SUPERIOR COURT OF JUSTICE STATEMENT OF CLAIM

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B E T W E E N: SUPERIOR COURT OF JUSTICE Court File No.: HENVEY INLET FIRST NATION as represented by its duly elected Chief and Council - and - STACY MCQUABBIE and JACKIE PEARCE Plaintiff Defendants STATEMENT OF CLAIM TO THE DEFENDANT(S) A LEGAL PROCEEDING HAS BEEN COMMENCED AGAINST YOU by the plaintiff. The claim made against you is set out in the following pages. IF YOU WISH TO DEFEND THIS PROCEEDING, you or an Ontario lawyer acting for you must prepare a statement of defence in Form 18A prescribed by the Rules of Civil Procedure, serve it on the plaintiff s lawyer or, where the plaintiff does not have a lawyer, serve it on the plaintiff, and file it, with proof of service, in this court office, WITHIN TWENTY DAYS after this statement of claim is served on you, if you are served in Ontario. If you are served in another province or territory of Canada or in the United States of America, the period for serving and filing your statement of defence is forty days. If you are served outside Canada and the United States of America, the period is sixty days. Instead of serving and filing a statement of defence, you may serve and file a notice of intent to defend in form 18B prescribed by the Rules of Civil Procedure. This will entitle you to ten more days within which to serve and file your statement of defence. IF YOU FAIL TO DEFEND THIS PROCEEDING, JUDGMENT MAY BE GIVEN AGAINST YOU IN YOUR ABSENCE AND WITHOUT FURTHER NOTICE TO YOU. IF YOU WISH TO DEFEND THIS PROCEEDING BUT ARE UNABLE TO PAY LEGAL FEES, LEGAL AID MAY BE AVAILABLE TO YOU BY CONTACTING A LOCAL LEGAL AID OFFICE. Date: Issued by... Local Registrar

2 Address of court office: 89 James Street Parry Sound, Ontario P2A 1T7 TO: AND TO: Stacy McQuabbie 158 Sub Road Pickerel, Ontario P0G 1J0 Jackie Pearce 158 Sub Road Pickerel, Ontario P0G 1J0

3 1. The plaintiff claims: a. a declaration that the defendants Stacy McQuabbie and Jackie Pearce are not lawfully in possession of land within Indian Reserve No. 13; b. a declaration that the occupation of a garage with attached livestock shelter and a storage shed, located on common band lands adjacent to the house known as 158 Sub Road and within the 50-day capture zone for Communal Well No. 2, and the placement of wrecked automobiles and a front end loader on the intended security fenceline of the water treatment facility, by the defendants Stacy McQuabbie and Jackie Pearce, are trespasses of common band land within Indian Reserve No. 13; c. an order requiring Stacy McQuabbie and Jackie Pearce to remove from common band lands within Indian Reserve #13 the wrecked automobiles and front end loader which they have placed thereon, within 72 hours of service of this order, and further providing that, in default of compliance with this order within the specified time, the wrecked automobiles and front end loader may be removed by Henvey Inlet First Nation to a storage location of its choosing or disposed of as it sees fit, and the defendants shall be liable for the full cost thereof; d. an order requiring Stacy McQuabbie and Jackie Pearce to remove all personal property from the garage with attached livestock shelter, the storage shed which they have occupied, located on common band lands adjacent to the house known as 158 Sub Road and within the 50-day capture zone for Communal Well No. 2, within 72 hours of service of this order; e. a permanent mandatory injunction restraining Stacy McQuabbie and Jackie Pearce from interfering with the construction, maintenance or operation of the Community Water System on Indian Reserve No. 13;

4 f. a permanent mandatory injunction restraining Stacy McQuabbie and Jackie Pearce from entering upon or causing anything to be placed in or upon common band lands within the 50-day capture zone for Communal Well No. 2, except for purposes of ingress or egress from their home at 158 Sub Road; g. damages for intentional interference in contract in an amount to be specified at trial; h. against the defendant Stacy McQuabbie, punitive damages in the amount of $10,000.00; i. the plaintiff s costs of this action on a substantial indemnity basis; and j. such further and other relief as to this Honourable Court may seem just. 2. The plaintiff is an Indian Band pursuant to the Indian Act, R.S.C. 1985 c. I-5, located on Indian Reserve No. 13 in the geographic District of Sudbury and the geographic District of Parry Sound. The plaintiff is represented in these proceedings by its duly elected Chief and Council. 3. The defendants Stacy McQuabbie is a member of the Henvey Inlet First Nation and resides in a band-owned house on Indian Reserve No. 13 known as 158 Sub Road. 4. The defendant Jackie Pearce, who is not a member of the Henvey Inlet First Nation and who is not registered as an Indian pursuant to the Indian Act, cohabits with the defendant Stacy McQuabbie. 5. In 2005, the plaintiff entered into an agreement with Her Majesty the Queen in Right of Canada, for the development of a water management strategy and the construction of a communal water system for Indian Reserve No. 13. The agreement provided $3,185,300.00 for capital components including communal wells, elevated water storage tank and a water treatment facility (hereafter the Community Water System ).

5 6. In 2006, the plaintiff entered into a construction contract with Cecchetto & Sons for the construction of the Community Water System at a project cost of $3,434,987.00. 7. All the capital components of the Community Water System have been or will be constructed on common band lands within the limits of the Indian Reserve No. 13 which have not been allotted to any person. 8. The defendants Stacy McQuabbie and Jackie Pearce have constructed or personally appropriated the use of a garage with attached livestock shelter, and a storage shed, located on common band lands within Indian Reserve No. 13 and within the 50-day capture zone for Communal Well No. 2, without a right of possession. 9. The defendants Stacy McQuabbie and Jackie Pearce have engaged in trespasses of common band lands intended to frustrate and delay the construction of the Community Water System within Indian Reserve No. 13, including: a. from time to time, tethering horses in the livestock shelter; b. refusing to permit Band Council or its agents to relocate the garage, livestock shelter and storage shed outside the 50-day capture zone for Communal Well No. 2; c. refusing to permit the plaintiff s contractors onto common band lands in the vicinity of Communal Well No. 2; d. intimidating the plaintiff s construction workers engaged in the construction of works on common band lands, by videotaping them, ordering them to leave the lands and threatening to prosecute them for trespass; and

6 e. obstructing the construction of the water treatment facility security fence by dumping wrecked motor vehicles and parking a front end loader across the intended fence line. 10. The defendants actions have delayed completion of the Community Water System project and have increased the plaintiff s cost of construction by an amount to be proven at trial. 11. The defendant Stacy McQuabbie has stated to the plaintiff that his actions in obstructing the completion of the Community Water System are intended to force Indian and Northern Affairs Canada and the plaintiff to accept a division of the membership of Henvey Inlet First Nation into two Indian bands, and to recognize the defendant Stacy McQuabbie and his followers as the persons exclusively entitled to the use, benefit and aboriginal title in Indian Reserve No. 13. 12. The defendants activities within the 50-day capture zone of Communal Well No. 2 increase the risk of contamination of the communal groundwater supply and are a threat to the health and safety of the residents of the Indian Reserve No. 13. 13. The plaintiff proposes that this action be tried at Parry Sound, in the District of Parry Sound. DATED: 27 June 2007. William J. Taggart Barrister & Solicitor 35 King Street East Cobourg, Ontario K9A 1K6 Tel: 905-372-8700 Fax: 905-372-1943 Solicitor for the plaintiff LSUC A020789V