McDiarmid Lumber Ltd. v. God's Lake First Nation et al., (2005) 192 Man.R.(2d) 82 (CA)

• Judge: Scott, C.J.M., Philp and Hamilton, JJ.A.
• Court: Court of Appeal (Manitoba)
• Case Date: December 02, 2004
• Jurisdiction: Manitoba
• Citations: (2005), 192 Man.R.(2d) 82 (CA);2005 MBCA 22

McDiarmid Lumber v. God's Lake Nation (2005), 192 Man.R.(2d) 82 (CA);

    340 W.A.C. 82

MLB headnote and full text

Temp. Cite: [2005] Man.R.(2d) TBEd. FE.009

McDiarmid Lumber Ltd. (plaintiff/appellant) v. God's Lake First Nation, a.k.a. God's Lake Band (defendant/respondent) and the Attorney General of Canada (intervener)

(AI 04-30-05953; 2005 MBCA 22)

Indexed As: McDiarmid Lumber Ltd. v. God's Lake First Nation et al.

Manitoba Court of Appeal

Scott, C.J.M., Philp and Hamilton, JJ.A.

February 14, 2005.

Summary:

A judgment creditor caused a notice of garnishment to be issued respecting a First Nation/Indian Band's bank account at a trust company in Winnipeg. The Band moved to set aside the notice of garnishment. A Master held that most of the funds in the bank account were exempt from garnishment under s. 90(1)(b) of the Indian Act. The judgment creditor appealed.

The Manitoba Court of Queen's Bench, in a decision reported at 186 Man.R.(2d) 31, dismissed the appeal. The judgment creditor appealed.

The Manitoba Court of Appeal allowed the appeal, set aside the order below and dismissed the Band's application for an order setting aside the notice of garnishment.

Constitutional Law - Topic 6350

Federal jurisdiction (s. 91) - Indians and land reserved for Indians - General - [See third Creditors and Debtors - Topic 4405 ].

Creditors and Debtors - Topic 4405

Garnishment by creditor - Exemptions - Indian property - A judgment creditor caused a notice of garnishment to be issued respecting a First Nation/Indian Band's bank account at a trust company in Winnipeg - Most of these funds were obtained by the Band from the federal government under a comprehensive funding arrangement (CFA) - The Band moved to set aside the notice of garnishment - A motions judge held that these funds were personal property situated on a reserve and exempt from garnishment pursuant to s. 89 of the Indian Act - There was a discernable nexus between the funds and the Indian occupation of reserve land - The funds provided to the Band under the CFA were essential for the Band to continue to occupy its reserve - The Manitoba Court of Appeal allowed the judgment creditor's appeal - The court reviewed the case law and concluded that, whether one applied the common law situs principles or the connecting factors test from William v. Canada (S.C.C.), the funds on deposit at the trust company in Winnipeg were not property situated on a reserve - Therefore, the funds were not exempt from garnishment under s. 89 - See paragraphs 21 to 91.

Creditors and Debtors - Topic 4405

Garnishment by creditor - Exemptions - Indian property - A judgment creditor caused a notice of garnishment to be issued respecting a First Nation/Indian Band's bank account at a trust company in Winnipeg - Most of these funds were obtained by the Band from the federal government under a comprehensive funding arrangement (CFA) - The Band moved to set aside the notice of garnishment, arguing that the funds were exempt from garnishment under s. 90(1)(b) of the Indian Act (i.e., personal property given to it under a treaty or agreement with the federal government ancillary to a treaty that was deemed to be located on the reserve) - A motions judge held that the funds in question constituted personal property within the meaning of s. 90 - The Manitoba Court of Appeal allowed the judgment creditor's appeal - It was a chose in action (a debt owned by the trust company to the Band), not money, which was garnished - It was this Band "asset", payable on demand, that was the subject matter of the garnishing order - Although the funds provided by the CFA were an essential component of the band's ability to continue operation of the reserve, that did not convert such funding arrangements into a "treaty or ancillary agreement" - There was insufficient evidence to link the CFA to any treaty - See paragraphs 92 to 132.

Creditors and Debtors - Topic 4405

Garnishment by creditor - Exemptions - Indian property - A judgment creditor caused a notice of garnishment to be issued respecting a First Nation/Indian Band's bank account at a trust company in Winnipeg - Most of these funds were obtained by the Band from the federal government under a comprehensive funding arrangement (CFA) - The Band moved to set aside the notice of garnishment - A motions judge allowed the motion - The judgment creditor appealed - The Manitoba Court of Appeal held that the motions judge erred in his conclusion that the CFA reflected the federal government's responsibilities for Indians and lands reserved for Indians under s. 91(24) of the Constitution Act, 1867 and therefore, was covered by s. 90 of the Indian Act - The motions jude was wrong in concluding that the funds deposited in the Band's bank account were deemed always to be situated on an Indian Reserve and therefore not attachable - Section 91 of the Constitution Act did not create a legal obligation on the part of the federal government - See paragraphs 136 to 139.

Indians, Inuit and Métis - Topic 822

Personal or legal rights - Property exempt from alienation - Personal property - What constitutes - [See second Creditors and Debtors - Topic 4405 ].

Indians, Inuit and Métis - Topic 823

Personal or legal rights - Property exempt from alienation - Situated on a reserve - Meaning of - [See first and third Creditors and Debtors - Topic 4405 ].

Cases Noticed:

Williams v. Minister of National Revenue, [1992] 1 S.C.R. 877; 136 N.R. 161, refd to. [para. 12].

Williams v. Canada - see Williams v. Minister of National Revenue.

Mitchell and Milton Management Ltd. v. Peguis Indian Band et al., [1990] 2 S.C.R. 85; 110 N.R. 241; 67 Man.R.(2d) 81, refd to. [para. 16].

Houston v. Standingready et al., [1991] 1 W.W.R. 744; 88 Sask.R. 316 (C.A.), refd to. [para. 26].

McDiarmid Lumber Ltd. v. God's Lake First Nation (2004), 189 Man.R.(2d) 192; 2004 MBQB 266, refd to. [para. 28].

Nowegijick v. Minister of National Revenue et al., [1983] 1 S.C.R. 29; 46 N.R. 41, refd to. [para. 30].

Union of New Brunswick Indians and Tomah v. New Brunswick (Minister of Finance) et al., [1998] 1 S.C.R. 1161; 227 N.R. 92; 200 N.B.R.(2d) 201; 512 A.P.R. 201, refd to. [para. 31].

Sero v. Minister of National Revenue, [2004] 2 F.C.R. 613; 315 N.R. 162; 2004 FCA 6, leave to appeal dismissed [2004] S.C.C.A. No. 88 and [2004] S.C.C.A. No. 89, refd to. [para. 37].

Workers' Compensation Board (Alta.) v. Enoch Indian Band et al. (1993), 141 A.R. 204; 46 W.A.C. 204; 106 D.L.R.(4th) 279 (C.A.), refd to. [para. 41].

Canadian Imperial Bank of Commerce v. E. & S. Liquidators Ltd., [1995] 1 C.N.L.R. 23 (B.C.S.C.), refd to. [para. 41].

Tycholiz v. Waterhen Indian Band (1997), 120 Man.R.(2d) 61 (Q.B.), refd to. [para. 41].

Ferguson Gifford v. Lax Kw'Alaams Indian Band et al., [2000] B.C.T.C. 102; [2000] 2 C.N.L.R. 30; 72 B.C.L.R.(3d) 363; 2000 BCSC 273, refd to. [para. 41].

Williams v. Minister of National Revenue, [1989] 2 F.C. 318; 24 F.T.R. 169; 24 C.C.E.L. 119; 89 D.T.C. 5032; [1989] 1 C.N.L.R. 184; [1989] 1 C.T.C. 117 (T.D.), revd. [1990] 3 F.C. 169; 109 N.R. 223; 72 D.L.R.(4th) 336; 32 C.C.E.L. 1; 90 D.T.C. 6399; [1990] 2 C.T.C. 124; [1991] 2 C.N.L.R. 172 (F.C.A.), refd to. [para. 51].

Francis v. R., [1956] S.C.R. 618, refd to. [para. 63].

R. v. Sellars, [1980] 1 S.C.R. 527; 32 N.R. 70, refd to. [para. 67].

Reference Re Remuneration of Judges of the Provincial Court (P.E.I.), [1997] 3 S.C.R. 3; 217 N.R. 1; 206 A.R. 1; 156 W.A.C. 1; 121 Man.R.(2d) 1; 158 W.A.C. 1; 156 Nfld. & P.E.I.R. 1; 483 A.P.R. 1, refd to. [para. 67].

Nathanson, Schachter & Thompson v. Whitney et al. (No. 1), [1994] 6 W.W.R. 203; 43 B.C.A.C. 81; 69 W.A.C. 81 (C.A.), refd to. [para. 97].

Minister of National Revenue v. Kakfwi (1999), 247 N.R. 274; 99 D.T.C. 5639 (F.C.A.), leave to appeal denied (1999), (2000), 257 N.R. 396 (S.C.C.), refd to. [para. 97].

Desnomie v. Minister of National Revenue (2000), 254 N.R. 58 (F.C.A.), refd to. [para. 97].

Adams v. Canada, [1999] T.C.J. No. 793, refd to. [para. 97].

Westbank Indian Band v. Robertson et al. (1990), 36 F.T.R. 286 (T.D.), refd to. [para. 118].

Royal Bank of Canada v. White Bear Indian Band et al. (1991), 88 Sask.R. 289 (Q.B.), refd to. [para. 118].

Young v. Wolf Lake Indian Band et al. (1999), 164 F.T.R. 123 (T.D.), refd to. [para. 118].

Sturgeon Lake Indian Band v. Tomporowski Architectural Group Ltd. (1991), 95 Sask.R. 302 (Q.B.), refd to. [para. 118].

Fayerman Brothers Ltd. v. Ballantyne (Peter) Indian Band et al., [1986] 1 C.N.L.R. 6; 36 Sask.R. 76 (Q.B.), refd to. [para. 119].

Fricke and Seaton Timber Ltd. v. Mitchell et al., [1986] 1 W.W.R. 544; 67 B.C.L.R. 227; [1986] 1 C.N.L.R. 11 (S.C.), refd to. [para. 119].

Webtech Controls v. Cross Lake Indian Band, [1991] 3 C.N.L.R. 182 (Man. Q.B. Master), refd to. [para. 120].

Brooks (J.E.) & Associates Ltd. v. Kingsclear Indian Band et al., [1992] 2 C.N.L.R. 46; 118 N.B.R.(2d) 290; 296 A.P.R. 290 (C.A.), refd to. [para. 122].

Moysa v. Labour Relations Board (Alta.) et al., [1989] 1 S.C.R. 1572; 96 N.R. 70; 97 A.R. 368, refd to. [para. 135].

Peel v. Canada, [1992] 3 S.C.R. 762; 144 N.R. 1; 59 O.A.C. 81; 12 M.P.L.R.(2d) 229, refd to. [para. 136].

Statutes Noticed:

Indian Act, R.S.C. 1985, c. I-5, sect. 89(1), sect. 90(1)(b) [para. 3].

Authors and Works Noticed:

Hogg, Peter W., Constitutional Law of Canada (4th Ed. 1997) (Looseleaf), vol. 2, c. 56, pp. 21, 21 [para. 134].

Counsel:

B.A. Johnstone and J.A. Mercury, for the appellant;

G.J. Orle, Q.C., and D.A. Chicoine, for the respondent;

D.R. Davis, for the Intervener.

This appeal was heard on November 29 and December 2, 2004, before Scott, C.J.M., Philp and Hamilton, JJ.A., of the Manitoba Court of Appeal. Scott, C.J.M., and Philp, J.A., delivered the following judgment for the court on February 14, 2005.