Western Minerals Ltd. v. Minister of National Revenue

ARTY-GEN. Solicitors for the Royal Bank of Canada: McMillan, DSnLAN Binch, Stuart, Berry, Dunn, Corrigan & Howland, Toronto. ""R CE Ritchie J. WORLDWIDE EVANGELIZATION

APPELLANT CRUSADE (CANADA)

(Plaintiff)

Nov. 30 AND

THE CORPORATION OF THE VIL- LAGE OF BEAMSVILLE (Defend- RESPONDENT. ant) .........................

ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO Taxation- Municipal - Missionary training centre

Whether property exempt from municipal taxation as "seminary of learning maintained for philanthropic or religious purposes"--The Assessment Act, R.S.O. 1950, 24, s. 4(5).

The plaintiff, a non-profit evangelical corporation, owned properties in the defendant municipality, which it used for training and preparing persons to be missionaries in foreign fields. The training given consisted of Scripture readings and general religious discussions, and in learning skills considered valuable to missionaries, such as cooking, sewing, motor mechanics, carpentry, etc. There was no fixed curriculum. The plaintiff sued the municipality for a declaration that the properties were exempt from taxation under s. 4(5) of The Assessment Act, which provides exemption from tax for buildings used bona fide "in connection with and for the purposes of a seminary of learning maintained for philanthropic or religious purposes, the whole profits of which are devoted or applied to such purposes". The action was dismissed by the trial judge, and this judgment was affirmed by a majority in the Court Held (Kerwin C.J. and Judson J. dissenting): The plaintiff was entitled to the exemption claimed.

The word "seminary" standing by itself, has no fixed legal meaning. It is not a term of art and its primary meaning is simply a place of education. The proper way to decide whether para. 5 of s. 4 of the Act applied was not to compare the plaintiff's method of instruction with that given in other institutions falling within the description of "seminary of learning", but rather to inquire whether those in attend- Kerwin

C.J. and Locke,

Cartwright, Martland and Judson JJ.

80665-3-4 ance learned to fulfil better and more effectively the religious purpose WORWIDE to which they had dedicated themselves. The evidence showed that that result was achieved.

APPEAL from a judgment of the Court of Appeal for v.A Ontario', affirming a judgment of LeBel J. Appeal allowed, B

.

et al.

THE CHIEF JUSTICE (dissenting):-I agree with the reasons given by Schroeder J.A. The appeal should be dismissed with costs.

CARTWRIGHT J.:-This as an appeal from a judgment of the Court of Appeal for Ontario' dismissing an appeal from a judgment of LeBel J., as he then was, whereby the appellant's action for a declaration that certain property owned by it situate in the respondent village is exempt from taxation was dismissed. Mackay J.A., dissenting, would have allowed the appeal and granted the declaration.

The relevant facts are not in dispute. They are conveniently summarized in the following passage in the reasons of Mackay J.A.:

The Plaintiff is a corporation incorporated by Letters Patent issued pursuant to the provisions of The Ontario Companies Act. The Letters Patent provide that the corporation shall be carried on without the purpose of gain for its members, and that any profit or other accretions to the corporation shall be used in promoting its objects. The purposes and objects of the corporation as set out in the Letters Patent are:

"To train, equip and send missionaries for service in the foreign countries in which the Worldwide Evangelization Crusade operates; to maintain and support such missionaries; to disseminate missionary and spiritual literature and information; and to do all such other things as are incidental or conducive to the attainment of the above objects."

The properties owned by the appellants are two adjoining house properties known as Numbers 127, 133 and 149 King Street, in the Village of Beamsville. The permanent staff, who live on the premises, are Mr. Arthur E. Frid, Canadian Secretary and Executive Officer of the appellant corporation, his wife, who is a former school teacher; Miss Evelyn Thomas, 1 [1957] O.R. 80, 6 D.L.R. (2d) 605.

a former school teacher and also a qualified dietitian, and Miss Annabel Truedson, also a former school teacher, who acts as treasurer and as secretary and assistant to Mr. Frid.

The only purpose for which the premises are said by the appellant t . . be used is for training and preparing candidates for service as missionaries in foreign fields. The students are persons who are either graduates of recognized Bible Schools and ordained for the ministry, or persons who are OF qualified to be ordained, and in addition to these students, missionaries ea. who are former graduates of the institution and who have served as missionaries in foreign fields, are required, when they return to Canada, Cartwright J. on furlough to attend in the dual capacity of students taking a refresher course and as instructors to give instruction and counsel in regard to problems and conditions encountered by them in their work as missionaries, to those students who have not yet served as missionaries.

While there is no fixed curriculum, the staff and all students each morning, for two and a half hours, attend a meeting for Scripture reading and general religious discussion, including the application of the lessons of the Scriptures to practical daily problems of living and working, particularly with relation to missionary work in foreign fields. During the rest of the day the students are given instruction in dietetics, cooking, sewing, motor mechanics and carpentry, a knowledge of such skills being considered necessary to enable them to successfully carry on their work as missionaries in foreign fields under primitive conditions. The minimum length of time the students are required to attend at the institution is six months and the maximum two years. There are no examinations and the length of time the students attend depends on the discretion of the staff, the students being allowed to leave and enter missionary work when the staff feel that they are qualified to do so. The institution is financed by voluntary contributions. The students do not pay any fees or make any payment for board and lodging. The staff do not receive any salaries. The appellant's claim to exemption is based on para. 5 of s. 4 of The Assessment Act, R.S.O. 1950, c. 24, but it will be convenient to set out paras. 4 and 6 of that section also:

80665-3--44

It is conceded that the activities carried on by the appellant in the buildings and grounds for which it claims exemption are "for religious purposes" but the respondent contends that those activities are not such as to bring the appellant's institution within the meaning of the word "a seminary of learning" as used in para. 5.

I agree with the view expressed by Schroeder J.A. that the word "seminary", standing by itself, has not acquired any fixed legal meaning. It is not, in my opinion, a term of art and its primary meaning is simply a place of education. It is, however, argued for the respondent that the phrase ''a seminary of learning" requires as a condition of its application to any institution that the instruction given therein shall be of a higher standard of scholarship and erudition than that given in the appellant's establishment, and shall approximate that given in universities. One difficulty that I have in accepting this argument is that any institution fulfilling the suggested requirements would appear to fall within either para. 4 or para. 6 of s. 4, and para. 5 would become unnecessary.

It appears from uncontradicted evidence that the purpose of those attending the appellant's establishment is to learn how to become missionaries or, in the case of those who are already engaged in that calling, to become better missionaries. It further appears that there has been great success in achieving the desired result. Learning to be better missionaries is no mere by-product or chance result of these persons living and working together in this establishment; it is the primary purpose of their association. That the subjects of their study comprise only the Holy Scriptures and those practical skills useful in the mission field does not, in my opinion, render the word "learning" inapt to describe their activities.

In my opinion, the proper way to decide whether para. 5 is applicable is not to compare the appellant's method of instruction with that given in other institutions which undoubtedly fall within the description of "seminary of learning", but rather to inquire whether those in attendance do learn to fulfil better and more effectively the religious purpose to which they have dedicated themselves.

et al. I have reached the conclusion that the appellant is Cartwright J. entitled to the exemption claimed.

While in view of the difference of opinion in the Courts below I have endeavoured to express my reasons in my own words, I wish also to rest my judgment on the reasons

Mackay J.A. with which I am in full agreement.

Appeal allowed with costs, C.J. and J.

dissenting.

ALEXIS

NIHON

COMPAGNIE

LIMITPE (Defendant) .......

ARTHEM DUPUIS (Plaintiff) ..........

time on, the defendant treated the transactions as sales. The plaintiff sued to recover the difference between the market price obtained by ATiss

NiHoN the defendant less the commission and the price paid to him according Co.

to the schedule, and asked for the cancellation of the contract. The trial judge maintained in part the action and held, inter alia, that the DUUIs addition to the contract had not changed the agency relationship but had only established a floor price. This judgment was affirmed by the Court of Appeal.

Held: The action should be dismissed.

The addition to the contract changed the relationship of the parties from one of agency to one of sale, and the plaintiff had received all that he was legally entitled to receive. The conduct of the plaintiff, after the addition had been made, showed that he was aware that the contract had been basically altered. Oral testimony to the effect that the schedule merely fixed a floor price was not admissible.

APPEAL from a judgment of the Court of Queen's Bench, Appeal Side, Province of Quebec', affirming a judgment of Lalonde J. Appeal allowed.

TASCHEREAU J.:-Le demandeur-intim6 a institu6 contre la d6fenderesse-appelante une action devant la Cour sup6rieure si~geant A Montr6al, dans laquelle il r~clame la r6siliation d'un contrat intervenu entre les parties, l'annulation de nombreuses quittances qu'il aurait consenties, ainsi que la somme de $6,383.78. Cette action a 6t6 maintenue partiellement jusqu'h concurrence de $5,420.41 par l'honorable Juge Lalonde de la Cour sup6rieure qui a, en outre, d~clar6 nuls et non avenus, comme 6tant entach6s de fraude et de dol, tous les rkglements, regus, quittances, donnis par le demandeur a la d6fenderesse, mais n'a pas risilid le contrat. La Cour du banc de la reine', M. le Juge Montgomery dissident, a confirm6 cette d6cision.

Le 5 novembre 1949, l'intim6 a autoris6 par contrat 6crit la compagnie appelante h vendre sur le march6 toute sa production de bois franc (merisier seulement), au prix courant du march6 lors de la vente, sur une base de retenue de 15 pour cent sur le montant total de chaque vente, et d'un escompte de 2 pour cent si les paiements 6taient effectu6s dans les dix jours. Les parties ont convenu de la 1[1958] Que. Q.B. 789.

fagon dont le bois serait sci6, oii il serait empil6 et de quelle manibre on proc6derait au mesurage et A l'inspection. En ce qui concerne le paiement, la compagnie appelante s'est oblig6e de payer A l'intim6 Dupuis, dans les dix jours suivant l'arriv6e des chars h destination, le montant du prix de la vente faite par l'appelante a ses propres clientsTaschereau J. moins la retenue ci-dessus mentionn6e.

Apris la signature de ce contrat, plusieurs livraisons de bois ont 6t6 effectu6es par l'intim6. Dans la suite, A maintes reprises depuis le 5 novembre 1949, 1'appelante a fait des avances h 1'intim6, entre autres, le 11 novembre 1949, le 23 d6cembre de la mime annie, le 16 janvier, le 7 f6vrier et le 15 mai 1950.

Chaque fois que 1'une de ces avances 6tait consentie par 1'appelante A l'intim6, une "addition" au contrat original 6tait faite et sign6e par les parties, et comme consequence de ces additions, et particulibrement de celle du 16 janvier 1950, l'appelante pr6tend qu'elle est devenue l'acheteur du bois que lui livrait 1'intim6, et qu'en cons6quence, elle a assum6 elle-mime les risques des fluctuations du march6 du bois. Il s'ensuivrait, toujours d'apris l'appelante, que ce ne serait plus le premier contrat qui trouverait son application en ce qui concerne le prix A 6tre pay6, mais que les parties devaient 6tre gouvernies par les termes m~mes de ces additions qui devaient dans 1'avenir d6terminer leurs relations juridiques.

Il est admis que le contrat original 6tablissait une relation d'agence entre les parties, et que l'appelante devait vendre le bois de Dupuis l'intim6, au prix courant du march6 lors de la vente, en remettre le produit A 1'intim6 et retenir, pour elle, la commission mentionn6e pric6demment.

Dans ces additions faites au contrat du 5 novembre 1949, nicessit6es apparemment par le fait que la compagnie appelante faisait des avances A l'intim6 sup~rieures A la quantiti de bois livr6, il est stipul6 que l'appelante devenait propri6taire du bois exp6di6, afin qu'il lui soit permis de transporter cette marchandise aux banques, pour obtenir des emprunts sous l'empire de la s. 88 de la Loi des Banques. Mais l'addition du 16 janvier 1950, qui est la troisibme A 6tre faite, comporte A mon sens une port6e beaucoup plus consid6rable que les autres. Cette addition renferme la Arxxs clause habituelle des autres additions, et une autre qui se lit ainsi:

Les prix indiqu6s dans cette entente intervenue entre les parties sont les suivants:

F.A.S...............

Cette convention, par cons6quent, ne fixe pas seulement le prix du bois h ftre livr6 apr~s la date elle a 6t sign6e, soit le 16 janvier 1950, mais 6galement le prix de celui livr6 avant et qui n'a pas encore

4 pay6, car on y trouve les mots suivants: "paiera A Arthem Dupuis pour le bois couvert par le contrat et ses additions".

Le juge de premihre instance a conclu que cette addition au contrat faite le 16 janvier 1950, n'a pas chang6 la nature des liens juridiques qui pouvaient exister entre les parties, c'est-h-dire une relation de principal et d'agent, mais n'a fait qu'6tablir un "plancher" au prix du bois que livrait le demandeur-intim6. Il a 6galement conclu que le contrat d'agence h commission continuait de subsister et que l'appelante devait remettre h 1'intim6 le montant total du prix regu de ses propres acheteurs, toujours en retenant la commission de 15 pour cent plus 2 pour cent d'escompte. II a t6 d'opinion que pour rendre compte h 1'intim6, l'appelante s'est bas6e frauduleusement sur les prix mentionn6s au contrat du 16 janvier 1950, au lieu de se baser sur les montants rdellement pergus des d6biteurs. Parce que l'appelante n'a pay6 que le montant mentionn6 au contrat du 16 janvier 1950, au lieu de rendre compte du prix auquel le bois a t6 r6ellement vendu, il en vient h la conclusion qu'il y a eu fraude de la part de l'appelante.

Mais ce raisonnement du juge au proces ne peut riv6ler la fraude de 1appelante que si 1'addition du 16 janvier 1950 a r6ellement fix6 un "plancher", obligeant tout de mime 1'appelante h payer A 1'intim6 tous les montants que les d6biteurs pourraient verser h 1'appelante, au dessus de ce plancher 6tabli.

est bon de noter que, par le jugement qu'il a rendu, M. le Juge Lalonde n'annule pas la convention ou l'addition faite au contrat original le 16 janvier 1950, qui continuait en consequence lier les parties. Le juge au procks base particulibrement son jugement sur le fait que par les termes mimes de cette addition, le demandeur aurait da recevoir tous les montants sup6rieurs h ce plancher que les d6biteurs de 1'appelante payaient. C'est pricis6ment parce que l'appelante n'a pas donn6 effet h cette interpr6tation faite par M. le Juge Lalonde et qu'un montant moindre a t6 remis, que 1'on pr6tend que 1'appelante s'est rendue coupable de manceuvres frauduleuses en laissant croire A 1intim6 que ses prix mentionn6s h l'"addition" 6taient v6ritablement les prix pergus par 1'appelante.

M. le Juge Casey, qui a 6crit le jugement majoritaire de la Cour du bane de la reine', exprime a peu pris la mime opinion. Il soutient que ce document du 16 janvier 1950 n'6tablit pas de changement dans les relations juridiques des parties, mais comme M. le Juge Lalonde, il croit que son effet a 6t6 d'itablir un "plancher" pour le prix du bois, et que l'intim6 avait droit de percevoir 'exc6dent du prix, fix6 au plancher, s'il en existait un.

Je suis d'opinion que les termes de ce document du 16 janvier 1950 ne pr6sentent pas d'ambiguit6. Ce dernier est en effet bien diff6rent du premier contrat qui en 6tait un d'agence, tandis que le second a fait disparaitre cette relation juridique. Les termes employ6s d'oii d6coule pour les parties une nouvelle relation d'acheteur h vendeur sont complets et non 6quivoques. Ils alt~rent fondamentalement ce qui caract~risait la premibre convention. En effet, ils stipulent qu.'Alexis Nihon Cie Lte paiera 6 Arthem Dupuis pour le bois couvert par le contrat et ses additions, les prix suivants f.a.b. chars St-Paulin, moins 15% de retenue et 2% d'escompte pour paiement dans les dix jours." Le mot "paiera" d6termine n6cessairement un prix fix6 A l'avance f.a.b. chars St-Paulin. Si le prix h 6tre pay6 est f.a.b. chars St-Paulin, il ne peut pas 6tre le prix obtenu h