Canadian Forest Products Ltd. v. Government of British Columbia.

This is a statutory appeal from a decision of the Forest Appeals Commission. The decision under appeal affirmed a reappraisal of the stumpage rate for a cutting permit issued to Canadian Forest Products Ltd. (“Canfor”). The appellant submits that the Commission erred in the interpretation of certain provisions of the Forest Act, R.S.B.C. 1996, c. 157, relating to the assessment of stumpage rates. It argued that section 2.4.1 of the IAM is ultra vires the Forest Act because it conflicts with section 103(1) of the Act by permitting the retroactive application of a reappraised stumpage rate to timber that has already been harvested and scaled. The Court allowed Canfor’s appeal. The Court first considered the standard of review that applied to the Commission’s decision. The Court applied the test set out in Dunsmuir v. New Brunswick, 2008 SCC 9, and found that the standard of correctness applies when reviewing pure questions of law. The Court found that the issue in this case was a question of law; namely, the appropriate interpretation of sections 103 and 105 of the Forest Act. The Court held that this issue did not directly engage the Commission’s specialized expertise, and therefore, the appropriate standard of review in this case is correctness. The Court found that section 103 (1)(c)(i) of the Forest Act contains a mandatory requirement that the amount of stumpage payable must be calculated based on the rate of stumpage applicable to the timber under section 105 at the time that the timber is scaled. Section 103(1)(c) contemplates the application of stumpage rates only on a prospective basis, to timber that has not yet been scaled. Section 103(1) is not subject to section 105, although it is expressly subject to other sections of the Forest Act. Reading sections 103 and 105 together in the context of the Act, the Court found that the Minister’s power to redetermine stumpage rates under section 105(1) does not authorize the re-opening of completed stumpage assessments under section 103(1). Moreover, the Court held that it is reasonable to assume that the legislature intended some measure of finality to the calculation of stumpage owing under section 103(1), subject to the limited exceptions stated in the Forest Act. The Court held that section 2.4.1(1) of the IAM conflicts with sections 103 and 105 of the Forest Act, in that it purports to allow the Ministry to apply a stumpage reappraisal retroactively to timber that has already been scaled. Consequently, the Court held that section 2.4.1(1) of the IAM is ultra vires the Forest Act, and the Commission erred in finding that there was no conflict between section 103 of the Forest Act and section 2.4.1 of the IAM. In conclusion, the Court ordered that the Commission’s decision was stayed, and the stumpage advisory notice issued by the Timber Pricing Officer was rescinded.