The taxpayer fished on and near a reserve, and sold his fish to an on-reserve co-op which sold the fish to a commercial fish seller ("Freshwater"). The Court found that the taxpayer's income from fishing was exempt under s. 87 from taxation.
Although the Court accepted the Minister's position that the co-op was legally an agent for the taxpayer's sale of fish to Freshwater, the Court nevertheless found that this arrangement was sufficiently connected with the reserve that the taxpayer's income was income from property on the reserve. The taxpayer's dealings with the co-op were entirely on-reserve, and the co-op itself was very important to the general economic life on the reserve, which was the biggest contributor to the reserve after the federal government. The reserve also controlled the quota and provided financial support through loans for capital fishing assets. The Court concluded that the Co-op was a "critically important institution in the economic life of the Reserve."
The taxpayer's fishing activities were "no more than a weak indicator" that the taxpayer's fishing income was situated on the reserve (para. 68). Although the taxpayer's fishing preparations were conducted on the reserve, his fishing was often carried out on lakes outside the reserve.