A court case looming over Atlantic Canada's inshore fisheries is now in the hands of a Federal Court of Canada judge.

Justice Cecily Strickland reserved her decision Wednesday after two days of legal arguments in an Ottawa courtroom that centred on whether the minister of fisheries has the power to manage the fishery for social and economic objectives outside of fish conservation.

Labrador fisherman Kirby Elson is appealing a 2015 decision by the minister to take away his snow crab licence because he refused to exit a controlling agreement with two fish processors, one that allowed them to control the licence and the wealth it generated.

The Department of Fisheries and Oceans says such agreements are an end run around its policies that individual fishermen — not corporations — are the beneficiaries of inshore licences.

Kirby Elson

The case brought forward by Kirby Elson, centre, has important ramifications for the independence of the inshore fishery. (CBC)

Surprise claim made in court

While lawyers for Elson and Ottawa were at odds over ministerial authority, both agreed during the hearing that Elson was the last fisherman with a controlling agreement.

It was an assertion that "shocked" observer Robert Keenan, who was sitting in on the case for a fisheries workers union.

"The people who control Elson's licence put him forward as a case in order to test the validity of the DFO policy. He is not the last one, not by a long shot," Keenan said.

In fact, the Department of Fisheries and Oceans has acknowledged as much.

Decision carries big implications

It has beefed up enforcement and audits of licences, and last year said it found two Maritime fishermen remained in controlling agreements despite Ottawa's formal ban.

"There are probably hundreds of controlling agreements still out there," said Keenan.

If Elson loses the case, he said, DFO will be pressured to do more to root out controlling agreements that remain in place, despite the requirement from licence holders to declare that they are not in one.

Determining the powers of the minister

But that was not the issue before Strickland. She must decide if — as Elson's lawyers assert — the fisheries minister had no constitutional authority to interfere with what was essentially a private business contract.

"The effect of the DFO measure is to frustrate the rights of licence holders and counter parties to trade and carry on business, which is a matter of property and civil rights," lawyer Byron Shaw told the court Wednesday.

Elson also argued he was treated unfairly by the department, which did not adequately take into account his personal circumstances. The 62-year-old said the controlling agreement was the only way he could pursue his livelihood as a fisherman.

No proof of hardship

Both claims were challenged in court by federal lawyer Anna McConnvile, who said Elson had the opportunity to put forward evidence of his hardship but did not.

She also argued the minister has the right to manage the fishery in the public interest and to achieve social and economic objectives.

Keenan also dismisses the constitutional argument that the minister's powers are limited.

"In order to be a fish harvester, the minister dictates how you have access to the resource, the size of the boat, the type of gear — all sorts of aspects about how a harvester carries on his trade," he told CBC News on Wednesday.

"To say all other aspects of a harvester can be dictated but who benefits cannot be, that's a bit of a stretch."

DFO Maritimes regional director Morley Knight, who has attended the proceedings to watch, declined comment.