The King v. Roger Miller & Sons, Ltd.

ments as well as to the other matter to which reference was made so often on the argument, namely, the expenditure of three hundred and thirty million dollars by the Parliament of Canada in constructing or aiding the lines now forming the Canadian National Railways, and the desire of the Government, as expressed in the Order in Council, to encourage the movement of traffic through Canadian ports, the obligation still rests upon the Board of fixing rates which are " fair and reasonable " from the standpoint not only of the producer but also from the point of view of L the Railways.

Has it been made to appear on this application that it is fairly arguable that the rates fixed by Order No. 448 are unfair or unreasonable? I am very clearly of opinion that it has not. Not only have the Canadian National Railways failed to shew that the Board misdirected itself, but their own conduct since the Order was made has been such as to justify the inference that, in their judgment, the rates were not unfair or unreasonable.

The application will be dismissed with costs.

J.-The respondents entered into a contract with the Department of Public Works on the 10th of March,

1919, to do certain work in connection with Toronto Harbour improvements, and to furnish the labour, materials, machinery, equipment facilities and supplies necessary for the completion of the work, for which they were to be paid the net cost plus 71o, in addition to a rental for machinery or plant described in the contract, at the rates therein stipulated.

The respondents proceeded with the work in 1919 under the directions of the Department Engineer, pursuant to the contract, but at the beginning of the following season the Department commenced negotiations to secure better terms of contract with the respondents, and in the meantime suspended operations.

These negotiations resulted in a new contract, dated 12th August, 1920, under which the work proceeded, and which provided that respondents were to be paid as therein provided, both for the work already done and for the work to be done, so that the terms of the original contract are not material to the matters in question here.

The main dispute is as to an item of $47,298.21 allowed the respondents by the learned trial judge for rental of plant in excess of what the appellant claims to be the proper amount. The agreement of 12th August, 1920, has the following provisions in reference to rental of plant:

F. Hands, the Department engineer in charge of the work, says that his practice was at the commencement of the season's work to instruct the contractors to put on the work the plant that he considered necessary for the operations, and that plant remained on the work, with few exceptions, continuously throughout the working season. This plant, he says, would all be employed constantly or intermittently throughout the season, and when a unit was put to work and then ceased to work for a month or so and then was put to work again, he did not strike it off the rental sheet, but when a unit became unnecessary for a substantial period during the season, he struck it off the rental sheet while idle. The amount of rental that the Department claims to be the correct amount is arrived at on this basis.

The respondents claim that they are entitled to rental for the full season for all the plant while it remained on the work until the engineer determined that some unit or units were no longer required on the work, and released them, so that respondents would be entitled to take them away and employ them elsewhere, and that until the engineer so determined, the plant was " retained " by the Department within the meaning of the terms of the contract quoted above.

Having regard to the nature of the work to be done and its requirements as to plant described in the contract, the respondents' interpretation of the meaning of the language used in the clauses quoted above seems to be correct. Units of the plant described, such as dredges with their attendant tugs and scows, derrick scows with air compressor and electric plant, diving scow with air compressor equipment and electric light plant, concrete mixer with boiler, sand and gravel bins, travelling derricks, pile drivers, etc., could not with any degree of practicability be moved about for short periods from this particular work to some other similar work and then brought back again when required. The words of the contract, " cease when determined by the Engineer on the following basis, & namely," and " the plant be retained or used," employed in connection with such an undertaking and the plant to be used in carrying it out are significant of what was intended. The plant that remained on the work throughout was kept there because it was required for the undertaking, and was therefore " retained," and the engineer accordingly did not " determine " that it should be released so that rental should cease.

A time did arrive when certain small units, such as motor boats, were not further required, and the engineer as to these did " determine " that rental as to them should cease, and released them, so that they were no longer " retained or used," and rental for them ceased.

Nothing seems to turn on the fact that the part of the plant closed in by the coffer-dam was idle during the first part of the season of 1920. This plant was placed there in 1919, and worked there in that season under the contract. The Department chose to suspend work while negotiating for better terms, but did not " abandon the work and cancel the contract," as provided by one of its terms. The respondents were not at liberty to remove their plant, because they were under contract to supply this plant, and they might have been required at any moment to proceed with the work.

As to the determination of the contract, dated 10th

March, 1919, authorized by the Order in Council of 17th

February, 1919, there need be no misunderstanding. The

Government, by the provisions of the 12th clause, reserved the right, if deemed advisable or necessary, to " abandon the work and terminate the contract."

There is an Order in Council of 18th March, 1920, which provides,

And, in the appellant's factum, it is stated that, " By Order in Council dated 18 March, 1920, the said contract with the respondents was cancelled " (meaning thereby the contract of 10th March 1919).

This Order in Council, however, so far from providing for the abandonment of the

S.C.R.]

work, expressly provides for its continuance, under a new contract to be made with the respondents, which was accordingly entered into on the 12th day of August, 1920. &

In the new contract it is recited:

and this recital is followed by a mutual release and discharge of the contract; but it is, however, provided, at the foot of the 8th clause, that

By the statement of defence,

At the opening of the case, however, we were informed by the appellant's counsel that the contract had not been cancelled. It seems clear that the Order in Council of 18th March, 1920, could not effectively cancel the existing contract, as clause 12 authorizes such cancellation only on the abandonment of the work, whereas the Order in Council expressly provides for continuance of the work by the respondents. Moreover, there is no evidence that the respondents had any notice of this Order in Council prior to the execution of the new contract. The appellant cannot therefore base any claim for reduction of rental on the alleged cancellation of the contract.

The contention of the appellant as to the basis on which rental of the plant is to be calculated is not therefore well founded, because there was no " determination " by the engineer that rental claimed should cease, and because the plant for which the rental is claimed was " retained." It is conceded that in the event of the contract being construed as indicated above, the item of $47,298.21 was correctly allowed. The appeal as to this is therefore dismissed. The only other amount in question here is the item of $10,937.71 allowed by the learned trial judge to the respondents for interest on moneys not paid to the respondents at the times stipulated in the contract.

The total sum claimed by the respondents for interest was $28,700.16,