The Ontario government has bought out the developer of the site at the centre of a simmering aboriginal land-claims dispute.

The move was announced Friday morning during an Ontario Supreme Court hearing in Cayuga.

OPP officers have tried to maintain order during the tense land-claims dispute in Caledonia, Ont.
(Nathan Denette/Canadian Press)

The construction site at the centre of the controversy is owned by Henco Industries.  The company was building a subdivision there until Six Nations protesters first occupied the land on Feb. 28.

Protesters say the property is part of a large land grant back in 1784, but the provincial and federal governments insist the land was surrendered in 1841.

Ontario's aboriginal affairs minister said the purchase will do much to "dampen the temperature of the dispute."

David Ramsay refused to disclose the amount paid for the land. The province intends to hold the land in trust while talks aimed at ending the occupation continue between representatives of the Six Nations and the provincial and federal governments.

Six Nations spokesperson Hazel Hill welcomed the announcement as a positive development.

Superior Court Justice David Marshall ordered the hearing in Cayuga to look at why a court injunction calling for the removal of aboriginal protesters from the construction site in Caledonia, southwest of Hamilton, had not been enforced by Ontario Provincial Police.

The hearing resumed after a two-week break that was called so officials from the Indian Affairs Department and the Attorney General's Office could attend.

In a related development, the Ontario government announced it would offer another $1 million in compensation to Caledonia-area businesses hurt by road blockades set up by the Six Nations protesters last month.

The Canadian Press quoted provincial Economic Development Minister Joe Cordiano as saying the new money brings to $1.7 million the total amount of aid offered to revive the Caledonia area's economy.

Two frustrated business owners announced earlier this week that they've hired a lawyer to file a class-action lawsuit to recoup tens of millions of dollars they said they've lost since barricades went up outside the construction site.

Talks resume between protesters, province

Meanwhile, talks continued Friday between the province and aboriginal protesters.

Premier Dalton McGuinty called off talks earlier this week in response to a series of violent incidents last Friday.

The premier had issued an ultimatum demanding Six Nations leaders to co-operate with authorities by removing barricades and helping police find the seven suspects wanted in Friday's incidents.

Among the allegations, one of the suspects is accused of stealing a police vehicle and using it in an alleged attempt to run down an officer, who was injured.

In another incident the same day, demonstrators surrounded the car of an elderly couple. Later, two camera operators for a Hamilton TV station allege they were interviewing the couple when native protesters attacked them, demanding their footage.

The Six Nations Confederacy said the suspects had been removed from the area.

Six Nations leaders, a provincial negotiator and a federal negotiator resumed negotiations on Thursday and will continue them by conference call Friday. They also plan to meet again next week.