Alliance Assurance Company Limited et al. v. Dominion Electric Protection Company Limited

ASSURANCE CO. et al.

Pigeon I.

same time, a fire of criminal origin had broken out and caused considerable damage. After the visit, the fire department officer telephoned respondent's local manager, reminding him of the events of the previous year and asking that special attention be given to any call coming from these premises. The following night, a fire broke out and one sprinkler head was activated.

The fire was put out, but an hour passed before the respondent's agents gave the alarm to the firemen who are the only persons authorized to shut off the water. Having received simultaneous signals from the building occupied by Sportland

Shoe and from an adjoining building, the respondent's agent allegedly thought that a sudden rise of pressure only was involved not the release of a sprinkler head. Instead of alerting the firemen immediately, he waited to have men available. These men were not told to pay special attention to Sportland Shoe. Therefore, they went first to the other building and found nothing unusual. It is only later, nearly an hour after the signals were received, that they finally found out what had happened and called the firemen.

Under their contracts with Sportland Shoe, the appellants were forced to indemnify it for damages amounting to nearly $50,000. They obtained subrogation and sued the respondent jointly. The latter pleaded absence of fault and of privity.

In the Superior Court, Brossard J. ruled that the respondent had committed a fault by not taking, immediately upon receipt of the signals, the necessary steps to check the situation immediately and, if these could not be taken at once, by failing to notify the fire department without delay. He considered that this fault made respondent liable towards Sportland Shoe despite the absence of privity of contract and he estimated the damages therefrom at half the total damage, namely at $22,484.70.

The Court of Appeal' reversed this judgment.

The essential reasons for the decision rendered

1'ann6e pric6dente, A la m~me 6poque, un incendie d'origine criminelle s'6tait d6clar6 et avait caus6 des dommages consid6rables. La visite terminie, le pr6pos6 du service des incendies fait un appel t616phonique au g6rant local de l'intimbe, lui rappelle les 6v6nements de l'ann6e pr6cidente et demande qu'on apporte une attention particulibre A tout appel venant de ces lieux. Dans la nuit qui suit, un incendie se d6clare, un gicleur se d6clenche et 1'6teint mais il s'6coule une heure avant que les prdpos6s de l'intimde alertent les prompiers auxquels seuls il appartient d'arrter 1'6coulement de l'eau. Ayant regu simultandment des signaux venant du batiment occup6 par Sportland Shoe et d'un immeuble voisin, le pr6pos6 de l'intimbe aurait cru qu'il s'agissait seulement d'une hausse subite de pression et non d'un d6clenchement de gicleur. Au lieu d'alerter imm6diatement les pompiers, il attend d'avoir des hommes disponibles. Ces derniers ne sont pas pr6venus qu'il y a lieu de porter une attention speciale A la Sportland Shoe. Ils s'en vont donc d'abord A l'immeuble voisin et n'y trouvent rien d'anormal. Ce n'est qu'ensuite, prbs d'une heure apris la r6ception des signaux, qu'ils constatent enfin ce qui s'est produit et priviennent les pompiers.

En vertu de leurs contrats avec Sportland Shoe les appelantes sont tenues de l'indemniser des d6gits qui s'6livent A prbs de $50,000. Elles obtiennent la subrogation et intentent une poursuite conjointe contre l'intim6e.

Celle-ci plaide absence de faute et de lien de droit. En Cour sup6rieure, le juge Brossard a statu6 que l'intimbe avait commis une faute en ne prenant pas imm6diatement sur r6ception des signaux les dispositions n6cessaires A une v6rification imm6diate de la situation et, faute de ne pouvoir les prendre imm6diatement, en ne pr6venant pas sans d6lai le service des incendies. II a consid6r6 que cette faute engageait la responsabilit6 de l'intim6e envers Sportland Shoe malgr6 l'absence de lien contractuel et il a estim6 les dommages en d6coulant A la moiti6 du pr6judice total, soit a $22,484.70.

La Cour d'appell a infirm6 ce jugement. Les motifs essentiels de l'arrt prononc6 par le juge Co. et al.

ALLIANCE ASSURANCE Co. et al.

Le Juge Pigeon by the Chief Justice of the Province and upon which his four brothers were in agreement were as follows:

It seems clear to me that the learned trial Judge was right in disregarding the contract between Dominion Electric and Mrs. Fischler. Sportland was not a party to this contract and neither it nor its transferees could invoke it.

It seems clear to me also that an omission may constitute a fault, but only when there is an obligation to act, that is, to perform, either acts prescribed by the law, or acts that must be considered obligatory in view of necessary human relations (Carpentier et du Saint, R6pertoire g6ndral, tome XXXII, vis

Responsabilit6 civile, no 343, p. 883).

In the case at bar, the delay was due in the first place to a faulty interpretation of the signal received and then to the fact that Dominion Electric's employees first checked the building next to the one occupied by Sportland Shoe. Did Dominion Electric have the civil obligation towards Sportland Shoe of calling the firemen as soon as the signal was received and to check first the premises of Sportland Shoe?

It seems to me that this obligation is imposed neither by law, nor by necessary human relations. It seems to me that a citizen who knows, by some means, that a sprinkler system has been activated in two buildings is under no civil obligation to call the firemen and to go and check one building instead of the other.

If Dominion Electric had this civil obligation, it could only be by virtue of the promise made by its manager Neely, during his conversation with Captain

Rowe on July 5, 1957. But then, we are out of the field of offenses or quasi-offenses. It is an obligation that Dominion Electric would have assumed through its manager. But the learned trial Judge found that this conversation did not constitute a contract and

I think he is right. To his reasons, I will add the following: the evidence shows without contradiction that Neely did not have the authority to bind

Dominion Electric by contract.

My conclusion is that Dominion Electric did not commit any fault towards Sportland Shoe because it had no obligation to perform the act it is blamed for not doing. The facts of the case at bar are not unlike those which led to our judgment in Banque de Montrial v. Boston Insurance Company (1963,

Q.B. 487) affirmed by the Supreme Court of Canada (1964, S.C.R. v).

en chef de la Province et sur lesquels ses quatre colligues ont 6t6 d'accord sont comme suit: Il me parait clair que le premier juge a raison d'6carter le contrat pass6 entre Dominion Electric et madame Fischler. Sportland n'est pas partie h ce contrat et ni elle ni ses cessionnaires ne peuvent l'invoquer.

Il me parait clair aussi que l'omission peut constituer une faute, mais seulement lorsqu'il y a obligation d'agir, faire, soit des actes prescrits par la loi, soit des actes que les rapports n6cessaires des hommes doivent faire considdrer comme obligatoires> (Carpentier et du Saint, R6pertoire g6ndral, tome XXXII, vis Responsabilit6 civile, no 343, p. 883).

Dans le cas pr6sent, le retard est di d'abord A une mauvaise interpr6tation du signal regu et ensuite au fait que les employds de Dominion Electric ont v6rifi6 d'abord I'immeuble voisin de celui de Sportland Shoe. Dominion Electric avait-elle envers Sportland Shoe l'obligation civile d'alerter les pompiers d6s la r6ception du signal et de v6rifier d'abord I'6tablissement de Sportland Shoe? Il me semble que cette obligation ne lui est imposde ni par la loi, ni par rapports n6cessaires des hommesD. Il me semble qu'un citoyen qui a connaissance, par un moyen quelconque, qu'un systhme de gicleurs automatiques se d6clenche dans deux immeubles n'est pas civilement tenu d'alerter les pompiers et d'aller v6rifier un immeuble plut6t que l'autre. Si Dominion Electric avait cette obligation civile, ce ne peut 8tre qu'en vertu de l'engagement contract6 par son directeur Neely lors de sa conversation avec le capitaine Rowe le 5 juillet 1957. Mais alors, nous sommes sortis du domaine d6lictuel ou quasi-d6lictuel. C'est une obligation que Dominion Electric aurait assumde par son directeur. Or, le premier juge prononce que cette conversation ne constitue pas un contrat. Je crois qu'il a raison. Aux motifs qu'il donne j'ajouterai celui que la preuve d6montre sans contradiction que Neely n'avait pas le pouvoir de lier Dominion Electric par contrat.

Je conclus que Dominion Electric n'a commis aucune faute envers Sportland Shoe parce qu'elle n'avait aucune obligation d'accomplir l'acte qu'on lui reproche d'avoir omis.

Les faits de la pr6sente cause se rapprochent de ceux qui donnbrent lieu a notre arrit Banque de Montrial v. Boston Insurance. Company (1963, B.R. 487) confirm6 par la Cour supreme du Canada (1964, R.C.S. v).

et al..

I must say at first that it does not seem quite certain to me that Sportland Shoe and its transferees cannot invoke the contract between Mrs.

Fischler and the respondent. However, it is not necessary to decide if Sportland Shoe actually did make itself responsible for the contract without getting this benefit because, even if it could take advantage of it, the following clause would bar the claim:

I fail to see how in proceedings based on the contract we could avoid giving effect to this stipulation of nominal damages just as, in general, we must give effect to a stipulation of exemption from liability: Glengoil Steamship Co. v. Pilkington . There is no question here of gross negligence as in the case of Canada Steamship Lines

Ltd. v. The King . It is equally clear that the telephone conversation did not create a separate agreement exempt from the conditions of the contract with Mrs. Fischler.

The only question therefore is whether the

Court of Appeal was right in excluding the quasidelictual liability on which the trial Judge based his decision. In his judgment, the latter said:

Towards Mrs. Fischler, on the one hand, and Sportland Shoe, on the other, the defendant and its agents were in the same situation as the driver of an automobile towards his employer with whom he has contractual obligations, on the one hand, and third parties, motorists or pedestrians, on the other hand, to whom he has an obligation of care.

With deference to the learned Judge, the comparison is inaccurate, I must say. The obligation of the driver of an automobile towards third parties, or more accurately the duty of care

(1897), S.C.R. 146.

* [1952] A.C. 1 E.R. 2 D.L.R. 786,

5 W.W.R. (N.S.) 609.

Je dois dire d'abord qu'il ne me parait pas tout A fait certain que Sportland Shoe et ses cessionnaires ne peuvent pas invoquer le contrat entre Madame Fischler et l'intim6e. Il n'est pas n6cessaire cependant de rechercher si vraiment Sportland Shoe a pris la charge du contrat sans ce bin6fice car, mime si elle pouvait s'en pr6valoir, la clause suivante ferait obstacle A la r6clamation:

Je ne vois pas comment sur une poursuite fond6e sur le contrat nous pourrions ne pas donner effet & cette stipulation d'un montant nominal de dommages tout comme il faut en principe dormer effet & une stipulation de nonresponsabilit6: Glengoil Steamship Co. c. Pilkington . Il n'est pas question qu'il y ait ici faute lourde comme dans l'affaire Canada Steamship Lines Ltd. v. The King . Il est 6galement clair que la conversation t6l6phonique n'a pas donn6 naissance h une convention distincte affranchie des conditions du contrat avec Madame Fischler. II faut donc, par cons6quent, rechercher uniquement si la Cour d'appel a d bon droit 6cart6 la responsabilit6 quasi-d6lictuelle sur laquelle le juge de premire instance avait bas6 sa d6cision. Dans son jugement, ce dernier dit:

Par rapport a Madame Fischler, d'une part, et i la Sportland Shoe, d'autre part, la d6fenderesse et ses pr6pos6s 6taient dans une situation identique A celle d'un conducteur d'automobile par rapport, d'une part, A son employeur envers lequel il a des obligations contractuelles et, d'autre part, envers les tiers, automobilistes ou pi6tons, envers lesquels il a une obligation de prudence.

Avec d6f6rence pour le savant juge, il me faut dire que la comparaison est inexacte. L'obligation du conducteur d'automobile envers les tiers, ou plus exactement le devoir de pruco. et al..

Pigeon et al.

Le Juge Pigeon lying upon him, is unmistakably established by law. Here, on the contrary, it appears to me that the Court of Appeal is right in holding that the respondent did not have a legal obligation to perform the act it is blamed for not doing, namely to call the firemen promptly on reception of the signals coming from the premises of

Sportland Shoe. The respondent is not a public service charged with the duty of watching over a whole district generally, it is a private enterprise which assumes the obligation of surveillance of an establishment through an electrical system only towards those who subscribe to its service. The duty it is blamed for not performing and by reason of which it is alleged to have committed a fault involving liability is not one which falls on everybody; on the contrary, it is solely a contractual obligation.

It is true that the existence of contractual relations does in no way exclude the possibility of a delictual or quasi-delictual obligation arising out of the same fact. However, it is necessary for this that all the elements required to give rise to such responsibility should be found. Obviously, a fault is the first of these elements. For a fault to exist, it is essential, as appears from the wording of art. 1053 C.C., that there be either a positive damaging and non-justifiable act or the omission to perform a duty towards the injured party.

At the hearing, as in a prolix factum, a great many cases and authors were quoted to demonstrate that -a duty a breach of which is a fault may exist without an explicit legal provision proclaiming its existence. This is not doubtful but does not mean that we should consider as such a duty an obligation that does not arise from the law but solely from a contract with a third party.

As the Court of Appeal rightly pointed out, such a concept of civil responsibility might result in creating in favor of third parties, who are strangers to the contract, obligations more onerous than those enuring therefrom to the contracting party. This would happen whenever an exclusion or limitation of liability is stipulated.

dence qui lui incombe, est 6tablie de fagon incontestable par la loi. Ici, au contraire, il me parait que la Cour d'Appel a raison de dire que l'intim6e n'avait pas par la loi l'obligation de faire ce qu'on lui reproche d'avoir omis, c'est-h-dire pr6venir avec diligence les pompiers d6s la r6ception de signaux provenant de 1'6tablissement de Sportland Shoe. L'intim6e n'est pas un service public charg6 de surveiller g6ndralement tout un secteur, elle est une entreprise priv6e qui ne contracte l'obligation de surveillance d'un 6tablissement par le truchement d'une installation 6lectrique qu'A l'6gard de celui qui s'abonne h son service. Le devoir qu'on lui reproche d'avoir omis de remplir et en raison duquel on pr6tend qu'elle a commis une faute gdniratrice de responsabilit6 n'est pas de ceux qui incombent & tous, c'est au contraire uniquement une obligation contractuelle dont elle est charg6e.

II est vrai que 'existence de relations contractuelles n'exclut aucunement la possibilit6 d'une obligation d6lictuelle ou quasi-d6lictuelle d6coulant du mime fait. Encore faut-il pour que cela soit possible que se rencontrent tous les 616ments requis pour donner naissance A cette dernibre responsabilit6. Le premier de ces 616ments est 6videmment une faute. Pour qu'il y ait faute, il est essentiel comme cela d6coule du texte de l'art. 1053 C.C., qu'il y ait soit un fait positif dommageable et non justifiable, soit I'omission d'accomplir un devoir envers la partie 16s6e. A 1'audition, comme dans un factum prolixe, on nous a cit6 beaucoup de jurisprudence et de doctrine pour d6montrer qu'un devoir dont la violation constitue une faute peut fort bien exister sans qu'un texte formel en proclame l'existence. Cela n'est pas douteux mais ne signifie aucunement qu'il y a lieu de considdrer comme un tel devoir une obligation qui ne d6coule pas de la loi mais uniquement d'un contrat avec un tiers.

Comme la Cour d'appel l'a fait A bon droit observer, cette dernibre conception de la responsabilit6 civile signifierait qu'envers les tiers qui ne sont pas parties au contrat, celui-ci pourrait imposer des obligations plus lourdes que celles qui en d6coulent en faveur du contractant. II en serait ainsi chaque fois qu'on y trouve une exclusion ou une limitation de responsabilit6. et al. ELECTRIC

Many cases were cited respecting the responsibility of the manufacturer of a dangerous product towards persons who did not contract with him. In such cases, the source of the responsibility is the breach on the duty lying upon the manufacturer not to put such things on the market and this duty is independent of his contractual obligation, as vendor: Ross v. Dunstall .

The same observation applies to the owner of a leased building towards persons admitted to the premises by the lessee. The responsibility for damages resulting from a defective condition rests with him as owner and exists independently of his contractual obligations as lessor. Examples could be multiplied and in every case where quasi-delictual responsibility has been held to exist, it will be found that its basis is the existence of a duty other than one deriving solely from a contractual obligation.

The appeal must be dismissed with costs. This dismissal is adjudged on the merits because, at the start of the hearing, leave to appeal was granted without costs to the appellants; their appeal as of right was ill-founded because the amount in controversy is to be considered separately for each, however respondent on his part had failed to move to quash for that reason.

Appeal dismissed with costs.

&

O'Donnell, Montreal.

Monette, Filion, Clerk, Michaud, Barakett &

Livesque, Montreal.

On nous a cit6 de nombreux arr~ts touchant la responsabilit6 du manufacturier d'une chose dangereuse envers des personnes qui n'ont pas contract6 avec lui. En pareil cas, la source de la responsabilit6 est le manquement au devoir que l'on reconnait au manufacturier de ne pas mettre de telles choses sur le march6 et ce devoir est ind6pendant de son obligation contractuelle de vendeur: Ross c. Dunstall'. Il en va de m8me pour le propridtaire d'un immeuble loud envers les personnes que le locataire y regoit. La responsabilit6 du dommage d6coulant d'un 6tat d6fectueux lui incombe comme propridtaire de la chose et elle existe ind6pendamment de ses obligations contractuelles de bailleur. On pourrait multiplier les exemples et dans tous les cas oh la responsabilit6 quasi-d6lictuelle a 6t6 retenue l'on constaterait que le fondement en est l'existence d'un devoir autre que celui qui d6coule uniquement d'une obligation contractuelle.

L'appel doit 6tre rejet6 avec d6pens. Ce rejet est prononc6 sur le fond car, au d6but de l'audition la permission d'appeler a 6t6 accord6e sans frais aux appelantes; leur pourvoi de plein droit 6tait irrecevable vu que le montant en litige doit 6tre consid6r6 s6par6ment pour chacune mais l'intim6e de son c6t6 avait omis d'en demander le rejet pour ce motif.

Appel rejetd avec ddpens.

Procureurs des demanderesses, appelantes: Tansey, de Grandprd, Bergeron, Monet, Lavery & O'Donnell, Montrial.

Procureurs de la ddfenderesse, intimde: Monette, Filion, Clerk, Michaud, Barakett & Livesque, Montrial.

R.C.S. D.L.R.

Co. et al. ELECTRIC

Pigeon

[19701 S.C.R. A

Breckenridge Speedway Ltd., Twin Town Motors

Ltd., Oscar Green and Irene Janet Green carrying on business under the firm name and style of

Green's Garage and the said Irene Janet Green and the said Green's Garage (Plaintiffs)

Appellants;

and

Her Majesty The Queen in Right of Alberta

(Defendant)

Respondent;

and

Intervenant.

1968: November 8, 12, 14; 1969: October 21.

Present: Cartwright C.J. and Fauteux, Abbott, Martland, Judson, Ritchie, Hall, Spence and Pigeon JJ.

Spence et Pigeon.

Constitutional law-Right to recover funds advanced by Treasury Branch-Validity of agreement to transfer properties either by way of partial payment or as security for payment-Plea of ultra vires

-Money had and received-The Treasury Branches

Act, R.S.A. 1955, c. 344.

By an agreement made with the Provincial Treasurer of Alberta, with respect to accounts at the

Calder Treasury Branch, the plaintiffs, OG, IG and B Ltd., agreed to transfer certain properties to the Provincial Treasurer. The Provincial Treasurer agreed to allow credit on the account of B Ltd., and

G's Garage account with the Calder Treasury

Branch for the amount shown on the transfers of certain of the properties. The Provincial Treasurer also agreed to lease back three of the properties for a 5-year term, at a rent equivalent to interest at 6 per cent on the values shown in the transfers, plus annual taxes. The plaintiffs, in respect of these properties, were to have the right to make additional payments, above the stipulated rental, to be applied toward the purchase back of the properties for the amounts set.out in the transfers.

The plaintiffs alleged various breaches of this agreement upon the basis of which they sought rescission of the agreement, the return of the various properties, and repayment of moneys received by the defendant pursuant to the agreement.

Breckenridge Speedway Ltd., Twin Town Motors: Ltd., Oscar Green et Irene Janet Green, en affaires sous les nom et raison sociale de Green's Garage, et lesdits Irene Janet Green et Oscar Green (Demandeurs) Appelants;

et

Sa Majest6 la Reine du Chef de l'Alberta (Difenderesse) Intimde;

et

Le Procureur g6nbral du Canada

Intervenant.

1968: les 8, 12 et 14 novembre; 1969: le 21 octobre. Pr6sents: Le Juge en Chef Cartwright et les Juges Fauteux, Abbott, Martland, Judson, Ritchie, Hall, Droit constitutionnel-Droit au recouvrement de sommes avancies par la Treasury Branch-Validitd de la convention par laquelle des propridtis sont transporties soit i titre de paiement partiel soit en garantie de paiement-Alldgation d'inconstitutionnalitS-Sommes en tant qu'argent regu-The Treasury Branches Act, S.R.A. 1955, c. 344.

Par la convention intervenue entre le tr6sorier de la province d'Alberta, au sujet de comptes A la Calder Treasury Branch, les demandeurs, OG, IG et B Ltd., ont convenu de transporter au trdsorier de la province un nombre de propri6tds. Le tr6sorier de la province s'est engag6 h louer aux demandeurs trois de ses propri6t6s pendant cinq ans, moyennant un loyer 6gal h l'intdrit au taux de 6 pour-cent l'an sur la valeur des propri6t6s 6tablie aux actes de transport plus les taxes annuelles. Les demandeurs avaient le privilige de faire des paiements sup6rieurs au loyer ainsi d6termin6 pour racheter ces propridtds aux prix 6tablis par les diff6rents actes de transport.

Les demandeurs ont alldgu6 l'inex6cution de la convention sous plusieurs rapports et, en consdquence, en ont demand6 la rdsolution et r6clam6 la r6trocession des propri6t6s et le remboursement des sommes qu'ils avaient vers6es A la d6fenderesse en vertu de cette convention.

Fl9701 R.C.S.

The defendant counterclaimed for moneys owing by OG and IG for rentals due under the leases of the properties covered by the agreement, and against G's Garage and B Ltd., on a promissory note given by the former, and for the amounts due on their current accounts by both of them.

The plaintiffs, in their statement of defence to the counterclaim, alleged that all acts performed and agreements entered into by the defendant, relevant to the action, were invalid because they were entered into pursuant to The Treasury Branches Act, R.S.A.

1955, c. 344, and that the Act was ultra vires of the

Legislature of Alberta.

The trial judge's finding that the complaints made by the plaintiffs did not support a claim for damages, nor for rescission, was supported unanimously by the Appellate Division. With respect to the counterclaim, the majority of the Appellate Division were of the opinion that the plaintiffs, as borrowers, were not entitled, in answer to a claim for payment by the defendant, to set up the constitutional invalidity of The Treasury Branches Act as a defence. Accordingly, they did not consider it necessary to decide that issue. All of the members of the Court, with one exception, were of the view that some of the transfers of property made pursuant to the agreement represented partial payments of indebtedness, but that the transfers of the properties which had been leased back, were given as securities for payment and not as partial payment. In -the result, the judgment at trial dismissing the plaintiff's claim and allowing the defendant's counterclaim, was varied by striking out that portion of the judgment which had ordered that the defendant recover possession of those three properties. The plaintiffs appealed and the defendant cross appealed to this

Court.

Held (Hall and Spence JJ. dissenting in part):

The appeal and cross-appeal should be dismissed.

Per Cartwright C.J. and Fauteux, Abbott, Martland, Judson, Ritchie and Pigeon JJ.: Even if the contention were valid that The Treasury Branches

Act was unconstitutional, as relating to banking, a matter assigned exclusively to the Parliament of

Canada, and that the Provincial Treasurer had no legal authority to lend to the plaintiffs the funds which, in fact, were advanced to them, the authorities made it clear that, there being nothing illegal about the transaction, but at most, lack of authority in the Provincial Treasurer to make the advance, the plaintiffs would have no answer to an action for

Par demande reconventionnelle, la d6fenderesse a r6clam6 des demandeurs OG et IG en paiement des sommes dues en vertu des baux relatifs aux propri6t6s vis6es par la convention et de Green's Garage et de B Ltd. le paiement d'un billet A ordre souscrit par le premier de m~me que le remboursement de leur d6couvert de compte.

Les demandeurs ont pr6tendu, dans leur d6fense, h la demande reconventionnelle, que tous les actes et conventions de la d6fenderesse vis6s A l'action 6taient nuls parce que faits en vertu de la loi dite The Treasury Branches Act, S.R.A. 1955, c. 344, et que cette Loi 6tait ultra vires des pouvoirs de la L6gislature d'Alberta.

La Cour d'appel a confirm6 & l'unanimit6 la conclusion du juge de premibre instance que les pr6tentions des demandeurs ne justifiaient pas un recours en dommages ou en r6solution. Quant A la demande reconventionnelle, la majorit6 des juges de la Cour d'appel ont &t6 d'avis que les demandeurs en tant qu'emprunteurs, n'avaient pas le droit d'invoquer l'inconstitutionnalit6 de la Loi comme moyen de d6fense, En cons6quence, ils n'ont pas cru n6cessaire d'adjuger sur cette question. Tous les juges de Ia Cour d'appel, A l'exception d'un, ont opin6 que les transports de propri6t6s faits en ex6cution de la convention constituaient un paiement partiel de la dette des demandeurs, sauf que ceux des propri6t6s qu'on leur avait lou6es n'avaient &t donn6s qu'en garantie et non en paiement partiel. En cons6quence, la Cour d'appel a modifi6 le jugement de premibre instance qui rejetait I'action des demandeurs et accueillait la demande reconventionnelle de la dfenderesse en biffant du jugement la disposition qui autorisait la d6fenderesse h prendre possession de ces trois propri6t6s. Les demandeurs en appelbrent a cette Cour et la d6fenderesse a produit un contreappel.

Arrit: L'appel et le contre-appel doivent 8tre rejetis, les Juges Hall et Spence 6tant en partie dissidents.

Le Juge en Chef Cartwright et les Juges Fauteux, Abbott, Martland, Judson, Ritchie et Pigeon: M~me si la pr6tention 6tait fond6e que la loi The Treasury Branches Act 6tait inconstitutionnelle, parce qu'elle se rapporte au commerce de banque, qui est de la comp6tence exclusive du Parlement du Canada, et que le tr6sorier de la province n'avait pas, en droit, le pouvoir de priter aux demandeurs les sommes que de fait il leur a avanc6es, la jurisprudence d6montre clairement que, comme la transaction n'avait rien d'ill6gal et que tout au plus le tr6sorier de la province n'avait pas le pouvoir de faire cr6dit, les