Supreme Court


Natural Resources

Timber

Timber licences

Court had no jurisdiction to review arbitrator’s decision in regard to timber licence valuation methodology

Parties entered into Settlement Framework Agreement, but were unable to settle issue of compensation under Forestry Revitalization Act for improvements made by T to land. Arbitration was held in accordance with Forestry Revitalization Act. Arbitrator found on statutory interpretation issue that proper valuation method was depreciation replacement cost method and on contractual interpretation issue that agreement reached by parties prior to arbitration did not exclude interest from province’s payment of compensation to T for improvements. Arbitrator also determined that T was not entitled to compensation for improvements to which it did not lose access. On appeal, application judge upheld arbitrator’s award except in connection with statutory interpretation, which was remitted to arbitrator and resulted in additional award in amount equal to value of improvements. Court of Appeal reversed application judge’s decision concluding that arbitrator erred on both statutory interpretation and contractual interpretation issues as well as subsequent ruling regarding statutory application issue. T appealed. Appeal allowed in part. Arbitrator’s initial valuation predicated on depreciation replacement cost methodology was restored. Arbitrator’s initial ruling that province must pay interest on top of improvements compensation it owed to T was restored. Arbitrator’s initial ruling denying compensation to T for improvements losses pertaining to lillooet licence was restored. Courts had no jurisdiction to review arbitrator’s decision in regard to whether arbitrator correctly applied valuation methodology to licence because it was mixed question. Courts’ jurisdiction was limited to statutory interpretation issue of identifying pool of methodologies consistent with Revitalization Act.

Teal Cedar Products Ltd. v. British Columbia (2017), 2017 CarswellBC 1648, 2017 CarswellBC 1649, 2017 SCC 32, 2017 CSC 32, McLachlin C.J.C., Abella J., Moldaver J., Karakatsanis J., Wagner J., Gascon J., Côté J., Brown J., and Rowe J. (S.C.C.); reversed (2015), 2015 CarswellBC 1550, 2015 BCCA 263, Lowry J.A., Chiasson J.A., and MacKenzie J.A. (B.C. C.A.).

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