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Cairns marking the graves of First Nations peoples who lived and worked here hundreds of years ago were found on Grace Islet, whose sale to the provincial government is nearly complete.John Lehmann/The Globe and Mail

Construction of Barry Slawsky's retirement home on Grace Islet in the Gulf Islands stalled on Dec. 18, with the concrete foundation and walls in place. On Thursday, the province explained why: It has reached a tentative deal to buy his island in an 11th-hour bid to protect the ancient aboriginal cemetery that covers the property.

The multimillion-dollar deal, expected to be finalized in February, will see the land protected as a nature conservancy, jointly managed by the local First Nations who had threatened legal action to protect what they deemed to be a sacred site.

It is the 12th time since the 1970s that the province has purchased land to resolve a conflict over what the law deems to be of archeological value – sites that are regarded by First Nations as sacred burial grounds.

To try to avoid future conflicts – there are thousands of similar First Nations grave sites known in B.C. – the minister responsible, Steve Thomson, says he is now asking for a review of the province's heritage and archeological laws and policies.

"We will look at policy and implementation – that's something I'll be looking to get some further advice on," he said in an interview. "I think that's fair to ask."

Mr. Slawsky purchased Grace Islet in 1990, and at that time the site was known to have archeological importance. But when ancient human remains were later found, archeologists investigated and found 16 burial rock cairns that would trace back at least 500 years.

Under the province's Heritage Conservation Act, it is illegal to damage, desecrate or alter a burial place that has historical or archeological value. But Mr. Slawsky was granted a provincial "site alteration" permit to build his retirement home after agreeing to construct it around and above the rock cairns.

The new deal, Mr. Thomson said, was put together with the Nature Conservancy of Canada, which acquires properties with strong ecological values. He said the site is ecologically valuable for its Garry oak plant communities and as part of the rare Coastal Douglas-fir ecosystem. That was a selling point to bring in the Nature Conservancy as a partner, but mostly this deal averts a conflict with First Nations over the protection of ancient graves.

Once the sale is complete, Mr. Thomson expects the local First Nations, who will be partners in managing the site, will want to scrub Grace Islet of all traces of Mr. Slawsky's construction.

The Cowichan Tribes drafted a civil claim asserting aboriginal title to the islet – an unusual case, if it proceeds, because land claims are normally limited to Crown land where title has not been extinguished.

William Seymour, chief of the Cowichan Tribes, is not ready to drop the case yet because there are other burial sites that remain unprotected from development. "Once I am happy we have reached conciliation, then I will not proceed," he said in an interview.

However, Mr. Seymour said this settlement is important. "I have been smiling ear-to-ear," he said. "It is such a good feeling, we now have a chance to restore the burial grounds to as close as we can to before the machines were brought on."

He said the chiefs in the region are comfortable with having the title to the land transferred to the Nature Conservancy, but details, such as who will have access to the land, are still being worked out.

George Nicholas, a professor of archeology and director of Simon Fraser University's Intellectual Property Issues in Cultural Heritage project, welcomed the settlement but said Mr. Thomson still needs to modernize the province's heritage laws.

"Even if the Grace Islet problem is resolved – and I hope it is – it doesn't ensure these issues do not emerge elsewhere," he said. "You have to resolve the issues of how ancestral burial grounds are protected, or not, under the law in British Columbia." He is heading up a group of lawyers, archeologists and anthropologists who are calling on the province to update the law to reflect the cultural importance of these burial sites to First Nations communities.

The province has not stated how much it will pay for the site, but Mr. Thomson confirmed it will be in the millions – the real-estate value of a private island in the Gulf Islands, plus Mr. Slawsky's construction costs, would not come with a small price tag.