Federal Court has N.S. Band Reconsider its own Decision

What’s Next for Self-Governance and First Nation Band autonomy? It isn’t Completely Clear.

A look at the context, facts and potential implications of the federal court decision with respect to Cheryl Maloney v. Shubenacadie Band 2014 FC 129.


Cheryl Maloney, a member of the Shubenacadie Band (the “Band”), contracted with the Band for licences to fish a quota, which had been granted to the band by the federal government, and which was to be distributed through the band’s discretion. When Ms. Maloney was left out of the Band’s subsequent contracting decisions with respect to a third party and licences – she asked the court for a judicial review of the Band’s decision. The federal court did not overturn the Band’s decision, nor did it offer Ms. Maloney any financial remedies – but found that given that her livelihood was affected by the decision, she had a right to a higher level of procedural fairness. The decision was sent back to the Band for reconsideration, and implementation of a fairer process, in which Ms. Maloney would be more involved with the decision-making process.

The federal court’s decision to reach into decision-making powers, which had been allotted to a Band without material restrictions, touches on the broader issue of a Band’s freedom to self-govern, and potentially widens the grey area through which a court may interrupt the body’s autonomy.

For First Nations Bands, this case sends a message to be more careful when making decisions, and to consider what level of procedural fairness is owed to Band members, or other interested parties. For Band members and others who contract with First Nations Bands, this case may strengthen rights to be involved in the otherwise internal decision-making processes.

The Case 

The Right to Grant Licences

In 2005 the Shubenacadie Band entered into an agreement with the Federal Department of Fisheries and Oceans to take on a certain number of fishing licenses, under the authority of section 4 of the Aboriginal Communal Fishing Licences Regulations, SOR/93-332. The right for First Nations to take part in a communal fishery to earn a moderate living, or assign an interest to do so, is recognized thanks to the Supreme Court of Canada decision of R v. Marshall, [1999] 3 SCR 456 [Marshall].

For the licences issued under these Regulations, the Band is allocated quota. Quota refers to the amount of a certain fish that is permitted to be caught under the entire fishery – a portion of which is then allocated to each individual licence. Quota is calculated considering the number of licences granted – balancing profitability with the overall concern of conservation. Pursuant to the Regulations, the Band, as a designated “aboriginal organization” was given the authority by the Minister, to allocate licences. The Minister left it to the Band to designate the individuals and vessels authorized to fish under the licences.

Over the years, the Band created its own policies and business deals with respect to its allocated licences.

Cheryl Maloney’s Contract for Quota

Cheryl Maloney, a Shubenacadie Band Member, successfully took out a loan to finance a fishing boat, and was fishing the Band’s entire quota in 2009, 2010 and 2012, partnering with another licensee for 2011.

In 2012, the Band exercised its authority to allocate licences again, entering into an agreement with a non-aboriginal fishing enterprise, which agreed to pay the Band the shore price (less fishing costs) in exchange for the Band’s snow crab fishing quote for 2013 and 2014.

This decision of the Band triggered Ms. Maloney’s application to the federal court, in which she asked for the court to review the Band’s decision, and delve into whether it had authority to allocate its fishing licence and quota to a non-Aboriginal fishing enterprise – to the exclusion of a similarly-situated fishing enterprise, led by a Band member.

What makes the Band Council’s decision a subject of review by the Federal Court?

The court undertook a careful consideration of whether the Band, as a decision-making body acting on a regulatory grant of power, was in fact subject to judicial review by the federal court; and undertook a secondary analysis as to the nature of the decision – whether it was a decision of a public nature (which can be judicially reviewed) versus one of a private nature (which cannot).

The decision reviews case law which has shown that some, yet not all decisions of a First Nation Band, are subject to judicial review. In this situation, much of the case law pertaining to grants of power made pursuant to the Indian Act were found to be not directly applicable – yet helpful when used in the analogy – as this grant of power was made pursuant to the Regulations of the Fisheries Act.  Ultimately the court found that the decision was one of the Band council, under the power of a grant of authority provided by regulation – and therefore subject to judicial review.

Despite the First Nation’s assertion that its relationship with Ms. Maloney was purely contractual and therefore private/not subject to judicial review, the court found it to be of a sufficiently public matter, and therefore subject to review.

Was Ms. Maloney treated fairly?

The second part of the analysis was to determine whether Ms. Maloney was entitled to any level of involvement in the decision-making process, and/or notice, etc., throughout the process. In other words, what rights did Ms. Maloney have to be kept abreast, and maybe even partake in, the band’s decision?

In determining what level of procedural fairness (on a scale from minimal to great) the court considered, among other factors, that the decision had implications on Ms. Maloney’s livelihood – raising the bar for procedural fairness owed. The importance of her livelihood as a factor in this analysis was not lessened by the fact that she had another source of income. The level of fairness owed to Ms. Maloney was elevated by the fact that it had been represented by the Band that she would have access to the communal fishery for a certain period; and because she relied on the contract for financing of her boat – a fact which was known to the Band. Other facts surrounding the understanding between Ms. Maloney and the band also contributed to the elevated level of procedural fairness owed.

Ultimately, it was found that Ms. Maloney’s rights to procedural fairness were violated by the Band’s decision-making process. The decision was put back to the band to be re-determined, with the opportunity to be afforded to Ms. Maloney (and the other party involved) to submit proposals and have a discourse with the Band about its concerns about her financial performance.

What does this mean for First Nations governments?

The application of a Federal Court decision, with respect to band governance, has national effects. This means that a federal court decision regarding a Band in British Columbia, could potentially have a direct influence on an issue in Nova Scotia – and vice versa. The decision also, naturally affects other Bands in this region.  The court’s decision to reach into the governance structure, and direct the First Nation’s decision-making abilities could have vast consequences for the perceived and desired autonomy and self-governance enjoyed by First Nations across the country. While the Federal Court did not dictate the proper outcome to be reached in this decision, it did send a strong message by disagreeing with the procedure used to reach the ultimate decision, forcing the First Nation go back to the drawing board.

Contact Natalie at 902.240.4080 or by email at natalie@cslegal.ca.

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