The Osoyoos Indian Band sought to tax lands within its reserve that had been taken by the Province of British Columbia for an irrigation canal pursuant to an Order in Council under s. 35 of the Indian Act.
The Town of Oliver, which operated the canal, objected to the assessment.
The Supreme Court of Canada held that the Order in Council was ambiguous and should be interpreted as granting only a statutory easement, not a fee simple interest, in accordance with the Crown's fiduciary duty to minimally impair the Indian interest in reserve land.
Consequently, the lands remained 'in the reserve' and were subject to the Band's taxation jurisdiction under s. 83(1)(a) of the Indian Act.
