The Ontario government has agreed to pay out $20 million to residents and business owners who suffered through the aboriginal protest at a housing development in Caledonia but the centuries old land claim that began the stand-off in the first place still isn’t resolved.

Ontario Attorney General Chris Bentley denied that the settlement to a lawsuit reached on Friday was a pre-election move on behalf of the Liberal government.

“You know, these things sort of have a life of their own,” Bentley said. “When litigation started, you don’t always know what kind of path it will take, know how long it will take or whether a resolution will be possible.”

Tensions peaked in February 2006, after residents of the nearby Six Nations Confederacy reserve moved onto a 40-hectare subdivision called Douglas Creek Estates in Caledonia, near Hamilton.

First Nations protestors called it a “reclamation” and claimed aboriginal title over the land, then owned by a private developer, Henco Industries Ltd.

Caledonia residents often used the term “illegal occupation.”

The often-ugly dispute soon halted work on the subdivision.

The lawsuit represents some 440 homeowners and 200 businesses. Filed five years ago, it alleged that the Ontario Provincial Police failed to provide required services to the people of Caledonia.

Bentley said he moved to settle the lawsuit because he didn’t want to tie up the courts and run up even more costs.

“This is a settlement that provides compensation for the members of the class who were residents and business owners caught up in a situation that involves other jurisdictional issues,” he said. “The underlying issue, the land claim hasn’t been resolved by the lawsuit.”

The settlement doesn’t mean that the government and the OPP didn’t do their jobs handling the dispute at the Douglas Creek housing development, he said.

“Let’s not pretend there are easy answers and solutions to challenging claims like this,” Bentley said. “We have a land claim a couple of centuries in the making and there are a number of people who have offered easy, five minute solutions, we saw in a place not far from me when some of those easy solutions are tried,” he said.

As a province, the Liberals are trying to move ahead with land claims but they need “very active participation from the federal government,” he said.

Meanwhile, Toby Barrett, the Conservative MPP for the area, said the move to settle the lawsuit smacks of desperation before the Oct. 6 election.

“It does suggest some desperation and some panic,” Barrett said, adding that he favours tougher law enforcement and expanding powers of trespassing laws.

It marked one of the few times a class action suit against the government was allowed to proceed in the courts.

Named as defendants in the lawsuit were the OPP and Her Majesty the Queen (by way of the Ontario government), former OPP Commissioner Gwen Boniface and Insp. Brian Haggith, commander of the Caledonia detachment.

The settlement was approved on Friday by Superior Court Judge David Crane.

In their lawsuit, residents complained that the protest completely closed major arteries of commerce like Highway 6 for six weeks, shutting down the local economy.

Protesters burned a railway bridge, pushed a vehicle onto a road and temporarily closed Hydro One’s Caledonia transformer station.

Residents also alleged they suffered from continual loud noises and threats.

Tracy Bomberry of the Six Nations Confederacy said it’s important to remember that people from her community suffered as well throughout the dispute through power outages, transportation hassles, missed days at work and racial tensions.

A big reason for the business drop in Caledonia is that Six Nations residents stopped shopping there because of the tensions they felt in the community, she said.

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“That’s why the majority of people stopped shopping there,” Bomberry said.

She said the government failure to address land claims hurts First Nations people as well.

“Where’s our settlement?,” Bomberry said on Friday. “There’s not even any negotiations going on.”

The province earlier paid $15.8 million for the former Douglas Creek Estates.

There was also an out-of-court settlement between the Ontario government and a Caledonia couple, Dana Chatwell and Dave Brown, who lived by the former housing development and sued the province and OPP for $7 million.

Haldimand County Mayor Ken Hewitt called the settlement great news for residents of Caledonia.

Hewitt sharply criticized police for not removing protestors from the former development site, and said the settlement was an obvious admission of negligence by the province.

He said land claim disputes can’t be allowed to fester and stymie business.

“Caledonia was one of the fastest growing communities in the province,” Hewitt said. “Our growth rate has come to a complete halt in the last five years.”

Barrett said attempts at negotiating land claims have proved frustrating.

“There have been lots of talks,” Barrett said, “Lots of talks and lots of failures in the negotiation front.”

Mark Vandermaas said news of the settlement moved him to tears.

The ex-member of the Canadian Forces was arrested on Dec. 16, 2006 as he tried to put up a Canadian flag across the street from the occupation site.

“This is a special day,” Vandermaas said. “This proves the system works and people can fight back.”

However, this is only partial vindication, he said. “Now we have to ask – how did it all go wrong?”