A half-billion-dollar
claim
Ottawa once tried to weasel an Alberta farmer out of his
mineral rights. Bad move
by Colby Cosh
WHEN the First World War ended, Canadians were
eager to do everything they could for the returning soldiers who had
served overseas. The intense patriotic love lasted for a
while--veterans were given their pick of the good jobs, the
prettiest women, the choicest goods. But memories soon began to
fade; the survivors of the war mostly just wanted to lead normal
lives. Eventually few reminders remained--the poppies of Armistice
Day, the Legion halls, and some parcels of land in the West that
Ottawa had given to veterans who wanted to homestead.
This last legacy of the war is now the cause of a potentially
nasty dispute between the Province of Alberta and the federal
government. At stake are $428 million in royalties from the minerals
on those Soldier Settlement lands. On February 8, the Alberta
government filed a claim against Ottawa for this amount before the
Court of Queen's Bench in Edmonton. In a strange twist of fate, the
case might never have come up if Ottawa had not tried to take the
mineral rights in a soldier spread from an Alberta farmer back in
1970.
The story begins in 1919, when the feds created the Soldier
Settlement Board to buy prairie land and teach the soldiers to work
it. One of the parcels, a 159-acre plot near Thorsby, about 30 miles
southwest of Edmonton, was bought by the government from a
homesteader in 1919, transferred to a veteran named Rusty Lynn in
1928, and sold almost immediately to a farmer named Charlie Snider,
who moved onto that land with his wife Tillie.
Under the Soldier Settlement law, the Crown was supposed to
reserve the mineral rights in the soldier lands to itself. But for
some reason, the Soldier Settlement lawyers neglected to mention
this reservation in the text of Charlie's land title. Charlie and
Tillie lived on the land into the 1960s, believing all the while
that the mineral rights were theirs alone. They paid mineral taxes
and eventually even earned a modest amount of money on a lease to
the Sun Oil Co.
Not long after--perhaps because of an earlier legal dust-up
between the Sniders and Rusty Lynn--Ottawa learned of the
incongruous situation and decided to play a little hardball to get
the mineral rights back. Fred Snider, Charlie and Tillie's son,
remembers that in 1970 a "goddamn government lawyer" appeared at the
house and presented him with papers. By this time, Charlie and
Tillie were deceased and Fred was living on the land as executor of
his parents' estate. He is still there today, and while the case is
a distant memory, he still sounds angry when he talks about
it.
"It would have been easy to give up," says the retired grader
operator, "but I wasn't gonna just up and give in to the goddamn
government." Thus began one of the longest legal battles in Canadian
history. It took 21 years for Canada v. Snider Estate to wend
its way to the Supreme Court. By this time, the dispute had boiled
down to a single issue. The Sniders had a good title to the mineral
rights--under Alberta law. The federal government had a clear claim
to them under its own law. So the question was this: in 1930, when
Ottawa relinquished ownership of natural resources to the prairie
provinces, did the mineral rights in the soldier lands get
transferred along with them? In 1991, the Supreme Court answered
"yes" by a margin of five to two.
For Fred Snider, the story was over (although he would have "sued
the bastards right back, if I hadn't gotten sick of fighting by
then"). For Alberta, the case was just beginning. The Snider
situation was unusual because the minerals had somehow been omitted
from the land title completely. But the vast majority of the titles
to soldier lands showed--and still show--the owners of the minerals
as the federal Crown. Alberta's Justice Department realized that the
Supreme Court had just handed those minerals back to them--and that,
just maybe, Ottawa suddenly owed Alberta 61 years' worth of
royalties.
It is those royalties for which Alberta is now suing. Normally,
Ottawa would have 30 days to respond to the lawsuit, but the Alberta
government has waived that deadline, so the suit remains in limbo
for the foreseeable future. Federal Justice spokesman Alex Swann
says the department's lawyers are studying the province's claim and
will respond eventually. Meanwhile, the feds have entered
negotiations with the Saskatchewan government for its undisclosed
share of the pie. For the federal government, it could end up as a
costly reminder to let sleeping dogs lie.
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