PRB 99-8E
THE NANOOSE BAY
TEST RANGE:
OWNERSHIP AND EXPROPRIATION
Prepared by:
Mollie Dunsmuir
Law and Government Division
22 June 1999
TABLE
OF CONTENTS
BACKGROUND
OWNERSHIP
OF THE SEABED
THE
TREATIES
THE
LICENCE OF OCCUPATION
EXPROPRIATION
OF THE SEABED
APPENDICES
THE NANOOSE BAY
TEST RANGE:
OWNERSHIP AND EXPROPRIATION
BACKGROUND
In 1965, Canada and the
United States agreed upon the establishment, operation and maintenance
of a torpedo test range at Nanoose Bay in the Strait of Georgia, to be
more formally known as the Canadian Forces Maritime Experimental and Test
Ranges (CFMETR).(1) The land
for the base at Nanoose Bay had been expropriated by the federal government
in 1951. The foreshore was transferred to Canada by British Columbia in
1988, for military use over a period of 60 years.(2)
In 1984, the Supreme Court
of Canada found that several straits on the west coast of British Columbia,
including the Strait of Georgia, had been included in the pre-Confederation
boundaries of British Columbia. Therefore, the Province of British Columbia
still had ownership of the seabed of the Strait, notwithstanding an earlier
Supreme Court of Canada decision that the boundaries of British Columbia,
with respect to the territorial sea, ended at the low water mark.
On 5 September 1989, the
federal and provincial governments signed a ten-year "licence of
occupation" under the British Columbia Land Act. In May 1997,
the British Columbia government gave notice that it would terminate the
licence, because it was not satisfied with the progress of Canada-U.S.
negotiations on the Pacific Salmon Treaty.(3)
Discussions with the federal government followed, but these appear to
have collapsed in mid-May 1999. On 14 May 1999, the government of Canada
announced that it had begun the process of expropriating the seabed at
CFMETR.
The Minister of National
Defence explained the expropriation as follows:
The Government of Canada
cannot permit itself to be put in breach of its international obligations.
As such I have reluctantly asked the Minister of Public Works and Government
Services to initiate the process of expropriation [to ensure that there
is no disruption of operations when the current licence expires on September
4, 1999]. I have done this because CFMETR is important to the national
security of Canada, significant to the economic well-being of the local
communities in the Nanaimo area, and essential to Canadas ability
to fulfil our defence commitments at home and abroad.(4)
The Notice of Intention
to Expropriate says simply that the lands are required "for a purpose
related to the safety and security of Canada or of a state allied or associated
with Canada and it would not be in the public interest further to indicate
that purpose."(5)
British Columbia responded
by condemning "the first hostile expropriation of provincial land
by Ottawa in recent history."(6)
OWNERSHIP
OF THE SEABED
In 1967, the Supreme Court
of Canada considered a reference to determine whether the seabed within
the three-mile limit of the west coast territorial sea, and the associated
mineral resources, were owned by the Province of British Columbia or Canada.(7)
Although the case dealt specifically with the British Columbia offshore,
it is widely acknowledged to have established the precedent for the ownership
of offshore resources on both coasts. The Supreme Court held that Canada
had both jurisdiction over and property rights in the territorial sea,
from the low-water mark of the province to the territorial boundary recognized
by international law.(8)
The Supreme Court found
that the pre-Confederation colonies had never gained sovereignty over,
or property rights in, the territorial sea. The territorial sea had therefore
been outside the boundaries of British Columbia at Confederation, and
those boundaries had not been extended since. Canada was the sovereign
state having the rights over the offshore recognized by international
law, such as the 1958 Geneva Convention.
In 1984, a more specific
question was placed before the Supreme Court in Re Strait of Georgia.(9)
Without challenging the general principle set forth in Offshore Minerals,
British Columbia claimed that the historical documentation surrounding
the establishment of the province proved that certain bodies of water,
and the seabed beneath them, had in fact been within the boundaries of
the province at Confederation, and were therefore still the property of
the province. The question put to the Supreme Court of Canada was:
Are
the lands or any part or parts thereof including the mineral and other
natural resources of the seabed and subsoil, covered by the waters of
the Strait of Juan de Fuca, the Strait of Georgia (sometimes called
the Gulf of Georgia), Johnstone Strait and Queen Charlotte Strait (bounded
on the south by the international boundary between Canada and the United
States of America, on the west by a line from Tatoosh Island lighthouse
to Bonilla Point reference mark and on the north by a straight line
drawn across Queen Charlotte Strait from Greeting Point on Nigei Island
to McEwan Point on Bramham Island) the property of the Queen in Right
of the Province of British Columbia?(10)
Dickson J. summarized the
issue before the court:
In the 1967 Off-shore Reference
this court applied the reasoning in Keyn [an 1876 British case
standing for the proposition that the realm of England extended only
to the low-water mark, and all beyond was the high seas] to the territorial
sea surrounding British Columbia. It held that though immediately prior
to Confederation this three-mile strip might well have been "British
territory," the Imperial Parliament had done nothing to extend
the boundaries of British Columbia to include this strip, and therefore
the normal assumptions should prevail, namely, that the territory of
the colony just prior to Confederation ended at the low-water mark...
In order to succeed in
the present Reference, therefore, British Columbia must demonstrate
that prior to Confederation either the lands and waters in question
were "within the realm" as the term is used in The Queen
v. Keyn or else that by some overt act Britain incorporated
them into the territory of the Colony of British Columbia so as to displace
the "normal assumption" cited in the 1967 Offshore Reference...
If [British Columbia]
cannot make good on either claim, then the lands and waters were not
within the province at Confederation, the United Kingdom retained them
between 1871 and the period (1919-1931) during which Canada acquired
sovereign status and succeeded to the rights of the United Kingdom.(11)
The Supreme Court found
that the historical documentation, and in particular the 1866 Imperial
Act for the Union of the Colony of Vancouver Island with the Colony
of British Columbia had incorporated the straits in question within
the boundaries of the colony of British Columbia, and that they therefore
continued to be within the boundaries of the Province of British Columbia
after Confederation. The western boundary of first the colony and then
the Province of British Columbia was the "Pacific Ocean," meaning
the open Pacific, "thus making the western boundary of the United
Colony the coastline formed by the several islands off the coast of British
Columbia, including Vancouver Island."(12)
The straits at issue were within the boundaries of British Columbia, and
therefore the seabed and subsoil of those straits were the property of
the province.
THE
TREATIES
The original treaty establishing
CFMETR(13) provided that
the United States would be responsible for the supply, installation and
maintenance of the technical equipment required for the operation of the
new torpedo testing range. It also provided that the United States would
retain ownership of all removable property it brought into or purchased
in Canada and placed on the site, including structures that could be readily
dismantled. The agreement was for a ten-year period, but was then to remain
in force until it was terminated by mutual agreement or by either partys
giving 12 months written notice to the other.
Although the agreement continued
until terminated, it was renewed by an exchange of notes in 1976(14)
because the United States wished to update existing range equipment and
to install an advanced underwater acoustic measurement system at Jarvis
Inlet. Renewing the treaty at that time allowed the parties to make the
necessary minor changes to the annex. In 1986, the treaty was again renewed
for ten years, by an exchange of notes, to allow for long-term planning
and commitment of resources.(15)
In 1996, no renewal took place because of Canadas requirement for
an environmental clause to be added. In March 1998, however, the United
States accepted a text proposed by Canada for the incorporation of environmental
protocols that would be referenced by the international agreement.(16)
Press reports suggest that
the value of the equipment involved in the torpedo testing facility is
considerable:
The B.C. lease on the
sea floor beneath Nanoose Bay on Vancouver Island allows the testing
facility to deploy 30 underwater arrays -- metal towers measuring about
15 metres in height, each with four three-metre-long arms equipped with
sophisticated hydrophones.
These arrays track submarine
torpedoes, and monitor the movements of vessels. Canadian military aircraft
and helicopters involved in marine defence manoeuvres also use the Nanoose
range.(17)
The B.C. lease does not
include the federally owned onshore facilities or actual waters at the
Nanoose testing range. But the ocean floor is studded with $100 million
worth of test equipment, and cutting off use of the sea-bed would seriously
interfere with the naval operations.(18)
THE
LICENCE OF OCCUPATION
In 1989, the federal and
provincial government signed a "licence of occupation" under
the provincial Land Act.(19)
Although the Land Act defines "Crown land" as "land,
whether or not it is covered by water," the federal-provincial agreement
is clearly based on precedents that involved land, rather than a seabed.
For example, it provides for written notice to be given to the licensee
by "posting the same in a conspicuous place on the Land."
Article 6 of the agreement
allows the province to cancel the licence of occupation on 90 days
written notice, in certain circumstances, which include:
6.01(a) the Owner [the
province] requires the Land for his own use or in his sole discretion
considers that it is in the public interest to cancel the rights herein
granted, in whole or in part...
(c) the Owner, in his
sole discretion, considers that it is no longer necessary for the Licensee
to use the Land for purposes permitted therein.
This provincial discretion
to cancel is so broad that it is difficult to know how it would be interpreted.
The Backgrounder to the press release from the Premiers office
announcing the cancellation of the lease on 23 May 1999(20)
refers to the fact that the agreement "provides for cancellation
at the sole discretion of the Province of British Columbia when the Province
considers that it is no longer necessary for the licensee to use the seabed."
Arguably, it is inappropriate for a provincial government to decide unilaterally
that the federal government no longer needs a seabed supporting defence
structures crucial to an international treaty obligation.
The Backgrounder
also clearly states that "British Columbia is cancelling the Licence
of Occupation for the Nanoose torpedo range in response to the American
failure to cooperate with Canadians over West Coast fishing issues."
This suggests that the province is taking over the responsibility for
defining the "public interest" in matters of fisheries and defence
policy.
In August 1997, the Government
of Canada initiated a court challenge in the Superior Court of British
Columbia to prevent an early termination of the agreement with the Government
of British Columbia. Canada argued that:
-
the Provinces
right to cancel the Licence when it "considers that it is within
the public interest" to do so does not extend to public interest
matters within the expertise and exclusive authority of Canada, including
Fisheries, Foreign Affairs and Defence;
By the spring of 1999, with
the natural expiration of the licence of occupation only six months away,
it was evident that its cancellation, and the subsequent court case, were
increasingly irrelevant to the final outcome of the issue. On 5 May 1999,
the negotiators for the two parties signed a "without prejudice"
document called Points of Principle,(21)
which commenced:
The following represent
the best efforts of the two negotiators to arrive at points of principle
concerning an amended licence of occupation for the Whiskey Golf Test
Range.
The negotiators will recommend
an amended licence based on these principles. It is recognized that
certain policy issues have yet to be resolved before either party commits
to enter into an amended licence arrangement.
The term of the amended
agreement shall be 40 years (30 additional years).
2. The fees for the additional
30 years shall be based on an annual payment of $4 million; plus a one-time
payment of $5 million as an adjustment for the 89-99 period, payable
on the date of signing of this amended licence...
Point 7 provided
that "an environmental schedule ... will include a provision confirming
that no nuclear warheads will be present at any time within the licence
area."
The Department of National
Defence claims that negotiations reached an impasse by 10 May 1999, after
the government of British Columbia introduced "fisheries issues unrelated
to the operations of CFMETR."(22)
On the other hand, British Columbias Minister of Intergovernmental
Relations claimed that the negotiations collapsed because the federal
government "backed away" from the Points of Principle,
and "wouldnt prohibit nuclear warheads."(23)
In any case, on 21 May 1999 the Minister of Public
Works and Government Services issued a Notice of Intention to Expropriate
on behalf of Canada. On 13 September 1999, after a summer of contentious
public hearings on the issue, the same Minister confirmed the expropriation,
offering less than $2 million compensation instead of the total of $125
million compensation referred to in the Points of Principle. British
Columbia has launched a constitutional challenge against the expropriation.(24)
EXPROPRIATION
OF THE SEABED
Generally speaking, the
federal government can expropriate provincially owned property, provided
it does so for a valid federal purpose. Peter Hogg notes that "federal
legislative power will extend to bind the Crown in right of a province,
and there have been cases in which the federal Parliament has validly
expropriated provincial Crown property,"(25)
and refers to several cases where this proposition has been upheld.
It should be noted, however,
that the courts are inclined to place strict limitations upon the federal
power of expropriation. Two of the cases cited by Professor Hogg are railway
cases from the first quarter of the century. The third, Re Exported
Natural Gas Tax, dealt with the taxation of provincial property, rather
than its expropriation. The question of the federal expropriating power
was raised during argument, however, and the majority of the court held
that the federal power to expropriate provincial property extended only
to "the property absolutely essential to the Dominion undertaking":
One has to bear in mind,
however, in dealing with the arrogation of property rights by federal
authority in the exercise of some right, that, whatever the terminology
may be, it is only such part of the property right and such extent of
the taking of that right, as may be tied inherently and of necessity
to the exercise of the authority in question by the federal level of
government that the Constitution will permit.(26)
On the other hand, international
defence treaties would seem to be at the very core of federal jurisdiction
and in Re Strait of Georgia the Supreme Court of Canada
took pains to point out that the provincial powers of ownership of the
seabed are limited:
It is important
to note that the question raised in this reference is not concerned
with legislative jurisdiction nor with political or economic considerations.
No question arises as to the power of Parliament to legislate in relation
to matters within its exclusive legislative jurisdiction as, for example,
control over shipping, navigation, trade and commerce, customs, fisheries
and defence. The sole question here is the matter of proprietorship
in lands.(27) [italics
added]
Perhaps the only safe conclusion
to be drawn with respect to the intended expropriation of the CFMETR seabed
is that such action appears both legally justifiable and politically controversial.
APPENDICES
-
Map
-
The Licence
-
Points of Principle
-
Statement of
Claim
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(1)
See Appendix 1 for the location of the range.
(2)
"B.C. Ends Seabed Lease for Nanoose Torpedo Range in Response to
U.S. Intransigence on Salmon Talks," Backgrounder, press release
from the office of the Premier of British Columbia, 23 May 1997.
(3)
"We have taken this step in the public interest because we
have been disturbed and frustrated by the unco-operative and unfriendly
approach taken by the United States in our efforts to negotiate new terms
for the Pacific Salmon Treaty, said Premier Glen Clark," press
release, see note 2.
(4)
"Government of Canada Begins Expropriation Process to Retain Seabed
Testing Site at Nanoose Bay," Department of National Defence, press
release, 14 May 1999.
(5)
Canada Gazette, Part I, 22 May 1999, 1503.
(6)
"Backgrounder," Intergovernmental Relations: Nanoose Bay
Expropriation website,
http://www.nanoose.gov.bc.ca/backgrounder.html,
accessed June 1999.
(7)
Reference re Offshore Mineral Rights (B.C.), [1967] S.C.R. 792,
65 D.L.R. (2d) 353.
(8)
In 1967, international law recognized a three mile wide territorial sea.
(9)
[1984] 1 S.C.R. 388, 8 D.L.R. (4th) 161.
(10)
See note 9, 8 D.L.R. (4th) 161, at p. 165.
(11)
See note 9, 8 D.L.R. (4th) 161, at p. 172.
(12)
See note 9, 8 D.L.R. (4th) 161, at p. 191.
(13)
Treaty Series 1965 No. 6.
(14)
Treaty Series 1976 No. 18.
(15)
Treaty Series 1986 No. 40.
(16)
This agreement was conveyed by means of a Diplomatic Note from the United
States on 13 March 1998. See "Chronology of Events: Canadian Forces
Maritime Experimental Test Ranges (CFMETR)," Department of National
Defence press release, 14 May 1999.
(17)
Larry Pynn, "B.C.s Threat to End Lease Could Cost U.S. Millions,"
Vancouver Sun, 23 May 1997, p. A1.
(18)
Ross Howard, "B.C. Cancels Military Lease," The Globe and
Mail (Toronto), 23 May 1997, p. A1.
(19)
See Appendix 2 for the Lease of Occupation.
(20)
See note 2, above.
(21)
Intergovernmental Relations: Nanoose Bay Expropriation website,
http://www.nanoose.gov.bc.ca/backgrounder.html,
accessed June 1999; See Appendix 3 for the "Points of Principle."
(22)
"Chronology of Events: Canadian Forces Maritime Experimental Test
Ranges (CFMETR)," Department of National Defence press release, 14
May 1999.
(23)
Andrew Petter, "Nanoose Expropriation: An Unprecedented Abuse of
Federal Power," Victoria Times Colonist, 25 May 1999, A11.
(24) See
Appendix 4 for the Statement of Claim.
(25)
Section 28.5(c), Constitutional Law of Canada (Looseleaf edition).
(26)
[1982] 1 S.C.R. 1004, at p. 1052-3).
(27)
See note 9, above, 8 D.L.R.(4th) 161, at 166.
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