City of Medicine Hat v. A.G. (Canada), 85 DTC 5365 (Alta. C.A.)

In producing and distributing natural gas the City of Medicine Hat was acting at its own discretion rather than carrying out duties imposed by the Provincial Crown, and the revenues which it earned accrued to it rather than the Province. The City in acting as it did accordingly was not acting as an agent of the Provincial Crown and the Natural Gas and Liquids Tax and the Petroleum and Gas Revenue Tax were not ultra vires in their application to the City.

The fact that the Natural Gas and Liquids Tax and the Petroleum and Gas Revenue Tax may have inhibited the City of Medicine Hat to some extent in exercising the powers granted to it did not support the conclusion that those taxes were aimed at that result, i.e., the impairment of an instrumentality of the Province.