Dome Petroleum Ltd. v. Richards and Alberta Power Ltd., (1985) 66 A.R. 245 (QB)

• Court: Court of Queen's Bench of Alberta (Canada)
• Case Date: December 10, 1985
• Citations: (1985), 66 A.R. 245 (QB)

Dome Petroleum Ltd. v. Richards (1985), 66 A.R. 245 (QB)

MLB headnote and full text

Dome Petroleum Ltd. v. Richards and Alberta Power Ltd.

(No. 8304-7183)

Gleason v. Dome Petroleum Ltd.

(No. 8404-7916)

Dzuranuk v. Dome Petroleum Ltd.

(No. 8404-008474)

Gilkyson v. Dome Petroleum Ltd.

(No. 8404-007570)

Fredland v. Dome Petroleum Ltd.

(No. 8304-007439)

Marcovich Bros. Farming Co. Ltd. v. Pancanadian Petroleum Limited

(No. 8404-008919)

Alstad v. Pancanadian Petroleum Limited

(Nos. 8404-007954; 8404-007955)

Congregation of the Most Holy Redeemer and Ross v. Pancanadian Petroleum Limited

(No. 8404-007585)

Wells v. Norcen Energy Resources Ltd.

(No. 8404-008453)

Dika v. Norcen Energy Resources Ltd.

(No. 8404-007924)

Pybus v. Norcen Energy Resources Ltd.

(No. 8404-008121)

Congregation of the Most Holy Redeemer v. Norcen Energy Resources Ltd.

Indexed As: Dome Petroleum Ltd. v. Richards and Alberta Power Ltd.

Alberta Court of Queen's Bench

Judicial District of Grande Prairie

Miller, A.C.J.

December 10, 1985.

Summary:

Twelve appeals from decisions of the Surface Rights Board were heard together as representative "test appeals" for the purpose of attempting to achieve a degree of uniformity in the approach taken and orders made by the Board concerning compensation to owners of surface rights.

The Alberta Court of Queen's Bench set out certain guidelines respecting compensation to owners of surface rights and deferred final disposition of the appeals pending argument as to the effect of an amendment to the Surface Rights Act providing for entry fees.

Mines and Minerals - Topic 6101

Operation of mines, quarries and wells - Compensation to owners of surface rights - General - The Alberta Court of Queen's Bench stated that the purpose of the Surface Rights Act was (1) to encourage landowners and operators to resolve their compensation and operational problems between themselves to their mutual satisfaction and (2) to provide the machinery, through the Surface Rights Board, for a fast, inexpensive and in formal method of fixing compensation where the parties cannot agree - See paragraph 248.

Mines and Minerals - Topic 6103

Operation of mines, quarries and wells - Compensation to owners of surface rights - Relevant considerations - Area agreements - The Alberta Court of Queen's Bench held that where "area agreements" represent a true arm's length negotiation between owners and operators bargaining on equal footing, the agreements are to be accorded great weight by the Surface Rights Board in fixing compensation, but are not absolutely binding on the Board - The court stated that "even one example of an 'area agreement' freely negotiated should be regarded as highly relevant and cogent evidence" and that the Board "should not be too restrictive in its interpretation of the geographical length and breadth of the area to be affected by an 'area agreement'" - See paragraphs 261, 267.

Mines and Minerals - Topic 6103

Operation of mines, quarries and wells - Compensation to owners of surface rights - Relevant considerations - The Alberta Court of Queen's Bench held that if no "area agreements" are negotiated or there is no "pattern" in an area respecting compensation, then the guidelines for the fixing of compensation by the Surface Rights Board are those broad ones set out in s. 25 of the Surface Rights Act - The court stated that until an "area agreement" is negotiated or a clear pattern of compensation emerges the Board is to fix compensation under s. 25 using all of the factors involved and not just the "four heads" approach - See paragraphs 262 to 263.

Mines and Minerals - Topic 6104

Operation of mines, quarries and wells - Compensation to owners of surface rights - Global approach - The Alberta Court of Queen's Bench stated that "the method of determining compensation by a global flat rate or a sort of formula approach arising out of an area agreement does not offend the (Surface Rights) Act nor the Interpretation Act and is open to the court to use if it deems advisable" - See paragraph 267.

Statutes - Topic 4985

Enabling acts - Power coupled with duty - Permissive power - "May" - Section 25(1) of the Surface Rights Act, S.A. 1983, c. S-27.1, set out the factors the Surface Rights Board "may" consider in fixing compensation to owners of surface rights - The Alberta Court of Queen's Bench held that "may" was permissive rather than mandatory - See paragraph 10.

Cases Noticed:

Sulpetro of Canada Ltd. v. Palley (1983), 44 A.R. 57, refd to. [para. 22].

Marcovich Bros. Farming Co. Ltd. v. PanCanadian Petroleum Limited (1984), 54 A.R. 72; 30 Alta. L.R.(2d) 211, refd to. [para. 37].

Nova v. Bain (1985), 36 Alta. L.R.(2d) 289, refd to. [para. 37].

Caswell v. Alexander Petroleum, [1972] 3 W.W.R. 706 (Alta. C.A.), refd to. [para. 139].

Esso Resources Canada Ltd. v. Smulski (1981), 18 Alta. L.R.(2d) 200, refd to. [para. 140].

Livingston v. Siebens Oil & Gas Ltd., [1978] 3 W.W.R. 484; 8 A.R. 439 (Alta. C.A.), refd to. [para. 140].

Alberta v. Bonaventure Sales (1980), 22 L.C.R. 164, refd to. [para. 143].

Chochin Pipelines Ltd. v. Rattray, [1979] 6 W.W.R. 775; 27 A.R. 32, refd to. [para. 143].

Whitehouse v. Sun Oil Co. Ltd., [1982] 6 W.W.R. 289; 40 A.R. 380, refd to. [para. 143].

Gaschnitz v. Werthill, 13 Alta. L.R. 248, refd to. [para. 144].

Mobil GC Canada Ltd. v. Fletcher et al. (1984), 53 A.R. 130; 30 L.C.R. 207, refd to. [para. 146].

Petryshen and Petryshen v. Nova, An Alberta Corporation (1982), 23 Alta. L.R. 193, refd to. [para. 257].

Lomond Grazing Association v. Pan-Canadian Petroleum Limited et al. (1985), 63 A.R. 120, refd to. [para. 260].

Dome v. Greckul (1984), 30 L.C.R. 198, refd to. [para. 267].

Statutes Noticed:

Administrative Procedures Act, R.S.A. 1980, c. A-2, sect. 7 [para. 24].

Land Surface Conservation and Reclamation Act, R.S.A. 1980, c. L-3, generally [para. 22].

Right-of-Entry Arbitration Act, S.A. 1947, c. 24, generally [para. 7].

Surface Rights Act, S.A. 1983, c. S-27.1, sect. 12(1) [para. 8]; sect. 25(1) [para. 10].

Counsel:

Peter T. Johnston, for Ada Richards;

Darryl Carter and Roy Carter, for all other landowners;

G.C. Bolton, for Dome Petroleum Ltd.;

Ellen Dechter, for PanCanadian Petroleum Limited;

J.G. Hanley, for Norcen Energy Resources Limited.

These appeals were heard before Miller, A.C.J., of the Alberta Court of Queen's Bench, Judicial District of Grande Prairie, who delivered the following judgment on December 10, 1985.