ANGERS,
J.
:—This
is
an
action
for
the
recovery
of
a.
consumption
or
sales
tax
in
the
sum
of
$1,453.50,
together
with
penalty
interest
thereon
at
the
rate
of
two-thirds
of
one
per
cent
per
month
from
August
1,
1930,
to
October
31,
1933,
namely,
the
sum
of
$377.91,
and
further
penalty
interest
at
the
same
rate
from
October
31,
1933,
to
the
date
of
payment.
The
action
is
brought
under
the
provisions
of
the
Special
War
Revenue
Act,
R.S.C.,
1927,
ch.
179,
and
amendments
thereto.
The
defendant
is
a
retired
merchant
and
lives
in
the
city
of
Vancouver,
in
the
province
of
British
Columbia.
In
the
years
1929
and
1930
the
defendant
built
for
his
personal
use
a
yacht
which
was
called
the
Cora
Marie.
The
yacht
was
launched
in
February,
1930,
and
was
registered
with
the
registrar
of
shipping
at
Vancouver,
B.C.,
on
or
about
April
17,
1930.
Admissions
were
made
at
the
trial
which
may
be
summarized
as
follows
:
the
defendant
built
the
Cora
Marie
which
was
completed
in
all
respeets
on
June
15,
1930;
the
cost
of
the
vessel,
exclusive
of
fittings
and
furnishings,
was
$145,350
;
the
defendant
sold
the
vessel
in
the
fall
of
1932;
the
defendant
was
assessed
for
sales
tax
in
respect
of
this
vessel
on
the
20th
of
August,
1931
;
a
confirmatory
notice
of
assessment
was
given
to
him
on
the
26th
of
August,
1933;
demand
of
payment
on
behalf
of
the
Crown
was
duly
made
on
the
defendant
and
payment
was
refused
;
the
defendant
was
not
and
is
not
in
the
business
of
building
boats
or
ships
and
the
construction
of
the
vessel
Cora
Marie
was
an
isolated
transaction
;
the
ship
was
not
built
for
purposes
of
sale
but
for
the
personal
pleasure
of
the
defendant
;
the
defendant
hired
the
workmen
to
do
the
work,
paid
their
wages,
purchased
and
paid
for
the
materials
and
rented
the
place
where
the
building
operations
were
carried
on;
the
defendant
sold
the
ship
in
the
fall
of
1932
for
$80,000
cash
and
a
boat
which
he
subsequently
sold
for
$6,000.
A
document
in
the
handwriting
of
defendant’s
solicitor
containing
these
admissions
was
by
consent
filed
as
exhibit
1.
No
evidence
was
adduced
by
either
party
at
the
trial.
The
only
question
to
determine
is
whether
or
not
the
defendant,
in
building
a
yacht
for
his
personal
use
in
the
circumstances
hereinabove
set
out,
is
to
be
considered
a
manufacturer
or
producer
within
the
meaning
of
the
Special
War
Revenue
Act.
Under
sec.
86
of
the
Act,
as
amended
by
18-19
Geo.
V,
ch.
50,
sec.
3;
19-20
Geo.
V,
ch.
57,
sec.
5,
and
20-21
Geo.
V,
ch.
43.
sec.
2,
there
is
imposed
a
consumption
or
sales
tax
of
one
per
cent
on
the
sale
price
of
all
goods
(inter
alia)
"‘produced
or
manufactured
in
Canada,
payable
by
the
producer
or
manufacturer
at
the
time
of
the
sale
thereof
by
him.”
"Sale
price’’
is
defined
in
subsees.
(a)
and
(b)
of
see.
85.
See.
87,
the
first
paragraph
whereof
was
introduced
into
the
statute
by
15-14
Geo.
V,
ch.
70,
see.
6,
deals
with
cases
where
there
is
no
fixed
price
of
sale
and
where
it
is
difficult
to
determine
the
value
of
the
goods
for
the
consumption
or
sales
tax;
the
material
portion
of
the
section,
as.
far
as
the
present
case
is
concerned,
is
as
follows:
"Whenever
goods
are
manufactured
or
produced
in
Canada
under
such
circumstances
or
conditions
as
render
it
difficult
to
determine
the
value
thereof
for
the
consumption
or
sales
tax
because
(d)
such
goods
are
for
use
by
the
manufacturer
or
producer
and
not
for
ale;
"‘the
Minister
may
determine
the
value
for
the
tax
under
this
Act
and
all
such
transactions
shall
for
the
purposes
of
this
Act
be
regarded
as
sales.’’
Subsec.
2
of
sec.
87
was
inserted
in
the
Act
by
21-22
Geo.
V,
ch.
54,
sec.
12,
which
only
came
into
force
on
the
3rd*
of
August,
1931,
subsequent
to
the
date
on
which
the
yacht
Cora
Marie
was
completed;
the
said
subsection
is
therefore
inapplicable
to
the
present
case.
The
Act
contains
no
definition
of
the
words
"‘manufacturer''
and
‘‘producer,’’
with
the
exception,
however,
of
the
statement
in
subsec.
(f)
of
sec.
85
which
can
hardly
be
called
a
definition
and
which
moreover
has
no
relevancy
to
the
issue
herein.
It
was
submitted
by
counsel
for
defendant
that
his
client
‘was
not
a
manufacturer
or
a
producer
within
the
meaning
of
the
Act,
for
two
reasons
:
firstly,
because
the
word
manufacturer
or
producer
is
not
an
adequate
term
to
express
the
builder
of
a
Ship;
secondly,
because
the
word
manufacturer
or
producer
as
used
in
the
Act
connotes
manufacturing
or
producing
in
the
way
of
a
business
and
does
not
refer
to
an
isolated
transaction.
‘
‘
Producer
‘
is
defined:
In
the
Oxford
Dictionary
1.
One
who
or
that
which
produces.
2.
One
who
produces
(grows,
digs
or
manufactures)
an
article
of
consumption.
In
the
Imperial
Dictionary
One
who
or
that
which
produces
or
generates.
"‘Manufacturer,''
on
the
other
hand,
is
defined
as
follows:
In
the
Oxford
Dictionary
One
who
employs
workmen
for
manufacturing;
the
owner
of
a
manufactory.
In
the
Imperial
Dictionary
One
who
manufactures;
one
who
employs
workmen
for
manufacturing;
the
owner
of
the
manufactory.
As
the
verb
"‘manufacture''
is
used
in
some
of
the
definitions
of
the
word
‘‘manufacturer,’’
it
is
perhaps
not
inexpedient
to
quote
the
definitions
of
the
verb,
which
are
thus
worded
:
In
the
Oxford
Dictionary
1.
To
work
up
(material)
into
forms
suitable
for
use.
2.
To
make
or
fabricate
from
material;
to
produce
by
labour
(now
esp.
on
a
large
scale).
In
the
Imperial
Dictionary
1.
To
make
or
fabricate
from
raw
materials,
and
work
into
forms
convenient
for
use,
especially
by
more
or
less
complicated
processes;
as,
to
manufacture
cloth,
nails
or
glass.
2.
To
work
into
suitable
forms
for
use;
as,
to
manufacture
wool,
cotton,
silk
or
iron.
I
think
that
the
builder
of
a
yacht
is
a
manufacturer
or
producer
in
the
broad
sense
of
these
words.
Counsel
for
the
defendant
submitted
that
the
builder
of
a
ship
is
in
a
position
analogous
to
that
of
a
man
who
builds
a
house.
In
support
of
this
proposition,
counsel
relied
on
the
definition
found
in
Words
and
Phrases
Judicially
Defined,
Vol.
5,
manufacturer,
p.
4356,
under
the
heading
"‘Repairer
of
vessel,’’
where
it
is
said:
"‘The
term
‘manufacturer,’
within
the
meaning
of
Laws
1880,
ch.
542,
sec.
3,
exempting
manufacturers
from
certain
taxes,
does
not
include
a
builder
and
repairer
of
vessels.
Undoubtedly,
using
the
word
in
its
broadest
sense,
the
builder
and
repairer
of
a
vessel
or
a.
house,
even,
might
be
called
a
manufacturer.
In
either
case
such
builder
takes
the
raw
material,
and
by
the
hand,
or
by
machinery
and
tools,
fashions
it
into
form
and
shape
for
use.
But
this
is
not
the
ordinary
and
general
meaning
to
be
given
to
the
word,
and
it
is
such
general
and
ordinary
meaning
which
words
are
to
receive
in
the
construction
of
statutes.
People
v.
New
York
Floating
Dock
Co.
(N.Y.),
63
How.
Prac.
451,
453.”
I
feel
unable
to
agree
with
this
contention.
I
can
see
no
analogy
between
a
shipwright
and
a
builder
of
houses.
I
do
not
think
that
the
verb
‘‘manufacture’’
can
apply
to
immovables,
i.e.,
to
buildings
in
general
and
their
accessories.
The
verb
‘‘manufacture,’’
as
the
verb
'“fabricate,”
applies
essentially,
I
would
even
say
solely,
to
movables,
i.e.,
to
effects
or
goods
of
every
nature
and
description.
Counsel
also
relied
on
the
judgment
in
the
case
of
The
People
of
the
State
of
New
York
v.
The
New
York
Floating
Dry
Dock
Company,
cited
in
the
extract
from
Words
and
Phrases
Judicially
Defined
hereinabove
reproduced.
This
judgment
was
appealed
and
affirmed.
See
92
New
York
Reports,
Court
of
Appeals
(Sickels
47)
487.
In
my
opinion,
the
import
of
the
judgment
of
the
Court
of
Appeals
in
the
case
of
The
People
of
the
State
of
New
York
v.
The
New
York
Floating
Dry
Dock
Company
is
not
as
broad
and
absolute
as
the
definition
contained
in
Words
and
Phrases
Judicially
Defined
would
seem
to
intimate.
The
action
was
one
for
the
recovery
of
taxes
claimed
to
be
imposed
by
ch.
542
of
the
Laws
(of
the
State
of
New
York)
of
1880;
paragraph
3
of
the
statute
in
question
enacts
{inter
alia)
that:
“Every
corporation,
joint-stock
company,
or
association
whatever,
now
or
hereafter
incorporated,
organized,
or
formed
under,
by,
or
pursuant
to
law
in
this
state
or
in
any
other
state
or
country,
and
doing
business
in
this
state,
except
only
savings
banks
and
institutions
for
savings,,
life
insurance
companies,
banks,
foreign
insurance
companies,
manufactur
ing
or
mining
corporations,
or
companies
wholly
engaged
in
carrying
on
manufacture,
or
mining
ores
within
this
state,
and
agricultural
and
horticultural
societies,
associations
or
corporations,
which
exceptions,
however,
shall
not
include
gas
companies,
trust
companies,
electric
and
steam
heating,
lighting
and
power
companies,
shall
be
liable
to
and
shall
pay
a
tax,
as
a
tax
upon
its
franchise
or
business,
into
the
state
treasury
annually,
to
be
computed
as
follows:
..
.’’
Miller,
J.,
in
delivering
judgment
for
the
Court
of
Appeals,
after
stating
that
the
defendant
company
was
incorporated
"‘for
the
purpose
of
constructing,
using
and
providing
one
or
more
dry-docks,
or
wet-docks,
or
other
conveniences
and
structures
for
building,
raising,
repairing
and
coppering
vessels
and
steamers
of
every
description,’’
said
(at
p.
488)
:
"
"
The
act
under
which
the
defendant
was
incorporated
was
of
a
special
character,
and
the
specification
of
the
business
which
the
defendant
was
authorized
to
carry
on,
under
its
charter,
which
states
the
general
purpose
and
object
of
the
incorporation,
does
not
bring
it
within
the
provision
of
sec.
3
of
said
Act
of
1880,
which
exempts
manufacturing
corporations
from
its
provisions
as
to
taxation.
The
term,
‘manufacturing
corporation,’
cannot,
we
think,
be
considered
as
comprehending
the
business
of
the
defendant,
if
the
words
employed
are
interpreted
according
to
the
common
understanding
of
such
language.
"While
the
act
provides
for
the
constructing,
using
and
providing
one
of
more
dry-
or
wet-docks
or
other
conveniences
and
structures
for
the
purposes
named,
its
main
object
evidently
is
building,
raising,
repairing
and
coppering
vessels.
The
principal
portion
of
the
work
which
the
corporation
is
authorized
to
perform
relates
to
the
improvement
of
vessels
which
have
already
been
constructed,
and
not
to
the
construction
of
the
same,
and
taking
all
the
parts
enumerated
together
they
cannot
be
considered
as
embraced
within
the
term
‘manufacturing,’
and,
if
regarded
separately,
we
think,
they
do
not
come
within
the
definition
of
the
term
employed.
According
to
Webster
a
manufacturer
is
one
who
works
raw
materials
into
wares
suitable
for
use.
The
constructing,
using
and
providing
of
one
or
more
docks,
as
used
in
the
act
of
1880,
is
no
more
a
manufacturing
within
the
meaning
of
that
word
than
would
be
the
building
of
warehouses
and
elevators
for
the
carrying
on
of
the
business
of
warehousemen
OI‘
the
erection
of
buildings
or
residences.”
The
judgment
of
the
Court
of
Appeals
is
not
quite
as
formal
and
explicit
as
that
of
the
Court
of
first
instance.
Besides
the
Act
on
which
it
is
based
is
materially
different
from
the
one
with
which
we
are
concerned.
The
taxpayer,
in
the
case
of
The
People
of
the
State
of
New
York
v.
The
New
York
Floating
Dry
Dock
Company,
was
seeking
to
be
exempted
from
taxation
and,
for
that
purpose,
to
be
brought
within
the
limits
of
an
exception.
The
courts
are
not
as
a
rule
disposed
to
widen
the
scope
of
an
exception;
it
is
well
settled
law
that
exceptions
must
be
construed
strictly.
However
it
may
be,
I
may
say,
with
all
due
respect,
that
I
do
not
consider
myself
bound
by
this
judgment
and
that,
if
it
purports
to
decide
that
a
builder
of
vessels
is
not
a
manufacturer
within
the
common
and
usual
acceptation
of
the
word,
I
simply
cannot
agree
with
it.
The
second
reason
invoked
by
counsel
for
the
defendant
is
that
his
client
is
not
a
manufacturer
or
producer
as
described
in
the
Act,
inasmuch
as
the
words
manufacturer
or
producer
in
the
statute
connote
manufacturing
or
producing
in
the
way
of
a
business,
which
would
exclude
an
isolated
transaction,
such
as
the
building
of
a
yacht
by
the
defendant
for
his
personal
use.
The
question,
I
must
admit,
is
rather
delicate
and
it
offers
more
difficulty
than
the
other;
its
solution
may
be
far-reaching,
as
it
is
liable
to
affect
a
large
number
of
people.
Was
it
the
legislators’
intention
to
tax
only
the
manufacturers
and
producers
who
manufacture
or
produce
in
the
way
of
trade,
or
was
the
tax
imposed
by
sec.
87
aimed
at
persons
producing
or
manufacturing
for
their
own
personal
use?
This
is
the
first
question
which
I
have
to
determine.
The
Supreme
Court
of
Canada
in
the
case
of
Bank
of
Nova
Scotia
v.
The
King
[1930]
S.C.R.,
174
held
that
a
bank,
which
maintained
a
stationery
department,
in
which
it
had
a
printing
plant
with
which
it
printed
its
ledger.
sheets,
forms,
note-paper,
etc.,
required
for
its
banking
business,
was,
in
respect
of
this
printed
material,
a
manufacturer
or
producer
within
the
meaning
of
the
Act
and
therefore
liable
to
a
consumption
or
sales
tax
on
the
value
of
the
articles
so
printed.
The
following
remarks
of
Anglin,
C.J.,
who
delivered
the
judgment
of
the
Court,
are
interesting
(p.
179)’:
‘We
agree
with
the
learned
President
of
the
Exchequer
Court
that
as
a
printer,
lithographer
or
engraver,
which
produced,
for
its
own
use
and
not
for
sale,
the
goods
in
question,
viz.,
stationery
supplies
for
its
head
office
and
branches,
the
bank
was
a
producer
within
the
meaning
of
that
term,
as
used
in
clause
(a)
of
sec.
86
of
the
Special
War
Revenue
Act,
R.S.C.
1927,
ch.
179,
and
that
the
goods
in
question
were
produced
in
Canada
by
it
within
the
meaning
of
that
clause.
"We
cannot
find
anything
is
the
statute
to
support
the
view
put
forward
by
counsel
for
the
appellant
that
its
application
is
confined
to
a
manufacturer
or
producer
whose
business
is
manufacturing
or
producing
for
sale.
That
construction
of
the
Act
would
involve
the
exclusion
from
our
consideration
of
clause
(d)
of
see.
87,
which,
in
our
opinion,
was
introduced
to
remove
any
doubt
that
the
statute
was
intended
to
apply
to
a
case
such
as
that
at
bar.”
Another
decision
to
the
effect
that
the
manufacturer
using
for
his
own
purpose
articles
produced
or
manufactured
by
him
is
bound
to
pay
the
consumption
or
sales
tax
on
these
articles
was
rendered
by
the
Supreme
Court
of
Canada
in
the
case
of
The
King
v.
Fraser
Companies
Limited
[1931]
S.C.R.
490.
The
defendant,
Fraser
Companies
Limited,
was
a
manufacturer
of
lumber
for
sale;
it
consumed
a
portion
of
its
lumber
in
building
operations
carried
on
over
a
period
of
years;
the
lumber
so
consumed,
taken
from
stock
in
the
company’s
yards,
had
been
produced
and
manufactured
in
the
ordinary
course
of
the
company’s
business
of
manufacturing
for
sale;
it
had
not
been
produced
or
manufactured
especially
for
the
purpose
for
which
it
was
used.
Smith,
J.
delivering
the
judgment
of
the
majority
of
the
Court,
said
(p.
493)
:
"
"
The
view
taken
in
the
court
below
(that
the
lumber
consumed
by
the
defendant
in
building
operations
was
produced
in
the
ordinary
course
of
business
for
sale
and
not
specifically
for
use
by
the
defendant
within
the
meaning
of
sec.
87(d))
would
result
in
the
introduction
of
an
exception
to
the
general
rule
that
all
goods
produced
or
manufactured
are
to
pay
a.
tax,
and
would
amount
to
a
discrimination
in
favour
of
a
particular
consumer.
As
an
example,
it
is
not
unusual
for
a
manufacturer
engaged
in
the
production
and
manufacture
of
lumber
for
sale
to
engage
at
the
same
time
in
the
business
of
a
building
contractor.
He
manufactures
his
lumber
for
sale,
and,
as
a
general
rule,
would
not
manufacture
any
specific
lumber
for
use
in
connection
with
his
building
contracts,
but
would
simply
take
lumber
for
these
purposes
from
the
general
stock
manufactured
for
sale,
and
might
thus,
under
the
view
taken
in
the
court
below,
escape
taxation
on
all
lumber
thus
diverted
from
the
general
stock
manufactured
for
sale.’’
Another
case
in
which
the
same
principle
was
sanctioned,
although
the
action
was
dismissed
on
another
ground,
is
that
of
The
King
v.
Henry
K.
Wampole
&
Co.
[1931]
S.C.R.
494.
I
may
quote
from
the
notes
of
Anglin,
C.J.,
speaking
for
the
majority
of
the
Court,
the
following
remarks
(p.
496,
in
fine)
:
"My
construction
of
clause
(d)
of
sec.
87
is
that
the
‘use’
by
the
manufacturer
or
producer
of
goods
not
sold
includes
any
use
whatever
that
such
manufacturer
or
producer
may
make
of
such
goods,
and
is
wide
enough
to
cover
their
‘use’
for
advertising
purposes
by
the
distribution
of
them
as
free
samples,
as
is
the
case
here.
I
am,
therefore,
with
great
respect,
unable
to
agree
in
the
reasons
assigned
by
the
learned
trial
judge
for
dismissing
this
petition
[1931]
Ex.C.R.
7).
and
at
page
497
:
“If
the
cost
or
value
of
these
goods
used
as
samples
has
already
been
a
subject
of
the
sales
tax
in
this
way,
it
would
seem
to
involve
double
taxation
if
they
should
now
be
held
liable
for
sales
tax
on
their
distribution
as
free
samples.
But
for
the
admission
of
paragraph
4,
however,
I
should
certainly
have
been
prepared
to
hold
that
the
‘use’
by
the
company
of
goods
manufactured
by
it
as
free
samples
for
advertising
purposes
is
a
‘use’
within
clause
(d)
of
sec.
87
of
the
Special
War
Revenue
Act,
R.S.C.
1927,
ch.
179.”
The
first
case
cited
is
the
most
in
point.
In
the
other
cases
the
defendants
were
admittedly
manufacturers
or
producers
within
the
purport
of
the
Special
War
Revenue
Act
and
subject
to
the
consumption
or
sales
tax
under
sec.
86
of
said
Act.
The
only
question
in
dispute
was
whether
the
use
made
by
the
defendants
of
their
products,
lumber
for
construction
purposes
in
the
one
case
and
samples
for
advertising
purposes
in
the
other,
fell
within
the
meaning
of
that
word
as
used
in
subsec.
(d)
of
sec.
87.
In
the
case
of
the
Bank
of
Nova
Scotia
v.
The
King,
it
is
idle
to
say
that
the
bank,
as
such,
was
not
a
manufacturer
or
producer.
The
Supreme
Court
however,
affirming
the
judgment
of
the
Exchequer
Court
in
its
conclusion,
held
that
the
bank,
having
a
department
where
it
printed
all
the
stationery
required
for
its
banking
operations,
was
to
be
considered,
under
subsec.
(d)
of
sec.
87
(previously
subsec.
13
of
sec.
19BBB
of
the
Special
War
Revenue
Act,
1915,
5
Geo.
V,
ch.
8,
as
enacted
by
13-14
Geo.
V,
ch.
70,
sec.
6),
with
regard
to
its
printing
plant
or
department,
a
manufacturer
or
producer.
Does
the
same
principle
apply
in
the
case
of
an
isolated
act
by
a
person
who
is
not
a
manufacturer
or
producer
by
trade?
Must
a
man
building,
as
in
this
case,
a
yacht,
or
building
any
other
object
or
article,
for
instance
a
truck,
a
rig,
or,
on
a
smaller
scale,
a
pair
of
skis,
a
table,
a
tool,
for
his
personal
use,
with
no
idea
of
selling
it,
be
considered
a
manufacturer
or
producer
for
the
purpose
of
the
Act?
I
must
admit
that
I
have
been
unable
to
find
any
decision
or
authority
on
the
point,
although
I
have
spent
considerable
time
in
looking
up
the
jurisprudence
dealing
with
consumption
or
sales
tax.
After
reading
sections
85,
86
and
87
separately
and
in
conjunction
with
one
another
and
giving
the
matter
careful
consideration,
I
have
reached
the
conclusion
that
subsec.
(d)
of
sec.
87
does
not
apply
to
an
isolated
act
like
the
one
with
which
we
are
concerned;
I
do
not
think
that
it
was
the
intention
of
the
legislators
to
impose
a
tax
on
a
person
who,
not
being
a
manufacturer
by
trade,
manufactures
or
produces,
for
his
own
use
and
with
no
intent
of
disposing
of
it
by
sale
or
otherwise,
an
object
or
article,
which
is
not
used
in
connection
with
any
trade
or
business.
If
it
was
the
legislators’
intention
to
impose
such
a
tax,
I
think,
they
should
have
said
so
clearly.
If
there
is
ambiguity
in
a
taxing
statute,
the
ambiguous
provision
must
be
interpreted
favourably
to
the
taxpayer;
if
there
exists
any
doubt,
the
taxpayer
must
have
the
benefit
of
the
doubt.
I
may
add,
although
this
consideration
may
be
of
lesser
importance
and
weight,
that
presumably
the
defendant
paid,
indirectly
perhaps
but
paid
nevertheless,
the
consumption
or
sales
tax
on
all
the
materials
used
in
the
construction
of
the
Cora
Marie
and
that
in
charging
a
tax
on
the
value
of
the
vessel
he
would
be
called
upon
to
pay
a
double
tax
on
at
least
the
value
of
such
materials.
For
all
these
reasons,
I
believe
that
the
action
is
unfounded
and
that
it
must
be
dismissed.
The
defendant
wil
be
entitled
to
his
costs
against
the
plaintiff.
Judgment
accordingly.
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