Author: Nigel Bankes Page 43 of 89

Nigel Bankes is emeritus professor of law at the University of Calgary. Prior to his retirement in June 2021 Nigel held the chair in natural resources law in the Faculty of Law.

Compulsory Conciliation under the Law of the Sea Convention: Rich Pickings in the Decision on Objections to Competence of the Timor-Leste/Australia Conciliation Commission

By Nigel Bankes

On October 27, 2016

In Law of the Sea

By: Nigel Bankes

PDF Version: Compulsory Conciliation under the Law of the Sea Convention: Rich Pickings in the Decision on Objections to Competence of the Timor-Leste/Australia Conciliation Commission

Decision commented on: Conciliation Commission, Between the Democratic Republic of Timor-Leste and the Commonwealth of Australia: Decision on Australia’s Objections to Competence, 19 September 2016 (Registry, the Permanent Court of Arbitration)

Background

Part XV of the Law of the Sea Convention (LOSC or Convention) provides, inter alia, for “compulsory conciliation” with respect to disputes concerning the interpretation or application of the Convention in a number of instances. This particular dispute concerns Articles 74, 83 and 298 of the Convention. Articles 74 and 83 are the well-known provisions dealing with the delimitation of the exclusive economic zone and the continental shelf where there are overlapping entitlements as between adjacent or opposite states. Timor-Leste and Australia are opposite states separated by the Timor Sea which is approximately 300 NM wide. On the same day that Timor-Leste regained its independence (20 May 2002) the two states concluded the Timor Sea Treaty which established a Joint Petroleum Development Area pending delimitation of the boundary. Further negotiations between the two states led to the adoption (2006) of the Treaty on Certain Maritime Arrangements in the Timor Sea (CMATS). In separate arbitral proceedings Timor-Leste is contesting the validity of CMATS. The two states have yet to agree on a permanent maritime boundary.

Pre-Dynex Royalty Agreements Continue to Spawn Interest in Land Litigation

By Nigel Bankes

On October 13, 2016

In Contracts, Oil & Gas, Property

By: Nigel Bankes

PDF Version: Pre-Dynex Royalty Agreements Continue to Spawn Interest in Land Litigation

Decision Commented On: Re Walter Energy Canada Holdings, Inc., 2016 BCSC 1746 (CanLII)

In 2002 the Supreme Court of Canada handed down its decision in Bank of Montreal v Dynex Petroleum Ltd, 2002 SCC 7 (CanLII) in which it confirmed that a gross overriding royalty (GORR) carved out of a working interest in land was capable of subsisting as an interest in land as a matter of law. Whether any particular GORR created an interest in land, or simply a contractual claim, depends upon the intentions of the parties as revealed in the language adopted by the parties to describe the GORR. There is presumably no objection to expressing this intention with words such as “the parties intend that the right and interest created by clause x of this agreement is to be an interest in land” – so long as this intention is not contradicted by other language in the agreement when construed as a whole in accordance with the usual rules on the interpretation of contracts. See, Nigel Bankes, Private Royalty Agreements: A Canadian Viewpoint, Rocky Mountain Mineral Law Institute (2003). While Dynex definitively settled the issue of principle (can a GORR as a matter of law ever be an interest in land) it still requires an analysis of the intentions of the parties in any particular case, although this should be easier to demonstrate for post-2002 agreements than for pre-2002 agreements. That said, the matter had been widely litigated during the previous 40 years, and counsel should at least have been aware, well before then, of the need to use language appropriate to creating an interest in land rather than a contractual interest – if that was indeed the intention of the parties.

The South China Sea Award and the Vienna Convention on the Law of Treaties

By Nigel Bankes

On August 2, 2016

In International Law, Law of the Sea

By: Nigel Bankes

PDF Version: The South China Sea Award and the Vienna Convention on the Law of Treaties

Decision Commented On: Award on the Merits of the Annex VII Tribunal, In the Matter of the South China Sea Arbitration, The Republic of the Philippines v The People’s Republic of China, 12 July 2016

The Annex VII Tribunal in the South China Sea Arbitration handed down its decision on the merits in the dispute between the Philippines and China on 12 July 2016. The dispute between the parties involves China’s extensive maritime claims in the South China Sea (many within the context of China’s so-called nine dash line); claims in relation to fishing activities by Chinese flagged vessels; and claims in relation to China’s dredging and construction activities associated with reclamation activities on a series of maritime features in the South China Sea. The Tribunal ruled in favour of the Philippines on almost all issues in its 479 page unanimous and comprehensive decision. There are already a number of posts on the Award; see, for example the useful first thoughts offered by Doug Guilfoyle on the blog of the European Journal of International Law.

Introduction

This post examines the Tribunal’s approach to some of the interpretive issues raised in the course of its decision on the merits.

Attorney General Argues That Backdoor Amendment to PPAs was Unlawful

By Nigel Bankes

On July 26, 2016

In Administrative Law, Energy

By: Nigel Bankes

PDF Version: Attorney General Argues That Backdoor Amendment to PPAs was Unlawful

Matter Commented On: Originating Application for Declaratory Relief and Judicial Review, filed by the Attorney General, July 25, 2016

The origins of the Power Purchase Arrangements (PPAs) “termination” saga are discussed in detail in a previous post and readers may wish to refer to that post for the necessary background. In an interesting development the Attorney General has commenced an application seeking a declaration that the amendments that were made to the PPAs after the public review process conducted by the then Alberta Energy and Utilities Board (AEUB) had concluded are unlawful. The crucial amendment was to a clause in the PPA which allows the buyer to transfer responsibility for the PPA to the Balancing Pool when a change of law makes the PPA not just unprofitable but “more unprofitable”.

Knock-for-Knock Decision Affirmed by Court of Queen’s Bench

By Nigel Bankes

On July 8, 2016

In Contracts, Oil & Gas

By: Nigel Bankes

PDF Version: Knock-for-Knock Decision Affirmed by Court of Queen’s Bench

Case Commented On: Precision Drilling Canada Limited Partnership v Yangarra Resources Ltd, 2016 ABQB 365 (CanLII)

This matter, involving the interpretation of a standard form drilling contract, originally came on before Master Prowse as an application for summary judgement by Precision, the drilling contractor. My post on the Master Prowse’ decision, 2015 ABQB 433, is here and my post on Master Prowse’s further judgement, 2015 ABQB 649, on the “interest clause as penalty” issue is here. Both decisions favoured Precision, and Yangarra appealed both. In this decision Justice E.C. Wilson dismissed both appeals and affirmed Master Prowse’s decisions largely by quoting extensively from the learned Master’s reasons.