Judge differs with Canfor in stumpage rate fight

Canadian Forest Products Ltd. has failed to convince a B.C. Supreme Court Justice it deserves a break on stumpage for timber it had been harvesting in the vicinity of Williston Lake.

The concept of "cycle time" played a significant role in the decision, issued Nov. 25 by Justice Bruce Butler. In essence, the longer it takes for the timber to be hauled from where it was cut to where it can be appraised, the lower the stumpage.

Canfor had been using logging trucks to transport the timber around Williston Lake to Mackenzie for appraisal but was being charged as if the logs were being hauled by barge or a boom and tow along the lake, a significantly quicker trip.

Canfor had claimed it was relying on the road because it had been unable to use the Manson log dump, located on the west side of the lake's Black Water Arm, near the connection to the Parsnip Arm.

The company said the site had not been used since 2010 and had fallen into disrepair - to the point where it lacked an operational barge and needed about $5.4 million worth of upgrades.

As a result, Canfor contended the costs involved in using the site outweighed the value of the cutting permits.

But the Forest Appeals Commission, which upheld the Ministry of Forests, Lands and Natural Resources District Manager's decision on the rate, did not need to be in a state of "absolute readiness" to be used as the basis for setting the rate.

Rather, it found log dump sites that have all of the "requisite physical characteristics" to allow the site to be made usable without extraordinary effort or expense.

Butler said the thrust of Canfor's argument is that the Commission should have found that the site unsafe and so unsuitable.

But he also noted that an engineer's opinion presented to the Commission on the work needed to be done was primarily focused on making the site capable of more efficiently processing a larger volume of logs. Comments on the safe use of equipment at the site were only tangential, Butler said.

"In short, Canfor is unable to show that the Commission made an error in law when considering site safety as an element of suitability of the log dump as a transportation site," Butler said. "There was ample evidence to support its conclusions."