Alberta Court of Appeal tees up an argument for western separation

By Bruce Pardy for the Financial Post

Last week, the Alberta Court of Appeal ruled that the federal Impact Assessment Act is an unconstitutional infringement on provincial powers. In a 121-page judgment, four of the panel’s five judges said Parliament had taken a wrecking ball to the constitutional right of the citizens of Alberta, Saskatchewan, and other provinces to have their natural resources developed for their benefit. The decision championed Canada’s federal system as fundamental to the country’s existence. In so doing, however, and depending on what happens next, it sets up an effective argument for western separation.

The Impact Assessment Act (IAA), passed in 2019 as Bill C-69, replaced the Canadian Environmental Assessment Act 2012 and the National Energy Board Act. In some respects, the new assessment statute resembles the old one. Both embody the idea that environmental assessment is merely process, an empty shell within which governments do as they deem best, ad hoc and case-by-case, without environmental rules, standards, or rights to apply. Environmental assessment provides government with broad discretion to seek the public interest — which they are empowered to conceive in their own self-image.

But C-69 differs from its predecessor in its breadth. Not only does it expand the environmental, social, and economic factors to be taken into account, including gender-based analysis and climate-change accounting, but it also extends the potential reach of the federal process to any project designated by cabinet or the minister of the environment, including projects situated wholly within a province, such as oil sands developments.

The government of Alberta, which referred the case to the court, characterized the IAA as a Trojan horse that effectively gives Ottawa a veto over the development of provincial natural resources, even though section 92 of the constitution reserves “local works and undertakings” to the provinces while section 92A explicitly gives them jurisdiction over natural resources. The majority on the panel agreed with Alberta, finding that the IAA constituted “a breathtaking pre-emption of provincial legislative authority.”

With one key exception that I will turn to momentarily, the court’s decision was logical and well argued. You might think, therefore, that things have now been put right in the federation. Unfortunately, but also predictably, the federal government has indicated it intends to appeal the decision to the Supreme Court of Canada.

We have seen this show before. In February 2020, the Alberta Court of Appeal found the federal carbon tax to be unconstitutional, concluding that Ottawa had no right to encroach upon provincial jurisdiction merely by citing climate change and greenhouse gas emissions as a national concern. The following year, a majority at the Supreme Court overturned that conclusion, instead confirming decisions from the Ontario and Saskatchewan courts of appeal that had held the carbon tax a permissible exercise of the federal government’s residual “peace, order, and good government” power under section 91. According to its judgment, establishing a minimum national carbon tax to reduce greenhouse gas emissions constituted a “national concern” because climate change was “an existential threat to human life in Canada and around the world.” Because provinces, whether acting alone or together, were constitutionally incapable of establishing minimum national carbon pricing standards, provincial inaction would have grave consequences for extra-provincial interests.

When the IAA case arrives before it, the Supreme Court may again uphold the federal government’s encroachment on provincial powers. Yes, a different statute is in question and the legal issues are not exactly the same, but the cases are conceptually similar. Before the Alberta court, the federal government echoed the logic of the carbon tax decision, arguing that resource projects normally under provincial jurisdiction could produce environmental impacts significant enough to amount to a national concern and therefore be a matter over which the federal government could legitimately exercise its authority.

Which brings us to the stumble in the Alberta Court of Appeal judgment. Early on, this sentence appears: “Climate change constitutes an existential threat to Canada.” Ceding this ground gives oxygen to the federal case. The Alberta court, like the courts involved in the carbon tax decisions, treats this assertion as though it is self-evidently true. But it is nothing of the sort, and without a full evidentiary record the court had no reason to reach this categorical conclusion and undermine its own decision.

If the Supreme Court does overturn the Alberta decision and upholds the constitutionality of the IAA, what are western oil-rich provinces to think? The kind of control that Ottawa will have seized through the IAA is quite different from, yet also quite reminiscent of, the National Energy Program of the 1980s. From the time Bill C-69 was introduced, the Trudeau government has signalled its hostility to fossil fuel development, its disdain for the fortunes of western provinces built on fossil fuel production, and its disregard for the autonomy of provinces built into the Constitution.

The Constitution is a deal. If Alberta and Saskatchewan resolved to leave, could anyone blame them?

Bruce Pardy is executive director of Rights Probe, professor of law at Queen’s University, and senior fellow with the Fraser Institute.