Majority
At a general meeting of the shareholders of the respondent on June 2, 1941, resolutions were passed directing that its general manager and four of its officials as of January 1, should be paid certain specified amounts as salary "free from income tax", although by the Articles -of Association of the company the directors had the power to make such arrangements.
Article 103 of the said Articles provided that the directors might from time to time appoint one of their body as managing director; Article 105 provided that the remuneration of the managing director should be fixed by the directors and Article provided that the directors might appoint such managers, secretaries, officers, etc., as they consider necessary and fix their salaries.
The resolutions passed by the shareholders remained unchanged, but changes in the Income War Tax Act required that the respondent pay larger amounts as income tax on behalf of each of the officials. In assessing the respondent for income and excess profits tax, the appellant, in 1943 and 1944, disallowed certain sums as "unauthorized salary increases" on the basis that the payments of the increased income taxes represented increases in the "rate of salary" of these officials contrary to section 2 of the Wartime Salaries Order, P.C. 1549, dated February 27, 1942.
It was also contended by the Minister that the resolutions were not legally binding upon the Rinfret C.J. and Rand, Kellock, Estey and Locke JJ. company because they did not conform to the constitution of the company or to the Companies Act. The Exchequer Court held that the resolutions were binding, that the payment of income tax was not a bonus and that the "rate of salary established and payable" was not increased.
Held: The resolutions were valid and binding upon the parties. (Barron v. Potter [19141 1 Ch. 895; Foster v. Foster [19161 1 Ch. 532 and Worcester Corsetry Ltd v. Witting [1936] 1 Ch. 640 followed. Kelly v. Electrical Construction Co. [19071 10 O.W.R. 704; Colonial Ass. Co. v. Smith [19121 22 Man. R. 441; Automatic Self Cleansing Filter Syndicate Co. Ltd. v. Cunninghame [19061 2 Ch. 34 and Salmon v. Quin [19091 1 Ch. 311 distinguished).
Held (Kellock and Estey JJ. dissenting): The rate of salary was not increased by maintaining the mode of determining it. (Judgment of the Exchequer Court [19471 Ex. C.R. 458 affirmed).
Per The Chief Justice, Rand and Locke JJ.:-The "rate of salary" in this case was that determined by a mathematical computation in which one of the factors was the variable scale of income tax rates; the words "rate of salary" are to be interpreted as meaning -the salary arrangement and not the quantum of the salary.
Per Kellock and Estey JJ. .(dissenting) :-The salary rate "established and payable" was the amount per annum which the respondent was paying the employee, and therefore the payment of additional amounts by reason of an increase in income tax rates over and above the rate existing on November 6, 1941, falls within the prohibition of sec. 2 (a) of the Order.
On the question as to whether the payment of income tax could be regarded as a bonus within the meaning of sec. 2 (d) of the Order, The Chief Justice, Rand and Kellock JJ. expressed no 'opinion while Estey and Locke JJ. held that it was not a bonus. Even assuming that it was a bonus, The Chief Justice and Rand J. 'held that it would fall within the exception of sec. 2 (d) (i) (Kellock and Estey JJ. Contra).
APPEAL from the judgment of the Exchequer Court of Canada, O'Connor J. (1), maintaining an appeal from the decision of the Minister 'of National Revenue confirming respondent's assessment levied upon him for the taxation years 1943 and 1944 under the provisions of The Income War Tax Act and The Excess Profits Tax Act. The material facts of the case and the questions at issue are stated in the above head-note and in 'the judgments now reported.
W. R. Jackett and E. S. MacLatchy for the appellant. G. H. Steer K.C. for the respondent.
(1) 119471 Ex. C.R. 458.
J.-This appeal raises the question whether a "salary free from income tax" when it amounts to more than that actually received in the basic year is contrary to the provisions of the Wartime Salaries Order P.C. 1549. The preamble to the Order recites its purpose of "stabilizing the rates of managerial and executive salaries paid during wartime in the same general way as wage rates are stabilized under the Wartime Wages and Cost of Living Bonus Order."
'Clause 1 (c) defines "salary" to include "wages, salaries, bonuses, gratuities, emoluments or other remuneration, including -any share of profits or bonuses dependent upon the profits of the employer .
.
."
Under a proviso, a salesman's commission is not deemed to be a salary. Clause 2 (a) forbids an employer to "increase the rate of salary paid to a salaried official -above the most recent salary rate established and payable prior to November 7, 1941 . . ." Paragraph (d) forbids him to "pay as bonus (which . . . shall include gratuities and shares of profits, but . . . not . . . cost of living bonus) a larger total amount to any one salaried official during any year following November 6, 1941, than the total amount paid to the said salaried official as bonus in the base year; provided that, at Some question was raised 'as to the sufficiency of the resolution passed by the shareholders authorizing salary for officials who were also directors, but I think it was clearly shown on the argument that there was no substance in the point.
What the Order does is not to fix the quantum of remuneration but in contradistinction to fix -the rates at which the remuneration is paid, an effect which the language of clause 2 (a) "the rate of salary paid" seems to me to place beyond doubt. I cannot imagine why the words "rate of" should have been added to -the word "salary" if they were not intended to be significant. In the fluctuating bonus under clause 2 (d), increases in the actual amount are expressly contemplated; and considering the operation in 1942 and subsequent years of a bonus based upon a percentage of profits, sales, or output, any doubt as to the underlying intention disappears.
That the rate of salary in this case was that determined by a mathematical computation in which one of the factors was the variable scale of income tax rates is perfectly clear. The official, in reporting his income, must have shown such a sum as with the tax referable to it deducted would leave a balance of $15,000.
The salary is thus fluctuating, but if the -amount received in 1941 is taken as the rate, an entirely new form is given to it. The words of the Order must be taken to envisage different salary bases, and that here is not of an unusual nature. A specific sum related indefinitely to a unit of time is itself the rate for that period and is ordinarily referred to as the salary; but an increase in such a rate is to be distinguished from an increase -or decrease in amount when the latter is the function of a variable; in that case the rate cannot be expressed otherwise than in terms of a mathematical relation.
It was contended that that portion of the salary representing the tax was a bonus within clause 2(d). Even assuming this to be so, I would agree with Mr. Steer that it is within the first proviso. It would be a bonus "in fixed ratio to" the salary. These mathematical expressions in the proviso must be interpreted in the context and scheme of the Order, and I see no difference in the intention between a fixed percentage, say, related to a variable quantity and a variable factor applied to a fixed quantity. In each case there is a fixed ratio within the language used. I am, therefore, of opinion that the rate of salary has not been increased by maintaining the mode determining it and that the appeal must be dismissed with costs.
J. (dissenting) :-The question for decision on this appeal turns upon the meaning of the words "rate of salary" in paragraph 2(a) of P.C. 1549 of the 27th of February, 1942.
By paragraph 2 of the Order here in question an employer, unless otherwise permitted by paragraphs 3, 4 afte Novmber7,
141, and 5, is prohibited on or after November 7, 1941, from increasing "the rate of salary paid to a salaried official above the most recent salary rate established and payable prior to November 7, 1941
It is contended on behalf of the respondent that the "rate of salary" in the case of a managing director, to take the case of one employee as an example, was on the 6th day of November, 1941, $15,000 per year, plus income tax, and that although the tax has been increased by reason of legislation since that time, the rate of salary has remained the same and payment by the respondent of the net sum of $15,000 has involved no increase in the rate within the meaning of the Order. On the other hand, it is contended on behalf of the appellant that the rate of salary "established and payable" on the relevant date was the yearly sum actually being paid by the respondent to the employee inclusive of income tax during the relevant year.
The Order by paragraph 1 (c) expressly provides that "salary" shall include "payments to persons other than the employee in respect of services rendered by the employee" so that "salary" within the meaning of the Order includes any amount paid in respect of the employee's income tax.
In its recital the Order refers to the earlier Order replaced by P.C. 1549 and the fact that the earlier Order was made for the purpose of stabilizing the "rates" of managerial and executive salaries paid during wartime in the same general way as wage rates are stabilized under the Wartime Wages and Cost of Living Bonus Order, and permitting the payment of a specified cost of living bonus to salaried officials earning less than $3,000 per year.
It is further recited that it has been found that the earlier Order bears more severely than intended upon industries engaged in war production which, by reason of the fact that many of them were in the process of organization or expansion during the period before the earlier Order came into effect had not had sufficient opportunity to "adjust the salaries" of -their officials and the Minister of Munitions and Supply was of opinion that there would be serious interference with such industries if some provision was not made for "adjustments in salaries."
It is also recited that it is desirable to permit, under certain circumstances, the "adjustment of the salary rate" payable to a salaried official, appointed or promoted after - January 1, 1941.
So far as the recital is concerned there would appear therefore to be no distinction drawn so far as the object of 'the Order is concerned between "adjustment of salaries" and "adjustment of the salary rate" or the "rate of salary." In my opinion the most recent "salary rate established and payable" prior to November 7, 1941, in paragraph 2 (a) means the amount per month or per year the official is actually receiving at that time.
Under the contract referred to above the respondent had agreed to pay the employee a "salary of fifteen thousand ($15,000) dollars per year as from January 1, 1941, free from income tax." In my opinion the meaning of this contract was an agreement to pay a salary at the rate of $15,000 per year with a covenant to indemnify the employee against income tax not only at the existing rates but at any rate which might be authorized by Parliament during the term of the contract. The salary rate "established and payable" was, however, the amount per annum which the respondent was then actually paying -the employee, namely, $15,000 plus the tax at the then existing rate. An examination -of other provisions of the order, in my opinion, bears out this view. By paragraph 1(b) "salaried official" includes every employee above -the rank of foreman or comparable rank and -for the purpose of the order any employee "receiving" salary or wages (excluding cost -of living bonus) at a rate of less than $175 per month, is to be deemed not above the rank of foreman or comparable rank.
If the employee under the contract referred to ;above were entitled say, to $1,200 per year, free from income tax, instead of, as the fact is to $15,000, then, in order to determine whether or not he came within the definition, assuming the existence of no guide to determine the question other than the amount of remuneration, if the actual salary of $1,200, together with -the income tax at the then existing rate amounted together to less than $2,100, the provisions of paragraph 2(a) would not, in my opinion, apply to that employee at all as the prohibition of -that paragraph refers only to payments to "salaried officials". It seems clear, therefore, that -the amount of the salary actually being paid on November 6, 1941, is what is dealt with in paragraph 2(a).
"Salary" is really meaningless without reference to some period of time with respect to which it is payable. In my opinion "salary" involves in Iellock J. its very nature not only the idea of amount but also the period with respect to which the amount has reference, in other words, rate, and when paragraph 2(a) speaks of a rate of salary "established and payable" prior to November 7, 1941, it means the same thing as is dealt with by paragraph 3(d), namely: "salary level .
.
. established at November 6, 1941," and the same thing as the "level of salaries paid" in paragraph 3(a).
Had the official above referred to been granted an increase in "salary rate" under paragraph 3(a), then, by reason of clause (d) of that paragraph the increase in
"salary" would have resulted in a new salary "level" as if it had been "established" at November 6, 1941. In my view this clause would, in such case, operate to prevent thereafter the official here in question from receiving in amount -anything more than the amount he was receiving at the time of the increase, plus the increase itself. Any subsequent increase in income tax would therefore clearly fall upon the employee and the employer would be prohibited from paying it.
If that be so, the same applies to the "salary level" actually being received by -the employee on November 6, 1941.
Again, by paragraph 4, provision is made for payment of a cost -of living bonus in certain cases and it is provided by clause (b) of that paragraph that if the salary rate
"payable" to a salaried official on November 6, 1941, included -a cost of living bonus determined in a certain manner -an additional amount of bonus may be paid and
"the total salary, including such -added amount of bonus shall be regarded for the purposes of this Order as the rate of salary in effect at November 6, 1941."
While the provisions of this clause apply to a specific case it expressly proceeds upon the same view of the Order as that already referred to in dealing with paragraph 3, namely, that the "salary rate established and payable" prior to November 7, 1941, is the amount per annum, or moto per month or per week, or whatever the period may be, actually being paid by the employer and received by the employee.
In my view therefore the payment by the respondent Co.LTD.by rsodn of additional amounts by reason of an increase in income J. tax rates over and above the rate existing on November 6, 1941, falls within the prohibition of the Order. I think that the words "no employer shall on or after November 7, 1941, increase" the rate means no employer shall "pay more than."
If the tax could be regarded as "bonus" within the meaning of paragraph 2(d), that clause prohibits payment of a. larger amount of bonus -than that paid to the same official in the base year, provided that where the bonus is covered by a contract evidenced in writing, in existence on November 6, 1941, the right to such bonus is preserved where it is defined as a "fixed" percentage of, or in a "fixed" ratio to the salary. In my opinion the "fixed percentage" and the "fixed ratio" are complementary and a tax in the later year which is 33- per cent of $15,000 (the net amount actually received by the employee) is not in fixed ratio to a tax of 20 per cent of the same amount. Neither is the tax a fixed percentage of the salary but rather a percentage which fluctuates.
There is no difficulty created by the existence of a contract made prior to November 6, 1941, in view of the provisions of paragraph 9 of the Order.
In my opinion the appeal succeeds and should be allowed with costs here and below.
J. (dissenting) :-At a general meeting of the shareholders of the respondent on June 2, 1941, resolutions were passed directing that its general manager and four of its officials as of January 1, 1941, should be paid certain specified amounts as salary "free from income tax." These resolutions remained unchanged at all times material hereto, but changes in the Income War Tax Act required that the respondent pay larger amounts as income tax on behalf of each of the officials.
This practice of paying the income taxes of certain of its officials had existed for many years prior to the outbreak of war, respondent's method being to deduct the salary, as that term is used in the above-mentioned resolutions, plus the amount paid on account of its officials' income taxes, as expenses in computing its profits. The amounts (hereinafter set out) paid for the years here in question were so treated and were included in the tax returns as filed under the item "Salaries including Plant 'and Sales Supervision."
EsteyJ. In assessing the respondent for income and excess profits tax the taxing authorities in 1943 disallowed the sum of $30,791.97 as "unauthorized salary increases," and on the same basis in 1944 the sum of $26,868.34.
These disallowances were. made on the basis that the payments of the increased income taxes represented increases in "the rate of Salary" of these officials contrary to the provisions of Wartime Salaries Order P.C. 1549, dated February 27, 1942. The decision to disallow these amounts was reversed in the Exchequer Court (1) and the Minister of National Revenue appeals from the judgment of that Court. No question is raised as to -the computation of the amounts nor the fact that they were paid consequent upon increases in the income tax.
P.C. 1549 consolidates and amends the Wartime Salaries Order P.C. 9298, dated November 27, 1941.
It recites that P.C. 9298 was "for the purpose of stabilizing -the rates of managerial and executive salaries paid during wartime that this Order "bears with special and unintended severity upon industries engaged in the production, repairing and servicing of war supplies," and that "serious interference with and loss of production in war industries may result if some provision is not made whereby adjustments in salaries can be made in proper cases," and that it is desirable that the adjustment of salaries in certain cases should be made. These recitals clearly evidence that this Order P.C. 1549 was passed with the purpose and intent of stabilizing managerial and executive salaries but to provide for such adjustments as may be necessary to assist war production.
This Order P.C. 1549 provides in para. 7:
The shareholders' resolutions embodied the respondent's obligations as employer to remunerate or pay these officials. Each of the latter was entitled both to the salary, as that term was used in the resolutions, and to the payment of his income tax as consideration for his services to the respondent.
The latter, in paying the income tax, -discharged a liability to each of the officials and thereby provided to them a benefit or gain just as effectively as if they had received that added amount from the respondent and used it in payment of 'their respective income taxes. The term "salary" is defined in P.C. 1549 as follows: The word "emolument"
is defined in the
Oxford Dictionary:
Webster's Dictionary includes the word "compensation." The payment of the income tax was either a gain or a part of the remuneration realized by these officials arising out of their employment. It would seem to follow that the scope 'and meaning of 'the phrase "emoluments or other remuneration" is sufficiently wide and comprehensive to include the payment of the officials' income taxes by the respondent to -the Receiver General of Canada within the definition of "salary" in para. 1(c) of P.C. 1549. Moreover, this definition contemplates just such a payment as here made on behalf of the officials to the Receiver General of Canada.
Then para. 2(a) of P.C. 1549 provides:
were established and payable prior to November 7 because the said salaried official was not employed by the employer prior to the said date, increase the rate of salary above the rate of salary first payable to the said salaried official.
A cost of living bonus established and payable prior to November 7, 1941, shall be regarded as part of the rate of salary established and -payable to a salaried official prior to the said date, and as such may continue to be paid at the same rate, but may not subsequently be increased by reason of any increase in the cost of living index unless permitted by paragraph 4 hereof. Estey J. The foregoing provision "no employer shall, on or after November 7, 1941, increase the rate of 'salary paid to a salaried -official" is imperative.
Thereafter an employer must not increase -the rate of the employee's salary whether that increase be called for under the terms of an existing contract or 'however it may be provided for. This view is in accord with para. 9 under which the employer is protected against the enforcement of "an increase in the rate of salary" where such is provided for in an 'agreemnt. Para. 9 reads as follows:
9. No agreement providing for an increase in 'the rate of salary above the rate payable at November 6, 1941, shall be enforceable in respect of such increase except and to the extent that such increase is within the amount that may be permitted by paragraphs 3 or 4 hereof, and no action shall lie against any person for breach of contract for complying with the provisions of this Order or for refusing to pay any salary in excess 'of the amount permitted by this Order.
The issue largely turns upon the meaning of the phrase "rate of salary" where it precedes the word "paid" in para. 2(a). In the second paragraph of 2(a) it is provided that a cost of living bonus established prior to November 7, 1941, shall be regarded as part of 'the rate of salary. This in itself indicates that it is the total salary paid in the year or 'other period prior to November 7th that is expressed in terms of a rate of salary paid that is stabilized by this Order.
Paragraphs 3, 4 and 5 provide for adjustments 'as exceptions to the general prohibition in para. 2. In para. 3(a) in respect to promotions and new appointments the Minister -of National Revenue may approve certain increases in the rate of salary, subject to a proviso "that the total salary including the increase is not higher than -the level of -salaries paid to salaried officials for similar services in like businesses."
In 3(b) the Minister may "authorize 'a temporary increase in salary and subsequently one further increase, . . . provided that the increased rate of salary ultimately payable shall not be higher than the limit mentioned in 2(b).
In that paragraph 2(b) the limit is expressed "no employer shall . . . pay . . . a rate salary higher than the rate previously paid. .
In para. 3(c) the phrase "rate of salary" is used throughout. Then in 3(d) is provided:
The new salary level referred to in para. 3(d) is the rate of -salary prior to November 7, 1941, plus the increase "in the rate of salary" under 3(a), or the ".temporary increase in salary" and one further increase if there be one under 3(b), or in the "rate of salary" under 3(c). The new salary level is the amount of the actual salary or salaries paid, including -the foregoing increases, -and thereafter the provisions of this Order apply as if these increases, though only payable from the "effective date," had been established at November 6, 1941, and therefore the prohibition in para. 2 would thereafter apply. It seems to follow that with every increase in the amount paid 'a new rate of salary is established. In every case it is the amount of salary paid to the officials which is expressed in terms of a rate. Then para. 4 provides that in certain cases, without the approval of the Minister of National Revenue, an employer may pay -a cost of living bonus, subject to the limitations included in that paragraph.
In 4(b) it is provided that "if -the salary rate payable to a salaried official on November included a cost of living bonus . . . there may be added to such bonus -an amount based . . . on the rise in the index number for October 1, 1941 . . . and the total salary including such added -amount of bonus shall be regarded, for the purposes of this Order, as the rate of salary in effect at November 6, 1941."
The language in this paragraph 'appears to express even more clearly than in para. 3 that the new rate of salary is the salary paid prior to November 6, 1941, plus -additions permitted thereafter, or the total of these, expressed in terms of a rate. It should be noted in this connection that the phrase "total salary" appears also in para. 3(a). In para. 5(a) the Minister of National Revenue may approve of an increase "in the rate of salary paid," and then in 5(b) "no payment of an increase in salary pursuant to the provisions of this paragraph . . . until notification has been received by the employer that an increase in salary has been approved and the amount thereof." It is significant in this paragraph that the only approval provided for is that of an increase "in the rate of salary paid," J. .and yet in para. (b) it is "an increase in salary" which has been approved and the amount thereof.
In the foregoing summary such phrases as "total salary" and "new salary level" are expressions synonymous with the phrase the amount of salary. Then in para. 5 the phrase "increase in salary" is synonymous with -an increase in the "rate of salary."
Moreover, in para. 6 it is provided that "any employer .
.
. who pays or contracts to pay a salaried official a salary in violation 'of any provision of this Order The phrase "rate of salary" is not mentioned in this para. 6 and yet it is the increase in the rate of salary that is prohibited in 2(a). It must follow that the word "salary" as used in this paragraph means the rate of salary.
It would be present to the minds 'of those passing this Order for general application throughout Canada that the salaries paid and subject thereto would be expressed in many ways. In order that there might be a common basis for comparison, it was provided that however expressed as between the employer and the salaried official, the total salary paid should, for the purposes of this Order, be expressed in terms of a rate. It is that salary so expressed that is stabilized. It is the total salary paid subsequent to the 6th of November, 1941, and expressed in terms of a rate that is compared with 'the total salary so expressed and paid prior thereto.
The salary contracts as evidenced by the above-mentioned resolutions were not expressed in terms of a rate. It cannot be doubted but that the parties in effecting such an agreement in 1941, under the circumstances of war, would have in mind the possibility of changes in the income tax. Under this Order it is the total of the two sums (that paid and styled as salary and that paid as income tax) that constitutes the rate of salary paid, and it is that rate which is stabilized. If the total of these two sums in subsequent years is increased then within the meaning of this Order the rate of salary paid is increased.
In fact this Order by its express terms is only concerned with the contractual relations between the parties in order to ascertain the total paid as salary in the period prior to November 7, 1941, and in so far as its provisions for future increases may be contrary to this Order.
The position of the appellant is identical with an employer who agreed on January 1, 1941, to pay his manager a fixed amount as salary and an annual increase to be determined in each year. Under this Order as each increase was paid a new rate of salary would be established. A perusal of the terms of this Order, and particularly -the use of the words "paid" and "payable" in para. (a) and 9, indicates that it is the actual amount paid as salary prior to November 7, 1941, expressed in terms of a rate that is, stabilized.
The foregoing construction of the above-quoted para.. 2(a) not only appears to give to the words their literal meaning but is consonant with the express purpose of the Order. Reigate Rural Dist. Council v. Sutton Dist. Water Co. (1); Re George Edwin Gray (2).
In McBratney v. McBratney (3), Duff, J., (later Chief Justice), after referring to the language in a statute, continued:
Moreover, it would seem that under the terms of sec. 9 these officials could only enforce payment of their salaries up to the amount computed on the basis of the rate of their respective salaries as it obtained prior to November 7, 1941. The total salary paid to each official expressed in the terms of a rate of salary paid per year in each of the years here in question was greater than the rate paid in the basic period and therefore contrary to the provisions of Mm'aOr para. 2(a). The increases were, as a consequence, properly RNuse disallowed by the Minister under para. 7, supra.
I am in agreement with the learned trial Judge (1) that the payments here made to the Receiver General of Canada were not by way of a bonus. The word "bonus" may have many meanings and as used in statutes has been variously defined.
See Ward v. City of Edmonton (2); Colonial Investment Co. v. Borland (3), affirmed 6 D.L.R. 211. It is not defined in Order P.C. 1549, but as used it does not appear to have any other than its usual and ordinary dictionary significance.
There it imports an extra or additional payment by way of an inducement or reward for some undertaking or effort.
The contract here provides for the payment of the income tax without regard to the success or achievements of the business as a whole, or to the efforts or attainments of the individual official.
It is a contractual salary obligation on the part of the respondent payable in any event -and irrespective of whether the business realized a profit or attained any particular objective in a given year. If, however, the payment to the Receiver General of Canada could be regarded as -a bonus within the meaning of Order P.C. 1549, then it is specifically prohibited by para. 2(d) and it does not come within any of the exceptions of para. 2(d) (i), 2(d) (ii) or 2(d) (iii).
I agree that the above-mentioned resolutions relative to the payment of the officials' income taxes passed by the shareholders and acted upon by 'the respondent were valid. The appeal should be allowed with costs.
LOCKE, J.:-By paragraph (a) of section 2 of the Wartime Salaries Order, P.C. 1549, it was provided that no employer should on or after November 7, 1941 "increase the rate -of salary paid to a salaried official above the most recent salary rate established and payable prior to November 7, 1941", and paragraph 7 of that 'Order provided that the amount of any salary found by the Minister to have been paid in excess of the amounts permitted by the Order should be deemed an unreasonable and abnormal expense of the employer for the purposes of 'the Income War Tax Act and the Excess Profits Tax Act, 1940. It was on the footing that the increased amounts which became payable to Messrs. Jacox, McAulay, Sutcliffe, Shaw and Roscoe for the years 1943 and 1944, by reason of the increase in the income tax rate, contravened the provisions of section 2 that the Minister disallowed them under subsection 2 of section of the Income War Tax Act. On the appeal to the Exchequer Court (1) an order was made for the delivery of pleadings, and upon this being done an issue was raised by the Minister -as to whether the arrangements for the remuneration of these five persons said to have been authorized by the shareholders' resolution of June 2, 1941, or to have become otherwise binding upon the company were in fact legally binding upon it. I do not feel called upon to decide whether, under the wording of paragraph (a) of section 2 of the Wartime Salaries Order, it was incumbent upon the taxpayer to do more than to establish that the salary rates in question were treated both by the company and its employees as binding upon both of them and that both acted upon the assumption that they were so binding, but propose to deal with the matter on the footing that the Crown is entitled to rely upon any non-compliance with the Articles of Association of the company or of the Alberta Companies Act which might render these employment -contracts unenforceable. The respondent company was incorporated by Memorandum of Association under the Alberta Companies Act in November, 1910.
C. D. Jacox was employed by the company in the capacity 'of general manager in February, 1931, the arrangement being made with him by -the then managing director, C. A. Graham.
There was no written contract and the matter was not considered by the Board of Directors. R. W. Roscoe, the present Secretary of the company was employed on May 1, 1941, the 'arrangement being made with him by Mr. Jacox on behalf of the company, and his remuneration being agreed upon at $3,600 a year, free of income tax, without the intervention of the directors. Mr. Graham had died in December, 1940, and the position of managing director had not been filled at the time of the employment of Roscoe. W. A. McAulay was employed by the company as sales manager and had originally been employed by Graham when the latter was managing director. W. B. Shaw was the factory superintendent and F. B. Sutcliffe was the secretary-treasurer of the company but the evidence is silent as to -the manner in which -they were engaged.
Different considerations apply in determining the position of Jacox who became the managing director in 1941 and those of the remaining four employees. Dealing first J. with the case of Jacox:
Article 103 of the Articles of Association provided that the directors might from time to time appoint one of their body as managing director, and article 105 that the remuneration of the managing director "shall from time to time be fixed by the directors and may be by way of salary or commission or participation in profits or by way of all of these modes."
On May 10, 1941, Sutcliffe as secretary sent out notices calling the annual general meeting of the ordinary shareholders for the 2nd of June, the purposes of the meeting being stated to be to receive the report of the auditors for the year ending December 31, 1940, and to elect the directors and auditors of the company for -the ensuing year. On May 23rd a further notice was sent by the secretary to the shareholders, giving notice that further business would be proposed, namely, to -appoint Jacox managing director of the company at a salary of $15,000 per year, free from income tax, to be effective as from January 1, 1941, and to provide that the salaries of McAulay, Sutcliffe, Shaw and Roscoe as then in effect be free of income tax and subject to adjustment from time to time at the discretion of the managing director effective as from the same date. No explanation was given in the evidence as to the reason for asking the shareholders either to appoint the managing director or to fix his remuneration.
As to the other four, however, Jacox said that while he could have made the new arrangements with them on behalf of the company he thought that since they were changing the basis of pay it was a reasonable thing to have the matter determined by the shareholders, and it may perhaps be assumed that it was for the same reason that the new arrangement to he made with him was submitted to them. All of the shareholders other than Northwest Securities Corporation Ltd. were present at the meeting either in person or by proxy: in the case of that company McAulay, the Vice-President, was apparently authorized to act on its behalf and represented it and the resolutions were unanimously adopted. Jacox, McAulay, Sutcliffe and Shaw had been directors for the past year and were all re-elected.
At a meeting of the newly elected board held later on the same day Mr. -ID Jacox was elected President and appointed Managing J. Director and Messrs. McAulay and Sutcliffe were reelected as Vice-President and Secretary respectively. -The minutes are silent -as to the remuneration of Jacox and of the other four officials. The respondent company acted upon the authority of the resolutions and paid Jacox and the others on the basis authorized, a procedure which was apparently considered by the directors at a meeting held on September 24, 1941, when a statement giving detailed records of the operations of the company for the eight months ending August 1941 was read and discussed and apparently approved. The evidence is very meagre as to what took place at this meeting which may be accounted for by the fact that Mr. Sutcliffe, the Secretary, had died some time before the trial but apparently all the figures showing the expenses of operation were available to the directors and these would show that monthly instalments of income tax were being paid on behalf of Jacox and the others in the manner authorized.
On March 2, 1942, at a further meeting of the directors the auditor's statement which showed expenditures for salaries, including, without detailing them, the amounts paid for income tax on behalf of Jacox and the others, was approved by the Board and it was made clear from the evidence of Mr. Evans, one of the two directors appointed to represent the preferred shareholders, that all of the directors were aware of and approved the arrangements which the shareholders had purported to authorize in the previous June.
The Companies Act of Alberta does not deal with the question as to whether contracts of this nature are to be made or authorized by the directors or by the shareholders, so that the principles upon which such cases as Kelly v. Electrical Construction Company (1) and Colonial Assurance Company v. Smith (2) were decided are inapplicable. Nor is this a case where there is a conflict as to the respective rights of the shareholders and the directors to deal with the matter, such as in Automatic Self Cleansing Filter Syndicate Co. Ltd. v. Cuninghame (1) and Salmon v. Quin (2). Here I think it is a proper inference from the evidence that the directors were unwilling to exercise the authority given to them and that it was -at their request that the matter was submitted to and dealt with by the shareholders and I think the resolutions so passed were binding upon the company. Barron v. Potter (3); Foster v. Foster (4); Worcester Corsetry Ltd. v. Witting (5), Lawrence, L.J. at 631, 652. Article 105 authorizing the directors to fix the remuneration of the managing director does not require them to deal with the matter by resolution, or to contract in the company's name in any particular form. While the company was, in my opinion, obligated by the passing of the resolution, if there were doubt as to this the.arrangement authorized should be taken to have been ratified and confirmed by the directors at their meetings of September 24, 1941, and March 2, 1942, and having been acted on by both parties bound both of them.
Different considerations apply in the case of McAulay, Sutcliffe. Shaw and Roscoe.
Article 123 provided that without prejudice -to the general powers conferred upon the directors to manage the business of the company they might appoint such managers, secretaries, officers, clerks, agents and servants as they consider necessary for the conduct of the company's affairs and fix their salaries. Jacox said that he had the power to employ these men and fix their remuneration without reference to the Board and it was clear that in the case of Roscoe he did 'so. The action of Graham in employing Jacox as general manager in 1931 and Shaw at a later date, without the intervention of the Board, indicates, in my opinion, that the officer managing the company's business was entrusted by the Board with the power to employ and fix the remuneration of other employees of the company. Since McAulay, Sutcliffe and Shaw were directors, apparently Mr. Jacox considered it proper to obtain the authority of the shareholders and, as in the case of his own arrangement, this was done with the authority and approval of the directors. The arrangement so authorized was acted upon by these employees and by the company and the directors at the meetings referred to, approved and ratified the arrangements.
I have no doubt that upon -these facts the respondent company became liable to pay the salaries agreed upon and such additional amount as these individuals might be required to pay as income tax under the arrangement.
The prohibition in paragraph (a) of section 2 of the Wartime Salaries Order is against increasing -the rate of salary paid to a salaried official.
The arrangements in question here were made prior to November -7, 1941, and made effective as from January 1st of that year. arrangement in the case of each of -the five officials was that they should be paid fixed amounts free of income tax. The amount to be paid each under -this arrangement was materially increased by amendments to the Income War Tax Act made after the year 1941 increasing rates of taxation upon individual incomes.
It is contended on behalf of the Minister that the expression "rate of salary" should be interpreted as meaning the amount of the salary. I think that this is not the meaning to be assigned to the expression. In my opinion the words "rate of salary" are to be interpreted as meaning the salary arrangement. think whether the employment contract provided remuneration at the rate, say, of $1,000 a year or $1,000 and 500 bushels of wheat or $1,000 plus an amount sufficient to pay the employees' income tax, each arrangement would be described in ordinary language as the rate of salary. I think further that if the arrangement was for a payment partly in cash and partly in kind such as $1,000 in cash and 500 bushels of wheat, an increase in the market value of wheat in subsequent years would not be an increase in the salary rate, and that if the contract required the employer to also pay an amount sufficient to pay the employees' income tax the rate is not changed if Parliament in later years increases the amount of the taxation. I think it is significant that in paragraph (d) of section 2 of the Order the prohibition is against paying a "larger total amount" as bonus during any year following November 6, 1941, than the total amount paid as bonus in the base year, with certain exceptions.
Had it been intended to prohibit an increase in the amount of salary rather than to prohibit a change in the salary arrangement paragraph (a) would have been so worded.
It was further contended that the agreement to pay the amount of the income tax was a bonus within paragraph
(d) of the Order.
That paragraph says that the word
"bonus" for the purpose of the subparagraph shall include gratuities and shares of profits and the arrangement in question is neither one nor the other. It cannot be said that an amount payable to an employee pursuant to the terms of a contract is a gratuity.
The appeal should be dismissed with costs.
Appeal dismissed with costs.
Solicitor for the appellant:
W. S. Fisher.
Solicitors for the respondent:
Milner, Steer, Dyde,
Poirier, Martland & Layton.
APPEAL-Motor vehicle - Collision-Intersection of public highways- Right of way-Liability-Duties of both drivers-Joint negligence-Quebec Motor
Vehicles Act, R.S.Q. 1941, c. 142, s. 86, ss.
7-Notice of appeal-Continuance of suits- Joint and several obligations-Payment by one of the joint and several debtors-Subrogation-Intervention-Arts. 1117, 1118, 1156
C.C.-Arts. 269, 271, 273 C.C.P.-Supreme
Court Rule 60.......................
ASSESSMENT AND TAXATION.
AUTOMOBILE-Insurance - Automobile
-Liability for damages caused by a truck to a pedestrian-Delay in giving notice-Reasonable excuse-Impossibility of giving notice- Acceptance of notice without prejudice- Investigation of facts-Waiver of failure to comply with conditions of the policy-Art.
2478 C.C...........................
BANKRUPTCY-Trustee - Sale of assets by trustee to one inspector-Securities pledged by purchaser-Money advances made by trustee-Bankruptcy Act, R.S.C. 1927, c.
s. 48 103 (6)-Arts. 14, 1484 C.C.-The respondent was the president of
"La
Soci6t6 G6ndrale des Ponts et Chauss6es
Limitie", which went into bankruptcy in
The appellant, as trustee, sold the assets of the bankruptcy situated in
Jamaica to respondent who was at the time one of the inspectors. The trustee had a general authorization from the inspectors, approved by the Court, to dispose of the assets in Jamaica as he might deem proper.
Respondent pledged as security for the payment of the purchase price and for money advances made by the trustee, securities of which some "Rentes Frangaises", valued at
$22,076.91.
Respondent having met with financial difficulties in Jamaica, the assets were liquidated and the operations came to an end.
Respondent, then, instituted legal proceedings in which he asked that the agreement of sale be declared null and void and that appellant be condemned to remit the securities pledged.
The Superior Court held the agreement null but refused to grant the other conclusions of the action.
Both parties appealed and the Court of Appeal held the agreement to be null and void and also that present respondent was entitled to the securities pledged.
Held: As the trustee did not have the permission to do the particular thing which has been done and as the respondent-inspector did not have the prior approval of the Court to purchase (s. 43 and 103 (6) of the Bank- 26682-21
BANKRUPTCY-Concluded ruptcy Act), the agreement of sale is therefore null and void. Art. 1484 of the Civil Code does not apply to the present case. Appellant must remit the value of the securities pledged after deducting the amount of the advances made, but he cannot be held personally liable as he has acted only in his capacity of trustee. Ross BANKS AND BANKING-Crown - War Loan Bonds-Registered as to principal only-Alleged transfer by owner-Signature of registered owner guaranteed by bank- Owner denying having executed transfer- Liability of the Crown-Liability of the bank -As to the principal-As to the interest or coupons............................ See CRown 1.
CIVIL CODE-Article 14 (Interpretation) .......... 2.- Articles 443, 449, 486 (Usufruct) 183 3.-Articles 851, 855 (Wills in form derived from the laws of England) ...... 4.- Article 981a (Trusts) .......... 5.-Articles 1117, 1118 (Joint and several obligations)...................... 6.- Article 1156 (Payment with subrogation)............................ 7.-Article 1484 (Capacity to buy or sell) ....... 8.-Articles 1787, 1788, 1901, 1902 (Life rents).........................
9.- Article 2478 (Insurance) ....... 278 CODE OF CIVIL PROCEDURE-Articles 269, 271, 278 (Continuance of suits)... COMPANY-Assessment Act, Statutes Nova
Scotia, 1988, c. 2-Assessment of companies
-No incompatibility between s. 10 and s. 28
-S. 28 not an exclusive code for assessment of companies-Company a person under s. 10 and neglect of company to comply with demand under s. 10 entails penalty under s. 15 of loss of right of appeal-N.S.
Assessment Act, 1938, c. 2, as. 2, 10, 12, 18,
15, 28-80 and 38..................
CONSTITUTIONAL
LAW - Minimum
Wages - Legislative Jurisdiction - Provincial Statute-Postal Service-Employee of a Revenue Post Office-Temporarily Engaged
Postmistress-Whether Employment Subject to Provincial Minimum Wage Act- Post Office Act R.S.C. 1927, c. 161-Civil
Service Act, R.S.C. 1927, c. 22-Minimum
Wage Act, Sask., R.S.S. 1940, c. 810-British North America Act, SS. 91, 92.-Mrs.
Graham, postmistress of a revenue Post
Office at Maple Creek,
Saskatchewan, engaged temporarily one Leo Fleming to work in the Post Office exclusively in connection with the work of the Post Office.
The postmistress was prosecuted under the
Saskatchewan Minimum Wage Act for paying to Fleming an amount less than the minimum wages prescribed by an Order made under the Act. Her conviction for violation of the Act was affirmed by the
Court of Appeal.
As the case was not appealable to the
Supreme
Court of
Canada the Governor-in-Council referred the matter to the Court under section 55 of the Supreme Court Act. Held: The employee became employed in the business of the Post Office of Canada and therefore part of the Postal Service.
His wages were, as such, within the exclusive legislative field of the Parliament of Canada and any encroachment by provincial legislation on that subject, must be looked upon as being ultra vires, whether or not Parliament has or has not dealt with the subject by legislation. Held: It is not competent to a provincial legislature to legislate as to hours of labour and wages of Dominion
OFFICE..............
2.-Application of Hours of Work Act,
R.S.B.C., 1986, c. 122, to Employees of
C.P.R. Hotel-Whether hotel part of the
"undertakings" of a railway-Whether
"lines of" includes "railways"-Whether hotel included in the term "railways"-Whether Parliament has made a declaration as to hotels-Property and Civil Rights-Effect of
Collective Bargain and P.C. 1003 (Dom.)
10 (a) and (c)-The Railway Act, 1868,
S. of C., 1868, c. 69, ss. 5 (16), 7 (8) (10)- The Consolidated Ry. Act, 1879, 5. of C.,
1879, c. 9, 8s. 7 (8) (10) Am. 1883, c.
e. 6-Canadian Pacific Ry. Act, 1881, 5. of
C., 1881, c. 1, Schedule "A" s. 17-The
CONSTITUTIONAL LAW-Concluded Railway Act, 1888, S. of C., 1888, s. 2 (9), Am., 1892, c. 27, s. 1 (q)-Canadian Pacific Ry. Act, 1902, S. of C., 1902, c. 52; 8s. 8, 9- The Railway A ct, 1903, S. of C., c. 58, s. 2 (s) (w)-The Railway Act, R.S.C., 1906, c. 37, 8s. (15), (21), (3), (151) (c) (g)-The Railway Act, 1919, S. of C., 1919, c. 68 8s. 2 (21),
6 (c)-War Measures Act, R.S.C., 1927, c. 206-The Canadian National-Canadian Paciic Act S. of C., 1933 c. 88, s. 8 (g), as enacted by, 1947, c. s. 1-The National Emergency Transitional Powers Act, 1945, S. of C., 1945, c. 25.-An hotel is not an integral part of a railway and therefore does not fall within the meaning of the term "railways" as used in section 92 head 10 (a) of the British North America Act; nor has the Parliament of Canada made a declaration as to hotels under section 92 head 10 (c) of the An hotel therefore does not fall with the class of subjects to which in virtue of section 91 head 29 of the Act, the exclusive Legislative Authority of the Parliament of Canada extends.
(Appeal dismissed and judgment of the Court of Appeal for British Columbia affirmed.)
C.P.R. v. Attorney General of British Columbia. 373 3.- Statutory exemption from taxation- Parliamentary contract-Public statute - Severance tax-Levies-Indirect taxation- Interpretation Act, c. 2 of Consolidated Act, 1877, of B.C.-Forest Act, c. 102, R.S.B.C. 1986, s. 123, am. c. 29, Statutes of 1946- Consttutional Questions Determination Act, c. 50, R.S.B.C., 1936.-By an Act relating to the Island Railway, the Graving Dock and Railway Lands of the Province, cap. 14, Statutes of British Columbia 1884, sec. 22, it was provided that:-"The lands to be acquired by the company from the Dominion Government for the construction of the railway shall not be subject to taxation unless and until the same are used by the company for other than railroad purposes or leased, occupied, sold or alienated."
Held: answering a question submitted by the Lieutenant-Governor in Council under the provisions of The Constitutional Questions Determination Act, cap. 50 R.S.B.C. 1936, and reversing the judgment of the Court of Appeal, that the Province of British Columbia was obligated by contract to exempt from taxation the lands acquired by the Esquimalt and Nanaimo Railway
Company from the Dominion Government and remaining in its hands in the manner provided by the section.
Held: reversing the judgment of the Court of Appeal (except as to Question 4) the further questions submitted should be answered in the manner indicated in the Statement of Facts.
Co. v. GEN- CONTRACT-Illegality-Whether payment of fee for new real estate agent's licence extends date of expired licence so as to con- CONTRACT-Concluded stitute the latter a "subsisting licence" to date of such payment-Whether statutory prohibitions apply to period between date of expiration of old licence and date of issue of new licence and render real estate agent's claim for remuneration illegal-The Real
Estate Agents' Licensing Act, R.S.A. 1942, chapter 818, ss. 2 (d), 4 (1), 7, 14 and 15.- In the latter part of July or early August
1943, the respondent inquired of the appellant's managing director if the appellant wished to sell a certain property it owned in Edmonton. Following this conversation respondent sought to interest the local manager of D'Allaird's Ltd. in the purchase and was referred to its Montreal office.
On August 24th respondent forwarded the
Montreal office particulars of the property and the purchase price.
On August 26 he renewed his real estate agent's licence, which pursuant to The Real Estate Agents'
Licensing Act, R.S.A. 1942, ch. 318, see. 7, had expired on June 30.
On Sept 2 the
Montreal office wrote.its local manager to advise respondent it might be interested in making an offer and to secure further information from him. These instructions having been complied with, D'Allaird's
Ltd. then wrote the appellant it had been in communication with the respondent with regard to its Edmonton property and thereupon entered into direct negotiations with appellant, and completed purchase of the property in Oct. 1943.
respondent held himself out as a real estate agent and accepted employment as such in the face of the statutory prohibition.
He relied upon a contract to render services which he was prohibited by law from undertaking.
The contract was therefore illegal and the assistance of the court will not be given to enforce it. (Barlett v.
Vinor, Carth. 252; Cope v. Rowlands 2 M. &
W. 149; Langton v. Hughes 1 M. & S. 593;
Holman v. Johnson 4 Cowp. 341, applied.)
Per Rand J.: In the presence of the Statute, the entire exchange between the parties up to the moment of the issue of the licence must be treated as void or non-existent.
Held: also, the licence which the respondent obtained dated August 26, 1943, did not on its face purport to be a renewal of the licence which expired on June 30, 1943, nor in any other sense to extend theterms of that licence.
It was simply a new licence effective as of its date and for the term stated. Per Rand J.: The word
"renewed" (as used in sec. 7) cannot be given a retroactive implication.
After the expiration of a licence and until another is obtained the prohibitions of the Statute apply.
CoMMERcIAL
LIFE Ass. Co. v
2.-Municipal Law-Tender for construction of water and sewerage system-Offer submItted and accepted by mun'cipal Council
-Acceptation cancelled by Council before
. .
..
. .
. .
.....
....
....
See MumcIPAL 2.
.CORROBORATION-Criminal law-Evidence of acnplice-Corroboration-Nature of evidence required for corroboration-Circumstantail evidence-Recent possesion- Remarks of trial judge in passing sentence- Cr. Code 8. 1002, 1014-Charge of retaining stolen goods under Cr. Code 5. 899 ..... See CRIMINAL LAW 2.
2.-Criminal Law - Evidence - Corroboration-Unsworn testimony of child of tender years-Offence, under section 801 (2) of Criminal Code, of carnally knowing girl between the ages of 14 and 16 years-Canada Evidence Act, section 16 (2)-Criminal Code, sections 801 (2), 1002, 1003, 1028 349 See CRIMINAL LAW 5.
CRIMINAL LAW-Conspiring to defraud -Effect of reception of inadmissible evidence-Appeal from conviction-Onus on Crown under section 1014 (2) of Criminal Code-Trial by judge alone-Trial judge's report under section 1020 qf Criminal Code- Substantial wrong and miscarriage of justice -New trial-Section 444 of Criminal Code- Department of Munitions and Supply Act, 1940 Statutes of Canada, c. 31-Interpretation Act, R.S.C. 1927, c. 1.-The three appellants were convicted on a charge of conspiring to defraud the Crown contrary to section 444 of the Criminal Code. charge was that they had entered into an unlawful agreement to evade payment of income tax.
At the trial, the Crown introduced statements made by the accused at an inquiry held under the provisions of the Department of Munitions and Supply Act, section 19 of which prohibited their disclosure as was unanimously decided by the Court of Appeal.
The majority of the Court of Appeal held that there had been no miscarriage of justice notwithstanding the improper reception of the statements. The accused appealed from this judgment. Held: reversing the judgment appealed from (1947] 2 W.W.R. 289), Kerwin J. dissenting, that the onus of the Crown to satisfy the Court that there would without doubt have been a conviction had the illegal evidence been excluded, has not been discharged.
Per Kerwin J. (dissenting)
:- The appellants had a fair trial even though the inadmissible evidence was introduced and the trial judge could not have failed to convict on the admissible evidence. Nonv. THE KING............... 2.- Evidence of accomplice-Corroboration -Nature of evidence required for corroboration-Circumstantial evidence-Recent possession-Remarks of trial Judge in passing sentence-Cr. Code s. 1002, 1014-Charge of retaining stolen goods under Cr. Code s. 899.- The Court of Appeal for Alberta affirmed the conviction of the appellant who had been found guilty by a judge, presiding without a jury, of retaining in his possession, knowing them to have been stolen, sixteen tires, the property of the Government of Canada. These tires were stolen from the R.C.A.F. in Edmonton by one L.A.C. Ward. CRIMINAL LAW-Continued
The accused agreed to sell them for Ward and they were delivered by Ward to the accused at the Low Level Service Station in
Edmonton in a truck bearing the letters
R.C.A.F. on the door. The six tires sold by the accused were recovered and all the others were recovered either at his house or at the service station.
Held: This was not a conviction on the uncorroborated evidence of an accomplice.
Held: The conduct of the accused and the circumstances under which he received and disposed of the tires established his guilt, and even if the trial judge's direction lacked that precision which the law contemplates, no substantial wrong or miscarriage of justice had occurred under section 1014 Cr. Code. Held: The remarks made by the trial judge in the course of his passing sentence, even if he had them in mind when considering his verdict, would not, in the circumstances, warrant a setting aside of the conviction.
KING
......................
3.-Accused charged of murder entitled to have all his defences adequately put to jury by trial judge-Appellant conspired with two others to hold up and rob bank, when block away turned back, were intercepted by police and appellant disarmed-Companion attempting to escape killed policeman-Whether appellant party to offence of murder within meaning
. 69 (2) Criminal Code, or had abandoned common intention to prosecute unlawful purpose-Whether such common intention was (a) attempt to rob bank; (b) to resist arrest by violence and assist each other in doing so; or (c) conspiracy to rob bank- Whether trial judge erred in charging jury appellant guilty of an attempt to rob bank within meaning of S. 72 (2) of Criminal
Code.-The appellant together with M and C, each having provided himself with a revolver and ammunition, proceeded in a motor car to hold up and rob a bank.
The police having learned of the plot had parked a police car near the bank. When the trio were a short distance from it they turned the car about, abandoned it about a mile away, and walked to some railway tracks. They were there intercepted by two policemen in plain clothes who escorted them back to a detective also in plain clothes. The latter after asking the appellant his name and receiving no reply, noticed the appellant's revolver and took it from him without resistance, objection or protest. At this moment the suspects, who were standing in line, sprang in different directions, the police giving chase.
M in his flight turned and shot his pursuer.
The police returned the fire. As a result of the shooting, C and the two policemen were killed, M and the detective, wounded.
The appellant took no part in the shooting but in his flight joined M and was subsequently arrested while biding with him.
M and the appellant were charged jointly with the murder of the policeman shot by
M, but were tried separately, and both
CRIMINAL LAW-Continued found guilty. M was executed and the present appeal is from the conviction of the appellant. Held: The appellant was entitled to have each of his defences adequately put to the jury by the trial judge and since this was not done with regard to his principal defence, that of abandonment (Kerwin J. dubitante), there should be a new trial. Per Kerwin, Estey and Locke JJ.: There was evidence upon which the jury might properly find that there had been an attempt to commit an offence within the meaning of S. 72 of the Criminal Code. Per Kerwin J.: Such offence constituted an attempt to rob the bank and in leaving the question to the jury, the trial judge did not prejudice the accused. Per Taschereau and Kellock JJ.: The question was, whether on the evidence the trio had sufficient reason for thinking they had rendered themselves liable to arrest and had determined to resist to the extent of using violence if necessary. It was open to the jury on the evidence to conclude that the appellant at the time of the shooting was a party to the prosecution of an unlawful purpose; it was also open to them to.come to a contrary conclusion, if they were of opinion that even had there been an earlier unlawful intention, it had, so far as the appellant was concerned, been abandoned. Before the appellant could be convicted it was essential that these alternatives should have been put to the jury by the trial judge from the standpoint of the Defence as well as the Crown, which was not done. Per Taschereau J.: The conspiracy to rob the bank was complete and this in itself was a crime, but the subsequent facts revealed by the evidence did not show the essential ingredients of an attempt to rob the bank within the meaning of S. 72 of the Criminal Code. An intent, an act of preparation, and an attempt, must not be confused. A mere intent is not punishable in criminal law, even if coupled with an act of preparation. Reg. v. Eagleton, Dears C.C. 515; It cannot be held that the mere fact of going to a place where the contemplated crime is to be committed, constitutes an attempt. There must be a closer relation between the victim and the author of the crime; there must be an act done which displays not only a preparation for an attempt, but a commencement of execution, a step in the commission of the actual crime itself. The trial judge erred in charging the jury that "they could be prosecuted for attempting to rob a bank" and "the attempt is complete when they take any steps in connection with it." This confused the issue and was prejudical to the accused. The question of whether the bandits were guilty of an attempt is foreign to the case. Their common unlawful purpose to hold up and rob the bank and to assist each other in the prosecution of that purpose, having been frustrated, was obviously not pursued, and it was not therefore in the prosecution of such purpose that the mur- CRIMINAL LAW-Continued der was committed.
It was for the jury to say, if in view of the evidence the appellant had been a party to a conspiracy, if such conspiracy was ever formed; and it was also within their exclusive province to find, after having been properly instructed, that he had detached himself from any further association with the other conspirators. v. . 226
4.-Incest-Brother and sister-Trial by jury-Evidence of consanguinity-Admissions by accused-Hearsay-Criminal Code section 204.-The accused was found guilty on a charge of having committed incest with his sister. At the trial, the proof of consanguinity was based mostly on two letters which the complainant said she had received from the accused, in one of which he addressed her as "Sis". and the other in which he had signed "Brot. Chris. Smith."
The Court of Appeal quashed the conviction on the ground that there was no evidence as to the relationship between the accused and the complainant. Held: A person accused of incest may admit the relationship and the jury was entitled to treat both letters as admissions against him and to say that a blood relationship was meant by the expressions used. THE
Scmur .
...............
5.-Evidence - Corroboration - Unsworn testimony of child of tender years-Offence, under section 501 (2) of Criminal Code, of carnally knowing girl between the ages of 14 and 16 years-Canada Evidence Act, section
16 (2)-Criminal Code, sections 301 (2),
1002, 1003, 1023.-Held: The corroboration required by section 301 (2) of the
Criminal Code cannot be found in the unsworn testimony of a child of tender years, unless this unsworn testimony is corroborated by some other material evidence.
6.-Theft-Goods valued at less than 825- Summary trial-Deputy Recorder-Jurisdiction-Magistrate-Cities and Towns Act of Quebec, c. 233 R.S.Q. 1941, sections 647,
648-Summary Convictions Act of Quebec, c.
25 R.S.Q. 1941, section 6-Criminal Code, section 771 (a) (i).-The appellant pleaded guilty to a charge of theft of goods valued at $19 laid under Part XVI of the Criminal
Code and was sentenced to six months imprisonment by the Deputy Recorder of the City of Westmount, Quebec. It was argued in appeal that the Deputy Recorder had exceeded his jurisdiction as he was not a magistrate within the meaning of section
771 (a) (i) of the Criminal Code. The
Court of King's Bench, appeal side, affirmed the conviction. Held: The Deputy Recorder having been clothed with the jurisdiction of two justices of the peace by the provisions of the Summary Convictions Act of Quebec, was within the definition of
"other functionary" in section 771 (a) (i).
BLAIS v. THE KING.................
CRIMINAL LAW-Concluded
7.-Possession of a firearm capable of being concealed upon the person while committing any criminal offence-Whether the words "any criminal offence", The Criminal Code, s. 122, includes any criminal offence the essential element of which is the possession of a firearm-The Criminal Code, R.S.C., 1927, c. 86, s. 122 as re-enacted by S. of C., 1938, c. 44, s. 7.-Held: (Kerwin J. dissenting)-To avoid the absurdities, inconsistencies or repugnancies which a perusal of other sections of the Code would otherwise give rise to, the words "any criminal offence" as used in s. 122 are restricted to an offence of which the possession of a firearm capable of being concealed upon the person, is not an essential element. In the result Rex v. Maskiew (1945) 53 Man. R., 281, overruled. Per Kerwin J. (dissenting)-By themselves the words "any criminal offence" do not admit of two interpretations and therefore the applicable rule is that set out in Grey v. Pearson 6 H.L Cas. 61 at 106; Victoria City v. Bishop of Vancouver Island, [1921] A.C. 384 at 387. Another principle in the construction of statutes applicable to s. 122 is: "If the words of an Act are clear, you must follow them, even though they lead to a manifest absurdity"-Reg. v. Judge of City of London Court, (1892) 1 Q.B. 273, 290; Cook v. Charles A. Vogaler Co., [1901] A.C., 102, 107. The remedy lies with Parliament and not with the Courts-Canadian Performing Right Society v. Famous Players Canadian Corp. [1929] A.C. 456 at 460. v. CROWN-War Loan Bonds-Registered as to principal only-Alleged transfer by owner-Signature of registered owner guaranteed by bank-Owner denying having executed transfer-Liability of the Crown- Liability of the bank-As to the principal- As to the interest or coupons.-The respondent sought to recover the principal and the interest of nine $100 bonds of the Dominion of Canada which were registered as to principal in her name.
These bonds, maturing in 1937, were purchased in 1917 and were left in custody of a friend, Father Cotter. In November,
1921, in consequence of a form of transfer purporting to have been signed by the respondent, witnessed by Father Cotter and guaranteed by the Royal Bank of Canada, the bonds were made payable to bearer. The respondent alleged that her name appearing on the transfer was a forgery. Judgment was given in the respondent's favour for the sum of $900 with interest at 51 per cent per annum from November, 1921, to the date of maturity in 1937. Held, varying the judgment of the Exchequer Court of Canada, that the respondent is entitled to receive from His Majesty the sum of $900, but that the interest of 51 per cent per annum, represented by coupons attached to the bonds, is not recoverable CROWN-Continued from His Majesty. Held: There can be no dispute that the document accepted by the
Bank as a transfer of the registered bonds was not signed by the respondent and that the signature thereon does not purport to be made by a person acting for her. Neither does the evidence support the contention that the purported signature must be presumed to have been written under her authority.
Held: The interest on these bonds was payable by coupons which could have been cashed by anyone.
It is impossible to hold that the loss of the interest represented by the coupons was a result of the Bank or His Majesty acting on the alleged transfer. Held: No other interest may be allowed against the Crown unless there is a statute or agreement providing for it, Hochelaga Shipping and Towing Co.
Ltd. v. The King [1944J S.C.R. 138.
The clause in the judgment a quo for recovery by His Majesty from the Royal
Bank of Canada of the principal directed to be paid by the former to the respondent should remain.
RACETTE........
2.-Master and servant-Relationship between Crown and member of armed forces of Canada settled by statute-Crown entitled to action per quod servitium amisit-Measure of damages-Section 50A the Exchequer
Court Act retroactive-The Exchequer Court
Act R.S.C. 1927, c. 34, ss. 19 (c), 30 (d),
60A.
Act, R.S.O., 1987, c. 288, s. 60(1) .....
3.-Retired judge receiving a pension- Appointed
Lieutenant-Governor- Whether entitled to both salary and pension-Interest against the Crown-Judges Act, R.S.C.
1927, c. 105, s. 27-British North America
Act.-In 1921, upon resigning as a judge, the late Mr. Justice Carroll was entitled to a pension of $6,000.
During the years
1929 to 1934, as Lieutenant-Governor of the province of Quebec, at a salary of
$10,000 a year, be received only $10,000 annually, the appellant withholding the sum of $6,000 each year. The respondents sought to recover from the appellant the sum of $30,000 and interest, and the
Exchequer Court, [1947] Ex. C.R. 410, awarded them $30.000 but without interest.
Appellant appealed to this Court and respondents cross-appealed on the question of interest.
Held: The appeal and crossappeal should be dismissed with costs.
Held: There can be no recovery of interest against the Crown unless provided by contract or statute.
Per the Chief Justice and Taschereau and
Estey JJ.:-The functions of a Lieutenant-Governor are in respect of the Government of the Province for which he is appointed.
Per Kellock and Locke JJ.:-The office of Lieutenant- Governor cannot be described as an office
CROWN-Concluded under the Governor General in Council. THE V. CARROLL............... 4.-Negligence-Petition of Right-Collision on highway between civilian automobile and blacked-out army transport-Exchequer Court Act, 1927, R.S.C c. 34, S. 19 (c) amended by 1988, S. of 6., c. 28-Highway Traffic Act, R.S.O. 1937, c. 288, s. 10, ss. 1 and 2-Negligence Act, R.S.O. 1937,c. 115- Militia Act, R.S.C., 1927, c. 132, s. 42.. 357 CUSTOMS DUTY - Revenue - Customs Tariff Act, R.S.C. 1927, c. 44, Schedule A, Item 710 (a), (b), (bb), (c), (d), (e), (f)- Gasoline imported in drums-Packaging charges-Whether duty payable on packaging charges-"Packing"-Fair market value of fluid as packaged................. DAMAGES-Action against deceased's estate for breach of promise to marry-Whether cause of action survives-General damages-Special damages- Whether corroboration of promise sufficient-Whether breach or postponement-Trial by jury-Trustee Act, R.S.O., 1987, c. 165, s. 87-Eidence Act, R.S.O. 1937, c. 119, s. 10, 11.-Held: (Kellock J., dissenting)-That the right of action for damages for breach of a promise to marry survives after the death of the promisor by reason of subsection two of section 37 The Trustee Act, R.S.O., 1937, chapter 165.
Per the Chief Justice and Taschereau, Estey and Locke JJ.: What is to be considered is the nature of the injury rather than the form of the action in which redress may be obtained; and the injury occasioned is a personal injury to the plaintiff.
Such an injury is a wrong to the plaintiff "in respect of his person" within the meaning of ss. 2 sec. 37 of the Trustee Act, whether it results from a breach of contract or is occasioned by a tort. Per Kellock J. (dissenting): action does not survive, in so far as general damages are concerned, as it is an action for breach of contract.
MOORE........................ 2.-Municipal Law-Tender for construction of water and sewerage system- Offer submitted and accepted by municipal Council-Acceptation cancelled by Council before formal contract signed by parties- Damages-Municipal Code sections 624, 625, 626, 627...
................. EVIDENCE-Criminal law-Conspiring to defraud-Effect of reception of inadmissible evidence-Appeal from conviction-Onus on Crown under section 1014 (2) of Criminal Code-Trial by judge alone-Trial judge's report under section 1020 of Criminal Code- Substantial wrong and miscarriage of justice -New Trial-Section 444 of Criminal Code EVIDENCE-Concluded
-Department of Munitions and Supply Act,
1940 Statutes of Canada, 31-Interpretation Act, R.S.C. 1927, I...........
2.-Criminal law-Evidence of accomplice
-Corroboration-Nature of evidence required for corroboration-Circumstantial evidence-Recent trial
Judge in passing sentence-Cr. Code S. 1009,
1014-Charge of retaining stolen goods under
Cr. Code S. 399.....................
3.-Criminal Law-Accused charged murder entitled have all his defences adequately put to jury trial judge-Appellant conspired with two others hold up and rob bank, when block away turned back, were intercepted police and appellant disarmed
-Companion attempting to escape killed policeman - Whether appellant party offence of murder within meaning of S. 69
Criminal Code, or had abandoned common intention prosecute unlawful purpose- Whether such common intention was (a)
attempt to rob bank; to resist arrest by violence and assist each other in doing so;
or conspiracy rob bank-Whether trial judge erred in charging jury appellant guilty of an attempt rob bank within meaning
S. (2) of Criminal Code...........
4.-Criminal law-Incest-Brother and sister-Trial jury-Evidence of consanguinity-Admissions accused-Hearsay- Criminal Code section 204 ............
5.-Criminal Law-Evidence-Corroboration-Unsworn testimony of child of tender years-Offence, under section
Criminal Code, of carnally knowing girl between ages 14 and years-Canada
Evidence Act, section (2)-Criminal Code sections (2), 1002, 1008, 1023 .....
FRAUDS, Statute of- HABEAS CORPUS-Criminal law-Alien
-Convicted of offence under section
Opium and Narcotic Drug Act, S. of 1929,
49-Warrant for commitment not stating reasons-Deportation Order-Amendment to warrant-Immigration Act. R.S.C. 1927,
93-Section 57, Rules and 78 of the
Supreme Court of Canada.-In August 1947,
Mr. Justice Kellock directed that all parties concerned attend before him to show cause why a writ of habeas corpus should not issue directed to the District Superintendent of Immigration at Vancouver. return was made, not by the District Superintendent, but by the Commissioner of Immigration, stating that the applicant was held by him for deportation under a warrant
HABEAS CORPUS-Continued of commitment dated September 13, 1945. This warrant was signed by the Commissioner and was directed to the District Superintendent or any Canadian Immigration officer, and it followed form G in the schedule to the Immigration Act with the important exception that it did not recite as the form provides: "And whereas under the provisions of the Immigration Act an order has been issued for the deportation the said .
. .
. .". copy of a deportation order, dated September 1945, was produced before Mr. Justice Kellock, although objected to by the applicant because it was not made part the return. Then Mr. Justice Kellock permitted the filing of a new return which was dated September 1947, was signed by the Commissioner and had attached to it a copy of the same warrant September 1945, and a copy of the same order for deportation September 8, 1945. Subsequently the respondent again filed a new return dated September 1947 this time signed by the Acting District Superintendent and which had attached to it a copy the same warrant of September and a copy of an order for deportation September which contained a statement that the applicant was an alien and had been convicted an offence under paragraph of section 4 the Opium and Narcotic Drug Act, 1929. Then Mr. Justice Kellock directed that in view the statement of facts found, as appears in the order attached to the last return, the application for a writ of habeas corpus should be dismissed. The present appeal is from the decision of Mr. Justice Kellock. Held: The appeal to this Court should be dismissed. Per The Chief Justice,
Kerwin, Taschereau and Rand JJ.: The words in section 26 the Opium and Narcotic Drug Act, 1929, accordance with the provisions of the Immigration Act relating to inquiry, detention and deportation", require us to examine the provisions the Immigration Act relating to inquiry, detention and deportation. The officer named in the warrant must be able to justify his detention of the accused. It clearly appears that such a warrant depends upon an order for deportation and this is borne out by the fact that the form warrant in the Schedule to the Act, Form G. provides for the recital such order. The warrant for commitment and the order for deportation may be read together. The original order was defective because did not state the facts upon which the Board of Inquiry acted. But proper order being subsequently produced, effect should be given to it and the applicant detained custody. The Acting District Superintendent is now able to justify the applicant's detention and the Court will not on a habeas corpus proceeding such as this inquire into any irregularity his caption. Per Estey J.: If the warrant is issued with out a sufficient reference to the order deportation, it is to that extent defective HABEAS CORPUS-Continued or incomplete. It would appear that the requirements of the Statute are satisfied by setting out in the warrant such description or identification of the order for deportation that either the accused or the party detaining him may identify same.
Warrants defective because of omissions both as to substance and to form have been before the Courts and where they have recited a conviction or order which exists in fact, permission to amend the warrants has been granted. Opportunity to amend the warrants has been granted.
Opportunity to amend the warrant should be given in this case. Neither the provisions of section 43 nor Form G contemplate the setting forth of the term of imprisonment for the offence under section 4 (d) of the
Opium and Narcotic Drug Act, 1929. The question as to the right to appeal cannot be dealt with upon an application for habeas corpus where the issue is confined to determining the legality of the applicant's retention in custody, and this right is not affected by the result of such application.
Ex PARTE
GoEY Sow.........
2.-Immigrant - British subject -Temporary permit-Application to rema'n in
Canada permanently-Board of inquiry- Right to be present or represented on appeal to the Minister-Deportation order-"To the place whence he came or to the country of his birth or citizenship"-Service of order on transportation company
- Extraterritoriality-Immigration Act, R.S.C. 1927, c. 93-Orders in Council P.C.
695,
1413, 3016-Statutes of Canada, 1982-83, c. 89.-The appellant, a British subject, born on the Island of Mauritius, landed in
Canada from Cuba on or about 15 March,
1945, as member of a crew of a ship which went into dry-dock and was ultimately sold in Canada. He was granted a temporary permit to enter Canada which expired on 15 May.
A Board of Inquiry, on 17
May, 1945, refused him permanent admission on grounds which were read and explained to him.
An appeal taken to the
Minister was dismissed. On 10 August,
1945, he was allowed thirty days in which to arrange his departure voluntarily and on 27 September, 1945, he was granted an extension of stay until October 13.
He did not leave Canada as he says that he could not find shipping accommodation to either England or Cuba and in the meantime he made application to the Department of Immigration for further indulgence but without success.
Finally, on
April, 1947, the Commissioner of Immigration issued a warrant for his "arrest, detention and deportation" upon which he was detained.
He obtained a writ of habeas corpus and the Superior Court, affirmed by the Court of King's Bench, Appeal Side, refused to order his discharge.
He appealed to this Court. Held: The appeal should be dismissed with costs. Per the Chief Justice
HABEAS CORPUS-Concluded Kerwin,
Taschereau and Kellock JJ.:-The Immigration Act does not lay down any requirements as to form in the case of a warrant. The contention that the order for deportation was incapable of being acted upon because it did not contain the reasons for the decision and was not served upon the transportation company, cannot be upheld. The order, although in two documents, was served upon appellant. The transportation company is the one to raise the objection of lack of service upon it. In the circumstances here present, the only country authorized by the Act to which he could be deported was the country of his birth or citizenship and not whence he came.
There is nothing in evidence to support the argument that the right to enforce the order has been lost by failure to act upon it immediately. An appellant has no right to appear personally or to be represented on the appeal to the Minister.
Per Rand J.:-The contention that the order for deportation was not sufficient, cannot be upheld. In the administration of the Immigration Act, what is to be looked for and required is a compliance in substance with its provisions. LANGLAls........... IMMIGRATION-Habeas corpus-Criminal law-Alien-Convicted of offence under section 4 of Opium and Narcotic Drug Act, S. of C., 1929, c. 49-Warrant for commitment not stating reasons-Deportation Order -Amendment to warrant-Immigration Act, R.S.C. 1927, c. 93-Section 57, Rules 72 and 78 of the Supreme Court of Canada. 37 2.-Habeas corpus-Immigrant-British subject-Temporary permit-Application to remain in Canada permanently-Board of Inquiry-Right to be present or represented on appeal to the Minister-Deportation order-"To the place whence he came or to the country of his birth or citizenship"- Service of order on transportation company- Extraterritoriality-Immigration Act, R.S.C. 1927, c. 93-Orders in Council P.C. 2S, 695, 1413, 3016-Statutes of Canada, 1932-33, c.39..........................
INCOME TAX-Revenue-Excess Profits -Income derived from personal investments- Whether subject to Excess Profits Tax- Carrying on business-Excess Profits Tax Act, 1940.-The appellant, for the taxation year 1940, derived his revenue from three sources: (a) from his fees as manager of the International Loan Company, a real estate mortgage loan company; (b) from a small fire insurance agency; (c) from personal real property mortgage investments- and small loans. The Minister of National Revenue assessed the appellant under the Excess Profits Tax Act on the ground that the income received in respect of mortgages held by him constitutes part of the income INCOME TAX-Continued derived from the carrying on of one or more businesses within the meaning of par. (g)
of Section 2 of the Excess Profits Tax Act.
The Court of Exchequer came to the conclusion that the appellant was carrying on a money lending business and therefore liable to the tax. It is not disputed that the income from the insurance agency would be liable to excess profits taxation if sufficient in amount.
Held: No indication can be found in the Excess Profits Tax Act,
1940, of an intention to classify as a business the investment of moneys by private individuals under the circumstances of this case and there is nothing in the evidence which justifies the conclusion that the appellant was carrying on business as a money lender or that he was trading in securities or buying and selling them with a view to profit.
As for the income derived from his managing duties, he was a paid servant or employee and therefore not carrying on business.
Robbins v. Inland
Revenue Commissioners 11920] 2 K.B. 677;
Smith v. Anderson [1880] 15 Ch. D. 247 and South Behar Ry. Co. v. Inland Revenue
Commissioners [1925] A.C. 476, referred to.
2.-Revenue-Whether sub-paras. (a) and
(b) of Rule 1, s. 1, para. A of 1st Schedule,
Income War Tax Act, are conjunctive- Whether when pursuant to S. 6S (2), pleadings are filed in Exchequer Court, onus of proof is decided by state of such pleadings- Whether such pleadings constitute "an action" or an appeal from taxation-Income
War Tax Act, R.S.C., 1927, c. 97, s. 68 (2);
Rules 1 and 2 of s. 1, of para. A of 1st
Exchequer Court Act, R.S.C., 1927, c. 84
(am. 1928, c. 23, S. 4)-Exchequer Court
Rule 88.-Held: Rule 2 of Section 1, Paragraph A of the First Schedule of the Income
War Tax Act, R.S.C. 1927, c. 97, has no relationship to a particular sub-paragraph of Rule 1 under which a person becomes taxable. Rule 1 provides for a certain rate of taxation for persons coming within a number of classes; if among those taxpayers, one is found meeting the description of
Rule 2, then the rate is to be as prescribed by that rule. Held: also,-Locke J. dissenting-Where an appeal under
Income War Tax Act has been set down for trial before the Exchequer Court of Canada, such appeal notwithstanding the language of section 63 (2) of the Income War Tax
Act, is an appeal from taxation, and though pleadings be directed, the burden of proof is not shifted; the taxpayer must establish the existence of facts or law showing an error in relation to the taxation imposed upon him.
Per Locke J. :-When pursuant to section
63, subsection 2, of the Income War Tax
Act pleadings have been delivered, then as provided by section 36 of the Exchequer
Court Act, the question of onus of proof on the various issues to be determined must, in
INCOME TAX-Continued accordance with the practice of the High Court of Justice in England, be decided upon the state of these pleadings. Upon the pleadings in this matter the onus was upon the Minister to prove affirmatively that the appellant supported his wife during the taxation year and, as this was not done, the claim of the Minister failed and the appellant was entitled upon the admissions made to a declaration that he was taxable at the lesser rate provided by Rule 1.
REVENUE................. 3.-Revenue-Salary "free from income tax"-Payment of income tax as part of salary-Bonus-"Rate of salary established and payable"-Income War Tax R.S.C. 1927, c. 97-Excess Profits Tax Act 1940, S. of C. 1940, c. 32-Wartime Salaries Order, P.C. 1549, February 27, 1942.- At a general meeting of the shareholders of the respondent on June 2, 1941, resolutions were passed directing that its general manager and four of its officials as of January 1, 1941, should be paid certain specified amounts as salary "free from income tax", although by the Articles of Association of the Company the directors had the power to make such arrangements. Article 103 provided that the directors might from time to time appoint one of their body as managing director; Article 105 provided that the remuneration of the managing director should be fixed by the directors and Article 123 provided that the directors might appoint such managers, secretaries, officers, etc., as they consider necessary and fix their salaries. The resolutions passed by the shareholders remained unchanged, but changes in the Income War Tax Act required that the respondent pay larger amounts as income tax on ehalf of each of the officials.
In assessing the respondent for income and excess profits tax, the appellant, in 1943 and 1944, disallowed certain sums as "unauthorized salary increases" on the basis that the payments of the increased income taxes represented increases in the "rate of salary" of these officials contrary to section 2 of the Wartime Salaries Order, P.C. 1549, dated February 27, 1942.
It was also contended by the Minister that the resolutions were not legally binding upon the company because they did not conform to the constitution of the company or to the Companies Act.
The Exchequer Court held that the resolutions were binding, that the payment of income tax was not a bonus and that the "rate of salary established and payable" was not increased. Held: The resolutions were valid and binding upon the parties.
(Barron v. Potter [1914] 1 Ch. 895; Foster v. Foster [1916] 1 Ch. 532 and Worcester Corsetry Ltd. v. Witting [1936 1 Ch. 640 followed. Kelly v. Electrical
Construction
10 O.W.R. 704; Colonial Ass. Co. v. Smith [1912] 22 Man. R. 441; Automatic Self INCOME TAX-Concluded
Cleansing Filter Syndicate Co. Ltd. v.
Cunninghame [1906] 2 Ch. 34 and Salmon v. Quin [1909] 1 Ch. 311 distinguished).
Held (Kellock and Estey JJ. dissenting):
The rate of salary was not increased by maintaining the mode of determining it.
(Judgment of the Exchequer Court [1947]
Ex. C.R. 458 affirmed).
Per The Chief
Justice, Rand and Locke JJ.:-The "rate of salary" in this case was that determined by a mathematical computation in which one of the factors was the variable scale of income tax rates; the words "rate of salary" are to be interpreted as meaning the salary arrangement and not the quantum of the salary. Per Kellock and Estey
JJ. (dissenting)
:-The salary rate "established and payable" was the amount per annum which the respondent was paying the employee, and therefore the payment of additional amounts by reason of an increase in income tax rates over and above the rate existing on November 6,
1941, falls within the prohibition of sec. 2
(a) of the Order.
On the question as to whether the payment of income tax could be regarded as a bonus within the meaning of sec. 2 (d) of the Order, The Chief
Justice, Rand and Kellock JJ. expressed no opinion while Estey and Locke JJ.
held that it was not a bonus. Even assuming that it was a bonus, The Chief
Justice and Rand J. held that it would fall within the exception of sec. 2 (d)
(Kellock and Estey JJ. dissenting). MINIsv. GREAT
WESTERN Co. LTD.........
INSURANCE-Automobile - Liability for damages caused a truck a pedestrian- Delay in giving notice-Reasonable excuse- Impossibility of giving notice-Acceptance notice without prejudice- Investigation facts-Waiver of failure to comply with conditions of the policy-Art. 2478 C.C.-Appellant's truck, through an accident to the steering gear, became unmanageable, overturned and struck a pedestrian walking on the sidewalk along Victoria Street, Montreal
South. The pedestrian declared that he was not injured and refused to be taken to a doctor or hospital. Appellant did not notify his insurer, the respondent, although a clause of his policy stated that notice was to be given promptly whenever an accident involving bodily injury happened.
Two months later, the pedestrian claimed damages for injuries in the amount of $2,204.50.
Appellant notified his insurer who accepted to investigate without prejudice.
Finally the insurer refused to indemnify the appellant. The Superior Court's rejection of appellant's action against respondent was confirmed by a majority of the Court of
King's Bench, appeal side.
appeal should be dismissed. Per The Chief
Justice and Kerwin, Taschereau and Locke
JJ.:-It is not up to the insured to determine the gravity of the damages and to judge whether the insurer should investi- INSURANCE-Continued gate. His obligation is to give notice and failure to do so relieves the insurer from responsibility. The insurer did not waive his rights when he accepted to investigate without prejudice. Per Rand J.:-There was sufficient to indicate to a reasonable and prudent person that bodily injury had most probably been suffered. It was not impossible, in the circumstances, for the insured to have given the notice. The facts had to be ascertained by the insurer before he was in a position to declare himself one way or the other. MARcoux 2.-Boiler explosion policy-Use and Occupancy endorsement provided indemnity for each day of total prevention of business caused solely an accident to insured object but excluded liability if resulting from fire outside of object-Total prevention of business caused concurrent accident to object and fire outside of object-Whether words "Caused solely an accident" excluded liability.-An insurance company by clause "A" of a use and occupancy endorsement attached to an accident policy, agreed to pay the insured $1,000 for each day of total prevention of business on the premises therein described, caused solely by an accident to an object covered by any of the schedules of the policy, subject to a limit of loss of $100,000 for any one accident. Clause "G" of the endorsement provided that: "The Company shall not be liable for payment for any prevention of business resulting from an accident caused by fire or by the use of water or other means to extinguish fire (nor for any prevention of business resulting from fire outside of the object, following an accident.) * * *" "Accident" was defined in the policy to include a sudden and accidental explosion of gas within the furnace of the object set out in the schedule. "Object" was defined to mean a boiler as described in the schedule, provided the explosion occurred while the boiler was being operated with gas and oil. The policy expired on November 1, 1941, but at the request of the insurance broker of the insured, company's special agent furnished a "binder", including the use and occupancy endorsement, for the month of November. The loss occurred on November 21. The insured alleged the damage was caused by an explosion followed by a fire. The company contended that there was no explosion but that all the damage was caused by the fire. Held: (Taschereau and Estey JJ., dissenting)-That the effect of the parenthetical phrase in clause "G"i.e. "(Nor for any prevention of business resulting from a fire, outside of the object, following an accident)"-was to make clear that a fire caused by an explosion was to be deemed to be completely severed from the explosion for the purposes of clause "A". It characterized "accident" in clause "A" by confining it to explosive action. It thus declared the meaning of clause INSURANCE-Concluded
"A": that the word "solely" restricted the cause for which there was liability to purely explosive effects as against a resulting fire. Per Taschereau and Estey JJ.:
The provision limiting liability inserted in clause "G" applied only to total prevention of business resulting from fire outside of the object and could not be extended to prevention of business resulting from damage to the object caused by an accident when the two results were concurrently effected. Hobbs v. The Guardian Fire &
Life Assce. Co. (1886) 12 S.C.R. 631 and
Wadsworth v. Canadian R'y. Accident Insce.
Co. (1914) 49 S.C.R. 115 referred to.
LTD..................
JURISDICTION-Criminal law-Theft- Goods valued at less than 825-Summary trial
Deputy
Jurisdiction
Magistrate-Cities and Towns Act Quebec,
233 R.S.Q. 1941, sections 647, 648-Summary Convictions Act of Quebec, 25 R.S.Q.
1941, section 6-Criminal Code, section 771
(a) (i)...........................
LICENSEE - Licensee - Peac, Celebration spectators in city park injured wh en boys climbing on flag tower caused its collapse-Duties imposed on licensor.-In response to a notice published the Mayor of St. Catharines requesting citizens to observe and co-operate in a programme prepared for the observance of
"Victory-over-Japan Day", a large crowd gathered in Montebello Park the evening of August Here, in addition to band concerts and dancing, a display of fireworks was given under the direction of
"G", the manager of the city's Board
Park Management. The fireworks were in the "Rose Garden" which had been fenced for that purpose. Some 25 feet from the fence there was a tower constructed of light iron framework, some 70 feet high, surmounted by a flagpole. Earlier in the evening "G" had twice ordered small children off this structure. Later, while he was directing the fireworks display, a number of boys climbed upon the tower. Their combined weight caused it to collapse and fall upon the spectators thereby killing the daughter of one of the appellants and injuring two of the other appellants. Held:
The respondents were liable for negligence.
Per Rinfret C.J., Kerwin and Estey JJ.:- The maxim novas actus interveniens did not apply because the presence the boys upon the tower, even though unauthorized, was the very thing that should have been anticipated. The Court was unanimously of opinion that on the facts of the case was not necessary in fixing liability to determine whether the members of the public attended the park as invitees. Rinfret C.J. and Kerwin J., agreed with the trial judge that the respondents were liable
LICENSEE-Concluded as licensors whose duty it was to warn a licensee of any concealed danger known to the licensor, and that "G" knew of the danger created by the weight upon the tower. Baker v. Borough of Bethnal Green 1 A.E.R. at 140. Per Estey J.: This was a case a licensee after entering upon the premises being injured by virtue of the negligence of the licensor within the principle of Gallagher v. Humphrey 6 L.T. 684. Per Rinfret C. J. and Kerwin J.: Having permitted the public to enter the park, the respondents were under a duty not to create or permit others to create a new danger without giving warning of its existence. The presence of the boys on the tower was a danger respondents permitted to be created and to continue. No warning was given and, Per Rinfret C.J., Kerwin and Estey J.J: The danger was not apparent to the parties injured. Per Rand J.: The standard of reasonable foresight was applicable to the circumstances of the demonstration.
The city's act bringing about the gathering was of such a nature as called for reasonable precautions against foreseeable risks and dangers lurkingin fact within it,an actwhich unaccompanied by that degree prudence, became a misfeasance. Per Kellock J.: reasonably prudent man would have anticipated, having seen the fact demonstrated on two occasions, that young people would repeat their attempts to climb the tower and that if too many climbed on it, it.was likely to fall, and would have taken means to prevent such use of the tower. Per Estey J.: The injuries here claimed for were suffered not because of any defect in the condition the premises but rather that the respondents were negligent in not taking reasonable steps to prevent the boys from climbing upon the flagpole. Decision of LeBel J. O.R., 628, affirmed. CATHARINES........................ LIMITATIONS, Statute of- MASTER AND SERVANT-Relationship between Crown and member of armed forces of Canada settled statute-Crown en-. titled to action per quod servitium amisit- Measure of damages-Section 50A the Exchequer Court Act retroactive-The Exchequer Court Act, R.S.C. 1927, 34, ss. 19 (c), 30 (d), 50A. The Militia Act, R.S.C. 1927, 132, ss. 48, 69.-The Ontario Highway Traffic Act, R.S.O., 1987, 288, 60(1). (Reversing the judgment appealed from).
The relationship master and servant between the Crown and a member of the armed forces of His Majesty in the right of Canada is definitely settled by section of the Exchequer Court Act and entitles the Crown to bring an action per quod servitium amisit the same as any other master. Held: the language of section 50A makes it clear that it applies to pro- MASTER AND SERVANT-Concluded ceedings already commenced at the time it came into force. On the measure of damages, the Court was of the unanimous opinion that the Crown's claim for disbursements for medical and hospital expenses was properly allowable. As to the
Crown's claim for pay and allowances:
Held: per Kerwin, Taschereau, Rand and
Estey J.J. (Kellock J. dissenting in part)
that this item was properly allowable as the fact of such payment was some evidence, and therefore sufficient evidence, of the value of the services that were lost to the Crown. Held: per Kellock J. (dissenting). If amounts paid for wages have any revelance in an action such as this, it must be for whatever evidenciary value they have as to the value of the lost services which form the subject matter of the claim. It is for the plaintiff to prove the value of the services lost. Proof of payment of pay and allowances of the soldier without more is not sufficient to entitle the appellant to recover in respect of pay and allowances'as such. The Crown may however recover the cost of the soldier's maintenance after his discharge from hospital and before his return to duty.
KING v. RICHARDSON................
MORTGAGE-Limitation of Actions- Mortgage-Whether in the absence of a written agreement, a voluntary forbearance by a mortgagee to enforce payment of principal and interest and mortgagor's acceptance of extension of time, prevents the running of the Statute of Limitations, R.S.O., 1937, c. 118, s. 28-Statute of Frauds, R.S.O.,
1937, c. 146, 4.-Held: Voluntary forbearance by a mortgagee to enforce payment of a mortgage will not, in the absence of anything done or promised by the mortgagor to bind the mortgagee to forbear, prevent the running of the Statute of
Limitations, R.S.O., 1937, c. 118, s. 23.
Per Kellock J.:-Assuming that the parties to the mortgage verbally agree to extend the time of payment until the mortgagor should be able to pay, the agreement cannot, by, reason of the Statute of Frauds, be permitted to be proved for the purpose of varying the terms of the mortgage.
V. MuNRo...................
MOTOR VEHICLES-Negligence-Motor vehicle-Collision between motor vehicle and bicycle-Presumption of fault created by section 53 of the Quebec Motor Vehicles Act- Bicycle turning left without signalling- Horn of overtaking vehicle sounded-Responsibility for accident-Quebec Motor Vehicles
Act, R.S.Q. 1941, c. 142, 8. 53 ........
2.-Negligence - Collision - Intersection of public highways-Right of way- Liability-Duties of both drivers-Joint negligence-Quebec Motor Vehicles
R.S.Q. 1941, C. 142, s. 86, ss. 7-Notice of appeal-Continuance of suits-Joint and
MOTOR VEHICLES-Concluded several obligations-Payment by one of the joint and several debtors-Subrogation- Intervention-Arts. 1117, 1118, 1156 C.C.- Arts. 269, 278 C.C.P.-Supreme Court Rule 60............................ 3.-Negligence-Motor vehicle-Reasonable user of highway-Lighted flares set out on highway to mark broken down truck- Flares stolen after driver left for help-Police turned on marker lights-Oncoming motor car collided head-on in fog-Whether truck driver negligent-Whether nuisance created- Standard of care-Proximate cause of accident act of third party-Public Service Vehicles Act, R.S.A. 1942, c. 276, Reg. 1-10-2......... .....
......... 4.-Negligence-Motor vehicle-Collision between motor vehicle and bicycle-Bifurcation of two streets-Presumption of fault created by section 53 of the Quebec Motor V ehicles Act-Responsibility for accident- Quebec Motor Vehicles Act, R.S.Q. 1941, c. 142, s. 58....................
5.-Crown - Petition Right-Collision on highway between civilian automobile and blacked-out army transport- Exchequer Court Act, 1927, R.S.C., c. 34, s. 19 (c) amended by 1988, S. of c. 28- Highway Traffic Act, R.S.O. 1937, c. 288, s. 10, s. 1 and 2-Negligence Act, R.S.O. 1937, c. 115-Militia Act, R.S.C., 1927, c. 132, s. 42...........
....... 6.-Motor vehicle-Negligence-Pedestrian struck by car making right-hand turn- Duty of driver-Statutory onus-The Highway Traffic Act, R.S.M. 1940, c. 93, s. 56 (1), 81(1)-The Tortfeasors and Contributory Negligence Act, R.S.M. 1940, c. 215 8.4 (3),8.......................... MUNICIPAL
CORPORATION - Municipal Act, R.S.O. 1937, chapter 255, as enacted by the Statutes of Ontario, 1941, chapter 35, section 13-Part of building and lands appurtenant used for school purposes on date of passing of by-law setting up restricted area-Whether exempt from by-law under provisions of section 406 (2) of the Municipal Act.-Held: On the date of the passing the by-law the building and the lands appurtenant, were being used for a purpose not permitted by the by-law and therefore under the provisions of The Municipal Act, section 406 (2), the by-law did not apply. Held: In considering the application of subsection 2 of section 406 of The Municipal Act, the important date is the date of the passing of the by-law, and not the date such by-law is approved by the Municipal Board.
If on the date -Continued of the passing of the by-law a part of a building is used for a purpose prohibited by the by-law, the building as a whole is exempt.
Toronto Corporation v. Roman
Catholic Separate Schools Trustees [1926]
A.C. 81 and Re Hartley and the City of
Toronto (1925) 56 O.L.R., 433, considered distinguished.
TORONTO........................
2.- Tender for construction of water and sewerage system-Offer submitted and accepted by municipal Council-Acceptation cancelled by Council before formal contract signed by parties-Damages-Municipal Code sections
624, 625, 626, 627.-Tenders were called by the respondent for the construction of a water and sewerage system, and appellant submitted an offer to do the work for a devis" plus an undetermined amount for the excavation of rock at the rate of $3 a cubic yard. This offer was accepted at a meeting of respondent's Council.
At a subsequent meeting of the Council, but before a formal contract before Notary had been signed by the parties, the acceptation of appellant's offer was rescinded.
In his action, appellant asked that respondent be forced to sign a contract or pay him damages in the amount of $25,000.
When the case came for trial, another contractor had already executed the work, and the
Superior
Court awarded him
$5,000 damages.
The Court of King's Bench maintained the appeal and dismissed the action in toto. Held: The agreement between the parties was, by the requirements of the Municipal Code, dependent on the signature of a contract, and as long as this contract was not signed, one of the parties could back out. More so in this case where the offer submitted and the resolution to accept it were at variance.
BROWNSBURG....................
3.-By-Laws - Approval of Municipal
Board-By-Law illegal in part-The Municipal Act, R.S.O., 1937, c. 266, s. 406, as re-enacted by 1941, c. 85, s. 13, and amended by 1948, c. 16, s. and 1946, c. 60, s. 50.
"Repealed and amended" ss. 4.-The appellant corporation passed a by-law approved by the Municipal Board pursuant to the provisions of s. 406 of the Municipal Act,
R.S.O., 1937, c. 266 and amendments, prohibiting the use within a defined area of land, or the erection or use of buildings, for other than residential purposes.
second paragraph of the by-law provided a penalty for breach thereof, and by the second sentence therein, that each ten days during which the prohibited conditions were maintained should constitute a separate offence. S. 406(3) of the Municipal
Act provided that no part of any by-law passed under the section should come into
MUNICIPAL CORPORATION
-Concluded force without the approval of the Municipal Board and ss. 4 provided no part of any such by-law approved by the Board should be repealed or amended without the approval of the Board. The respondents applied to the Supreme Court of Ontario for an order determining their rights and for an order quashing the by-law for illegality. trial judge quashed the by-law. On appeal to the Court of Appeal all members of that Court agreed that the second sentence of paragraph two of the by-law was not authorized by the provisions of s. 406, but the majority were of the view that because of the provisions of ss 3 and 4. there could be no severance. Held: That the words "repealed or amended" in 406(4) are not referable to any order or judgment of a Court but are applicable merely to an attempt on the part of a municipality to amend or repeal a by-law which has already been approved by the Municipal Board. City of Chatham v. Sisters of St. Joseph 1940 O.W.N., 548 distinguished. Per Rand and Kellock JJ.: The principle of severance can be applied to a by-law which is invalid in part when the invalid part is not enacted under s. 406 and is not therefore subject to the approval of the Municipal Board. NEGLIGENCE-Motor vehicle-Collision between motor vehicle and bicycle-Presumption of fault created by section 53 of the Quebec Motor Vehicles Act-Bicycle turning left without signalling-Horn of overtaking vehicle sounded-Responsibility for accident -Quebec Motor Vehicles Act, R.S.Q. 1941, c. 142, s. 5.-The respondent, while riding his bicycle on Ste. Marguerite Street, in Three Rivers, Quebec, was struck down and injured by a truck owned by one of the appellants, Jean Charbonneau, and driven by his son and employee, Paul Charbonneau, the other appellant. The accident occurred around 7 o'clock in the morning; it was still dark, but the lights of the truck were on and the visibility was good. Both the truck and the bicycle were proceeding in the same direction, the truck following the bicycle.
Suddenly, without warning or signal, the respondent turned left to cross the road to his house. He was hit by the truck which was about to overtake him after having sounded its horn 3 or 4 times. The respondent sought to recover from the appellants, jointly and severally, the sum of $10,252.25.
The trial judge awarded him the sum of $4,572.25, but the Court of King's Bench reduced it to $2,236.13, on the ground that there was contributory Held: The appeal must be allowed.
Held: The appellants have rebutted the presumption of fault created by section 53 of the Quebec Motor Vehicles Act. The appellants committed no fault, and the determining cause of the damage was the imprudent act of the respondent in turning suddenly to his left without having given any previous indication of his intention so to do.
2.-Motor vehicle-Collision-Intersection of public highways-Right of way-Liability
-Duties of both drivers-Joint negligence- Quebec Motor Vehicles Act, R.S.Q. 1941, c.
142, 86 ss. 7-Notice of appeal-Continuance of suits--Joint and several obligations-Payment by one of the joint and several debtors-Subrogation-Intervention- Arts. 1117, 1118, 1156 C.C.-Arts. 269, 971,
278 C.C.P.-Supreme Court Rule 60. A ten ton truck driven by one of the respondents,
Brandon, and belonging to the other respondent, Huctwith, collided with an automobile driven by the appellant, Miss
Theriault. A passenger in the automobile,
Alphonse Jongers, was injured and sued
Miss Theriault and the two respondents jointly and severally. The trial judge held the three defendants to be jointly and severally liable and awarded the sum of
$8,500. The two respondents appealed to the Court of King's Bench, but did not serve the notice of appeal upon Miss
Theriault who did not appeal. Before the case was heard by the Court of Appeal,
Miss Theriault paid to Jongers the full amount of the judgment, namely $8,500.
Jongers died subsequently, but still before the hearing of the case by the Court of
Appeal, and in his will appointed Miss
Theriault as his testamentary executrix and universal legatee, with the result that Miss
Theriault continued the suit as respondent es-qual in the Court of Appeal and as appellant es-qual before this court, but is not personally before this court. The Court of Appeal maintained the appeal and dismissed the action in toto. The accident occurred in the evening and both vehicles had their lights on. Miss Theriault was driving northerly on a road known as
"Mont6e des Sources". She was in the act of crossing the concrete strip, some 22 feet in width, occupying the northerly section, (which alone was in use) of the
Metropolitain Boulevard, a highway running east and west, and her car had reached the asphalt shoulder to the north with only the rear wheels remaining on the concrete when she was struck on the right rear by the right front of the respondent's truck, then travelling west. There was on the Boulevard a warning sign located some 560 feet east of the intersection requiring the speed of vehicles at that point to be reduced to 20 miles an hour and also another sign indicating the intersection itself. Respondent's truck covered a distance of 200 feet after the impact with his brakes on before coming to a stop. The appellant stopped before entering the
Boulevard. Held: The appeal should be allowed with costs and the judgment of the trial judge restored.
Per the Chief
Justice and Taschereau J.: The accident was the result of the common fault of the three defendants. Subsection 7 of section 36 of the Quebec Motor Vehicles Act does not exempt the driver of the dominant car from exercising proper care and attention. After the payment made by Miss Theriault, which payment also benefited to those who were with her jointly and severally liable, Jongers was entirely disinterested from the case and could not further exercise any claim against the three defendants, but Miss Theriault could recover from the other defendants the share and portion of each of them, though she was specially subrogated to the rights of Jongers. As her cause of action against the other two resides in the judgment of the trial judge, and as a party cannot be deprived of its rights without being called properly in the case, the notice of appeal should have been served upon her. She only continued the suit as testamentary executrix and universal legatee to protect and defend the rights of the original plaintiff Jongers. The appeal here is merely to find if there is a joint and several liability between the tort feasors. Miss Theriault is the only person with sufficient interest, who may claim that the Court of Appeal erred when it deprived her of her rights, without her being present in the case as a party, to ask that the judgment of the trial judge be upheld. As the English doctrine of equitable title and trustee with legal title is unknown in the law of the Province of Quebec, Miss Theriault should be made a party in this case.
Per Kellock and Locke JJ.: The respondents ought to have served Miss Theriault with the notice of appeal, as she was the only person interested in maintaining .the judgment. It is therefore proper that she should now be added. The fact that Brandon had the statutory right of way, as provided for in ss. 7 of s. 36 of the Quebec Motor Vehicles Act, does not, in the circumstances, absolve him from his failure to act as he could and should, had his inattention and probably also his excessive speed not prevented his so doing. AL....... 3.-Motor vehicle-Reasonable user of highway-Lighted flares set out on highway to mark broken down truck-Flares stolen after driver left for help-Police turned on marker lights-Oncoming motor car collided head-on in fog-Whether truck driver negligent-Whether nuisance created-Standard of care-Proximate cause of accident act of third party-Public Service Vehicles Act, R.S.A. 1942, c. 276, Reg. 1-10-.-Held: reversing the judgment of the Appellate Division (1947
2 W.W.R. 49; 1947 4 D.L.R. 294) (Rand J. dissenting) that the appeal should be allowed. Per the Chief Justice and Estey J.: the appellant was properly using the highway when his truck broke down and he did not act contrary to law in leaving it with sufficient warning of its presence to the public. His duty was to exercise the care of a reasonable man under all the circumstances.
He put out what upon the evidence was reasonable protection for those using the highway; that protection was deliberately removed by some person who had no regard whatsoever for the safety of the public. No duty is imposed upon a person to anticipate such contemptible conduct unless the circumstances justify that conclusion. They do not in this case. Per Taschereau and Locke
JJ.: It was not the failure of the appellant to take reasonable care which was the direct or proximate cause of the accident, rather was it (subject to what there is to be said as to the negligence of Shafer) the act of the thief "the conscious act of another volition" of the nature referred to by Lord
Dunedin in Dominion Natural Gas Co. v.
Collins, 1909 A.C. 640 at 646. Per the
Chief Justice, Taschereau, Estey and Locke
JJ.: If a nuisance was created and existed at the time of the accident it was created by the act of the unknown third party.
Per Rand J. (dissenting)
: The individual user of a highway is limited by what can be accorded all persons in similar circumstances and by the reconciliation of convenience in private and public interests.
The truck, at the time of the accident was a nuisance dangerous to persons using the highway in the ordinary manner. If instead of removing it, means were taken to guard against the danger, they must be maintained at all events and be as effective as removal itself. When the exigencies of modern traffic bring about an unavoidable but exceptional use of the highway, the risk of potential danger becoming actual which it creates must be circumscribed in time and a duty arises to act reasonably, with modern aids, to prevent its realization.
The duty here, was shown not to have been discharged. SHAFER........
4.- Motor vehicle-Collision between motor vehicle and bicycle-Bifurcation of two streets-Presumption of fault created by section 53 of the Quebec Motor Vehicles
Act-Responsibility for accident--Quebec
Motor Vehicles Act, R.S.Q. 1941, c. 14,
.
53.-The respondent was proceeding West on St. Paul Street, Quebec, riding his bicycle.
As he was attempting to turn left in order to enter Boulevard Charest, he collided with appellant's truck which was proceeding East on St. Paul Street. The accident occurred at a busy rush hour.
Appellant admits driving at approximately
20 M.P.H.
The trial judge found the respondent solely responsible but the majority of the Court of King's Bench,
Appeal side, held that there had been contributory negligence.
Respondent did not cross-appeal and the sole question on this appeal is whether the appellant was at fault. Held: The appeal should be dismissed with costs. Per The Chief Justice and Taschereau and Estey JJ.:-The appellant has not rebutted the presumption of
26682-3 fault created by section 53 of the Quebec Motor Vehicles Act.
It was his duty to slow down his speed in order to have complete control of his truck and to stop if necessary.-Per Rand and Kellock JJ.:- The appellant did not show that the care demanded in approaching this bifurcation at a busy rush hour was exercised by the driver of its truck and that his course of action did not contribute to the accident. 5.- Crown-Petition of Right-Collision on highway between civilian automobile and blacked-out army transport-Exchequer Court Act, 1927, R.S.C., c. 34, a. 19 (c) amended by 1938, S. of C., c. £8-Highway Traffic Act, R.S.O. 1987, c. 288, s. 10, as. 1 and 3-Negligence Act, R.S.O. 1937, c. 115- Militia Act, R.S.C., 1927, c. 13, e. 4.- On the night of Sept. 16, 1943, the suppliant's automobile, proceeding west on Ontario Highway 17 some four miles from Petawawa Military Camp, turned out to pass another car travelling in the same direction and almost immediately collided head-on with a blacked-out field army transport.
The transport formed part of a convoy of blacked-out army vehicles engaged in night manoeuvres.
The convoy was headed by a motor cycle and station wagon, both fully lighted with regulation lights, followed by a number of blacked-out army transports; a further group of blackedout vehicles followed at an interval of some 150 yards; a third group, led by the transport involved in the collision, brought up the rear at a further interval of some 300 yards.
This transport was driven by Lieutenant James Coyle, a member of the military forces of His Majesty in the right of Canada, acting within the scope of his duties.
As a result of the accident the suppliant's car was badly damaged, the driver severely injured and the other occupant killed.
transport was slightly damaged.
In an action against the Crown under sec. 19(c) of the Exchequer Court Act, the trial judge found there was negligence on the part of both drivers- Coyle in driving the vehicle without lights when he was so far out of his proper position in the convoy; the driver of the suppliant's car in attempting to pass another vehicle going in the same direction without ascertaining the travelled portion of the highway, in front of and to the left of the vehicle to be passed, was safely free from approaching traffic. He apportioned the degree of fault as seventy per cent on the part of the Crown's driver and thirty per cent on the part of the suppliant's driver. Held: affirming the judgment of the Exchequer Court of Canada [1946] Ex. C.R. 589 (Kellock and Locke JJ. dissenting)-That the accident was caused by the negligence of both drivers and in the degree designated by the trial judge.
Held: also, that the Ontario Negligence Act applied and that the Crown's liability under section of the Exchequer Court Act is not confined to cases where the negligent act of the Crown's officer or servant is the sole cause of the injury. Per the Chief Justice,
Kerwin and Estey JJ.: The effect of the trial judge's finding that Coyle was negligent in driving the vehicle without lights when he was so far out of his proper position in the convoy, cannot be dissipated by saying that Coyle could not change the lighting equipment of the transport driven by him. Per Kellock and Locke JJ.
(dissenting):
Where damage ensues to a person by the act of another person who is acting in the pursuance of lawful orders the wrongful act, if any, occasioning the damage is not the act done in obedience to orders, but negligence in the giving of the order itself. Reney v. Magistrates
[1892] A.C. 264; The Mystery [1902] p. 115;
Hodgkinson v. Fernie C.B.N.S. 415.
the law thus stated, applied to the case at bar, it cannot be considered that there was any negligence on the part of Coyle either causing or contributing to the accident in question.
6.-Motor vehicle-Pedestrian struck by car making right-hand turn-Duty of driver- Statutory onus-The Highway Traffic Act,
R.S.M. 1940, 98, 56 (1), (1)-The
Tortfeasors and Contributory Negligence
Act, R.S.M. 1940, 215, s. 4 (8), 8.- Action for damages sustained by respondent when, at an intersection, he was struck by the projection of a grain box attached behind the cab of appellant's truck while it was making a right-hand turn onto the street respondent was crossing.
The trial judge dismissed the action and the Court of
Appeal held that respondent was entitled to recover the full amount of the damages assessed by the trial judge. Held: The appellant's negligence in not complying with the provisions of section 56 (1) of the
Highway Traffic Act and in not keeping a proper lookout, makes him liable for twothirds of the damages; the respondent was also at fault for not keeping a proper lookout before entering the intersection.
Kellock and Locke JJ. would have allowed respondent one-half of his damages.
Eurymedon (1938 Prob. 41) and Sershall v.
Toronto Transportation Commission (1939)
S.C.R. 287 referred to.
7.-Licensee-Peace Celebration spectators in city park injured when boys climbing fiag tower caused its collapse-Duties imposed on licensor.-In response to a notice published by the Mayor of St. Catharines requesting citizens to observe and co-operate in a program prepared for observance of "Victory-over-Japan Day", a large crowd gathered in Montebello Park the evening of August 15, 1945.
Here, in addition to band concerts and dancing, a display of fireworks was given under the direction of "G", the manager of the city's
NEGLIGENCE-Cntinued
Board of Park Management. The fireworks were set off in the "Rose Garden" which had been fenced off for that purpose. Some 25 feet from the fence there was a tower constructed of a light iron framework, some 70 feet high, surmounted by a flagpole.
Earlier in the evening "G" had twice ordered small children off this structure. Later, while he was directing the fireworks display, a number of boys climbed upon the tower. Their combined weight caused its to collapse and fall upon the spectators thereby killing the daughter of one of the appellants and injuring two of the other appellants.
Held: The respondents were liable for
Per Rinfret C.J., Kerwin and Estey JJ.:-The maxim novus actus interveniens did not apply because the presence of the boys upon the tower, even though unauthorized, was the very thing that should have been anticipated.
The Court was unanimously of opinion that on the facts of the case it was not necessary in fixing liability to determine whether the members of the public attended the park as invitees. Rinfret C.J. and Kerwin J., agreed with the trial judge that the respondents were liable as licensors whose duty it was to warn a licensee of any concealed danger known to the licensor, and that "G" knew of the danger created by the weight upon the tower.
Baker v. Borough of Bethnal Green [19451 1 A.E.R. 136 at 140. Per Estey J.: This was a case of a licensee after entering upon the premises being injured by virtue of the negligence of the licensor within the principle of Gallagher v. Humphrey (1862) 6 L.T. 684. Per Rinfret C.J. and Kerwin J.: Having permitted the public to enter the park, the respondents were under a duty not to create or permit others to create a new danger without giving warning of its existence. presence of the boys on the tower was a danger respondents permitted to be created and to continue. No warning was given and, Per Rinfret C.J., Kerwin and Estey JJ.: The danger was not apparent to the parties injured.
Per Rand J.: The standard of reasonable foresight was applicable to the circumstances of the demonstration. The city's act in bringing about the gathering was of such a nature as called for reasonable precautions against forseeable risks and dangers lurking in fact within it, an act which unaccompanied by that degree of prudence, became a misfeasance. Per Kellock J.: A reasonably prudent man would have anticipated, having seen the fact demonstrated on two occasions, that young people would repeat their attempts to climb the tower and that if too many climbed on it, it was likely to fall, and would have taken means to prevent such use of the tower. Per Estey J.: The injuries here claimed for were suffered not because of any defect in the condition of the premises but rather that the respondents were negligent in not taking reasonable NEGLIGENCE-Concluded steps to prevent the boys from climbing upon the flagpole. Decision of LeBel J.
[19461
O.R.,
628, affirmed.
PATENT-Invention - Novelty - Subject-matter-Utility-Combination sub- Ject-matter of valid patent must produce useful and operatii contrivance-Possess novelty-Be susceptible of fulfilling its purpose, and must enable a person skilled in the art carry it out.-The Plaintiffs brought action against the Defendant for infringement of Wandscheer Letters Patent No.
309,848 and Curtis Letters Patent No.
253,159, both of which related to snow removers. In the Exchequer Court [1946]
Ex. C.R. 112, Angers J., held that as to the Wandscheer patent, there had been anticipation, and that the claims alleged to have been infringed only required the use of ordinary mechanical skill and did not involve that amount of inventive ingenuity which should be rewarded by a patent; that as to the Curtis patent, its first object offered- no novelty but was anticipated by prior patents, and its second object was inoperative and useless the patent consequently invalid.
Held: That as to the Wandscheer patent, the judgment of the learned trial judge be affirmed and the appeal dismissed
Held: Per the Chief Justice, Taschereau and Rand JJ. (Kellock and Estey JJ.
dissenting) that as to the Curtis patent, the appeal be dismissed. Per the Chief Justice and Taschereau J.: the Curtis rotating ejector had no usefulness and was not workable.
It could not serve the purpose mentioned in the patent. The device patented by the respondent is different and is operative.
A combination may be the subject-matter of a valid patent, even if it is merely the juxtaposition of known elements, but this juxtaposition must produce a useful and operative contrivance which has the indispensable character of novelty. The alleged invention must be susceptible of fulfilling its purpose, and it must enable a person skilled in the art to carry it out. Per Rand J.: On the evidence a prima facie case against utility in rotary discharge by reason of insufficiency in specification has, I think, been made out, but I am unable to say that the onus thus arising has been met by the appellants.
On what is before us, I must hold that at best what Curtis presented to the public was both the idea and the task of working it out. Per Kellock and Estey JJ. (dissenting): The Curtis patent had not been anticipated by prior patents. The combination to be found in the Curtis patent was a new conception and the element of inventive ingenuity required by the authorities was present in the combination claimed by the patent. The invention was an advance on anything in existence at the time, and the specification, which
26682-32
PATENT-Concluded should receive a benevolent construction, was sufficient.
While the utility of the equipment was limited, it would appear from the evidence, that whatever it lacked was a matter of trial involving no invention, which could be worked out by any skilful mechanic, and that the respondent had infringed upon the patent. 2.- Claim for patent for substance prepared or produced chemical process and intended for food or medicine, must include claim for patent for process which substance prepa-ed or produced-Meaning words "claims", "described and claimed", "claimed"-The Patent Act, Statutes Canada, 1985, 32, ss. 84, 85, 37 (2), 40 (1), (2),, (3).-The respondent applied for a patent for an invention relating to a substance prepared by a chemical process and intended for medicine but did not claim for the process by which it was produced. The Commissioner of Patents rejected the application on the ground that by section 40 (1) of the Patent Act, claims for substances covered by it must be accompanied by claims for the processes by which they are prepared. The respondent appealed to the Exchequer Court of Canada.
The appeal was allowed. On appeal to this Court Held: A claim for a substance alone, cannot under section 40 (1) of the Patent Act, be entertained. The applicant's specification should describe the method or process by which the substance is prepared or produced and claim a patent therefor in the manner specified in section 35. Per the Chief Justice and Estey J.: There appears no reason to conclude other than that Parliament intended these words "claims" and "described and claimed" should have the same meaning and significance in section 40 (1) as in sections 34, 35 and 37 (2) of the Act, so construed it meant that the applicant's specification should describe the method or process and claim a patent therefor in the manner specified in section 35. Per Taschereau and Kellock JJ.: Tnere appears to be no reason for giving the word "claimed" (as used in section 40 (1) of the Patent Act) other than the ordinary meaning of the word. (Short v. Weston, 1941 Ex. C.R. 69 at 95) and (Winthrop Chemical Co v. Commissioner of Patents, 1937 Ex C.R. 137) followed. Per Rand J.: Considering the language of section 40 I think it quite impossible to say that it has not a plain and ordinary meaning which is quite consistent with the remaining provisions of the Act and is wholly without incongruity or absurdity. So reading the words "claims" and "claimed", the subsection clearly denies any right to a patent for a substance unless there is, in addition, a claim in its technical sense for the mode or process of producing it. Com- RAILWAY-Constitutional Law - Application of Hours of Work Act, R.S.B.C., 1986, c. 122, to Employees of C.P.R. Hotel- Whether hotel part of the "undertakings" of a railway-Whether "lines of" includes
"railways"-Whether hotel included in the term "railways"-Whether Parliament has made a declaration as to hotels-Property and Civil Rights-Effect of Collective Bargain and P.C. 1003 (Dom.)-The B.N.A. Act, s. head 29, s. 92 head 10 (a) and (c)- The Railway Act, 1868, S. of C., 1868, c.
69, ss. 5 (16), 7 (8) (10)-The Consolidated Ry. Act., 1879, S. of C., 1879, c. 9, ss.
7 (8) (10) Am. 1883, c. 24, s. 6-Canadian
Pacific Ry. Act, 1881, S. of C., 1881, c. 1,
Schedule "A" s. 17-The Railway Act, 1888,
S. of C. 1888, s. 2 (9), Am., 1892, c. 37, s.
Act, 1908, S. of C., c. 58, s. 2 (s) (w)- The Railway Act, R.S.C., 1906, c. 37, s
(15), (21), (28), (33), (151)
(c) (g)- The Railway Act, 1919, S. of C., 1919, c.
68 ss. 3 (31), (38), 6 (c)-War Measures
R.S.C.,
1937, c. 306-The Can
National-Canadian Pacific Act, 1933, S. of
C., 198 c. 88, ss. 8 (g), 27A as enacted by,
1947, c. 38, s. 1-The National Emergency
Transitional Powers Act, 1945, S. of C.,
1945, c. 35.-An hotel is not an integral part of a railway and therefore does not fall within the meaning of the term "railways" as used in section 92 head 10 (a) of the British North America Act; nor has the
Parliament of Canada made a declaration as to hotels under section 92 head 10 (c) of the Act. An hotel therefore does not fall with the class of subjects to which in virtue of section 91 head 29 of the Act, the exclusive Legislative Authority of the Parliament of Canada extends. (Appeal dismissed and judgment of the Court of Appeal for British Columbia affirmed.)
C.P.R.
BRITISH
COLUMBIA..........................
REVENUE-Customs Tariff Act, R.S.C.
1937, c. 44, Schedule A, Item 710 (a), (b),
(bb), (c), (d), (e), (f)-Gasoline imported in drums-Packaging charges-Whether duty payable on packaging charges-"Packing"- Fair market value of fluid as packaged.- The respondent agreed to purchase Ethyl fluid from the Ethyl Corporation, a company carrying on business in the United
States, either in tank cars f.o.b. Ethyl's plant or in drums. If the fluid was shipped in drums, Ethyl would credit the respondent with a freight allowance based on the weight of the fluid content of the drums and at the prevailing tank car rate, and the respondent agreed to pay Ethyl "a per drum packaging charge which will be established from time to time by Ethyl." From
October 1942 to September
1945, respondent imported a certain quantity of fluid in drums, and, on each importation duty was paid upon a declared value marked on the invoice and showing merely the cost of the fluid at the price agreed upon
REVENUE-Concluded between the parties but not the packaging charge. The Crown took proceedings to recover the duty on the charges for packing the fluid. The Exchequer Court dismissed the action. Held, reversing the judgment appealed from, [1947] Ex. C.R. 452, that there were packaging charges imposed on respondent by Ethyl. Held: The contention that the word "packing" in paragraph (f) of Item 710 does not describe the placing of a liquid in containers such as drums, cannot be upheld. Held: The fair market value of the fluid as packaged is the invoice price of the fluid plus the actual amount charged for packaging. Held: Even if the packaging charge had been charged separately on the invoice, it would not have taken the lower rate applicable to the fluid itself. v. L/TD........
..................
2.-Income tax-Excess Profits-Income derived from personal investments-Whether subject to Excess Profits. Tax-Carrying on business-Excess Profits Tax Act, 1940. 467 3.- Income Tax-Whether sub-paras. (a) and (b) of Rule 1, s. 1, para. A of 1st Schedule, Income War Tax Act, are conjunctive-Whether when pursuant to S. 63 (3), pleadings are filed in Exchequer Court, onus of proof is decided by state of such pleadings-Whether such pleadings constitute "an action" or an appeal from taxation- Income War Tax Act, R.S.C., 1927, c. 97, s. 63 (2); Rules 1 and 2 of s. 1 of para. A of 1st Schedule (am. 1944-45, c. 43, as. 31, 33)-The Exchequer Court Act, R.S.C., 1937, c. 34 (am. 1928, c. 23, s. 4)-Exchequer Court Rule 88....................... 4.-Income tax-Salary "free from income tax"-Payment of income tax as part of salary-Bonus-"Rate of salary established and payable"-Income War Tax Act, R.S.C. 1937. c. 97-Excess Profits Tax Act 1940, S. of C. 1940, c. 33-Wartime Salaries Order, P.C. 1549, February 37, 1949.......... SALARY-Crown-Retired judge receiving a pension-Appointed Lieutenant-Goveinor -Whether* entitled to both salary and pension-Interest against the Crown-Judges Act, R.S.C. 1927, c. 105, s. 37-British North America Act.................. 2.-Revenue-Income tax-Salary "free from income tax"-Payment of income tax as part of salary-Bonus-"Rate of salary established and payable"-Income War Tax Act, R.S.C. 1927, c. 97-Excess Profits Tax Act 1940. S. of C. 1940, c. 33-Wartime Salaries Order, P.C. 1549, February 37, 194... 585 See TAx 3
Constitutional law-Statutory exemption from taxation-Parliamentary contract- Public statute-Severance tax-Levies
-Indirect taxation-Interpretation Act, 2 of Consolidated Act, 1877 of B.C.-Forest
Act. R.S.B.C. 1936, 123, am. 29,
Statutes of 1946-Constitutional Questions
Determination Act, 50, R.S.B.C., 1936 403
STATUTES- 1.-Assessment Act, (N.S.)
2.--Bankruptcy Act, R.S.C. 1927, s. 45, 108 (6).......................
3.-B.N.A. Act, (1867) s. 58, 59, 67,
90...............................
4.--B.N.A. Act, (1867) s. 92 ....
B.N.A.
Act, (1867), s. (29), 92
(10) (a) (c).......................
6.-Canada Evidence Act, R.S.C. 1927,
59, 16 (2).....................
7.-Canadian National-Canadian Pacific
Act, 1933 (Dom.) c. 3 (g), 27 as enacted S. of 1947, 28, s. .....
8.- Canadian Pacific Ry.
(D om .)c.1........................
9.-Canadian Pacific Ry.
City of Charlottetown Incorporation
Act, P.E.I. 50, 65 ......
12.-Civil Service Act, R.S.C.
1927,
22 ..............................
13.-Consolidated Ry. 1879 (Dom.)
s. 7 (8), 10....................
14.-Contitutional Questions Determination Act, R.S.B.C. 1936, 50 ........
STATUTES-Continued
15.-Criminal Code, R.S.C. 1927, 36, s. 444, 1014 (2), 1020............... 16.-riminal
Code, R.S.C. 1927, 36, 399, 1002, 1014 ...................
17.-Criminal Code, R.S.C. 1927, 36, s. 69 (2), 72 (2)...................
18.--Criminal Code, R.S.C. 1927, 56, s.204..............................
19.--Criminal Code, R.S.C. 1927, 36, s. (2), 1002, 1003, 1028 .......... 20.- Criminal Code, R.S.C. 1927, 36, s. 771..............................
21.- Criminal Code, R.S.C. 1927, 122 ..............................
See 7.
22.- Customs Act, R.S.C. 1927, 42, s.85 ...............................
26.-Excess Profits Tax Act, 1940, S. 1940, 32 .......................
27.-Excess Profits Tax Act, 1940, S. 1940, 82......................
28.-Exchequer Court R.S.C. 34, s. 19 (c), 30 (d), 50A.......... 29.- Exchequer Court R.S.C. 1927, 34, 19 amended S. of 1938, c.28.............................
30.-Exchequer Court Act, R.S.C. 1927, 84, amended 28, of 1928 .......... STATUTES-Continued
31.-Extra-territorial Act, 193, S. of C.
198-1983, c. 39.....................
32.-Forest Act, R.S.B.C. 1956, c. 102,
128, Am. 29, Statutes of 1946 .....
33.-Highway Traffic Act, R.S.O. 1937, c.288,s.60 (1).....................
34.-Highway Traffic Act, R.S.O. 1987, c.588, s.10........................
35.-Highway Traffic Act, R.S.M. 1940, c. 93, s.56 (1), 81 (1).............. 544
36.-Hours of Work Act, R.S.B.C. 1936, c.12.........................
37.-Immigration Act, R.S.C. 1927, c. 98, s.43..........................
38.-Immigration Act, R.S.C. 1957, c. 93
...................
39.-Income War Tax Act, R.S.C. 1957, c. 97, s. 63 (2)......................
40.-Income War Tax Act, R.S.C. 1957.
c.97...............................
41.-Interpretation Act,
R.S.C. 1957, c.1 ................................
42.-Interpretation Act, c. 2 of Consolidated
Act, 1877 of B.C...................
43.--Judges Act, R.S.C. 1957, c.105,
44.-Militia Act , R.S.C. 1957, c. 135, s.48,69...........................
45.-Militia Act, R.S.C. 1957, c. 13, a. 42
...................
46.-Minimum Wage Act, R.S.S. 1940, c.310..............................
47.- Motor Vehicles Act, R.S.Q.
1941, c.142, s.53........................
STATUTES-Continued
48.-Motor Vehicles Act, R.S.Q. 1941, 142, 8. 36 (7)..................... 49.-Motor Vehicles Act, R.S.Q. 1941, c. 145, . 58........................ 50.-Municipal Act, R.S.O. 1987, c. 266 as enacted S. of 0. 1941, 35, 406...........................
51.- Municipal Act, R.S.O. 1937, c. 566, s. 406.........................
52.- Munitions and Supply Act, 1940 (Dom.) c.31....................... 53.--National Emergency Transitional Powers Act, 1945 (Dom.) c. 25 ....... 54.- R.S.O. 1937, c. 115............................. See 5.
55.--Opium and Narcotic Drug Act, S. of C. 1959, c. 49, s.26................. 56.-Patent Act, 1935 (Dom.) c. 35, 3. 34, 35, 57 (2), 40 (1) (5) (8) ...... Post Office Act, R.S.C. 1957, c. 161, a. 2,6 ............................. 58.- Public Service Vehicles Act, R.S.A. 1945, c. 576...................... 59.-Railway Act, R.S.C. 1906, c. 87, s. 2 (15) (21) (58) (38) (151) .......... 60.-Railway Act, 1919 (Dom.) c. 68, s.2 (21) (58), 6 (c)................ 61.-Real Estate Agents' Licensing Act, R.S.A. 1945, c. 318............... 62.- Succession Duty Act, R.S.Q. 1941, c. 80, S. 3 (8), 14................... See WILL 2.
63.- Summary Convictions Act, R.S.Q. 1941, c. 55, a. 6..................... 64.-Supreme Court Act, R.S.C. 1957, c. 35,s. 57......................
[B.C.R. STATUTES-Concluded
65.-Tortfeasors and Contributory Negligence Act, R.S.M. 1940, c. 215, 8. 4 (3),
8..................................
66.-Trustee Act, R.S.O. 1937, c. 165,
67.-War Measures Act,
R.S.C. 1927, c. 206..............................
TAXATION-Assessment Act, Statutes
Nova Scotia, 1938, c. 2-Assessment of companies-No incompatibility between 8. 10 and s. 28-S. 28 not an exclusive code for assessment of companies-Company a person under s. 10 and neglect of company to comply with assessor's demand under s. 10 entals penalty under s. 15 of loss of right of appeal- N.S. Assessment Act, 1938, c. 2, 2, 10, 1£,
13, 15, £8-80 and 38.-Section 10 of The
Assessment Act, Statutes of Nova Scotia, 2
Geo VI, 1938, chapter 2, requires every person to give all necessary information to the assessors if required by them, for the purpose of enabling them properly to assess him. Section 15 provides that every person, who-(a) refuses to give the assessors information by them reasonably required;
or (b) refuses to furnish any particulars required by this Act or by the forms prescribed thereby; or (c) neglects to fill up and return the form referred to in Section
10 of this Act after being requested by an
Assessor to do so, shall not be entitled to appeal from the assessment of his property or income. Section 28 (1) provides that assessing the property of any joint stock company, other than a banking company, and its agencies, the assessors shall, before the assessment for the whole municipality is made up, notify in writing the managers or resident agents of the several joint stock companies in the town or municipality of the value at which they estimate the property of such companies, and require such manager or agents, if they object to such valuation, to severally furnish to such assessors * * * written statements, under oath * * * of the actual value of the real property and of the personal property of such companies * * * Sub-section provides after service of the notice upon any such manager or agent 14 days shall be allowed him to furnish the assessors with such written statement, under oath * * *
Section 29 provides where the manager or resident agent delivers such written statement * * * the assessors shall adopt the valuation sworn to, which shall be binding, subject only to appeal by the clerk under the provisions of this Act.
Section 30 provides that if such statement is not furnished within the time and in the manner prescribed, the assessors shall proceed upon their own original valuation, and such valuation shall then be binding, subject
TAXATION-Concluded only to appeal under the provisions of this Act. Held: There is no incompatibility between the subject matter of section 10 and section 28. The former provides information on which the assessors' valuation is in large measure based, and which is in fact a prior necessity under section 28. The latter section does not embody an exclusive code for the assessment of companies. A company is therefore a "person" within the meaning of section 10. Held.- Since the right of appeal given companies under section 30 lies only "under the provisions of this Act"; neglect by a company to comply with the provisions of section 10, an obligation placed on all ratepayers, entails the penalty under section 15, of the loss of the right to appeal from the assessors' valuation. OxFoRD MUNICIPALITY 2.-Exemption f-om taxation-Proviso to The City of Charlottetown Incorporation Act, P.E.I., 1981, chapter 31, section 65-"provided that no property in transit or awasting shipment abroad shall be assessed;"-Goods in stock and held for preparation and disposal prior to shipment excluded from exemption.-The appellant engaged in the buying and selling at wholesale of canned fish, chiefly lobsters. It bought from packers along the shores of the Maritime Provinces, the Magdalen Islands and Newfoundland. The goods were delivered to appellant's warehouse at Charlottetown; here they were tested for defects in canning, graded, labelled, assembled in cases and stored. On receipt of directions from its head office in Montreal, they were then shipped out of the Province to various points, mostly in carload lots. The City of Charlottetown assessed the goods so stored and the appellant claimed exemption under the proviso contained in the City of Charlottetown Incorporation Act, 21 Geo. V. (1931) ch. 31 sec 65 i.e. "provided that no property in transit or awaiting shipment abroad shall be assessed:" (Reporter's note:-It was common ground that the word "abroad" as used in the Statute meant "out of the Province" and that the canned goods were not "in transit".) Held: The transitory nature of the "awaiting" envisaged in the words "awaiting shipment" in section 65, City of Charlottetown Incorporation Act, P.E.I., 1931, chapter 31, excludes goods which are in stock and are held for preparation and disposal. J. W. WINDsoR Co. UHARLOTTETOWN......... 3.-Constitutional law-Statutory exemption from taxation-Parliamentary contract- Public statute-Severance tax-Levies-Indirect taxation-Interpretation Act, c. 2 of Consolidated Act, 1877, of B.C.-Forest Act, c. 10£, R.S.B.C. 1986, s. 128, am. c. £9, Statutes of 1946-Constitutional Questions Determination Act, c. 50, R.S.B.C., 1936 403 TRUSTS-Will-Succession duties - Property transmitted in trust-Net revenues to life beneficiaries-Usufruct-Life rent-Endowment-Quebec Succession
Duty Act,
R.S.Q. 1941, 80, 8 (8), 18-Arts. 448,
449 486, 981a, 1787, 1788, 1901, 1909,
. ...............................
WAGES-Constitutional Law - Minimum
Wages-Legislative Jurisdiction-Provincial
Statute-Postal Service-Employee of a Revenue Post Office-Temporarily Engaged
Postmistress-Whether Employment Subject to Prorincial Minimum Wage Act-Post
Act R.S.C. 1997, 161-Civil Service
Act, R.S.C. 1997, 99-Minimum Wage
Act, Sask., R.S.S. 1940, 810-British
North America Act, SS. 99........
WILL-Gift contingent on legatee's survival of testatrix ten years- Legatee given power of appointment will only-Gift in event of death meanwhile without exercise power-Whether absolute vested gift-Whether legatee entitled demand immediate payment
-Power of appointment will only distinguished from power exercised will, deed or otherwise.-The testatrix devised and bequeathed all her ebtate to trustees upon the following trusts: (1) to pay to her son as soon as possible one-half of the residue;
(2) to invest the other half and to pay the said son as long as he should survive the testatrix the income therefrom, and at the end of 10 years from her death to convey to the said son the remainder of her estate;
(3) in the event of the son dying within 10 years of her death the share which he would nave received had he survived the
10 years to be distributed as he should by his last will appoint, and in default of appointment to be distributed in the same manner as if the share had formed part of the son's estate whether he died testate or intestate. The testatrix died in January
1946. The son, having received the first half, now demands the other half. The trial judge found that this was an absolute vested gift, but the Court of Appeal ruled that he was not entitled to receive now the entire residue of the estate. Held: When a gift is contingent upon the legatee surviving the testator by ten years and the power of appointment can only be exercised through the medium of his will, which is a limited power as distinguished from a power which might be exercised by will, deed or otherwise, the legatee has not an absolute vested gift and cannot therefore demand the immediate payment of the gift.
.......
WILL-Continued
2.- Succession duties - Property transmitted in trust-Net revenues to life beneficiaries-Usufruct-Life rent-Endowment -Quebec Succession Duty Act, R.S.Q. 1. 1, 80, s. 8(8), 18-Arts. 448, 449, 486, 981a, 1787,1788,1901,1909 C.C.-The appellants are the trustees of the estate of the late C. B. Roach, of New York of which approximately one-third was situated in the Province of Quebec. By his will, the testator conveyed to the trustees the ownership of his estate and gave the net revenues to three life beneficiaries. After the death of the three beneficiaries, the revenues are to be paid to charitible institutions. Province of Quebec assessed the duties payable as if the three beneficiaries were receiving as owners. The Superior Court held that this was a case of life rent and reduced the amount of duties (ss. 8 of s. 3). The majority of the Court of King's Bench held the view that this was a case of usufruct and that the duties payable should be calculated as if the usufructuary received as absolute owner (s. 13). Held: The appeal should be allowed with cost. Per Rand, Estey and Locke JJ.:-This is not a case of usufruct as the beneficiaries have only a personal right against the trustees and not a real right in the property. Under see. 3 of the Quebec Succession Duty Act, what is transmitted is the ownership, usufruct or enjoyment, but what is liable to duties is each individual transmission of whatever nature it may be. The contention that once any form of enjoyment is transmitted, the property out of which it arises, in its entirety, becomes liable to the tax, and that it is the first enjoyment that controls the rate of taxation, rejected. When these bequests of the revenue from the sums set aside are made to the legatee, each legacy becomes a subject of taxation, and the periodic payments must by some means of estimation be brought to an attributed capital value. Semble, it is a life rent within the meaning of ss. 8 of sec. 3, for what is to be looked for is the genus of the particular modes of enjoying the property mentioned which is intended to be brought within the scope of the subsection. Per The Chief Justice and Taschereau J. (dissenting):-This is not a case of a life rent because the amount is not certain, fixed and determined. It is not a case of usufruct as the beneficiaries have not a real right in the property. They have neither the possession nor the administration and therefor do not have to draw an inventory, to give security and cannot bring action for the preservation of the property. The beneficiaries have only a personal right in the revenues, which constitutes a simple legacy of revenues. Section 13 of the Quebec Succession Duty Act indicates only by whom and how the duties will be payable and it does not affect the provisions of sec. 3 which stipulates that the duties payable WILL-Continued are not based on the value the enjoyment but are imposed on the total value of the property transmitted.
Co. THE .....
3.-Dependants' Relief-Provision for
Widow-Matters to considered in determining proper allowance-Impropriety considering relations between Testator and
Applicant-The Dependants' Relief Act,
R.S.O., 1987, 214, 2, 7 and 9.-Section
7 of The Dependants' Relief Act, R.S.O.
1937, requires a judge hearing an application to enquire into and consider the matters therein specifically enumerated, including under clause "generally any other matters which the judge deems should be fairly taken into account in deciding upon the application."
Held: In the case of an application made on behalf of the widow a testator, it is sufficient that the appellant is the widow and is not disentitled to relief under the Act by reason of section 9.
Any considerations other than those specifically mentioned in section
7 are entirely foreign to a matter arising under the provisions of the Act.
(In Re
McCaffrey
O.R.
512, followed.)
4.-Form derived from the laws of England
Essential formalities-Acknowledgment testator-Signature witnesses-Art. 851,
855 C.C.-The testator, being too sick to write and sign his name, dictated his will to his employee and had him sign as a witness. Later on a second witness was brought to the testator and the document was read in the presence of both witnesses.
The testator then acknowledged the document as his will and the second witness signed.
The Court of Appeal (Marchand J.
dissenting) held that the will was valid, even though some of the formalities had not been strictly followed.
appeal should be allowed.
Held: The disposition Art. C.C. which requires that the signature must be acknowledged by the testator as having been subscribed by him to his will in presence at least two witnesses who must then sign, is an essential formality the absence of which is fatal to the will.
5.-Construction - Charitable Trust - Bequest Church "to added to the Endowment Fund"-No Endowment Fund-Whether good charitable gift or void for uncertainty.-A testatrix made a residuary bequest-"To pay all the rest, residue and remainder of my estate to the St. Andrew and Wesley Church, Vancouver, B.C., to be added to the endowment fund."
(Kerwin J. dissenting), that the gift was a good bequest, its purpose prima facie religious, and so charitable.
(Schoales v.
Schoales Ch. 75- White v. White
(1893) 2 Ch. followed.
Per Kerwin J.
WILL-Concluded dissenting, the gift failed because it did not fall within the preamble and intendment of the statute of Elizabeth since the absence of an endowment fund does not permit a court of equity to establish a fund with objects that could undoubtedly be charitable within the meaning of the rule. (Williams v. Inland Revenue Commissioners (19471 A.C., 447; Dunn v. Byrne [1912] A.C. 407; In re Lawton [1940] 1 Ch. 984, followed.)
Appeal allowed and judgment of the trial judge restored.
ST. AL....... WORDS AND PHRASES- S- "Any criminal offence"
(Criminal Code, s. 122).......................
2. -"Awa'ting shipment" (City of Charlottetown Incorporation P.E.I. s. 65).......................
3.- "Carrying on business" (Excess Profits
Tax
1940,
S. 1940, (g))................
4.- "Claims" (Patent Act, S. of 1935, 32, s. 40)........................
............
7.-"Other functionary" (Criminal Code, (a) (1)).....................
8.-"Packing" (Customs Tariff Act, R.S.C. 1927, 44, Schedule Item 710 (f)). . 9.-"Person" (N.S. Assessment Act, 1938, 2, s. 10)........................
10.-"Railways"
(B.N.A.
1867, s.92, (10))........................
11.--"Renewed"
(Real Estate Agents' Licensing R.S.A. 1942, 318, 7) 306 12.-"Repealed and amended" (Municipal Act, R.S.O. 1937, 266, 406 (4). 557
Cases cited
- 7 7, supra
- Victoria City v. Bishop of Vancouver Island A.C. 384 387
- A.C. 456 A.C. 456 460
- A.C. 476 A.C. 476
- Hobbs v. Guardian Assurance Co. scr-12-631
- Wadsworth v. Canadian Railway Accident Ins. Co. scr-49-115
- A.C. 264 A.C. 264
- A.C. 407 A.C. 407
Statutes and regulations cited
-
Supreme Court Act
-
- s. 123
-
- sections 624
- 625
- 626
- 627
- section 801
- section 16
- sections 801
- section 1014
- section 1020
- Section 444
- section 444
- section 19
- s. 1002
- 1014
- s. 899
- section 204
- section 501
- sections 301
- section 301
- sections 647
- section 6
- section 771
- s. 122
- s. 7
- ss. 19
- s. 48
- 69
- s. 60(1)
- s. 27
- s. 10
- s. 42
- s. 87
- 11
- section 37
- 1002
- 1008
- 1023
- Section 57
- section 4
- section 26
- section 43
- s. 68
- ss. 21
- 22
- 648
- ss. 48
- ss. 7
- s. 19
- section 406
- s. 406
- ss. 4
- s. 4
- 37
- s. 6
- s. 37
- 10
- s. 647
- s. 444
- s. 69
- 1003
- 1028
- s. 771
- s. 57
- Section 10
- section 10
- s. 43
-
- section 63
- section 36
- s. 28
- s. 23
- s. 86
- section 53
- s. 58
- s. 56
- section 13
- s. 13
- s. 50
- section 56
- s. 63
- 12
- 15
- 28
- 30
- 38
- s. 45
- 108
- 59
- 67
- s. 15
- Section 15
- Section 28
- Section 30
- section 28
- section 30
- section 15
-
- ss. 84
- 85
- section 40
- section 35
- sections 34
- 35
- 9
- ss. 3
- s. 3
- section 9
- s. 40
-
- Section 29
- section 65
- s. 128
- 103
- s. 8(8)
- 18
- s. 65
-
Unresolved citations
- section 2
- Paragraph (d)
- paragraph 2(a)
- paragraph 1(b)
- paragraph 3(d)
- paragraph 3(a)
- paragraph 2(d)
- para. 1(c)
- para. 2(a)
- para. 3(a)
- paragraph 2(b)
- para. 3(c)
- para. 3(d)
- para. 5(a)
- para. (b)
- para. (a)
- para. 2(d)
- paragraph (a)
- paragraph (d)
- s. 86
- s. 48
- s. 43
- 103
- s. 10
- s. 28
- s. 15
- section 4 of Opium and Narcotic Drug Act
- (g)
- Section 2 of the Excess Profits Tax Act
- paras. (a)
- section 53 of the Quebec Motor Vehicles Act
- section 406 of The Municipal Act
- s. 406 of the Municipal Act
- section 36 of the Quebec Motor Vehicles Act
- s. 36 of the Quebec Motor Vehicles Act
- paragraph (f)
- (b)
- s. (29)
- s. Section 13 of the Quebec Succession Duty Act