The head of the Ontario Prospectors Association is keeping a close eye on a lawsuit between the province and a junior mining company.

Ontario has filed a statement of defence against a $110 million lawsuit by Northern Superior Resources, who alleges the province should have engaged First Nations on its behalf.

“It obviously affects the way we're going to do business in Ontario, and it also affects what the government's going to pay out, or [if the] government's going to win or lose,” said Garry Clark, executive director of the prospectors group.

garry clark

The Ontario Prospectors and Developers Association's Garry Clark says he hopes the outcome of the case will provide guidelines for the future. (Gord Ellis/CBC)

“It'll set some guidelines for the future, [and set a] definition of … who should be doing the consulting between First Nations and the explorers on the ground.”

North Superior Resources said it had rights to prospect near Sachigo Lake in northwestern Ontario. It alleges its exploration agreement with Sachigo fell apart in 2011 after the First Nation made demands the company deemed unreasonable.

Crown made 'good faith efforts'

In its statement of defence, the province says its duty to consult is owed to First Nations, not third parties. Ontario also contends it is not responsible for Sachigo Lake's alleged demands, or for the company's decision to reject them.

The province alleges the company consulted with and entered into its agreements with Sachigo Lake without seeking help from the Ministry of Northern Development and Mines.

The province also says that, once the relationship between Northern Superior and Sachigo Lake fell apart, "the Crown made reasonable and good faith efforts to repair the discord between [Nothern Superior Resources] and [Sachigo Lake First Nation], albeit without success."

The province is seeking that the lawsuit be dismissed with costs.

None of the allegations in the lawsuit have been proven in court.