Dorion,
C.J.
(dissenting)
:—
Nine
cases
have
been
submitted
to
us
in
order
to
test
the
legality
of
taxes
imposed
by
an
Act
passed
by
the
Legislature
of
the
Province
of
Quebec,
in
the
45th
year
of
Her
Majesty’s
reign,
under
ch.
22,
and
entitled
‘‘An
Act
to
impose
certain
direct
taxes
on
certain
commercial
corporations.^
The
first
section
of
this
Act
which
imposes
the
taxes
claimed
by
these
several
actions,
is
in
the
following
terms
:—
1.
"‘In
order
to
provide
for
the
exigencies
of
the
public
service
of
this
Province,
every
Bank
carrying
on
the
business
of
Banking
in
this
Province,
every
Insurance
Company
accepting
risks
and
transacting
the
business
of
insurance
in
this
Province,
every
incorporated
company
carrying
on
any
labor,
trade
or
business
in
this
Province,
every
incorporated
Loan
Company
making
loans
in
this
Province,
every
incorporated
Navigation
Company
running
a
regular
line
of
steamers,
steamboats
or
other
vessels
in
the
waters
of
this
Province;
every
Telegraph
Company
working
a
telegraph
line
or
part
of
a
telegraph
line
in
this
Province;
every
Telephone
Company
working
a
telephone
line
in
this
Province;
every
City
Passenger
Railway
or
Tramway
Company
working
a
line
of
railway
or
tramway
in
this
Province,
shall
annually
pay
the
several
taxes
mentioned
and
specified
in
section
three
of
this
Act,
which
taxes
are
hereby
imposed
upon
each
of
such
commercial
corporations
respectively.’’
Section
3
says,
the
annual
taxes
imposed
upon
and
payable
by
the
commercial
corporations
mentioned
in
section
1
shall
be,
on
Banks
*
*
*
$1,000
when
the
paid-up
capital
is
from
$500,000
to
$1,000,000,
and
an
additional
sum
of
$200
for
each
million
or
fraction
of
a
million
dollars
of
the
paid-up
capital
from
one
million
to
three
million
dollars,
and
a
further
additional
sum
of
$100
for
each
million
or
fraction
of
a
million
dollars
of
the
paid-up
capital
over
three
million
dollars,
and
an
additional
tax
of
$100
upon
each
office
in
the
cities
of
Montreal
and
Quebec,
and
$20
for
each
office
in
any
other
place.
By
the
subsequent
provisions
of
this
Act,
these
taxes
are
payable
annually,
and
the
recovery
can
be
made
on
behalf
of
Her
Majesty,
and
by
section
10
these
taxes
are
to
form
part
of
the
consolidated
revenue
of
the
Province.
Of
the
nine
cases
under
consideration,
which
have
all
been
instituted
by
the
Revenue
Inspector
for
the
District
of
Montreal,
five
are
against
Banks,
and
the
others
against
an
Insurance
Company,
a
Manufacturing
Company,
a
Railway
and
Navigation
Company,
and
the
ninth
against
a
Navigation
Company.
Of
these,
six
were
incorporated
either
by
the
Dominion
Parliament
or
before
the
passing
of
the
British
North
America
Act,
1867:
one
was
incorporated
in
England,
and
two
in
the
United
States.
Three
have
their
principal
offices
in
the
Province
of
Quebec,
and
the
others
have
their
principal
offices
out
of
the
Province,
but
they
are
all
doing
business
in
the
Province
of
Quebec.
The
stock
in
three
of
the
companies
is
held
by
parties
residing
out
of
the
Province,
and
in
the
others
by
parties
a
portion
of
whom
reside
in
the
Province,
while
the
other
portion
reside
out
of
the
Province.
In
the
five
Bank
cases
the
actions
have
been
dismissed
by
Mr.
Justice
Rainville,
and
in
the
four
others
they
have
been
maintained
by
Mr.
Justice
Jette
and
Mr.
Justice
Mathieu.
These
nine
cases
form
part
of
a
larger
number
of
cases
now
pending
against
other
corporations
for
the
recovery
of
similar
taxes,
and
have
been
represented
at
the
hearing
as
indicating
the
different
classes
into
which
the
whole
of
the
cases
may
be
divided
according
to
the
special
circumstances
of
each
ease.
I
may
at
once
say
that
I
do
not
find
that
these
special
circumstances
are
such
as
to
take
any
of
the
cases
out
of
the
rule
which
I
think
is
applicable
to
all
of
them.
The
question,
and
the
only
question,
to
be
decided,
as
stated
in
the
admissions
given
in
several
of
these
cases,
is,
whether
or
not
the
Provincial
Legislature
had
authority
to
pass
the
Act
45th
Vict.,
c.
22,
and
to
impose
the
taxes
sought
to
be
recovered.
Mr.
Justice
Rainville,
relying
principally
on
arguments
drawn
from
the
decisions
rendered
in
the
United
States,
has
ruled
in
the
five
Bank
cases,
that
the
present
tax
was
not
a
direct
tax
within
the
meaning
of
the
British
North
America
Act,
1867,
that
the
Provincial
Legislature
had
no
authority
to
impose
such
a
tax,
and
as
a
consequence
he
has
dismissed
the
five
actions.
Mr.
Justice
Jetté
and
Mr.
Justice
Mathieu,
rejecting
the
authority
of
American
decisions,
as
inapplicable
to
the
present
cases,
inasmuch
as
the
words
‘‘direct
taxes”
in
the
American
constitution
are
controlled
and
limited
in
their
application
by
the
obligation
imposed
upon
Congress
to
apportion
such
‘‘
direct
taxes’’
in
proportion
to
the
census,
and
relying
principally
on
the
opinions
expressed
by
French
writers
on
political
economy,
have
come
to
an
opposite
conclusion
and
declared
that
the
legislature
in
imposing
the
present
tax
had
acted
within
the
limits
of
its
authority.
Now,
without
rejecting
altogether
the
assistance
which
may
be
derived
from
a
careful
examination
of
the
decisions
rendered
on
this
question
of
direct
taxation
by
the
eminent
jurists
who,
sitting
in
the
Supreme
Court
of
the
United
States,
have
had
to
give
an
interpretation
to
those
words,
as
found
in
the
Constitution
of
their
country,
nor
the
valuable
opinions
expressed
by
political
economists
as
to
the
meaning
of
those
words,
I
do
not
think
that
either
of
those
standards
is
a
satisfactory
one
in
the
present
cases.
It
cannot
be
denied
that
the
words
4
direct
taxes,’’
in
the
Constitution
of
the
United
States,
cannot
apply
to
some
of
the
taxes
which
are
elsewhere
considered
as
direct
taxes,
and
that
they
were
therefore
used
in
a
limited
sense
in
the
Constitution
of
the
United
States.
Chief
Justice
Chase,
in
the
case
of
Veazie
Bank
v.
Fenno
(8
Wallace,
533,)
after
a
careful
review
of
the
judicial
decisions
and
of
the
opinions
of
jurists
and
others,
came
to
the
following
conclusions
:—
"
"
It
may
be
rightly
affirmed,
therefore,
that
in
the
practical
construction
of
the
Constitution
by
Congress,
direct
taxes
have
been
limited
to
taxes
on
land
and
appurtenances,
and
taxes
on
polls
or
capitation
taxes.”
And
the
same
learned
judge
further
says
:—
"‘It
may
be
safely
assumed,
therefore,
as
the
unanimous
judgment
of
the
Court,
that
a
tax
on
carriages
is
not
a
direct
tax.
And
it
may
further
be
taken
as
established
upon
the
testimony
of
Paterson,
that
the
words
‘direct
taxes,’
as
used
in
the
Constitution,
comprehended
only
capitation
taxes
and
taxes
on
land,
and
perhaps
taxes
on
personal
property
by
general
valuation
and
assessment
of
the
various
descriptions
possessed
within
the
several
States.’’
(8
Wallace,
p.
546.)
Judge
Cooley,
on
Taxation,
p.
5,
note
2,
also
says
:—
"The
term
‘direct
taxation’
is
employed
in
a
peculiar
sense
in
the
Constitution,
in
the
provision
requiring
such
taxes
to
be
apportioned
according
to
representation,
and
they
are,
perhaps,
limited
to
capitation
and
land
taxes
and
Kent,
vol.
1,
p.
255,
says:
‘‘The
Constitution
contemplated
no
taxes
as
direct
taxes,
but
such
as
Congress
could
lay
in
proportion
to
the
Census.
’
’
On
the
other
hand,
there
is
a
great
diversity
of
opinion
among
jurists
and
writers
on
political
economy,
not
only
as
to
what
taxes
are
to
be
considered
as
direct
taxes,
but
even
as
to
the
definition
of
what
constitutes
a
direct
tax.
Merlin,
Répertoire,
vo.
Contributions
Publiques,
sec.
1,
says:
i(
Les
contributions
indirectes
sont
suivant
la
définition
qu
f
en
donne
la
loi,
en
forme
d’instruction,
du
8
janvier
1790,
tous
les
impôts
assis
sur
la
fabrication,
la
vente,
le
transport
et
Vintroduction
de
plusieurs
objets
de
commerce
et
de
consommation,
impôts
dont
le
produit
ordinairement
avancé
par
le
fabriquant,
le
marchand,
ou
le
voiturier
est
supporté
et
indirectement
payé
par
le
consommateur."
u
D’après
cette
définition
les
droits
d’enregistrement
(the
droits
d’enregistrement
include
and
are
chiefly
composed
of
the
duties
levied
on
the
conveyance
of
real
estate
whether
by
inheritance
or
otherwise)
"‘ne
devrai
pas
être
considérés
comme
des
impositions
indirectes,
cependant
on
s
9
est
habitué
à
les
ranger
dans
cette
classe.’’
"C’est
aussi
à
cette
classe
qu’appartiennent
les
droits
de
douane,
les
droits
sur
le
tabac,
sur
les
cartes
à
jouer,
sur
le
sel,
sur
les
boissons,
etc.”
Say,
Traité
d’Economie
Politique,
p.
521,
has
the
following
passage:—"‘On
peut
ranger
sous
deux
chefs
principaux
les
différents
manières
qu’on
emploie
pour
atteindre
les
revenus
des
contribuables.
Ou
bien
on
leur
demande
directement
une
portion
du
revenu
qu’on
leur
suppose:
c’est
l’objet
des
contributions
directes;
ou
bien
on
leur
faite
payer
une
somme
quelconque
sur
certaines
consommations
qu’ils
font
avec
leur
revenu:
c’est
l’objet
de
ce
que
l’on
nomme
en
France
les
contributions
indirectes.
’
’
This
writer
places
among
the
direct
taxes,
‘‘la
contribution
foncière,
la
contribution
mobilière
et
les
patentes,
"
and
among
the
contributions
indirectes,
‘‘les
droits
de
douane,
l’octroi.
les
billets
de
spectacles,
le
timbre
des
journaux,
les
droits
sur
la
vente
du
tabac,
le
transport
des
lettres
par
la
poste,
le
timbre,’’
etc.,
and
he
says:
“Toutes
ces
manières
de
lever
les
contributions
les
rangent
dans
la
classe
des
contributions
indirectes,
parce
que
la
demande
n’en
est
pas
faite
à
personne
directement,
mais
au
produit,
à
la
marchandise
frappée
de
l’impôt,
’
’
and
in
a
note
he
adds
:
‘‘Et
non
parce-
qu’elles
atteignent
indirectement
le
contribuable;
car
si
elles
tiraient
leur
dénomination
de
cette
dernière
circonstance,
il
faudrait
donner
le
même
nom
à
des
contributions
très
directes,
comme
par
exemple
à
l
9
impôt
des
patentes
qui
tombe
en
partie
indirectement
sur
le
consommateur
des
produits
dont
s’occupe
la
patente.’’
“La
patente,
says
de
Gerando,
Droit
Administratif,
vol.
4.
p.
42,
‘‘confère
le
droit
d’exercer
librement
une
branche
d’industrie.”
(Loi
des
2-17
mars
1791.)
At
p.
129,
the
same
writer
says:
"La
licence
a
quel-
qu’analogie
avec
la
patente,
elle
s’applique
à
la
profession
exercée.’’
l
‘Elle
correspond
à
la
déclaraation
de
celui
qui
l’exerce
;
elle
la
constate.
“La
déclaration
a
pour
objet
de
faire
connaître
à
l’administration
ceux
qui
exercent
une
profession
spécialement
soumise
à
la
surveillance.
“Elle
est
exigée
des
débitants
de
boissons,
des
marchands
en
gros,
des
brasseurs,
distillateurs
et
bouilleurs
de
profession.”
This
writer
places
the
droits
de
patentes
among
the
contributions
directes
and
the
droits
de
licences
among
the
contributions
indirectes,
(pp.
5
and
42
and
pp.
100
and
129.)
Leroy-Beaulieu,
Traité
de
la
Science
des
Finances,
vol.
1,
p.
214,
after
showing
that
the
definition
of
direct
and
indirect
taxes
is
not
the
same
in
every
country,
says
:
‘‘Par
Vimpôt
direct
le
législateur
se
propose
d’atteindre
immédiatement
du
premier
bond
et
proportionnellement
à
sa
fortune
ou
à
ses
revenus,
le
véritable
contribuable;
il
supprime
tout
intermédiaire
entre
lui
et
le
fisc,
et
il
cherche
une
proportionalité
rigoureuse
de
l’impôt
à
la
fortune
ou
aux
facultés.
“Par
Vimpôt
indirect
le
législateur
ne
vise
pas
immédiatement
le
véritable
contribuable
et
ne
cherche
pas
à
lui
imposer
une
charge
strictement
proportionnelle
à
ses
facultés
:
il
ne
se
propose
d’atteindre
le
vrai
contribuable
que
par
ricochet,
par
contre-coup,
par
répercussion:
il
met
des
intermédiaires
entre
lui
et
le
fisc,
et
renonce
à
une
stricte
proportionnalité
de
l’impôt
dans
les
cas
particuliers,
se
contentant
d’une
proportionnalité
relative
en
général.’’
Passy,
in
the
Dictionnaire
de
l’Economie
Politique,
vo.
impôt
SAYS
:—
“C’est
un
usage
reçu
de
diviser
les
impôts
en
deux
catégories
distinctes.
On
appelle
directs
ceux
que
les
contribuables
acquittent
eux-mêmes
pour
leur
propre
compte;
on
appelle
indirects
ceux
dont
certains
d’entre
eux
ne
font
que
l’avance
et
dont
ils
obtiennent
le
remboursement
des
mains
d’autres
personnes.”
The
test
applied
by
these
two
writers
to
distinguish
direct
from
indirect
taxes
is
inconsistent
with
the
definition
given
by
Say.
It
is,
however,
substantially
the
same
as
that
indicated
by
Merlin
as
derived
from
the
law
of
the
8th
of
January,
1790,
and
by
Mill,
Principles
of
Political
Economy,
lib.
5,
ch.
3,
§
1,
who
says
:—
"
"
Taxes
are
either
direct
or
indirect.
A
direct
tax
is
one
which
is
demanded
from
every
person
who
it
is
intended
or
desired
should
pay
it.
Indirect
taxes
are
those
which
are
demanded
from
one
person
in
the
expectation
and
intention
that
he
shall
indemnify
himself
at
the
expense
of
another:
such
are
the
excise
or
customs.’’
,
And
Walker—Science
of
Wealth,
p.
338
:—
“A
direct
tax
is
demanded
of
the
person
who
it
is
intended
shall
pay
it.
Indirect
taxes
are
demanded
from
one
person,
in
the
expectation
that
he
will
indemnify
himself
at
the
expense
of
others.’’
According
to
McCulloch,
Principles
of
Taxation,
p.
1
:—
"A
tax
may
be
either
direct
or
indirect.
It
is
said
to
be
direct
when
taken
directly
from
property
or
income,
and
indirect
when
it
is
taken
from
them
by
making
individuals
pay
for
liberty
to
use
certain
articles
or
to
exercise
certain
privileges.”
Under
this
last
definition
the
revenue
raised
by
means
of
the
licenses
mentioned
in
subsection
9
of
section
92,
of
the
Confederation
Act,
would
in
England
be
considered
as
the
out-come
of
an
indirect
tax,
while
in
France
it
might
be
considered
as
a
patent
tax,
which
is
a
direct
tax,
or
a
license
tax,
which
is
an
indirect
tax.
Mill,
in
the
work
already
cited,
ch.
5,
§
1,
says
:—
"Besides
direct
taxes
on
income,
and
taxes
on
consumption,
the
financial
systems
of
most
countries
comprise
a
variety
of
miscellaneous
imposts
not
strictly
included
in
either
class.”
I
do
not
wish
to
discuss
here
the
comparative
merits
of
these
definitions
and
classifications.
My
only
object
in
making
the
above
citations
is
to
show
that
the
expressions
“direct"
and
indirect
taxes,"
in
their
legislative
application,
are
purely
conventional
terms,
having
a
different
meaning
according
to
the
different
legislation
of
each
country
in
which
they
are
used,
and
that
as
legal
terms
they
have
no
common
or
scientific
basis.
This
could
hardly
be
otherwise,
since
in
every
country
new
taxes
or
new
modes
of
taxation,
unknown
in
other
countries,
are
constantly
brought
into
operation,
and
old
or
effete
taxes
are
revived
under
new
names
and
a
new
classification,
so
that
it
is
almost
impossible
for
foreign
writers
to
follow
the
changes.
The
old
aides
or
gabelles
which
existed
in
France
before
the
Revolution,
and
were
abolished
by
the
Assemblée
Constituante,
became
under
the
First
Empire
the
‘‘
droits
réunis.”
The
(i
droits
réunis’’
disappeared
with
the
Empire;
the
taxes,
however,
were
retained
at
the
Restoration,
under
the
less
obnoxious
name
of
contributions
indirectes.
In
England,
some
of
the
stamp
duties,
and
even
some
of
the
taxes
formerly
known
as
assessed
taxes,
have
by
recent
statutes
been
declared
to
be
excise
duties.
Stephen,
Commentaries,
vol.
2,
p.
567,
speaking
of
excise,
says
that,
in
England,
"‘its
advantages,
indeed,
are
such
that
under
recent
Acts
of
Parliament
many
imposts
have
been
classed
(probably
for
greater
convenience
in
collection)
under
this
head
of
duties,
which
are
not
properly
in
the
nature
of
excise.
Such
is
the
case
with
regard
to
licenses,
which
the
law
requires
to
be
annually
taken
out
by
those
who
manufacture
or
deal
in
certain
articles,
or
who
follow
certain
employments.’’
This
is
very
much
the
same
language
used
by
Merlin
as
regards
the
droits
d’enregistrement,
when
he
says
they
ought
not
to
be
considered
as
impositions
indirectes,
cependant
on
s’est
habitué
à
les
ranger
dans
cette
classe.
If
such
a
change
can
be
done
by
usage
or
custom,
surely
it
can
be
effected
by
express
legislation.
In
the
case
of
Springer
v.
The
United
States
(102
United
States
Rep.,
p.
597,)
the
following
passage
of
a
brief
prepared
for
the
case
of
Hylton
v.
The
United
States,
by
Hamilton,
the
distinguished
statesman
and
jurist,
is
cited:—
"‘What
is
the
distinction
between
direct
and
indirect
taxes?
It
is
a
matter
of
regret
that
terms
so
uncertain
and
vague,
on
a
point
so
important,
are
to
be
found
in
the
Constitution.
We
shall
seek
in
vain
for
any
antecedent
settled
legal
meaning
to
the
respective
terms.
There
is
none.
We
shall
be
as
much
at
a
loss
to
find
any
disposition'
of
either
which
can
satisfactorily
determine
the
point.’’
And
in
the
case
of
Veazie
Bank
v.
Fenno
(8
Wallace,
533),
to
which
I
have
already
referred,
Chief
Justice
Chase
is
reported
to
have
said:
‘‘Much
diversity
of
opinion
has
always
prevailed
upon
the
question
what
are
direct
taxes?
Attempts
to
answer
it
by
reference
to
the
definitions
of
political
economists
have
been
frequently
made,
but
without
satisfactory
results.
The
enumeration
of
the
different
kinds
of
taxes
which
Congress
was
authorized
to
impose
was
probably
made
with
little
reference
to
their
speculations.
‘
‘
All
this
shows
the
difficulty
of
applying
in
every
country,
the
same
test
of
description
to
the
words
direct
or
indirect
taxes:
and
I
think
that
the
remarks
of
Chief
Justice
Chase
are
as
applicable
to
the
British
N.
America
Act
as
to
the
constitution
of
the
United
States.
We
must
therefore
look
elsewhere
for
a
satisfactory
interpretation
of
the
legal
meaning
of
the
words
direct
taxation
as
used
in
the
British
North
America
Act.
We
must
first
exhaust.
the
ordinary
rules
of
interpretation
applicable
to
statute
law,
and
seek
in
the
Act
itself
and
in
the
different
provisions
relating
to
the
power
of
taxation
what
meaning
the
Imperial
Parliament
has
attached
to
those
words.
We
must
also
refer
to
the
other
acts
passed
by
Parliament
on
the
same
or
cognate
subjects,
to
find
how
similar
taxes
have
been
classified,
and
finally
we
must
consider
what
effect
the
decisions
already
rendered
by
our
highest
courts
and
by
the
Lords
of
the
Privy
Council
on
the
several
questions
of
taxation,
which
have
come
before
them,
have
on
the
present
cases.
Should
these
enquiries
fail
to
satisfy
us,
then.
we
may
have
recourse
to
those
more
remote
and
I
may
add
less
satisfactory
sources
of
information,
the
United
States
decisions
and
the
opinions
of
political
economists,
not
as
authority,
but
as
arguments
and
reasons
emanating
from
eminent
jurists
and
scientific
men,
whose
views
on
such
questions
are,
undoubtedly,
deserving
of
great
consideration.
•
By
referring
to
the
British
North
America
Act,
we
find
that
the
third
subsection
of
section
91,
gives
to
the
Dominion
Parliament
the
exclusive
legislative
authority
for
the
raising
of
money
by
any
mode
or
system
of
taxation.
Section
102
provides
that
all
duties
and
revenues
over
which
the
respective
legislatures
of
the
several
provinces,
at
the
time
of
the
Union,
had
power
to
appropriate,
except
such
as
are
reserved
to
the
respective
legislatures,
or
are
raised
by.
them
in
accordance
with
the
special
powers
conferred
on
them
by
the
Act,
shall
form
one
consolidated
revenue
fund
to
be
appropriated
for
the
public.
service
of
Canada,
&c.
By
sec.
121,
all
articles
of
the
growth,
produce
or
manufacture
of
any
of
the
Provinces
are
to
be
admitted
free
into
the
other
Provinces.
Section
122
places
the
customs
and
excise
laws
in
force
in
each
Province
under
the
control
of
the
Dominion
Parliament,
by
providing,
that
‘‘The
customs
and
excise
laws
of
each
Province
are
to
remain
in
force
until
altered
by
the
Parliament
of
Canada^
By
section
123
Interprovincial
customs
duties
are
abolished,
and
section
124
reserves
to
the
Province
of
New
Brunswick
the
right
to
levy
certain
existing
export
duties
on
lumber,
but
forbids
their
increase;
and
finally,
it
is
provided
by
section
126,
that
those
portions
of
duties
and
revenues
reserved
to
the
respective
governments
or
legislatures
of
the
Provinces,
and
the
duties
raised
by
them
in
accordance
with
the
special
powers
conferred
upon
them
by
the
Act,
shall
in
each
Province
form
the
consolidated
revenue
fund
of
the
Province.
From
these
several
provisions
it
is
clear
that
the
whole
of
the
duties
and
revenue
of
which,
before
the
Union,
each
of
the
provinces
could
dispose,
including
customs
and
excise
duties,
have
been
transferred
to
the
Dominion,
together
with
the
exclusive
power
to
alter
them
and
to
raise
money
by
any
mode
or
system
of
taxation;
except
as
regards
such
portions
of
those
duties
and
revenues
which
are
reserved
to
the
Provinces,
and
such
other
duties
as
they
may
raise
under
the
special
powers
conferred
on
them.
The
Provinces
have
therefore
no
power
to
deal
with
or
to
impose
customs
or
excise
duties,
nor
to
raise
any
revenue
whatsoever
by
taxation
unless
the
power
and
authority
to
do
so
has
been
specially
conferred
upon
them
by
some
other
portion
of
the
Act,
and
only
to
the
extent
to
which
such
power
has
been
conferred.
Now,
there
are
only
two
provisions
of
the
Act,
by
which
the
provincial
legislatures
are
authorized
to
raise
a
revenue
by
taxation.
They
are
contained
in
subsection
2,
and
subsection
9,
of
section
92,
and
they
are
in
these
terms
:—
Subsec.
2.
<(
Direct
taxation
within
the
Province
in
order
to
the
raising
of
a
revenue
for
provincial
purposes."
Subsec.
9.
‘‘Shop,
saloon,
tavern,
auctioneer
and
other
licenses
in
order
to
the
raising
of
a
revenue
for
provincial,
local
or
municipal
purposes."
These
two
subsections
are
mere
exceptions
to
the
exclusive
power
of
taxation
conferred
on
the
Dominion
Parliament
by
section
91,
subsection
3,
and
must
be
read
in
connection
with
this
last
subsection,
as
if
it
was
in
the
following
terms,
viz.
:
"‘It
shall
be
lawful
for
the
Queen,
by
and
with
the
advice
and
consent
of
the
Senate
and
House
of
Commons,
to
make
laws
for
the
peace,
order
and
good
government
of
Canada,
in
relation
to
all
matters
not
coming
within
the
classes
of
subjects
by
this
Act
assigned
exclusively
to
the
legislatures
of
the
Provinces;
and
for
greater
certainty,
but
not
so
as
to
restrict
the
generality
of
the
foregoing
terms
of
this
section,
it
is
hereby
declared
that
(notwithstanding
anything
in
this
Act),
the
exclusive
legislative
authority
of
the
Parliament
of
Canada
extends
(3).
To
the
raising
of
money
by
any
mode
or
system
of
taxation,
with
the
exception
that
each.
Provincial
Legislature
may
exclusively
make
laws
in
relation
to
direct
taxation
within
the
Province,
in
order
to
the
raising
of
a
revenue
for
provincial
purposes,
and
(9)
in
relation
to
shop,
saloon,
tavern,
auctioneer
and
other
licenses
in
order
to
the
raising
of
a
revenue
for
provincial,
local
or
municipal
purposes.”’
There
is
no
authority
here
conferred
on
the
provincial
legislatures
to
raise
a
revenue
by
indirect
taxation,
nor
by
customs
or
excise
duties,
except
in
so
far
as
shop,
saloon,
tavern,
auctioneer
and
other
licenses,
may
be
considered
as
excise
duties,
all
others
being
excluded
by
the
exclusive
power
of
taxation
conferred
on
the
Dominion
Parliament
by
subsection
3,
of
section
91,
and
by
sections
102,
121,
122,
123,
124
and
126
already
mentioned.
This
is
made
very
clear
by
the
resolutions
which
were
submitted
to
the
Legislature
of
the
Province
of
Canada
as
the
basis
of
the
Confederation
Act.
Resolution
29
(Debates
on
Confederation,
p.
3),
proposed
that:
The
General
Parliament
shall
have
power
to
make
laws
for
the
peace,
welfare,
&c.,
and
especially
laws
respecting
:
3rd.
The
imposition
or
regulation
of
duties
of
Customs
or
Imports
and
Exports,
except
on
Exports
of
Timber,
&c.,
from
New
Brunswick
and
of
Coal
and
other
minerals
from
Nova
Scotia.
4th.
The
imposition
and
regulation
of
Excise
Duties.
5th.
The
raising
of
money
by
all
or
any
other
modes
or
systems
of
Taxation.
In
the
Confederation
Act,
the
articles
3
and
4
of
the
29th
resolution
were
dropped,
except
as
to
export
duties
on
lumber
in
New
Brunswick
and
on
coal
in
Nova
Scotia,
which
were
provided
for
in
another
form
by
sections
109
and
124
of
the
Act,
and
article
5,
which
became
subsection
3
of
the
91st
section,
was
modified
by
striking
out
the
words
i(
all
or
any
other
modes
or
systems
of
taxation,’’
and
substituting
therefor
the
words
<(
by
any
mode
or
system
of
taxation,”
so
as
to
include
the
duties
of
customs
and
of
excise
mentioned
in
the
third
and
fourth
articles;
and
to
avoid
doubts
as
to
the
respective
powers
of
the
Dominion
Parliament
and
of
the
Provincial
Legislatures,
the
word
^exclusively”
was
added
in
the
first
part
of
section
91,
so
as
to
give
to
the
Dominion
Parliament
the
exclusive
power
to
legislate
on
customs
and
excise
duties,
as
well
as
on
the
other
subjects
mentioned
in
this
section.
Then
the
other
sections
already
cited,
namely,
102
and
126,
specially
provide
that
the
local
governments
shall
have
no
other
sources
of
revenue
except
those
expressly
reserved,
and
those
which
they
are
authorized
to
raise
in
accordance
with
the
special
powers
conferred
upon
them
by
the
Act;
so
that,
apart
from
the
exclusive
authority
given
to
the
Dominion
Parliament
to
raise
a
revenue
by
all
modes
of
taxation,
we
have
the
repeated
declarations
contained
in
sections
102
and
126,
that
the
provinces
shall
have
no
right
to
impose
any
duties
or
taxes
except
under
the
special
powers
given
to
them
by
the
Act.
I
find
no
difficulty
in
reconciling
the
exclusive
power
given
to
the
Dominion
with
the
exclusive
power
attributed
to
the
Provincial
Legislatures
as
regards
taxation.
The
Dominion
Parliament
has
the
exclusive
power
to
raise
a
revenue
by
all
modes
of
taxation
for
Dominion
purposes,
and
the
Provincial
Legislatures
have
exclusive
authority
to
raise
a
revenue
by
direct
taxation
for
Provincial
purposes.
That
is,
the
Dominion
alone,
to
the
exclusion
of
the
Provincial
Legislatures,
is
authorized
to
raise
a
revenue
for
Dominion
or
general
purposes,
and
the
Provincial
Legislatures,
to
the
exclusion
of
the
Dominion
Parliament,
are
authorized
to
raise
a
revenue
by
direct
taxation
for
their
respective
provinces.
In
other
words,
the
Dominion
Parliament
cannot
interfere
with
the
taxation
for
provincial
purposes,
nor
the
local
legislatures
with
the
taxation
for
Dominion
purposes.
It
has
been
contended
that,
as
by
subsection
16
of
section
92
the
local
legislatures
were
authorized
to
legislate
on
all
matters
of
a
purely
local
or
private
nature
in
the
provinces,
they
were
therefore
authorized
to
raise
a
revenue
for
provincial
purposes
by
all
modes
of
taxation,
including
direct
and
indirect,
as
well
as
by
customs
and
excise
duties.
The
answer
to
this
contention
is
obvious.
One
of
the
most
elementary
rules
of
interpretation
of
Statutes
is
that
general
provisions
in
an
Act
of
Parliament
do
not
control
nor
affect
the
special
enactments
which
it
contains,
and
therefore
the
general
authority
conferred
by
subsection
16
as
to
matters
of
a
purely
local
or
private
nature
in
the
province
can
only
apply
to
such
other
matters
as
are
not
specially
provided
for
by
the
Act,
and
as
the
subject
of
provincial
taxation
is
specially
provided
for
by
subsections
2
and
9
of
section
92,
subsection
16
does
not
apply
to
the
subject
of
taxation.
(Dwarris,
p.
765.)
If
subsection
16
was
not
limited
by
the
preceding
subsections
2
and
9,
these
subsections
would
have
been
quite
unnecessary,
since
subsection
16,
by
the
generality
of
its
terms,
would
have
covered
all
subjects
over
which
the
Provincial
Legislatures
could
have
exercised
their
legislative
authority.
The
historical
evidence
derived
from
the
discussions
which
took
place
in
the
Parliament
of
Canada
on
the
Confederation
resolutions
show
that
it
was
never
intended
that
the
local
legislatures
should
have
the
unlimited
power
to
impose
all
kinds
of
taxes.
Sir
Alexander
Galt,
then
Finance
Minister,
in
explaining
the
financial
aspect
of
the
proposed
confederation,
said:
(Parliamentary
Debates
on
Confederation,
p.
58).""
If
nevertheless
the
local
revenues
become
inadequate,
it
will
be
necessary
for
the
local
governmeints
to
have
recourse
to
direct
taxation,
and
I
do
not
hesitate
to
say
that
one
of
the
wisest
provisions
in
the
proposed
constitution,
and
that
which
affords
the
surest
guarantee
that
the
people
will
take
a
healthy
interest
in
their
own
affairs
and
see
that
no
extravagance
is
committed
by
those
placed
in
power
over
them,
is
to
be
found
in
the
fact
that
those
who
are
called
upon
to
administer
public
affairs
will
feel
when
they
resort
to
direct
taxation,
that
a
solemn
responsibility
rests
upon
them,
and
that
that
responsibility
will
be
exacted
by
the
people
in
the
most
peremptory
manner.
If
the
men
in
power
find
that
they
are
required,
by
means
of
direct
taxation,
to
procure
the
funds
necessary
to
administer
the
local
affairs,
for
which
abundant
provision
is
made
in
the
scheme,
they
will
pause
before
they
enter
upon
any
career
of
extravagance.
Indeed
I
do
not
hesitate
to
say,
that
if
the
public
men
of
those
provinces
were
sufficiently
educated
to
understand
their
own
interests
in
the
true
light
of
the
principles
of
political
economy,
it
would
be
found
better
now
to
substitute
direct
taxation
for
some
of
the
indirect
modes
by
which
taxation
has
been
imposed
upon
the
industry
of
the
people.
I
do
not
however
believe
that
at
this
moment
it
is
possible,
nor
do
I
think
the
people
of
this
country
-
would
support
any
government
in
adopting
this
measure,
unless
it
were
forced
upon
them
by
the
pressure
of
an
overwhelming
necessity.
‘
‘
And
further,
(p.
69,)
Mr.
Galt
added:
“In
transferring
to
the
general
government
all
the
large
sources
of
revenue
and
in
placing
in
their
hands,
with
a
single
exception,
that
of
direct
taxation,
all
the
means
whereby
the
industry
of
the
people
may
be
made
to
contribute
to
the
wants
of
the
state,
etc.’’
The
tax
Mr.
Galt
was
speaking
of
and
which
he
thought
could
only
be
forced
on
the
people
by
the
pressure
of
an
overwhelming
necessity,
was
neither
a
customs
nor
an
excise
duty,
both
of
which
the
people
of
Canada
had
long
been
accustomed
to
pay,
but
the
direct
tax
which
is
assessed
by
the
tax
gatherer
going
to
every
house
and
exacting
either
a
capitation
tax,
or
a
proportion
of
each
inhabitant’s
income
or
property
to
replenish
the
provincial
treasury.
These
were
the
only
direct
taxes
known
in
the
provinces,
in
some
of
which
they
were
raised
for
municipal
and
partially
for
school
purposes.
When
Mr.
Galt
gave
this
solemn
warning
to
the
public
men
who
would
be
charged
under
Confederation
with
the
management
of
the
provincial
affairs
and
spoke
of
this
dreaded
direct
tax,
he
did
not
contemplate
that
to
convert
it
into
the
most
popular
tax
ever
imposed,
it
would
only
be
necessary
for
the
provincial
legislature
to
pass
an
Act,
with
the
title
:
‘
‘An
Act
to
raise
a
revenue
for
provincial
purposes
by
means
of
a
direct
tax
within
the
Province,”
and
to
enact
that
every
British,
Foreign
or
domestic
Insurance
Corporation,
every
Bank,
every
Loan
Company,
every
Navigation
and
Telegraph
Company,
whether
incorporated
in
Canada
or
elsewhere,
whether
their
stock
was
held
in
the
province
or
not,
but
doing
business
in
the
province,
should
pay
a
tax
calculated
not
on
the
amount
of
business
done
in
the
province,
but
on
the
paid
up
capital
or
stock
of
each
company,
so
as
to
indirectly
collect
the
greater
portion
of
this
tax
through
the
English,
the
American
and
other
capitalists
investing
their
money
in
any
of
the
commercial
enterprises
mentioned
in
the
Act.
As
however
the
Legislatures
of
the
Provinces
cannot
extend
their
power
of
taxation
by
declaring
that
a
tax
is
a
direct
tax,
if
it
is
not
so
under
the
British
North
America
Act,
we
have
to
examine
the
question
raised
in
the
present
cases
irrespective
of
the
description
or
name
given
by
the
45th
Vict.,
ch.
22,
to
the
tax
imposed
by
its
provisions.
It
is
not
contended
that
the
present
tax
was
imposed
under
the
authority
of
subsection
nine,
for
it
is
not
a
tax
raised
by
means
of
licenses,
and
it
is
evident
that
the
legislature
intended
to
impose
certain
direct
taxes,
since
it
has
used
those
very
words
in
the
title
of
the
Act,—yet
it
is
necessary
to
ascertain
what
is
the
character
of
the
duties
which
the
Provinces
are
authorized
to
raise
by
means
of
the
licenses
mentioned
in
subsection
nine,
in
order
to
collect
the
meaning
which
the
Legislature
of
the
late
Province
of
Canada
and
the
Imperial
Parliament
have
attached
to
the
words
‘‘direct
taxation’’
as
used
in
the
resolutions
passed
by
that
legislature
and
in
the
B.N.A.
Act.
It
seems
evident
that
neither
the
Legislature
of
Canada,
nor
the
Imperial
Parliament
did
consider
that
the
revenues
to
be
raised
by
these
licenses
were
‘‘direct
taxes,’’
otherwise
subsection
nine
would
have
had
no
meaning,
since
"‘direct
taxation”?
was
already
provided
for
by
subsection
2.
Now,
let
us
see
how
these
license
duties
and
other
similar
duties
were
considered
in
England
before
and
at
the
time
the
British
North
America
Act
was
passed.
As
far
back
as
1803,
the
Imperial
Parliament
passed
an
Act
(43
Geo.
III.,
ch.
69)
to
repeal
duties
of
excise,
and
to
impose
others
to
replace
them.
The
first
item
of
the
new
duties
mentioned
in
Schedule
A.,
under
the
title
‘‘
Duties
of
Hxcise,’’
is
a
duty
of
sixpence
on
sales
by
auction
of
certain
property
to
the
amount
of
twenty
shillings,
and
the
second
item
is
of
another
duty
of
tenpence
on
similar
sales
of
other
classes
of
property.
Then
the
same
schedule
headed
"
"
duties
of
excise’’
contains
a
description
of
persons
who
are
obliged
to
take
licenses
in
order
to
exercise
certain
trades
or
businesses,
and
among
them
are
to
be
found,
besides
those
for
manufacturing
or
selling
beer,
ale
or
spirits
of
any
kind,
every
person
exercising
the
trade
or
business
of
auctioneer,
every
person
trading
or
vending
or
selling
coffee,
tea,
cocoanut,
every
person
trading
in,
vending
or
selling
gold
or
silver
plate,
every
dealer
or
seller
of
tobacco
or
snuff,
for
which
licenses
they
have
to
pay
a
license
fee
varying
in
amount
according
to
the
kind
or
amount
of
business
done.
The
necessities
of
state
during
the
great
continental
wars
of
the
first
quarter
of
the
present
century
required
constant
changes
in
those
licenses
and
duties,
and
there
are
several
statutes
in
which
they
are
described
as
excise
licenses
and
excise
duties.
In
the
course
of
time,
new
taxes
were
imposed,
and
among
others
a
tax
on
Railway
Companies,
which
is
charged
on
the
number
of
passengers
carried.
No
license
is
required
in
this
case.
The
tax
is,
however,
placed
in
the
list
of
excise
duties.
In
1864,
three
years
before
the
passing
of.
the
British
North
America
Act,
the
Imperial
Parliament
passed
the
27th
and
28th
Vict.,
ch.
56,
by
which
it
is
enacted
that
from
and
after
the
first
day
of
July,
1864,
the
duties
now
payable
by
law
upon
or
in
respect
of
the
licenses
to
be
taken
out
in
the
United
Kingdom
"‘by
persons
carrying
on
the
trades
and
business
hereinafter
mentioned
as
described
and
defined
by
statutes
relating
to
such
licenses
and
trades
or
business
respectively,
that
is
to
say
:—
Appraisers;
pawnbrokers;
dealers
in
gold
and
silver
plate;
owners,
proprietors,
makers
and
compounders
of
and
persons
uttering,
vending
or
exposing
for
sale
any
medicine
liable
to
a
stamp
duty;
hawkers
and
pedlars;
house
agents;
sellers
of
playing
cards
not
being
makers
thereof,
shall
respectively
be
denominated
and
deemed
to
be
duties
of
excise,
and
the
said
licenses
respectively
shall
be
granted
by
such
officer
or
officers
of
Excise.’’
Again,
if
we
look
at
the
returns
made
to
Parliament
of
the
different
sources
of
revenue
for
the
fiscal
year
ended
on
the
31st
of
March,
1866,
the
year
before
the
Act
of
Confederation
was
passed,
we
find
the
last-mentioned
duties
classed
among
the
duties
collected
from
excise,
as
also
the
railway
tax,
the
stage
carriage
tax,
licenses
and
duties
on
retailers
of
spirits,
on
tea
and
coffee
dealers,
on
auctioneers,
and
on
many
other
classes
of
persons
carrying
on
particular
trades
or
business.
It
may
be
true,
as
observed
by
Stephen,
loc.
cit.,
that
some
of
these
imposts
are
not
properly
in
the
nature
of
excise
duties,
if
these
words
are
used
in
the
limited
sense
of
duties
on
articles
of
consumption;
but
it
is
not
the
technical
classification
which
political
economists
might
make
of
these
different
imposts
we
have
to
ascertain:
it
is
the
legal
meaning
which
the
Imperial
Parliament
has
attached
to
the
duties
which
the
Provincial
Legislatures
are
authorized
to
impose
by
means
of
shop,
tavern,
auctioneer
and
other
licenses
mentioned
in
subsection
9,
and
this
we
find
clearly
indicated
in
the
several
statutes
which
have
been
passed
since
the
beginning
of
the
present
century
to
regulate
excise
duties,
and
in
the
public
documents
submitted
to
and
sanctioned
by
the
Imperial
Parliament.
If
these
license
duties
in
their
origin
were
not
strictly
excise
duties
in
the
technical
sense
of
those
words,
they
are
so
intimately
connected
with
them,
as
accessories
to
the
raising
of
excise
duties,
that
they
have
long
since
been
considered
as
part
and
portion
of
them;
and
if,
as
Merlin
tells
us,
the
droits
d
9
enregistrement
in
France
are
generally
considered
as
indirect
taxes,
although
they
are
not
properly
so,
there
is
far
greater
reason
in
construing
an
Imperial
statute
to
consider
as
excise
duties
what
the
Imperial
Parliament
has
repeatedly
declared
to
be
so.
The
licenses
mentioned
in
subsection
9
of
the
British
North
America
Act
are
the
same
as
some
of
those
mentioned
in
the
statutes
and
returns
we
have
just
referred
to;
and
in
the
absence
of
any
expressions
to
distinguish
them
from
the
same
imposts
levied
in
England,
we
must
hold
that
they
are
of
the
same
character,
and
that
by
enacting
the
9th
subsection
of
section
92,
Parliament
clearly
indicated
their
intention
of
authorizing
the
Provincial
Legislatures
to
impose
by
means
of
licenses
imposts
which
were
not
included
in
the
authority
given
by
subsection
2
to
raise
a
revenue
by
direct
taxation.
The
next
inquiry
is
as
to
whether
the
present
taxes
are
of
the
same
nature
as
those
mentioned
in
subsection
9.
It
seems
to
be
indifferent
how
a
business
tax
is
levied
in
England.
It
is
sometimes
by
a
license
fee,
as
in
the
case
of
shop
and
tavern
keepers,
hawkers
and
pedlars,
&c.
;
sometimes
partly
by
license
fee
and
partly
by
a
percentage
on
the
business,
as
in
the
case
of
auctioneers.
In
the
case
of
railways,
no
licenses
are
issued,
and
the
tax
is
on
the
number
of
passengers
carried,
that
is,
on
the
gross
business
of
the
companies,
or
it
is
on
the
number
of
miles
run
irrespective
of
the
business
done,
as
in
the
case
of
stage
carriages,
and
sometimes
on
the
kind
of
carriage,
the
number
of
seats
they
have,
or
the
number
of
horses
attached,
that
is,
on
the
capacity
to
do
business
irrespective
of
its
amount,
and
yet
the
nature
of
the
tax
is
not
changed
by
these
differences,
and
in
all
these
cases
the
impost
is
considered
as
an
excise
duty.
Cooley,
on
Taxation,
pp.
20-21,
says:—
"TAXES
ON
EMPLOYMENTS.—A:
tax
on
the
privilege
of
carrying
on
a
business
or
employment
will
commonly
be
imposed
in
the
form
of
an
excise
tax
on
the
license
to
pursue
the
employment;
and
this
may
be
a
specific
sum
or
a
sum
whose
amount
is
regulated
by
the
business
done,
or
income,
or
profits
earned.
Sometimes
small
license
fees
are
required,
mainly
for
the
purpose
of
regulation,
but
in
other
cases
substantial
taxes
are
demanded
because
the
persons
upon
whom
they
are
laid
would
otherwise
escape
taxation
in
the
main,
if
not
entirely.
Instances
of
hawkers,
pedlars,
auctioneers,
&c.,
will
readily
occur
to
the
mind.
The
form
of
a
license,
though
not
necessary,
is
a
convenient
form
for
such
a
tax
to
assume,
because
it
then
becomes
a
condition
to
entering
the
business
or
employment,
and
it
is
collected
without
difficulty.
But
it
is
equally
competent
to
impose
and
collect
the
tax
by
usual
methods.”
Mr.
Justice
Manning
in
the
case
of
Childers
v.
People
(11
Michigan,
pp.
43-49),
says:—"‘Taxes
upon
business
are
usually
collected
in
the
form
of
license
fees;
and
this
may
possibly
have
led
to
the
idea
which
seems
to
prevail
in
some
quarters
that
a
tax
implies
a
license.
But
there
is
no
necessary
connection
between
them.
A
business
may
be
licensed
and
yet
not
taxed,
or
it
may
be
taxed
and
yet
not
licensed.’’
This
shows
that
the
character
of
a
tax
is
not
altered
by
the
fact
that
it
is
collected
by
means
of
a
license
fee
or
without
a
heense.
In
the
present
instance
the
tax
imposed
was
mentioned
as
a
license
or
a
license
tax
in
the
bill
when
first
introduced
into
the
Legislature.
During
the
progress
of
the
measure
the
title
of
the
bill
was
changed
into
that
of
an
Act
to
impose
certain
Direct
Taxes
on
certain
commercial
corporations.
It
cannot
be
reasonably
contended
that
the
nature
of
the
tax
was
thereby
altered.
The
name
alone
was
changed,
but
not
the
substance.
It
is
also
evident,
that
there
can
be
no
difference
whether
the
tax
is
imposed
on
individuals,
companies
or
corporations.
We
have
just
seen
that
in
England
an
excise
duty
was
imposed
on
Railway
Corporations,
as
well
as
on
the
owners
of
Stage
Carnages
and
Hackney
Coaches.
In
the
United
States,
whether
the
State
Legislatures
are
endowed
with
general
powers
to
legislate
on
all
subjects
not
specially
delegated
to
Congress
representing
the
Federal
legislative
authority,
and
where
the
several
States
are
authorized
to
raise
a
revenue
by
means
of
Excise
Duties,
the
question
as
to
the
nature
of
a
tax
on
the
business
carried
on
by
Corporations
has
repeatedly
been
adjudicated
upon
and
its
proper
classification
determined.
In
the
ease
of
the
Attorney-General
v.
The
Bay
State
Mining
Co.
(99
Mass.
148),
it
was
held
that
the
right
to
exercise
a
corporate
franchise
within
the
State
of
Massachusetts
was
the
proper
subject
of
an
Excise
Tax
which
the
State
had
a
right
to
impose.
The
same
thing
was
decided
in
the
case
of
Oliver
v.
The
London
Fire
Insurance
Co.
(100
Mass.
538).
In
the
case
of
the
Commonwealth
v.
Hamilton
Manufacturing
Co.,
12
Allen,
298,
Bigelow,
C.J.,
said:
"‘It
is
too
clear
to
admit
of
discussion
that
according
to
recent
adjudications
of
this
Court,
the
assessment
which
is
the
subject
of
controversy
in
these
actions
must
be
supported
if
sustained
at
all,
as
the
exercise
by
the
legislature
of
the
authority
conferred
by
that
clause
of
the
constitution,
part
2,
ec.
1,
§
1,
art.
4,
which
gives
the
power
of
imposing
duties
and
excises
upon
any
commodity
within
the
Commonwealth;
in
other
words,
it
cannot
be
held
valid
unless
it
can
be
construed
to
be
in
the
nature
of
an
excise
tax
on
the
franchise
of
the
corporations
designated
in
the
Statute,
&c.‘‘
.
.
.
And
at
p.
304,
the
learned
judge
adds:
"‘These
illustrations
serve
to
show
that
an
assessment
based
on
the
market
value
of
the
shares
of
a
corporation,
of
the
aggregate
of
said
shares,
or
capital
stock,
cannot
be
properly
deemed
a
tax
on
the
property
of
the
corporation.
‘
‘
And
again
at
p.
307,
"To
our
minds,
it
is
a
sufficient
and
decisive
answer
to
that
argument,
that,
according
to
the
views
we
have
already
expressed,
the
assessment
in
question
is
an
excise
duty
on
the
franchise
of
the
corporation
on
which
it
is
imposed,
and
was
intended
by
the
legislature
to
have
that
operation
and
effect
only,
and
not
in
any
proper
sense
a
tax
on
corporate
property.’’
See
also
Portland
Bank
v.
Apthorp,
(12
Mass.
252).
These
decisions
differ
from
those
rendered
by
the
United
States
Supreme
Court
on
the
interpretation
to
be
given
to
the
words
""direct
taxes’’
used
in
the
Constitution
of
the
United
States,
inasmuch
as
the
Supreme
Court
had
to
consider
how
far
direct
taxation
was
limited
by
the
necessity
of
apportionment
according
to
census
or
population,
while
in
the
other
cases
the
naked
question
was
whether
a
tax
on
business
or
on
what
is
described
as
a
tax
on
the
franchise
when
applied
to
a
corporation
was
an
excise
tax
or
not.
The
affirmative
decisions
on
this
point
are
directly
applicable
to
the
present
cases,
and
they
show
conclusively
that
in
the
United
States
as
well
as
in
England
a
tax
on
business
or
employment
is
considered
as
an
excise
tax.
The
effect
of
a
tax
on
the
manufacturer
as
in
the
case
of
the
Williams
Manufacturing
Company,
is
just
the
same
as
if
the
tax
was
imposed
on
the
goods
manufactured
in
the
one
case
or
conveyed
in
the
other;
in
both
cases
the
result
is
to
raise
the
price
of
the
commodity
and
to
cause
the
tax
to
be
paid
by
the
consumer,
or
to
reduce
the
profits
of
the
producer,
in
which
case
the
latter
has
to
pay
the
whole
or
a
portion
of
the
duty.
That
excise
taxes
are
not
direct
taxes
does
not,
it
seems,
admit
of
controversy,
at
least
at
the
present
time,
whatever
may
have
been
the
discussions
on
the
subject
at
an
early
date
of
their
imposition.
It
is
admitted
by
every
writer
on
political
economy,
whether
English,
French
or
American.
And
this
has
not
been
questioned
either
at
the
bar
or
by
any
of
the
judges
who
have
decided
the
present
cases.
_.
If
there
could
be
a
doubt
as
to
whether
the
tax
imposed
by
the
Quebec
Legislature
is
an
indirect
tax,
there
can
be
none
that
according
to
Imperial
legislation
and
American
jurisprudence
(there
seems
to
be
no
occasion
where
such
a
question
can
arise
in
the
courts
in
England),
that
it
is
an
excise
tax;
and
the
Provincial
Legislatures
have
no
more
authority
to
impose
conferred
by
the
British
North
America
Act,
we
find
that
in
an
excise
tax
than
an
indirect
tax.
If
we
now
turn
to
the
decisions
rendered
on
the
taxing
powers
Severn
&
The
Queen
(2
Supreme
Court
Reports,
p.
79),
all
the
judges
admitted
that
a
license
fee
of
$50
imposed
upon
a
brewer
was
an
indirect
tax;
at
p.
94,
Richards,
C.J.,
qualified
it
as
an
excise
tax,
when
he
said:
"‘It
is
not
doubted
that
the
Dominion
Legislature
had
the
right
to
lay
on
this
excise
tax
and
to
grant
this
license.”
In
the
case
of
the
Attorney-General
v.
The
Queen
Insurance
Co.,
(3
H.
of
L.
&
P.C.
1090)
their
Lordshops
of
the
Privy
Council
held
that
the
tax
was
not
a
direct
tax
and
that
it
was
therefore
ultra
vires.
I
understand
that
the
same
conclusion
has
been
arrived
at
by
their
Lordships
in
the
case
of
the
Attorney-General
v.
Reed,
with
reference
to
the
tax
recently
imposed
upon
legal
proceedings,
although
I
have
not
yet
seen
the
written
judgment
in
that
case.
It
was
held
that
in
those
three
cases
that
the
Provincial
Legislatures
had
no
authority
to
impose
indirect
taxes,
unless
they
came
within
the
scope
of
subsection
9
of
section
92,
and
that
the
taxes
imposed
claimed
were
not
direct
taxes.
It
will
be
said
that
in
the.
case
of
Black
&
Dow
the
Privy
Council
stated
that
there
might
be
other
taxes
imposed
under
subsection
16,
besides
those
mentioned
in
subsections
2
and
9,
but
their
Lordships
were
of
opinion
that
the
tax
claimed
was
a
direct
tax
and
therefore
it
was
not
necessary
to
decide
that
it
could
be
imposed
under
subsection
16.
When
we
consider
that
every
provision
of
the
B.N.A.
Act
shows
that
the
object
of
the
promoters
of
the
measure
was
to
place
each
Province
in
a
state
of
perfect
independence
as
regards
each
other,
to
establish
the
utmost
freedom
of
intercourse
and
commercial
relations
between
them,
to
exclude
from
the
legislative
authority
of
the
Provinces
all
regulations
as
to
trade
and
commerce,
customs
and
excise,
navigation
and’
shipping,
banks,
bankruptcy
and
insolvency—in
fact
every
subject
which
might
give
occasion
to
an
interference
by
one
Province
directly
or
indirectly
which
would
affect
the
interests
of
the
other
Provinces;
it
is
impossible
to
suppose
that
it
was
intended
to
allow
the
several
Provinces
to
raise
their
revenue
by
taxes
calculated
to
reach
the
inhabitants
of
the
other
Provinces,
their
monetary
institutions,
their
telegraphs
and
insurance
companies,
and
the
natural
or
industrial
products
of
each
other
by
duties
imposed,
not
on
the
product
themselves
(this
is
expressly
forbidden
by
the
B.N.A.
Act),
but
upon
every
Railway
Company
every
Steamship
or
other
Navigation
Company,
whose
Railways
or
Ships
should
be
employed
to
move
such
products
from
one
Province
to
another
or
to
a
foreign
market.
Such
a
pretention
is
inconsistent
with
the
whole
object
and
intent
of
the
Act,
as
disclosed
by
almost
every
disposition
which
it
contains,
and
affords
a
strong
argument
against
the
validity
of
the
present
tax.
The
words
((
Direct
taxation
within
the
Province’’
seem
to
imply
that
the
taxes
to
be
imposed
must
be
raised
from
persons
residing
or
properly
situated
within
the
Province
by
which
they
are
imposed,
and
not
otherwise;
and
it
is
a
characteristic
feature
of
direct
taxation,
that
it
is
only
raised
from
persons
residing
in
the
territory
where
they
are
imposed
or
on
property
therein
situated.
I
do
not
mention
this
as
decisive,
but
as
an
indication
of
what
was
meant
by
‘‘direct
taxation’’
in
the
British
North
America
Act.
To
pretend
that
the
present
tax
is
a
direct
tax,
would
be
to
hold
that
it
is
a
personal
or
capitation
tax.
A
capitation
tax
as
its
name
indicates,
is
a
general
tax
imposed
on
each
head
of
a
family,
or
on
every
male
inhabitant
in
the
community.
I
do
not
know
how
this
could
apply
to
a
corporation,
and
more
particularly
when
it
is
imposed
on
the
capital
of
such
corporations,
and
on
the
several
offices
which
they
have;
the
effect
of
which
would
be
that
several
capitation
taxes
might
be
imposed
on
the
same
corporation,
as
is
the
case
with
the
Merchants
Bank,
from
which
five
or
six
taxes
are
claimed,
by
reason
of
the
several
offices
it
has
in
the
Province.
Whether
this
tax
is
considered
from
the
evident
intention
of
the
framers
of
the
British
North
America
Act,
as
disclosed
by
its
enactments,
or
from
the
various
dispositions
contained
in
other
Acts
of
the
Imperial
Parliament
as
regards
similar
taxes
raised
in
England,
or
again
from
the
light
to
be
derived
from
the
decisions
of
the
Supreme
Court
and
of
the
Privy
Council,
or
from
those
of
the
United
States,
and
the
general
tenor
of
the
definitions
given
by
political
economists
on
the
subject
of
direct
and
indirect
taxation,
I
cannot
arrive
at
any
other
conclusion
but
that
the
present
taxes
must
be
held
to
be
excise
and
indirect
taxes,
which
the
Provincial
Legislatures
have
no
right
to
impose.
I
would
confirm
the
judgments
in
the
five
Bank
cases,
and
reverse
the
judgments
in
the
other
four
cases.
I
am,
however,
in
the
minority,
and
the
judgments
in
the
Bank
cases
will
be
reversed,
and
the
others
confirmed.
Cross,
J.
:—
।
The
observations
which
I
am
about
to
read
were
prepared
more
particularly
in
the
case
of
Lambe
v.
The
Ontario
Bank,
.
but
they
are
for
the
most
part
applicable
to
all
the
other
cases.
William
B.
Lambe,
License
Inspector
for
the
revenue
district
of
Montreal,
sues
the
Ontario
Bank
as
a
corporation
having
its
place
of
business
in
the
city
and
revenue
district
of
Montreal,
claiming
$1,200
as
a
tax
upon
their
banking
capital
of
$1,500,000,
and
an
additional
tax
of
$100
for
having
an
office
or
place
of
business
in
the
city
of
Montreal,
said
taxes
being
claimed
as
imposed
and
due
under
the
Statute
of
Quebec,
45
Vic.,
cap.
22,
entitled,
"‘An
Act
to
impose
certain
direct
taxes
on
certain
commercial
corporations’’,
and
which
by
sec.
3
declares
that
the
annual
taxes
imposed
upon
and
payable
by
the
commercial
corporations
mentioned
and
specified
in
section
one
of
this
act
shall
be
as
follows:
1st.
Banks.
Five
hundred
dollars
when
the
paid-up
capital
of
the
bank
is
five
hundred
thousand
dollars
or
less
than
that
sum;
one
thousand
dollars
when
the
paid-up
capital
is
from
five
hundred
thousand
dollars
to
one
million
dollars,
and
an
additional
sum
of
two
hundred
dollars
for
each
million
or
fraction
of
a
million
dollars
of
the
paid-up
capital,
from
one
million
dollars
to
three
million
dollars,
and
a
further
additional
sum
of
one
hundred
dollars
for
each
million
or
fraction
of
a
million
dollars
of
the
paid-up
capital
over
three
millions.
To
this
action
the
Ontario
Bank
pleaded
to
the
effect
that
by
section
91
of
the
British
North
America
Act
of
1867,
the
exclusive
legislative
authority
of
the
Parliament
of
Canada
extended
among
other
things
to:
2.
The
regulation
of
trade
and
commerce;
3.
The
raising
of
money
by
any
mode
or
system
of
taxation;
15.
Banking,
Incorporation
of
banks,
and
the
issue
of
paper
money.
By
section
92
of
the
same
act,
in
each
province,
the
legislature
might
exclusively
make
laws
for
among
other
things:
2.
Direct
taxation
within
the
province,
in
order
to
the
raising
of
a
revenue
for
provincial
purposes;
beyond
which
no
power
of
taxation
was
granted
to
the
legislature
of
any
province.
The
Ontario
Bank
held
its
charter
under
the
Dominion
statute,
34
Vic.,
cap.
5,
entitled
‘‘An
act
relating
to
banks
and
banking’’,
amended
by
subsequent
acts.
Their
capital
of
one
million
five
hundred
thousand
dollars
was
held
and
owned
by
shareholders,
whereof
two-thirds
resided
out
of
the
province
of
Quebec.
Their
chief
place
of
business
was
in
Toronto,
Ontario,
where
more
than
two-thirds
of
their
capital
was
employed,
and
about
a
third
in
the
province
of
Quebec;
that
under
the
powers
conferred
by
their
charter,
they
did
business
and
had
offices
and
agencies
throughout
the
Dominion
and
beyond
the
Province
of
Quebec;
that
the
tax
in
question
was
not
direct
within
the
meaning
of
said
92nd
section
of
the
British
North
America
Act.
It
interfered
with
the
regulation
of
trade
and
of
banking
by
imposing
restrictions
thereon;
that
it
affected
persons
beyond
the
limits
of
the
Province
of
Quebec;
that
it
purported
to
be
regulated
by
the
amount
of
the
paid-up
capital
used
and
held
beyond
the
limits
of
the
Province;
it
was
unjust,
partial
and
discriminating
against
one
set
of
persons
for
the
benefit
of
another
set.
That
by
reason
of
what
was
so
pleaded
the
Act
of
the
legislature
of
Quebec,
under
which
said
tax
purported
to
be
imposed,
was
illegal,
unconstitutional
and
ultra
vires.
The
demand
being
based
on
the
provincial
statute
to
which
it
refers,
and
there
being
no
dispute
about
the
facts
set
forth
in
the
plea,
an
admission
was
made
of
the
essential
statements
it
contained,
and
the
issues
thus
raised
were
submitted
upon
arguments
made
by
the
parties
to
the
Superior
Court,
which,
by
its
judgment,
held
that
the
statute
of
the
Province
of
Quebec,
45
Vic.,
c.
22,
in
so
far
as
it
imposed
the
tax
in
question,
was
unconstitutional
and
ultra
vires.
Hence
the
present
appeal
brought
by
the
license
inspector.
A
preliminary
question
was
raised,
that
the
statute
of
Quebec
invoked
was
a
nullity
and
had
no
existence
in
law,
because
passed
in
the
name
of
the
Queen
in
place
of
the
legislature
of
Quebec.
I
have
not
thought
it
necessary
to
discuss
this
point,
having
no
doubt
that
the
statute
was
formally
sanctioned
by
all
the
legislative
power
of
the
province
and
so
sufficiently
appears
on
the
face
of
it.
I
think
I
am
warranted
in
not
treating
this
point
as
serious.
The
main
question
raised
is
purely
one
of
law,
viz.:
Whether
the
statute
of
Quebec,
45
Vict.,
cap.
22,
in
so
far
as
it
imposes
the
tax
in
question
is
within
the
power
of
the
provincial
legislature.
The
debatable
ground
as
to
the
relative
powers
of
the
Dominion
and
provincial
legislatures
has
been
narrowed
by
the
number
of
decisions
which
have
been
rendered
on
subjects
nearly
approaching
the
one
now
under
discussion.
In
Severn
v.
The
Queen,
12
Supreme
Court
(Can.)
Rep.
701
a
provincial
statute
requiring
a
brewer
to
take
out
and
pay
a
sum
of
money
for
a
license
for
permission
to
carry
on
his
business
was
held
to
be
in
conflict
with
the
power
of
the
Dominion
parliament
to
regulate
trade,
and
also
that
it
was
an
indirect
tax.
In
the
case
of
the
Attorney-General
v.
The
Queen
Insurance
Co.
113
L.R.,
H.
of
L.
and
P.C.
cases,
p.
1097;
1
L.N.
4101
it
was
held
that
the
statute
of
Quebec,
the
Quebec
License
act
of
1875,
39
Vic.,
c.
8,
was
virtually
a
stamp
act
and
that
the
tax
thereby
imposed
was
an
indirect
tax.
In
the
case
of
the
Citizens
Insurance
Co.
v.
Parsons,
7
L.R.,
H.
of
L.
and
P.C.
cases,
p.
109,
5
L.N.
25,
it
was
held
that
the
terms,
property
and
civil
rights
13thly
enumerated
in
sec.
92
of
the
British
North
America
Act,
included
rights
arising
from
contracts
where
not
explicitly
mentioned
as
comprised
in
any
of
the
powers
conceded
to
the
Dominion
legislature
under
sec.
91
;
that
for
the
protection
of
property
and
civil
rights
within
the
province,
a
local
legislature
could
impose
conditions
to
contracts
of
insurance
becoming
operative
within
the
province.
In
Russell
v.
The
Queen,
7
L.R.,
H.
of
L.
and
P.C.
cases,
p.
335;
5
L.N.
234,
it
was
determined
that
the
Canada
Temperance
Act
of
1878,
does
not
belong
to
the
class
of
subjects
included
by
the
denomination
of
property
and
civil
rights
in
the
enumeration
of
powers
attributed
to
the
provincial
legislatures
by
sec.
92
of
the
British
North
America
act.
In
the
City
of
Fredericton
v.
The
Queen,
3
Supreme
Court
(Can.)
Rep.,
p.
505,
it
was
determined
that
the
Canada
Temperance
Act
of
1878
was
within
the
competency
of
the
Dominion
legislature,
which
alone
had
the
power
to
pass
such
an
act
in
virtue
of
their
power
to
regulate
trade
and
commerce.
In
Hodge
v.
The
Queen,
9
L.R.,
H.
of
L.
and
P.C.
cases,
p.
117;
7
L.N.
18,
it
was
held
that
the
Ontario
License
Act
of
1877,
authorizing
the
adoption
of
resolutions
in
the
nature
of
police
or
municipal
regulations
or
by-laws,
fixing
the
hours
for
selling
liquors
and
keeping
open
billiard
tables,
were
of
a
local
character
for
the
good
government
of
taverns,
&c.,
and
did
not
interfere
with
the
general
regulation
of
trade
and
commerce,
and
was
within
the
powers
of
the
provincial
legislature.
These
decisions
will
still
leave
considerable
room
for
discussion
as
to
the
relative
powers
of
the
Dominion
and
Provincial
legislatures,
and
the
fixing
of
an
exact
line
of
demarcation
between
them,
which
it
appears
difficult
to
reach
on
any
general
principle,
and
has
consequently
in
part
to
be’
considered
in
relation
to
each
individual
case
which
seems
to
present
a
doubt,
and
that
now
under
discussion
may
be
fairly
reckoned
as
one
of
such
cases,
that
is,
a
case
not
wholly
settled
by
any
previous
decision.
although
its
determination
is
doubtless
aided
by
the
principles
laid
down
in
the
previous
decisions.
It
is,
therefore,
yet
an
open
question
whether
the
tax
in
question,
imposed
in
virtue
of
the
statute
of
Quebec,
45
Vict.
cap.
22,
purporting
to
authorize
the
levy
of
what
it
terms
direct
taxes
on
the
paid-up
capital
of
banks
doing
business
within
the
province,
is
ultra
vires;
and
whether
said
statute,
in
so
far
as
it
purports
to
impose
such
tax,
is
unconstitutional.
It
may
be
assumed
that
the
power
of
taxation
by
an
independent
sovereign
state,
is
unlimited
as
regards
the
persons
and
property
falling
within
its
jurisdiction.
The
powers
we
have
to
consider
are
derived
from
a
plenary
source,
and
have
to
be
construed
as
falling
within
the
limits
of
the
grant
by
which
they
are
conferred.
Whether
the
powers
conveyed
are
in
the
aggregate
plenary,
being
distributed,
that
is
divided
between
two
authorities,
the
Dominion
and
the
Provincial,
they
cannot
be
plenary
to
each,
but
the
division
has
been
so
contrived
as
to
be
in
part
exclusive
to
each,
and
in
some
particulars
it
must
be
conceded
common
to
each.
The
terms
in
which
these
powers
are
conveyed
are
of
necessity
very
general
for
the
most
part,
and
although,
as
regards
certain
of
them,
a
clear
distinction
may
be
obvious,
yet
there
are
others
which
seem
to
run
into
and
over-
lap
each
other,
rendering
it
difficult
to
obtain
a
clear
line
of
demarcation.
The
powers
of
the
provinces
are
exceptional,
and
are
enumerated,
save
as
to
No.
16,
which
comprises
generally
all
matters
of
a
merely
local
or
private
nature
in
the
province.
The
powers
of
the
Dominion
are
general:
To
make
laws
for
the
peace,
order
and
good
government
of
Canada,
in
relation
to
all
matters
not
coming
within
the
classes
of
subjects
assigned
exclusively
to
the
provinces,
but
for
certainty,
although
not
to
restrict
the
generality
of
the
powers
conceded,
an
enumerated
class
of
subjects
under
twenty-nine
heads
are
assigned
exclusively
to
the
Dominion,
none
of
which
subjects
are
to
be
deemed
of
a
local
or
private
nature,
as
assigned
to
the
provinces
under
section
92.
It
follows
that
the
powers
of
the
provinces
are
restricted
to
those
specially
enumerated
in
section
92
as
assigned
to
them,
and
are
limited
by
the
terms
and
conditions
on
which
the
concession
is
made.
They
are
further
restricted
by
the
exercise
of
the
Dominion
enumerated
powers
specially
given
by
section
91,
which
may
conflict
with
the
enumerated
powers
of
the
provinces
assigned
to
them
as
specified
under
section
92.
Where
exclusive
powers
seem
to
have
been
given
to
both,
as
in
the
case
of
direct
taxation,
then,
with
due
consideration
of
the
above
qualification,
the
provisions
so
conflicting
must
be
read
together
so
as
to
give
reasonable
effect
to
both,
especiali
where
such
seems
necessary
for
the
working
of
the
Act.
With
the
aid
of
these
inferences
drawn
from
the
terms
of
the
statute,
and
making
allowance
for
the
ground
covered
by
the
decided
cases,
there
is
still
much
room
for
controversy
in
the
eases
that
are
continually
arising
in
relation
to
these
relative
powers.
The
experience
of
the
United
States
of
America
and
the
judicial
decisions
rendered
there
on
constitutional
questions,
are
naturally
looked
to
as
of
value
in
solving
questions
arising
under
our
constitution.
One
consideration
of
importance
to
be
kept
in
view
in
the
application
of
decided
cases
there,
as
precedents
for
us,
is
that
with
them
each
state
was
considered
as
originally
possessed
of
sovereign
authority
over
persons
and
property
within
its
jurisdiction.
That
in
forming
their
confederation
all
powers
not
specially
conferred
or
surrendered
to
the
general
government
were
reserved
to
the
States.
The
British
North
America
confederation
proceeds
from
an
opposite
standpoint,
on
the
opposite
theory,
providing,
as
in
effect
it
does,
that
all
powers
not
expressly
conferred
on
the
local
or
provincial
legislatures
are
attributed
to
that
of
the
Dominion.
The
power
of
the
state
governments
in
the
United
States
is
relative
to
the
United
States
government
greater
than
that
of
the
provinces
to
the
Dominion;
yet
it
has
been
held
uniformly
by
the
Supreme
Court
of
the
United
States,
that
the
general
government
was
possessed
of
certain
implied
powers
convenient
or
necessary
for
carrying
on
the
functions
of
the
government.
and
that
within
their
sphere
the
government
of
the
Union
was
supreme.
Cooley
on
Taxation,
at
p.
57,
No.
3,
says
the
means
or
agencies
provided
or
selected
by
the
federal
government
as
necessary
or
convenient
for
the
exercise
of
its
functions,
cannot
be
subject
to
the
taxing
power
of
the
states.
The
states
cannot
tax
a
bank
chartered
by
congress
as
the
fiscal
agent
of
the
government,
in
support
of
which
he
cites
the
case
so
often
referred
to,
of
McCullough
v.
The
State
of
Maryland,
et
al.,
4
Wheaton
Supreme
Court
Rep.,
p.
316,
where
it
was
held
that
the
state
government
had
no
right
to
tax
any
of
the
constitutional
means
employed
by
the
government
of
the
Union
to
execute
its
constitutional
powers.
The
states
had
no
power,
by
taxation
or
otherwise,
to
retard,
impede,
hinder,
bind,
or
in
any
manner
control
the
operation
of
the
constitutional
laws
enacted
by
congress
to
carry
into
effect
the
powers
vested
in
the
national
government.
The
bank
in
question
in
that
case
was
a
quasi-commercial
enterprise
owned
in
a
great
part
by
private
shareholders,
yet
it
was
chartered
as
a
United
States
bank,
and
was
the
financial
agent
of
the
government.
C.
J.
Marshall,
who
pronounced
the
judgment,
among
other
remarks,
stated
in
effect,
that
although
no
express
authority
was
given
by
the
constitution
of
the
United
States,
either
to
create
corporations
or
to
establish
banks,
and
although
it
was
conceded
that
the
inherent
power
of
taxaton
remained
with
the
people
of
each
state
to
the
full
extent
to
which
it
had
not
been
alienated,
although
the
federal
government
itself
could
exercise
no
powers
but
those
granted
to
it,
which
were
enumerated
powers,
yet
the
government
of
the
union,
limited
as
it
certainly
was,
nevertheless
was
supreme
within
its
sphere;
that
although
among
their
enumerated
powers
were
not
to
be
found
that
of
establishing
a
bank
or
creating
a
corporation,
yet
as
an
attribute
of
sovereignty
it
could
create
corporations,
and
as
a
means
to
carry
into
effect
the
objects
of
the
government
with
which
they
were
entrusted,
it
could
establish
banks,
and
the
agencies
of
those
banks
throughout
the
United
States
were
not
subject
to
taxation
by
the
state
power;
that
the
act
to
incorporate
the
Bank
of
the
United
States
was
made
in
pursuance
of
the
constitution,
and
was
part
of
the
supreme
law
of
the
land
;
that
the
tax
imposed
on
this
bank
by
the
state
of
Maryland
was
incompatible
and
repugnant
to
the
constitutional
laws
of
the
Union;
that
it
was
a
franchise
created
by
the
United
States
congress
within
their
exclusive
attribute
of
powers,
and
what
they
had
a
right
to
do,
the
state
government
had
no
right
to
undo;
that
the
power
of
the
United
States
to
create
implied
a
power
to
preserve;
that
a
power
in
the
state
of
Maryland
to
tax
the
bank
created
by
the
United
States
would
be
a
power
to
destroy,
and
if
wielded
by
a
different
hand
would
be
incompatible
with
the
power
to
create
and
preserve;
that
when
such
repugnance
existed
the
authority
which
was
supreme
should
control
and
not
yield
to
that
over
which
it
is
supreme.
He
further
remarked:
If
the
states
could
tax
one
instrument
employed
by
the
government
in
the
execution
of
its
powers,
they
might
tax
any
and
every
other
institution.
They
might
tax
the
mail
;
they
might
tax
the
mint:
they
might
tax
patent
rights;
they
might
tax
the
papers
of
the
custom
house;
they
might
tax
judicial
proceedings;
they
might
tax
all
the
means
employed
by
the
government.
It
was,
however,
conceded
in
that
case
that
the
denial
of
the
state
power
to
tax
did
not
extend
to
the
real
estate
of
the
bank,
nor
to
the
interest
of
the
shareholders
resident
within
the
state
imposing
a
tax
upon
their
property
in
shares.
In
Weston
v.
Charleston,
2
Peters
Rep.,
p.
467,
it
was
held
that
the
State
Legislature
could
not,
by
taxation
or
otherwise,
retard,
impede,
burden
or
in
any
manner
control
the
operation
of
the
constitutional
laws
enacted
by
Congress
to
carry
into
execution
the
powers
vested
in
the
general
government.
In
the
case
of
Osborn
v.
The
Bank
of
the
United
States,
9
Wheaton,
738,
it
was
held
that
a
State
cannot
tax
the
Bank
of
the
United
States,
and
that
any
attempt
on
the
part
of
its
agents
and
officers
to
enforce
the
collection
of
such
tax
against
the
property
of
the
bank
would
be
restrained
by
injunction.
In
Brown
v.
The
State
of
Maryland,
12
Wheaton,
448,
C.
J.
Marshall
says:
We
admit
the
power
to
be
sacred,
the
State
power
to
tax
its
own
citizens
or
their
property
within
its
own
territory,
but
we
cannot
admit
that
it
may
be
used
so
as
to
obstruct
the
free
course
of
a
power
given
to
Congress.
In
the
case
of
Railroad
Co.
v.
Penniston,
18
Wallace,
U.S.R.,
it
was
held
by
a
majority
of
the
judges
that
a
tax
upon
a
railway
company
incorporated
by
Congress
to
run
through
several
States,
imposed
by
the
State
on
property
of
the
company
within
the
State,
was
valid,
but
a
tax
upon
the
operations
of
the
company
being
a
direct
obstruction
to
the
exercise
of
federal
power
could
not
be
allowed;
thus
making
a
distinction
between
a
tax
on
the
franchise
and
a
tax
upon
the
property.
The
minority
of
the
judges
were
of
opinion
that
the
tax
even
on
the
property
of
the
company,
although
within
the
taxing
State,
was
invalid.
In
applying
to
the
present
case
the
principles
that
run
through
these
decisions
I
think
it
must
be
assumed
that
where,
by
the
British
North
America
Act,
the
Dominion
Government
are
given
an
exclusive
power,
it
stands
in
the
same
relation
to
the
power,
and
is
entitled
to
the
same
protection
from
the
courts
as
the
power
conceded
to
the
Congress
of
the
United
States
for
the
exercise
of
their
functions
of
government.
Moreover,
we
find
no
instance
where
an
express
power
given
to
the
Congress
of
the
United
States
has
been,
by
the
sanction
of
the
courts,
interfered
with
by
taxation
or
otherwise
by
the
State
power.
If
the
power
of
the
Dominion
Legislature
be
exclusive
for
the
regulation
of
trade
and
commmerce,
and
in
the
matter
of
banking
and
the
incorporation
of
banks,
and
the
power
of
the
Provincial
Legislatures
limited
to
direct
taxation
and
the
issue
of
certain
classes
of
licenses,
it
follows
that
banks
created
by
the
Dominion
Legislature,
for
the
purpose
of
doing
business
throughout
the
Dominion,
cannot
be
taxed,
retarded,
impeded,
burdened
or
in
any
manner
controlled
by
the
operation
of
any
enactments
of
the
Provincial
Legislatures.
The
same
should
hold
good
as
regards
the
regulation
of
trade
and
commerce,
at
least
as
to
general
trade
and
commerce
of
public
or
general
interest
to
the
Dominion.
This
is
evidently
the
view
adopted
on
the
subject
in
the
United
States.
Cooley,
at
p.
162,
remarks:
When,
therefore,
it
is
held
that
a
power
to
tax
is
at
the
discretion
of
the
authority
which
wields
it,
a
power
which
may
be
carried
to
the
extent
of
an
annihilation
of
that
which
it
taxes,
and,
therefore,
may
defeat
and
nullify
any
authority
which
may
elsewhere
exist
for
the
purpose
of
protection
and
preservation,
it
follows
as
a
corollary
that
the
several
States
cannot
tax
the
commerce
which
is
regulated
under
the
supremacy
of
Congress.
Burroughs
on
Taxation,
p.
93,
sec.
64,
Regulation
of
Commerce:
The
constitution
provides
that
Congress
shall
have
power
to
regulate
commerce
with
foreign
nations,
and
among
the
several
States,
and
with
the
Indian
tribes.
*
*
*
The
doctrine
is
now
firmly
established
that
the
taxing
power
of
the
States,
while
it
may
be
exercised
upon
all
property
within
their
limits,
upon
the
goods
carried
or
the
instruments
of
commerce
as
property,
and
thus
indirectly
affect
commerce,
yet
where
the
tax
law
amounts
to
a
regulation
of
commerce
it
is
void
because
in
conflict
with
the
power
granted
to
Congress,
which,
when
exercised,
is
exclusive
and
supreme.
It
was
admitted
in
these
American
cases,
as
in
fact
the
powers
by
the
constitution
reserved
to
the
States,
permitted,
each
of
the
States
the
right
to
create
banks
and
other
corporations
of
their
own,
and
to
tax
such
institutions
of
their
own
creation,
but
the
power
to
tax
a
United
States
bank
as
such,—that
is,
on
its
existence
or
its
operations,
in
other
words,
its
franchise
or
capacity
to
do
business—was
always
denied
and
held
to
be
unconstitutional.
If,
therefore,
a
bank
of
the
United
States
could
not
be
taxed
by
State
power,
nor
thereby
retarded,
impeded,
hindered,
or
in
any
manner
controlled,
by
the
same
process
of
reasoning
it
follows
that,
in
a
matter
where
the
Dominion
Government
has
been
attributed
exclusive
authority,
the
Provincial
Government
cannot
be
permitted
to
render
its
exercise
nugatory
by
assuming
to
tax
the
legitimate
operations
of
that
Dominion
Government
acting
within
the
sphere
of
its
attributes.
The
same
rule
should
hold
good
where
the
tax
affects
trade
and
commerce,
at
least
the
general
trade
of
the
country.
The
Provincial
statute,
45
Vic.,
cap.
22,
now
in
question,
is
the
renewal,
with
an
extension
of
the
subjects,
of
the
attempt
made
to
raise
revenue
from
insurance
companies
under
the
statute
of
Quebec
39
Vic.,
c.
7.
The
proposed
exaction
being
now,
by
the
former
of
these
acts,
styled
a
direct
tax;
the
first
attempt
proved
futile,
the
tax
being
held
unconstitutional
by
the
decision
in
the
case
of
The
Attorney-General
v.
The
Queen
Insurance
Co.
The
fact
that
it
is
now
called
a
direct
tax
will
not
alter
its
nature,
nor
do
I
think
add
to
its
validity.
It
seems
to
me
that
the
tax
in
question
is
open
to
a
further
objection
by
the
want
of
territorial
jurisdiction
in
the
Quebec
Legislature
over
the
subject
of
taxation.
By
the
terms
of
enumeration
2
of
sec.
92
of
the
British
North
America
act,
"Direct
taxation
within
the
Province,”
the
Provincial
Legislature
is
not
entitled
to
exercise
its
taxing
power
on
objects
beyond
the
territorial
limits
of
the
Province.
The
statute
of
Quebec,
45
Vic.,
cap.
22,
sec.
1,
purports
to
impose
the
tax
on
every
bank
carrying
on
the
business
of
banking
in
this
Province,
and
under
sec.
3
the
rate
of
tax
is
scheduled
according
to
the
amount
of
its
paid-up
capital.
The
respondent
is
a
bank
incorporated
by
act
of
Parliament,
and
holds
its
present
charter
under
the
Dominion
statute,
54
Vic.,
cap.
5,
and
amendments.
Its
head
office
is
at
Toronto
in
Ontario.
Its
paid-up
capital
is
located
at
Toronto,
and,
so
far
as
being
Provincial
property,
is
within
the
jurisdiction
of
Ontario.
It
is
true
that
it
is
represented
in
the
Province
of
Quebec
by
its
agents
there,
and
it
employs
some
of
its
capital
in
the
Province
of
Quebec.
These
agents
and
the
capital
employed
in
the
Province
of
Quebec
are
within
its
local
jurisdiction,
and
as
such
may
be
proper
subjects
of
taxation
within
its
Provincial
power,
but
they
are
not
taxed
as
such;
on
the
contrary,
it
is
the
paid-up
capital
of
the
bank,
its
franchise
or
capacity
to
do
business,
which
is
attempted
to
be
taxed,
and
which
is
not
within
the
jurisdiction
of
the
Province
of
Quebec.
If
the
franchise
or
capital
were
taxable
within
the
Province
of
Quebec,
it
would
be
much
more
legitimately
taxable
in
Ontario,
and
would
be
equally
taxable
in
each
of
the
Provinces
in
which
the
bank
might
open
an
agency,
so
that
it
might
come
to
be
taxed
for
the
necessities
of
seven
several
Provincial
Governments,
as
well
as
liable
to
a
like
visitation
from
the
federal
power.
This,
again,
would
not
interfere
with
direct
taxation
of
its
property
within
the
province.
In
such
case,
would
any
or
all
of
these
taxes
be
direct?
and
if
any,
which?
Now,
although
duplicate
taxation
is
not
impossible,
the
law
generally
presumes
against
it,
even
within
the
same
jurisdiction;
see
Cooley
on
Taxation,
p.
105;
nor
do
I
think
that
it
would
be
tolerated,
that
by
coercion
of
the
agency
within
its
limits,
a
Provincial
Government
could
lay
a
tax
on
a
franchise
or
property
beyond
its
limits.
A
Government
with
plenary
powers
might
exercise
such
indirect
coercion,
but
it
is
altogether
inapplicable
to
the
circumstances
of
the
present
case.
The
principle
of
confederation
necessarily
implied
that
one
Province
would
not
interfere
with
the
taxable
subjects
or
property
of
another
Province,
hence
the
qualifying
words
'within
the
Province”
in
No.
2
of
sec.
92
include
this
limitation,
which
would
have
been
implied
from
the
circumstances
had
even
this
express
qualification
been
omitted.
Cooley,
at
p.
15,
says
the
power
of
taxation,
however
vast
in
its
character
and
searching
in
its
extent,
is
necessarily
limited
to
subjects
within
the
jurisdiction
of
the
State.
These
subjects
are
persons,
property
or
business.
And
at
p.
14
he
says
taxation
and
protection
are
reciprocal.
A
personal
tax
cannot
be
assessed
against
a
nonresident;
neither
can
the
property
of
a
non-resident
be
taxed
unless
it
has
an
actual
situs
within
the
State.
In
the
case
of
Leprohon
v.
The
City
of
Ottawa,
Cartwright,
p.
635,
in
the
Court
of
Appeals,
Ontario,
Mr.
Justice
Paterson
says:
The
restrictions
confine
such
taxation
within
the
Province.
I
think
this
has
not
been
questioned.
The
paid-up
capital
of
a
bank
is
necessarily
a
very
fallacious
data
for
taxation.
At
the
very
outset
of
the
business
of
the
bank
the
capital
must
of
necessity
have
been
diminished
by
preliminary
expenses.
If
prosperous
in
business,
its
assets
must
come
to
exceed
its
paid-up
capital
;
if
the
reverse,
its
paid-up
capital
is
an
unfair
basis
of
taxation.
When
the
franchise
is
taxed,
it
is
usually
on
its
estimated
value
as
a
facility
for
doing
business.
In
Burroughs
on
Taxation,
p.
164,
he
says:
The
right
of
the
corporation
to
exist
and
exercise
the
powers
vested
in
it
by
its
charter
is
called
its
franchise;
and
at
p.
166,
§
85,
Tax
on
Franchise
:
This
tax
is
in
its
essential
nature
the
same
as
the
license
tax,
and
the
same
principle
as
to
the
powers
of
the
State
to
tax
applies
to
domestic
corporations
when
they
are
first
chartered
as
applies
to
foreign
corporations.
Again,
at
p.
174,
§
87,
Capital;
How
Taxed
(that
is,
of
corporations)
:
Corporations
are
sometimes
taxed
on
their
normal
capital,
and
sometimes
on
its
actual
value.
When
taxed
on
its
nominal
capital,
the
tax
is
on
the
whole
amount
paid
in
or
secured
to
be
paid,
without
reference
to
losses.
The
capital
is
referred
to
as
a
measure
of
the
price
to
be
paid
for
the
franchise.
In
the
case
of
a
foreign
corporation,
the
bonus
or
tax
is
the
amount
paid
for
the
privilege
of
exercising
its
corporate
powers
in
the
State.
In
the
case
of
a
domestic
corporation,
it
is
the
amount
paid
as
the
price
of
its
corporate
existence.
It
only
exists
by
the
permission
of
the
State,
and
the
State
may
prescribe
the
terms
on
which
it
will
grant
its
permission.
From
this
it
would
appear
to
have
been
held
in
the
United
States
that
the
State
power
can
tax
the
franchise
of
a
corporation
created
without
the
State,
but
only
on
the
ground
of
its
being
a
license
or
permission
to
do
business
within
the
State,
but
the
taxing
power
of
a
State
exceeds
that
of
a
Province.
It
extends
to
the
regulation
of
trade
in
the
State,
and
to
all
powers
of
taxation
not
expressly
surrendered
by
the
State.
It
is
not
by
its
charter
limited
to
taxation
within
the
State.
This
doctrine,
I
apprehend,
would
be
inapplicable
to
the
circumstances
of
the
Provinces
and
their
relations
to
the
Dominion.
It
would
be
likely
to
lead
to
mischief,
and
I
think
ought
to
be
open
to
question
even
in
the
United
States.
In
the
case
of
Paul
v.
Virginia,
6
Wallace,
p.
168,
it
was
held
that
corporations
were
creations
of
local
law,
and
had
not
even
an
absolute
right
of
recognition
in
other
States,
but
depended
for
that
and
for
the
enforcement
of
their
contracts
upon
the
assent
of
the
State
(where
their
contracts
were
sought
to
be
enforced),
which
might
be
given
accordingly,
on
such
terms
as
they
pleased.
In
the
present
case,
what
has
been
attempted
to
be
taxed
has
not
been
brought
within
the
jurisdiction
of
the
Legislature
of
the
Province
of
Quebec.
The
tax
is
on
its
paid-up
capital
whose
situs
is
without
the
Province.
As
to
whether
the
tax
is
direct
or
indirect,
I
entertain
no
doubt
in
my
mind
that
it
is,
in
its
nature,
a
very
indirect
tax.
It
is
not
on
property
nor
on
persons,
and
it
has
to
be
collected
not
directly
from
the
object
taxed,
but
indirectly
by
operating
on
the
agency
and
property
which
the
corporation
may
have
in
the
Province,
not
certainly
from
its
franchise
or
paid-up
capital,
therefore
to
my
mind
very
manifestly
indirect;
but
on
the
general
question
as
to
what
are
direct
and
what
are
indirect
taxes,
I
have
found
it
difficult
to
arrive
at
any
well
defined
recognized
line
of
distinction.
As
near
as
I
can
arrive
at
what
should
be
reckoned
a
direct
tax,
it
is
one
levied
immediately
on
property
or
persons
and
perhaps
on
income.
I
doubt
whether
in
any
case
a
tax
on
corporation
or
company
as
such,
that
is,
on
its
capacity
to
exist
and
to
do
business,
could
be
ranked
in
either
of
those
classes.
If
its
proper
situs
were
without
the
jurisdiction
of
the
taxing
power,
it
could
not
be
legally
taxed.
In
any
case
its
shares
held
within
the
province
and
any
of
its
property
there
situate,
would
as
such
be
liable
to
taxation
in
the
same
manner
as
other
corporations
and
companies
would
be
open
to
the
objection
of
property
pertaining
to
individuals.
The
taxation
of
domestic
duplicate
taxation,
and
would
to
my
mind
be
an
indirect
tax,
as
one
in
the
nature
of
a
license
imposed
upon
their
capacity
to
exist
and
do
business,
and
which
would
have
been
classed
as
a
license
tax
had
it
been
intended
to
empower
the
levying
of
it,
on
the
provincial
government.
I
am
not
quite
certain
that
their
lordships
of
the
Privy
Council
did
not
intend
to
decide
squarely
in
the
case
of
the
Attorney-General
v.
The
Queen
Insurance
Company,
that
a
tax
of
the
nature
of
the
one
now
in
question
was
unconstitutional
in
whatever
form
imposed,
whether
called
a
direct
tax
or
by
whatever
name
it
was
intended
to
be
levied.
They
certainly
ruled
in
that
case
that
the
tax
was
indirect,
and
as
regards
classification
I
cannot
distinguish
it
from
the
one
now
in
question.
They
also
held
that
the
act
in
question
was
virtually
a
stamp
act,
although
in
name
a
license
act.
The
case
of
Severn
v.
The
Queen
seems
also
directly
in
point.
Whoever
remembers
the
general
sense
in
which
the
subject
was
discussed
in
the
press
and
by
politicians
before
and
at
the
time
of
confederation,
will
have
little
difficulty
in
recognizing
the
nature
of
direct
taxation
as
then
understood,
at
least
in
the
then
province
of
Canada.
They
doubtless
had
in
view
the
example
and
received
construction
of
the
terms
in
the
United
States,
the
burden
was
looked
upon
as
one
which
would
fall
upon
real
estate.
The
charges
of
government
had
been
sustained
for
the
most
part
by
customs
duties
on
imports,
to
which
something
had
been
added
by
the
license
power.
Except
for
municipal
purposes,
for
the
most
part
in
the
cities,
there
had
been
no
imposts
on
property
or
persons.
As
expenses
of
the
government
increased,
there
was
an
apprehension
that
these
might
have
to
be
resorted
to.
A
resort
to
this
mode
of
raising
revenue
was
looked
upon
as
an
extreme
measure,
and
one
likely
to
be
very
unpopular,
but
of
possible
necessity,
not
likely
to
be
resorted
to
so
long
as
the
government
could
exist
and
carry
on
its
functions
by
only
taxing
imports.
In
forming
the
confederation
the
danger
must
have
been
foreseen
of
allowing
the
local
governments
the
power
of
indirect
taxation.
It
would
obviously
be
their
interest
to
exist
and
defray
their
charges
by
imposts
upon
the
trade
of
the
country,
more
especially
the
through
trade,
and
their
inclination
would
naturally
lead
them
to
avoid
a
direct
charge
on
their
constituents.
It
was
of
importance
that
trade
should
not
be
embarrassed
by
local
burdens,
hence
its
regulation
was
assigned
to
the
Dominion.
I
cannot
think
that
a
tax
upon
corporations
or
companies
as
such,
can
be
considered
a
direct
tax,
more
especially
on
those
having
their
proper
situs
without
the
province,
nor
can
such
tax
be
held
legal
in
the
face
of
the
other
reasons
already
stated.
I
therefore
concur
in
the
judgment
rendered
in
this
case
by
the
Superior
Court.
I
hold
that
the
tax
in
question
in
this
cause
is
unconstitutional
and
void,
and
that
the
judgment
of
the
Superior
Court
in
this
case
should
be
confirmed.
I
am,
however,
with
the
Chief
Justice
in
the
minority
as
regards
the
opinion
entertained
by
this
court.
TESSIER,
J
.
:—
Après
les
longues
dissertations
faites
par
mes
collègues
qui
m’ont
précédé
et
les
nombreux
précédents
et
autorités
qui
ont
été
cités
et
commentés,
il
est
assez
évident
que
la
matière
est
épuisée
et
je
ne
veux
pas
m’exposer
à
faire
des
observations
qui
ne
seraient
qu’une
répétition
de
ce
qui
a
été
dit.
Je
me
contenterai
de
mentionner
brièvement
les
propositions
qui
résument
mon
opinion.
1.
L’acte
de
la
Confédération
a
conféré
des
pouvoirs
distincts
en
certains
cas
et
des
pouvoirs
concurrents
en
certains
autres
cas
au
parlement
fédéral
et
aux
législatures
provinciales.
Les
législatures
provinciales
sont
des
gouvernements
qui
ont
les
droits
et
privilèges
inhérents
à
l’exercice
d’un
gouvernement
;
la
mention
spéciale
de
certains
droits
particuliers
dans
la
section
92—n’est
qu'énonciative,
surtout
en
considérant
la
sous-section
16
qui
dit:
"‘et
généralement
toutes
les
matières
d’une
nature
purement
locale
ou
privée
dans
la
Province.”
Le
droit
de
taxer
pour
prélever
un
revenu
et
payer
les
dépenses
publiques
n’est
pas
un
attribut
de
la
souveraineté
sous
la
constitution
anglaise,
mais
un
droit
inhérent
des
parlements
et
législatures
qui
sont
des
gouvernements
représentatifs
du
peuple.
Dans
la
cause
de
La
Reine
&
Hodge,
l’un
des
juges
du
Conseil
Privé
s’est
exprimé
ainsi
:
"‘Dans
les
limites
de
sa
juridiction
et
dans
la
sphère
de
ses
pouvoirs,
la
législature
locale
est
suprême
et
a
la
même
autorité
que
le
parlement
impérial
ou
le
parlement
de
la
puisance
auraient
dans
les
mêmes
circonstances
pour
conférer,
à
une
institution
municipale,
ou
à
un
corps
de
sa
creation,
l’autorité
de
faire
des
règlements
ou
de
passer
des
résolutions
relatives
aux
sujets
spécifiés
en
cette
section
ou
pour
la
mettre
en
opération
et
en
assurer
l’effet.”
2.
La
taxe
en
question
en
cette
cause
est
une
taxe
directe;
il
est
vrai
que
l’acte
de
la
Confédération
ne
définit
ce
que
c’est
qu’une
taxe
directe,
ni
aucune
de
nos
lois.
La
présente
taxe
n’est,
après
tout,
qu’une
contribution
mobilière
ou
une
taxe
les
personnes
ou
la
taxe
indirecte
sur
les
marchandises
importées,
mobilière
qui
n’est
qu’une
taxe
directe.
Ce
qui
est
le
plus
certain,
c’est
qu’à
part
la
taxe
directe
sur
c’est
que
sur
toutes
les
autres
taxes
les
économistes
ne
s’accordent
pas
et
sont
en
contradiction,
comme
le
dit
Cooley,
on
Taxation,
p.
0:
"‘The
term
direct
taxes
is
employed
in
a
peculiar
sense
in
the
Federal
Constitution,’’
en
Angleterre,
en
France
et
aux
Etats-Unis,
lorsqu’il
s’agit
de
les:
classer
en
taxe
directe
ou
indirecte.
Les
définitions
aux
Etats-Unis
ne
peuvent
s’appliquer
ici.
Comme
dit
M.
Leroy-Beaulieu,
dans
son
‘‘Traité
de
la
science
des
Finances’’
tome
1er,
p.
214;
après
avoir
démontré
que
la
définition
des
impôts
directs
et
indirects,
donnée
par
l’administration,
dans
différents
pays,
n’est
pas
toujours
exacte,
il
propose
la
suivante
comme
étant
la
plus
scientifique
et
la
plus
satisfaisante
qu
’il
ait
pu
trouver
:
‘‘Par
l’impôt
direct
le
législateur
se
propose
d’atteindre
immédiatement
du
premier
bond
et
proportionnellement
à
sa
fortune
ou
à
ses
revenus,
le
véritable
contribuable
;
il
supprime
donc
tout
intermédiare
entre
lui
et
le
fisc,
et
il
cherche
une
proportionnalité
rigoureuse
de
l’impôt
à
la
fortune
ou
aux
facultés.
Par
V
impôt
indirect
le
législateur
ne
vise
pas
immédiate-
.
ment
le
véritable
contribuable
et
ne
cherche
pas
à
lui
imposer
une
charge
strictement
proportionnelle
à
ses
facultés
:
il
ne
se
propose
d’atteindre
le
vrai
contribuable
que
par
ricochet,
par
contre-coup,
par
répercussion:
11
met
des
intermédiaires
entre
lui
et
le
fisc,
et
renonce
à
une
stricte
proportionnalité
de
l’impôt
dans
le
cas
particuliers,
se
contentant
d’une
proportionnalité
relative
en
général.”
M.
Passy,
qui
a
fourni
au
Dictionnaire
de
l’Economie
Politique,
publié
par
MM.
Coquelin
et
Guillaumin,
l’article
traitant
de
L’impôt,
dit
aussi:
"‘C'est
un
usage
reçu
de
diviser
les
impôts
en
deux
catégories
distinctes.
On
appelle
directs
ceux
que
les
contribuables
acquittent
eux-mêmes
pour
leur
propre
compte:
on
appelle
indirectes
ceux
dont
certains
d’entre
eux
ne
font
que
l’avance
et
dont
ils
obtiennent
le
remboursement
des
mains
d’autres
personnes.
’
’
Mill—Principles
of
Political
Economy,
Livre
5,
ch.
3,
sect.
1,
nous
dit
:
“Taxes
are
either
direct
or
indirect.
A
direct
tax
is
one
which
is
demanded
from
the
very
persons
who,
it
is
intended
or
desired
should
pay
it.
Indirect
taxes
are
those
which
are
demanded
from
one
person
in
the
expectation
and
intention
that
he
shall
indemnify
himself
at
the
expense
of
another:
such
are
the
excise
or
customs.’’
Walker—Science
of
Wealth,
p.
338:
"A
direct
tax
is
demanded
of
the
person
who
it
is
intended
shall
pay
it.
Indirect
taxes
are
demanded
from
one
person,
in
the
expectation
that
he
will
indemnify
himself
at
the
expense
of
others.’’
Tel
est
le
système
qui
est
le
plus
généralement
adopté
aujourd’hui.
Une
compagnie
incorporée
n’est
qu’une
personne
juridique
dans
le
sens
de
nos
lois;
cela
est
défini
dans
notre
code
civil,
art.
17,
sous
section
11—"
"
Le
mot
personne
comprend
les
corps
politiques
et
incorporés.’’
En
interprétant
ces
définitions
il
me
paraît
évident
que
c’est
une
taxe
directe
sur
la
personne
juridique
ou
légale
qui
paie
directement
la
taxe.
L’actionnaire
est
atteint
directement,
parce
qu'il
est
confondu
avec
la
corporation
comme
membre
de
cette
corporation.
C’est
le
capital
commun
de
la
corporation
qui
est
taxé.
Ce
n’est
pas
une
licence
ni
une
taxe
sur
la
franchise,
parce
que
rien
dans
cette
loi
en
question
n’empêche
la
banque
de
continuer
ses
transactions;
chaque
part
ni
les
affairs
de
la
compagnie
incorporée
ne
sont
taxées.
3.
Quelque
soit
l’opinion
théorique
des
économistes
sur
les
taxes
directes
ou
indirectes,
la
taxe
actuelle
est
une
taxe
que
la
législature
de
Québec
avait
le
pouvoir
d’imposer,
en
prenant
l’ensemble
de
notre
constitution.
En
disant
que
la
législature
a
le
droit
d’imposer
les
taxes
directes,
il
me
semble
qu’on
a
voulu
simplement
consacrer
que
les
législatures
provinciales
n’auraient
pas
le
droit
d’imposer
de
taxes
sur
les
importations.
qui
est
le
grand
exemple
reconnu
de
la
taxe
indirecte.
En
mettant
la
question,
si
la
taxe
en
question
en
cette
cause
sera
payée
indirectement
par
d’autres,
comme
dans
le
cas
de
marchandises
importés,
on
peut
dire
que
cette
taxe
sur
le
capital
des
sociétés
ou
compagnies
incorporées
est
une
taxe
directe
qui
n’affecte
que
la
corporation
et
non
pas
les
personnes
qui
font
affaires
avec
elle.
Les
actionnaires
et
la
compagnie
incorporée
ne
font
qu’un,
c’est
la
même
personne
formant
un
être
unique
juridiquement.
Quant
à
l’objection
que
le
capital
les
banques
et
autres
compagnies
incorporées
est
en
plus
grande
partie
situé
hors
de
la
province,
c’est
une
objection
spécieuse,
mal
fondée;
le
capital
d’une
banque
n’est
pas
divisible,
il
est
censé
exister
en
entier
et
répondre
en
entier
pour
les
affaires
où
il
y
a
un
bureau
ouvert.
Par
exemple,
un
déposant
qui
dépose
mille
piastres
dans
la
Banque
du
Commerce
à
Montréal
a
droit
de
se
fier
à
tout
le
capital
de
cette
banque
et
a
recours
pour
la
remise
de
son
dépôt
contre
le
capital
entier
da
la
banque,
quoique
cette
banque
emploie
une
grande
partie
de
son
capital
dans
la
province
d’Ontario.
Par
un
effet
de
la
loi,
une
banque
ou
une
compagnie
incorporée
transporte
tout
son
capital
dans
tous
les
lieux
où
elle
transige
des
affaires.
Il
y
a
des
actionnaires
résidant
hors
de
la
province,
en
Angleterre,
aux
Etats-Unis,
cela
ne
fait
rien,
il
n’y
a
qu'un
être
moral
et
juridique
dans
lequel
sont
confondus
tous
les
actionnaires,
n’importe
où
ils
résident.
Par
exemple,
supposons
que
le
parlement
fédéral
ait
impose
la
même
taxe
dont
il
est
ici
question,
sur
les
banques,
ces
institutions
pourraient-elles
éviter
de
payer
ces
taxes,
en
alléguant
que
partie
de
leurs
actionnaires
demeurent
en
Angleterre
ou
ailleurs,
et
que
partie
de
leur
capital
est
engagée
dans
un
de
leurs
bureaux
établis
en
Angleterre
ou
aux
Etats-Unis?
Evidemment,
cette
objection
serait
rejetée;
pourquoi
ne
le
serait-elle
pas,
lorsqu’il
s’agit
de
la
même
taxe
imposée
par
la
législature
de
Québec?
L’acte
de
la
Confédération
a
été
fait
dans
le
but
de
concilier
les
intérêts
et
les
droits
de
province
pré-existant;
cet
acte
doit
être
libéralement
interprété.
Ce
n’est
qu’une
alliance
fédérale,
dans
laquelle
chaque
province
a
été
constituée
avec
un
gouvernement
régulier
;
ces
provinces
doivent
raisonnablement
et
libéralement
avoir
le
droit
de
se
maintenir
et
de
prélever
les
revenus
nécessaires
à
leur
maintien.
Si
on
eut
voulu
limiter
les
pouvoirs
des
législatures
provinciale
à
certains
sujets
particuliers,
pourquoi
n’aurait-on
pas
défini
ces
pouvoirs
et
dit
ensuite
que
tous
les
autres
pouvoirs
appartenaient
au
Parlement
Fédéral.
Au
contraire,
il
a
fallu
spécifier
dans
la
section
91
les
pouvoirs
particuliers
de
ce
parlement
dans
certains
cas,
comme
dans
un
traité
entre
deux
parties
indépendantes
qui
spécifie
les
droits
appartenant
à
chacune
des
deux.
Les
compagnies
incorporées
forment
une
classe
générale
de
gens
qui
exercent
dans
l’Etat
des
privilèges
de
commerce
sans
être
responsables
sur
leurs
propres
biens
comme
les
autres
individus,
mais
avec
limitation
de
responsabilité.
Ce
n’est
que
Juste
qu'ils
contribuent
aux
revenus
de
la
province
dans
laquelle
ils
font
affaires
dans
un
but
de
profit.
A
mon
avis,
l’acte
de
la
Confédération
est
un
modèle
de
législation
que
j’ai
toujours
admiré.
Il
a
fallu
un
grand
effort
de
science,
d’intelligence
et
d’expérience
pour
avoir
compris
dans
une
loi
de
147
articles
le
règlement
des
intérêts
si
variés
de
plusieurs
provinces
couvrant
un
immense
territoire,
avec
des
systèmes
de
loi
différents.
Les
termes
généraux
dont
on
s’est
servi
montrent
qu’on
a
voulu
donner
une
élasticité
nécessaire
dans
notre
constitution.
C’est
à
nos
tribunaux
de
donner
une
interprétation
raisonnable
pour
concilier
tous
les
intérêts
et
non
pour
créer
et
favoriser
ceux
qui
sont
disposés
à
élever
des
conflits.
Il
me
semble
parfaitement
raisonnable
que
ces
compagnies
incorporées,
qui
ont
la
protection
des
lois
provinciales,
qui
profitent
de
nos
lois
de
police
et
municipales,
fournissent
leur
part
de
revenu
pour
le
soutien
de
notre
gouvernement
provincial.
Je
concours
volontiers
dans
le
jugement
de
cette
cour,
qui
maintient
cette
taxe
comme
étant
constitutionnelle;
elle
n’est
pas
excessive,
elle
est
raisonnable
et
justifiable,
et
je
crois
qu’elle
doit
être
maintenue.
RAMSAY,
J
.
:—
One
of
the
learned
counsel
who
addressed
the
court
said
that.
instead
of
getting
clearer,
the
dividing
line
between
federal
and
local
powers
was
getting
more
obscure.
Unfortunately
this
pessimist
view
of
the
matter
is
not
altogether
unreal.
Opinions
are
very
divergent,
and
many
of
those
who
are
qualified
to
speak,
and
who,
moreover,
are
entitled
to
speak
with
authority
on
the
subject,
seem
to
disagree
irreconcilably
on
questions
of
the
utmost
importance.
This
is
not
altogether
satisfactory,
it
must
be
confessed;
it
is
our
duty,
however,
not
to
be
discouraged
but
to
strive
manfully
to
find
out
the
solution
of
all
these
difficulties.
Some
solution
there
must
be;
and
it
will
be
discovered
by
those
alone
who
seek
for
truth
and
not
for
triumph;
and,
above
all,
by
those
who
are
not
seeking
to
further
some
cherished
political
dream
or
selfish
project.
In
deprecating
certain
kinds
of
discussion,
it
does
not
follow
that
one
dreads
strife,
or
is
alone
content
to
see
a
cautious
reserve
or
a
lethargic
indifference.
On
the
contrary,
it
is
salutary
that
every
possible
position
should
be
debated
with
the
utmost
zeal,
and
with
the
keenest
logic.
What
is
to
be
deplored
is
the
waste
of
time
and
effort,
and
sometimes
talent,
which
could
be
turned
to
better
account,
in
sustaining
impossible
themes
or
in
circulating
irritating
subtleties.
If
confederation
is
to
be
a
success
we
must
interpret
the
constitution
with
the
utmost
loyalty.
In
great
measure
the
responsibility
of
this
task
devolves
upon
the
courts.
At
all
events,
there
the
questions
in
their
most
abstract
form
present
themselves,
and
therefore
it
is
that
every
judicial
utterance
on
this
subject
should
be
given
forth
under
the
sanction
of
the
gravest
responsibility.
We
are
dealing,
not
with
a
trifling
statute
passed
to
regulate
some
paltry
concern,
but
with
the
Constitution
of,
perhaps,
a
great
nation.
Speaking
with
the
fullest
consciousness
of
this
responsibility,
I
do
not
hesitate
to
say
that
to
pretend
that
the
Acts
of
1774
and
1791
have
any
direct
bearing
on
the
interpretation
to
be
given
to
the
B.N.A.
Act
appears
to
me
to
be
neither
loyal
nor
honest.
Again,
to
magnify
the
powers
of
the
Federal
Parliament,
by
a
forced
interpretation
of
the
Constitutional
Act,
so
as
to
absorb
almost
all
the
local
powers,
is
disloyal
and
dishonest.
Being
of
this
mind
I
adopt
unreservedly
the
doctrine
put
forth
by
those
opposed
to
the
tax
complained
of,
when
they
say,
that
the
powers
of
the
provinces
are
all
to
be
found
consigned
in
the
Constitutional
Act
and
its
amendments;
and
by
parity
of
reasoning
it
must
be
admitted
that
the
federal
powers
are
derived
from
the
same
source.
We
may
say
of
Canada,
as
C.
J.
Marshall
said
of
the
United
States,
and
with
greater
emphasis:
"‘This
government
is
acknowledged
by
all
to
be
one
of
enumerated
powers;’’—McCulloch
v.
State
of
Maryland,
4
Wheaton,
405.
Hence
we
have
the
doctrine
everywhere
proclaimed
that
the
local
legislatures
are
as
omnipotent
within
the
spheres
of
their
powers
as
the
Dominion
Parliament
is
within
its
jurisdiction.
It
would
be
difficult
to
arrive
at
any
other
conclusion,
for
when
the
Queen,
Lords
and
Commons
give
a
power
it
cannot
be
questioned
by
any
other
authority.
The
extent
of
the
grant
may
alone
be
questioned.
Lest
it
be
thought
that
I
unwittingly
neglect
advice
proffered
by
high
authority,
I
shall
at
once
refer
to
a
dictum
of
the
Privy
Council
which
now
especially
demands
our
attention,
and
which,
it
appears
to
me,
may
be
easily
misunderstood.
In
the
case
of
The
Queen
Insurance
Co.
&
Parsons,
3
H.
of
L.
and
P.C.,
1090;
22
L.C.J.,
307;
1
Leg.
News,
410,
their
lordships
said,
referring
to
the
difficulty
of
arriving
at
the
proper
interpretation
of
the
language
of
sects.
91
and
92
:
"‘In
performing
this
difficult
duty
it
will
be
a
wise
course
for
those
on
whom
it
is
thrown
to
decide
each
case
as
best
they
can,
without
entering
more
largely
upon
an
interpretation
of
the
statute
than
is
necessary
for
the
decision
of
the
particular
question
in
hand.
If
this
rule
were
adopted
literally
it
would
be
the
enthronement
of
empiricism.
But
it
is
to
be
observed
that
their
lordships
only
gave
this
caution
when
dealing
with
the
dangers
of
the
double
enumeration
of
sections
91
and
92,
and
the
evident
misuse
of
the
word
exclusively
in
each
section.
The
warning
was
against
making
precedents
before
experience
had
given
a
guide
as
to
the
working
of
the
new
constitution,
and
I
invoke
it
as
an
admission
of
great
authority,
that
the
work
of
reconciling
these
conflicting
expressions
must
go
on
till
all
the
possible
cases
have
been
disposed
of.
The
special
application
of
this
admission
will
appear
more
clearly
later
on.
From
another
quarter
we
have
recently
received
an
intimation
as
to
our
duty,
which
also
demands
our
notice,
and
requires
qualification.
The
learned
Chief
Justice
of
the
Supreme
Court
is
reported
to
have
said
that
all
the
Courts
in
Canada
were
bound
by
the
decisions
of
the
Supreme
Court.
In
this
saying
there
is
just
that
grain
of
truth
which
is
dangerous.
It
is
a
rhetorical
rather
than
a
legal
way
of
putting
the
matter.
‘‘
Aiunt
rhetor
es,
judicatum
esse
partem
juris."
There
is
no
such
institution
of
the
law
as
that
laid
down.
The
decision
binds
in
the
particular
case;
it
is
only
a
rule
of
authority
in
other
cases.
Now
the
basis
of
authority
is
reason,
and,
therefore,
that
only
which
is
reasonable
is
authoritative.
It
is
doubtless
very
inconvenient
that
jurisprudence
should
be
uncertain,
but
it
would
be
still
more
inconvenient
if
courts,
out
of
an
obsequious
deference,
adopted
as
law
that
which
clearly
is
not
law.
In
practice
we
follow
a
middle
course,
which,
while
it
tends
to
avoid
the
perpetuation
of
error,
to
some
extent
renders
the
administration
of
justice
certain.
Volumes
of
over-ruléd
cases
and
the
dicta
of
very
distinguished
judges
and
jurists
attest
the
correctness
of
this
remark.
In
Hogan
et
al.
&
Bernier
(21
L.C.J.
101)
a
very
able
judge,
now
no
more,
referring
to
the
case
of
Dorion
&
Hyde,
said:
‘‘Je
ne
me
crois
pas
lié
par
ce
précédent,
et
je
regretterais
de
donner
mon
concours
à
l’établissement
d’une
jurisprudence
que
je
crois
erronée.’’
The
precedent,
which
Mr.
Justice
Dorion
deemed
himself
justified
in
rejecting
as
authoritative,
was
a
judgment
of
the
Court
of
Appeal
confirming
a
judgment
of
his
own
court
in
review.
To
this
I
shall
only
add
what
Hale
says
on
the
point:
‘‘It
is
true
the
decisions
of
courts
of
justice,
though
by
virtue
of
the
laws
of
this
realm
they
do
bind,
as
a
law
between
the
parties
thereto,
as
to
the
particular
case
in
question,
till
reversed
by
error
or
attaint,
yet
they
do
not
make
a
law,
properly
so
called,
for
that
only
the
king
and
parliament
can
do;
yet
they
have
a
great
weight
and
authority
in
expounding,
declaring
and
publishing
what
the
law
of
this
kingdom
is,
especially
when
such
decisions
hold
a
consonancy
and
congruity
with
resolutions
and
decisions
of
former
times.’’
Hist.
of
Common
Law,
chap.
4,
vol.
2,
p.
142.
I
allude
to
this
specially
as
the
authority
of
precedents
has
been
particularly
insisted
on
in
these
arguments,
and
it
seems
to
me
well
to
observe
that
two
things
are
to
be
examined
when
considering
a
precedent:
1.
Whether
it
is
precisely
in
point.
2.
Whether
it
will
stand
the
test
of
reason.
And
in
deciding
as
to
this
last,
whether
it
has
been
assented
to
at
all
times.
The
case
of
Angers
&
The
Queen
Ins.
Co.
has
been
relied
upon
as
conclusive
authority
against
the
validity
of
the
present
tax.
To
me
it
appears
to
decide
absolutely
nothing
that
has
to
be
decided
in
this
case.
Firstly,
then,
let
us
examine
what
was
submitted
to
the
Privy
Council,
and
what
was
decided
there.
When
the
case
came
before
us,
only
two
propositions
were
submitted,
(1)
whether
the
tax
was
a
direct
tax,
and
consequently
under
par.
2,
of
sect.
92;
(2)
whether
it
was,
as
it
was
called.
a
license,
under
par.
9.
Here
it
was
held,
unanimously,
that
the
particular
impost
then
in
question
was
not
direct
taxation,
and,
by
the
majority,
that
it
was
not
a
license
within
the
terms
of
par.
9.
This
decision
was
confirmed
by
the
Privy
Council.
Had
the
determination
of
these
issues
been
all
the
scope
given
to
the
case,
the
decision
might
not
have
done
much
mischief,
but
unfortunately
one
of
the
learned
judges
in
this
court,
in
delivering
his
opinion
entered
upon
a
discussion
of
political
economy,
purporting
to
be
supported
by
quotations,
which
was
evidently
intended
to
lay
down
a
general
and
authoritative
distinction
between
direct
and
indirect
taxation
in
all
cases.
It
is
an
ungracious
task
to
criticize
a
work
which
necessitated
considerable
labour
on
the
part
of
its
author;
but
it
has
obtained
some
recognition,
and
to
my
mind
it
seems
so
fallacious
that
I
deem
it
my
duty
to
combat
its
method
and
its
conclusions
on
the
first
opportunity.
I
may
add
to
this,
that
the
speculations
on
the
subject
of
political
economy,
which
it
is
sought
to
incorporate
into
the
law
as
recognized
truths,
are
peculiarly
liable
to
misconception.
Archbishop
Whately,
in
his
lectures
on
political
economy,
recommends
the
student
to
consider
"
‘
a
clear
definition
of
technical
terms,
and
careful
adherence
to
the
sense
defined
as
the
first—the
most
important—and
the
most
difficult
point
in
the
science
of
political
economy,’’
Lect.
IX.
Disregarding
all
such
caution
it
was
unhesitatingly
asserted
that
all
the
authors
were
agreed,
French,
English
and
American,
legal
and
lay,
on
the
line
of
demarcation,
between
direct
and
indirect
taxation.
Strictly
speaking,
with
the
writings
of
political
economists
we
have
nothing
to
do.
If
a
technical
meaning
is
to
be
given
to
a
word
or
words
in
a
statute,
that
meaning
must
be
proved
by
testimony
and
not
by
books,
like
every
other
fact.
We
do
not
even
accept
foreign
law,
of
which
the
course
of
our
studies
might
enable
us
to
know
something
on
the
authority
of
books;
how
then
could
we
be
expected
to
guard
ourselves
from
error
if
we
attempted
to
deal
with
the
technicalities
of
particular
sciences,
of
which
we
may
be
presumed
to
be
perfectly
ignorant,
on
scraps
culled
from
the
works
of
speculative
writers?
I
do
not,
then,
feel
myself
obliged
to
show
that
the
scientific
writings
submitted
to
us
do
not
sustain
conclusively
the
theories
they
were
brought
forward
to
support;
but
the
course
followed
in
the
case
of
Angers
v.
The
Queen
Ins.
Co.
illustrates
so
fully
the
evil
of
neglecting
the
ordinary
rule
I
invoke
that
I
shall
not
hesitate,
once
for
all,
(to
protest
against
an
evil
practice,
not
to
create
a
precedent),
to
point
out
the
errors
to
which
it
has
given
rise.
It
was
evidently
expected
that
we
should
understand
that
the
division
between
direct
and
indirect
taxes
was
this,
that
a
direct
tax
was
one
which
the
person
who
paid
it
was
not
expected
to
get
out
of
another;
while
an
indirect
tax
was
one
for
the
payment
of
which
he
expected
to
be
recouped.
That
this
was
the
lesson
supposed
to
be
taught,
and
on
which
all
the
economists
were
said
to
be
agreed,
is
beyond
question,
for
it
was
repeated
several
times
at
the
argument
of
the
cases
now
before
us.
In
one
place
Mill
says
something
like
this.
I
quote
from
the
passage
on
which
Mr.
Justice
Taschereau
relied
to
show
that
he
agreed
with
everybody
and
everybody
with
him:
"‘A
direct
tax
is
one
which
is
demanded
from
the
very
person
who
it
is
intended
or
desired
should
pay
it.
Indirect
taxes
are
those
which
are
demanded
from
one
person
in
the
expectation
and
intention
that
he
shall
idemnify
himself
at
the
expense
of
another,
such
as
the
excise
or
the
customs,”
etc.
But
this
brilliant
writer
carries
his
doctrine
out,
for
he
adds:
"‘Most
taxes
on
expenditure
are
indirect,
but
some
are
direct,
being
imposed,
not
on
the
producer
or
seller
of
an
article,
but
immediately
on
the
consumer.”
Now
how
does
this
test
correspond
with
what
Adam
Smith
says:
"‘A
direct
tax
operates
and
takes
effect
independently
of
consumption
or
expenditure,
while
indirect
taxes
affect
expenses
or
consumption,
and
the
revenue
arising
from
them
is
dependent
thereon.’’
These
systems,
then,
are
totally
different,
and,
I
take
it,
neither
indicates
the
meaning
of
parliament
in
enacting
par.
2,
sec.
91,
B.N.A.
Act.
Again,
many
of
the
economists,
and
Mill
amongst
them,
classify
taxes
into
direct
and
indirect.
However,
in
Hylton
v.
The
United
States,
Chase,
J.,
said:
"‘I
believe
some
taxes
may
be
both
direct
and
indirect
at
the
same
time.’’
Mill
also
says,
"‘The
financial
systems
of
most
countries
comprise
a
variety
of
miscellaneous
imposts
not
directly
included
in
either
class,’’
i.e.,
of
direct
or
indirect
taxes:
Pr.
of
Pol.
Econ.,
chap.
V,
p.
1.
The
legal
definitions
in
France
of
contributions
directes
et
indirectes
do
not
cover
the
whole
ground
of
taxation.
See
what
Merlin
says
as
to
the
droits
d’enregistrement.
He
shows
they
are
not
indirect
under
the
definition,
and
certainly
they
are
not
direct
according
to
their
system.
Turning
to
the
French
system,
no
similarity
can
be
expected
between
the
French
and
English
writers,
for
the
former
write
under
laws
which
leave
little
room
for
doubt
as
to
what
is
a
direct
tax
in
France,
and
what
an
indirect
one.
In
one
of
the
scraps
quoted
from
Say,
he
tells
us
this;
and
a
note,
on
the
very
next
page
to
that
quoted
by
Mr.
Justice
Taschereau,
is
specially
inserted
to
prevent
the
cursory
reader
making
the
mistake
into
which
the
Privy
Council
all
but
irretrievably
fell.
Merlin
and
Favard
de
Langlade
are
also
perfectly
clear
on
the
point.
In
fact
it
is
difficult
to
understand
how
any
one
could
have
copied
extracts
from
these
precise
writers
without
seeing
that
they
were
exposing
a
definite,
and
to
some
degree
an
arbitrary
rule,
and
not
playing
with
theories.
In
England
there
are
no
legal
writers
on
this
subject,
for
there
is
no
legal
distinction
between
the
two
imposts,
and
the
economists
use
the
terms
direct
and
indirect
rather
to
describe
the
incidence
of
the
impost,
which
is
often
influenced
by
circumstances
over
which
the
legislature
has
no
control,
and
which
it
does
not
even
contemplate,
than
to
define
terms
or
to
make
an
abstract
classification.
Mr.
Dudley
Baxter
admits
this:—
"‘One
of
the
oldest
and
most
simple
definitions
divides
all
taxes
into
the
two
heads
of
direct
and
indirect
taxation;
direct
taxes
being
those
which
are
paid
by
the
person
himself
who
is
meant
to
be
the
real
contributory,
such
as
assessed
taxes,
and
indirect
being
those
which
are
paid
by
an
intermediary,
who
reimburses
himself
from
the
real
contributor,
such
as
the
customs
and
excise
duties.
But
this
definition
cannot
furnish
us
with
a
trustworthy
classification,
since
it
is
founded
upon
an
accident
in
the
manner
of
payment
and
not
upon
the
nature
of
the
taxes
themselves.
The
income
and
property
tax,
for
instance,
is
direct
taxation
when
paid
by
the
owner
himself,
and
indirect
when
paid
by
the
tenant
or
mortgagor.
‘
‘
The
Taxation
of
the
Kingdom
:
R.
Dudley
Baxter,
page
20.
It
is
otherwise
in
the
United
States
a
direct
tax
is
imposed
differently
from
an
indirect
one.
Art.
1,
sec.
9,
par.
4.
Hence
the
courts
have
been
called
upon
to
designate
the
classes
in
order
to
decide
whether
the
impost
is
legal
or
not.
In
France
the
question
comes
before
the
courts
in
diametrically
the
reverse
way,
for
there
a
tax
becomes
direct
or
indirect,
not
by
any
quality
in
the
nature
of
the
tax,
but
by
the
mode
of
its
imposition.
In
France
it
is
not
a
question
of
expenditure
or
recoupment,
but
whether
the
tax
is
on
the
person
or
on
a
product.
Thus
the
taxes
on
industries
(patentes)
are
all
direct,
while
the
tax
on
theatre
tickets
is
indirect:
After
saying
what
is
quoted
by
Taschereau,
J.,
p.
421,
Say
goes
on
to
establish
the
real
distinction
in
France,
p.
522
:
"‘Pour
asseoir
les
contributions
directes
en
proportion
du
revenu
des
contribuables,
tantôt
les
gouvernements
exigent
des
particuliers
l’exhibition
de
leurs
baux,
etc.,
et
demandent
au
propriétaire
une
part
de
ce
revenu;
c’est
la
contribution
foncière.
"‘Tantôt
ils
jugent
du
revenu
par
le
loyer
de
l’habitation
que
l’on
occupe,
par
le
nombre
des
domestiques,
des
chevaux,
des
voitures
qu’on
entretient,
et
font
de
cette
évaluation
la
base
de
leurs
demandes:
c’est
ce
qu’on
nomme
en
France
la
contribution
mobilière.
“Tantôt
ils
estiment
les
profits
que
l’on
peut
faire
suivant
l’espèce
d’industrie
que
l’on
exerce,
l’étendue
de
la
ville
et
du
local
où
elle
est
exercée:
c’est
la
base
de
l’impôt
qu’on
appelle
en
France
les
patentes.
“Toutes
ces
manières
d’asseoir
l’impôt,
en
font
des
contributions
directes.
“Pour
asseoir
les
contributions
indirectes
et
celles
dont
on
veut
frapper
les
consommations,
on
ne
s’informe
pas
du
nom
du
redevable;
on
ne
s’attache
qu’au
produit.
Tantôt,
des
l’origine
de
ce
produit
on
réclame
une
part
quelconque
de
sa
valeur,
comme
on
fait
en
France
pour
le
sel.
“Tantôt
cette
demande
est
faite
au
moment
où
le
produit
franchit
les
frontières
(les
droits
de
douanes)
ou
l’enceinte
des
villes
(l’octroi).
“Tantôt
c’est
au
moment
où
le
produit
passe
de
la
main
du
dernier
producteur
dans
celle
du
consommateur,
qu’on
fait
contribuer
celui-ci,
(en
Angleterre
par
le
stamp
duty,
en
France
par
l’impôt
sur
les
billets
de
spectacles).
“Tantôt
le
gouvernement
exige
que
la
marchandise
porte
une
marque
particulière
qu’il
fait
payer,
comme
le
contrôle
de
l’argent,
le
timbre
des
journaux.
"‘Tantôt
il
s’empare
de
la
préparation
exclusive
d’une
marchandise,
ou
d’un
service
public,
et
les
vend
à
un
prix
monopole,
comme
le
tabac
ou
le
transport
des
lettres
par
la
poste.
Tantôt
il
frappe,
non
la
marchandise
elle-même,
mais
l’acquittement
de
son
prix,
comme
il
le
fait
par
le
timbre
des
quittances
et
des
effets
de
commerce.
11
Toutes
ces
manières
de
lever
les
contributions
les
rangent
dans
la
classe
des
contributions
indirectes,
parce
que
la
de-
produit,
à
la
marchandise
frappée
de
l’impôt.”
[Note
de
mande
n’en
est
adressée
a
personne
directement,
mais
au
l’auteur.]
‘‘Et
non
parce
qu’elles
atteignent
indirectement
le
contribuable;
car,
si
elles
tiraient
leur
dénomination
de
cette
dernière
circonstance,
il
faudrait
donner
le
même
nom
à
des
contributions
très
directes,
comme,
par
exemple,
à
l’impôt
des
patentes,
qui
tombe
en
partie
indirectement
sur
le
consommateur
des
produits
dont
s’occupe
la
patente.’’
The
similarity
of
the
systems
and
the
unanimity
of
writers
on
the
subject,
generally
speaking,
is
the
wildest
delusion,
it
appears
to
me
;
but
there
is
one
point
common
to
the
legal
systems
existing
in
France
and
in
the
United
States,
not
unimportant
to
us,
which,
curious
to
say,
has
escaped
the
notice
of
our
economist
jurists.
The
common
principle
to
which
I
refer
is
this,
that
the
division
between
direct
and
indirect
taxation
is
necessarily
arbitrary.
In
France
it
is
formally,
and
in
the
United
States
practically
so.
In
the
case
of
Hylton
v.
The
United
States,
Hamilton
attempted
to
lay
down
a
scientific
basis
for
the
distinction,
but
Chase,
J.,
was
not
misled
either
by
the
eloquence
or
the
ingenuity
of
that
distinguished
advocate,
and
he
expressed
the
opinion
that,
within
the
meaning
of
the
constitution,
a
direct
tax
was
on
the
person
and
on
land,
and
perhaps,
on
revenue.
This
has
since
been
confirmed
in
Springer
v.
United
States
(102
U.S.
Reports),
from
which
we
learn
that
Hamilton’s
opinion
was
really
in
favour
of
the
judgment
in
the
Hylton
case.
Now
with
us
there
is
no
doubt
that
a
tax
on
revenue
is
of
the
same
nature
as
a
tax
on
land,
and
consequently
if
the
one
is
direct
taxation
so
is
the
other.
At
the
argument
a
strange
proposition
was
advanced,
namely,
that
a
poll-tax
is
not
a
direct
tax
unless
it
is
general.
It
is
Mill
who
says
that
if
a
tax
is
not
general
it
may
be
avoided,
and
therefore
it
is
not
direct
taxation.
His
reasoning
is,
that
if
you
tax
carpenters
and
not
masons,
the
carpenters
may
all
become
masons.
We
need
not
inquire,
fortunately
for
us,
how
this
accords
with
the
consumer
argument
already
mentioned,
but
what
he
says
only
illustrates
more
fully
what
I
have
adverted
to
already,
that
the
English
economists
are
not
dealing
with
a
term
but
are
speculating
on
results
which
the
terms
direct
and
indirect
do
not
express
adequately;
and
that
if
we
were
to
be
guided
by
what
they
say,
there
would
be
no
means
of
arriving
at
a
conclusion
as
to
what
constitutes
direct
taxation,
and
we
should,
therefore,
be
obliged
to
say
that
there
was
no
such
thing.
By
a
similar
process
of
reasoning,
we
could
more
easily
arrive
at
the
conclusion
that
there
was
no
such
thing
as
indirect
taxation,
and
by
a
little
development
of
this
plastic
logic
we
might
perhaps
arrive
at
the
happy
delusion
that
we
are
not
taxed
at
all.
The
passage
from
Mill
to
which
I
refer,
is
in
Book
v.,
ch.
iii.,
§
3,
Prin.
of
Political
Economy.
It
is
only
too
clear
that
there
is
no
scientific
distinction
between
direct
and
indirect
taxation,
even
if
we
might
properly
consult
scientific
books
to
learn
the
value
of
technical
terms.
But
without
the
aid
of
the
writers
on
political
economy
we
must
define
it,
as
it
has
become
a
law
term
with
us.
I
am
not
aware
that
there
is
any
reason
for
me
to
modify
what
I
said
in
Angers
v.
The
Queen
Insurance
Co.
with
regard
to
this
matter,
for
although
the
late
Master
of
the
Rolls,
in
giving
the
judgment
of
the
Privy
Council,
seemed
to
be
influenced
to
some
extent
by
the
apparent
unanimity
of
the
writers,
he
very
guardedly
decided
that
‘‘such
a
stamp
imposed
by
the
legislature
is
not
direct
taxation.’’
I
have
no
difficulty
in
conforming
myself
to
this
dictum.
It
is
precisely
what
we
all
held
here.
With
regard
to
the
other
question
decided
in
that
case,
namely,
whether
license
or
not,
it
does
not
arise
in
this
case.
We
therefore
come
to
the
first
point
we
have
to
decide,
whether
the
tax
now
in
question
is
within
the
ruling
of
the
case
of
Angers
&
The
Queen
Insurance
Co.
or
not,
and
if
not,
whether
it
is
direct
taxation
within
the
meaning
of
the
B.N.A.
Act?
On
the
first
part
of
this
question
there
is
hardly
room
for
a
difference
of
opinion.
In
the
former
case
the
tax
was
levied
on
anyone
who
might
insure.
The
present
tax
is
on
every
Canadian
bank,
&c.,
doing
business
in
the
Province
of
Quebec,
and
the
measure
of
the
charge
is
the
paid-up
capital
of
the
bank.
There
is
also
a
business
tax.
At
the
argument
the
contention
that
the
tax
was
not
direct
seemed
ultimately
to
be
confined
to
the
consideration
that
it
was
not
a
tax
on
property
within
the
province,
or
on
the
property
of
persons
residing
in
the
province,
or
even
a
tax
on
property,
but
that
it
was
a
tax
on
the
franchise.
I
presume
that
a
tax
on
the
franchise
means
a
tax
on
those
privileges
which
go
to
make
up
the
corporation,
and
consequently
it
is
a
tax
on
the
person.
If
the
position
be
correct
that
any
tax
on
the
person,
his
property
or
his
revenue
is
direct
taxation,
in
the
meaning
of
the
B.N.A.
Act
(and
there
is
no
decision
contravening
it),
then
a
tax
on
the
franchise
of
a
corporation
is
a
direct
tax,
for
a
corporation
is
a
person.
The
law
of
this
province
lays
down
in
express
terms
that
‘‘every
corporation
legally
constituted
is
an
artificial
or
ideal
person
*
*
*
enjoying
certain
rights
and
liable
to
certain
obligations
(352
C.C.).
They
are
also
subject
to
certain
disabilities
(364
C.C.).
I
understand
that
these
articles
express
correctly
the
law
of
England
on
this
subject
as
well
as
our
law.
Smith’s
Mercantile
Law,
Chap.
4.
There
is
certainly
nothing
in
our
law
which
could
possibly
suggest
the
idea
that
a
corporation
might
not
be
made
liable
to
a
personal
tax,
and
assuming
the
law
of
England
to
be
the
same,
I
am
forced
to
the
conclusion
that
a
tax
on
the
person,
or
on
the
franchise
of
a
corporation,
is
no
exception
to
the
general
rule
of
sub-sect.
2,
sect.
92.
Of
course
in
the
United
States
a
tax
on
the
franchise
could
not
be
direct
taxation
within
their
constitution;
because
it
could
not
be
adjusted
according
to
the
census.
And
this
explains
the
case
of
the
Bank
of
Commerce
v.
New
York
City;
(2
Black,
628),
and
also,
I
presume,
the
case
mentioned
by
Hilliard
(Law
of
Taxation,
ch.
1,
par.
36,
p.
20),
reported
86
Conn.
(512-528),
which
I
have
not:
seen.
What
I
understand
to
be
laid
down
by
these
cases
is
this:—
A
tax
on
nominal
value
is
not
a
tax
on
property,
for
evidently
since
the
tax
is
imposed
on
the
nominal
value
its
quality
as
property
is
disregarded;
it
is
therefore
a
tax
on
the
franchise
which
cannot
be
adjusted.
But,
said
Mr.
Justice
Nelson,
a
tax
on
the
estimated
value
is
a
tax
upon
property,
and
consequently
is
direct
taxation.
As
to
the
tax
in
question
not
being
a
tax
on
property,
the
statute
(45
Vic.,
ec.
22,
Q.)
does
not
impose
it
as
a
tax
on
property,
but
as
a
tax
on
banks,
&c.,
carrying
on
business
in
the
province.
Then
by
section
3
it
regulates
how
each
of
these
ideal
persons
shall
be
charged.
Here
it
is
necessary
to
distinguish
the
cases,
and
first
I
shall
deal
with
banks.
They
are
to
pay
not
on
the
nominal
value
of
their
capital,
but
on
their
paid-up
capital.
Now,
if
it
be
maintained
that
this
tax
is
not
a
tax
on
the
person,
I
do
not
see
how
it
can
be
maintained
that
it
is
not
a
tax
on
property.
There
is
nothing
in
our
constitution
which
declares
anything
as
to
uniformity
of
taxation,
and,
therefore,
it
is
no
legal
objection
to
a
tax
that
it
is
not
levied
upon
any
general
system
of
valuation.
The
power
to
assess
being
admitted,
its
measure
is
a
matter
of
discretion,
subject
to
the
power
of
disallowance
by
the
Dominion
government.
It
is
not
a
legal
question.
The
next
point
is,
that
it
was
not
taxation
of
persons
within
the
jurisdiction
of
the
legislature
of
Quebec.
This
difficulty
does
not
appear
to
me
to
be
formidable.
The
persons
taxed
are
not
the
shareholders
but
the
banks
or
other
corporations.
The
shareholder
is
never
by
law
confounded
with
the
ideal
person,
so
he
can
sue
the
cor-
cit.
There
is
nothing
in
paragraph
2,
section
92,
to
confine
the
tax
to
persons
domiciled
in
the
province.
What
the
statute
says
is,
that
the
taxation
must
be
within
the
province,
or,
in
other
words,
that
the
provincial
government
cannot
execute
its
laws
beyond
its
jurisdiction.
It
scarcely
required
the
words
"‘within
the
province’’
to
establish
this.
Hilhard
(chap.
1,
par.
5,
page
5)
says:—
"‘The
power
of
taxation
*
*
is
necessarily
limited
to
subjects
within
the
jurisdiction
of
the
state.
‘These
subjects
are
persons,
property
and
business.’’
The
statute
does
not
propose
to
tax
persons
outside
the
province,
but
persons
carrying
on
business
within
it
and
benefiting
by
its
organization
and
government.
It
is
an
evident
error
to
say
that
a
person
is
only
liable
to
the
laws
of
his
domicile.
By
his
acts
he
may
make
himself
personally
liable
to
the
laws
of
many
countries
without
ever
leaving
the
place
of
his
birth.
A
Frenchman,
who
has
never
been
out
of
Paris,
might
become
liable
to
a
business
tax
in
Montreal,
and
I
dare
say
that
such
an
impost
could
be
collected,
as
any
other
debt,
in
the
French
courts.
If
an
individual
be
thus
liable
why
should
a
corporation
escape
a
similar
liability
?
The
last
point
is
that
the
property
is
not
within
the
province.
This
difficulty
is
more
substantial,
and
if
the
tax
were
not
also
personal
I
would
be
inclined
to
think
it
valid
as
regards
banks
not
having
their
domicile
in
Quebec,
unless
it
were
shown
that
their
stock
was
there;
but
as
I
have
already
said
the
tax
appears
to
me
to
be
personal
and
to
be
of
the
most
direct
kind,
and
therefore
the
question
does
not
affect
the
cases
before
us.
As
to
those
having
their
principal
place
of
business
in
the
Province
of
Quebec,
the
question
could
not
arise
on
any
supposition.
Again,
as
to
the
argument
that
a
business
tax
is
not
direct,
I
see
nothing
in
that
either
in
principle
or
in
practice.
It
is
notoriously
false
in
principle
that
a
tax
on
a
profession
or
on
a
trade
or
on
wages
necessarily
comes
out
of
the
pocket
of
the
employer
or
the
consumer.
It
stands
on
the
same
footing
as
a
tax
on
profits,
and
profits
are
income,
and
a
tax
on
income
is
direct
taxation.
See
Say,
Cours
d’Economie
Politique,
T.
5,
p.
420,
where
the
result
of
taxing
industries
and
wages
is
clearly
treated.
It
will
be
observed
that
there
are
two
distinct
taxes
on
the
banks,
one
on
the
person
or
on
the
franchise;
the
other
a
purely
business
tax.
The
taxes
on
insurance
companies
are
purely
business
taxes.
Incorporated
companies
for
carrying
on
some
trade,
etc.,
are
charged
with
a
personal
tax
to
be
increased
according
to
the
amount
of
paid
up
capital
over
$250,000
and
an
additional
tax
for
each
place
of
business.
These
cover
all
the
descriptions
of
corporations
that
have
come
before
this
court,
and
I
think
all
the
taxes
they
complain
of
are
within
the
category
of
direct
taxation.
I
have
not
referred
to
the
question
of
excise
although
Mr.
Justice
Taschereau,;
the
ingenious
originator
of
the
numerous
fallacies
I
feel
myself
called
upon
to
combat,
has
drawn
it
into
the
medley.
His
error
here
is
very
easy
of
exposition.
He
has
written
on
a
mutilated
text,
at
least
as
it
is
given
in
Cartwright,
p.
141.
The
full
text
of
what
Wharton
says
is
this:
“Excise,
the
name
given
to
the
duties
or
taxes
laid
on
certain
articles
produced
and
consumed
at
home;
but
exclusive
of
these,
the
duties
on
licenses,
auctioneers
and
post-horses
are
also
placed
under
the
management
of
the
excise,
and
are
consequently
included
in
the
excise
duties.’’—
Wharton’s
Law
Lexicon
vo.
Excise.
To
bring
Mr.
Justice
Taschereau’s
logic
into
line
we
should
have
to
say:
‘‘
Excise
duties
are
direct
taxes;
certain
duties
not
excise
are
collected
by
the
exciseman.
Therefore
they
are
direct
taxes.
Really
the
functions
of
the
gauger,
as
he
was
irreverently
called
formerly,
owing
to
the
ordinary
operations
of
his
calling,
have
been
extended
;
but
that
does
not
alter
the
nature
of
direct
taxation,
nor
the
meaning
of
the
term
in
the
B.N.A.
Act.
The
argument
of
the
learned
Chief
Justice
differs
notably
from
that
of
Mr.
Justice
Taschereau.
He
does
not
go
on
the
strict
definition
of
excise;
but
he
says,
in
legislation
excise
has
been
made
to
include
assessed
taxes.
Therefore
we
must
presume
that
excise,
in
the
contemplation
of
Parliament,
includes
all
these
taxes.
If
it
had
been
our
business
to
interpret
the
word
excise,
it
might
perhaps
have
been
a
consideration
for
us
whether
excise
meant
all
the
taxes
collected
by
the
exciseman.
But
the
Act
does
not
use
the
word
‘‘excise,’’
except
in
a
transitory
clause,
section
102,
for
certain
taxes
then
imposed.
It
is
not
applied
to
the
general
power
of
taxation.
It
is
the
economists
who
say
that
excise
duties
are
not
direct
taxes
because
they
are
similar
to
customs
duties.
To
make
it
a
rule
of
interpretation
that
because
a
particular
word
was
used
in
a
special
sense
in
one
statute,
it
should
have
the
same
interpretation
in
other
statutes,
having
no
relation
to
the
same
subject,
would
be
the
surest
way
of
mistaking
the
intention
of
the
legislature
that
could
be
devised.
There
is
another
view
of
this
case
which,
it
appears
to
me,
merits
closer
attention
than
it
has
received,
and
that
is
whether
the
B.N.A.
Act
has
limited
the
local
powers
of
taxation
to
“direct
taxation
within
the
province
in
order
to
the
raising
of
a
revenue
for
provincial
purposes,”
and
to
"‘shop,
etc.,
and
other
licenses,
in
order
to
the
raising
of
a
revenue
for
provincial,
local,
or
municipal
purposes,’’
and
this
to
the
exclusion
of
every
other
form
of
taxation.
This
enquiry
demands
an
extended
examination
of
the
general
scope
or
scheme
of
the
B.N.A.
Act.
It
has
been
said
the
local
legislatures
are
not
supreme
legislatures.
From
a
purely
abstract
point
of
view,
no
legislature
is
supreme.
In
other
words,
there
are
limits
to
jurisdiction,
which
are
not
identical
with
the
physical
power
to
execute.
Public
law
is
imperfect
in
this,
that
it
has
no
constitutional
power
of
execution;
nevertheless
it
expresses
a
right.
When
De
Hardenberg
exclaimed
at
the
Council
of
Vienna:
i(
Que
fait
ici
le
droit
public?"
Talleyrand
replied:
(i
ll
fait
que
nous
y
êtes."
Again,
Jurisdiction
has
moral
limits,
for
it
has
no
authority
over
conscience.
Akin
to
this
limit
is
the
non-assent
of
the
subject,
and
so
laws
become
obsolete.
It
is
only,
then,
relatively,
that
we
can
speak
of
a
supreme
legislature.
Thus
restricted,
the
Parliament
of
the
United
Kingdom
is
supreme
as
regards
all
the
Queen’s
dominions.
By
force
of
that
supremacy
it
granted
the
constitution
to
Canada
set
forth
in
the
B.N.A.
Act,
1867,
and
by
the
same
power
it
has
amended
that
Act.
By
the
Act
of
1867
and
its
amendments
it
has
divided
the
powers
of
legislation
between
a
federal
legislature
and
local
legislatures,
in
very
different
proportions.
It
is
admitted
that
the
local
legislatures
are
aS
omnipotent
within
the
scope
of
their
legislative
powers
as
the
Dominion
parliament
is
within
its
powers.
It
does
not,
however,
follow
from
this
that
the
federal
organization
has
no
supremacy
over
the
local.
Such
a
pretension
would
be
utterly
untenable,
for
the
federal
power,
alone,
has
the
power
to
nominate
one
of
the
branches
of
the
local
legislature,
it
can
disallow
its
acts,
it
can
turn
local
works
into
federal
works,
and
it
can
create
new
provinces.
The
true
doctrine
seems
to
me
to
be
this,
that
the
federal
power
is
not
generally
supreme
relatively
to
the
local
power.
Its
supremacy
consists
in
its
power
to
influence
indirectly
the
action
of
the
local
power,
or
to
paralyse
it
to.
some
extent,
not
in
the
power
to
destroy
it.
An
indirect
attempt
to
destroy
it
would
therefore
be
unconstitutional
and
unlawful.
It
is
likewise
generally
admitted,
as
has
been
already
said,
that
the
powers
of
the
local
legislatures
are
enumerated
in
the
constititutional
acts,
and
by
parity
of
reasoning
it
cannot
be
denied
that
the
powers
of
the
Dominion
are
also
to
be
found
there.
Giving
full
effect
to
this
principle,
it
must
not,
however,
be
supposed
that
it
implies
that
all
the
powers
given
by
the
constitutional
acts
either
to
the
Domininion
parliament
or
to
the
local
legislatures
are
specially
enumerated.
The
general
power
given
to
the
Queen,
senate
and
house
of
commons
is
"‘to
make
laws
for
the
peace,
order
and
good
government
of
Canada,
in
relation
to
all
matters
not
coming
within
the
classes
of
subjects
by
this
act
assigned
exclusively
to
the
legislatures
of
the
provinces.’‘
But
among
the
matters
coming
within
the
classes
of
subjects
assigned
exclusively
to
the
legsilatures
of
the
provinces
there
are
also
general
powers
of
legislation.
They
make
laws
as
to
"‘all
matters
of
a
merely
local
or
private
nature
in
the
province.”
Does
this
not
embrace
local
taxation
for
local
objects?
And
if
not,
why?
There
can
be
no
question,
I
think,
that
taxation
is
a
necessary
attribute
of
government.
A
government
that
cannot
tax
would
be
a
nullity,
and
the
fact
is
that
it
is
a
power
conferred
in
some
degree
or
other
on
the
most
insignificant
municipality
in
the
country.
They
can
impose
property
and
income
taxes,
insurance
taxes
of
all
sorts
and
a
poll
tax.
The
general
power
to
tax
to
any
extent
has
always
been
recognized
in
the
United
States
as
an
attribute
of
sovereignty,
and
I
don’t
think
there
can
be
any
English
authority
found
to
contradict
this
proposition.
"‘The
power
of
congress
to
exercise
exclusive
jurisdiction
in
all
cases
whatsoever
within
the
district
of
Columbia
includes
the
power
of
taxing
it,’’
Loughborough
&
Blake
(5
Wheaton,
317).
‘‘The
power
of
taxing
is
essential
to
the
very
existence
of
government.’’
4
Wheaton,
428.
This
taxing
power
is
an
essential
attribute
of
sovereignty,
and
can
only
be
abridged
by
positive
legislative
enactment,
clearly
expressed.
The
power
is
not
affected
by
a
charter
which
is
silent
on
the
subject.’’
Hilliard,
Law
of
Taxation,
ch.
1,
par.
85,
p.
40.
In
answer
to
a
question
I
put
at
the
argument
upon
this
point,
Mr.
Maclaren
said
that
subsections
2
and
9,
sect.
92,
were
impliedly
a
dealing
with
the
whole
question
of
the
taxing
power,
for
if
the
local
legislatures
had
full
powers
to
tax,
these
two
subsections
would
have
been
unnecessary,
and,
therefore,
the
power
to
tax
indirectly
is
impliedly
taken
away.
This
is
a
very
ingenious
argument
and
the
best,
I
fancy,
which
can
be
put
forward,
but
I
don’t
think
it
satisfactory
In
the
first
place
the
rule
of
interpretation
inclusio
unius,
exclusio
alterius
is
one
of
the
feeblest
of
the
rules
of
interpretation,
if
it
can
be
called
a
rule
at
all.
The
real
rule
is
thus
expressed
by
Pothier,
No.
100:
‘‘Lorsque
dans
un
contrat
on
a
exprimé
un
cas,
pour
le
doute
qu’il
aurait
pu
y
avoir,
si
l’engagement
qui
résulte
du
contrat
s’étendait
à
ce
cas,
on
n’est
pas
censé
par
là
avoir
voulu
restreindre
l’étendue
que
cet
engagement
a
de
droit,
à
tous
ceux
qui
ne
sont
pas
exprimés.”
It
is
a
rule
of
the
Roman
law:
"‘Quæ
dubitationis
tollendæ
causa,
contractibus
inferuntur,
jus
commune
non
ledunt.’’
L.
81,
Dig.
de
regulis
Jur.
;
L.
55,
Mand.
I
find
it
equally
imperatively
expressed
in
the
English
law.
Coke
says:
"‘It
is
a
maxim
of
the
common
law
that
a
statute
made
in
the
affirmative,
without
any
negative
expressed
or
implied,
doth
not
take
away
the
common
law.”
And
Lord
Hatherley,
summing
up
the
opinion
of
Mr.
Justice
Blackburn
in
Ashbury
R.
Car.
and
Iron
Co.
v.
Riche,
says:
‘‘Then
he
(Mr.
Justice
Blackburn)
cites
from
old
authorities
to
show
‘that
when
once
you
have
given
being
to
such
a
body
as
this,
you
must
be
taken
to
have
given
to
it
all
the
consequences
of
its
being
called
into
existence,
unless
by
express
negative
words,
you
have
restricted
the
operation
of
the
acts
of
the
body
you
have
so
created.’
L.R.,
7
H.L.
685.
There
are
numerous
cases
supporting
this
doctrine
in
different
ways.
For
instance,
this
distinction
has
been
made
between
using
words
that
are
unnecessary
and
using
words
that
are
unmeaning;
the
former
is
readily
supposed,
the
latter
is
never
presumed.—
Auchterarder
v.
Lord
Kinnoull,
6
C.
&
F.
686.
Words
that
are,
strictly
speaking,
unnecessary
may
be
used
ex
majore
cautela.
Duke
of
Newcastle
&
Morris,
L.R.,
14
H.L.
662;
Fryer
&
Morland,
L.R.,
3
Ch.
Div.
685.
That
is
precisely
what,
I
think,
was
done
in
this
Act.
The
right
to
tax
the
person
might
have
been
questioned
with
much
greater
force
than
the
right
to
tax
indirectly,
if
nothing
had
been
said.
Besides
this,
there
is
a
limitation
in
both
subsections.
Subsection
2
allows
exclusively
direct
taxation
in
order
to
the
raising
a
revenue
for
provincial
purposes,
and
section
9
authorizes
legislation
as
to
certain
licenses
in
order
to
the
raising
a
revenue
for
provincial,
local
or
municipal
purposes.
In
the
third
place
it
is,
at
all
events,
not
an
express
exclusion
of
the
general
power
to
tax,
which
seems
to
be
an
inherent
right
of
government;
and
in
the
fourth
place,
subsection
16
covers
any
omission
of
the
sort.
To
this
I
may
add
that
if
the
arguments
referred
to
were
good
in
this
case,
the
local
legislatures
could
not
legislate
as
to
shops,
saloons
or
taverns
at
all,
except
in
regard
to
licenses,
in
order
to
raise
revenue.
This
has
never
been
pretended,
and
Hodge
&
The
Queen
is
an
authority
to
show
that
such
a
pretention
would
not
be
maintained,
for
what
the
legislature
of
Ontario
did
was
to
create
license
commissioners
with
power
to
pass
resolutions
to
close
taverns
and
billiard
rooms
at
certain
hours.
In
Blouin
v.
The
Corporation
of
Quebec,
7
Q.L.R.
18,
Chief
Justice
Meredith
gave
a
similar
decision,
as
also
in
the
ease
of
Poulin
v.
The
Corporation
of
Quebec,
7
Q.L.R.
337.
The
latter
case
was
confirmed
on
appeal
to
this
court,
and
also
by
the
Supreme
court.
One
other
argument
has
been
put
forward,
with
some
plausibility,
to
show
that
parliament
never
intended
to
give
the
local
legislatures
the
right
to
tax
indirectly.
It
was
said
that
certain
speakers
in
Canada,
who
spoke
on
the
resolutions,
had
expressed
the
idea
that
the
local
governments
were
to
live
on
direct
taxation
and
on
the
federal
subsidy.
It
is
very
true
that
in
France
commentators
allow
themselves
great
latitude
in
referring
to
the
history
of
the
code;
but
the
discussions
in
the
council
of
state
and
in
the
tribune
were
of
a
very
different
kind
from
the
discussions
of
a
popular
body
like
the
house’
of
assembly
;
and
I
am
not
aware
that
any
weight
is
attached
in
France
to
the
opinions
of
individual
members
of
the
assembly.
Nothing,
however,
is
better
established
in
England
than
this,
that
the
debates
in
parliament
are
not
authority
as
to
the
interpretation
of
statutes.
The
cases
are
systematically
arranged
in
Mr.
Hardcastle’s
very
carefully
prepared
treatise
on
the
construction
and
effect
of
Statutory
Law,
p.
55.
If
there
be
any
difference
between
the
French
and
English
law
on
this
point,
which
I
am
inclined
to
doubt,
we
must,
of
course,
reject
the
French
rule.
In
referring
to
the
acts
of
the
legislature
we
express
almost
an
excessive
deference
for
them;
but
we
compensate
ourselves
for
this
liployalty
to
the
words
of
the
statute,
by
disregarding
totally
the
sayings
of
the
individual
legislator.
This
line
of
argument
necessarily
leads
us
to
examine
the
rules
as
to
the
interpretation
of
statutes,
and
to
a
short
digression
in
order
to
ascertain
the
fundamental
principles
upon
which
the
right
to
tax
rests,
if
it
exists
at
all.
The
difficulty
of
these
rules
appears
to
me
to
be
a
good
deal
overrated.
Their
simplicity
is
so
great
the
bookmakers
can
hardly
find
materials
to
make
books
about
them.
A
statute,
according
to
our
ordinary
use
of
the
word,
is
an
act
of
the
legislature.
Its
dispositions
are
either
clearly
enounced
or
their
terms
are
ambiguous.
In
the
former
case
they
are
to
be
applied
according
to
their
terms,
the
language
being
taken
to
have
the
meaning
popularly
attached
to
it.
In
delivering
the
judgment
of
the
Privy
Council
in
McConnel
&
Murphy,
L.R.,
5
P.C.,
p.
218,
Sir
Montague
Smith
said:
‘‘In
mercantile
contracts,
and
indeed
in
all
contracts
where
the
meaning
of
language
is
to
be
determined
by
the
court,
the
governing
principle
must
be
to
ascertain
the
intention
of
the
parties,
through
the
words
they
have
used.
This
principle
is
one
of
universal
application.’’
If
the
terms
are
ambiguous
for
any
cause,
whether
it
be
from
a
vice
of
construction
of
a
particular
section,
or
from
contradiction
in
the
provisions
of
the
statute,
or
from
incompatibility
with
the
general
meaning
of
the
act,
or
because
literal
application
would
lead
to
an
absurd
conclusion
as
would
frustrate
the
purposes
of
the
act,
then
interpretation
begins,
and
it
is
sought
thereby
to
arrive
at
the
true
intention
of
the
legislature.
It
is
not
a
question
of
adding
to
or
taking
away
from
the
act;
but
deciding
what
the
act
really
means.
There
are
a
few
legislative
rules
as
to
the
mode
of
dealing
with
such
difficulties
and
also
certain
rules,
derived
from
experience
and
reasoning,
have
been
laid
down
as
general
guides
in
such
matters;
but
the
latter
leave
much
to
the
discretion
of
the
judges,
because
their
delimitation
is
scarcely
more
extensive
than
each
particular
case.
I
think,
however,
it
may
be
said,
generally
speaking,
that
in
the
interpretation
of
a
statute
indice
similar
to
those
which
guide
us
as
to
the
intention
of
parties,
in
the
absence
of
express
declarations
as
to
their
intention,
are
applicable.
Lord
Blackburn
has
explained,
with
his
usual
breadth
and
precision,
how
the
courts
of
law
act
in
construing
instruments
in
writing.
He
says:
"‘a
statute
is
an
instrument
in
writing.
In
all
cases
the
object
is
to
see
what
is
the
intention
expressed
by
the
words
used.
But,
from
the
imperfection
of
language,
it
is
impossible
to
know
what
that
intention
is
without
inquiring
further;
and
seeing
what
the
circumstances
were
with
reference
to
which
the
words
were
used,
and
what
was
the
object
appearing
from
those
circumstances
which
the
person
using
them
had
in
view.”
River
Wear
v.
Adamson,
L.R..
2
App.
Cas.
763.
Another
very
great
authority,
Mr.
Justice
Hannen,
has
said:
"‘I
agree
with
Mr.
Thesiger
that
an
appeal
can
only
be
given
by
the
clearly
expressed
intention
of
the
legislature.
This
must
be
ascertained
by
an
examination
of
the
enactment
which
is
the
subject
of
enquiry.
It
is
not
necessary
that
there
should
be
any
particular
form
of
words,
but
it
is
essential
that
an
intention
to
give
an
appeal
should
clearly
appear.’’
*
*
The
authorities
that
have
been
cited
have
not
much
bearing
upon
this
question,
because
in
all
cases
the
intention
of
the
legislature
must
depend
to
a
great
extent
upon
the
particular
object
of
the
statute
that
has
to
be
construed.
I
have
come
to
the
conclusion
that
the
legislature
intended
to
give
an
appeal
in
a
case
like
the
present.’’
L.R.,
Q.B.
vol.
5,
p.
93.
The
Queen
v.
Justices
of
Surrey.
•
Taking
these
authorities
as
expressing
the
general
rules
for
the
interpretation
of
statutes,
and
which
seem
to
be
identical
with
those
which
obtain
in
France
(see
H.M.
Procureur
&
Bruneau,
L.R.,
1
P.C.
191),
it
can
scarcely
be
questioned
that
the
preamble
of
an
act
is
greatly
to
be
considered
in
determining
the
intention
of
the
legislature
where
there
is
any
doubt
as
to
the
meaning
of
its
terms.
See
also
Menoch.
de
presump.
L.
vi.,
Præs.
2,
Nos.
2,
3,
4;
and
Comyns
in
his
Dig.
Vbo.
Parliament,
says
:—"‘The
preamble
is
a
good
means
for
collecting
the
intent.’’
Now,
if
we
come
to
the
preamble
of
the
B.N.A.
Act,
1867,
we
find
the
objects
of
the
statute
generally
declared.
The
third
paragraph
is
in
these
words:—"‘And
whereas
on
the
establishment
of
the
Union
by
authority
of
Parliament,
it
is
expedient
not
only
that
the
constitution
of
the
legislative
authority
in
the
Dominion
be
provided
for,
but
also
that
the
nature
of
the
executive
government
therein
be
declared.’’
The
Act
then
goes
on
to
prescribe
of
what
the
executive
of
the
central
government
shall
consist,
after
that
of
what
the
legislature,
called
parliament,
shall
consist.
It
then
follows
the
same
form
of
legislation
for
the
local
constitutions.
It
would
seem
then
beyond
question
that
this
Act
attributes
plenary
governmental
powers
with
regard
to
certain
matters
to
both
the
federal
and
local
bodies,
and
so
far
as
I
know
this
has
never
been
doubted.
We
have
therefore
one
point
settled.
The
local
organizations
are
governments.
They
enjoy
regalian
powers,
and
all
the
incidents
of
such
powers
;
and
these
powers
have
not
been
limited
by
the
charter,
which,
although
it
has
specially
passed
on
the
taxing
power,
has
been
silent
as
to
the
powers
of
indirect
taxation.
To
the
last
part
of
this
argument,
that
is
to
say,
that
the
right
to
tax
generally
has
not
been
expressly
taken
away,
it
has
been
said
that
by
subsection
3,
section
91,
"The
exclusive
authority
of
the
parliament
of
Canada
extends
to
the
raising
of
money
by
any
mode
or
system
of
taxation,”
and
it
is
further
provided
that
"any
matter
coming
within
any
of
the
classes
of
subjects
enumerated
in
this
section
(1.e.,
section
91,
of
which
taxation
is
one)
shall
not
be
deemed
to
come
within
the
class
of
matters
of
a
local
or
private
nature
comprised
in
the
enumeration
of
classes
of
subjects
by
this
Act
assigned
exclusively
to
the
legislatures
of
the
provinces,’’
and
that
this
is
an
express
and
not
an
implied
taking
away
of
the
general
right
to
tax.
This
is
a
formidable
position.
To
the
federal
parliament
exclusive
authority
is
attributed,
and
the
exclusiveness
so
given
overrides
even
the
declaration
attributing
exclusive
power
to
the
local
legislatures.
That
is,
the
exclusive
power
of
the
former
is
absolute,
that
of
the
latter
is
subject
to
the
condition
that
it
shall
not
clash
with
the
former.
It
is
not
easy
to
conceive
words
more
clear
than
those
of
the
B.N.A.
Act
to
express
this
idea,
nevertheless
it
has
been
universally
admitted
that
this
interpretation
cannot
be
put
upon
the
statute.
In
the
case
of
L
9
Union
St.
Jacques
v.
Belisle,
L.R.,
6
P.C.
31,
decided
in
1874,
Lord
Selborne
explained
the
necessity
of
reconciling
the
two
enumerations.
In
1877,
in
the
case
of
Angers
v.
The
Queen
Insurance
Co.,
3
H.
of
L.
and
P.C.
1090;
1
Leg.
News,
410,
I
drew
attention
to
this
necessity,
in
these
words
:—
"
It
would
be
a
defensible
position
to
say
that
the
proviso
of
section
91
so
controlled
subsections
2
and
9
of
section
92
as
to
render
them
inapplicable,
although
I
do
not
think
this
was
the
intention
of
the
Imperial
parliament.
But
the
majority
of
the
court
does
not
adopt
that
view.
*
*
The
whole
that
the
judgment
about
to
be
rendered
affirms
is,
that
the
particular
mode
of
levying
a
license
adopted
in
the
statute
before
us
is
beyond
the
powers
of
the
local
legislature’’
(1
Cartwright,
181),
and
as
I
have
already
shown,
it
is
that
alone
the
Privy
Council
held
in
confirming
the
judgment
of
this
court.
(/b.)
They
therefore
impliedly
rejected
the
short
way
out
of
the
difficulty
now
suggested,
as
inadmissible.
Later,
in
1880,
in
the
case
of
Dobie
v.
The
Temporalities
Board,
7
H.L.
and
P.C.,
186;
5
Leg.
News,
58,
I
argued
that
section
92
must
be
read
with
section
91,
so
as
to
modify
the
generality
of
subsection
"13
Property
and
civil
rights
in
the
province.”
The
judgment
of
this
court
was
reversed
in
the
sense
of
the
dissent,
and
no
disapprobation
of
this
doctrine
was
expressed.
The
following
year
the
Privy
Council
in
the
case
of
the
Queen
Ins.
Co.
v.
Parsons,
7
H.L.
and
P.C.
96;
5
Leg.
News,
25,
by
a
similar
process
of
reasoning,
restrained
the
generality
of
section
9,
subsection
2,
"‘The
Regulation
of
trade
and
commerce,’’
in
order
to
give
scope
to
the
local
power
over
property
and
civil
rights,
and
L^Union
St.
Jacques
&
Belisle,
and
Cushing
&
Dupuy,
5
H.L.
&
P.C.
136;
26
L.C.J.
170;
5
Leg.
News,
58,
were
referred
to
as
being
in
the
same
sense.
Furthermore,
the
Privy
Council
enunciated
the
doctrine
of
progressive
interpretation,
to
which
I
have
already
alluded
in
this
opinion.
To
this
it
is
answered—
true
so
far,
a
general
power
will
be
restrained
to
give
scope
to
a
special
power.
This
distinction
does
not
meet
the
cases.
In
the
case
last
mentioned,
two
powers
general
and
exclusive,
one
attributed
by
section
91,
the
other
by
section
92,
somewhat
in
conflict,
were
compelled
to
live
together.
In
Cushing
v.
Dupuy
it
was
a
conflict
of
powers
equally
general.
Palpably
the
double
enumeration
enacted
for
"6
greater
certainty”
is
a
faulty
construction,
and
it
becomes
necessary
for
us,
to
carry
out
the
intention
of
the
legislature,
to
find
a
modus
vivendi.
We
are
not
to
construe
the
statute
so
as
to
make
our
institutions
impossible;
we
are
not
to
lay
down
a
rule
which
"‘followed
up
to
its
consequences
would
go
far
to
destroy
that
power
(the
provincial)
in
all
cases,”
as
Lord
Selborne
has
said.
(1
Cartwright
71.)
This
must
be
the
language
of
every
jurisconsult
;
and
it
is
thus
the
great
judges
of
the
United
States
have
dealt
with
their
constitution.
As
an
instance,
in
the
case
already
cited
of
Hylton
v.
The
United
States,
Chase,
J.,
said:
"‘The
rule
of
apportionment
(an
express
rule
of
the
constitution)
is
only
to
be
adopted
in
such
cases
where
it
can
reasonably
apply.”
I
shall
make
four
quotations
from
the
case
of
the
Citizens
Insurance
Company
&
Parsons
to
show
that
the
Privy
Council
has
used
the
same
freedom
of
interpretation,
and
has
held
that,
in
spite
of
the
absolute
form
of
sections
91
and
92,
the
courts
will
read
them
together,
and
modify
one
or
the
other
or
both,
to
meet
the
general
requirements
of
the
act,
and
to
attain
the
ends
parliament
must
be
supposed
to
have
had
in
view
:—
"But
it
must
have
been
foreseen
that
this
sharp
and
definite
distinction
had
not
been
and
could
not
be
attained,
and
that
some
of
the
classes
of
subjects
assigned
to
the
provincial
legislatures
unavoidably
ran
into
and
were
embraced
by
some
of
the
enumerated
classes
of
subjects
in
section
91.”
"Notwithstanding
this
endeavour
to
give
pre-eminence
to
the
Dominion
parliament
in
cases
of
a
conflict
of
powers,
it
is
obvious
that
in
some
cases
where
this
apparent
conflict
exists,
the
legislature
could
not
have
intended
that
the
powers
exclusively
assigned
to
the
provincial
legislature
should
be
absorbed
in
those
given
to
the
Dominion
government.”
"It
could
not
have
been
the
intention
that
a
conflict
should
exist,
and,
in
order
to
prevent
such
a
result,
the
language
of
the
sections
must
be
read
together,
and
that’
of
one
interpreted,
and
where
necessary
modified
by
that
of
the
other.’’
"It
becomes
obvious,
as
soon
as
an
attempt
is
made
to
construe
the
general
terms
in
which
the
classes
of
subjects
in
sections
91
and
92
are
described,
that
both
sections
and
the
other
parts
of
the
act
must
be
looked
at
to
ascertain
whether
language
of
a
general
nature
must
not,
by
necessary
implication
or
reasonable
intendment,
be
modified
and
limited.’’
(1
Cartwright,
271-2-3-4.
)
But
it
may
be
still
further
urged
that
the
majority
of
the
court
is
endeavouring
to
restrain
the
particular
power
of
subsection
3,
section
91,
by
the
general
subsection
16
of
section
92.
To
this
I
answer,
that
it
is
not
the
generality
of
the
terms
in
which
a
power
is
conveyed
that
decides
as
to
its
nature,
so
in
L
9
Union
St.
Jacques
&
Belisle
it
was
the
general
subsection
16
of
section
92
that
qualified
and
restrained
subsection
‘‘21.
Bankruptcy
and
insolvency,”
precisely
as
the
court
does
in
this
instance.
‘‘Clearly
this
matter
is
private;
clearly
it
is
local,
etc.,”
said
Lord
Selborne;
and
therefore
it
is
a
power
given
to
the
local
legislatures.
I
need
hardly
add
that
the
court
does
not
contend
that
subsection
16
could
prevail
if
it
were
incompatible
with
subsection
3.
But
this
it
cannot
be,
unless
we
hold
that
there
cannot
be
double
taxation,
which
is
untenable,
(Bemis
et
al.
&
Board
of
Aldermen
of
Boston,
13
Allen,
368).
Besides,
the
power
of
double
taxation
is
expressly
recognized
by
the
Act.
On
the
main
question,
as
to
whether
there
is
any
other
power
to
tax
except
by
way
of
license
than
that
set
forth
in
subsection
2,
the
case
of
Dow
&
Black,
L.R.,
6
P.C.
272,
seems
to
furnish
direct
authority.
Sir
James
Colvile,
in
pronouncing
the
judgment
of
the
Privy
Council
said
:—
1
"
Their
lordships
are
further
of
opinion
with
Mr.
Justice
Fisher,
the
dissentient
judge
in
the
Supreme
Court,
that
the
Act
in
question,
even
if
it
did
not
fall
within
the
2nd
article
(of
sect.
92),
would
clearly
be
a
law
relating
to
a
matter
of
a
merely
local
or
private
nature
within
the
reading
of
the
9th
article
of
section
92,
of
the
imperial
statue.’’
It
is
evident
the
learned
judge
meant
the
16th
article
of
section
92,
for
he
had
just
declared
that
article
9
had
""
obviously
no
bearing
on
the
present
question.’’
Again,
the
words
"‘of
a
merely
local
or
private
nature,’’
are
not
used
in
article
9,
they
are
used
in
article
16
and
in
no
other
part
of
section
92.
And
lastly,
if
this
is
not
enough,
to
agree
with
Mr.
Justice
Fisher,
article
16
must
have
been
intended,
for
that
learned
judge
said:
"‘It
also
appears
to
me
that
the
act
33
Vic.,
ce.
47,
comes
within
the
category
of
powers
provided
for
in
the
1th
clause
of
the
92nd
section
of
the
B.N.A.
Act,
1867,
being
purely
a
matter
of
a
local
nature.’’
It
seems
to
me
then,
that
it
is
safe
to
say
that
Dow
&
Black
lays
down
the
principle
as
formally
as
it
can
be
laid
down
(barring
only
the
slip
as
to
the
number
of
the
subsection),
that
the
subsections
2
and
9
do
not
exclude
from
the
powers
of
the
local
legislatures
the
right
to
propose
other
forms
of
taxation.
The
learned
Chief
Justice
has
referred
to
the
case
of
Dow
&
Black
as
though
it
were
an
obiter
dictum.
It
is
true
it
was
not
necessary
for
their
lordships
to
speak
of
this,
but
it
was
scarcely
obiter,
for
it
was
before
them,
and
it
had
formed
a
ground
of
dissent
in
the
court
below.
While
the
argument
in
this
case
was
going
on,
we
learned
by
telegraph
that
the
Privy
Council
had
confirmed
the
decision
of
the
Supreme
court
in
The
Attorney-General
&
Reed.
I
have
not
been
enabled
to
see
what
their
lordships
said
in
that
case,
except
through
the
medium
of
newspaper
reports,
from
which
I
am
not
disposed
to
take
the
decision,
inasmuch
as
it
is
usual
for
the
Privy
Council
to
submit
a
report
in
writing,
which
lays
down
precise
propositions.
And,
in
any
case,
the
report,
such
as
we
have
it,
does
not
affect
my
opinion
in
this
case.
If
the
10
cents
tax
was
a
tax
at
all,
it
was
not
direct
taxation,
within
the
meaning
of
the
B.N.A.
Act.
In
Mr.
J.
S.
Mill’s
opinion,
its
character
would
only
be
determined
with
the
end
of
the
litigation,
and
when
it
was
decided
who
should
pay
the
costs
of
filing
the
exhibit.
I
am
not,
however,
of
the
opinion
that
the
jus
edicendi
which
the
Chief
Justice
of
the
Supreme
Court
seems
to
think
is
possessed
by
courts
can
possibly
go
to
the
extent
of
compelling
us
to
accept
as
an
admitted
truth
the
so-called
science
of
political
economy
or
the
theories
of
Mr.
Mill,
and
lest
my
indocility
to
accept
such
doctrines
may
appear
presumptuous,
I
shall
quote
two
paragraphs
from
Mr.
Jevons,
"Theory
of
Political
Economy,”
one
from
the
preface,
the
other
the
concluding
sentence
of
the
work,
dealing
with
Mr.
Mill’s
claims
to
be
considered
as
the
high
priest
and
prophet
of
political
economy,
and
with
the
so-called
science
as
known:
"‘The
contents
of
the
following
pages
can
hardly
meet
with
ready
acceptance
among
those
who
regard
the
science
of
political
economy
as
having
already
acquired
a
nearly
perfect
form.
I
believe
it
is
generally
supposed
that
Adam
Smith
laid
the
foundations
of
this
science;
that
Malthus,
Anderson
and
Senior
added
important
doctrines;
that
Ricardo
systematised
the
whole;
and
finally,
that
Mr.
J.
S.
Mill
filled
in
the
details
and
completely
expounded
this
branch
of
knowledge.
Mr.
Mill
appears
to
have
had
a
similar
notion;
for
he
distinctly
asserts
that
there
was
nothing
in
the
laws
of
value
which
remained
for
himself
or
any
future
writer
to
clear
up.
Doubtless
it
is
difficult
to
help
feeling
that
opinions
adopted
and
confirmed
by
such
eminent
men
have
much
weight
of
probability
in
their
favour.
Yet,
in
the
other
sciences
this
weight
of
authority
has
not
been
allowed
to
restrict
the
free
examination
of
new
opinions
and
theories;
and
it
has
often
been
ultimately
proved
that
authority
was
on
the
wrong
side.’’
(Theory
of
Political
Economy,
W.
S.
Jevons,
page
v.)
"'the
NOXIOUS
INFLUENCE
OF
AUTHORITY.
“I
have
but
a
few
words
more
to
add.
I
have
ventured
in
the
preceding
pages
to
call
in
question
not
a
few
of
the
favorite
doctrines
of
economists.
To
me
it
is
far
more
pleasant
to
agree
than
to
differ;
but
it
is
impossible
that
he
who
has
any
regard
for
truth
can
long
avoid
protesting
against
doctrines
which
seem
to
him
erroneous.
There
is
ever
a
tendency
of
a
most
hurtful
kind
to
allow
opinions
to
crystallise
into
creeds.
Especially
does
this
tendency
manifest
itself
when
some
eminent
author,
with
the
power
of
clear
and
compre
hensive
exposition,
becomes
recognized
as
an
authority
on
the
subject.
His
works
may
possibly
be
far
the
best
which
are
extant;
they
may
combine
more
truth
with
less
error
than
we
can
elsewhere
find.
But
any
man
may
err,
and
the
best
works
should
ever
be
open
to
criticism.
If,
instead
of
welcoming
inquiry
and
criticism,
the
admirers
of
a
great
author
accept
his
writings
as
authoritative,
both
in
their
excellences
and
defects,
the
most
serious
injury
is
done
to
truth.
In
matters
of
philosophy
and
science
authority
has
ever
been
the
great
opponent
of
truth.
A
despotic
claim
is
the
triumph
of
error;
in
the
republic
of
the
sciences
sedition
and
even
anarchy
are
commendable.’’
I
dem,
page
265.
In
The
Attorney-General
&
Reed
I
do
not
learn
from
the
report
I
have
seen
that
the
decision
of
the
Privy
Council
in
Dow
&
Black
has
been
distinctly
over-ruled.
Until
this
is
done
in
precise
terms
I
shall
continue
to
hold
that
the
local
legislatures
may
impose
taxation
by
other
modes
than
those
set
forth
in
subsections
2
and
9
sec.
92.
In
arriving
at
this
conclusion
I
am
satisfied
to
think
that
the
most
submissive
case-lawyer
could
not
confine
himself
more
completely
within
his
self-constituted
prison
than
the
majority
of
this
court
has
confined
itself
within
the
bounds
of
precedent.
Of
course,
I
don’t
count
the
case
of
Severn
&
The
Queen.
If
we
were
to
be
bound
by
it,
nothing
could
be
said
on
the
right
to
tax
indirectly;
but
it
is
only
the
decision
of
an
intermediate
Court
of
Appeal,
and
in
a
matter
of
this
kind
it
cannot
be
considered
conclusive.
It
is
also
pleasing
to
know
that
in
a.
great
part
of
the
judgment
there
is
unanimity
in
this
court.
We
all
reject
the
pretended
scientific
meaning
of
direct
taxation,
and
this,
I
hope,
will
check
the
objectionable
practice
of
reading
books
that
are
not
authority
in
court.
Where
we
differ
is
as
to
the
nature
of
the
tax
and
as
to
the
power
of
the
local
legislature
to
collect
indirect
taxes.
I
have
not
alluded
to
the
argument
of
the
possible
abuse
of
the
taxing
power.
We
constantly
hear
it
said,
if
the
local
legislatures
have
all
powers
of
taxation,
they
may
destroy
trade
and
commerce,
and
so
forth.
There
is
some
truth
in
this.
The
folly
of
killing
the
hen
that
lays
the
golden
eggs
is
not
a
new
idea
to
the
world.
However,
the
presumption
is
that
the
institutions
of
government
tend
to
enrich
and
not
to
empoverish
the
subject.
Very
extreme
cases
may
come
up,
which,
under
the
principles
I
have
endeavored
to
explain,
and
which
I
understand
to
be
those
sanctioned
by
the
Privy
Council,
will
give
rise
to
distinctions
with
which
the
courts
will
have
to
deal.
But
in
any
ease,
the
simple
abuse
of
the
power
to
tax
can
always
be
checked
by
the
power
to
disallow
possessed
by
the
federal
authority.
We
are
to
maintain
the
taxes
in
all
the
cases,
and
consequently
the
judgments
in
the
five
bank
cases
will
be
reversed,
and
in
the
four
other
cases
the
judgments
will
be
confirmed.
Email this Content