Date: 19991115
Docket: 96-1341-IT-I
BETWEEN:
ROSE ADAMS,
Appellant,
and
HER MAJESTY THE QUEEN,
Respondent.
Reasons for Judgment
Archambault, J.T.C.C.
[1] Ms. Rose Adams, a member of the Athabasca Chipewyan
First Nation (Chipewyan or Chipewyan Band) and an
Indian as defined in the Indian Act (Act), is
appealing an assessment by the Minister of National Revenue
(Minister) with respect to the 1993 taxation year. The
Minister included in her income $18,541.26 as employment income
for that taxation year. Ms. Adams claims that her employment
income is exempted from taxes pursuant to section 87 of the
Act which reads as follows:
87. (1) Notwithstanding any other Act of Parliament or any Act
of the legislature of a province, but subject to section 83, the
following property is exempt from taxation, namely,
(a) the interest of an Indian or a band in reserve
lands or surrendered lands; and
(b) the personal property of an Indian or a band
situated on a reserve.
(2) No Indian or band is subject to taxation in respect of the
ownership, occupation, possession or use of any property
mentioned in paragraph (1)(a) or (b) or is
otherwise subject to taxation in respect of any such
property.
[2] The main issue raised by this appeal is whether Ms.
Adams' employment income was situated on a reserve within the
meaning of the Act. Ms. Adams is basically relying on
two grounds in support of her appeal. The first is that her
employment income constitutes personal property given to her
under a treaty or an agreement between her Band and Her Majesty
and deemed to be situated on a reserve pursuant to
paragraph 90(1)(b) of the Act. Section 90
reads as follows:
90. (1) For the purposes of sections 87 and 89, personal
property that was
(a) purchased by Her Majesty with Indian moneys or
moneys appropriated by Parliament for the use and benefit of
Indians or bands, or
(b) given to Indians or to a band under a treaty or
agreement between a band and Her Majesty,
shall be deemed always to be situated on a reserve.
(2) Every transaction purporting to pass title to any property
that is by this section deemed to be situated on a reserve, or
any interest in such property, is void unless the transaction is
entered into with the consent of the Minister or is entered into
between members of a band or between the band and a member
thereof.
(3) Every person who enters into any transaction that is void
by virtue of subsection (2) is guilty of an offence, and every
person who, without the written consent of the Minister, destroys
personal property that is by this section deemed to be situated
on a reserve is guilty of an offence.
[3] Secondly, applying the connecting factors developed by the
case law, in particular in Williams v. Canada (1992),
90 D.L.R. (4th) 129, 92 DTC 6320, Ms. Adams contends
that her employment is situated on a reserve as defined in
section 2 of the Act, namely: "a tract of land,
the legal title to which is vested in Her Majesty, that has
been set apart by Her Majesty for the use and benefit of a
band".
[4] One of the main difficulties raised by this second ground
is whether the place where her services were performed and in
which she lived is a reserve within the meaning of the Act.
Although the land on which her employer’s premises and her
own residence are located is not part of the lands set aside as
reserves by the Governor General in Council on
June 3, 1954, Ms. Adams contends that her
employer’s premises and her own residence are located on a
de facto reserve.
[5] In her submission, the Respondent says that
paragraph 90(1)(b) of the Act does not apply because
Ms. Adams' employment income was not given to her pursuant to
a treaty or to an agreement which is ancillary to a treaty.
Alternatively, even if the agreement between Ms. Adams' band
and Her Majesty is an agreement referred to in
paragraph 90(1)(b) of the Act, the Respondent submits
that the money received by Ms. Adams was paid pursuant to an
employment agreement and not pursuant to an agreement between her
band and Her Majesty. The Respondent also submits that the
concept of de facto reserve ought to be rejected in this case.
Finally, Ms. Adams' income is insufficiently connected
to a reserve for her to be able to invoke
paragraph 87(1)(b) of the Act.
Facts
[6] There is no dispute as to most of the relevant facts in
this case. Indeed, the parties have filed an Agreed Statement of
Facts, which I reproduce here:
1. The Appellant is an Indian as defined in the Indian
Act.
2. The Appellant is a member of the Athabasca Chipewyan First
Nation ("ACFN"), as it is now called, which is a
"Band" as defined in s. 2 of the Indian
Act, which treated with Canada in 1899 at Fort Chipewyan,
which is located within the boundaries of Treaty 8.
3. In 1993 the Appellant was employed by the ACFN as the
Band’s Secretary, Clerk of the Band Council and Indian
Registry Administrator. Her duties included keeping minutes of
Band Council meetings, distributing same, preparing agenda for
council meetings and preparing correspondence of Council. As
Indian Registry Administrator, she issued Status Cards to ACFN
members, maintained the Band’s registry of Band Membership
and reported events affecting the ACFN membership, such as
births, deaths and marriages, to the Department of Indian Affairs
and Northern Development (DIAND). In addition, she had general
office duties such as receiving and distributing mail, telephone
calls, preparing and sending correspondence, acting as a
receptionist, purchasing office supplies and maintaining office
equipment.
4. The Appellant was paid a salary of $18,541.26 by the ACFN
in 1993.
5. The Minister of National Revenue assessed tax on the said
salary.
6. For the period April 1, 1992 to
March 31, 1993, DIAND and the ACFN were parties to a
Comprehensive Funding Arrangement
No. 92-93-00463-01. This Funding
Arrangement was amended June 30, 1992 to add funds for
Band housing.
7. For the period April 1, 1993 to
March 31, 1994, DIAND and the ACFN were parties to a
Comprehensive Funding Arrangement
No. 93-94-00463-01, which was amended on
April 20, 1994 to add funds for Band housing.
8. These Comprehensive Funding Arrangements provided for the
allocation of funds to the ACFN for activities described in
Schedules C and D of the Arrangements.
9. There are general terms and conditions provided for in the
Arrangements and there are also specific terms and conditions
which vary according to the type of funding, which types are
defined as: Contributions, Flexible Transfer Payments, or
Grant.
10. It is the usual case that Bands in Alberta who receive
funding for the activities described in Schedule C and D of
the Comprehensive Funding Arrangements are Bands who are located
on reserves set aside by Order in Council. The ACFN is an
exceptional case.
11. DIAND has an agreement with the Northlands School Division
and provides funds for tuition costs for the education of the
children of ACFN members separately from the Comprehensive
Funding Arrangements.
12. The Band Support Funding Policy (DIAND, Program
Procedures 20-2, vol. 1, Chapter 7.1)
states, among other things, that:
6.1 The Band Support Funding grant program is intended to
provide a financial base for the conduct of band government.
Councils may utilize funds provided to defray expenses incurred
such as
a) allowance for Chief and elected members of Council;
b) travel expenses for Chief and elected members;
c) salaries and travel for administrative staff;
d) office supplies, utilities, rent and equipment;
e) basic telephone rental and installation;
f) long distance telephone costs for council and
administrative purposes;
g) postage and bank charges;
h) band office janitorial and maintenance services;
i) annual audit and other professional fees; or
j) contributions toward tribal council expenses.
13. Unless arrangements are otherwise made by individual
members of the ACFN, DIAND will administer the estates of members
of the ACFN who resided in Fort Chipewyan at the time of their
death and the estates of orphaned minor children or handicapped
adults who reside in Fort Chipewyan.
14. For the 1992-1993 fiscal year, the ACFN received $143,703
from DIAND for Band Support Funding. The amount of $6,489 was
carried forward from the previous years’ Band Support
Funding amount. For Band administrative purposes, the ACFN also
received $6,412 in funding from DIAND, which was designated for
the administrative costs of other programs (such as lands,
revenues and trusts); it also received a $8,014 SEED grant from
the federal government to hire a summer student and it had
$15,330 from miscellaneous sources, including interest.
15. The ACFN maintains several bank accounts, including a band
administration account. In the Band administration account, there
is deposited Band Support Funding from DIAND, allocation for
education and the membership clerk from DIAND, grants for hiring
summer students (e.g. SEED), as well as miscellaneous
revenue.
16. The monies in the Band administration account are used to
pay salaries, Chief and Council expenses, office expenses and
miscellaneous administration costs. In 1993 the salary of the
Appellant was paid from the Band administration account.
17. If there are insufficient funds in the Band administration
account to pay salaries, Chief and Council expenses, or necessary
office expenses, monies are transferred from other program bank
accounts to supplement the Band administration account.
18. In 1954, the following lands[1] were set aside by Order in Council
for the use and benefit of the ACFN and are reserves within the
meaning of the Indian Act:
a) Chipewyan Indian Reserve No. 201 consisting of 49,600
acres more or less (Certificate of Title dated
December 23, 1937).
b) Chipewyan Indian Reserve No. 201A consisting of 54
acres more or less (Certificate of Title dated
December 23, 1937).
c) Chipewyan Indian Reserve No. 201B consisting of
48 acres more or less (Certificate of Title dated
December 23, 1937).
d) Chipewyan Indian Reserve No. 201C consisting of 45
acres more or less (Certificate of Title dated December 23,
1937).
e) Chipewyan Indian Reserve No. 201D consisting of 10 and
7/10 acres more or less (Certificate of Title dated
December 23, 1937).
f) Chipewyan Indian Reserve No. 201E consisting of
240 acres more or less (Certificate of Title dated
December 23, 1937).
g) Chipewyan Indian Reserve No. 201F consisting of 163
and 5/10 acres more or less (Certificate of Title dated
December 23, 1937).
h) Chipewyan Indian Reserve No. 201G consisting of
2,237 acres more or less (Certificate of Title dated
December 23, 1937).
19. Reserve #201 was set aside for the ACFN for the purpose of
providing the ACFN exclusive use of an area of the Athabasca
Delta for trapping purposes. The lands of Reserve #201 are
comprised mainly of swamp and are accessible only by water. The
lands are unsuitable for housing development.
20. There is no access by road to any of the reserves set out
in paragraph 18 above. There are no schools, roads, or
utilities, such as water, sewer, natural gas, electricity, or
telephone services, on these reserves. There are trapping cabins
on these reserves, which may be occupied seasonally.
21. The Hamlet of Fort Chipewyan, Alberta, has a population of
approximately 2,500 people, the majority of whom are status or
non-status Indians.
22. Many members of the ACFN reside at or near the Hamlet of
Fort Chipewyan on Federal Crown land or on lots acquired by
Canada for the purpose of providing housing to the members. The
acquisition of municipal lots for Indian housing is not common
and was required in this instance, since the reserves set aside
by Order in Council are not developed and have difficult
access.
23. In 1993, the Appellant resided in the Hamlet of Fort
Chipewyan on Lot 16, Block 8, Plan 912291 in an
area commonly known as the "Indian Affairs
Subdivision".
24. The home in which the Appellant lived in 1993 was a house
trailer owned by the ACFN and purchased by the Band with monies
provided by DIAND through the Indian On-Reserve Housing
Program.
25. The "Indian Affairs Subdivision" consists of
106.17 acres for which the administration and control was
transferred by the Province of Alberta to DIAND on
December 9, 1975 by Alberta Order in Council 1551/75, which
states, among other things, that the land is "to be
re-transferred to the Province of Alberta when the land is
no longer required by Canada for housing natives at Fort
Chipewyan".
26. The transfer was accepted by the Federal Government[2] by
P.C. 1976-1293 dated June 1, 1976.
27. Once the 106.17 acre parcel was transferred to DIAND,
it was subdivided for the purpose of providing band housing and
the subdivision plan was approved by both the ACFN and the
Mikisew Cree First Nation by Band Council Resolution dated
April 21, 1978.
28. The acquisition of the "Indian Affairs
Subdivision" met with the favour of both DIAND and the ACFN
and Mikisew Cree Band, as it provided the members with an enclave
within the community.
29. Both the ACFN and the Mikisew Cree Band have been
allocated lots in the "Indian Affairs Subdivision" for
the purpose of Band housing and each Band has constructed housing
on these lands for Band members utilizing monies from
DIAND’s housing program.
30. DIAND paid for the roads, water and sewer developed within
the subdivision. Roads within the subdivision were developed by
the two Bands and the Bands and DIAND re-surveyed the
subdivision in 1991.
31. The legal description of the subdivision until 1991 was
Lot 1, Block 4, Plan 7520446. After the 1991
re-survey, the plan number changed to 912291.
32. Since at least the early 1960’s, DIAND has used
Federal Crown lands for the purpose of Band housing, Band offices
and a nursing station in Fort Chipewyan for both the ACFN and the
Mikisew Cree Band and has purchased lands from the Province of
Alberta or individual land owners if needed for Band housing. The
"Indian Affairs Subdivision" was acquired for this
reason.
33. The treatment of lands held by Canada for housing the
members of the ACFN and the treatment of reserves created by
Order in Council are identical in respect of Canada’s
provision of funding for housing and other community
programs.
34. In 1985 the ACFN and Mikisew Cree Band jointly purchased,
through the Cree-Chip Development Corporation, federal land
in Fort Chipewyan for the purpose of constructing a building to
house new, larger band offices and to accommodate other community
services. This building is commonly referred to as the
"Multiplex".
35. The Cree-Chip Development Corporation was
incorporated in 1985 by the two Bands for the purpose of
developing the Multiplex. Each Band holds 50% of the shares in
trust for its respective members.
36. DIAND provided each Band with $150,000 through the Housing
and Capital Infrastructure Program toward the cost of acquiring
the land and building the Multiplex.
37. In 1986, both Bands relocated their offices to the
Multiplex. The remaining office space was leased to the province
and used as a Court house and for Keyano College classrooms.
38. In 1988 two reserves were set aside by Order in Council
for the Mikisew Cree First Nation and its Band office was
relocated to an on reserve location. Thereafter, that
Band’s space at the Multiplex was used as an adult training
centre.
[7] In addition to the Agreed Statement of Facts, the parties
filed a Book of Exhibits (Exhibit A-1) which contains
a number of relevant documents. Among these is a copy of
Treaty No. 8 and of the Report of Commissioners for
Treaty No. 8 dated September 22, 1899. The Chipewyan
Band was one of the parties to this treaty.
[8] Treaty No. 8 is a fairly short document - only
21 paragraphs - the most relevant portions of which are the
following:
AND WHEREAS, the said Commissioners have proceeded to
negotiate a treaty with the Cree, Beaver, Chipewyan and other
Indians, inhabiting the district hereinafter defined and
described, and the same has been agreed upon and concluded by the
respective bands at the dates mentioned hereunder, the said
Indians DO HEREBY CEDE, RELEASE, SURRENDER AND YIELD UP to the
Government of the Dominion of Canada, for Her Majesty the Queen
and Her successors for ever, all their rights, titles and
privileges whatsoever, to the lands included within the following
limits, that is to say:
. . .
And Her Majesty the Queen HEREBY AGREES with the said Indians
that they shall have right to pursue their usual vocations of
hunting, trapping and fishing throughout the tract surrendered as
heretofore described, subject to such regulations as may from
time to time be made by the Government of the country, acting
under the authority of Her Majesty, and saving and excepting such
tracts as may be required or taken up from time to time for
settlement, mining, lumbering, trading or other purposes.
And Her Majesty the Queen hereby agrees and undertakes to
lay aside reserves for such bands as desire reserves, the same
not to exceed in all one square mile for each family of five for
such number of families as may elect to reside on reserves,
or in that proportion for larger or smaller families; and for
such families or individual Indians as may prefer to live apart
from band reserves, Her Majesty undertakes to provide land in
severalty to the extent of 160 acres to each Indian, the
land to be conveyed with a proviso as to non-alienation
without the consent of the Governor General in Council of Canada,
the selection of such reserves, and lands in severalty, to be
made in the manner following, namely, the Superintendent General
of Indian Affairs shall depute and send a suitable person to
determine and set apart such reserves and lands, after consulting
with the Indians concerned as to the locality which may be found
suitable and open for selection.
. . .
Her Majesty also agrees that next year, and annually
afterwards for ever, She will cause to be paid to the said
Indians in cash, at suitable places and dates, of which the said
Indians shall be duly notified, to each Chief twenty-five
dollars, each Headman, not to exceed four to a large Band and two
to a small Band, fifteen dollars, and to every other Indian, of
whatever age, five dollars, the same, unless there be some
exceptional reason, to be paid only to heads of families for
those belonging thereto.
. . .
FURTHER, Her Majesty agrees to pay the salaries of such
teachers to instruct the children of said Indians as to Her
Majesty’s Government of Canada may seem advisable.
FURTHER, Her Majesty agrees to supply each Chief of a Band
that selects a reserve, for the use of that Band, ten axes, five
hand-saws, five augers, one grindstone, and the necessary
files and whetstones.
FURTHER, Her Majesty agrees that each Band that elects to take
a reserve and cultivate the soil, shall, as soon as convenient
after such reserve is set aside and settled upon, and the Band
has signified its choice and is prepared to break up the soil,
receive two hoes, one spade, one scythe and two hay forks for
every family so settled, and for every three families one plough
and one harrow, and to the Chief, for the use of his Band, two
horses or a yoke of oxen, and for each Band potatoes, barley,
oats and wheat (if such seed be suited to the locality of the
reserve), to plant the land actually broken up, and provisions
for one month in the spring for several years while planting such
seeds; and to every family one cow, and every Chief one bull, and
one mowing-machine and one reaper for the use of his Band
when it is ready for them; for such families as prefer to raise
stock instead of cultivating the soil, every family of five
persons, two cows, and every Chief two bulls and two
mowing-machines when ready for their use, and a like
proportion for smaller or larger families. The aforesaid
articles, machines and cattle to be given one for all for the
encouragement of agriculture and stock raising; and for such
Bands as prefer to continue hunting and fishing, as much
ammunition and twine for making nets annually as will amount in
value to one dollar per head of the families so engaged in
hunting and fishing.
[Emphasis added.]
[9] The terms of the treaty must be read in conjunction with
the Report of Commissioners for Treaty No. 8 dated
September 22, 1899, which reveals the following
information:
. . . The Chipewyans confined themselves to asking questions
and making brief arguments. They appeared to be more adept at
cross-examination than at speech-making, and the
Chief at Fort Chipewyan displayed considerable keenness of
intellect and much practical sense in pressing the claims of his
band. They all wanted as liberal, if not more liberal terms,
than were granted to the Indians of the plains. Some expected to
be fed by the Government after the making of treaty, and all
asked for assistance in season of distress and urged that the old
and indigent who were no longer able to hunt and trap and were
consequently often in distress should be cared for by the
Government. They requested that medicines be furnished. At
Vermilion, Chipewyan and Smith’s Landing, an earnest appeal
was made for the services of a medical man. There was expressed
at every point the fear that the making of the treaty would be
followed by the curtailment of the hunting and fishing
privileges, and many were impressed with the notion that the
treaty would lead to taxation and enforced military service.
They seemed desirous of securing educational advantages for their
children, but stipulated that in the matter of schools there
should be no interference with their religious beliefs.
We pointed out that the Government could not undertake to
maintain Indians in idleness; that the same means of earning a
livelihood would continue after the treaty as existed before it,
and that the Indians would be expected to make use of them. We
told them that the Government was always ready to give relief in
cases of actual destitution, and that in seasons of distress they
would without any special stipulation in the treaty receive such
assistance as it was usual to give in order to prevent starvation
among Indians in any part of Canada; and we stated that the
attention of the Government would be called to the need of some
special provision being made for assisting the old and indigent
who were unable to work and dependent on charity for the means of
sustaining life. We promised that supplies of medicines would
be put in the charge of persons selected by the Government at
different points, and would be distributed free to those of the
Indians who might require them. We explained that it would be
practically impossible for the Government to arrange for regular
medical attendance upon Indians so widely scattered over such an
extensive territory. We assured them, however, that the
Government would always be ready to avail itself of any
opportunity of affording medical service just as it provided that
the physician attached to the Commission should give free
attendance to all Indians whom he might find in need of treatment
as he passed through the country.
Our chief difficulty was the apprehension that the hunting
and fishing privileges were to be curtailed. The provision in
the treaty under which ammunition and twine is to be furnished
went far in the direction of quieting the fears of the Indians,
for they admitted that it would be unreasonable to furnish the
means of hunting and fishing if laws were to be enacted which
would make hunting and fishing so restricted as to render it
impossible to make a livelihood by such pursuits. But over and
above the provision, we had to solemnly assure them that only
such laws as to hunting and fishing as were in the interest of
the Indians and were found necessary in order to protect the fish
and fur-bearing animals would be made, and that they would
be as free to hunt and fish after the treaty as they would be if
they never entered into it.
We assured them that the treaty would not lead to any
forced interference with their mode of life, that it did not open
the way to the imposition of any tax, and that there was no fear
of enforced military service. We showed them that, whether
treaty was made or not, they were subject to the law, bound to
obey it, and liable to punishment for any infringements of it. We
pointed out that the law was designed for the protection of all,
and must be respected by all the inhabitants of the country,
irrespective of colour or origin; and that, in requiring them to
live at peace with white men who came into the country, and not
to molest them in person or in property, it only required them to
do what white men were required to do as to the Indians.
As to education the Indians were assured that there was no
need of any special stipulation, as it was the policy of the
Government to provide in every part of the country, as far as
circumstances would permit, for the education of Indian
children, and that the law, which was as strong as a treaty,
provided for non-interference with the religion of the
Indians in schools maintained or assisted by the
Government.
. . .
The Indians are given the option of taking reserves or land in
severalty. As the extent of the country treated for made it
impossible to define reserves or holdings, and as the Indians
were not prepared to make selections, we confined ourselves to
an undertaking to have reserves and holdings set apart in the
future, and the Indians were satisfied with the promise that this
would be done when required. There is no immediate necessity
for the general laying out of reserves or the allotting of land.
It will be quite time enough to do this as advancing settlement
makes necessary the surveying of the land. Indeed, the Indians
were generally averse to being placed on reserves. It would have
been impossible to have made a treaty if we had not assured them
that there was no intention of confining them to reserves. We had
to very clearly explain to them that the provision for reserves
and allotments of land were made for their protection, and to
secure to them in perpetuity a fair portion of the land ceded, in
the event of settlement advancing. [Emphasis added.]
[10] At the time the Chipewyan people entered into a treaty
with Canada, section 77 of the Indian Act,
49 Victoria, Chapter 43 (Revised Statutes of Canada
1886), provided for tax exemption for Indians as follows:
77. No Indian or non-treaty Indian shall be liable to be
taxed for any real or personal property, unless he holds, in his
individual right, real estate under a lease or in fee simple, or
personal property outside of the reserve or special
reserve--in which case he shall be liable to be taxed
for such real or personal property at the same rate as other
persons in the locality in which it is situate:
2. No taxes shall be levied on the real property of any
Indian, acquired under the enfranchisement clauses of this Act,
until the same has been declared liable to taxation by
proclamation of the Governor in Council, published in the
Canada Gazette:
3. All land vested in the Crown or in any person, in trust for
or for the use of any Indian or non-treaty Indian, or any
band or irregular band of Indians or non-treaty Indians,
shall be exempt from taxation.
[11] In the Book of Exhibits, there is also the Report On:
WAC Bennett Dam and Damage to Indian Reserve No. 201
Claim of March 1998 (Bennett Dam Report) prepared
by the Indian Claims Commission. This report contains a very
informative summary of the historical background and the
circumstances in which Treaty No. 8 was negotiated and
signed. I reproduce hereunder an extract from this report,
starting at page 14. It should be noted that I have added
the bold characters to indicate my emphasis and that I have
omitted the footnotes:
Treaty 8
On June 21, 1899, Treaty 8 was signed at Lesser Slave
Lake. Its written terms state that the "Cree, Beaver,
Chipewyan and other Indians" inhabiting the area ceded to
Canada approximately 324,900 square miles of land in northern
Alberta, northeastern British Columbia, northwestern Saskatchewan
and southern North-West Territories. Because the area was so
vast, it was impossible to have all interested Indians
represented at the Lesser Slave Lake negotiations, and so, in the
months that followed, the Treaty Commissioners travelled to
different locations in the ceded area to negotiate with other
bands. By 1914, some 32 bands had adhered to the terms of Treaty
8. On July 13, 1899, Treaty Commissioners
J.A.J. McKenna and J.H. Ross met with two bands
– one Cree and one Chipewyan - at Fort
Chipewyan on Lake Athabasca. Chief Alexandre Laviolette and
headmen Julien Ratfat and S. Heezell signed the
adhesion to Treaty 8 on behalf of the Chipewyan Band.
In the 1880s, railway construction and public works projects
expanded northward in Alberta. As a result, the Hudson’s
Bay Company and the Indians to the north of the Treaty 6
area petitioned for a treaty. The Crown initially declined to
enter into treaty in this area but with the discovery of gold in
the Yukon in 1896, interest in the treaty-making process was
renewed. The Yukon gold rush caused a large number of
non-Indians to pass through what is now northern Alberta
and Saskatchewan. An Order in Council dated
June 27, 1898, gave federal Treaty Commissioners
discretion to decide what territory would be included within the
treaty area. Treaty Commissioner Laird explained how boundaries
of the Treaty 8 area were determined:
The scope of the Commissioners' instructions was to obtain
the relinquishment of the Indian and Halfbreed title in that
tract of territory north of Treaty 6 to which Governmental
authority had to some extent been extended by sending Northwest
Mounted Police there to protect and control whites who were going
into the country as traders, travellers to the Klondike,
explorers, and miners. The territory, watered by the Lesser Slave
Lake, the Peace and Athabasca Rivers, the Athabasca Lake, the
South of Great Slave Lake and their tributaries, was where these
whites were finding their way, and the Commissioners did not deem
it necessary to extend Treaty 8 farther than they did.
In February 1899, Commissioner Laird issued instructions to
the government’s field representatives to clarify the
"misleading reports . . . being circulated among the
Indians" of the area and to assure them that their right to
hunt, fish and trap would be protected under the proposed
treaty:
You may explain to them that the Queen or Great Mother
while promising by her Commissioners to give them Reserves,
which they can call their own, and upon which white men will not
be allowed to settle without payment and the consent of the
Indians before a Government officer, yet the Indians will be
allowed to hunt and fish over all the country as they do now,
subject to such laws as may be made for the protection of game
and fish in the breeding season; and also as long as the Indians
do not molest or interfere with settlers, miners or
travellers.
The written terms of Treaty 8 provided for annuities,
education, agricultural assistance, and "reserves for
such bands as desire reserves, the same not to exceed in all one
square mile for each family of five for such number of families
as may elect to reside on reserves." The Indians were
also promised that they would have "the right to pursue
their usual vocations of hunting, trapping and fishing throughout
the tract surrendered . . . subject to such regulations as may
from time to time be made by the Government . . ."
With respect to the establishment of reserves, the Indians
told the Treaty Commissioners that they were primarily concerned
with protecting and continuing in their traditional hunting,
fishing, and trapping economy. This is confirmed by the following
excerpts from the Commissioners’ Report for
Treaty 8:
. . . [3]
The Treaty 8 Commissioners were aware that the northern
people’s traditional way of life based on hunting, fishing,
and trapping would continue to provide them with a viable means
of making a living. It is for this reason that the Indians did
not want to be limited to reserves and, for the most part, did
not want to take up farming. At Fort Chipewyan, a Catholic
missionary recorded this discussion between the Indians and
Treaty Commissioners in his diary:
The Commissioner explained the Government’s views and
the advantages it offered to the people. The Chief of the Crees
spoke up and expressed the conditions on which he would accept
the Government’s proposals:
1. Complete freedom to fish.
2. Complete freedom to hunt.
3. Complete freedom to trap.
4. As himself and his people are Catholics, he wants their
children to be educated in Catholic schools.
In his turn, the Chipewyan spokesman set the same conditions
as the first speaker. The Commissioner acknowledged all the
requests which both had voiced.
Father Gabriel Breynat also witnessed the treaty at
Fort Chipewyan and later wrote:
Discussions were long enough but sincere; Crees and
Chipewyans refused to be treated like Prairie Indians, and to
be parked on reserves. . . . It was essential to them to
retain complete freedom to move around.
At the conclusion of the Treaty 8 negotiations, the
Commissioners reported to the Superintendent General of Indian
Affairs that the selection and survey of reserves could wait
until some future date, when they were required to protect a
band’s land base:
. . .[4]
Selection and Survey of Athabasca Chipewyan Indian
Reserves
In the period immediately following the treaty, the Chipewyan
Band of Fort Chipewyan continued to follow its traditional
pursuits in relative prosperity with minimal interference from
government officials and non-Indians. The Department of
Indian Affairs did not establish an agency in the area until 1911
and contact with federal officials was limited to the annual
treaty annuity payments. Reports of these visits were typically
short and without detail, but they do provide some information
about the livelihood and well-being of the band. In 1903,
for example, the Treaty 8 Inspector, H.A. Conroy, reported
on his stop at Fort Chipewyan:
We paid the annuities of the Chipewyans and Crees. These
Indians also had been very successful in their hunts, as they had
sold large quantities of furs to the Hudson’s Bay Company
and traders. They had no sickness nor epidemics. Fish was very
plentiful and they were very prosperous, fur bringing good
prices.
By 1918, railways had been built to Peace River Crossing and
Fort McMurray, and steamers were operating on the Peace and
Athabasca Rivers, both of which provided non-Indian and
Métis trappers from the south with easy access to the
abundant fur supply in the Fort Chipewyan area. The influx of
trappers into the area soon began to cause a decline in fur
harvests, and by the early 1920s, the Indians of northern Alberta
were asking the Department of Indian Affairs for protection of
their way of life.
At the treaty payments at Fort Chipewyan in 1922, the Cree
Band and "some 50 members of the Chipewyan Band, living at
the mouth of Birch River" complained to the Agent about the
"outsiders", and the Agent recommended that
approximately 4000 square miles be set aside as a hunting
preserve for the exclusive use of these Indians:
in my opinion, the only effective way to protect their
interests would be to apply for a hunting and trapping Reserve
in that district in which they have their homes and have
always lived. I have outlined on the attached map the
district which they desire reserved. . . . [T]he district is
much larger than the amount of land guaranteed by treaty. But, as
the greater part of the district is swamp and marsh ground, not
suitable for farming or grazing, it would appear to me, that it
might justly, viewed from the Indian standpoint, be set
aside as a trapping reserve, and set aside for them, as from
time immemorial, they have used it for this purpose. The Indians
have no other way of making a living, constituted as they are,
than by hunting and trapping.
Chief Laviolette and other members of the Band made their
first formal request for this land as early as 1922. The area
requested was much larger than what they would later receive, but
the Peace-Athabasca Delta was definitely the desired location,
and they emphasized the fact that they needed the land to
continue their traditional vocations:
I have consulted the matter with my own people and the Cree
Band. We are now asking for as hunting reservation, according
to the size of the population of the two tribes, at the
present time, viz. From the old Fort on the Athabasca River to
Jack Fish Creek on the Peace River, down to the Junction of
the Peace and Athabasca River, from there to Big Bay on the north
shore of Athabasca Lake and across the Lake to the south shore,
and up to the boundary and back to Old Fort.
The above mentioned will give us the sufficient ground for
hunting, trapping and fishing we want big enough hunting reserve
for all of us to make a living on, in hunting, trapping and
fishing.
We can not go in for farming as we know farming will never be
a success down here.
We are all signing this to show that we are all ask for the
above reserve. There are lots of white men who are trapping
during the closed season, we want them stopped.
In the years that followed, while federal authorities
negotiated with the provincial government for larger hunting
preserves, the Cree and Chipewyan Bands at Fort Chipewyan
actively campaigned for a survey of its reserve. In 1923, a
delegation of the bands travelled to Edmonton at their own
expense where they met with the Minister of the Interior to press
their case. The matter was also discussed with government
officials during the annual treaty payments.
By 1926, the competition for fur resources in the area became
critical. In that year, the boundaries of neighbouring Wood
Buffalo Park were extended to include much of the Peace delta,
Lake Claire, Lake Mamawi, and areas as far west as the Athabaska
and Embarrass Rivers. Non-Indian trappers who were excluded
from the park moved into the Jackfish Lake area where the Indians
traditionally trapped. The situation became so tense that, in the
summer of 1926, the Indians retaliated against non-Indian
encroachment by setting forest fires in the hunting grounds.
In February 1927, Chipewyan Chief Jonas Laviolette wrote a
long letter to "The Chief of the Indian Department" in
Ottawa. His frustration is evident as he described the
problems created by the non-Indian trappers in the area and
the absolute necessity of a reserve:
I hope you will not mind me writing this letter to you but I
have been waiting so long to hear from you that I think you have
forgotten all about me and my people from Fort Chipewyan. . . . I
told you in Edmonton that the white trappers where [sic] going to
spoil my country and what I said then has come true. My country
is just about ruined.
The white men they kill fur with poison, they trap in the sand
before the snow comes. They break the rat house and they break
the beaver house and now there is hardly anything left and if you
don’t do something for us we are going to starve . .
.
For a long time now I have been begging for a Reserve for me
and my people at Jackfish Lake and we still want this very badly.
I hope you won’t mind me writing this to you but it is no
good sending this letter to Mr. Card he does not seem to try
to help us. Why doesn’t he come down here and try and stop
these trappers doing wrong to us. No one seems to care what
happens to us. There are lots of men here looking after Buffalo,
no one looking after us. We only see Mr. Card once a year
and then only for a few hours. . . .
The white trapper comes here and kills all here then moves to
another country. We cannot move and we don’t want to
because our fathers' fathers used to live here and want our
children to live here when we die. Jackfish Lake use to be fine
rat country but they don’t get a chance to breed up because
there are more trappers than rat. If you will give us this
country for a Reserve and someone to help us look after it will
save me and my people from starvation. Thirty years ago it was a
fine country because just the Indians lived in it. . . .
From Jackfish Lake it is not far to the Buffalo Park and we
like our Reserve to join to that line. And from Jackfish Lake we
would like it to go to the big lake because there we can catch
the fish. We are afraid to ask for too much hunting land for
our Reserve because you may not give us what we want, but we want
to have some land to call our own, where we can hunt and fish and
grow a little potatoes. If we get this Reserve, the white
trappers and the half breeds cannot bother us . .
.
At one of the Commission’s community sessions,
Mrs. Victorine Mercredi told the Commission:
In 1928 Chief Jonas Laviolette requested for a piece of land
which is known [as] Reserve 201 today for the Band members only
because there were a lot of people coming in and people were
starting to mix up and it was creating a problem for everybody.
So he requested the land, the delta just for trapping for the
people.
Despite Chief Laviolette’s entreaties, federal
authorities took no action to set aside reserve land until 1931,
when increased mineral exploration in the area threatened the
most desirable locations already selected by the Indians as
reserves. In the summer of 1931, H.W. Fairchild, a surveys
engineer employed by the Department of Indian Affairs, was
instructed to meet with the Indians to define reserve locations
"in accordance with the terms of Treaty No. 8 and
according to their population at this year’s Treaty
payment." Fairchild met the Chief and various band
members after treaty annuities were paid in July 1931 and
determined that Indian houses, gardens, cemeteries, and
fishing grounds were located at various sites, including five
small areas on the south shore of Lake Athabasca and on the
eastern edge of the delta, and another two sites up the Athabasca
River at Point Brule and Poplar Point. Seven small reserves,
identified as Indian Reserves 201A to 201G, were surveyed that
summer. The reserves ranged in size from 10.7 acres to
2237 acres for a total of 4.4 square miles of land.
Establishing the boundaries of IR 201, the main reserve in
the delta, was not as straightforward.Before Fairchild and
the survey party had left Edmonton, they had approached
Alberta government officials for permission to deviate from the
standard practices by, first, granting acreage in excess of the
treaty provisions because of the marshy nature of the land and,
second, by accepting natural water boundaries, which could be
identified from aerial surveys. Alberta officials deferred
their response to this request, and the survey party in the field
in the summer of 1931 traversed only the eastern boundary of the
proposed reserve. It was not until 1935 that federal and
provincial governments finally agreed on certain natural
boundaries and an area somewhat larger than the 68 square miles
required by treaty. According to the survey plan, the area set
aside for the Chipewyan Band was 77.5 square miles
(49,600 acres) "after deducting the water
areas." Certificate of title transferring the land from
Alberta to Canada was issued on December 23, 1937,
and on June 3, 1954, Chipewyan Reserve 201 was
officially established as an Indian reserve by Order in Council
PC 1954-817.
[12] In addition to the Agreed Statement of Facts and the Book
of Exhibits, there was the evidence of
Mrs. Victorine Mercredi who testified, as she had done
before the Indian Claims Commission, as an elder of the Chipewyan
Band. Mrs. Mercredi, aged 82 at the time she gave her
testimony, was a member of the Chipewyan Band Council from 1974
to 1984. Her father had been a chief of the Band. Mrs. Mercredi
was born at Old Fort Point which is now part of Chipewyan Indian
Reserve No. 201A. She indicated that she grew up in Old Fort
Point and in the bush engaging in trapping, hunting and
fishing.
[13] Ms. Adams’ counsel asked Mrs. Mercredi to
explain to the Court how the Chipewyan people perceived
Treaty No. 8 and to describe her people's way of
life. Mrs. Mercredi indicated that she obtained her
information about the treaty mainly from a woman who was not
identified, and from her father, who was present at the time of
the signing of the treaty. Given that her father was only 10
years old at that time, Mrs. Mercredi acknowledged that he
could not then have been aware of the terms of the treaty.
[14] Mrs. Mercredi’s understanding of the treaty is
that Canada promised that her people would be allowed to trap,
hunt and fish as long as the sun shines and the river flows. She
also acknowledged that Canada had undertaken to provide her
people with ammunition and twine. Although questioned repeatedly
by Ms. Adams’ counsel, Mrs. Mercredi indicated
that she was not aware of any other aspect of the treaty and she
stated she did not want to say anymore about it because she was
not there at the time of the treaty negotiations.
[15] Mrs. Mercredi described the main locations -
Old Fort Point, Jackfish Lake, Point Brule and Poplar Point
- where the Chipewyan people lived during her youth. These
areas are now respectively described as Chipewyan Indian
Reserves 201A, 201E, 201F and 201G. All are situated on the
south shore of Lake Athabasca and along the Athabasca River. She
confirmed that the Chipewyans lived in these locations because
the Chipewyan were hunters and trappers and wanted to live near
their hunting and trapping grounds.
[16] In those days, the Chipewyan people sent their children
as boarders to a residential school at Fort Chipewyan on the
north shore of Lake Athabasca. As long as the residential school
continued to be in operation, the Chipewyans were able to live on
their reserves, trapping, hunting and fishing. When the
residential school closed, only a regular public school
- that is, without boarding - was available
at Fort Chipewyan. In order to be able to live where their
children could attend school, more and more Chipewyans moved
their residence to Fort Chipewyan where no reserve lands had been
set aside by Her Majesty in 1954.
[17] Mrs. Mercredi stated that around 1958 the Department
of Indian Affairs and Northern Development (DIAND) had
funded the construction of houses on the Indian Reserves at
Jackfish Creek and Old Fort Point. After that, DIAND funded the
construction of buildings for her people only at Fort Chipewyan.
Mrs. Mercredi confirmed that she was presently living in
Fort Chipewyan and that her dream was to go back to live at Old
Fort Point.
[18] Mrs. Mercredi also confirmed that the WAC Bennett
Dam built by the Government of British Columbia had an adverse
impact on the hunting and trapping activities of the Chipewyan
people. The Indian Claims Commission concluded in its report that
the Chipewyan suffered extreme hardship and economic loss as a
result of environmental damage to Indian Reserve No. 201
caused by the construction and operation of the WAC Bennett Dam.
The Indian Claims Commission found that Canada had breached its
statutory and fiduciary obligations toward the Chipewyan and it
recommended that the Chipewyan claim be accepted for negotiation
under Canada’s Specific Claims Policy.
[19] Mr. Tony Punko, a non-Native, testified
at the request of Ms. Adams. In the past, he has worked as a
manager in charge of several outposts for the Hudson Bay Company
in several locations in northern Alberta, British Columbia and
the Northwest Territories, including Fort Chipewyan.
Mr. Punko has also acted either as a manager or as a
consultant for the Band. At the time of the hearing, he was
acting as a consultant. He confirmed that many Chipewyan people
were still hunting, trapping and fishing but for most Native
people these traditional vocations could not constitute a
sufficient source of income. They needed income from other
sources to sustain their livelihood.
[20] When asked whether he agreed that the Chipewyan Band had
obtained all the land that it was entitled to under
Treaty No. 8 as reserve, Mr. Punko refused to
answer. However, he acknowledged that negotiations were going on
to exchange reserve land for other land.
[21] Mr. Punko also stated that the Band was looking to
tourism as a source of future income for the Chipewyan. The
Athabasca Lake area is gorgeous country. If the government built
a road to the lake from the south, tourists would be able to go
there in greater numbers.
Analysis
[22] Before analyzing the application of sections 87 and
90 of the Act, it would be useful to restate the
principles of interpretation enunciated by the courts for
determining the scope of a particular statutory provision.
[23] The most basic of those principles is the
"contextual and purposive approach". This approach was
described as follows by the Supreme Court of Canada in Verdun
v. Toronto-Dominion Bank, [1996] 139 D.L.R. (4th)
415, at page 422, per L’Heureux-Dubé,
J.:
[22] To state the obvious, the first step in a question of
statutory interpretation is always an examination of the language
of the statute itself. As Elmer A. Driedger wrote in
his text, Construction of Statutes, 2d ed. (Toronto:
Butterworths, 1983), at p. 87:
Today there is only one principle or approach, namely, the
words of an Act are to be read in their entire context and in
their grammatical and ordinary sense harmoniously with the scheme
of the Act, the object of the Act, and the intention of
Parliament ... Lord Atkinson in Victoria (City) v.
Bishop of Vancouver Island [[1921] 2 A.C. 384, at
p. 387] put it this way:
"In the construction of statutes their words must be
interpreted in their ordinary grammatical sense, unless there be
something in the context, or in the object of the statute in
which they occur, or in the circumstances with reference to which
they are used, to show that they were used in a special sense
different from their ordinary grammatical sense."
This principle has been cited by our Court on numerous
occasions: see, for example, Friesen v. Canada, [1995]
3 S.C.R. 103, 127 D.L.R. (4th) 193 (S.C.C.),
Stubart Investments Ltd. v. The Queen, [1984]
1 S.C.R. 536, 10 D.L.R. (4th) 1 (S.C.C.), and
Québec (Communauté urbaine) v. Corp.
Notre-Dame de Bon-Secours, [1994]
3 S.C.R. 3 (S.C.C.). . . .
[24] Furthermore, given the nature of the Act and its
legislative intent to protect Native people, Dickson, J. of the
Supreme Court of Canada stated in Nowegijick v. The Queen et
al., 144 D.L.R. (3d) 193, at page 198:
It is legal lore that, to be valid, exemptions to tax laws
should be clearly expressed. It seems to me, however, that
treaties and statutes relating to Indians should be liberally
construed and doubtful expressions resolved in favour of the
Indian. If the statute contains language which can reasonably be
construed to confer tax exemption that construction, in my view,
is to be favoured over a more technical construction which might
be available to deny exemption.
[25] It was on the basis of this principle of interpretation,
namely the "liberal interpretative method", that the
Supreme Court of Canada concluded that the expression
"personal property" included employment income.
[26] This principle of interpretation adopted in
Nowegijick (supra) was also applied by the Manitoba
Court of Queen’s Bench in Mitchell v. Sandy Bay Indian
Band, [1983] 5 W.W.R. 117. The issue was whether
the expression "Her Majesty" in
paragraph 90(1)(b) of the Act included Her
Majesty both in right of a province and in right of Canada.
Basing itself on the liberal interpretative method, that court
concluded that it did include Her Majesty in right of a
province.
[27] On appeal to the Supreme Court of Canada and in a
decision reported at 71 D.L.R. (4th) 193, [1990] 2
S.C.R. 85 (sub nom. Mitchell v. Peguis v. Indian
Band), all the judges, except Dickson, J., who had
enunciated the liberal interpretative method in Nowegijick
(supra), concluded that the term "Her Majesty"
did not include the provincial crown. While accepting the rule
that treaties and statutes relating to Indians should be
liberally construed and doubtful expressions resolved in favour
of the Indians, La Forest, J. stated that it was still
necessary to reconcile any given interpretation with the policy
the Act seeks to promote. He qualified the rule as follows at
page 236:
I note at the outset that I do not take issue with the
principle that treaties and statutes relating to Indians should
be liberally construed and doubtful expressions resolved in
favour of the Indians. In the case of treaties, this principle
finds its justification in the fact that the Crown enjoyed a
superior bargaining position when negotiating treaties with
native peoples. From the perspective of the Indians, treaties
were drawn up in a foreign language, and incorporated references
to legal concepts of a system of law with which Indians were
unfamiliar. In the interpretation of these documents it is,
therefore, only just that the courts attempt to construe various
provisions as the Indians may be taken to have understood
them.
But as I view the matter, somewhat different considerations
must apply in the case of statutes relating to Indians. Whereas a
treaty is the product of bargaining between two contracting
parties, statutes relating to Indians are an expression of the
will of Parliament. Given this fact, I do not find it
particularly helpful to engage in speculation as to how Indians
may be taken to understand a given provision. Rather, I think
the approach must be to read the Act concerned with a view to
elucidating what it was that Parliament wished to effect in
enacting the particular section in question. This approach is
not a jettisoning of the liberal interpretative method. As
already stated, it is clear that in the interpretation of any
statutory enactment dealing with Indians, and particularly the
Indian Act, it is appropriate to interpret in a broad
manner provisions that are aimed at maintaining Indian rights,
and to interpret narrowly provisions aimed at limiting or
abrogating them. Thus if legislation bears on treaty promises,
the courts will always strain against adopting an interpretation
that has the effect of negating commitments undertaken by the
Crown: see United States v. Powers, 305 U.S. 527
(1939), at p. 533.
At the same time, I do not accept that this salutary rule
that statutory ambiguities must be resolved in favour of the
Indians implies automatic acceptance of a given construction
simply because it may be expected that the Indians would favour
it over any other competing interpretation. It is also necessary
to reconcile any given interpretation with the policies the Act
seeks to promote. [Emphasis added.]
[28] I shall deal with the submissions made by the Appellant
in the order that they were presented.
Is Ms. Adams' employment income deemed to be
situated on a reserve?
[29] Ms. Adams' first submission is that her
employment income constitutes personal property given to her as
an Indian under an agreement between her Band and Her Majesty,
and that this income is deemed pursuant to
paragraph 90(1)(b) of the Act to be always
situated on a reserve. I do not believe that this paragraph
applies to the salary received by Ms. Adams.
[30] First, the money that she received was not given to her
pursuant to an agreement between the Band and Her Majesty. It was
paid to her pursuant to an employment agreement entered into
between herself and the Band. The money was paid to her in
consideration for the services that she performed for the benefit
of the Band. A good example of what would constitute property
given under a treaty which would be covered by s. 90 of the Act
is a scholarship granted to a Native person to allow that
person to attend university: for an example, see Greyeyes v
The Queen, [1978] CTC 91.
[31] Ms. Adams argues that her salary is paid from moneys
provided under the Comprehensive Funding Arrangement entered into
by Her Majesty and the Chipewyan Band and that that Arrangement
is an agreement referred to in paragraph 90(1)b) of
the Act. Under the Comprehensive Funding Arrangement, Her Majesty
provides an unconditional grant to finance, at least in part, the
conduct of Band government. This is done pursuant to DIAND's
Band Support Funding Program. Since the Band Council utilizes
such funds to defray such expenses as salaries and travel for
administrative staff, it is fair to assume that a good portion of
Ms. Adams’ salary was paid out of this grant.
[32] However, it is also possible that some of her salary may
not have been paid out of moneys received pursuant to the
Comprehensive Funding Arrangement. This could have occurred
because the Band on occasion incurs a deficit and her salary is
paid out of a bank account in which other funds are deposited,
for instance, CMHC loans and other "miscellaneous
revenue" such as rental income from Band housing (see
paragraphs 14 and 15 of the Agreed Statement of Facts in
paragraph [6] above). So it is equally fair to assume that a
portion of her salary could have been paid out of funds from a
source other than an agreement between Her Majesty and Ms.
Adams’ Band.
[33] Even if we were to assume, as Ms. Adams contends, that
her salary can be traced to funds paid under the Comprehensive
Funding Arrangement, can it be said that her salary was given to
her under that arrangement? I do not have any doubt that such an
arrangement constitutes an agreement between the Chipewyan Band
and Her Majesty and that the funds granted thereunder constitute
money given to a band. However, does the Comprehensive Funding
Arrangement constitute an agreement referred to in
paragraph 90(1)(b) of the Act? Respondent’s
counsel submits that it does not. He relies on the following
dictum of La Forest, J. in Mitchell (supra), at
page 221, in support of his position:
. . . as I see it, the terms "treaty" and
"agreement" in s. 90(1)(b) take colour from
one another. It must be remembered that treaty promises are often
couched in very general terms and that supplementary agreements
are needed to flesh out the details of the commitments undertaken
by the Crown; see for an example of such an agreement Greyeyes
v. The Queen (1978), 84 D.L.R. (3d) 196, [1978] 2 F.C.
385, [1978] C.T.C. 91 (T.D.).
[34] La Forest, J. states at page 229 that the agreements
referred to in paragraph 90(1)(b) of the Act
are those which refer to monies given to Indians pursuant to the
Crown’s obligations under treaties and ancillary
agreements:
If, as I believe, the term "Her Majesty" in
s. 90(1)(b) is limited to the federal Crown, it
follows that the exemptions and privileges of ss. 87 and 89
will apply, regardless of situs, solely in respect of such
property as the federal Crown gives to Indians in acquitting
itself of its responsibilities pursuant to treaties, and their
ancillary agreements. This interpretation is consistent with
the historical antecedents to the section inasmuch as I interpret
the terms "presents" and "annuities" in those
sections as a reference to moneys the Crown has committed itself
to giving Indians pursuant to the cession by Indians of their
native lands.
[Emphasis added.]
[35] At the same page, La Forest, J. provides the following
explanation for having so concluded:
The reason why Parliament would have chosen to provide that
personal property of this sort should be protected regardless of
where that property is situated is obvious. Simply put, if treaty
promises are to be interpreted in the sense in which one may
assume them to have been naturally understood by the Indians, one
is led to conclude that the Indian signatories to the treaties
will have taken it for granted that property given to them by
treaty would be protected regardless of situs. In the
case of chattels, I am aware of no historical evidence that would
suggest that Indians ever expected that their ability to derive
the full benefit of this property could be placed in jeopardy
because of the ability of non-natives to impose liens or
taxes on it every time it was necessary to remove this property
from the reserve. Similarly, when the Crown acquits treaty and
ancillary obligations through the payment of moneys relating to
assistance in spheres such as education, housing, and health and
welfare, it cannot be accepted that Indians ever supposed
that their treaty right to these entitlements could be
compromised on the strength of subtle legal arguments that the
property concerned, though undoubtedly property to which the
Indians were entitled pursuant to an agreement engaging the
honour of the Crown, was notionally situated off the reserve and
therefore subject to the imposition of taxes or to attachment.
It would be highly incongruous if the Crown, given the tenor
of its treaty commitments, were permitted, through the imposition
of taxes, to diminish in significant measure the ostensible value
of the benefits conferred.
I think it was precisely this reasoning that led the Federal
Court, Trial Division in Greyeyes v. The Queen,
supra, to conclude that a scholarship paid to an Indian
student pursuant to an agreement setting out the details of
the federal government's promise in Treaty No. 6 to
provide assistance for education, should be deemed to be
situated on a reserve by the operation of
s. 90(1)(b).
In support of my view that Indians will have perceived that
their treaty benefits were given unconditionally, I would point
to the following extract from the report of the Treaty
Commissioners in respect of Treaty No. 8. The passage is
eloquent testimony to the fact that native peoples feared that
the imposition of taxes would seriously interfere with their
ability to maintain a traditional way of life on the lands
reserved for their use, and, additionally, leaves no doubt that
Indians were promised that their entitlements would be exempt
from taxation:
There was expressed at every point the fear that the making of
the Treaty would be followed by the curtailment of the hunting
and fishing privileges, and many were impressed with the notion
that the Treaty would lead to taxation and enforced military
service.
We assured them that the Treaty would not lead to any forced
interference with their mode of life, that it did not open the
way to the imposition of any tax, and that there was no fear of
enforced military service.
(Treaty No. 8, 1899 (Queen’s Printer, Ottawa), as
quoted in Bartlett, supra, at p. 5)
In summary, I conclude that an interpretation of
s. 90(1)(b), which sees its purpose as limited to
preventing non-natives from hampering Indians from
benefitting in full from the personal property promised Indians
in treaties and ancillary agreements, is perfectly consistent
with the tenor of the obligations that the Crown has always
assumed vis-à-vis the protection of native
property.
[Emphasis added.]
[36] In this particular case, counsel for the Respondent
argued that, under Treaty No. 8, Her Majesty had no
obligation to provide Band Support Funding. After having read
carefully the terms of Treaty No. 8 together with the
Report of Commissioners for Treaty No. 8 which provides
additional information as to what took place during the
negotiations, I am unable to find any statement that would
confirm the existence of any obligation on the part of Canada to
finance the cost of band government for the Chipewyan Band.
Therefore, the Comprehensive Funding Arrangement is not the type
of agreement referred to in paragraph 90(1)(b) of the
Act.
[37] In support of his submission, counsel for the Respondent
makes the following additional argument :
9. In addition, the context of subsection 90(1) of the
Indian Act includes subsections 90(2) and 90(3). If the
interpretation urged by the Appellant is correct, the
Appellant’s salary earned as an employee of the ACFN would
be property that is deemed by section 90 to be situated on a
Reserve, such that subsections 90(2) and 90(3) apply. It
would then appear that any transaction by which the Appellant
attempted to spend any portion of her salary, other than one
involving the Band or another member of the Band, would require
the consent of the Minister of Indian Affairs and Northern
Development and, in the absence of such consent, would constitute
an offence both by the Appellant and by the other party. This
absurd result provides an additional basis for rejecting the
breadth of application of paragraph 90(1)(b) of the
Indian Act and urged by the Appellant.
[38] I agree with counsel for the Respondent that if
Ms. Adams' salary was deemed to be property always
situated on the reserve, she would not be free to spend her money
as she pleased outside her reserve and this would certainly be an
odd result.
[39] I am also aware that my colleague Judge Bowie in
Kakfwi v. R. [1998] 1 C.T.C. 2695, took an approach
different from that taken by La Forest, J. in
Mitchell (supra) and concluded that
paragraph 90(1)(b) of the Act could apply to an
agreement which was not ancillary to a treaty: in that case the
Band Support Funding program was not related to any treaty rights
either. With great respect for the contrary opinion, I not only
believe that I am bound by the dictum of La Forest, J.
in Mitchell (supra) but I think that it expresses
the appropriate interpretation to be given that paragraph.[5]
[40] Ms. Adams’ salary from her employment could
not constitute personal property given to her under an agreement
referred to in paragraph 90(1)(b) of Act and is not
deemed always to be situated on a reserve.
Is Ms. Adams' employment income actually situated
on a reserve?
[41] Having concluded that Ms. Adams' employment
income is not deemed always to be situated on a reserve under
paragraph 90(1)(b) of the Act, it remains to be
determined whether her income was situated on a reserve according
to the usual rules of situs developed by the Supreme Court
of Canada in Williams (supra). At page 6326 DTC,
Gonthier, J. described the approach to be followed as
follows :
The approach which best reflects these concerns is one which
analyzes the matter in terms of categories of property and types
of taxation. For instance, connecting factors may have different
relevance with regard to unemployment insurance benefits than in
respect of employment income, or pension benefits. The first step
is to identify the various connecting factors which are
potentially relevant. These factors should then be analyzed to
determine what weight they should be given in identifying the
location of the property, in light of three considerations: (1)
the purpose of the exemption under the Indian Act; (2) the
type of property in question; and (3) the nature of the taxation
of that property. The question with regard to each connecting
factor is therefore what weight should be given that factor in
answering the question whether to tax that form of property in
that manner would amount to the erosion of the entitlement of the
Indian qua Indian on a reserve.
[42] In her review of the proper weight to be given to the
connecting factors in accordance with the Williams’
decision, Ms. Adams' counsel makes the following
statements in her written submission:
27. In reviewing the considerations set out by
Justice Gonthier it is clear that the analysis was not
intended to be a mechanistic application of a rigid test. Rather,
the weighing factors identified by Gonthier anticipate
consideration of property acquired by virtue of commercial
enterprise as opposed to Indian status and, indeed, to the intent
of the Indian in structuring his or her affairs within the
protection of the Indian Act provisions respecting
property as opposed to entry into the larger commercial
world.
28. The connecting factors test set out in Williams was
never intended as a technical exercise. Factors must always be
considered with a view to the purpose of the exemptions and where
the nature of the employment is the delivery and provision of
benefits to Indians, the factors weigh in favour of the
exemption.
In my view, when the personal property at issue is employment
income, it makes sense to consider the main purpose, duties and
functions of the underlying employment; specifically, with a view
to determining whether that employment was aimed at providing
benefits to Indians on reserves.
[43] Ms. Adams' counsel subsequently sets forth a
list of connecting factors which must be considered in this
particular case:
30. Rose Adams in 1993:
(a) resided on land subject to the administration and control
of Canada;
(b) resided on land which has been set aside by Canada for the
express purpose of providing housing for her Band;
(c) was and is counted by Canada as an Indian resident on
reserve for the purposes of providing funding under a
Comprehensive Funding Agreement;
(d) was an employee of an Indian band;
(e) performed job functions including assistance in band
governance and maintaining band membership records and
registration of Indians entitled to Indian status;
(f) performed job functions connected to the delivery of
services, including treaty benefits, to members of the First
Nation in Fort Chipewyan;
(g) is paid from funds provided to the band pursuant to a
Comprehensive Funding Agreement with Canada; and
(h) worked in the Band offices owned by a corporation whose
shares are held in trust for the members of her Band and another
Band.
[44] She then concludes as follows:
31. The circumstances of Rose Adams could hardly be said to be
characteristic of a person engaged in the commercial mainstream
of Canada. The nature of her employment, place of her employment,
and her employer are all intrinsically connected to her status as
an Indian and her membership in a recognized band. Having regard
to the purposive analysis set out by Justice Gonthier, the
property of Rose Adams was clearly intended to be exempt
from taxation.
[45] In applying the proper approach to resolve the issue
here, I also feel compelled to take into account the dicta of the
Federal Court of Appeal in Recalma et al. v. The Queen, 98
DTC 6238. In that case Linden, J. stated the following at pp.
6239-40:
In evaluating the various factors the Court must decide where
it "makes the most sense" to locate the personal
property in issue in order to avoid the "erosion of property
held by Indians qua Indians" so as to protect the
traditional Native way of life. It is also important in
assessing the different factors to consider whether the activity
generating the income was "intimately connected to" the
Reserve, that is, an "integral part" of Reserve life,
or whether it was more appropriate to consider it a part of
"commercial mainstream" activity. (See Folster v.
The Queen (1997), 97 DTC 5315 (F.C.A.)) We should indicate
that the concept of "commercial mainstream" is not a
test for determining whether property is situated on a reserve;
it is merely an aid to be used in evaluating the various factors
being considered. It is by no means determinative. The
primary reasoning exercise is to decide, looking at all the
connecting factors and keeping in mind the purpose of the
section, where the property is situated, that is, whether the
income earned was "integral to the life of the
Reserve", whether it was "intimately connected" to
that life, and whether it should be protected to prevent the
erosion of the property held by Natives qua
Natives.
It is plain that different factors may be given different
weights in each case. Extremely important, particularly in this
case, is the type of income being considered as attracting
taxation. Where the income is employment or salary income, the
residence of the taxpayer, the type of work being performed, the
place where the work was done and the nature of the benefit to
the Reserve are given great weight. (See Folster,
supra)
[Emphasis added]
[46] I would like to add a few comments to the statement of
Linden, J. that the concept of "commercial mainstream"
is not determinative. First, a few examples will illustrate the
accuracy of this statement. Many activities carried on by Native
people on reserves may not be part of their "traditional way
of life" but, on the contrary, may constitute
"commercial mainstream" activities and yet still
qualify for the exemption. For instance - and this would be
particularly true for reserves situated near urban agglomerations
– Native people can operate gas stations, convenience
stores[6] and even
shopping centres and casinos[7] whose clientele is mainly non-Native. Although
these activities can be described as being carried on in the
"commercial mainstream", the income earned from them
would clearly be exempt from taxation as long as they are engaged
in on a reserve by a Native person living on that reserve.
[47] The main distinction between activities of this nature
that are being conducted on a reserve and similar activities
conducted off a reserve is that in the first case they are being
carried on under protection from taxation as is often the case in
what people call tax haven countries.[8] But they are nevertheless
"commercial mainstream" activities. When the expression
"commercial mainstream" was used in Mitchell, I
suspect that what La Forest, J. had in mind was more that if a
Native person held property outside a reserve that property would
be situated in an unprotected, as opposed to a protected,
world.
[48] This brings me to my last comment. Given the
interpretation of section 87 of the Act which has been adopted in
the case law, we must realize that although the original intent
of this section may have been to avoid the "erosion of
property held by Indians qua Indians" so as to protect the
traditional Native way of life, the effect of the tax
exemption appears to be quite the opposite: it seems to
accelerate on reserves the replacement of "traditional way
of life" activities by "commercial mainstream"
activities[9]. So
the use of the concept of "commercial mainstream" as an
aid in evaluating the various connecting factors being considered
should become less relevant in the future.
[49] Having reviewed the approach to be followed to resolve
the issue herein, let us now apply it to the facts of this case.
As established in Williams, the first step is to identify
the various connecting factors which are potentially relevant. In
this particular case, these factors will include the
employee’s place of residence, the location where the work
is performed, the type of work performed and the nature of the
benefit to the reserve.
Employee’s place of residence and where the services
are performed
[50] I shall address together the issue of the
employee’s place of residence and that of where the
services are performed because they raise similar difficulties.
Ms. Adams lives in a trailer located on a lot in the Indian
Affairs Subdivision of the Hamlet of Fort Chipewyan. This lot is
not located on the Chipewyan Indian Reserves. As far as the
premises on which Ms. Adams performed her services are concerned,
they were also located in Fort Chipewyan but not in the Indian
Affairs Subdivision.
[51] There is a historical background that explains this
situation. When the Chipewyan people surrendered their rights to
their land under Treaty No. 8, Her Majesty granted them
the right to pursue their usual vocations of hunting, trapping
and fishing throughout the land surrendered. As
Mrs. Mercredi stated, the Chipewyan people were given the
assurance of being able to hunt, trap and fish as long as the sun
shines and the river flows. For them, this was the most important
thing. They were even generally adverse to being placed on a
reserve.
[52] They had to be convinced to accept the undertaking by Her
Majesty to create a reserve in the future for their own
protection. That they did so proved to be a wise decision because
in the early 1920s, the Chipewyan Band informed the government
that it wanted to exercise its right to reserve lands. It took
over 30 years to obtain an order in council which formally
set aside the lands to be used as reserves for the Band. The
Chipewyan people basically chose the territory which they thought
best for hunting and trapping and this territory is essentially
what makes up Chipewyan Indian Reserve No. 201. They also
obtained other lands, identified as Chipewyan Indian Reserves
Nos. 201A to 201G, which basically represent locations where
they had traditionally settled. These included Old Fort Point
where Mrs. Mercredi was raised and lived, Jackfish Lake,
Point Brule and Poplar Point. No lands situated at Fort Chipewyan
were selected and set aside by Her Majesty as a reserve in the
orders in council of 1954.
[53] Over a period of time, members of the Chipewyan Band
living on the reserves gradually moved to Fort Chipewyan. One of
the reasons for this was the closing of the residential school
and the need to find living accommodation near the public school
at Fort Chipewyan. In order to facilitate providing for the
housing needs of the Chipewyan people, Her Majesty acquired from
the province of Alberta the Indian Affairs Subdivision land to
allow members of the Chipewyan Band and those of the Mikisew Cree
Band to live in the Hamlet. An order in council of the province
of Alberta dated December 9, 1975 enabled the transfer
of the administration and control of certain public land to Her
Majesty (Canada) subject to a proviso that this land be
transferred back to the province when no longer required by Her
Majesty (Canada) for housing Native people at Fort Chipewyan.
Another order in council, issued by the Governor General in
Council and dated June 1, 1976, confirmed that Canada
accepted this transfer from the province of Alberta. There is no
order in council, similar to the ones in 1954 creating the
Chipewyan Indian Reserves, which formally sets apart the
Indian Affairs Subdivision as a reserve.
[54] Ms. Adams' counsel states in her written submission
that Ms. Adams lives and works on a de facto reserve. So
this issue has to be dealt with. A reserve is defined in
subsection 2(1) of the Act as follows:
"reserve"
(a) means a tract of land, the legal title to which is
vested in Her Majesty, that has been set apart by Her Majesty for
the use and benefit of a band, and
. . .
[55] Here, the evidence shows that title to the Indian Affairs
Subdivision was vested in Her Majesty. However, was it set apart
by "Her Majesty" for the use and benefit of the Band?
In my view, Ms. Adams did not succeed in discharging the
burden of proving that this land had been set aside by Her
Majesty for such purpose. In contrast, such evidence exists with
respect to the Chipewyan Indian Reserves as the 1954 orders in
council established that Her Majesty through her representative
in Canada, the Governor General, exercised her power to thus set
apart land.
[56] As has been recognized by Mahoney, J. in Town of
Hay River v. The Queen (1979), 101 D.L.R. (3d) 184, at
page 186, there is a distinction between the acquisition of
land by Her Majesty and the setting aside of such land for the
benefit of a Native band:
The authority of the Governor in Council under
para. 19(d) of the Territorial Lands Act to
"set apart and appropriate such areas or lands as may be
necessary to enable the Government of Canada to fulfil its
obligations under treaties with the Indians" is not the
source of authority to set apart Crown lands as a reserve in that
part of Canada to which the Act applies, i.e., the Yukon
and Northwest Territories. It is, rather, the authority to create
a land-bank for that purpose. The Indian Act defines
"reserve" but nowhere deals with the creation of a
reserve. Notwithstanding the words "pursuant to the Indian
Act" in para. (2) of the Order in Council, the
authority to set apart Crown Lands for an Indian reserve in the
Northwest Territories appears to remain based entirely on the
Royal prerogative, not subject to any statutory
limitation.
[Emphasis added and footnotes omitted.]
[57] Here the order in council of June 1, 1976 only
establishes the authority for acquiring the Indian Affairs
Subdivision. In no way does it set it apart for the benefit of
the Chipewyan. There is nothing in the Agreed Statement of Facts
to the effect that Her Majesty set the Indian Affairs Subdivision
apart for the Chipewyan Band. The closest it comes to so stating
is in paragraphs 27, 28 and 29 which I reproduce here again
for the sake of convenience:
27. Once the 106.17 acre parcel was transferred to DIAND, it
was subdivided for the purpose of providing band housing and the
subdivision plan was approved by both the ACFN and the Mikisew
Cree First Nation by Band Council Resolution dated April 21,
1978.
28. The acquisition of the "Indian Affairs
Subdivision" met with the favour of both DIAND and the ACFN
and Mikisew Cree Band, as it provided the members with an enclave
within the community.
29. Both the ACFN and the Mikisew Cree Band have been
allocated lots in the "Indian Affairs Subdivision" for
the purpose of Band housing and each Band has constructed housing
on these lands for Band members utilizing monies from DIAND's
housing program.
[58] There is no document in which Her Majesty describes the
"Indian Affairs Subdivision" and sets it apart. As
stated by Mahoney J. in Town of Hay River (supra),
there is no provision in the Act dealing with the creation
of a reserve. So neither the Minister of Indian Affairs and
Northern Development nor any civil servant working for that
Department has the authority to create a reserve. Only Her
Majesty, by virtue of her royal prerogative, can do so, and that
is what the definition of a "reserve" in section 2
of the Act contemplates.
[59] In Wewayakum Indian Band v. Canada and Wewayakai
Indian Band, (1995), 99 F.T.R. 1,[10] at paragraph 276, Teitelbaum,
J. stated that this royal prerogative must still be exercised by
means of some express legal instrument such as an order in
council or a letters’ patent. To come to this conclusion,
he relied on B.C. (A. G.) v. Mount Currie Indian Band
(1991), 54 B.C.L.R. (2d) 156 (C.A.).
[60] It should also be noted that this approach was not
followed by Maddison, J. of the Yukon Supreme Court in
Ross River Dena Council Band v. Canada, [1998]
3 C.N.L.R. 284 (Y.S.C.), which decision has been appealed by
the Respondent. Maddison, J. was of the view that the definition
of a reserve in the Act did not require any particular formality
such as a proclamation or order in council. As far as I know, a
decision of the British Columbia Court of Appeal has not been
issued at the time of writing this judgement. In addition, it
should be noted that we are not in the same situation as in the
Ross River Dena Council Band case: here the Chipewyan
people got all the reserve land that they were entitled to under
Treaty No. 8. They even received a greater area,
exclusive of water surfaces, than was stipulated in the treaty. I
doubt that Maddison, J. would have come to the same
conclusion in such circumstances.
[61] In addition to issuing orders in council and letters
patent as mentioned by Teitelbaum, J. in Wewayakum Indian
Band, Her Majesty can exercise her royal prerogative by other
methods such as proclamations, charters, grants or other
documents under the Great Seal.[11] Her Majesty could have issued a commission
authorizing someone to create such a reserve. For instance, a
Treaty Commissioner was commissioned for the signing of Treaty
No. 8. There is, however, no evidence of any such document
here.
[62] I can only infer from the facts of this case that DIAND
has authorized members of the Chipewyan Band to occupy the Indian
Affairs Subdivision and has helped fund the purchase by the
Chipewyan Band of the trailer for the use of Ms. Adams.
There is no evidence that the Minister of Indian Affairs and
Northern Development or any of its civil servants had any
authority to create a reserve. This could only have been done by
Her Majesty or her representative, the Governor General.
Obviously, the fact that DIAND counted Ms. Adams as a
resident of a reserve for the purposes of providing funding under
the Comprehensive Funding Arrangement is far from being
sufficient to establish the existence of a reserve.
[63] The fact that the Indian Affairs Subdivision is to be
returned to the province of Alberta when no longer needed for
housing Native people is an indication that this land was not to
be used permanently for the benefit of either the Chipewyan
people or the Mikisew Cree Indians. Although the word
"permanently" is not used in the definition of a
reserve, I believe this notion is an important one for the
purpose of this definition, especially if one considers the
historical context and the legislative purpose of the Act. It is
also useful to refer to the words[12] of Chipewyan Chief Jonas Laviolette
to determine what is meant by the notion of reserve: "we
want to have some land to call our own, where we can hunt and
fish and grow a little potatoes. If we get this Reserve, the
white trappers and the half breeds cannot bother
us." Treaty Commissioner Laird, who negotiated
Treaty No. 8, used similar words: . . . Reserves, which they
can call their own, and upon which white men will not be allowed
to settle without payment and the consent of the Indians before a
Government officer.
[64] The fact that the Indian Affairs Subdivision was occupied
by both the Chipewyan and the Mikisew Cree people also supports,
in my view, the proposition that the Chipewyan Band could not
consider those lands as their reserve. I am not aware of any case
where two bands share the same territory as a reserve. Indeed,
here, each band has its own reserve lands over which each
exercises alone its right to self-government.
[65] In the absence of any evidence that Her Majesty or her
representative the Governor General set the Indian Affairs
Subdivision apart for the use of the Chipewyan Band, I cannot
conclude that that subdivision constitutes a reserve within the
meaning of section 2 of the Act.
[66] With respect to the land on which the Multiplex was built
and where Ms. Adams provided her services, it is more
straightforward to determine that it does not constitute reserve
land. That land belongs to Cree-Chip Development
Corporation, which holds it in fee simple. Given that title to it
is not vested in Her Majesty, that land does not meet the
requirements of the definition in subsection 2(1) of the
Act.
[67] It therefore remains to be decided whether the land in
question could constitute a special reserve within the meaning of
section 36 of the Act which reads as follows:
36. Where lands have been set apart for the use and benefit of
a band and legal title thereto is not vested in Her Majesty, this
Act applies as though the lands were a reserve within the meaning
of this Act.
[68] There is no evidence that the Cree-Chip Development
Corporation has set aside the land for the benefit of a band.
There is nothing to contradict the conclusion that the
Cree-Chip Development Corporation is holding this property,
as do most corporations, for its own benefit and indirectly for
the ultimate benefit of its shareholders. The Multiplex was built
not only to provide premises for the administration of the
Chipewyan and the Mikisew Cree Bands and but also to supply
premises to the provincial government for a courthouse and
suchlike. In any event, I do not believe that section 36 was
meant to cover land such as the lot owned by the Cree-Chip
Development Corporation in the circumstances of this case.[13]
[69] In conclusion, it cannot be said that the building in
which the Chipewyan Band has its administrative offices and where
Ms. Adams provided her services is situated on a reserve. It
should be added that there is no evidence either establishing
that the Chipewyan Band’s head office was located on one of
its Chipewyan Indian Reserves. Based on the overall evidence in
this appeal, I think it is fair to assume that the Chipewyan Band
carries on all of its administrative functions at Fort Chipewyan
where it has no reserve.
The type of work performed and the nature of the benefit to
the reserve
[70] Having concluded that the Indian Affairs Subdivision and
the Multiplex were not located on a reserve, it is important to
determine through the application of the other connecting factors
whether Ms. Adams' employment income could still be
considered to be located on the Chipewyan Indian Reserves. In
this case, it makes sense to look at the type of work performed
and the nature of the benefit to the reserve together because
those two factors are intimately connected. Ms. Adams provides
services that directly benefit her Band and its members. Her
services are provided as part of the Band’s self-government
and the Band possesses reserves. In most cases, this would
constitute a factor strongly indicative of an intimate connection
to a reserve. Being part of the process of providing government
services to the members of a band would certainly qualify to a
high degree as being integral to the life of that band. And if
the band lived on a reserve, then it would be quite apparent that
such services and the income arising from the provision thereof
would be integral to the life of the reserve. The benefits to
such a band would be obvious.
[71] However, the facts of this particular case are very
unusual. There is no actual evidence that the members of the Band
live on the Chipewyan Indian Reserves. As I understand the
evidence, most members of the Chipewyan Band are living at or
near Fort Chipewyan.[14] The members of the Chipewyan Band seem to use the
Chipewyan Indian Reserves mainly, if not exclusively, for
hunting, trapping and fishing. This is not a surprising fact
given that Chipewyan people never wanted to be treated like
Prairie Indians, and to be parked on reserves. It is quite
apparent that the Chipewyan people are living off-reserve,
in Fort Chipewyan. It is there that they enjoy the benefits of
modern life: housing with water, sewage and services, access to
stores and so on. If most, if not all, of the people benefiting
from the services provided by Ms. Adams live off-reserve,
how can it be said that her services and the salary paid for
those services are connected to a reserve?
[72] Ms. Adams' services appear to be mainly directed
toward the members of the Band. Although this is not specifically
mentioned in the Agreed Statement of Facts,[15] it would be fair to assume
that some of her duties would necessarily have to be performed in
connection with the Chipewyan Indian Reserves. However there is
no evidence that this would represent a major portion of those
duties. Furthermore, there is evidence that trapping, hunting and
fishing can no longer sustain the livelihood of the Chipewyan
people. They need other sources of income to provide them with a
living. Given that most of her services benefited people living
in Fort Chipewyan, I think it is fair to conclude that Ms.
Adams' work was more intimately connected with life at Fort
Chipewyan than life on the Chipewyan Indian Reserves.
[73] I think this is a case which falls within the
circumstances, described by Gonthier, J. in Williams
(supra), at page 6324, of a Native person who has
been integrated into the larger society:
Therefore, under the Indian Act, an Indian has a choice
with regard to his personal property. The Indian may situate this
property on the reserve, in which case it is within the protected
area and free from seizure and taxation, or the Indian may
situate this property off the reserve, in which case it is
outside the protected area, and more fully available for ordinary
commercial purposes in society. Whether the Indian wishes to
remain within the protected reserve system or integrate more
fully into the larger commercial world is a choice left to the
Indian.
[74] As Ms. Adams, like many other Chipewyan people, has
decided to live and to work ouside the limits of a reserve in a
community where Native people of two different bands and
non-Natives live together, she is not entitled to the benefit of
section 87 with respect to her income. It is important to
recall the purpose for which section 87 was enacted. La
Forest, J. in Mitchell (supra) stated that
this provision is not meant to remedy the economically
disadvantaged position of Native people, but was only intended to
ensure that property on a reserve would be protected from
taxation. This exemption is not available to all Native people
but only those among them who hold reserve lands or personal
property situated on a reserve. The exemption is not available
with respect to property held by a Native person "qua
Native" but only to property held by a Native person
"qua Native" "on a reserve". This is what La
Forest, J. stated at pp. 226-227:
In summary, the historical record makes it clear that ss.
87
and 89 of the Indian Act, the sections to which the
deeming
provision of s. 90 applies, constitute part of a
legislative
"package" which bears the impress of an obligation
to native
peoples which the Crown has recognized at least since the
signing of the Royal Proclamation of 1763. From that time
on,
the Crown has always acknowledged that it is honour-bound
to
shield Indians from any efforts by non-natives to
dispossess
Indians of the property which they hold
qua Indians,
i.e.,
their land base and the chattels on that land
base.
It is also important to underscore the corollary to the
conclusion I have just drawn. The fact that the
modern-day
legislation, like its historical counterparts, is so
careful to
underline that exemptions from taxation and distraint
apply
only in respect of personal property situated on
reserves
demonstrates that the purpose of the legislation is not
to
remedy the economically disadvantaged position of
Indians by
ensuring that Indians may acquire, hold, and deal with
property
in the commercial mainstream on different terms than
their
fellow citizens. An examination of the decisions
bearing on
these sections confirms that Indians who acquire and deal
in
property outside lands reserved for their use, deal with it
on
the same basis as all other Canadians.
[Emphasis added.]
La Forest, J. added the following at page 228:
I draw attention to these decisions by way of emphasizing
once again that one must guard against ascribing an
overly
broad purpose to ss. 87 and 89. These provisions are
not
intended to confer privileges on Indians in respect of
any
property they may acquire and possess, wherever
situated.
Rather, their purpose is simply to insulate the property
interests of Indians in their reserve lands from the
intrusions
and interference of the larger society so as to ensure
that
Indians are not dispossessed of their entitlements.
[Emphasis added.]
[75] In this case, Ms. Adams' employment income does
not constitute "personal property" received by her
"qua Indian" "on a reserve". She was living
outside the reserve and working for an employer which carried on
its activities outside the reserve and the people benefiting from
the services that she performed for her employer were Native
people who were also living outside a reserve. In my view, the
factors reviewed above establish a more "intimate"
connection of Ms. Adams' employment income with life at
Fort Chipewyan than with life on the Chipewyan Indian Reserves.
Therefore her employment income is not situated on a reserve.
[76] Before concluding, this result should be tested to
determine whether it makes sense. For this purpose, I think it
would be useful to picture the situation of Ms. Adams by
assuming the issue has to do with tangible property rather than
intangible property such as income. It is quite obvious to
everyone that when the section 87 of the Act was first enacted,
income from employment, business or property was not contemplated
by Parliament. There was no Income Tax Act at that time.
However tangible property such as hunting, fishing, trapping and
farming equipment was clearly contemplated. The Supreme Court of
Canada in Nowegijick (supra) extended the concept
of "personal property" in section 87 of the Act to
include income, as that expression was susceptible of such
meaning. However, as stated in Mitchell
(supra), the exemption only applies to property
situated on a reserve.
[77] So, in this case, if Ms. Adams had a vehicle to transport
herself from her residence to her work at the Multiplex, this
vehicle would not be protected from seizure[16] or taxation[17] because it would not be
situated on a reserve.[18] Hence, if a creditor of Ms. Adams tried to seize her
car, she could not claim protection under section 89 of the Act.
Had I concluded that her salary was situated on a reserve, her
creditor could not have seized it, which, I think, would be an
illogical result. He or she could seize the vehicle used by
Ms. Adams to go to work but not the salary she earns from
that work. I therefore think that the result here is in keeping
with the spirit of section 87 of the Act and is the one that
makes the most sense.
[78] The fact that her salary and her vehicle would be subject
to seizure and taxation does not mean that her other property
would be so subject. For instance, any of her property situated
on the Chipewyan Indian Reserves would be protected therefrom. In
addition all property given to her under Treaty No. 8 and any
ancillary agreements would also be protected, even if situated
off the Chipewyan Indian Reserves, because such property is
deemed to be situated on a reserve pursuant to section 90 of the
Act. So there would not be any erosion of her entitlements
"qua Native" under these agreements.
[79] So, in applying the approach developed by the courts with
respect to intangible property, it is important not to lose sight
of the spirit in which sections 87 and 89 of the Act were
enacted. Intelligent people can always create an intellectual
link to establish an intimate connection between income and a
reserve. However the result must be in harmony with the purpose
of the legislation, which is, in the words of La Forest, J. cited
above, to shield Indians from any efforts by non-natives to
dispossess Indians of the property which they hold qua
Indians, i.e., their land base and the chattels on that land
base. That same judge also cautioned that, one must guard
against ascribing an overly broad purpose to ss. 87 and 89. I
would add that one must guard against stretching too far the
connection between income and a reserve, otherwise this approach
would be tantamount to giving Native people a tax exemption
"qua Natives" (which would be contrary to the teachings
of Mitchell) and not qua Natives holding property on a
reserve.
[80] This brings me to one last comment. I do not think that
the wording of section 87 of the Act with respect to
personal property which constitutes intangible property is clear
and readily comprehensible. It is, in my view, objectionable that
an income tax exemption should be worded in such vague terms. The
interpretation of that section requires such a subjective
balancing of connecting factors to determine the situs of
income - first by civil servants and then by the courts
- that it is bound to give rise to uneven application.
Furthermore, a person should be able to determine as much as
possible his or her tax liability without having to resort to
making time-consuming representations and without incurring
heavy expenses. In this case, Ms. Adams had two
well-prepared counsel who not only spent two days and a
half in court but who provided well-researched
written submissions. Taxpayers are entitled to clear charging and
exempting provisions. The fact that both civil servants and the
courts are trying to be as fair as possible to Native people
should not detract from efforts at finding a statutory solution
to a situation which could create inequity between Native
taxpayers thereby fostering resentment.
[81] For all these reasons, Ms. Adams is not entitled to
the exemption provided for in section 87 of the Act
and her salary is taxable under the Income Tax
Act.
[82] The appeal is dismissed.
Signed at Ottawa, Canada, this 15th day of November 1999.
"Pierre Archambault"
J.T.C.C.
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