Court rules against Tagish on Eskay Creek dispute

Tagish Resources struck out once again in its bid to gain title to the TOK 3-6 claims which host the bulk of reserves on the Eskay Creek gold property north of Stewart, B.C.

Eskay Creek is owned 50% by Prime Resources Group (VSE) and 50% by Stikine Resources, with Corona (TSE) and Placer Dome (TSE) each holding indirect interests.

In early June, the Supreme Court of British Columbia upheld a decision made earlier this year by the province’s chief gold commissioner which allowed the current owners of the claims to retain them in good standing (T.N.M. Jan. 28/91).

Tagish’s complaint was on the grounds that the TOK 3-6 claims are not contiguous or adjoining other claims in the block, and as a result, the recorded holders forfeited the claims by failing to do assessment work on them in accordance with the Mineral Tenure Act.

This argument was rejected by the chief gold commissioner who said he found no evidence that the claimholders knew a staking gap existed between the TOK 3-6 claims and others making up the property until a survey was completed in 1989, 17 years after the claims were staked.

The gold commissioner said the Act imposes a 1-year limitation period within which this type of complaint can be made. And he also said the complaint “ignores the scheme of the Mineral Tenure Act which is to provide a mineral claimholder with security of title to allow stable investment of capital.”

Tagish then launched an appeal in the Supreme Court of British Columbia against Prime Resources Group and its subsidiary Calpine Resources, Stikine Resources, and Denis Lieutard, chief gold commissioner.

But Tagish’s appeal was dismissed by Chief Justice William Esson, who upheld the chief gold commissioner’s decision by stating that he agreed with the commissioner’s interpretation of key statutes of the Mineral Tenure Act.

In his reasons for judgment, the chief justice said the Mineral Tenure Act is the most recent version of a long line of statutes, beginning in the last century, regulating mining claims. Although many amendments have been made, he noted that the “basic elements and basic approach” — particularly as they relate to staking and recording of claims — have not changed much in substance.

“In applying these statutes, the courts have consistently recognized the difficulties inevitably encountered by those who search for minerals in a wild and inaccessible land,” the chief justice stated.

“The principal purposes of the Act are to encourage such activity and to provide a reasonably safe tenure for those who take risks and incur the expenses of exploration and development, all to the end that productive mines will come into being.

Having recognized those difficulties, the courts have resisted attempts to construe the Act and regulations so as to impose excessive consequences for honest errors.”