B.C. Court of Appeal has overturned a Supreme Court judgment, ruling that the provincial government adequately consulted with Adams Lake Indian Band over the incorporation of Sun Peaks.

The Adams Lake Band had argued its interests weren't properly addressed before the government approved the creation of the Sun Peaks municipality in 2010.

A B.C. Supreme Court judge agreed in a ruling last year, saying the province had breached its constitutional duty by failing to accommodate the interests of the band. The province appealed that ruling and the band filed a cross-appeal, saying the initial judge did not make any mistakes.

The Appeal Court has now sided with the government, saying the consultations were adequate and the accommodations made by the province were reasonable in the circumstances.

The court says the incorporation simply replaced one form of local government with another. The area was previously governed by the TNRD and municipal incorporation had minimal effects on the band's claim to aboriginal title and rights, the court ruled.

That's not how Chief Nelson Leon sees it.

"I'd have to say there's a general feeling of disappointment," Leon said. He met briefly with band council Thursday to discuss the matter.

"We're going to take a day or two to take a look at the decision and decide on a course of action."

Leon said the appeals court took a very narrow view of the Supreme Court decision and a fairly easy route out of the matter. It looked only at the issue of incorporation and not how incorporation affects aboriginal rights and title, he said.

Sun Peaks Mayor Al Raine described the ruling as one of legal technicalities, but which properly distinguishes between incorporation and the development of Sun Peaks Resort.

"The original (B.C. Supreme Court) decision was a bit confusing in that it seemed to state that the court recognize the incorporation of the municipality was just an extension of Sun Peaks Resort Corporation and all of its development rights," Raine said. "Nothing could be further from the truth."

Raine stressed the municipality's intent to build meaningful relationships with neighbouring First Nations, a process started recently with community-to-community forums. He thinks there is good will on both sides.

"The practicality of all of this is the Supreme Court of B.C. is not going to resolve the issues that have existed in the past and still exist between the bands and the Sun Peaks community," he said. "But I think we can do that at a community level."

Leon said the two approaches - one through the courts, the other through direct engagement - are related.

"We're able to put various issues on the table as well as exploring issues that we can work together on," he said.

Those include recognition of territory, employment opportunities, a connecting road to the east and sister-school relationships as well as opportunities for children and youth, Raine said.