(a) Page 5 Fishstriker submits that the Board has jurisdiction over its appeal and the remedy sought. [26] Both the Deputy Comptroller and BC Hydro submit that the Board does not have jurisdiction, and the appeal should be dismissed. RELEVANT LEGISLATION [27] The following section of the Water Act identifies the categories of people that have standing to appeal certain decisions under the Water Act, as well as the Board s powers on an appeal. Appeals to Environmental Appeal Board 92 (1) Subject to subsections (2) and (3), an order of the comptroller, the regional water manager or an engineer may be appealed to the appeal board by ISSUES (a) the person who is subject to the order, (b) an owner whose land is or is likely to be physically affected by the order, or (c) a licensee, riparian owner or applicant for a licence who considers that their rights are or will be prejudiced by the order. (8) On an appeal, the appeal board may (a) send the matter back to the comptroller, regional water manager or engineer, with directions, (b) confirm, reverse or vary the order being appealed, or (c) make any order that the person whose order is appealed could have made, and that the board considers appropriate in the circumstances. [28] The issue to be determined is whether the Board has jurisdiction over the appeal and the authority to issue the remedy sought. DISCUSSION AND ANALYSIS [29] Fishstriker, the Deputy Comptroller and BC Hydro all made extensive and thorough submissions to the Board on this jurisdictional issue. A significant portion of those submissions, however, address the merits of the appeal and the question of whether there has ever been a legal basis for the permits allowing the transmission line to occupy Crown land. Fishstriker, in particular, has performed a great deal of research and provides a detailed legal and factual basis in support of

6 DECISION NO WAT-004(a) Page 6 its claim that the legal basis for the transmission line right of way in Permit 3779, and its predecessor permits, is flawed. Similarly, the Deputy Comptroller provided a detailed background and detailed arguments to establish a legal and factual basis in support of its position that Permit 3779, and its predecessor permits, are valid authority for the transmission line right of way on Crown land. [30] Fishstriker does not dispute that the Water Act allows, and has previously allowed, permits to be granted to occupy and access Crown land. It disputes, however, whether the permits issued in this case could properly, or legally, relate to the transmission line given that the transmission line was not expressly authorized or referenced in the water licences. Although the most recent permit, Permit 3779, was issued many years ago, Fishstriker submits that the Deputy Comptroller, and this Board, must be able to rescind or terminate a decision that was made without legal authority, regardless of when that occurred. [31] Although the parties are clearly ready to have the merits of their respective positions decided, the Panel finds that it lacks jurisdiction over the appeal. [32] There is no question that the Board does not have jurisdiction to hear an appeal of the issuance of the permits or water licences referenced in the submissions. They were all issued many years ago when there was either no right of appeal, or there was a 30 day appeal period. Any right of appeal for those decisions has long since expired. [33] The appeal in this case is against the Deputy Comptroller s refusal to terminate Permit Fishstriker argues that the Deputy Comptroller must have the authority to terminate a permit that was issued without legal authority and/or is invalid. It argues that its land is physically affected by the decision as the transmission lines are on its property, and that the Board has the power to remedy the situation as it may make any order that the person whose order is appealed could have made, and that the board considers appropriate in the circumstances. [34] While the Panel agrees that Fishstriker s land has been affected by the presence of the transmission line, the Panel finds that the land cannot be said to be affected by the order which it seeks to appeal. Rather, the land was affected by an order made many years ago, i.e., the many permits to occupy Crown land that have been issued since Assuming for the purposes of this preliminary issue that the termination of Permit 3779 would have any impact on Fishstriker s private land (it is a permit to occupy Crown land), at most the Deputy Comptroller s decision preserves the status quo. [35] In the Panel s view, the purpose of the appeal provision in the Water Act is not to address this situation. The appeal provision was placed in the legislation to provide certain identified people with an avenue to appeal a decision that would, or would likely, have some new impact on their existing rights whether those rights relate to an existing licence, an application for a licence, their property rights, or some other right recognized by the Water Act. The right of appeal is not there for the purposes of curing or adjudicating previous decisions that were not appealed. That would effectively circumvent the 30-day time frame for filing an appeal. The present case is an extreme example of that, as it is an attempt to address a perceived injustice that predates Fishstriker s ownership of the land.

7 DECISION NO WAT-004(a) Page 7 [36] Accordingly, the Panel finds the decision which Fishstriker seeks to appeal is not a decision that will have a physical affect on Fishstriker s property and, therefore, pursuant to section 92 of the Water Act, the Board has no jurisdiction over it. Whether Fishstriker is correct that Permit 3779 cannot be the legal authority for the transmission line right of way on either Crown or private land, is not a matter within the Board s jurisdiction. As stated by the Deputy Comptroller, the legal authority for BC Hydro s transmission line on Fishstriker s property is a matter for negotiation amongst the parties, or a question for the courts to decide. [37] Finally, the Panel notes that Fishstriker modified its requested remedy in a letter to the Board dated June 9, It states: The Appellant has asked the Respondent, and is asking the Board to determine the PCL 3779 is not in compliance with the Water Act as the works on the Crown land specified in PCL 3779 are not authorized under a water licence, and PLC 3779 are not authorized under a water licence, and PLC 3779 terminated when CWL 3779 [should be CWL 10186] expired in [38] It appears from this paragraph that Fishstriker is asking the Board to consider Permit 3779 and declare that the permit does not provide authority for the transmission line. That remedy is more in the nature of a declaration which is not a power the Board has been given under the Water Act. [39] The Panel notes that there are serious issues raised by Fishstriker s appeal, however, the Panel does not have the jurisdiction under the Water Act to address and resolve the issues raised. DECISION [40] In making this decision, the Panel has considered all of the evidence and submissions before it, whether or not specifically reiterated herein. [41] For all of the reasons set out above, the Panel finds that the appeal is dismissed for lack of jurisdiction. Alan Andison Alan Andison, Chair Environmental Appeal Board August 14, 2008