The City of Vancouver passed resolutions declaring it would not do business with Shell Canada until its parent company withdrew from South Africa, in protest of apartheid.
Shell challenged the resolutions as ultra vires the municipality.
The Supreme Court of Canada held that the resolutions were invalid because they were passed for an extraterritorial purpose rather than a municipal purpose.
The Court found that the city's statutory powers to engage in commercial undertakings and provide for good government did not authorize boycotts based on matters external to the interests of the citizens of the municipality, nor did they authorize discrimination for non-commercial reasons relating to foreign political policy.
