Federal Court - Christian Aboriginal Infrastructure Developments ...

Federal Court - Christian Aboriginal Infrastructure Developments ... Federal Court - Christian Aboriginal Infrastructure Developments ...

22.01.2015 Views

Page: 296 (13) phases, timing and financing of the project phases; and (14) benefits of co-generation. [1118] In my opinion some of these terms are essential. However, I do not accept the Defendant’s argument that these terms are all essential. I refer to the fact that the existing contract with KFR did not adequately address many of the terms that the Defendant now argues are essential; see Exhibit 2010 FC 495 (CanLII) P-80, Tab 35. [1119] In my opinion, many of these terms are desirable for the Department, but there is no evidence that they would be necessary, for example, the level of First Nations involvement and the number of jobs to be created. [1120] I have found that the commitment made by the Defendant to the Plaintiffs included an implied representation to provide a long-term adequate volume of timber to whoever built a mill. [1121] The Defendant knew that the Plaintiffs required 200,000 m 3 per annum to operate the mill on an economically sound basis. Mr. Sewell, the Defendant’s representative, acknowledged that the Department knew that the volume required was 200,000 m 3 . There is no uncertainty with respect to volume. [1122] I find that it was an implied term of the unilateral contract that the annual volume of timber under the agreement was 200,000 m 3 .

Page: 297 [1123] With respect to the duration of the agreement, the implied representation of a long-term adequate supply was for a 20 year supply. [1124] Mr. Sewell’s evidence was that a THA had been “around” since the 1960s and had been assigned to various enterprises before its assignment to KFR. 2010 FC 495 (CanLII) [1125] Exhibit P-80, Tab 26, an internal DIAND document, stated that the THA which was assigned to KFR in 1992, was signed in 1979. It also stated that the KFR THA would expire in 1999. The KFR THA confirms the Department’s prior conduct of granting THAs of a 20 year duration. [1126] I also refer to the context that was prevailing in southeast Yukon when LPL “came on the scene” in 1996. At this time, as I have recounted earlier, regulatory changes concerning access to timber were in contemplation and underway. The Department was seriously concerned about the failure of KFR to build a mill, which was a condition for the assignment of the THA to KFR in the first place. The time was right to encourage private industry to come in and build a mill. Such encouragement was extended to LPL and later, to SYFC. [1127] The evidence of Mr. Sewell, at page 4128 of the transcript, was that long-term tenure was necessary for future economic development.

Page: 296<br />

(13) phases, timing and financing of the project phases; and<br />

(14) benefits of co-generation.<br />

[1118] In my opinion some of these terms are essential. However, I do not accept the Defendant’s<br />

argument that these terms are all essential. I refer to the fact that the existing contract with KFR did<br />

not adequately address many of the terms that the Defendant now argues are essential; see Exhibit<br />

2010 FC 495 (CanLII)<br />

P-80, Tab 35.<br />

[1119] In my opinion, many of these terms are desirable for the Department, but there is no<br />

evidence that they would be necessary, for example, the level of First Nations involvement and the<br />

number of jobs to be created.<br />

[1120] I have found that the commitment made by the Defendant to the Plaintiffs included an<br />

implied representation to provide a long-term adequate volume of timber to whoever built a mill.<br />

[1121] The Defendant knew that the Plaintiffs required 200,000 m 3 per annum to operate the mill<br />

on an economically sound basis. Mr. Sewell, the Defendant’s representative, acknowledged that the<br />

Department knew that the volume required was 200,000 m 3 . There is no uncertainty with respect to<br />

volume.<br />

[1122] I find that it was an implied term of the unilateral contract that the annual volume of timber<br />

under the agreement was 200,000 m 3 .

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