Decision Date: December 9, 2004

Panel: Cindy Derkaz

Keywords: Forest Act – ss. 105(1); Interior Appraisal Manual, isolated cutting authority area, stumpage rate determination; continuous road access.

Canadian Forest Products Ltd. and Tackama Forest Products Ltd. (the “Appellants”) filed separate appeals of stumpage advisory notices (“SANs”) issued on June 16, 2004 and April 28, 2004, respectively.  The former SAN was issued for Cutting Permit 599 (“CP 599”) by the Timber Pricing Co-ordinator, Northern Interior Forest Region, Ministry of Forests.  The latter SAN was issued for CP 595 by the Revenue Manger, Northern Interior Forest Region, Ministry of Forests.  The Appellants submitted that CP 599 and CP 595 were isolated cutting authority areas pursuant to the Interior Appraisal Manual (“IAM”), and that the Government should have applied the isolated cutting authority area provisions of section 4.8.2 of the IAM to the stumpage rate determinations.

The Commission found that section 4.8.2 of the IAM contained a clear and unambiguous definition of “an isolated cutting authority area”:

An isolated cutting authority area has no continuous road access to the nearest support centre (listed in section 4.4.3(6)).

The Commission also found that the roads leading into both CP 599 and CP 595 are non-existent for eight months of the year due to geographic and climatic conditions, thus the CPs clearly met the definition of an isolated cutting authority in section 4.8.2.  There were no words in section 4.8.2 to limit the Appellants’ application to the tree-to-truck phase of logging operations, as the Government submitted.

The Commission found that if the Government intended the word “continuous” in section 4.8.2 of the IAM to apply only during the tree-to-truck phase of logging, then the IAM requires an amendment to give that effect.  Furthermore, the Commission found no indication from the IAM or from Ministry representatives that the Minister did not intend cutting authority areas with ice/snow road access during harvesting, such as CP 599 and CP 595, to fall within the definition of “isolated cutting authority area.”

The Commission remitted the matter back to the persons who made the stumpage determinations with instructions to recalculate the total stumpage rate for both CP 599 and CP 595 by including an isolation cost estimate pursuant to section 4.8.2 of the IAM.  The appeals were allowed.