The Ka'agee Tu First Nation in the Northwest Territories says the federal government and industry should take more steps to co-operate with First Nations, after a Federal Court sided with them in a dispute with Ottawa.

In a ruling Friday, the court said the government violated the Ka'agee Tu's right to meaningful consultation when in 2005 it approved Paramount Resources' application to drill several new oil wells in the Cameron Hills area.

The Ka'agee Tu, also known as the Kakisa First Nation, had raised concerns about the proposed expansion in the Cameron Hills, its traditional hunting grounds and source of drinking water.

"The court has clearly ruled that Canada can't make unilateral decisions about major industrial projects on aboriginal lands without, in any way, addressing or dealing with the affected aboriginal communities," Tim Howard, a lawyer representing the First Nation, told CBC News on Monday.

"It seems that Canada needs to keep learning that lesson, and we hope that they'll finally take it to heart this time."

It was a second significant court victory for the Ka'agee Tu in its battle against the Cameron Hills development.

In 2006, the N.W.T. Supreme Court quashed six land and water permits issued to Paramount for drilling in the Cameron Hills, saying the proposed wells should have undergone a preliminary screening before permits were issued. A screening would determine whether a more thorough environmental assessment was needed.

As a result of Friday's ruling, Calgary-based Paramount's expansion has been put on hold. The court ordered all parties involved to reopen negotiations and resolve their differences before development can proceed.

'We still have our inherent rights': former chief

The ruling also reinforces the land rights of First Nations, even those without settled land claims, and says they must be involved in development proposals. The Ka'agee Tu is part of the 10-community Dehcho First Nation, which is currently negotiating a land claim settlement with the federal government.

The talks have encountered delays, partly because the Dehcho is the only First Nation along the proposed 1,200-kilometre Mackenzie Valley natural gas pipeline without a land claim agreement.

Former Ka'agee Tu chief Allan Landry said the First Nation, and the Dehcho as a whole, is concerned about new development in the region.

"That's one thing that only [Indian and Northern Affairs Canada] and the developer got to understand, that things are changing. That's the big, big issue here too," Landry said.

"Even though we don't have a land claim, we still have our inherent rights and our treaty rights, and it's there. It's not about whether we have land claims or not. So this will have a very, very big impact on the N.W.T."

Howard said the latest ruling does not set any new precedents, since the law was already settled in earlier cases. He accused the federal government of having a poor track record when it comes to approving developments.

"It doesn't consult with the communities, it doesn't comply with its legal duties, and the regrettable result is the communities are forced to take their resources, hire lawyers, [and] go to court in order to force Canada to comply with the law," he said.

"We're hoping that Canada will finally sort of get the message and start to voluntarily change its conduct without having to go to court."