Judgment of the Court
THE CHIEF JUSTICE-The respondents were convicted of the murder of Yoshyuki Uno in Vancouver on the 16th of January, 1942. The act of shooting by which it is alleged the murder was effected was, it is charged, the act of the respondent Hughes; the other respondents were charged and found guilty as conspirators with Hughes and, as such, responsible for the crime.
I shall deal first with the case of Hughes. The evidence shows that on the date mentioned Hughes with two companions entered the shop kept by the father of the victim (1) (1942) 78 Can. Cr. C. 1; [19411 3 W.W.R. 1; [1942] 3 D.L.R. 391. at 305 West 4th Ave., Vancouver, for the purpose of robbery. The family, his wife, the mother of the victim, a daughter, the victim and another son, lived with him in the rear of the shop which was separated from a sitting room, or living room, by what is called a half door with curtains on the store side extending to the floor. There Dufu. is a bell which rings in the sitting room when the street door of the store opens.
On the occasion with which we are concerned Mr. and
Mrs. Uno were sitting in the sitting room with the deceased son and the other son and daughter. The store bell having rung, the father left the room for some reason and the mother entered the shop. She says Hughes was carrying a revolver and she uttered some expression which gave a warning to the family in the sitting room that a hold-up was in progress. They had formerly gone through the same experience and this expression was understood.
Mrs. Uno says that Hughes went immediately toward the curtains of the door leading into the sitting room and, as he approached, he fired a shot which passed through the wooden partition at the side of the doorway. When he got to the curtains he fired another shot through the curtains. The first of these shots wounded Yoshyuki Uno in the hand and the second in the arm. Yoshyuki immediately came into the store and grappled with Hughes in an effort to disarm him. The brother and the mother were in the store at this time together and the brother agrees with the mother that this struggle took place. Their accounts, however, of the actual shooting of the victim do not agree. The brother says that Hughes broke away from Yoshyuki and left the shop and, just as he was opening the door turned and fired at Yoshyuki a third shot which took effect in his head and killed him. The mother says that in the struggle Yoshyuki was attempting to take the pistol from Hughes " but could not reach because he was quite high
She adds:- She says that while they were struggling she heard a shot and afterwards did not hear another, that after the shot her son fell down and Hughes made off.
She distinctly remembers one shot fired during the struggle but heard no later shot.
It ought to be observed perhaps that the brother's evidence, while generally agreeing with his mother's statement that there was a struggle, is to the Df effect that Yoshyuki "had Hughes' wrist raising it up in the air ".
If the jury accepted the brother's account the shooting they had before them, of course, a plain case of murder.
The controversy turns entirely upon the alternative hypothesis that the third shot occurred during the struggle, as the mother says.
The majority of the Court of Appeal have held that it was open to the jury, if they took a certain view of the evidence, to find that the pistol went off by accident in the sense that it was not discharged by any act of Hughes done with the intention of discharging it, and that if they so found they might properly have brought in a verdict of manslaughter and that the learned trial judge erred in not leaving that issue to them.
The Crown appeals.
The jury would view the acts of Hughes from the moment Mrs. Uno entered the shop as swiftly succeeding phases of a single outrage and without doubt as evincing a reckless disregard of the consequences of his shooting, and they would be quite justified in ascribing to him a knowledge that his conduct was endangering the lives of the people whose premises he was invading.
They might not improperly infer that the shot which occurred during the struggle (if they accepted the mother's story), following at once upon the two shots fired into the sitting room, was intentionally fired by him in that state of mind. If that was their conclusion, it would be their duty to find him guilty of murder under section 259 (d) of the Criminal Code. I think the learned trial judge in effect instructed them in this sense.
He also properly instructed them that they might find the same verdict if they accepted the evidence of the brother.
Unfortunately, he did not deal with the third hypothesis, the possibility that they might find the pistol was discharged by accident in the sense mentioned.
The Crown adduced in evidence against the accused the testimony of one Ciminelli, who deposed to an account of the shooting given to him by Hughes in a conversation on the evening of the date of the crime, the 16th of January, In examination in chief Ciminelli said that Hughes HU told him on that occasion that the Jap came for fiim and struggled with him and then and the gun went off.
On cross-examination Ciminelli said that on the preliminary hearing he had given this version of the conversation:- Q. What was the conversation?
A. He told me that he was in a jam. Q. What kind of a jam?
A. He told me he took some store, and the guy came for him, and struggled with him, and the gun accidentally went off.
Q. Do you remember giving that evidence? A. That is right. Q. Your recollection was clearer then than it is to-day, I take it? A. That is right.
As Parke J. said in Rex v. Higgins (1):- Now, what a prisoner says is not evidence, unless the prosecutor chooses to make it so, by using it as a -part of his case against the prisoner; however, if the prosecutor makes the prisoner's declaration evidence, it then becomes evidence for the prisoner, as well as against him; but still, like all evidence given in any case, it is for you to say whether you believe it.
If the jury accepted Ciminelli's version of Hughes' statement given at the preliminary hearing (" that the gun accidentally went off") as a true account of that statement, then that statement in its complete form was evidence in favour of the accused.
It was, of course, for the jury to consider whether this statement, having regard to all the other evidence before them, satisfied them that the pistol in fact went off by accident and not by the voluntary act of Hughes, or that it was only of sufficient weight to leave their minds in a state of doubt on the point. If the jury thought the pistol did not go off by the voluntary act of Hughes, or were in serious doubt about it, then another question might arise; and here emerges the real point for decision on this appeal.
Before stating that point, I quote subsection (2) of section 252 and subsection (d) of section 259 of the Criminal Code:- Section 252 (2): Homicide is culpable when it consists in the killing of any person * * * by causing a person, by threats or fear of violence, or by deception, to do an act which causes that person's death * * * (1) (1829) 3 C. & P. 603. at 604, also cited by the Chief Justice in Eberts v. The King (1912) 47 Can. S.C.R. 1, at
Section 259: Culpable homicide is murder.
THEKNo
(d) If the offender, for an unlawful object, does an act which he knows or ought to have known to be likely to cause death, and thereby BnAMY, kills any person, though he may have desired that his object should be effected without hurting any one.
I think I ought to say now, in the clearest terms, that, in my opinion, even if the jury thought the pistol went off by accident (or were not satisfied that it did not go off in that manner) they might still have properly found a verdict of murder under these sections if they were satisfied that the conduct of the accused was such that he ought to have known it to be likely to induce such a struggle as that which actually occurred, and that somebody's death was likely to be caused thereby and that such was the actual effect of his conduct and of the struggle. At p. 583 of his judgment, delivered on behalf of the majority of the Court, in Graves v. The King (1), Anglin J. (as he then was) says:- For the purposes of this appeal I assume that under this provision it was not necessary, in order to bring the charge of culpable homicide within it, that the jury should have found that the acts of the defendants were such as they knew or should have known were likely to cause the very acts to be done or the precise situation to arise which in fact resulted in the homicide, or to cause the death of the person who was killed, but that it would suffice if the jury had found that the accused did an act which they knew or should have known would be likely to induce the doing of anything or to bring about any situation likely to cause the death of some person-the person killed or any other person.
I think this passage ought to be accepted as stating the law as it is, not merely as it is assumed to be. To repeat, I think the act of Yoshyuki in attempting to disarm Hughes and the ensuing struggle were so clearly the natural and ordinary consequences of Hughes' conduct that the jury might well, as reasonable men, have inferred that Hughes ought to have anticipated some such occurrence and the probable involuntary discharge of the pistol as a natural incident of the occurrence; it would then be for them to say whether the conditions of clause (d) of section 259, when read with subsection (2) of section 252, were fulfilled.
The learned trial judge did not put this to the jury explicitly, but possibly it is within the scope of his language.
(1) (1913) 47 Can. S.C.R. 568.
The learned judge, however, gave the jury to understand that the accused must be acquitted if they did not find them guilty of murder. I am forced to the conclusion that this was misdirection.
The argument on behalf of the Crown was based upon two decisions, Director of Public Prosecutions v. Beard DuCJ and Rex v. Elnick (2).
The rule laid down in the House of Lords in Beard's case (1) is that homicide arising from an act of violence in furtherance or in the course of the crime of rape constitutes murder. In Beard's case (1) it was proved that there was a violent struggle in which the accused overpowered the child and stifled her cries by putting his hand over her mouth and pressing his thumb upon her throat, the acts which, in her weakened state resulting from the struggle, killed her. This, the House of Lords held, was murder, although the accused had no intention of causing death.
I cannot agree that. you can bring within this rule the accidental discharge of the pistol admitted by Hughes. If the pistol went off accidentally, in the sense mentioned above, it could hardly be said as matter of law to be an act of violence done by the accused " in furtherance of or in the course of" the crime of robbery in the sense of the Lord Chancellor's judgment.
No question of accident in the relevant sense arose in Beard's case (1).
There was no question that the act which caused the suffocation, the act of the prisoner in placing his hand on the mouth of the victim, was his voluntary act. In the report of the case in the Criminal Appeal Reports (3), there appears this passage in the judgment of the Lord Chief Justice:- And at page 116:- THE KING
It was proved that there was a struggle of a horrible description U.
between this man, seeking to consummate his desire, and this years old girl. No questions were put in cross-examination by Mr. Artemus Jones for the defence, to minimize the effect of the testimony about the struggle that must have taken place. The child was straining every nerve and muscle to escape him, and in order to overpower her and to stop her struggles and screams he eventually did the act which resulted, in her death. By the law of England that is murder: it is an act of violence done in the course or in furtherance of a felony involving violence, and beyond all question and beyond the range of any controversy that is murder.
Again the judgment of the Lord Chancellor makes it quite clear that the defence founded upon drunkenness was not that Beard was so drunk as to be incapable of forming the intent to commit rape, but that he was incapable of measuring or foreseeing the consequences of his violent act, or that at the time of placing his hand on the child's mouth he was incapable of knowing that what he was doing was dangerous.
At p. 307 he says:- There was certainly no evidence that he was too drunk to form the intent of committing rape.
Under these circumstances, it was proved that death was caused by an act of violence done in furtherance of the felony of rape. Such a killing is by the law of England murder.
In this country a charge arising out of circumstances such as those considered in Beard's case (1) would be disposed of under the law laid down in section 260 of the Criminal Code.
As regards Rex v. Elnick (2), Mr. Justice Cameron says at p. 431:- The jury should have been told that on the undisputed and admitted facts the killing of De Forge was caused by an act of violence done by Elnick in furtherance of a crime of violence, that the killing was therefore murder and that it was their duty to return a verdict of guilty.
That is really the basis of the decision in that case. Such a direction could not properly have been given in this case, in view of the evidence set forth above as to accidental discharge.
The learned trial judge ought to have told the jury that they might and ought to find a verdict of manslaughter if they thought the pistol was not discharged by the voluntary act of Hughes, and that Hughes did not anticipate Man. R.
and ought not to have anticipated that his conduct might bring about a struggle in which somebody's death might be caused.
Mr. Justice Fisher thinks that on the evidence no reasonable jury could find that the discharge of the pistol was accidental, or that there was sufficient evidence to raise a doubt upon that point.
There is much, very much, to be said for that view; I am not satisfied, however, that if the issue of manslaughter had been left to the jury, they must necessarily have found the verdict they did.
I think the learned trial judge proceeded rightly in instructing the jury that in the circumstances of this particular case the law to be applied is to be found in the
He might well have called the attention of the jury to the second subsection of section 252 and to the judgment of Anglin J. in Graves v. The King (1).
As this Court thought in Graves v. The King (1), I am quite satisfied that the law to be applied to the circumstances of this case is to be found in the Code and that we need not pass upon the question whether the definitions in sections 252, 259 and 260 Cr. C. are exhaustive.
The appeal, therefore, from the judgment of the Court of Appeal, as it affects the conviction of Hughes, should be dismissed; and it follows necessarily that the appeal in respect of the other respondents must also be dismissed.
Appeal dismissed.
Payment by executors of succession duties
-Will giving bequests of specific sums and residuary bequest-Depreciation in value of estate owing to severe slump in stock market shortly after testator's death, causing insufficiency to pay bequests in full or anything on residuary bequest-Rates at which duties should be calculated-Duties paid based on net value of estate as at date of testator's death and at the rates appropriate to the different classes of beneficiaries, including the residuary legatee, as named in the will-Question whether payments made on wrong basis of computation under the circumstances and whether executors chargeable for overpayment.]-The question on the appeal was whether the executors of a deceased's will, who had paid amounts claimed by certain provinces of Canada for succession duties, were justified in having paid those amounts, or whether the duties had been paid according to a wrong basis of computation under the circumstances and consequently there had been overpayment for which the executors were chargeable. The deceased, residing in the province of Nova
Scotia, died on August 25, 1929, leaving a large estate consisting almost entirely of listed stocks and shares. His will made bequests of specific sums, directed a certain fund to be set aside for certain life interests and afterwards to revert to his estate, and bequeathed the whole of the residue to a university in the province of New Brunswick.
The will provided that no bequests (except income from said fund) be paid for three years after deceased's death, the expressed purpose being to allow the executors time to dispose of securities to the best advantage and not in a depressed market. The will contained no express instructions with regard to payment of succession duties. Shortly after the executors entered upon their duties and before they had realized any portion of the estate the stock market took an unprecedented and severe slump and the value of securities constituting the estate fell very much below the inventory values, with the result that the estate has ever since been insufficient to pay the legacies in full; all the general legacies had to abate and there was no residue. Between 1930 and 1936 the executors paid (from time to time as funds were available or were rendered available by sale of assets or by borrowings) to the Provinces of Nova Scotia, Ontario,
Quebec and British Columbia the succes- ADMINISTRATION
OF
ESTATES- Continued sion duties claimed to be payable in respect of all property passing under deceased's will. The payments were made on the footing that the amounts thereof constituted a charge upon the assets of the estate and that the executors were legally bound to pay them. The duties were paid on the basis of the net value of the estate as at the time of deceased's death and at the rates appropriate to the different classes of beneficiaries, including the residuary legatee, as named in the will. The Supreme Court of Nova Scotia in banco held M.P.R. 477) that the executors were not entitled to pay succession duties as so claimed; that they were entitled to pay succession duties based upon the rates applicable to the persons who receive property or beneficial interest in property from the estate and not at rates applicable to persons by whom no property or beneficial interest in property is received although such latter persons may have been named in the will. sole surviving executor appealed to this Court. Held (per the Chief Justice and Hudson and Taschereau J.; Crocket and Kerwin JJ. dissenting): The appeal should be allowed. The executors were justified in having paid out of the assets of the estate the claims as made for succession duties. The material statutory provisions considered were in the Nova Scotia Succession Duty Act (R.S.N.S., 1923, c. the material statutory provisions in other provinces to whom duty was paid being substantially the same. Per Hudson and Taschereau JJ.: The tax is primarily a property tax and is intended to be a direct burden on that property, varying in amount according to the ralationship of the successor to the testator. The tax is intended to be determined by the state of things existing at the date of the deceased's death. Agreement expressed with the following holding by Hall J., dissenting, in the Court below: It is the purpose and intention of the Act that the two factors necessary to determine the duty-valuation and rates-shall be constant. Irrespective of market fluctuations, duty shall be levied upon the fair market value (less deductions) at the date of death.
The rate is determined by the relationship or nature of the person for whose benefit property passed on the death. Computation is made by applying the appropriate rate to property passing to each person beneficially cn the testator's OF
ESTATES- Concluded death. The duty is paid on the basis of the distribution intended by the testator.
The executor deducts the amount which was payable on each legacy under s. (1)
of the Act. He must do this in order to carry on the administration of the estate.
He cannot discharge his functions as executor until he has freed the assets of the estate from the lien imposed for succession duties. Per Crocket J. (dissenting):
Property which "passes on the death of any person", within the meaning of the
Act, means property which changes hands at the death; it vests in the executor, though he has no beneficial interest in it;
it only actually "passes" to the beneficiary when it reaches him. It would be unreasonable and unjust to levy duty in respect.
of property that the beneficiary never received; and it should only be levied if the
Act in the clearest terms directed it. S.
(1) of the Act cannot possibly be construed as imposing any liability upon the beneficiary for succession duties upon any property which he has not received. In view of the facts of this case, the executors were not justified in paying out of the assets of the estate the succession duties they did, and which included an amount in respect of the residuary gift, which they fully realized, at the time of payment of duties, was of no value. Per
Kerwin J. (dissenting)
: The tax is imposed in respect of property "passing on the death." The executor is not liable for the payment of it, though he is required
(and is under penalty for failure) to deduct the duty before transferring to a legatee, etc., any property to which such person is entitled.
Apart from this, the only one liable is the person to or for whose benefit any property passes, under s.
It must be borne in mind that the Court is here dealing with general legacies of specific amounts, except, of course, the residuary bequest. The residuary legatee actually received nothing. It cannot be held that any legatees who actually received nothing, though the will mentioned a bequest of a large sum to him, should pay a tax. In the present case the executors acted unreasonably, particularly as they knew when they paid a great portion of the duties that the assets would not be nearly sufficient to pay all the legacies.
In re WILL
ADMIRALTY LAW.
See 1.....................19
AIR TRANSPORT COMPANY
APPEAL - Jurisdiction - Criminal law - Whether dissenting judgments in a court of appeal disclosed a dissent on a question of law within the meaning of section 1028 of the Criminal Code................ 2.-Claim for accounting - Matters of fact-Concurrent findings in courts below. ...... 3.-Functions of appellate court when dealing with verdict of jury-Collision of motor trucks-Questions as to negligence causing or contributing to accident-Findings of jury-Conclusiveness thereof unless verdict so wholly unreasonable as to show that jury could not have been acting judicially. ..................... 4.-to
Supreme Court of Canada on question of practice in Ontario...... 346 ASSESSMENT AND TAXATION-Mines and minerals
Owner of mineral land transferring surface rights-Non-assessability of his mining rights thereafter-Invalidity of subsequent tax sale in so far as purporting to affect mining rights-The Assessment Act, R.S.O., 1927, c. 288, ss. 40 (4) (5) (10), 181; R.S.O., 1987, c. 272, s. 14 (1), 15 (1)-The Conveyancing and Law of Property Act, R.S.O., 1927, c. 187, ss. 15, 16, 17.1-C., the owner of certain mineral land in Ontario, transferred to F. on December 30, 1930, by transfer registered on February 1931, the surface rights thereof, and thus, according to certificate of ownership issued under the Ontario Land Titles Act, became the owner in fee simple with an absolute title, of only the mines, minerals and mining rights of said land. The defendant township in 1939 purported to sell the land for taxes, and C. brought action attacking such sale in so far as it purported to affect his interests in the land. Held: (1) A settlement in an action brought in December, 1931, was, so far as C. was concerned, a settlement for all taxes for 1930 and 1931, and no lien for any taxes for those years against his interest in the land then remained; and in the subsequent years in question C. was not, nor were his mining rights, in fact assessed.
(2) After the severance of estates created by said transfer to F., C.'s mining rights-being ownership of the ores, mines and minerals, and such right of access for the purpose of winning them as is incidental to a grant of ores, mines and minerals-were not assessable. The Assessment Act, R.S.O., 1927, c. 238, s. 40 (4) (5) (the word "minerals", in the enactment in s. 40 (4) that "the minerals in, on or under such land shall not be assessable", held synony- Concluded mous with "mining rights"); The Conveyancing and Law of Property Act,
403, particularly referred to. As to ss.
(1) and (1) of The Assessment Act,
R.S.O., 1937, c. 272-The right of access was appurtenant to the minerals and, like the latter, was exempt from assessment.
There being no taxes on C.'s mining rights in arrears for any period for which they could be sold, s. of The Assessment
Act, R.S.O., 1927, c. 238, had no application. Judgment of the Court of Appeal for Ontario,
[19421
O.R.
affirming judgment of Roach J. (ibid) which (inter alia) declared that the tax sale in question, in so far as it included or purported to include C.'s estate or interest in the land, was illegal and void, affirmed.
TOWNSHIP V.
See TAX.
AUTHENTIC WRITING.
See WILL 2 ...................
AUTOMOBILES.
See Moroa
AVIATION-Carrier-Air transport company-Licensed air carrier of passengers- Forced landing-Injury to passengers and loss of baggage through negligence of company-Condition on ticket relieving company from liability-Validity of-Effect of fixing of fare by statutory regulation- Whether air company a "common carrier"
a "carrier" within definition enacted by Transport Act-Liability of company as common carrier-Transport
Act, 1938 (Dom.), 2 Geo. VI, c. 53, ss. 3,
BANKRUPTCY-Bankruptcy Act, R.S.C.,
Ontario legislation as to preferences superseded by s. 64 of Bankruptcy Act-B.N.A.
Act, s. 91.1-On April 5, 1939, B. gave to appellant a chattel mortgage on certain chattels in B.'s store to secure payment of indebtedness to appellant incurred by
B. in the course of business. On October
21, 1939, B. made an authorized assignment in bankruptcy.
Respondent, the trustee in bankruptcy, attacked the validity, as against it, of the security of the chattel mortgage. Held (reversing judg- BANKRUPTCY-Continued ment of the Court of Appeal for Ontario, [19411 O.R. 21): The chattel mortgage was not a "settlement" within the meaning of ss. 60 and 62 (3) of the Bankruptcy Act, R.S.C., 1927, c. and is valid and effectual as against respondent. The enactment in s. 62 (3) that, for the purpose of ss. 60, 61 and 62,. "settlement" "shall include any conveyance or transfer of property" does not so extend the ordinary meaning of the word "settlement" as to bring within its scope all conveyances or transfers of property. Per the Chief Justice and Davis and Kerwin JJ.: In enacting said sections Parliament adopted in substance provisions in the English Act which had been the subject of discussion and decision in the English courts, and it is proper to assume that Parliament intended to adopt those provisions as construed by the English courts and applied in the administration of the bankruptcy law in England; and the settled law in England had been that, although in the form of definition the words now in said s. 62 (3) purport to enlarge the meaning of the term "settlement", they must, by reason of the context, be restricted in their scope. Broadly speaking, the settled principle in England was that those words had not the effect of bringing within the scope of the term "settlement", as used in provisions corresponding to said ss. 60, 61 and 62, transactions which have none of the essential elements of a "settlement" as that term is commonly understood. Reading said ss. 60, 61 and 62 together with s. 64 (as to preference given to a creditor)
and considering these enactments in the light of the history of the law in relation to preferences, it must be held that such a transaction as that in question does not fall within the intendment of "settlement" as employed in said sections; it belongs to the class of transactions the validity of which is to be determined by the application of s. 64. The provisions of the Ontario Act, R.S.O., 1927, c. 162, in relation to preferences are superseded by s. 64 of the Bankruptcy Act, and the authority of the Ontario Legislature to enact such legislation is, in consequence of the enactment of said a. 64, suspended in virtue of the concluding paragraph of s. 91 of the B.N.A. Act. Per Rinfret and Crocket JJ.: Said ss. 60 and 62 are directed against a "settlement of property", and it is apparent that in using the word "settlement" Parliament intended to connote a particular kind of gift or grant, excluding other kinds. Secs. 60 and 62 were adoption of provisions in the English Act, and the construction of the word had been, settled in England and had there acquired an established meaning. A settlement in the ordinary sense of the word is intended; the transaction must be in the nature of a settle- BANKRUPTCY-Concluded meat, though it may be effected by a conveyance or transfer (In re Player, Ex parte
The transaction in question had not any of the necessary elements of a settlement.
(Doubt expressed whether an arrangement with a creditor may ever be considered a "settlement"; and inclination expressed to the opinion that, generally speaking, "settlement" involves the idea of a clear gift or that type of cases where provision is made for a trust of some sort.
It should not be taken to include an ordinary business transaction between a debtor and a creditor.)
THE A. H.
Co. v. THE
Co. In re
.............
BILL OF LADING.
CARRIER-Aviation-Air transport company-Licensed air carrier of passengers- Forced landing-Injury to passengers and loss of baggage through negligence of company-Condition on ticket relieving company from liability-Validity of-Effect of fixing of fare by statutory regulation- Whether air company a "common carrier"
-Whether a "carrier" within definition enacted by Transport Act-Liability of company as common carrier-Transport Act,
Vancouver to Zeballos, B.C., and, during the flight, a fire started on board forcing the plane to land.
The appellants lost their baggage and were severely injured.
They brought action against the respondent, an air transport company, alleging that the accident was caused by its negligence. The tickets issued by the respondents to each of the appellants were expressed to be subject to the conditions that the flight was at their own risk against all casualties to themselves or their property and that the respondent should in no case be liable to the passengers for loss or damage to the person or property of such passengers, whether the injury, loss or damage be caused by negligence, default or misconduct of the respondent, its servants or agents or other- CARRIER-Continued wise. The respondent was operating its air transport service under a licence issued under the authority of the Aeronautics Act, and it also held a licence issued by the Board of Transport Commissioners under the Transport Act, 1938. trial judge held that the term contained in the ticket, that passengers travelled at their own risk entirely, did not bind them; but the appellate court, reversing that judgment, held that the respondent was within its rights in issuing such special ticket. Held, affirming the judgment appealed from ([19421 1 W.W.R. 465), Kerwin and Taschereau JJ. dissenting, that the appellants' action was barred by the term of the special contract contained in the ticket and, therefore, the respondent was relieved of any liability towards them.-The respondent company (it being immaterial whether it should be regarded as common carrier) is a "carrier" within the definition contained in the interpretation section of the Transport Act, its licence was issued by the Board and the charge of $25 asked from and paid by each of the appellants was made in accordance with a special tariff duly filed with the Board. Such tariff therefore must be examined in the light of the Transport Act and of the general orders and regulations of the Board; and, as a result, it must be held that the respondent has complied with the provision of the Act and with these orders and regulations. The special tickets were issued to the appellants under a special tariff which, by the Act itself, is declared to "specify a toll or tolls lower than in the standard tariff," and the conditions of which were governed by regulations of the respondent deemed to have been assented by the Board, not having been disallowed by it, with special reference to the terms and conditions of these passenger tickets. It cannot be assumed, although not specifically established in evidence, that the Board allowed the special tariff and its regulations to come and to remain into force in the form in which they were made and filed by the respondent, without taking cognizance of the terms and conditions of the company's passenger tickets to which the schedules and regulations made special reference and which were stated to govern the liability of the company in respect of the transportation by it of its passengers.
The terms and conditions of the tickets were made part of the special tariff and schedules, and, accordingly, were valid and binding under the Transport Act and the general orders and regulations of the Board, the latter having full authority to allow the issue of passenger tickets in the form of the tickets issued to the appellants.-Section 348 of the Railway Act does not apply in the case of transport by air, that section hav- CARRIER-Concluded ing apparently been deliberately omitted in the Transport Act; but, even if it did apply, the form of the contract or ticket in issue in this case should be taken to have been authorized by the Board within the meaning of that section.-This case is governed by the decision of the Privy
Council in Grand Trunk Railway Co. v.
Robinson ([19151 A.C. 740). Per Kerwin and Taschereau JJ. (dissenting) terms and conditions on the back of the tickets, which excluded the respondent's liability for negligence, are void, and the judgment of the trial judge, maintaining the appellants' action, should be restored.
-The contract upon which the respondent relies is not in compliance with the provisions of the Transport Act and the
Board's order and regulations.-Moreover, whether or not section 25 of the Transport
Act, taken in conjunction with other provisions of the Act and the relevant parts of the Board's orders, constitutes the respondent company a common carrier of passengers at common law, the evidence disclosed that it held itself as being such;
and, if so, the contract absolving the respondent from its liability for negligence is invalid. As a common carrier of passengers, the respondent's duty was to take due care to carry its passengers safely; and the company is not entitled, at common law, to rely upon such a contract without having given the appellants the option of travelling at a higher fare without any such condition: Clarke v.West Ham Corporation ([19091 2 K.B. 858) approved.- The same result follows if no such common law liability exists. By force of the Transport Act, the licence issued to the respondent and the Board's orders, the repondent was under a statutory duty to carry at the only scheduled rate all unobjectionable passengers. This case should be decided upon the principle laid down in the following decisions which held that a company empowered by statute to construct works for the use of the public and to take tolls from persons using its works was bound to take all reasonable care to have its works in a safe condition: Parnaby v. Lancaster Canal
Co. Ad. & E. 223) and Mersey Docks
Trustees v. Gibbs (Q.R. 1 H.L. 93). The same principle is applicable to the respondent, and the latter cannot escape the performance of its duty by demanding a contract relieving it of its liability for negligence without some consideration other than the payment of the scheduled fare.
.......... 406
CHATTEL MORTGAGE.
CIVIL CODE.
Arts. 848, 855, 1208, 1211............ 321
See WILL 2.
CIVIL CODE- -Concluded
2.-Arts. 1265, 1801, 1762 to 1786... 205 See LIFE. 3.-Art. 2268................... See PRAcrICE CODE OF CIVIL PROCEDURE. Art. 50 .......................
2.-Arts. 94, 108 ...............
3.- Arts. 665, 668.................... CONCURRENT FINDINGS OF FACTS IN COURTS BELOW.
CONSPIRACY.
CONSTITUTIONAL LAW-Debt Adjustment Act, Alta., 1937, c. 9 (as amended)- Constitutional validity - Object, effect, pith and substance, of the legislation- Whether laws of general application-Repugnancy to Dominion legislation-Invasion of field of legislation reserved to the Dominion--B.N.A. Act, ss. 91, 92.]-The Debt Adjustment Act, 1987, Statutes of Alberta, 1937, c. 9 (as amended in 1937 (3rd session), c. 2; 1938, c. 27; 1938 (2nd session), c. 5; 1939, c. 81; and 1941, c. 42), is ultra vires in whole. Its effect is to take away from all creditors who are the owners of debts or liquidated demands that, apart from the Act, would be presently enforceable by law, their rights in respect of their enforceability by action or suit, and to substitute for such rights the chance of obtaining, by the arbitrary determination of a public authority, the Debt Adjustment Board (the appeal given therefrom is merely one from the arbitrary determination of one authority to the arbitrary determination of another), permission to enforce them. Such an enactment is something more than one relating to procedure; it strikes at the substance of the creditor's rights. The Act is repugnant to the provisions of Dominion statutes (instances mentioned) relating to matters within the exclusive jurisdiction of the Dominion Parliament, provisions creating or directly giving rise to or recognizing obligations in the nature of debts or liquidated demands.
To establish any such authority, with its powers of selection, involving a considerable power of regulation of classes of business and undertakings over which the B.N.A. Act gives to the Parliament of Canada exclusive control, is incompetent to the provincial legislature. The prohibitory provisions of the Act in question against proceedings by CONSTITUTIONAL LAW-Continued way of execution, etc., without the Board's permit, is ultra vires by reason of considerations of much the same character as those aforesaid. The Board is authorized to refuse a permit in any particular case.
The pith and substance of the legislation is to establish a provincial authority empowered to exercise a discriminatory control. While in form it is legislation in relation to remedy and procedure, yet, in attempting to regulate the remedial incidents of the right in manner aforesaid, it must, when read in light of its context in the Act, in substance be regarded as a step in a design to regulate the right itself. As to companies incorporated by the
Dominion, companies with objects other than provincial objects, in relation to the incorporation, status and powers of which companies the Dominion Parliament has, under s. of the B.NA. Act, exclusive power to legislate:-It is true that, where the business of the company is subject to provincial legislative regulation, the provincial legislature may legislate in such a manner as to affect the business of the company by laws of general application in relation to the kind of business in which the company engages in the province-but the enactments now in question, authorizing interference with the affairs of creditors in manner aforesaid, are not a general law in this sense. The matters dealt with by s. 26 of the Act are so related to the subject-matter of The Farmers' Creditors
Arrangement Act as to be withdrawn from provincial jurisdiction by force of the last paragraph of s. of the BN.A. Act.
Also the Act constitutes an attempt to invade the field reserved to the Dominion under Bankruptcy and Insolvency. Assuming that, by apt legislation strictly limited to enactments relating exclusively to matters within the legislative jurisdiction of a province, a Board might lawfully be constituted having some of the powers which the Debt Adjustment Board receives under the Act, yet,.in any view of that question, it is impossible in the Act to disentangle what a provincial legislature might competently enact from the principal enactments of the Act constituting the. Board with authority to exercise powers that the legislature is incompetent to confer upon it; and indeed, if this were possible and the Act could be re-written excluding what is ultra vires from what (on said assumption) might be intra vires, there can be no probability that the legislature would have enacted the Act in this truncated form.
The competent elements of the legislation, if such there be, not being severable from the incompetent enactments constituting the Board with the powers conferred upon it, the Act is, as a whole, ultra vires.
Crocket J. dissented, holding: The Act (as amended as aforesaid) is not ultra vires, in whole or in part, except in so far as its
CONSTITUTIONAL LAW-Continued provisions may be found to conflict with any existing Dominion legislation strictly. relating to any of the classes of subjects specially enumerated in s. of the B.N.A. Act or as being necessarily incidental to the particular subject-matter upon which the Parliament of Canada has undertaken to legislate as falling within one or other of the said enumerated heads. The whole purpose of the Act in question is to regulate and control the enforcement of contractual obligations for the payment of money so as to safeguard during a period of financial stress the interests of unfortunate resident debtors who, owing entirely to general depreciation of values through abnormal economic conditions, find themselves in such a position that the stringent enforcement of creditors' claims might entail irreparable loss upon them. Its provisions are predominantly directed to procedure in civil matters in provincial courts. The right to sue in provincial courts is a civil right in the province, whether the claim sought to be enforced arose in the province or not. The Act is one of general application in the province, within the meaning of the authorities.
None of its provisions are directed to insolvency legislation nor to banks or banking legislation, nor to the contracts of Dominion companies, carrying on business either within or without the province, though they may affect these subjects and these rights collaterally as a necessary incident to the attainment of the objects of the Act. While it was held in Attorney-General for Alberta and Winstanley v. Atlas Lumber Co. Ltd., [19411 S.C.R. 87, that s. 8 of the Act conflicted with certain Dominion legislation strictly and necessarily relating to head 18 of s. 91 of the B.N.A. Act (Bills of Exchange and Promissory Notes) and that the latter must prevail, it does not follow that the Act in question must be held to be wholly ultra vires merely because it affects or may affect Bankruptcy or Insolvency, Banks and Banking, Interest or any other subject enumerated in s. 91 upon which the Dominion Parliament has purported to legislate as falling within one or more of those classes of subjects. "Bills of Exchange and Promissory Notes" is the only class of contracts specifically mentioned in a. 91 of the B.N.A. Act, and this specific enumeration may well be said to expressly withdraw that class of contracts from the exclusive jurisdiction of the province in relation to s. 92 (13), "Property and Civil Rights in the Province." (Citizens' Insurance Co. v. Parsons, 7 App. Cas. 98; Attorney-General of Ontario v. Attorney- General for Canada, [18941 A.C. 189; Lodore v. Bennett, [1939] A.C. 468, and other cases, cited). VALIrry Acr, ......................
CONSTITUTIONAL LAW-Continued
2.-Section 16 of the Special War Revenue Act-Contracts of insurance with
British or foreign companies or foreign exchanges-Tax imposed on insured on premiums payable by him-Whether section 16 ultra vires-Special War Revenue
Act, 1982 (D.), c. 64, s. 1, and amendment,
1940-41 (D), c. 27, 8. 4-Canadian and
British Insurance Companies Act (D),
Geo. V, c. 47, as amended by (D), 1934,
24-25 Geo. V, c. 86.1-Section 16 of the
Special War Revenue Act enacted, in substance, that "every person resident in
Canada who, after the 31st day of December, 1931, insures or has insured his property situate in Canada * * * with any
British or foreign company, or with any
(foreign) exchange * * * which * * * is not authorized under the laws of the
Dominion of Canada to transact the business of insurance, shall * * * in each year pay to the Minister (of Finance)
* a tax of ten per centum of the premiums paid or payable by such person." Held that this section is ultra vires of the Parliament of Canada.. This section is, in point of law, so related to the insurance legislation affecting British and foreign companies and extra Canadian exchanges that, such insurance legislation being invalid, the section must fall with it. Assuming that the Dominion, in exercise of its control of trade and commerce under section (2) B.N.A. Act, may regulate the business of insurance carried on by British companies as a branch of external trade and commerce, this does not give the Dominion authority to regulate their strictly provincial business; and sections 116, 117 and 118 of the
Canadian and British Insurance Companies Act, if valid, do effect the regulation of such business. The principle of exclusive provincial control of the business of insurance within the province lies at the foundation of the judgment of the
Privy Council in re The Insurance Act of Canada [19421 A.C. 41.
The corresponding enactments in the Foreign Insurance Companies Act, being also legislation in relation to the business of insurance within the province, are not intra vires; and the case of extra Canadian exchanges is not distinguishable.
AS
..........................
3.-Taxation - Income tax - Provincial powers-Whether tax imposed on income or on person found in province-Income from sources outside province-Dividend
Tax Act, 1932, c. 5 (Alberta).1-The tax imposed by The Income Tax Act of Al- CONSTITUTIONAL LAW-Concluded berta, is not a tax on the income itself, but is a tax on the person receiving the income who is found within the province. Therefore, under the Act, the taxable income of such person includes also income derived from sources outside the province: per Rinfret and Hudson JJ. On its proper construction, The Income Tax Act of Alberta, 1932, imposes a tax on a person found in the province with respect to his income, including that derived from sources outside the province, and is intra vires the Alberta legislature: per Kerwin .and Taschereau JJ. and Gillanders, J. ad hoc. KER v. IN- .........................
4.-War Measures Act, 1914- Foreign Exchange Control Board-Orders in Council establishing Board with certain powers, prohibiting importation of property into Canada without licence and providing for fine or imprisonment on summary conviction or indictment-Whether ultra vires or inoperative-Status of complainant-Accused not entitled to exercise option as to mode of trial-Conspiracy-Whether illegal importation an indictable offence within s. 673 Cr. C.-War Measures Act, 1914, R.S.C., 1927, c. 206, sections 2, 3 (1) (2) 4-Interpretation Act, R.S.C., 1927. c.1 ..........................
5.-Bankruptcy-Ontario legislation as to preferences superseded by s. 64 of Bankruptcy Act .................... CONTRACT-Jurisdiction - Declinatory exception-Agreement with foreign company for sale of its goods in Canada- Business carried on in the province of Quebec with head-office located therein- Net commission on sales to be divided between foreign company and parties residing in the province-Action for accounting of such commissions taken by one party against foreign company-Whether provincial courts competent to hear the issue-Whether whole cause of action arise in the province-Article 94, 103 C.C.P.1- The appellant brought an action in the district of Montreal, province of Quebec, against the respondent, an incorporated body described in the writ of summons as having its head-office and principal place of business in the city of London, England, and also against the two other defendants, both residing in the city of Montreal. The action was instituted for an accounting of all commissions received directly or indirectly by or on behalf of the above-mentioned company in connection with orders for merchandise sent or on behalf of persons, firms or corporations in Canada or in the United States, CONTRACT-Continued in pursuance of an agreement herein described; in default of which the appellant asked that each defendant be condemned to pay him the sum of $225,000 as reliquat de compte. The respondent and the other defendants moved, by way of declinatory exception, that the action be dismissed on the ground that the Superior Court of the district of Montreal was not competent to hear the issue with regard to them. An agreement had originally been entered into between a certain partnership, carrying on business as wine and spirit merchants in the city of London, England, under the style of Trower and Sons, called "the
Firm"
and the appellant Ripstein and the defendant Gillespie, both of the city of Montreal. The Firm was to open, at their own expense, for the sale of their goods, an office in Montreal, called "Canadian office" and to appoint the defendant
Redpath as its manager, Gillespie and
Ripstein undertaking to use their best endeavours to introduce customers in Canada and the United States. The commission on all orders obtained by the Firm from these customers, whether obtained direct by the Firm or through Gillespie and Ripstein, were to be credited to the
Canadian office. The Firm was to send credit notes from the London office to the
Canadian office, showing the amount of commission to be allowed to the Canadian office, such commission being the difference between the cost price of the goods shipped by the Firm to Canada and the price at which such goods were invoiced to customers in Canada or the United States.
Payment was to be made by customers direct to the Firm's London office, and the
Firm was to remit to the Canadian office monthly the commission due to the latter on all sales in respect of which payment had been received. The "net commission"
of the Canadian office, after deduction of the expenses of carrying on the same, was to be divided, one-third each, between the
Firm, Gillespie and the appellant Ripstein.
Later on, the respondent company purchased the business of the Firm and undertook to carry on under the agreement. The respondent company's motion, by way of declinatory exception, was maintained and the action, as against the respondent, was dismissed by the Superior Court, whose judgment was affirmed by the appellate court. Held, reversing the judgment appealed from (Q.R. 69 K.B. 424), Davis and
Hudson JJ. (dissenting)
, that, under the circumstances of the case, all the essential facts, which together ought to give rise to the action brought by the appellant, i.e., the whole cause of his action, as constituted, had arisen in the city and district of Montreal, before the courts of which appellant was entitled to institute his action, under article 94 (3) C.C.P., and the declinatory exception should have been
CONTRACT-Continued dismissed.-The whole business covered by the agreement, whatever be its nature, was, in the intention of the parties, to be, and was, carried on in and from the Canadian office; and the appellant's action was for an accounting of the "net commission", i.e., for an accounting of the business carried on in and through the Canadian office, in the city and district of Montreal, where the seat of the business was located. Per Rinfret, Crocket and Taschereau JJ.-The provisions of article 94 C.C.P. are broad enough to include within their ambit any defendant, be he a foreigner, a stranger or not; and it was the evident intention of the legislature of Quebec, as expressed in that article, to grant to the Quebec courts jurisdiction over aliens or parties outside the province, if the whole cause of action arose therein. Per Rinfret, Crocket and Taschereau JJ.-No opinion is expressed as to whether the agreement should be styled a partnership, or an agency agreement, or a contract of lease and hire of service, nor as to whether the declinatory exception was also wrong on any of the other grounds raised by it and decided by the judgments appealed from. Per Davis J. (dissenting)-The making or assuming of the contract by the respondent company in the city of London, England, the receipt of payments by that company there from Canadian and American sales, the failure of the company "to remit" from London to Montreal certain commissions on these sales, and probably other facts necessary to establish the alleged cause of action, did not arise within the jurisdiction of the Quebec court. Per Hudson J. (dissenting)-The agreement itself was made in London, England, the moneys were collected by the defendants there and not in Canada, contracts were made with a number of distillers and liquor dealers in London and in New York and moreover the appellant asked for an accounting in respect of all transactions had and done, whether in Canada, in the United States or in England, and, therefore, it cannot be said that the whole cause of action arose within the district of Montreal.
v. & ............................
2.-Agreement to purchase land from tax sale purchaser-Stipulation that the agreement be void if the land be redeemed from tax sale-Redemption by party to the agreement - Question as to latter's right to avail himself of said stipulation under circumstances of the case and on construction of the agreement.]-Appellant held a mortgage on farm land, on which there was a prior charge for an annuity to M., which became about $6,000 in arrears. There was also default on the mortgage and on taxes. The land was sold CONTRACT-Concluded to respondent at a tax sale for $1,299.10.
Appellant and M. had each a statutory right to redeem the land from the tax sale within one year. If appellant redeemed, that would leave M.'s claim in priority.
Appellant agreed with respondent to buy the land from her for $3,000, paying $200 deposit, and to pay the balance on his getting title. Clause 7 of the agreement stipulated that, in the event of the land being redeemed from the tax sale, the agreement should have no effect and respondent would repay the $200. Later M.
threatened to redeem; so appellant obtained for $3,000 a release of M.'s interest;
and then redeemed. He sued respondent for repayment of said $200. Respondent denied liability and counter-claimed for the balance payable under said agreement
(after giving credit for sums received as deposit and on redemption). Held (Kerwin J. dissenting), affirming judgment of the Court of Appeal for Ontario ([19401
O.R. 489): Appellant's action should be dismissed and respondent's counter-claim allowed. Appellant could not by his own act bring about the event of redemption and claim the advantage thereof under said stipulation in his agreement with respondent, the agreement not specifically giving him such a right. Per Kerwin J..
dissenting: Appellant's object in entering into his agreement with respondent was to protect himself so far as possible from further loss in case M. did not redeem.
The recitals therein showed that both appellant and respondent were aware that the land could be redeemed; and that the agreement to sell and purchase was subject to that right in whomsoever it might rest. Said clause 7 of the agreement provided for the event of the land being redeemed and had the same effect as if it were agreed that either party could, upon notice, determine the contract. Commis- 3.-Crown-Construction of wharf-Furnishing and driving steel piles into soil- Work completed-Petition of right-Claim by contractor for damages and additional compensation-Soil alleged to be of a different nature than indicated in plans and specifications-Unforeseen difficulties
- Quantum meruit - Implied contract - Contract to be considered as law of parties-Statutory law-Exclusive jurisdiction of the Exchequer Court of Canada in matter of claims arising out of contract entered by the Crown-Additional compensation not allowed under section 48 of the Exchequer Court Act.............
COURTS, JURISDICTION OF.
CRIMINAL LAW Appeal-Jurisdiction -Whether dissenting judgments in a court of appeal disclosed a dissent on a question of law within the meaning of section 1023 of the Criminal Code.]-The respondent, a divisional registrar appointed under regulations, enacted by order in council under powers conferred by a Dominion Act of 1940, concerning National War Services, was found guilty and convicted on two charges of having committed offences in contravention of some provisions of these regulations. On an appeal by the respondent, the appellate court, by a majority of three to two, quashed the verdict and the conviction.
The judgment of the majority of the Court declared the verdict to be unreasonable for reasons rezsulting from inter alia an examination of the relative values of the testimony adduced by the Crown and the testimony given by the accused. The judgment did not rest upon any view of the majority upon a question which was a question of law alone. The judgment of one of the dissenting judges was simply to the effect that he was "of the opinion that the appeal should be dismissed", while the other dissenting judge held that there should be a new trial, without stating, either expressly or by implication, that such conclusion was based upon an opinion that the majority proceeded upon any error in point of law alone. On the appeal to this Court by the Attorney- General for Quebec, the respondent moved to quash such appeal. Held that no jurisdiction lies in this Court to entertain the appeal: neither of the judgments of the two dissenting judges of the appellate court discloses a dissent on a question of law within the meaning of section 1023 of the Criminal Code.
DiCARY ..................
2.-Automatic slot machine Amusement only provided-Results determined by skill of operator-No element of chance or mixed elements of chance and skill-Whether service-vending machine- Common gaming house-Criminal Code, R.S.C., 1927, c. 36, sections 226, 229 and section 986, par. 4, as amended by 2 Geo. VI, 1988, c. 44, s. 46.1-The appellant had in his premises an automatic slot-machine for the amusement of the public known under the name of "Evans Ten-Strike Miniature Bowling". Section 986 (4) of the Criminal Code enacts that, "if any house, room or place is found fitted or provided with * * * any automatic or slot machine used or intended to be used for any purpose other than for vending merchandise or services, * * * there shall be an irrebuttable presumption that such house, room or place a common gaming house". The appellant was convicted having kept a common gaming house, and CRIMINAL LAW-Continued the appellate court affirmed the conviction, holding that, under that section, all slot machines, including those vending amusement, were illegal. Held, reversing the judgment appealed from (Q.R. [19421
1 K3. that the machine found in the appellant's premises was providing a harmless amusement to the operator and that, for the purpose of determining this appeal, the word "services" should be construed as including "amusement." If a narrower interpretation of the word "services" was given, it would then be a criminal act, for instance, to keep in a hotel a musicrecording slot machine, and this is not the letter nor the spirit of the law. Therefore, the conviction of the appellant should be quashed. Rex v. Levine ((1939)
72 Can.
Cr. Cas. 312) followed. Roberts v. The
King ([19311 S.C.R. 417), Rex v. Perlick
((1939)
72 Can. Cr. Cas. 365), Rex v.
Granda ((1941)
74 Can. Cr. Cas. 344),
Rex v. Collins ((1939) Can. Cr. Cas.
272) discussed. v. THE 84
3.-Agreement or arrangement "to unduly prevent or lessen competition"-Cr.
Code, s. 498 (1) (d)-What must be shown to establish the offence-"Unduly"-Intent
-Evidence-Admissibility of written opinions of counsel given before the making of proposed agreements.] -This
Court dismissed appeals from the affirmance, by the Court of Appeal for Ontario (Henderson J.A. dissenting on certain questions of law) ([19411 3 D.L.R. 145), of appellants' convictions on the charge, laid under s. 498 (1) (d) of the Criminal Code, that they did unlawfully conspire, combine, agree or arrange together and with one another, and with ten other named companies or individuals not indicted, to unduly prevent or lessen competition in the production, manufacture, purchase, barter, sale, transportation or supply in certain named places and other places throughout
Canada, of corrugated and solid fibreboard boxes or shipping containers. Per the Chief Justice: S. 498 (1) (d) is aimed at protecting the specific public interest in free competition (Stinson-Reeb v. The
King, [19291 S.C.R. 276; Weidman v.
Shragge, 46 Can. S.C.R. 1). The lessening or prevention agreed upon will be "undue"
within the meaning of the enactment if, when carried into effect, it will prejudice the public interest in free competition to a degree that the tribunal of fact finds to be undue, and an agreement to prevent or lessen competition to such an extent is, accordingly, an offence under the enactment. In the present case, the aim of the parties to the agreement was to secure effective control of the market in Canada;
and this fact affords in point of law a sufficient basis for a finding that the agreement was one which, if carried into effect, would gravely prejudice the public interest
CRIMINAL LAW-Continued in free competition, and for a conviction under s. 498 (1) (d). Per Rinfret, Kerwin, Hudson and Taschereau JJ.: If it is shown that the accused entered into an agreement or arrangement, the effect of which would be unduly to prevent or lessen competition, it need not also be shown, in order to establish an offence under said enactment, that the agreement or arrangement must have been intended by the accused to have that effect. Mens rea is necessary, but that requirement was met when it was shown that appellants intended to enter and did enter into the very arrangement found to exist. As to the word "unduly" in the requirement to constitute the offence: The public is entitled to the benefit of free competition (except in so far as it may be interfered with by valid legislation), and any party to an arrangement, the direct object of which is to impose improper, inordinate, excessive or oppressive restrictions upon that competition is guilty of an offence (Stinson- Reeb v. The Kina. [19291 S.C.R. 276). Once an agreement is arrived at, whether anything be done to carry it out or not, the matter must be looked at in each case as a question of fact to be determined by the tribunal of fact upon a common sense view as to the direct object of the arrangement complained of. The evidence in these cases of what was done is merely better evidence of that object than would exist where no act in furtherance of the common design had been committed. Per curiam: Letters giving opinions of counsel to appellants or some of them prior to the execution of original agreements in question, which opinions, it was suggested, would indicate that the matter was placed before counsel who advised that, on the information before them, it would not be contrary to law for appellants, or some of them, to enter into the agreements, were properly rejected as evidence at the trial, because, even if the letters contained what was suggested, they could have no bearing upon the point of substance to be determined.
et al. v. TE
4.-Constitutional law-War Measures Act, 1914 - Foreign Exchange Control Board - Orders in Council establishing Board with certain powers, prohibiting importation of property into Canada without licence and providing for fine or imprisonment on summary conviction or indictment-Whether ultra vires or inoperative-Status of complainant-Accused not entitled to exercise option as to mode of trial-Conspiracy-Whether illegal importation an indictable offence within s. 578 Cr. C.-War Measures Act, 1914, R.S.C., 1927, c. 206, sections 2, 8 (1) (2) 4-Interpretation Act, R.S.C., 1927, c. 1.1-The appellant was convicted of having import- ES.C.R. CRIMINAL LAW-Continued ed Dominion of Canada bonds from the
United States of America into Canada without having obtained from the Foreign
Exchange Control Board a licence so to do and of having conspired with others so to import. The conviction was affirmed by the appellate court, St. Germain J. dissenting.-The Governor in Council, by ss. 1 of s. 3 of the War Measures Act, 1914, was authorized to make orders and regulations for the security, etc., of Canada, which were declared by ss. 2 to have the force of law. By s. 4, the Governor in
Council may prescribe penalties, in case of violation of these orders and regulations, which may be imposed upon summary conviction or upon indictment. In
September, 1939, an Order in Council
(P.C. 2716) established the Foreign Exchange Control Board with certain powers.
Subs. I of par. 22 prohibited importation of goods, etc., into Canada except under a licence granted by the Board and subs.
I of par. 40 prescribed that any person guilty of an offence under the order would be liable on summary conviction to fine or imprisonment, or both. By an Order in
Council (P.C. 3799) issued in November,
1939, the words "or on indictment" were added after the words "summary conviction". Held that the appeal should be dismissed and the conviction of the appellant affirmed. The contention of the appellant, that the whole of the Order in Council
(P.C. 2716) was ultra vires because it gave power to the Board to pass regulations that only the Governor in Council was authorized to promulgate under the provisions of the War Measures Act, must fail. The Board had not passed any regulations affecting the appellant with respect to the charges against him; what the appellant did was in contravention of ss. 1 of par. 22 of the Order, which had the same force as if it had been enacted by
Parliament itself. The provisions of the
Orders in Council permitting prosecutions to be either on summary conviction or on indictment are not inoperative. Section 4 of the Act permits the Governor in Council to prosecute by one or the other method of procedure: no objection was found with paragraph 40 as it originally stood and nothing in the Act prohibits the Governor in Council to act as he did by the amending Order in Council. There is nothing in the Order in Council requiring a prosecution to be commenced by any particular official or individual, or that the latter required a special authorization from the
Board. In any event, evidence disclosed that the complainant in this case had authority in fact. Moreover, the contention that an accused is the only one entitled to exercise the option as to the mode of trial cannot prevail. Section 573 of the Criminal Code provides that "every one is guilty of an indictable offence
CRIMINAL LAW-Continued
* * * who * * * conspires with any person to commit any indictable offence." The contention of the appellant that, because par. 40 of the order states that every person guilty of an offence shall be liable "on summary conviction or on indictment" the offence of importing is not an indictable dffence, is unsound. The words "indictable offence" in s. 573 Cr. C. merely mean an offence, as to which conspiracy is charged, which may be prosecuted by indictment. That requirement is met by the terms of par. 40, even in cases where proceedings had been commenced under the summary conviction provisions of the Code. v. ...... 5.-Murder-Shooting during attempted robbery-Four accused engaged in the robbery-Victim shot by one of the four- Struggle between the latter and the victim -Jury instructed that accused guilty of murder or nothing-Whether verdict of manslaughter should have been left open to jury-Definition of murder-Ss. 252 (2), 259 (d) and 260 Cr. C.1-The respondent H., with two companions, entered a shop kept by the father of the victim for the purpose of robbery. The family of the victim and the victim were sitting in a room, in the rear of the shop, separated by a half door with curtains. The mother, hearing the store bell, entered the shop, saw H. carrying a revolver and gave a warning to the family that a hold up was in progress. H. fired a first shot through the wooden partition of the side of the doorway and a second one through the curtains. The first of the shots wounded the victim in the hand and the second in the arm. The victim immediately came into the shop and grappled with H. in an effort to disarm him. The accounts of the actual shooting by the mother and a brother of the victim did not agree. The mother testified that, during the struggle, the victim was attempting to take the pistol from H. "but could not reach because he was quite high" and that she heard then only one shot, her son falling down; while the brother stated that H. broke away from the victim, was leaving the shop and, just as he was opening the door, turned and fired at the victim a third shot which killed him; but the brother agreed with his mother that the victim "had H.'s wrist raising it up in the air" during the struggle. A witness for the Crown testified that H., on the evening of the date of the crime had made a statement to him "that the gun accidentally went off". The trial judge charged the jury that H. was guilty of murder or of nothing. All four respondents were convicted of murder, H. for having effected the act of shooting and the three others as conspirators with H. and, as such, responsible for the crime. A majority of the CRIMINAL LAW-Concluded
Court of Appeal ordered a new trial, holding that the trial judge erred in not instructing the jury that they could have returned a verdict of manslaughter, if they believed some of the evidence that the revolver was accidentally discharged. Held that the judgment appealed from (78 Can.
Cr. C. 1) should be affirmed. The trial judge properly instructed the jury that it was their duty to find H. guilty of murder, if they accepted the evidence of the brother of the victim; and that they could render a similar verdict, if they accepted the mother's testimony, as they could properly infer that the shot which occurred during the struggle, following at once the two shots fired into the sitting room, was intentionally fired by him in a state of mind evincing disregard of the consequences of his shooting and with the knowledge that his conduct was endangering the lives of the people whose premises he was invading. But the trial judge did not deal with the third hypothesis, the possibility that they might find the pistol was discharged by accident in the sense that it was not discharged by any act of H. done with the intention of discharging it. The trial judge ought to have told the jury that they might and ought to find a verdict of manslaughter if they thought the pistol was not discharged by the voluntary act of H. and that H. did not anticipate and ought not to have anticipated that his conduct might bring about a struggle in which somebody's death might be caused.-Also the trial judge proceeded rightly in instructing the jury that, in the circumstances of the case, the law to be applied was to be found in the Criminal
Code (S. 252 (2) Cr. C.) Graves v. The
King (47 Can. S.C.R. 568) applied. THE
KING v. HUGHs et al............. 517
CROWN - Contract - Construction wharf-Furnishing and driving steel piles into soil-Work completed-Petition of right-Claim by contractor for damages and additional compensation-Soil alleged to be of a different nature than indicated in plans and specifications - Unforeseen difficulties- Quantum meruit
Implied contract-Contract to be considered as law of parties-Statutory law-Exclusive jurisdiction of the Exchequer Court of
Canada in matter of claims arising out of contract entered by the Crown-Additional compensation not allowed under section 48 of the Exchequer Court Act.]- In 1936, the Minister of Public Works, acting on behalf of His Majesty the King in right of the Dominion of Canada, asked for tenders for the construction of a wharf at Rimouski, in the province of Quebec.
Plans and specifications, prepared by the engineers of the Department of Public
Works, were furnished to the tenderers;
and a specific clause therein provided that
CROWN-Continued the contractor would "be required to sign a contract similar to the form exhibited at the same time as the plans ond specifications." The respondent's tender for $365,750.18, being the lowest, was accepted by Order in Council passed on the 10th of February, 1937; and, on the 23rd day following, a contract was entered between the Crown and the respondent embodying the terms and conditions under which tha works would be performed. major item of the contract was the fut nishing and driving into the soil of number of steel piles of interlocking typ The respondent performed the entire wor In May, 1938, the respondent claimed I petition of right from the appellant further sum of $160,000 for damages an< additional compensation. The claim was based on the ground that the unit price tendered by the respondent would have been sufficient to cover the work, leaving a reasonable profit, if the soil into which the piles had to be driven had been as described in the plans and specifications, which were declared to be part of the contract; but the respondent alleged that it encountered a certain material called "hard pan" and many large boulders therein embedded, thus necessitating extra work and putting the respondent to very large additional expenses. The respondent's claim was, as alleged, for compensation for work not foreseen in the agreement and performed "hors du contrat," under an implied contract, i.e., for works accepted by the Crown for which no compensation has been paid, on a "quantum meruit" basis. The Exchequer Court of Canada maintained the respondent's petition of right, holding that the latter was entitled to a sum of $119,597.22; but deducted one-third of that amount owing to loss of time, delay and incompetence attributable to the respondent. Both parties appealed to this Court, the Crown to have the claim dismissed and the respondent to have the amount awarded in the Court below increased. Held, reversing the judgment of the Exchequer Court of Canada, that, in view of the terms of the contract, which is the law of the parties and by which this Court is bound, the respondent's petition of right should be dismissed. The respondent tendered to furnish and drive the piles in a soil the nature of which it agreed to investigate, and which the appellant did not guarantee, but merely indicated with some reserves as being of a certain kind or nature. The works to be performed by the respondent were fully covered by the contract and the obligation of the respondent was not to drive piles in a specified soil, but in a specified place. The risk was upon the respondent, and having assumed it, it must necessarily bear all the consequences, financial and others, if it mis- CROWN-Continued judged the works to be performed and miscalculated the cost of the enterprise.
Expenses incurred for unforeseen difficulties must be considered as being included in the amount of the tender, and the respondent had the legal obligation to execute the contract for the price agreed upon, in the same way as would have been its undisputable right to benefit, if the soil had been more favourable and easier than foreseen. Held, further, that
.the contentions of the Crown could also be upheld upon statutory law: the Exchequer Court of Canada, under section
38 of the Exchequer Court Act, has exclu- 'eive original jurisdiction in all cases in a which the claim arises out of a contract r entered into by or on behalf of the
Crown; and section 48 of that Act limits the jurisdiction of that Court and does not allow it to grant any additional compensation. Held, further, that, assuming that the claim of the respondent was not covered by the contract, it would still fail; for then it would have to be founded on an implied contract; and the agreement itself contains a clear declaration of the parties that "no implied contract of any kind whatsoever, by or on behalf of His Majesty, shall arise or be implied from anything in this contract contained."
Decision of the Judicial Committee of the
Privy Council in The King v. Vancouver
Lumber Co. (50 D.L.R. 6) has no application to this case, inasmuch as a form of contract, similar to the one subsequently signed by the respondent, had been annexed to the plans and specifications.
THE PARADIs & INc.. 10
2.-War loan bond-Transfer by owner
-Made in form approved by Minister of
Finance - Signature of registered owner guaranteed by bank-Owner denying having executed transfer-Liability of the
Crown.1-Transfer of war loan bonds of the Dominion of Canada had been made on a form required by regulations passed by Order in Council under the provisions of section of c. 178, R.S.C., 1927. At the foot of such form, it was specified that the "signature of the registered owner, if not known at the office of transfer, must be guaranteed by a bank * * * ".
Held that the liability of the Crown can only be discharged by evidence that the registered owner of the bond has, in fact, duly executed a written instrument of transfer on a form approved by the Minister of Finance.-The mere reception by the Crown, of such form purporting to be signed by the owner and containing the warranty of a bank as to the signature of the registered owner, is not sufficient in itself to liberate the Crown from the payment of the bond. v.
CROWN-Concluded
3.- Revenue - Sales. and Excise taxes. ................................... DAM-Raising level of-Flooding of lands - Demolition of dam - Damages - Jurisdiction of Superior Court to entertain claims-Whether Superior Court or Public Service Commission have exclusive jurisdiction as to question of damages-Watercourses Act, R.S.Q., 1925, c. 46, section 12, as amended by 18 Geo. V. (1928), c. 29. ......... DEBTOR AND CREDITOR - Farmers' Creditors Arrangement Act. (Dom.), 1984 -Jurisdiction of Board of Review to entertain proposal-Grounds against proposal raised by way of certiorari- Creditor's debt reduced to amount below value of security-Present and prospective capability of debtor to perform obligations prescribed-Prospective value of farm upon which creditor has security-Whether proposal formulated in fairness and justice to debtor and creditor-Farmers' Creditors Arrangement Act, 1934, (Dom.) ss. 5, 7, 12 (7) (8) (9) (10) .1-The applicant Cheese farmed a certain land which was subject to a first mortgage held by the Corporation appellant. He made a proposal to his creditors for a composition, extension of time or scheme of arrangement under the Farmers' Creditors Arrangement Act, 1934, and amendments. The proposal not having been approved by the creditors before the Official Receiver, a request was made by the debtor to the Board of Review to formulate an acceptable proposal under the Act. Of all the claims against the debtor set out in the proposal, the Board dealt only with the claim of the Corporation appellant for an amount of $689.25, no proposal having been asked of the Board as to some of them and the others having been paid. The Board of Review found that the debtor was entitled to the benefit of the Act, formulated a proposal and subsequently confirmed it. Under the proposal, the Corporation appellant's claim was reduced to $400 payable in ten equal consecutive annual instalments with interest at six per cent. The appellant applied to the Court of Appeal for Saskatchewan for an order that a writ of certiorari be issued out of that Court for the return of the proposal and that the proposal and its confirmation be quashed as having been made without jurisdiction. The grounds raised in the Court of Appeal and before this Court were that (a) the proposal deprived the appellant of its security in that the appellant's claim was reduced to a figure below the value of its security, (b) that the proposal was based on considerations other DEBTOR AND CREDITOR-Continued than the present and prospective capability of the debtor to perform the obligations prescribed and the prospective values of the farm upon which the appellant had security and (c) the proposal was not formulated in fairness and justice to the creditors.
Other grounds were raised by the appellant for the first time before this Court, but it was held that they ought not to be given effect to. The appellant's application was dismissed by a majority of the appellate court. Held, affirming the judgment appealed from
([19411 1 W.W.R. 337), that the Board of
Review had jurisdiction to entertain the application of the debtor and to formulate and confirm the proposal in this case; and that such proposal ought not to be quashed on the grounds raised by the appellant.
Per the Chief Justice.-The jurisdiction of the Board of Review is incontestable to entertain the debtor's application to formulate and to confirm an acceptable proposal. This Court cannot give effect to the points of law or contentions raised by the appellant without holding that the impeached proposal and confirmation of it constitute an erroneous adjudication upon matters that were within the jurisdiction of the Board of Review; and it would be inadmissible to quash the proposal upon that ground.-All questions touching the present and prospective capability of the debtor to perform his obligations and touching the productive value of the farm, to which subsection 8 of section relates, are obviously matters to be determined by the Board; and the Board's decision upon such matters is not subject to review in any court, unless (and no opinion is expressed on this point) it is reviewable by the court of bankruptcy established by section 5.-Also, the explicit words of subsection 9 of s. 12 leave the matter of fairness and justice to the
Board for determination.-As to the specific point raised by the appellant that the effect of the proposal was to reduce the mortgage debt below the value of the security, which, it is alleged, would be ultra vires of the Board: it canont be affirmed as a proposition of law, on the material before the Court, that such is the effect of the proposal. The Board may have proceeded upon the view that, in point of fact, the sum to which the mortgage debt was reduced was not less than the value of the farm, and it is not competent to this Coulrt to review the proposal or its confirmation on the ground that it involves an erroneous adjudication upon a matter of fact.-No opinion is expressed on the question whether either the Court of Appeal for Saskatchewan or this Court has any jurisdiction to grant certiorari on the grounds upon which the present appeal is based.
Per Rinfret,
Crocket and Taschereau JJ.-It is not
DEBTOR AND CREDITOR-Concluded necessary, for the purpose of this appeal, to decide the point, either in its legal aspect or from the viewpoint of jurisdiction conferred upon a Board of Review by the Act, whether a Board has jurisdiction to reduce the claim of a secured creditor at a sum less than the value of its security.-The Court, in this case, is not in a position to find whether, as a matter of fact, the proposal has the effect of making such reduction, and there is nothing which enables the Court to say that the value of the respondent's farm is greater or less than $400.
The fact itself whether the appellant's debt was so reduced must have been part of the inquiry of the Board; and, at all events, that inquiry was committed by the Act to the Board, the only tribunal competent to determine that fact, and such inquiry cannot be questioned on certiorari. -As to the ground that the proposal was not formulated in fairness and justice to the creditors, such a question does not affect the competency and jurisdiction of the Board of Review nor challenge the authority of the Board to formulate a proposal: such an issue raises questions of pure fact and cannot be made the subject of an inquiry by a superior court through the procedure of certiorari.-If the Board should fail to act "in fairness and justice" to the debtor and creditors, the controlling authority on a question of that kind would be the county or district court acting under section 5 of the Act. Per Hudson J.-In formulating and confirming a proposal as to a secured debt, it is within the jurisdiction of the Board of Review under the Act to reduce the debt to an amount below the value of the security.-As to the question of fairness and justice to debtor and creditors, this Court is not in possession of all the information possessed by the members of the Board and, in the absence of a much more complete statement of facts, it cannot be held that the Board has been unfair to the Corporation appellant in reducing its mortgage, according to statements made during argument, by a sum of only about $42.25. In any event, such a question has been rightly held by the appellate court not to be open to the DEBT
ADJUSTMENT
ACT, ALTA., DECLINATORY EXCEPTION. DEPENDENTS' RELIEF ACT, R.S.S., 1940, C. 111. See WILL 3 ........ ELECTION LAW-Dominion Controverted Elections Act-Petition to annul election - Corrupt practices - Knowledge candidate or official agent-"Agent" in s. 49 including unofficial agent-Distribution of liquor and money-Presumption of corrupt practices-Definite mandate by candidate not necessary to constitute an
"agent"-Political organization in charge of election-Accredited members and persons employed by it deemed to be
"agent s"-Exoneration clause in s. 54- Burden of proof-Dominion Controverted
Elections Act, R.S.C., 1927, c. 50, ss. 49,
54, 76.1-The respondent was, on March
27th, 1940, declared elected member of the House of Commons for the county of
Stanstead. On April 20th, 1940, a petition was presented under the provisions of the
Dominion Controverted Elections Act to have the respondent's election annulled on the grounds that he, personally and through his agents, had committed corrupt and illegal practices, consisting particularly in the distribution of whisky and money.
The organization of the campaign on behalf of the respondent was entirely left in the hands of the Liberal Organization of the county, the joint-presidents being one Wilkinson and one Jubinville. The latter exercising his activities as chief organizer in the town of Coaticook, received from the former a sum of $1,200 which in part served to purchase whisky afterward deposited at the hotel of one
Maurice in Coaticook, and the balance was distributed to local organizers in the surrounding municipalities who were not asked to give any account of their disbursements.
Moreover, Maurice bought an additional quantity of whisky, saw personally to its distribution and on the day of the election treated a number of electors whether they had voted or not.
Many other persons also treated electors within the limits of the places where they were organizing and working on behalf of the respondent. Some whisky was also served to voters in the street, in private houses, in automobiles and inside some industrial premises. On a smaller scale, some voters received money for their votes and some others were the recipient of unexpected gifts, which were termed as having been made for "charitable purposes". The trial judges dismissed the petition and the appellant appealed to this Court. Held that all the acts established in this case amount to corrupt practices and that they are sufficient to void the election, although the respondent himself and his official agent have not been parties to those practices. When section
49 of the Dominion Controverted Elections Act enacts that "any corrupt practice * * committed by a candidate
* * or by his agent" renders the election void, the word "agent" does not mean only the "official agent", but in- ELECTION LAW-Concluded cludes any unofficial agent. The distribution of moneys to local organizers who were not asked to give any account of their disbursements creates a presumption and allows a court to draw the inference that it was intended for the corruption of the electors. Belleau v. Dussault (L6vis case, 1885, Can. S.R. 133) and Gallery v. Darlington (St. Ann's case, 1906, 37 Can. S.C.R. 563) followed. Even if there was evidence that an elector had treated another elector or had given him money to induce him to vote for a candidate, the election should not be voided unless the so-called agent is linked in some way to the candidate himself; but it is not necessary that there should be a definite mandate by a candidate to one of his supporters in order that the latter be termed an agent within the meaning of the Dominion Controverted Elections Act, Brassard v. Langevin (Charlevoix case, 1877, 1 Can. S.C.R. 145) cited. When a candidate and his official agent rely upon a political organization to promote the campaign and bring the election to a successful conclusion, the accredited members of the association should be held to be the agents of the candidate, and all those employed by the association are, within the limits of their duties, in the same sense the agents of the candidate himself. A candidate, in order to be relieved from the consequences of corrupt practices by the operation of section 54 of the Dominion Controverted Elections Act (exonerating clause), must bring himself strictly within all its terms; and the respondent in this case has failed to show that he should be allowed to take advantage of that section. Although it has been established that he and his official agent have committed no reprehensible acts, it is not in evidence (and the burden of proof was upon the respondent) that the corrupt practices were committed contrary to the order of the candidate or his official agent, and nothing in the record can lead the court to the conclusion that they have taken all reasonable means for preventing the commission of corrupt practices. Judgment of the trial judges reversed., petition maintained and election of the respondent annulled. v. DAvIDsoN..... 306 2.-Judgment of Supreme Court of Canada annulling election of member for House of Commons-Report made to Speaker by Registrar- Motion subsequently made for stay of proceedings- Ruling also as to costs-Dominion Controverted Elections Act, R.S.C., 1927, c. 50, ss. 68, 69, 70, 75.................... ESTATES-Administration of.
Wna
3...................
EVIDENCE-Criminal law-Agreement or arrangement "to unduly prevent or lessen competition"--Cr. Code, 8. 498 (1) (d)- What must be shown to establish the offence-"Unduly"-Intent-Admissibility of written opinions of counsel given before the making of proposed agreements ............................
2.-Burden of proof-Law of Nova
Scotia-R.S.N.S., C147, s.18...
EXCHEQUER COURT OF CANADA- Exclusive jurisdiction of, in matter of claims arising out of contract entered by the Crown-Additional compensation not allowed under section 48 of the Exchequer
Court Act ..........................
See CRowN 1.
FARMERS'
CREDITORS
ARRANGE- MENT ACT, 1934 (DOM.).
FOREIGN COMPANY-Agreement with, for sale of its goods in Canada-Jurisdiction-Declinatory exception-Action for accounting of commissions on sales.. 107
FOREIGN EXCHANGE
CONTROL
BOARD.
See 4............
GIFTS INTER VIVOS-Question as to succession duties payable on same.. 202
HARBOUR-Vessel damaged by striking obstruction in-Duty and extent of Board of Commissioners in assuring safety of harbour under its jurisdiction...... 450
HUSBAND AND WIFE-Suit for annulment of marriage-Alleged incapacity of wife owing to mental condition creating invincible aversion to act of consummation.1-The mere refusal by a wife of marital intercourse due to her caprice is not a sufficient ground to warrant a decree of nullity of marriage; there must be an incapacity of some kind, which in some cases is a structural defect, but in some cases may arise out of a mental condition creating an invincible aversion to the physical act of consummation.
Such a mental condition may be inferred from the proven facts, and justifies a decree for annulment of marriage. G. v. G., [1924]
A.C. 349; Napier v. Napier, L.R. [1915]
P. 184, at 193, and other cases, referred to.
In the present case it was held, reversing
HUSBAND
AND WIFE-Concluded the judgment of the Court of Appeal for Ontario ([1939]
O.W.N. 524; [19391 4 D.L.R. 402), that the drawing of such an inference and judgment for annulment by the trial judge, was right. (Davis J. dissented, holding that, on the evidence, the husband had not made a case for a decree of nullity. v.
2.-Insurance (life)-Insurance contract or policy-Change of beneficiary-Loan and surrender cash values-Cash advances by insurance company upon sole security of policy-Insured appointing his wife as beneficiary - Wife asking and receiving cash advances-Whether a "loan"-Wife endorsing company's cheque in favour of husband and proceeds deposited in his bank account-Prohibition for the consorts to confer benefits inter vivos upon each other-Obligation by the wife with or for her husband-Whether transaction in conformity with Husbands' and Parents' Life Insurance Act, R.S.Q., 1925, c. 244- Articles 1265, 1801, 1762 to 1786 C.C. 205 See LiFu.
IMPROBATION.
See W 2...................... INCOME TAX-Assets and undertaking of company taken over by another company in 1987-Undistributed income of first mentioned company, earned prior to 1985, on hand at the time-Shareholder thereof receiving for her shares cash and shares in the other company-Shareholder assessed for income tax for year 1987 for a sum as being her proportion of said undistributed income-Right to so assess- S. 19 (1) of Income War Tax Act (Dom.), as enacted by s. of c. 88, 1986-"Winding up, discontinuance or reorganization" of business of company-"Distribution in any form of the property of the company" -Effect of s. 22 of said Act of 1986, enacting that said s. (and other sections) of that Act "shall be applicable to the income of the year 1985 and fiscal periods ending therein and of all subsequent periods"-Question as to what is referred to (as applicable to said s. 11) by "income" in said s. 22.1-The assets and undertaking of S. Co. as a going concern were acquired, and its liabilities assumed, by P. Co. under an agreement between said companies which was made and became effective in 1937.
S. Co. had on hand undistributed income, all earned prior to 1935. Respondent, a shareholder of S. Co., received for her shares, in 1937, pursuant to the agreement and the consideration therein provided, a sum in cash and shares in P. Co. She was assessed for income tax for the year 1937, under the Dominion Income War Tax Act, for an amount which included a sum as being her proportion of said undistributed in- IN
INCOME TAX-Concluded come. She disputed the right so to assess her. By s. of c. 38, 1936, s. (1) of said Income War Tax Act was enacted as follow: "On the winding-up, discontinuance or reorganization of the business of any incorporated company, the distribution in any form of the property of the company shall be deemed to be the payment of a dividend to the extent that the company has on hand undistributed income."
S. 22 of said c. 38, 1936, enacted that certain sections, including said of said c. 38, "shall be applicable to the income of the year and fiscal periods ending therein and of all subsequent periods." Held: There was a "windingup, discontinuance or reorganization of the busines," and a "distribution of the property," of S. Co., within the meaning of said s. (1); and further (reversing the judgment of Maclean J., [1941] Ex. C.R.
175; Masten J. (ad hoc) dissenting), the
"income" mentioned in said s. 22 of c. 38,
1936, refers (as applicable to said s. of c. 38, 1936) to the income of the taxpayer, and not to the "undistributed income" of the company in said s. (1);
and respondent was assessable for her proportionate part of said undistributed income of S. Co. (S. (2) (as enacted by s. of c. 38, 1936) and other provisions of the Income War Tax Act also referred to; and the history of the legislation relevant to the question in dispute, discussed).
MER- 2.--Constitutional law - Taxation - Provincial powers-Whether tax imposed on income or on person-Income from sources outside province - Dividend
Tax Act, 1982, c. 5 (Alberta)...... 435
3.-(Provincial)-Extra-provincial company manufacturing goods-Distribution of same goods by provincial company- Whether profits from such sales income of extra-provincial company "earned within the province"-Interpretation of contract contract of agency or sale- Taxation Act, R.SB.C., 1924, c. 254-Income Tax Act, R.SB.C., 1936, c. 280. 476
INCOME WAR TAX ACT, R.S.C., 1927.
INSANE PATIENT-Municipal corporation ordering his confinement - Persons executing order-Dismissal of action for
D E X
INSANE PATIENT-Concluded damages against them by patient after his discharge-Insolvency of plaintiff in the action-Payment of lawyers' costs incurred by them assumed by resolution of city council-Transaction as to amount due-Action by ratepayers to annul resolution-Whether confinement of insane patient within the duties of a municipality-Article 60 C.C.P.-Cities and Towns Act, R.S.Q., 1925, c. 102.......... 257 See MuNiclPAL INSURANCE
See CoNsTiruiONAL LAw 2...... 429 INSURANCE (LIFE)-Husband and wife -Insurance contract or policy-Change of beneficiary - Loan and surrender cash values-Cash advances by insurance company upon sole security of policy-Insured appointing his wife as beneficiary-Wife asking and receiving cash advances - Whether a "loan"-Wife endorsing company's cheque in favour of husband and proceeds deposited in his bank account- Prohibition for the consorts to confer benefits inter vivos upon each other- Obligation by the wife with or for her husband transaction in conformity with Husbands' and Parents' Life Insurance Act, R.S.Q., 1925, c. 244-Articles 1265, to 1786 C.C.1-In 1917, an "ordinary life policy" of insurance for $50,000 was issued by the appellant Assurance Society upon the life of one Larocque, the latter being also styled the beneficiary. The policy contained (in general) the customary clauses usually to be found in that class and form of insurance policies.
More particularly, the insured had the right to change the beneficiary by written request; and it was provided that "such change must, however, conform to the laws of the province in Canada in which the insured resides * * * ". There was also inserted in the policy a table called "Table of loan and surrender values per $1,000 of insurance"; and that Table showed that, after the policy had been in force for three years, a fixed cash value for each $1,000 of insurance would be paid at the request of the insured and that 95% of such cash value was to represent what was therein called "the loan value". At any time while the policy was in force, after three full years' premiums had been paid, the appellant Assurance Society obliged itself to advance, on proper assignment and delivery of the policy and on its sole security, a sum which, with interest, would not exceed 95% of the cash value at the end of the current policy year (as stated in the Table). Interest at the rate of 6% per annum would be payable on the amount of the loan. Failure to repay such "loan", or to pay interest thereon, would not INSURANCE (LIFE)-Continued avoid the policy, except under certain specified circumstances. In 1921, the insured, exercising his right to do so and complying with the necessary formalities, appointed his wife, the present respondent, beneficiary of the insurance policy;
and the change was duly accepted by the appellant Assurance Society. In 1930, i.e., over ten years after the issue of the policy, the respondent asked for and received from the appellant a cash advance of
$17,000, of which S2,645.50 was applied in payment of the annual premium then due.
The amount of the cheque given to the respondent by the appellant was for $15,244.21, the surplus representing the accrued dividends. The respondent then endorsed the cheque in favour of her husband. and the latter deposited it in his own bank account. In connection with the advance so made, the respondent signed a document, called "special contract", wherein it was stated that the appellant had made to the respondent a cash advance, receipt being thereby acknowledged, upon the security of the value of the policy which was duly assigned to the appellant by the respondent. The respondent also therein agreed with the appellant as to the condition upon which such advance and any future additional advances, would be made, these conditions inter alia dealing with the payment of interest and providing that unpaid interest would be added to the existing loan; it was also agreed that, upon default in payment of any premium, "the total of all advances and any interest shall not be repayable in cash but shall be deducted by the Society from any sum
* *
* otherwise applicable to the purchase of paid-up or extended term insurance"; though it was also stipulated that the appellant "Society may exercise all powers necessary to effect repayment of all advances and any interest thereon".
Appended to that document was a declaration signed by the insured that "I hereby consent to the execution by my wife of the foregoing agreement and to the advance or advances made or to be made thereunder": and, at the same time, the insured signed a "special assignment" of the policy to the appellant Society.
In.
1932 and 1933, the respondent applied to the appellant Society and obtained two further advances, providing mostly for payment of premiums due, thus bringing the total advances up to $21,977. Default was made in payment of annual premiums in December, 1933, and the last of several extensions of time for payment terminated in August, 1934. Thereupon, the total of the advances, with accrued interest, became deductible by the appellant Society from any sum or amount under the policy which would otherwise have been applicable to the purchase of paid-up or
INSURANCE (LIFE)--Continued extended term insurance; and, as the advances and interest due were in excess of such sum or amount, the policy, as contended by the appellant Society, became null and void and was not in force at the death of the insured in December, 1936. The respondent, after her request for the payment of the amount of the policy had been refused, brought the present action against the appellant Society, alleging that the money advances were absolutely and radically null and void and of no effect, that, consequently, the policy should be held to have been still legally in force at the death of the insured and that the appellant Society should be condemned to pay the full amount of the policy. The grounds, upon which the action was based, were that, although admittedly the cheque for the money advanced was made to her order, the respondent had immediately endorsed it over to her husband, who had deposited it in his own bank account; that she had not received any of the money thus advanced; and that it followed that the whole transaction was: 1st, contrary to articles 1265 C.C., as being in some manner a benefit inter vivos conferred by the consorts upon each other and not in conformity with the provisions of the law under which a husband may insure his life for his wife; 2nd, a transaction whereby the wife had bound herself with or for her husband, contrary to the provisions of article 1301 C.C.; and 3rd, a transaction not in conformity with the provisions of the Husbands' and Parents' Life Insurance Act whereunder, exclusively, the consorts were authorized by the Civil Code to confer benefits inter vivos upon each other. The trial judge, holding that the cash advance to the respondent was void, maintained the respondent's action to the extent of $46,042.88, deducting part of the advances used for the purpose of the payment of the premiums due at the time of the advances.
That judgment was affirmed by the appellate court "sans admettre toutes les raisons donnies par la cour inf6rieure". Held, reversing the judgment appealed from, (Q.R. 71 K.B. 279) that the respondent's action against the appellant Assurance Society should have been dismissed. The appeal to this Court was allowed. The money advances to the respondent were not made contrary to the provisions of article 1265 C.C.-The transfer of the policy by the insured to his wife was not a benefit inter vivos conferred in contravention of that article, as, by its very terms, a husband may, subject to certain conditions and restrictions, insure his life for his wife "in conformity with the provisions of the law", and, more particularly, with those contained in the Husbands' and Parents' Insurance Act.-Also, the endorsement by IS.C.R. INSURANCE (LIFE)--Continued the respondent, in favour of her husband, of the cheque issued by the appellant
Society was not of the Society's concern.
The prohibition contained in that article is a prohibition addressed to the consorts themselves: they may not alter the covenants contained in their marriage contract and they cannot in any other manner confer benefits inter vivos upon each other;
but that prohibition does not affect the appellant Assurance Society, except possibly in so far as the latter may have acted as an accomplice to the contravention of that article by the consorts themselves. Assuming, without formally deciding it, that the provisions of article 1265
C.C. would forbid a husband from insuring his life for the benefit of his wife unless he does so within the terms of the Husbands' and Parents' Insurance Act (the wording of the exception "in conformity with the provisions of the law" does not clearly exclude any provisions of the law found to be applicable and not expressed in the Act), the insurance policy in this case does not detract from the conditions enacted in that statute and, therefore, cannot be held to have been forbidden by, and to be contrary to, the provisions of article 1265 C.C.-As long as an insurance policy does not infringe any of the "conditions and restrictions" essentially required under that statute, the latter must be construed as authorizing the insertion of such accessory clauses as admittedly are usually to be found in ordinary insurance policies. Also, section 3 of the Act authorizes a husband to "insure his life or appropriate any policy of insurance held by himself on his life for the benefit of his wife"; and the word "any"
connotes the idea of an ordinary insurance policy containing the usual and customary clauses. Moreover, the condition of the policy, upon which the respondent relies for contending that the policy was still in force at the death of her husband, is not to be found in the above statute and the necessary consequence of the respondent's argument would be that such a condition should not be read into the policy, thereby entailing a fatal result for the respondent's claim. Finally, if the conditions, which the respondent contended should be disregarded, are in conflict with the above statute, or, as an indirect consequence, in conflict with article 1265
C.C., they should be held to be contrary to public order, and therefore, such conditions would render void the appropriation itself made under the statute;
then the insured himself would have remained entitled to the benefits. of the policy and the respondent would have no ground of action. The cash advance made upon the strength of the policy by the appellant Society to the respondent was not a loan whereby the respondent
INSURANCE (LIFE)-Continued bound herself (s'est obligde) either with or for her husband, contrary to the provisions of article 1301 C.C. and the obligation contracted by her was accordingly valid (although the respondent might be taken to have made to her husband an illegal gift inter vivos of the sums so advanced). Emphasis must be put on the word "bound" as that is the mischief, and the only mischief, which article 1301 C.C. is intended to prevent.-It was a term and condition of the policy that, at each of the periods mentioned in the "Table of loan and surrender values", the appellant Society obliged itself to advance a certain sum stated in the Table. This was one of the benefits and advantages conferred by the policy; it was, therefore, one of the benefits and advantages appropriated by the insured to his wife and conferred upon her at the date of her acceptance of the appropriation of the policy to her: she was at liberty to claim that benefit and advantage, at least after the expiration of ten years of the life of the policy. There was no new obligation assumed by either the husband or the wife in the "special contract": the respondent did not, by that document, or on that date, or in respect of the advance payment made to her, bind herself to anything to which she was not already subject by having accepted the appropriation, of the policy.-The appellant Society, when making the cash advance, was merely carrying out the contract which it had made long before with the insured and with the beneficiary. The appellant Society was bound to carry it out and could have been compelled to carry it out at the suit of the beneficiary: it was only paying its debt to the respondent beneficiary and it was none of its concern what the respondent would do with the money. Hamel v. Panet (2 App. Cas. 121; 3 QL.R. 173), Trust & Loan Co. of Canada v. Gauthier ([1904] A.C. 94), Laframboise v. Vallibres (11927] S.C.R. 193), Rodrigue v. Dostie ([1927] S.C.R. 563), Banque Canadienne Nationale v. Carette ([1931] S.C.R. 33), Banque Canadienne Nationale v. Audet ([19311 S.C.R. 293),
Daoust, Lalonde & Cie v. Ferland & New York Life Insurance Co. ([1932] S.C.R. 343), Lebel v. Bradin R.L.n.s. 16), Joubert & Turcotte v. Kieffer (Q.R. 51 S.C. 152) and Lacoste- Tessier v. The Bank of Montreal (Q.R. K.B. 148) distinguished. In none of the cases which have come before the courts, and in particular in none of the casee referred to in the reasons for judgment of the appellate court in this case, did the question arise of the effect of advances made by an insurance company upon a policy similar to the one now before this Court. In every one of those cases a loan had been made by a third party, generally a bank, on the security of the INSURANCE (LIFE)-Concluded policy. The lender was at perfect liberty to make the loan, or not, to the wife.
The transaction which the courts, in each of these cases, had to consider was not covered by an anterior contract. These circumstances are of primary importance as distinguishing those cases from the present one. Upon the proper construetion of the insurance contract or policy and also of the "special contract", the cash advance made by the appellant
Society to the respondent was not a
"loan" within the meaning of that word.
(Articles 1762 to 1786 C.C.).
EQUrrABLE
LIFE v. LAROCQUE.............
INSURANCE
(SHIPPING) -Insurance of cargo of wheat-Wheat, while in winter storage on berthed vessel, damaged by vessel sinking-Insurer paying insurance, taking over the damaged wheat, partially salvaging it, and, as endorsee of bills of lading, suing carrier for damages-Whether right of action-Bills of Lading Act,
R.S.C., c. 17, s. 2-Counterclaim by carrier for contribution in general average.
...................................
JUDGMENT - Execution - Moveable property-Bailiff's sale-Seizure super non possidente-Validity of seizure and sale-Whether adjudicataire acquires title
-Right of owner of property to revendicate it against adjudicataire-Articles 665 and 668 C.C.P.-Article C.C...... 1
2.- Defendant seeking to set off, against plaintiff's execution on judgment in action in Supreme Court of Ontario for damages for trespass, judgments obtained by Workmen's Compensation Board in District
Court through certificates filed under s. 108 of Workmen's Compensation Act, R.S.O.,
1987, c. 9204, and assigned to defendant- Whether mutual debts-Judicature Act,
R.S.O., 1987, c. 100, ss. 1924-Propriety of the procedure taken - Appeal to
Supreme Court of Canada on question of practice in Ontario................
JURISDICTION - Declinatory exception
-Agreement with foreign company for sale of its goods in Canada-Business carried on in the province of Quebec with head-office located therein-Net commission on sales to be divided betweeri foreign company and parties residing in the province-Action for accounting of such commissions taken by one party against foreign company-Whether provincial courts competent to hear the issue-Whether whole cause of action arise in the province-Article 94, 103 C.C.P........
JURISDICTION-Concluded
See LAW. See CRIMINAL LAW 1.
JURY-Sufficiency of and justification for findings............................ 2.-Functions of appellate court when dealing with verdict - Findings of jury. ................................... LAND-Agreement to purchase, from tax sale purchaser
LEASE-Notice by lessee of intention to terminate lease-Expressed condition that "no such notice shall take effect prior to" a certain date-Meaning of the words "take effect"-Intention of the parties.]- The respondent leased from the appellant certain premises in Montreal for a term of ten years commencing on the 1st of May,
1939, the annual renting being $46,931 payable by monthly instalments. The notarial lease contained the following clause: "Notwithstanding the term of the present lease as hereinbefore provided, the Lessee shall have the right: 1. To terminate the same for the whole or for any portion of the said tenth floor by giving to the Lessor, on the 1st day of any month from 1st November to 1st May, inclusive, in any year during the continuance of this lease, one year's written notice of its intention so to do, and one year from the date of such notice or notices this lease shall become null and void and without effect in so far as the space covered by such notice or notices is concerned, it being expressly understood that no such notice shall take effect prior to the 1st day of November, nineteen hundred and forty (1940)." The respondent, by letter dated 4th of January, 1940, gave the appellant twelve months' notice as from the let of February, 1940, of its intention to terminate the lease in full on the 31st January, 1941. The appellant refused to accept this notice on the ground that, according to the above-mentioned clause, the lease could not be terminated before the 1st of November, 1941. controversy in this case turns upon the meaning of the last phrase of that clause, the appellant contending that the meaning was that no notice could commence to operate as a notice prior to the let of November, 1940, with the result that the lease could not come to an end before 1st November, 1941; while the respondnet contended that that phrase should be construed as meaning that "no such notice LEASE-Concluded shall take effect" in terminating the lease prior to the first day of November, 1940", and that notice of cancellation could be given at any time up to 1st November,
1939, so that the lease could come to an end on or after the 1st November, 1940.
The trial judge upheld the construction put forward by the appellant; but the appellate court, Barclay J. dissenting, reversed that judgment.
Held, the Chief
Justice dissenting, that the construction indicated by the respondent is more in conformity with the intention of the parties as gathered from the words used by them in drawing up the clause and, therefore, the judgment appealed from should be affirmed.
.....
...................
LIFE INSURANCE.
See LiFE.
MARRIAGE-Suit for annulment of. 160
MASTER AND SERVANT-Negligence- Responsibility of master for injury to servant arising from use of defective system of working supplied and operated by independent contractor.]-Plaintiff was employed by defendant to assist in sawing wood on defendant's farm. The sawing equipment was supplied and operated by one L., who was paid for it, including his own labour, at $1.25 per hour. In the course of the operations, a large cast iron fly-wheel on the equipment burst and a section of it struck and injured plaintiff, who sued defendant for damages. There were findings at trial, held in this Court to be justified on the evidence, that the accident occurred while the saw was running free and that the excessive speed at which it was then operated caused the flywheel to burst; that the method of the sawing operations was a defective system and that, having regard to the danger,
L. was not a competent person to take charge of and operate the equipment;
and that plaintiff's injury was due primarily to the dangerous system of working.
Held: Assuming (as defendant contended)
that L. was an independent contractor, nevertheless defendant was liable. It was defendant's duty to plaintiff to supply and install proper equipment for sawing the wood and a proper system of work so far as care and skill could secure these results, and to select properly skilled persons to manage and superintend the equipment, and this obligation is personal to the employer who cannot free himself from his duty by a mere delegation (Wilsons &
Clyde Coal Co. v. English, [19381 A.C. 57;
[1937] 3 All E.R. 628); and the employer can no more escape the consequences of
MASTER AND SERVANT-Continued non-performance of said personal obligation to his employee merely by employing an independent contractor than he could by placing the responsibility on the shoulders of another employee (this is implicit in the reasons in the Wilsons' case, supra). Per the Chief Justice: It flows from the reasoning in the judgments in the Wilsons' (in the House of Lords, supra, and the Court of Session, 1936, S.C. 883) that the obligation which the law imposes upon the employer, and which is involved in the contract, is that he shall, provide a safe system of working in so far as the exercise of reasonable care and skill will enable him to do so; but he does not perform this obligation by simply employing an agent who is an independent contractor to whom he delegates the performance of it. (McKelvey v. Le Roi Mining Co., 32 Can. S.C.R. 664, and other cases in this Court, also discussed).
.....................
2.- Negligence - Servant instructed to clean premises-Burning of debris by servant without specific instructions-Fire causing damages-Liability of employer- Whether servant's act within scope of employment-Breach of city by-law-Commission of alleged illegal act by servant.] sued for damages to their properties from a fire which they alleged was caused by the negligence of servants of the appellant company.
The latter's manager ordered two of its servants to clean out the basement of its store and place the rubbish in an ash can outside the premises. The employees did this and then, without any special instructions in that regard, tried to burn the rubbish. The fire spread out of control and damaged the property of the respondents. The trial judge held that the evidence, as to the actions of one of the servants and as to the instructions given him and the other servant, showed that the former had ignited the fire in the can, that in doing he was negligent, and that he at the time acting within the scope of his employment. The judgment of the trial judge was affirmed by the appellate court. Held, affirming the judgment appealed from ([1942] 1 W.W.R. 375), that the appellant company was liable for the damage caused by the fire.-The findings of fact by the trial judge have been accepted by the appellate court, and the evidence does not disclose anything which would justify a reversal of these judgments by this Court.-The servants were "not on a frolic of their own"; but they were in fact doing work, which was intended to be of service to their master and was in fact closely connected with acts which they were specifically instructed to do. burning of the debris was, therefore, as matter fact, within the course of the MASTER AND SERVANT-Concluded servant's employment. Lockhart v. Canadian Pacific Railway Co. ([19411 S.C.R.
270) followed.-Also, in view of the finding of the trial judge, the appellant cannot succeed on the ground raised by it, that the act of lighting a fire at the place and under the circumstances in which it was lit was an illegal act, being in breach of certain city by-law and that, there being no express order given by the appellant to the servant to light the fire, no authority to light could be implied. Dyer v. Munday ([1895]
1 Q.B.D. 742)
ref.
W. W. LIMITED CITY
MINES AND
MINERALS
Grant of land by Dominion-Petroleum rights and royalties-Transfer of Natural Resources to provinces-Reservation of royalty- Rights of provinces.]-In 1908, a patent from the Crown (Dom.) was issued to the predecessors in title of the respondent, granting them title to all minerals other than precious metals. At that time, there was a royalty on coal prescribed by regulation, but there was none in respect of petroleum. The contentions of the appellant are that, having in mind the provisions of the habendum clause and the regulations in force at the time of the issue of the patent, the Crown (Dom.) could have imposed a royalty on petroleum recovered from the land and that the Crown
(Provincial) has. succeeded to such rights by virtue of the agreement of transfer of the Natural Resources of 1930; and the appellant also contended that at the time of the grant royalties were authorized in petroleum discovered by prospectors and that the language of the patent was wide enough to make such regulations applicable.
Held that the provisions of the patent were not such as to reserve to the
Crown (Dom.) a right to impose new royalties in the future. If the Crown, like any other vendor, desires to reserve such rights, such reservations must be expressly stated.-The regulations do not prescribe any royalty in respect of the minerals granted by the patent in question and such being the case there was no royalty reserved by the Dominion which could pass to the province.-The rights acquired under a grant in freehold made for a definite purchase price, as in this case, are altogether different from rights which are acquired under a prospector's licence.
Judgment of the Appellate
Division
([1942] 1 W.W.R. 321) affirmed.
............
..............
2.---Owner of mineral land transfering surface rights
Non-assessability of his mining rights thereafter - Invalidity of subsequent tax sale in so far as purporting to affect mining righta-The Assess- MINES AND MINERALS-Concluded ment Act, R.B.O., c. 238, ss. 40 (4) (10), 181; R.S.O., 1937, c. 272, ss. 14 (1), 15 (1)-The Conveyancing and Law of Property Act, R.S.O., 1927, c. 187, ss. 15, 16, 17.............................. MORTGAGE.
Acr.
MOTOR VEIICLES-Negligence-Accident causing injury to guest passenger in motor car-Action by her against driver for damages-Motor Vehicle Act, Nova Scotia, 1932, c. 6, s. 183-Question whether accident caused by "gross negligence or wilful and wanton misconduct" of driver -Findings by jury-Sufficiency of and justification for findings.]-Respondent sued appellant for damages for injury caused to her by an accident occurring while she was being transported as appellant's guest without payment, in a motor car driven by appellant.
By s. 183 of The Motor Vehicle Act, Nova Scotia (1932, c. 6), she had a cause of action only if the accident was caused by "the gross negligence or wilful and wanton misconduct" of appellant which contributed to the injury. At the trial the jury found (inter alia) that there was on appellant's part gross negligence which caused the accident and that it consisted of "reckless driving."
Held, affirming the judgment of the Supreme Court of Nova Scotia en banc, M.P.R. 45, that the jury's said findings were sufficient and had sufficient certainty of meaning, and that on the evidence the jury was entitled to make said findings and that respondent should recover. Per the Chief Justice: Comment as to attempting to define or replace by paraphrases the phrase "gross negligence" or "wilful and wanton misconduct", and observations as to a trial judge's duty in assisting a jury in an action based upon said enactment. The said phrases imply conduct in which, if there is not conscious wrong doing, there is a very marked departure from the standards by which responsible and competent people in charge of motor cars habitually govern themselves. Subject to that, it is entirely a question of fact for the jury whether conduct falls within the category of one or other of said phrases. 2.-Negligence-Collision at street intersection-Responsibility for the accident- Duties of drivers-Nature of roads and intersection-Advantages of trial judge on questions of fact-Visit by trial judge to site of accident-Duties as to yielding right of way, stopping before turning, and (a. 62 (1) of Highway Traffic Act, Man.) MOTOR VEHICLES-Continued as to driving "wherever practicable" on right half of highway.]-In an action for damages arising out of a collision at a street intersection between plaintiff company's truck, proceeding westerly, and defendant's automobile, which had been proceeding northerly and was turning right to go easterly, the trial judge (Adamson
J.) gave judgment for the plaintiffs (49
Man. R. 288, at 289-290), which was reversed (by a majority) in the Court of
Appeal for Manitoba (49 Man. R. 288).
The Supreme Court of Canada now restored the judgment of the trial judge, holding that his findings should be accepted because, the questions involved being almost entirely questions of fact, he manifestly had advantages over an appellate tribunal and had the additional advantage of having visited the site of the accident, the visit having been considered by counsel and the judge to be necessary in order to appreciate the evidence.
This Court agreed with the trial judge that defendant was negligent in not stopping and giving the truck driver the right of way. As to conduct of the truck driver, this Court held that, even assuming (contrary to the trial judge's view) that it was "practicable" for him to drive upon the right half of the highway (as required, "wherever practicable," by s. 52 (1.) of the Highway Traffic Act, Man.), yet the actual position of his vehicle was merely a sine qua non and not a causa causans.
3.-Negligence of driver of car rented to driver-Statutory liability of owner-Driver acquires car through false representation-"Consent express or implied" to driver's possession- Motor-vehicle Act,
R.S.B.C., 1936, c. 195, s. 74A.1-The respondents were injured owing to the negligence of the defendant W. when driving an automobile which he had rented from the appellant company. W. rented a car, but he brought it back owing to engine trouble a few hours later and another car was given to him in substitution. He had no driver's licence, and was given the first car by falsely representing that he was one
H., whose licence he had in his possession and in whose name he signed the rental contract.
On bringing the car back, the appellant company's employee then on duty (not the same employee who carried out the original transaction) looked up the hire contract and asked W. if his name was H., and W. replied "Yes". The employee, being satisfied that W. was the individual who had rented the car brought in, delivered him the second car. Subsection 1 of section 74A of the Motor
Vehicle Act deals with the civil responsibility of an owner for "loss or damage sustained * * * by reason of a motorvehicle on any highway * * * " where
MOTOR VEHICLES-Concluded the "person driving or operating the motorvehicle * * * acquired possession of with the consent, express or implied, of the owner * * * ". Held, affirming the judgment appealed from (57 B.C.R. 251), Taschereau J. dissenting, that W. acquired possession of the car with the express consent of the employees of the appellant company, within the meaning of ss. 1 of section 74A of the Motor Vehicle Act, even though the action of these employees was induced by W.'s false statem'ent: an express consent is given, within the meaning of the enactment, when possession was acquired as the result of the free exercise of the owner's will. Per Taschereau J. dissenting.-There was no "consent" within the meaning of section 74A, s.s. 1.-In certain cases, a consent obtained through fraud is only voidable; but when one party, as in this case, is deceived as to the identity of the other party, there is no contract at all, there being no consent, no concurrence of the wills. There was a unilateral consent that H. should take possession of the car, but there was no consent that W. should.
In order to obtain "possession" within the meaning of that section, which possession is not a mere physical possession but also the right to control, enjoy and manage it legally, it must be the result of a consent "unclouded by fraud, duress or sometimes even mistake". The consent given in this case did not confer such a possession to W.; it is as valueless as it would have been if extorted by threats or compulsion. U-DRIvE LTD. v. .....................
MUNICIPAL CORPORATION - Insane patient-Council-men ordering his confinement-Persons executing order-Dismissal of action for damages against them by patient after his discharge-Insolvency of plaintiff in the action-City council, by resolution, authorizing payment of lawyers' costs incurred by these persons-Transaction as to amount due-Action by ratepayer to annul resolution-Whether confinement of insane patient within the duties of a municipality-Article 50 C.C.P. Cities and Towns Act, R.S.Q., 1925, c. 102, ss. 381, 411, 42.1-One Kennedy, a citizen of the town of Coaticook, Quebec, was attending frequently the meetings of the city council and, on many occasions, threatened the council-men with proceedings in disqualification. In 1937, he effectively brought an action against the mayor, who resigned his office but was subsequently disqualified by the court. Some days after the issue of the writ and following a meeting of the council presided over by the acting mayor Trudeau, one of the appellants, it was decided to confine tKennedy in a lunatic asylum. MUNICIPAL CORPORATION-Con.
recorder of the town was called and, also, one Dr. Birs, who signed the required certificate; two ratepayers, Lavoie and
Garceau, now appellants, signed and swore the forms necessary for the confinement, the whole in conformity with the Lunatic
Asylums Act. Kennedy was then conducted to the asylum by Lavoie, who had in his possession a warrant of commitment signed by the recorder. Six weeks later,
Kennedy was discharged from his confinement. Later on he succeeded before the courts in recovering damages against the doctor.
He subsequently brought four other actions in damages for $1,000 each against Trudeau, Lavoie, Garceau and a council-man, Pilotte, the fourth appellant, on the ground that they had conspired together so as to achieve his confinement.
A judgment dismissing these actions was affirmed on appeal. Kennedy having died insolvent, the appellants' attorneys, not being able to collect the amount of their professional services, amounting to
$3,357.29, from his estate, requested the city to pay their bill, on the ground that the appellants were its agents and that the costs incurred for their defence were the result of acts done at its request.
A legal opinion was asked from the town attorney who reported that, though he thought that the city was not liable, he suggested that it may be advisable to settle the matter out of court by means of a transaction. The appellant's lawyers made a reduction of $100 and the city council-men passed a resolution authorizing the payment of the reduced amount in final settlement.
The respondent, a ratepayer, then brought an action against the city asking that the resolution be declared illegal and null, and he also asked for an injunction in order that payment be stopped. The city defendant decided not to contest the demand for injunction and to abide by the decision of the court as to the action. The appellants then filed an intervention and thus became the real defendants in the case. They pleaded that the respondent had not a sufficient interest to proceed as he had done, under article 50 C.C.P., as a special interest, distinct from the general interest of a ratepayer, was required under that article; that the respondent should have taken his proceedings under the provisions of the Cities and Towns Act; and they further alleged that they had acted as servants, officers and agents of the city, and that the latter should compensate them for the expenses incurred. The trial court dismissed the action and maintained the intervention, which judgment was reversed by the appellate court.
An appeal to the Supreme Court of Canada was dismissed with costs. Held that the respondent had an "interest" sufficient to entitle him to institute proceedings for
MUNICIPAL CORPORATION-Conc. the annulment of the resolution of the city council in the manner and form he has followed in the present action. Even assuming that the respondent had not the "special interest", distinct from that of an ordinary ratepayer, which had been held by numerous decisions to be required in order to enable him to proceed under article 50 C.C.P., the respondent was surely in possession of the "interest" required by the Cities and Towns Act.-Although the present action has apparently been taken under article 50 C.C.P., all the formalities of procedure followed by the respondent were in accordance with the procedure prescribed by section 411 of the above Act, under which Act a resolution of a city council, alleged to be ultra vires, can be challenged; so, whether the respondent should be assumed to have proceeded under either of these provisions of law, there was, in the premises, no difference in the procedure and the appellants have. suffered no prejudice therefrom.- Although section 411 provides that the proceedings should be by way of a "petition", the respondent's action accompanied by a writ of summons should be considered as complying with the statute; an "action" necessarily includes a "petition". Held, also, that the resolution of the city council was ultra vires.-There was no resolution of the council authorizing the appellants to effect the confinement of Kennedy. Moreover, there is no provision in the Cities and Towns Act which imposes any duties upon a municipality as to the confinement of insane persons, the persons indicated in the Lunatic Asylums Act being personae designatae and not acting as municipal officers or employees. Therefore, appellants cannot be deemed to have acted on behalf of the city in performing an act which was outside of its domain.-Also, a municipality cannot ratify an act which is outside of its powers, and, a fortiori, it can effect a "transaction" only in matters within the limits of such powers. v. .....................
NEGLIGENCE - Motor vehicles Accident causing injury to guest passenger in motor car .....................
2.-Motor vehicles-Collision at street intersection-Responsibility for the accident-Duties of drivers-Nature of roads and intersection-Advantages of trial judge on questions of fact-Visit by trial judge to site of accident-Duties as to yielding right of way, stopping before turning, and (s. 52 (1) of Highway Traffic Act, Man.) as to driving "wherever practicable" on right half of highway............... NEGLIGENCE-Concluded.
3.-Master and servant-Responsibility of master for injury to servant arising from use of defective system of working supplied and operated by independent contractor .........................
4.-Automobile-Negligence of driver of car rented to driver-Statutory liability of owner-Driver acquires car through false representation-"Consent express or implied" to driver's possession-Motorvehicle Act, R.S.B.C., 1936, c. 195, s. 74A.
....................................
39 1
5.-Master and servant
Servant instructed to clean premises-Burning of debris by servant without specific instructions-Fire causing damages-Liability of employer-Whether servant's act within scope of employment-Breach of city bylaw-Commission of alleged illegal act by servant ............................
PARENT AND CHILD-Gift-Descent of property-Sum transferred from father's bank to son's bank account-Death of father intestate-Transaction held to be a gift-Question whether gift was in advancement-Evidence-Burden of proof- Law of Nova Scotia-R.S.N.S., c. 147, s.18--Appeal-Claim for accounting
-Matters of fact-Concurrent findings in courts below.1-A deceased, resident in
Nova Scotia, died intestate. In his lifetime a sum to his credit in his bank account was transferred to a bank account in the name of his son. In disputes after deceased's death, between his widow, suing as administratrix of his estate, and the son, in regard to transactions or arrangements in deceased's lifetime in connection with his affairs, one question was, whether said sum belonged to deceased's estate, or whether it was transferred as a gift, and, in the latter case, whether it was a gift to the son in advancement on account of or in lieu of his distributive share in the estate. Held: On the evidence, the transfer was a gift to the son; and, further
(reversing on this point the judgment of the Supreme Court of Nova Scotia en banc,
M.P.R. 131), it was not a gift in advancement but an absolute gift. The question whether it should be held to have been made in advancement must be decided in accordance with the Nova Scotia statute, R.S.N.S.,
1923, c. 147 (Of the
Descent of Real and Personal Property)
and that statute alone. By force of s. 13 thereof, there is no presumption, and the burden of proof is on the party asserting, that the gift was made in advancement.
Furthermore, in view of clauses (a), (b)
and (c) of s. it would seem to follow that, in order that the intention of ad- PARENT AND CHILD-Concluded vancement may be held as established "by evidence taken upon oath before a court of justice" under the provision in clause (d), the evidence must be of such a character that it is as forceful, cogent and unequivocal as the writing required by clauses (a), (b) and (c). This reasoning is further strengthened by the words "and not otherwise" at the end of s. Upon the above view of the law, and upon the evidence, it could not be said that the gift was made in advancement. Appeals on certain other questions decided by said Court en banc were dismissed.
As to certain items for which appellant was held liable to account, this Court, having held that the contest in regard to them was strictly confined to matters of fact, pointed out that appellant "comes to this Court with concurrent findings against him in respect of matters strictly of fact and as to which he was unable to point to any specific and material mistake in the decisions appealed from", and that this Court found no reason to interfere therewith. WarrFoRD v. Warr- PATENT - Validity - Infringement - Bleaching agent derived from vegetables (preferably from soya bean) for application to wheat flour-Discovery and invention - Patentability of product - "Manufacture or composition of matter" (s. 2 (d) of Patent Act, 1935, c. 39)-"Prepared or produced by chemical processes" (s. 40 of said Act)-Claims in patent- Whether too broadly expressed.]-Continental Soya Co. Ltd., one of the defendants, appealed to this Court from the judgment of Maclean J., President of the Exchequer Court of Canada, [1941] Ex. C.R. 69, the appeal being from his holding that plaintiff's patent no. 345,534, for "Agent for Bleaching Flour" and claims in question in plaintiffs patent no. 347,251 for "Agent for Bleaching Flour and Process of Preparing the Same" were valid and had been infringed by said defendant. Held: The appeal should be dismissed. The invention embodied in the patents is a product derived from vegetables, preferably from the soya bean, and possessing properties which constitute it an effective bleaching agent for application to wheat flour. The inventors, while engaged in investigations with a view to the improvement of bread, noticed what they conceived to be evidence that the soya bean contains some substance which could be effectively utilized as such an agent. Further investigations established this as a fact and enabled them to define the conditions under which this substance could be extracted and prepared for effective use. The phrase "manufacture or composition of matter" in 2 (d) of The Patent Act, 1935 (25-26 Geo. V, c. 32) includes a product, which, as well as the process PATENT-Concluded by which it is obtained, may be patentable, if it is new and useful, in the sense of the patent law. Though the discovery, which might truly be said to have been accidental, was the starting point of the inventors, and indeed the presence in the soya bean (and in other vegetables) of a substance capable of bleaching wheat flour was the basis and essence of the process devised and the product obtained, yet there was more than discovery, there was invention in the patent sense, in the methods devised for the extraction of the bleaching substance and for the preservation of its activity, making it applicable effectively in the manufacture of bread;
the invention was patentable both as product and as process.
The invention was not one relating to a substance "prepared or produced by chemical processes"
within the meaning of s. 40 of said Act.
Everything done by the inventors was in the nature of a physical, as distinguished from a chemical, process. The application of heat for the purpose of drying the substance or the application of water for the purpose of stimulating germination could not bring either the process or the product within the ambit of s. 40. The fact that the vital processes might involve chemical processes is immaterial and does not make s. 40 applicable. The claims in the patent, in embracing the use of any substance, found in vegetables other than the soya bean, of the same nature as that obtained (by the means devised for its extraction and preparation) from the soya bean, the specification indicating the manner of obtaining the substance from other vegetables, were not too broadly expressed.
Said patent no. 345,534 (issued in 1934)
was a patent for an agent produced by improved processes and not a patent for the same invention as that to which said patent no. 347,251 and patent no. 347,252
(re-issues respectively of patents issued in related.
J. SnoaT
PHYSICIANS AND SURGEONS-Negligence-Patient injured by a burn during operation-Cause of burn not established
-Procedure followed in operation in accordance with recognized practice-Extent of responsibility of operating surgeon
-Evidence--Onus of proof-Applicability of maxim res ipsa loquitur.
.........................
PRACTICE AND PROCEDURE
Judgment - Execution - Moveable property- Bailiff's sale-Seizure super non possidente
-Validity of seizure and sale-Whether adjudicataire acquires title-Right of owner of property to revendicate it against adjudicataire-Articles 665 and 668 C.C.P.
-Article 2268 C.C.] -Judicial seizure and
PRACTICE AND PROCEDURE-Con. sale of moveable property not in the possession of a judgment debtor will not deprive the true owner of his title and will not confer on the adjudicataire a title which cannot be defeated and which he may oppose to the revendication of the true owner: neither in the doctrine nor in the jurisprudence can be found any expression of opinion to the contrary. In order to justify the application of articles 665 and 668 of the Code of Civil Procedure and of article 2268 of the Civil Code, there must have been a lawful seizure and sale of moveable property, in which case only can it be said that "the thing has been sold under the authority of law." When, under a writ of execution of a judgment, moveable property has been sold at a bailiff's sale, the owner of such property has the right to revendicate it against the adjudicataire, when the seizure has taken place super non possidente: there having been no valid seizure under the writ of execution, the adjudicataire has acquired no title to the property. No opinion is expressed as to whether moveable property seized in the possession of the judgment debtor, although he be not the owner, may be revendicated by the true owner, after the judicial sale has taken place, against a purchaser who has paid the price (always saving the case of fraud or collusion). Brook v. Booker (41 Can. S.C.R. 331; Q.R. 17 K.B. 193) foll. HAoux 2.-Election law-Judgment of Supreme Court of Canada annulling election of member for House of Commons-Report made to Speaker by Registrar-Motion subsequently made for stay of proceedings-Ruling also as to costs-Dominion Controverted Elections Act, R.S.C., 1927, c. 50, ss. 68, 69, 75.1-When a judgment of this Court, holding that the election of the respondent to the House of Commons should be annulled, has been duly reported to the Speaker by the Registrar pursuant to section 68 of the Dominion Controverted Elections Act, a motion made subsequently by the appellant for a stay of proceedings pending an application to the Judicial Committee of the Privy Council for special leave to appeal from that judgment should be dismissed. The Act clearly does not contemplate any proceedings in court after the report to the Speaker is made, except in the matter of costs (s. 75). This Court has then no power to delay or forbid any action which the House of Commons or Parliament may see fit to take following such report. When the substantive portion of the judgment has passed beyond the control of this Court, a stay of proceedings in respect of costs would not be justified, especially in view of the fact PRACTICE AND PROCEDURE-Con.
that the Judicial Committee has consistently refused leave to appeal in respect of judgments in contested election cases.
3. -Set-off judgments-Defendant seeking to set off, against plaintiff's execution on judgment in action in Supreme Court of Ontario for damages for trespass, judgments obtained by Workmen's Compensation Board in District Court through certificates filed under s. 108 of Workmen's
Compensation Act, R.S.O., 1937, c. 204, and assigned to defendant mutual debts-Judicature Act, R.S.O.,
Court of Canada on question of practice in Ontario.1-In an action commenced on
June 4, 1931, in the Supreme Court of
Ontario, plaintiff, on July 7, 1939, recovered judgment against defendant for damages for trespass, and issued execution.
The Workmen's Compensation Board of
Ontario had issued five certificates against plaintiff, at various times in the years
1927 to 1934, pursuant to the provisions of what is now s. 108 of The Workmen's
Compensation Act, R.S.O., 1937, c. 204.
The certificates were duly filed with the clerk of a district court and, under said s. 108, when so filed, they would become orders, and be enforceable as judgments, of that court.
Executions were issued thereon and kept renewed and were, on the dates hereinafter mentioned, in full force and effect. The Board on December
6, 1934, assigned all its rights, title and interest in said certificates and orders of the court, and all moneys recoverable thereunder, to one who, on February 3,
1936, assigned the same to defendant.
Defendant, on August 2, 1939, paid a sum to the sheriff on plaintiff's execution against him, and claimed to set off the balance as being the amount owing by plaintiff in respect of the five judgments of the Board (obtained through said certificates filed), acquired by defendant as aforesaid. Plaintiff disputed (inter alia)
defendant's right of set-off. The trial of an issue was directed to determine whether defendant was entitled to set off against the amount of plaintiff's judgment the amount of the Board's judgments acquired by defendant; and whether plaintiff's execution had been satisfied or how much was owing thereunder.
On this issue,
Greene J. held that defendant was entitled to such a set-off, subject to the amount thereof being determined by a reference; any amounts embodied in the
Board's judgments in the nature of penalties not to be included in computing the total amount due under them. The
Court of Appeal for Ontario
([1941]
O.W.N. 472; [19421 2 D.L.R. 120) reversed that decision and held that the claims indicated by the cross judgments were
PRACTICE AND PROCEDURE-Con. not in their nature mutual debts and there was no right, therefore, to set them off; and moreover, that defendant had not proceeded, on his claim for relief, in the proper way. Defendant appealed to this Court. Held: The appeal should be dismissed, without prejudice to any application that defendant might be entitled to make to the Ontario courts to give effect to his equity to set off the judgments secured against plaintiff by said Board and assigned to defendant. Per the Chief Justice, and Kerwin, Hudson and Taschereau JJ.: This Court should not interfere with the order of the Court of Appeal in this case on the question of practice in Ontario.
But (disagreeing with the Court of Appeal), in plaintiff's said action, judgments against plaintiff in another court, which had been assigned to defendant, could be set off, under as. 123 and 124 of The Judicature Act (R.S.O., 1937, c. 100); all that is required by these sections is that there should be a mutual debt; the debts here sought to be set off are mutual debts; the operation of the statute is not limited to cases of debts arising out of or connected with the same transaction. Bennett v. White, [19101 2 K.B. 643; Edwards v. Hope, Q.B.D. 922, at 927; Kohen v. Culley Breay & Dover Ltd., 57 O.L.R. 533, at 535, referred to. If above conclusion that the debts are mutual debts is right, it may be possible for defendant, by apt proceedings, to secure a pronouncement giving effect thereto; whether that be so or not is a question that should be dealt with by the Ontario courts. Disagreement expressed with plaintiff's contention that there was no power in the Workmen's Compensation Board to assign its judgments. Per Davis J.: Before issue of plaintiff's execution, there were proceedings or applications which defendant might have taken for the purpose of his relief now claimed. Quaere, whether there was any authority to make the order directing trial of the issue, after judgment and issue of execution. The issue of a writ of fi. fa. is an order of the court to make the money-the sheriff's authority comes from the court, not from the plaintiff (Mahaffy v. Bastedo, 38 OL.R. 192). S. 21. of The Execution Act and s. 5 of The Creditors' Relief Act (R.S.O., 1937, chs. 125, 126) referred to. There must be an inherent jurisdiction in the court over its own process, but there would seem to be no authority for dealing with an execution after it has been placed in the sheriff's hands in the manner in which the proceedings in question were taken and continued. One can quite understand under special circumstances the court invoking an equitable jurisdiction to prevent a levy under execution where the execution debtor has a plain claim of a definite and fixed amount against the PRACTICE AND PROCEDURE-Conc.
execution creditor. But where, as here, defendant acquired and held the Board's judgments (which, moreover, admittedly were subject to review as to amount in view of alleged payments upon them, and, further, included statutory penalties, which in any event were not subject-matter for a set-off) over three years before judgment in the action was given and took no step either to stay entry of judgment or issue of execution, there is no ground for intervention of any equitable jurisdiction there may be in the court. The matter is one of practice and procedure in Ontario.
(Executors of Elliott v. Crocker 1 Ont.
P.R. 13, referred to).
Co. ...................
PROMISSORY NOTE - Notes endorsed for accommodation of payee, discounted at bank by payee, and, upon non-payment, charged back by bank to endorser-Action by endorser against maker-Partial failure of consideration as between maker and payee--Circumstances alleged as affecting endorser's right of recovery against maker
-Bills of Exchange Act, R.S.C., 1927, c. 16, ss. 55, 56 (2), 67, 70, 185.1-Plaintiff sued for $3,673.75 and interest, upon three promissory notes which were made by defendant to S. and, after endorsement by plaintiff, were discounted by S. at a bank, and upon non-payment were charged by the bank to plaintiff. The notes were renewals in respect of drafts accepted by defendant in connection with a contract for sale of lumber by S. to defendant, which provided that S. should ship lumber on receipt of orders, that defendant should pay for lumber 30 days after shipment, and accept drafts up to $5,000, that payments for shipments made should be deducted from the amount of the drafts accepted, that the title to the lumber was to pass to and remain in defendant as soon as any drafts were accepted by it.
The trial judge found that there was a partial failure in respect of the consideration for the notes; that the lumber shipped fell considerably short of the estimate, and on the basis of actual quantity the amount that would be coming to S. under the contract was only $1,054.48.
He further found that plaintiff was not damnified by reason of the notes being charged to his account; that he was a guarantor, as endorser, of S.'s account with the bank to an amount of over $30,000;
that he was assisting S. financially in his lumbering operations; that he had full knowledge of said contract, and his endorsements were made for S. with the understanding that the proceeds of the lumber would be applied to reduce S.'s liability at the bank, and, as a result, to reduce plaintiff's liability; that this was done; that the notes when discounted were credited to S.'s account, reducing
EX
PROMISSORY NOTE-Continued his as well as plaintiff's liability, and when charged back again plaintiff's liability was the same as before less payments made from proceeds of the lumber; that the consideration for the notes was the providing of lumber by S.; that was the sole purpose for which they were given and the only way by which they were to be paid, and this was understood by plaintiff when he endorsed them and when they were finally transferred to him; that plaintiff was an accommodation endorser; and took the notes after they were overdue, without giving value; and he held that plaintiff was in no better position, as to recovery from defendant, than was S.; and he gave judgment for only the said sum of $1,054.48 (which defendant had tendered and paid into court) less defendant's costs. The Supreme Court of New Brunswick, Appeal Division, reversed the judgment at trial and gave judgment to plaintiff for the full amount claimed M.P.R. 385).
Defendant appealed. Held: The appeal should be dismissed. The Chief Justice would dismiss the appeal on grounds fully stated in the judgment of Baxter C.J., 15 M.P.R. 385, at 389-399. Per Rinfret, Kerwin and Taschereau JJ.: There was consideration for the drafts (and so, therefore, for the promissory notes which replaced them); the giving of them was part of defendant's obligations under its contract with S.; they were part of the consideration for the contract itself. No restriction was stipulated between the parties to the contract as to S.'s right to negotiate the drafts. Upon their acceptance, the title to the lumber passed to and remained in defendant. The contract merely called for an adjustment after all shipments had been made, should the lumber fall short of the quantity estimated. To all purposes, the acceptance of the drafts was the equivalent of a payment on account of the total purchase. Therefore there was no defect of title affecting the drafts or notes at their maturity; nor were they subject to any inherent equities affecting rights of a holder for value. Partial failure of consideration between the immediate parties to a bill cannot affect the title of remote parties (Robinson v. Reynolds, 2 Q.B. 196 Thiedemann v. Goldschmidt, 1 De G. F. & J. 4). The bank gave value, and was a holder in due course. Plaintiff was a holder for value. When the notes were charged back to plaintiff, from all points of view he gave payment for them. He was an accommodation endorser who had received no value therefor. His title to the notes was in no way defective within the meaning of the Bills of Exchange Act. Further, assuming that the notes were charged to him after their maturity, he derived his title to them through a holder in due course, and, not being a PROMISSORY NOTE-Concluded party to any fraud or illegality affecting them, he had all the rights of that holder in due course as regards defendant. Accordingly, having been compelled as endorser to pay the notes, he could recover their amount from defendant. To escape liability it was necessary for defendant to show that plaintiff was controlled by an equity inherent in the transaction and which was not compatible with the assignment of the notes after they became due;
and no such equity here existed. Plaintiff's endorsements were not given pursuant to any agreement in respect of defendant.
Bills of Exchange Act, R.S.C., 1927, c.
as. 55, 56 (2), 57, 70, 135 referred to.
AsaLEY CourER LimrrED v. AcoTT.... 331
REVENUE - Income - Deductions - Outstanding bond issue-Disbursements or expenses incurred in refunding same and replacing it by a new bond issue bearing lower rate of interest-Whether they are
"disbursements or expenses not wholly, exclusively and necessarily laid out or expended for the purpose of earning the income" within the meaning of section
6 (a) of the Income War Tax Act, R.S.C.,
1927, c. 97.1-The appellant company, in
1936, had $27,615,000 par value bonds maturing in 1951. In order to reduce the annual outgo for interest and exchange charges, it was decided to redeem a portion of that bond issue to an amount of
$15,000,000 (the balance being redeemed out of proceeds of the sale of investments) and to replace the same by a new issue of bonds bearing a lower rate of interest. The result of the operation was to reduce the fixed interest charges by the sum of $275,000 per annum, a total saving of $303,119.18 being made, with a decrease in the exchange charges being added. In connection with the operation, the appellant company incurred certain disbursements and expenses amounting to $2,282,- 679.42 and proposed to amortize the same over the life of the new bonds, the amortized amount sought to be deducted in
1936 amounting to $104,596.04.
In addition to that amount, there was a direct expenditure in that year of $79,166.64 representing the overlapping interest between the date of the calling of the old bonds and the date of their retirement, interest during that period of sixty days having been paid on both sets of bonds.
The appellant company claimed the right to deduct these amounts from its taxable income for 1936, and further amounts for each year during the period of amortization. These deductions were disallowed by the Commissioner of Income Tax, whose decision was affirmed by the Minister of
National Revenue. An appeal from this decision to the Exchequer Court of Canada was dismissed with costs. Held, affirming the judgment appealed from ([1941]
REVENUE-Continued
Ex. C.R. Rinfret and Taschereau JJ. dissenting, that the above disbursements or expenses incurred by the appellant company were "not, wholly, exclusively and necessarily laid out or expended for the purpose of earning the income", within the meaning of section 6(a) of the Income War Tax Act. Per the Chief Justice-The sums borrowed by means of the original issue of debentures were capital, as distinguished from income, and the sums borrowed by the second issue of debentures for the purpose of retiring the earlier issue were also capital. The sums which the appellant company seeks to deduct are sums paid in respect of capital and they are not expenses incurred in the process of earning income in respect of which the appellant company is assessable. Per Rinfret and Taschereau JJ. (dissenting)-The several elements of the operation performed by the appellant company are essentially linked together and inseparable. In order to pay a lower interest and to get rid of the exchanges, it was necessary to redeem the original bonds; and the expenses required to achieve that result were wholly, exclusively and necessarily laid out for the purpose of decreasing the fixed interest and exchange charges and, therefore, "for the purpose of earning the income". Accordingly, the disbursement or expense so incurred come strictly and literally within the class contemplated by section 6 (a) of the Income War Tax Act and should have been allowed as a legitimate deduction in computing the amount of the profits or gains of the appellant company within the meaning of that section. LIaHT, & PowER CoNs. v. THE 2.---Crown - Sales and Excise taxes "Fair price on which the tax should be imposed", as determined by the Minister under s. 98 of Special War Revenue Act (R.S.C., 1927, c. 179, as amended by 23-24 Geo. V, c. 50, s. 20).1-Respondent, a company which manufactured and sold toilet articles and medicated preparations, had, prior to January 1, 1939, sold its products direct to chain stores and wholesale dealers and paid sales and excise taxes on the basis of the prices charged. In December, 1938, a company-hereinafter called B. Co--was incorporated for the purpose of selling in Canada respondent's and other products, and by an agreement of January 1, 1939, B. Co. became sole distributor in Canada of respondent's products, and was to sell them at the prices previously charged by respondent (unless respondent designated other prices) and to pay to respondent certain prices, which, it was calculated, were less than B. Co.'s selling prices by amounts estimated to have been the cost REVENUE-Concluded to respondent of selling, of which it was relieved. Respondent thereafter paid sales and excise taxes on the basis of prices received by it from B. Co. The Minister of National Revenue, in expressed pursuance of the powers vested in him by s. 98 of the Special War Revenue Act (R.S.C., c. 179, as amended by 23-24 Geo. V.
c. 50, s. 20), determined that these lastmentioned prices were less than the fair prices on which such taxes should be imposed, and that the prices at which B. Co.
sold the goods to dealers were the fair prices on which the taxes payable by respondent should be imposed; and by information in the Exchequer Court the
Crown sued for the further taxes claimed
(and penalties). The claim was dismissed
([19411 Ex. C.R. 155), and the Crown appealed. Held: The appeal should be allowed and the Crown should have judgment for the additional taxes payable as a result of the Minister's determination
(and also for the penalties provided for by s. 106 (5), of the Act). Per the Chief
Justice and Davis J.: The Minister's determination under s. 98 is a purely administrative act and is not open to review by the Court; and even if it may be said to be of a quasi-judicial nature, then all that was necessary was that the taxpayer be given a fair opportunity to be heard, and to correct or contradict any relevant statement prejudicial to its interest (Board of Education v. Rice, [19113 A.C. 179, at
182), and that was done. Per Rinfret,
Kerwin and Hudson JJ.: S. 98 confers upon the Minister an administrative duty which he exercised and as to which there is no appeal; and in any event it was clear that he acted honestly and impartially and gave respondent every opportunity of being heard; and his determination must be held to be binding. (Spackman v. Plumstead District Board of Works,
App. Cas. 229, at 235, cited).
Per
Curiam: Pioneer Laundry v. Minister of
National Revenue, [19401 A.C. 127, is not applicable to the present case.
SALE OF LAND
SET-OFF-Judgments .............
SETTLEMENT
SHIPPING - Collision
Whether either one or both ships at fault-Duties of captains of ships - Whether ships followed courses agreed upon according to signals given by both-Fog and danger signals- Prompt and instant answer to signal - Delay of over half a minute before answering signal-Moderate speed in fog-Previous excessive speed-Whether contributing to collision-Rules of the Road for the Great Lakes-Rules 19, 28, 87.] -The ship New York News, owned by the Quebec and Ontario Transportation Company, Limited, and the ship Fort Willdoc, owned by Paterson Steamships Limited, collided in Lake Superior, during a dense fog, the visibility being limited to between two and three hundred feet, while proceeding in opposite directions on or about the courses usually followed by ships bound from Port Arthur or Fort William down the Great Lakes, or vice versa. The collision happened at 5.30 a.m., nine miles west of Passage Island. That point was passed by the Fort Willdoc at 4.34 a.m., this distance of nine miles being therefore made by her in 56 minutes, at an average speed of more than nine miles an hour. At 5.15 a.m. a fog signal ahead, given by the New York News, was heard by the Fort Willdoc, whose engines were ordered to slow speed head; and, almost simultaneously, the Fort Willdoc blew one blast signal, thus indicating that she was directing her course to starboard. At about the same moment the New York News gave a double blast signal, thus making known her intention to direct her course to port. If each had proceeded according to these signals, a collision would have been inevitable. After a period of between one-half and three-quarters of a minute following the double blast signal of the New York News, the Fort Willdoc gave herself a twoblast signal, thus signifying her compliance with the course declared by the New York News. Witnesses for the appellant testified that the master of the Fort Willdoc altered her course twenty-two degrees to port and proceeded at a reduced speed to meet the New York News starboard to starboard. During the above-mentioned interval of one-half to three-quarters of a minute, the New York News went full astern on her engines, in order to avoid an inevitable collision, and her master testified that, when he heard the two-blast signal of the Fort Willdoc, it was then too late for him to conform to the course thus indicated. Subsequently both ships gave fog signals. Then, the Port Willdoc, suddenly hearing a danger signal, reversed immediately her engines full speed astern, about one minute preceding the moment of the collision, but could not avoid coming into contact with the New York News, which was crossing her bow. Both ships come into collision, the stem of the Fort Willdoc hitting the port side of the New York News with the result that both suffered severe damages. The local judge in Admiralty for the province of Quebec, L.
CaLnon J., holding that the New York
News was responsible for the collision, maintained the action brought by the Fort
Willdoc against the respondent here and dismissed the counter-claim.
The Exchequer Court of Canada, Maclean J., reversed that judgment and held that both vessels were equally at fault in bringing about the collision. Held, Duff C.J. and
Crocket J. (dissenting)
, that the New York
News was the only party to blame and therefore responsible for the collision and that the judgment of the local judge in
Admiralty should be restored. Held, also, as to the ground raised by the respondent that before the accident the Fort Willdoc was proceeding at an excessive rate of speed and thus contributed to the accident, that, assuming it to be so, this would have happened before 5.15 a.m.
when the first blasts of the whistles were heard; and, in view of what occurred afterwards, that there is no possible relation between this previous speed and the collision and that such speed could not have any bearing whatever upon the issue of liability in the present case. The Pemaquid (255 Federal Rep. 709) foll.-Duff
C.J. and Crocket J. dissenting. Per Rinfret, Hudson and Taschereau JJ.-The duties of each steamer approaching each other head to head or on the starboard of each other are indicated in rules 22 and 25 of the "Rules of the Road for the
Great Lakes." In this case, both ships were not coming head to head, but were slightly on the starboard side of each other. The one-blast signal of the Fort
Willdoc and the two-blast signal of the
New York News were not cross-signals, as they were given almost simultaneously, and the captain of the latter so understood them. If at that moment, there has been any confusion, it was for a very short time, because immediately after the twoblast signal of the Fort Willdoc, her captain ordered her twenty-two degrees to port in order to meet starboard to starboard. The captain of the New York
News admitted having heard this last signal; if it had been otherwise, it was his duty to give immediately the danger signal, which he did not give. There was perfect understanding by both ships as to how they would meet and if such understanding had been followed, there would have been no collision. The sole and determining cause of the accident was the failure of the New York News to follow the course agreed upon, and to proceed, without giving the necessary signals, in a direction unknown to the Fort Willdoc and which she had no reason to forsee.
Per Duff CJ. and Crocket J. (dissenting)
-Both ships were to blame in proceeding at full speed in a dense fog contrary to rule 19 and both violated the same rule in not immediately reducing speed to bare steerage way on hearing fog signals, and not navigating with caution until they had passed each other; it is no defence for one ship to say that the fog signals of the other appeared to be far away.-Upon the facts, the Fort Willdoc was greatly in fault and such fault was a contributing factor in bringing about the collision-The average speed of the Fort Willdoc, more than nine miles an hour, in a dense fog, the visibility being limited to between two and three hundred feet, did not come within the category of "moderate speed", as explicitly required by rule 19 and as every consideration of good seamanship would dictate; the speed of a vessel shall not be so great as to render it impossible to stop within the "limits of observation."-Both ships in the circumstances here erred in not giving a danger signal promptly under rules and 22.-Prompt action from both ships, i.e., instant action, was demanded under the circumstances. If the Fort Willdoc had instantly signified her compliance with the course declared by the New York News, the disaster might have been avoided.-A delay of over half a minute before giving a signal, in the conditions-of the moment, was not a prompt ahi'wer within the meaning of the roiles.-ljie evidence does not show anything in the nature of an agreement between the two ships, resulting from the exchange of signals, that they were to follow a course starboard to starboard; and the final manoeuvre of the New York News was justified under rule 37. Judgment of the Exchequer Court of Canada ([19411 Ex. C.R. 145) reversed, Duff C.J. and Crocket J. dissenting. STEAMSHIPS v. THE "NEW NEWS". PATER- Co. LTD. 19 2.-Insurance - Insurance of cargo of wheat-Wheat, while in winter storage on berthed vessel, damaged by vessel sinking-Insurer paying insurance, taking over the damaged wheat, partially salvaging it, and, as endorsee of bills of lading, suing carrier for damages - Whether right of action-Bills of Lading Act, R.S.C., 1927, c. 17, s. i-Counterclaim by carrier for contribution in general average.]-There was insured with appellant certain wheat shipped on upper lakes steamer Mathewston for carriage to Monttreal via Port Colborne. The bills of lading were deposited with a bank, through which the shipper's purchase of the wheat had been financed, and which was named in the bills of lading as consignee. When-wheat from the upper lakes is destined for Montreal, the practice is to discharge it from the upper lakes vessel into the government elevator at Port Colborne and then load it into canal sized vessels. The wheat was discharged into the elevator at Port Colborne and kept there for a time; then the shipper paid the freight to Port Colborne and the elevator charges, and arranged for the wheat to be loaded at Port Colborne for winter storage there on two vessels, one of which was respondent's vessel Norton. Appellant by endorsement provided that part of the insurance covered the wheat then on the Northton "at and from Fort William and/or Port Arthur to Port Colborne, including winter storage while there on board the S/S Northton and thence to Montreal". Later the Northton with its wheat on board, sank at its winter berth. Appellant paid in full the insurance on, and took over, the wheat on the
Northton, receiving original bills of lading (duly endorsed, appellant alleged, to it) to cover the quantity, had the wheat partially salvaged, and, as endorsee of the bills of lading under which it was shipped on the Mathewston (and not basing its claim on right of subrogation)
sued respondent for damages. Respondent counterclaimed for contribution in general average. Held: It must be found upon the evidence that the bank's endorsement
(assuming it to have been sufficiently proved) on the bills of lading was merely for the purpose of permitting the shipper of the wheat to present its claim for insurance, and that appellant took over the damaged wheat by reason of its insurance obligations. It is not every endorsee, who, by reason of s. 2 of the Bills of Lading
Act (R.S.C., 1927, c. 17), is vested with the rights of action in respect of goods mentioned in the bill of lading, as if the contract therein contained had been made with himself; it is only an endorsee to whom the property in the goods passed upon or by reason of the endorsement
(Sewell v. Burdick, App. Cas. 74). As appellant did not come within this requirement, it could not succeed in the action. Held also (Davis J. dissenting):
Respondent should succeed on its counterclaim, as appellant had become the owner of the wheat before the general average expenses were incurred. Per Davis J. (in dissenting as to the counterclaim): Appellant dealt with the damaged goods as an insurance company in the ordinary course of the adjustment and settlement of the insurance; it was not the consignee or the owner of the goods; there was no contract by it, express or implied, to pay;
and it was not liabile for contribution to general average loss. Respondent may have had a possessory lien upon the damaged grain for a general average contribution but it did not attempt to exercise any such lien or to withhold delivery until any general average contribution due to it had been paid. (Scaife v. Tobin, 3 B. &
Ad. 523, referred to). Moreover, a contract of carriage of goods by water (assumed in what has been said above) did not, on the evidence, exist at the time of the loss; the original contract of carriage through to Montreal having been terminated and a new arrangement made for winter storage-a mere bailment of goods to which the rule of general average might not apply at all. NORTH
3.-Vessel damaged by striking obstruction in harbour - Dredging operations under exclusive control of Department of Marine-Duty and extent of Board in assuring safety of harbour under its jurisdiction-Reasonable care in light of existing circumstances-Knowledge of danger to navigation and lack of warning to interested owners of vessels-Levy of tolls or rates by the Board.]-Appellant's vessel, while clearing from the port of Montreal on the 19th of August, 1936, struck an under-water obstruction in the bed of the channel in the harbour and was damaged. During the years of 1935 and 1936, the Government of Canada had undertaken, under statutory authority, to deepen the channel from 30 to 35 feet. By a subsequent Order in Council. the administration, management, construction and execution of such improvement in the Montreal harbour was placed under the exclusive authority of the Department of Marine, and, by a second Order in Council, a contract for dredging was let to a firm of contractors. At the end of June, 1936, that part of the channel abreast rof Victoria pier was swept by the respondent, and no dredging was done there up to the 19th of August. On the 12th of that month, some dredging was made above that pier. Dragging at that point iby the contractor was observed by an official of this respondent between the 12th and 19th of August; but no sweeping had been done by either the Department of Marine or the respondent to test it. After the accident, a boulder of considerable size was found abreast Victoria pier; and it is admitted that that, or a similar one, was the obstruction the appellants' vessel had struck. Held Kerwin J. dissenting, that, on the facts disclosed by the evidence, no liability rests upon the respondent.-Although the harbour of Montreal is under the jurisdiction, control and management of the respondent, the execution in 1935 and 1936 of the work of improvement and deepening of the channel was exclusively under the authority of the Department of Marine, a third party over whom the respondent had no control and for whose conduct the respondent cannot be held responsible, respondent's control and administration, so far as such work was concerned, having been interfered, with, or superseded by, superior authority.-The respondent's obligation to exercise reasonable care to see that the harbour was safe for navigation still existed; but that duty must be looked at in the light of the existing circumstances. Even assuming that the onus lies upon the respondent, the evidence establishes that reasonable care, under the circumstances, has been exercised by the respondent and that the latter has performed such duty inter alia by constant notices to those interested, during the progress of the work. But the respondent was not obliged to drag or sweep in order to ascertain that the work confided to the
Department of Marine was being properly done. Only where the respondent knew, or should have known, that danger existed had steps to be taken by it to remove such danger, or suitable warning be given in respect of it.-The levy by the respondent of tolls or rates upon ships using the harbour does not make any difference in principle in respect of its liability of exercising reasonable care. Per Kerwin J. (dissenting).-The mere fact that the Crown has let a contract for the dredging of the channel has not absolved the Harbour
Commissioners, predecessors of the respondent, of all responsibility. Their duty in general is suitably expressed in the words of Lord Phillimore in Pacific Steam
Navigation Co. v. Mersey Docks and Harbour Board (22 Ll. L.R. 383 at 389); and the principles set forth in The Moorcock
(14 P.D. 64) and in The Beam ([1906]
p. 48) should be applied to this case. The
Commissioners knew that the dredging operations would throw up obstructions, but, instead of making any examination or warning the appellants of the danger, they did nothing but rely on the sweeping and dragging operations performed by the contractor, which their officers saw proceeding in connection with the dredging.
The evidence establishes that, if these operations had been properly performed, the obstruction which caused the damage would have been discovered.
In any event, the Commissioners knew of the danger to navigation resulting from probable obstructions and they did nothing to give warning of the danger to the appellants. As a consequence of that breach of duty, the Commissioners, and hence the respondents, are responsible. Judgment of the Exchequer Court of Canada, Quebec
Admiralty District ([19411 Ex. C.R. 188)
affirmed, Kerwin J. (dissenting)
.
.............................
4.- Damage to cargo-Goods damaged by contact with water coming through hold
Loosening of tarpaulins covering hatche&-Weather condition-Meaning of
"perils of the sea"-Prima facie case- Proof of negligence-Water Carriage of Goods Act, 1986, 1 Edw. VII, c. 49.1-In an action by the owner of a cargo for damage suffered through the goods coming into contact with water which came through one hold of the ship as the result of the loosening of the tarpaulins covering the hatches. Held, reversing the judgment appealed from, Bond J. ad hoc dissenting, that, according to the facts and circumstances of the case the appellant has established, and the trial judge so found, that, in view of the weather conditions existing at the time of the accident, the damage was due to a peril of the sea and that, therefore, the vessel and her owners were relieved of any responsibility. -There being more than a mere "prima facie case", it was upon the respondent to disprove it by proving negligence causing the loss, and, in this, it has totally failed. A "peril of the sea" is not defined in the Water Carriage of Goods Act, 1936, and it would indeed be very difficult to give in a law a definition which would cover all the possible cases which may arise.
"Each case must be considered with reference to its own circumstances": per Lord MacNaghten in Thames and Mersey Marine Insurance Co. v. Hamilton, Fraser & Co. (12 A.C. 484). "Perils of the sea" do not mean to cover only accidents peculiar to navigation that are of extraordinary or catastrophic nature, or arise from irresistible force: Canada Rice Mills Ltd. v. Union Marine and General Insurance Co. (67 Ll. L.R. 549). An accident of navigation, in order to constitute a peril of the sea need not be as above described; it is sufficient that it be the cause of damage to goods at sea by the violent action of the wind and waves when such damage cannot be attributed to someone's negligence. The officers and members of the crew are not bound to take all the precautions that would inevitably prevent the accident and make its occurrence impossible; they are required to exercise the care that reasonably prudent men would exercise in similar circumstances. Pandorf & Co. v. Hamilton, Fraser & Co. Q.B.D. 629; 6 Asp. 44), The Vincent McNally ([1929] 1 A.M.C. 161),
The Lighter No. 176 ([19291 A.M.C. 554). and Canada Rice Mills Ltd. v. Union Marine and General Insurance Co. (supra). Per Bond J. ad hoc (dissenting)-Under the circumstances of this case, the damage cannot be attributed to a peril of the sea. "The term 'peril of the sea' refers only to fortuitous accidents or casualties of the sea. It does not include the ordinary action of the winds and waves." (Scrutton, on Charter-parties and bills of lading, p. 268).
Where a prima fade case of loss by perils of the sea is made, it is for the goods' owner to dis- SIPPING-Concluded prove it by proving negligence causing the loss. (Scrutton, p. 261). But in this case, such a prima facie case has not been established. On the contrary, it was disclosed by the evidence that there had been negligence in the inspection of the wedges, notwithstanding the fact that the danger of their becoming loosened was a known and anticipated risk.
&
...
....... 495
SLOT MACHINE, AUTOMATIC.
SPECIAL
WAR
REVENUE
ACT,
R.S.C., 1927.
SPECIAL
WAR
REVENUE
ACT,
SECTION 16-Constitutional law-Contracts of insurance with British or foreign companies or foreign exchanges-Tax imposed on insured on premiums payable by him - Whether section 16 ultra vires - Special War Revenue Act, 1932 (D.), c. 54, s.
1, and amendment, 1940-41 (D.), c. 27, s. 4-Canadian and British Insurance
(D.) 1932, 22-23 Geo. V, c. 47, as amended by (D.) 1934, 24-25 Geo. V, c. 36. 429
SUCCESSION DUTIES-Direction in will for payment of succession duties out of residuary estate-Question as to succession duties payable on gifts inter vivos-Construction of the words in said direction in will-Succession Duty Act, 1934, Ont., ?4
Geo. V, c. 55, ss. 6 (1) (2), 10 (1).1-The deceased, whose home was in the province of Ontario, declared in his will "that all estate and succession duties payable upon or in respect of my estate or property shall be paid out of my residuary estate, and that all legacies or gifts bequeathed shall be free from inheritance tax". He had in his lifetime made gifts to certain persons. and after his death the question arose whether the succession duties payable in respect of such gifts should be paid out of his residuary estate.
The Act applicable was The Succession Duty Act,
1934, Ont. 24 Geo. V, c. 55; and particularly ss. 6
6 (2) and 10 (1) thereof.
Held, affirming the judgment of the Court of Appeal for Ontario. [1941] O.R. 269, that the donees of the gifts inter vivos were not entitled to have the succession duties payable in respect thereof paid out of the deceased's residuary estate.
v. THE
TE
.......
..............
See ADMnNISTRTIoN ESTATES..
TAXATION tax (provincial) Extra-provincial company manufacturing good-Distribution of same goods by provincial company
Whether profits from such sales are income of extra-provincial company "earned within the province"- Interpretation of contract-Whether contract of agency or sale
Taxation Act, R.S.B.C., 1924, c. 254-Income Tax Act, R.S.B.C., 1986, c. 280.1-The appellant company is a Dominion company having its head office at the. city of Hamilton, in the province of Ontario, having no office or any employees in the province of British Columbia; it manufactures automobile tires, accessories and repair equipment at its plant at the same city. The appellant company had a contract called "Distributor's Warehouse Contract," with M., W. & D. Ltd., a British Columbia company doing business entirely within that province as wholesale dealer in tires, automobile accessories, radios and electric supplies, Firestone products being about 25% of its business. The detailed conditions of the contract are given in the judgments of this Court. The appellant company, on April 8th. 1938, was assessed in respect of income in connection with sales of its products in British Columbia by M., W. & D. Ltd. The assessments were confirmed by the Provincial Minister of Finance; but they were set aside by the Supreme
Court of British
Columbia, Murphy J. Upon a further appeal to the Court of Appeal for British Columbia, the decision of the Minister of Finance was restored by a majority of that Court. Held, reversing the judgment of the Appellate Division
([1941]
3 W.W.R. 635), Kerwin and Hudson JJ. dissenting. that the contract between the parties was not one of asency with the result that M., W. & D. Ltd. would only be the agent of the appellant company and. as a consequence, the sales made by M., W. & D. Ltd. in British Columbia would be in reality sales made there by the appellant company itself. The contract must be construed as an asreement of sale made in the province of Ontario. Neither upon that contract as a matter of construction nor constitutionally the profits accruing to the appellant company from these sales may be deemed to be income earned in British Columbia.
Therefore, these profits did not come within the charge of the Income Tax Act of that province. John Deere Plow Company v. Agnew (48 Can. S.C.R. 208) applied. Per Kerwin and Hudson JJ., dissenting.-The effect of the agreement between the parties in this case is to make the distributor, M., W. & D. Ltd., merely an agent of the appellant company for the sale of its goods in the province of British Columbia.-The manufacture, in the province of Ontario, of the appellant company's goods, however necessary to the existence of its business, does not earn income. The goods are manufactured for 56()
19421
IND
TAXATION-Concluded the purpose of sale and the income is earned when the goods are sold and all the income, therefore, was earned within the province of British Columbia.-The agreement in the John Deere Plow case
(supra) is entirely dissimilar to the one in the present case. TIRE
TAX..... 476
2.- Constitutional law-Income tax- Provincial powers-Whether tax imposed on income or on person-Income from sources outside province - Dividend
Tax Act, c. 5 (Alberta)...... 435
TAXES, SALES AND EXCISE.
TRANSACTION-Effected by a municipal corporation-Validity........... 257
WAR LOAN BOND-Transfer by owner
-Signature of registered owner guaranteed by bank-Liability of the Crown
...................................
WAR MEASURES ACT, 1914.
See 4............ 339
WATER-COURSE
Dam-Raising level of-Flooding of lands-Demolition of dam
-Damages - Jurisdiction of Superior
Court to entertain claim - Superior Court or Public Service Commission have exclusive jurisdiction as to question of damages
Watercourse Act,
R.S.Q., 1925, c. 46, section 12, as amended by 18 Geo. V. (1928), c. 29.1-The appellant is the owner of some land on the
Etchemin river, in the province of Quebec, and of an island in the same river. Some i::hty years ago, a wooden dam was built on that river; it was replaced in by a concrete dam about eight inches higher and was again raised another fourteen inches or so in 1928. The dam is owned by the respondent. The appellant claimed that, through the raising of the dam, his land was damaged by flood and by erosion; and he asked that the respondent be condemned to pay the sum of one hundred and fifty dollars for damages caused during the two years preceding the date of the action and, moreover, that the respondent be condemned to demolish the dam, on the ground that it had been raised illegally and without complying with the formalities required by the
Watercourse Act (R.S.Q.,
1925, c. 46).
EX
WATER-COURSE-Concluded
The respondent pleaded that the work done was merely to put the barrage at the same level as before, that the appellant had suffered no damages and that, in any event, the Public Service Commission had exclusive jurisdiction to adjudicate upon the appellant's claim. The appellant's action was dismissed by the trial judge, which judgment was affirmed by a majority of the appellate court. Held, reversing the judgment appealed from
(Q.R.
K.B. 365), that the Superior Court was clearly the sole competent tribunal to adjudicate upon the conclusions in the statement of claim, relative to the demolition of the dam. Held, also, that the Superior Court was still possessing exclusive jurisdiction to decide any question of law arising from the demand for damages, and to pronounce a condemnation for the payment of such damages, after these damages had been assessed by the Public Service Commission (now the Provincial Transportation and Communication Board). Section 12 of the Watercourse Act
(R.S.Q., 1925, c. 46) enacting that the "damages shall be ascertained by experts" was amended in 1928 Geo. V, c. 29) by enacting that the "damages shall be assessed and fixed by the Quebec Public Service Commission." Held that such amendment has not effected any change in the then existing legislation. The legislature has merely substituted the Public Service Commission for the experts, exactly for the same purposes as formerly: the damages, instead of being ascertained and fixed by experts, were to be, after such amendment, ascertained and fixed by the Commission. Street v. Ottawa Valley Power Co. ([19401 S.C.R. 40) followed. Held, further, that, upon the fact of this case, the raising of the dam was illegal and, as a result, the raised part of the dam should be demolished and the barrage put back as it was before the works done; but, under the circumstances of this case, the demolition is not ordered to be immediate, as the respondent will be granted a delay during which he may seek to obtain the approval, in accordance with the Watercourse Act, by the Lieutenant-Governor in Council of the works done; and, ;t is also held that the appellant is entitled to $100 damages. WHARF-Con-struction of-Contract with Crown. ........................
WILL of-Priority of legacies - Abatement-Residuary legatees -Disposition of corpus of trust fund.]- Upon a consideration of the terms of a particular will, it was held, reversing the judgment of the Court of Appeal for Manitoba ([19411 3 W.W.R. 49) and re- WILL-Continued storing the judgment of the judge of first instance, that the rule in Farmer v. Mills
((1827) 4 Russ. 86), and Dudman v. Shirreff ((1870) W.R. 596) did not apply.
Robertson v. Broadbent ((1883) 8 A.C.
812), Arnold v. Arnold ((1834) 2 M & K
365) and Hichens v. Hichens ((1876) 25
W.R. 249) discussed. In re
WEST... 120
2.- Notarial form-Formalities-Declaration that testator was unable to sign- No declaration by testator himself-Validity of the will-Arts. 848 C.C. and 975
C.N. not identical-French doctrine and jurisprudence not entirely applicable - Authentic writing-Improbation - Notary acting as public officer-No presumption that will not entirely read-Arts. 848, 855,
1208, 1211 C.C.]-Where a will in notarial form contains at the end the words: "The testator being unable to sign on account of illness, gave his consent to these presents and declared them to contain his last will
* * * ", such statement must be held to comply with the formalities (to be strictly observed on pain of nullityart. 855 C.C.) required by article 843
C.C. which enacts that "the testator signs the will or declares that he cannot do so,"
principally when the facts and circumstances in this case are taken into consideration: the wording necessarily implies that the testator has given his consent to the statement made by the notary that he
"was unable to sign on account of illness."
The text of article 975 C.N. is not identical with the text of article 843 C.C.
and many other articles of the two codes relative to wills are not similar. When a court has to apply the principles and the rules of law governing a matter which must be decided according to the law of
WILL-Concluded
Quebec, the French doctrine and jurisprudence ought not to be strictly applied. A will is an authentic writing received before a public officer and makes proof of his contents until contradicted and set aside as false in whole or in part upon improbation (Arts. 1208, 1211 C.C.); and, taking into account the character of the officer, a notary, and his declaration that the will has been read to the testator, the court cannot presume hat the deed had not been entirely completed when so read. Judgment of the appellate court (Q.R. K.B. 243) affirmed. 3.-Administration of estates-Application by widow of testator for relief under The Dependents' Relief Act, R.S.S., 1940, c. 111-S. 8 (1) (M)-Construction of the Act-Condition precedent to Court making order for relief.1-On an application by the widow of a testator for relief under The Dependents' Relief Act, R.S.S., 1940, c. the onus is on the applicant to satisfy the court that her husband's will has not made reasonable provision for her maintenance; and this a condition precedent to the court making an order for relief. v. THE CORPORATION........... 4.-Direction in will for payment of succession duties out of residuary estate. 202 See SuccEssIoN WORDS AND PHRASES.
"Manufacture or composition of matter". 2.-"
Perils of the sea ". See 4............................. "Unduly". See 3 147
Cases cited
- 3 D.L.R. 391 3 D.L.R. 391
- Lodore v. Bennett A.C. 468
- A.C. 94 A.C. 94
- Rodrigue v. Dostie scr-1927-563
- Banque Nationale Canadienne v. Carette scr-1931-33
- Daoust, Lalonde & Cie., Ltée v. Ferland scr-1932-343
- Wilsons' Wilsons' case, supra
- House of Lords House of Lords, supra
- 1 W.W.R. 375 1 W.W.R. 375
- 1 W.W.R. 321 1 W.W.R. 321
- O.R. 269 O.R. 269
Statutes and regulations cited
-
- section 259
- section 252
- Section 252
- Section 259
- section 260
- sections 252
- 259
- 260
- ss. 40
- s. 14
- ss. 15
- 16
- s. 40
- ss. 16
- 17
- ss. 3
- ss. 340
- 345
- 846
- 347
- 848
- ss. 60
- 61
- 62
- 64
- 63
- s. 91.1
- s. 62
- s. 64
- s. 91
- s. 60
- 348.1
- ss. 91
- section 16
- Section 16
- 3
- sections 226
- 229
- s. 498
- s. 578
- s. 4
- Section 4
- Section 573
- s. 573
- s. 22.1
- section 3
- s. 16
- ss. 14
- SECTION 16
-
- section 48 of the Exchequer Court Act
- section 48
- section 12
- ss. 5
- 7
- 12
- section 5
- s. 12
- s. 49
- s. 54
- ss. 49
- ss. 68
- 69
- 70
- 75
- s. 11
- s. 22
- ss. 1924
- s. 183
- s. 52
- ss. 381
- 411
- 42.1
- section 411
- s. 75
-
Bills of Lading Act
-
Unresolved citations
- subsection (2)
- s. (1)
- s. 64 of Bankruptcy Act
- s. 64 of the Bankruptcy Act
- Section 348 of the Railway Act
- Section 16 of the Special War Revenue Act
- section (2)
- s. 3 of the War Measures Act, 1914
- section 54 of the Dominion Controverted Elections Act
- s. 22 of said Act
- s. (1) of said Income War Tax Act (1)
- s. 108 of Workmen's Compensation Act
- s. 183 of The Motor Vehicle Act
- s. 40 of said Act
- section 68 of the Dominion Controverted Elections Act
- s. 5 of The Creditors' Relief Act
- section 6(a)
- s. 98 of Special War Revenue Act
- s. 98 of the Special War Revenue Act
- Section 12 of the Watercourse Act