A family who runs a fishing lodge east of Lutselk'e, N.W.T., is fighting for $3.2 million in compensation for adverse effects caused by the operations of the Northwest Territories Power Corporation (NTPC) — but the corporation is denying it's done anything wrong.

The Carter family has operated Nonacho Lake Lodge for more than 50 years. The lodge's namesake lake was dammed in 1968, as part of the power corporation's Taltson Hydroelectric System.

The Carters believe that power corporation operations in the area have disrupted water levels, caused erosion of the shoreline, and raised mercury concentrations in fish, adversely affecting their business.

Mercury warning

A health advisory warning about the consumption of fish from Nonacho Lake. (Carter family presentation)

"The adverse effects caused by NTPC's operations has led to a decline in patrons at the lodge," said Eleanor Olszewski, legal counsel for the Carter Family.

"High concentrations of mercury in the fish make fisherman concerned whether or not they can eat fish caught at the lake. That's a serious problem for a fishing lodge."

'It's not a past loss'

The Mackenzie Valley Land and Water Board is hearing the family's case this week in Yellowknife. In 2011, the Carters submitted their initial claim, seeking $6 million in compensation. However, the Mackenzie Valley Land and Water board awarded the Carter family total damages of only $62,500. 

Eleanor Olszewski

'High concentrations of mercury in the fish make fisherman concerned whether or not they can eat fish caught at the lake,' Eleanor Olszewski, legal counsel for the Carter Family. (CBC)

The family appealed the decision to the territory's supreme court. Justice Karan Shaner found procedural issues with the original hearing and ordered the board to take a second look at the claim.

However, Shaner also confirmed the board did not have the authority to award compensation under previous licences — with the current licence coming into effect in 2012 — meaning the Carters could not ask for compensation for damages before that date.

According to an NTPC presentation, the dam on Nonacho Lake hasn't been used for power generation since the mine at Pine Point closed in 1986, and there has been no activity at the dam since closing one gate in 2014.

NTPC believes that since there have been no new negative effects on the lodge, there should be no compensation.

"No mercury would or could be released into the aquatic environment unless the water level on the lake exceeds the previously established high water mark. That's the way it works," said Douglas Evanchuk, legal counsel for NTPC.

Douglas Evanchuk

'That level of water will not be reached because of NTPC’s operations,' says Douglas Evanchuk, legal counsel for NTPC. (CBC)

"That level of water will not be reached because of NTPC's operations."

The Carter family is calculating compensation differently, comparing how many patrons visited the lodge from the previous water license — 1997 to 2011 — to the decades before the mercury contamination. They claim that during that time period, the number of patrons dropped by about 75 per cent.

"That fact that we look at 15 years is consistent with the license period. It most definitely precedes the water licence date. It's not a past loss, though. It's just historical data," said Randy Popik, financial litigation advisor for the Carter family.

The Mackenzie Valley Land and Water Board is expected to make their decision later this summer.