The Federal Court of Appeal ruling Thursday that overturned the federal government’s approval of the Kinder Morgan pipeline expansion dealt a major blow to the project, which is now owned by the Canadian government.

The full 254-page judgment is available here.

The Tyee has excerpted key sections below.

[454] By defining the Project not to include Project-related marine shipping, the Board failed to consider its obligations under the Species at Risk Act when it considered the Project’s impact on the Southern resident killer whale. Had it done so, in light of its recommendation that the Project be approved, subsection 79(2) of the Species at Risk Act required the Board to ensure, if the Project was carried out, that “measures are taken to avoid or lessen” the Project’s effects on the Southern resident killer whale and to monitor those measures.

[455] While I recognize the Board could not regulate shipping, it was nonetheless obliged to consider the consequences at law of its inability to “ensure” that measures were taken to ameliorate the Project’s impact on the Southern resident killer whale. However, the Board gave no consideration in its report to the fact that it recommended approval of the Project without any measures being imposed to avoid or lessen the Project’s significant adverse effects upon the Southern resident killer whale.

[456] Because marine shipping was beyond the Board’s regulatory authority, it assessed the effects of marine shipping in the absence of mitigation measures and did not recommend any specific mitigation measures. Instead it encouraged other regulatory authorities “to explore any such initiatives” (report, page 349). While the Board lacked authority to regulate marine shipping, the final decision-maker was not so limited. In my view, in order to substantially comply with section 79 of the Species at Risk Act the Governor in Council [cabinet] required the Board’s exposition of all technically and economically feasible measures that are available to avoid or lessen the Project’s effects on the Southern resident killer whale. Armed with this information the Governor in Council would be in a position to see that, if approved, the Project was not approved until all technically and economically feasible mitigation measures within the authority of the federal government were in place. Without this information the Governor in Council lacked the necessary information to make the decision required of it.

[465] Trans Mountain’s application was complex, raising challenging issues on matters as diverse as Indigenous rights and concerns, pipeline integrity, the fate and behaviours of spilled hydrocarbons in aquatic environments, emergency prevention, preparedness and response, the need for the Project and its economic feasibility and the effects of Project-related shipping activities.

[466] The approval process was long and demanding for all participants; after the hearing the Board was left to review tens of thousands of pages of evidence.

[467] Many aspects of the Board’s report are not challenged in this proceeding.

[468] This said, I have found that the Board erred by unjustifiably excluding Project-related marine shipping from the Project’s definition. While the Board’s assessment of Project-related shipping was adequate for the purpose of informing the Governor in Council about the effects of such shipping on the Southern resident killer whale, the Board’s report was also sufficient to put the Governor in Council on notice that the Board had unjustifiably excluded Project-related shipping from the Project’s definition.

[469] It was this exclusion that permitted the Board to conclude that section 79 of the Species at Risk Act did not apply to its consideration of the effects of Project-related marine shipping. This exclusion then permitted the Board to conclude that, notwithstanding its conclusion that the operation of Project- related marine vessels is likely to result in significant adverse effects to the Southern resident killer whale, the Project (as defined by the Board) was not likely to cause significant adverse environmental effects. The Board could only reach this conclusion by defining the Project not to include Project-related shipping.

[470] The unjustified exclusion of Project-related marine shipping from the definition of the Project thus resulted in successive deficiencies such that the Board’s report was not the kind of “report” that would arm the Governor in Council with the information and assessments it required to make its public interest determination and its decision about environmental effects and their justification. In the language of Gitxaala this resulted in a report so deficient that it could not qualify as a “report” within the meaning of the legislation and it was unreasonable for the Governor in Council to rely upon it.

On Indigenous rights and the duty to consult

[557] However, for the reasons developed below, Canada’s execution of Phase III of the consultation process was unacceptably flawed and fell short of the standard prescribed by the jurisprudence of the Supreme Court. As such, the consultation process fell short of the required mark for reasonable consultation.

[558] To summarize my reasons for this conclusion, Canada was required to do more than receive and understand the concerns of the Indigenous applicants. Canada was required to engage in a considered, meaningful two-way dialogue. Canada’s ability to do so was constrained by the manner in which its representatives on the Crown consultation team implemented their mandate. For the most part, Canada’s representatives limited their mandate to listening to and recording the concerns of the Indigenous applicants and then transmitting those concerns to the decision-makers.

[559] On the whole, the record does not disclose responsive, considered and meaningful dialogue coming back from Canada in response to the concerns expressed by the Indigenous applicants. While there are some examples of responsiveness to concerns, these limited examples are not sufficient to overcome the overall lack of response. The Supreme Court’s jurisprudence repeatedly emphasizes that dialogue must take place and must be a two-way exchange. The Crown is required to do more than to receive and document concerns and complaints. As this Court wrote in Gitxaala, at paragraph 265, speaking of the limited mandate of Canada’s representatives: When the role of Canada’s representatives is seen in this light, it is of no surprise that a number of concerns raised by Aboriginal groups— in our view, concerns very central to their legitimate interests—were left unconsidered and undiscussed. This fell well short of the conduct necessary to meet the duty to consult.

[560] Further, Phase III was to focus on two questions: outstanding concerns about Project-related impacts and any required incremental accommodation measures. Canada’s ability to consult and dialogue on these issues was constrained by two further limitations: first, Canada’s unwillingness to depart from the Board’s findings and recommended conditions so as to genuinely understand the concerns of the Indigenous applicants and then consider and respond to those concerns in a genuine and adequate way; second, Canada’s erroneous view that it was unable to impose additional conditions on Trans Mountain.

[561] Together these three factors led to a consultation process that fell short of the mark and was, as a result, unreasonable. Canada then exacerbated the situation by its late disclosure of its view that the Project did not have a high level of impact on the established and asserted rights of the Indigenous applicants—a disclosure made two weeks before they were required to submit their final response to the consultation process and less than a month before the Governor in Council approved the Project…

[756] However, as the above review shows, missing was a genuine and sustained effort to pursue meaningful, two-way dialogue. Very few responses were provided by Canada’s representatives in the consultation meetings. When a response was provided it was brief, and did not further two-way dialogue. Too often the response was that the consultation team would put the concerns before the decision-makers for consideration.

Court Overturns Kinder Morgan Pipeline Approval read more

[757] Where responses were provided in writing, either in letters or in the Crown Consultation Report or its appendices, the responses were generic. There was no indication that serious consideration was given to whether any of the Board’s findings were unreasonable or wrong. Nor was there any indication that serious consideration was given to amending or supplementing the Board’s recommended conditions.

[758] Canada acknowledged it owed a duty of deep consultation to each Indigenous applicant. More was required of Canada.

[759] The inadequacies of the consultation process flowed from the limited execution of the mandate of the Crown consultation team. Missing was someone representing Canada who could engage interactively. Someone with the confidence of Cabinet who could discuss, at least in principle, required accommodation measures, possible flaws in the Board’s process, findings and recommendations and how those flaws could be addressed.

[760] The inadequacies of the consultation process also flowed from Canada’s unwillingness to meaningfully discuss and consider possible flaws in the Board’s findings and recommendations and its erroneous view that it could not supplement or impose additional conditions on Trans Mountain.