The appellant First Nation passed assessment and taxation by-laws pursuant to the Indian Act and assessed taxes against the respondent, a provincial Crown agent operating a utility on the reserve.
The respondent refused to pay, arguing immunity under s. 125 of the Constitution Act, 1867.
The Supreme Court of Canada held that the by-laws imposed taxes rather than regulatory charges, as they were designed to raise revenue for general local purposes and were not connected to a regulatory scheme.
Consequently, s. 125 rendered the by-laws constitutionally inapplicable to the respondent.
