Drug addicts and harm reduction advocates hugged and cheered in the streets of Vancouver's Downtown Eastside Friday morning after the Supreme Court of Canada ruled in favour of the city's controversial supervised injection site.

Standing outside the Insite building on East Hastings Street, current and former drug users credited the facility with sparing them from disease and hospitalization, and, in some cases, for leading them down the difficult process of recovery.

"I can honestly say that I probably wouldn't be alive right now if it wasn't for Insite," said Cindy, a client of the facility.

"There's no way we should close a place like this down. They really should extend it all across Canada," said Ron, a drug user currently in treatment. "It is a huge victory. I'm grateful, really grateful."

The court ruled 9-0 Friday against the federal Conservative government's attempts to close Insite in a precedent-setting ruling on the division of federal and provincial powers.

"The experiment has proven successful," Chief Justice Beverley McLachlin wrote on behalf of the unanimous court. "Insite has saved lives and improved health without increasing the incidence of drug use and crime in the surrounding area,"

As many as 800 drug users a day visit the facility to use its 12 booths to inject drugs with clean needles. Insite's supporters have amassed a number of peer-reviewed studies that found it prevents overdose deaths, reduces the spread of disease, curbs crime and curtails open drug use.

The Supreme Court ruling also dispels the misconception that the facility provides illegal drugs to addicts, noting that it instead offers "health care information, counselling, and referrals to various service providers or an on-site, on demand detox centre."

It points out that the decision is not a licence for users to possess drugs anywhere they please.

The justices flatly rejected the Harper government's argument that the facility fosters addiction and runs counter to its crime-busting agenda, and ordered it to continue granting the exemptions to federal drug laws that have allowed Insite clients to avoid facing drug possession charges since 2003.

Health Minister Leona Aglukkaq said the federal government is disappointed and wants a review of the decision, but will comply with the ruling.

Insite an 'icon of our collective humanity'

At a press conference Friday morning, Insite executive director Liz Evans thanked everyone who has supported the facility, from AIDS researchers to unions to the past five Vancouver mayors.

She said the facility is a small but important step in changing the way society views addiction and addicts themselves, calling Insite "an icon of our collective humanity."

"It welcomes people who are broken, it allows all of us to heal together and today we can celebrate a victory that allows us to continue this work," Evans said. "Here, people have found access to detox, they've found housing, they've found access to methadone and clinical treatments, and more important than all of that they've found human kindness."

Justice McLachlin made clear in the ruling that the federal government has a right to set policy, but when policy is translated into state action and law the courts must determine their validity under the Charter of Rights and Freedoms.

"The discretion vested in the minister of health is not absolute; as with all exercises of discretion, the minister's decisions must conform to the charter."

The ruling represents a significant setback for the Conservative crime agenda and could lead to the creation of other safe-injection sites in major cities.Victoria has already expressed interest, and Vancouver Mayor Gregor Robertson says he would support more sites within the city if the health authority can demonstrate a need.

The political ramifications of the decision quickly resonated well beyond the borders of Vancouver's impoverished Downtown Eastside.

New Democrat MP Libby Davies, whose riding includes Insite, immediately called on the Harper government to abandon its ideological opposition to the facility.

"I don't believe any of them ever went there, they never took the time to really find out what Insite was about," she said.

"They always took this political, partisan, ideological position. And I want to say to them, have you now understood and learned the importance of what Insite is about, and how it's so much a part of our community?"

Friday's ruling was applauded by Vancouver Mayor Gregor Robertson, who called it a "real vote of confidence in the community and in science."

The Canadian Medical Association also welcomed the decision on Twitter and through a statement asserting that physicians' support for Insite was based on "the autonomy to make medical decisions based on evidence."

"The evidence shows that supervised injection reduces the spread of infectious diseases and the incidence of overdose and death," CMA president Dr. John Haggie wrote.

The federal government began the process to end Insite's exemption in 2006. It argued the fight against drug addiction would be better focused on prevention and treatment, as well as tougher laws to curb drug dealing.

The Portland Hotel Society, which operates the site, filed suit in 2007 to keep the centre open, arguing its closure would be a violation of Insite users' rights, because without the site, they would be at risk of a fatal overdose.

The B.C. Supreme Court sided with the Insite team. When the federal government appealed to the B.C. Court of Appeal, the decision was upheld. So in February 2010, Ottawa appealed the ruling to the Supreme Court.

With files from CTV.ca and The Canadian Press