The case was decided by the Judicial Committee of the Privy Council, at that time the court of last resort for Canada within the British Empire.

The Judicial Committee allowed an appeal from the Supreme Court of New Brunswick and held that the legislation was within provincial jurisdiction as a matter of local taxation, coming under sections 92(2) and 92(16) of the Constitution Act, 1867.

The general sessions of the County of Charlotte then laid the necessary assessment on the residents of St. Stephen to pay the interest on the debentures.

In Trinity term 1872, the Supreme Court granted an interim rule nisi to quash the warrant of assessment.

On February 22, 1873, in a 3-1 decision the Court held that the Act was unconstitutional and granted a rule absolute to quash the warrant of assessment.

He held that there was no doubt that the railway extended beyond the province of New Brunswick, and therefore fell under exclusive federal jurisdiction under the combined effect of s. 92(10)(a) and s. 91(29) of the Constitution Act, 1867.

Since the purpose of the provincial statute was to provide for the construction and completion of a railway extending beyond the limits of the province, it fell within federal jurisdiction.

[12] The supporters of the railway proposal then appealed to the Judicial Committee of the Privy Council, at that time the court of last resort for Canada within the British Empire.

It simply enabled the majority of the inhabitants of the parish of St. Stephen to raise a subsidy for the railway by local taxation.

Alternatively, even if the tax did not fall within s. 92(2), it would clearly be a law of a local or private nature within the meaning of s. 92(16) of the Constitution Act, 1867, and therefore within provincial authority on that basis.

[17][18] Following the abolition of Canadian appeals to the Judicial Committee, the Minister of Justice and Attorney General of Canada directed the Department of Justice to prepare a compilation of all constitutional cases decided by the Judicial Committee on the construction and interpretation of the British North America Act, 1867 (now the Constitution Act, 1867), for the assistance of the Canadian Bench and Bar.