Last year, in Cowichan Tribes v. Canada, a British Columbia court disrupted property rights across Canada by declaring Aboriginal title a 'senior and prior interest' over fee simple ownership. Now, a new lawsuit threatens similar damage to contract law.
Metlakatla First Nation vs. Prince Rupert Port Authority
The case, Metlakatla First Nation v. Prince Rupert Port Authority (PRPA), challenges contracts signed by PRPA, which owns and operates the port at Prince Rupert. In 2015, PRPA entered a development agreement with the Ridley Island Energy Export Facility (REEF) to export propane. REEF negotiated exclusive rights to handle propane, with confidential terms.
In 2018, after five years of talks, REEF agreed to provide $350 million in economic benefits to six First Nations, including Metlakatla, in exchange for consent. The $1.3 billion project received all approvals and is expected to operate next year.
Trigon's Role and Legal Challenge
Separately, in 2019, Ottawa sold Ridley Terminals to Trigon Pacific Partnerships, restricting it to export coal and coke—not propane. Trigon later gave Metlakatla a five percent equity stake and sought to export propane, but PRPA refused due to its REEF contract. Trigon and Metlakatla then launched a campaign to force PRPA to break its contract.
Metlakatla claims PRPA failed to 'adequately consult' on REEF, asserting a fiduciary duty to disclose confidential terms. It also claims Aboriginal title includes a right to export propane as 'derivative economic rights.'
This lawsuit risks undermining contract law and deterring investment in resource projects with First Nations, warns Peter Best in a Financial Post opinion piece.
