Sir
LYMAN
P.
Durr
C.J.C.:—The
interrogatory
referred
to
us
is
in
the
following
terms
:
"'Is
Section
16
of
the
Special
War
Revenue
Act,
as
enacted
by
section
1
of
Chapter
54
of
the
Statutes
of
1932
and
amended
by
section
4
of
Chapter
27
of
the
Statutes
of
1940-41
ultra
vires
of
the
Parliament
of
Canada
either
in
whole
or
in
part,
and
if
so
in
what
particular
or
particulars
or
to
what
extent?’’
The
said
s.
16,
as
amended,
reads
as
follows:
"16(1)
Every
person
resident
in
Canada
who,
after
the
thirty-
first
day
of
December,
1931,
insures
or
has
insured
his
property
situate
in
Canada
in
which
he
has
an
insurable
interest,
other
than
that
of
an
insurer
of
such
property,
or
renewscor
has
renewed
any
such
insurance,
against
risks
other
than
marine
risks,
"‘(a)
with
any
British
or
foreign
company;
or
"‘(b)
with
any
exchange,
the
chief
place
of
business
of
which
exchange
or
of
its
principal
attorney-in-fact
is
situate
outside
of
Canada,
which,
on
or
before
the
first
day
of
July,
1932,
or
at
the
time
such
insurance
is
effected
or
renewed
if
after
the
last
mentioned
date,
is
not
authorized
under
the
laws
of
the
Dominion
of
Canada
to
transact
the
business
of
insurance,
shall,
on
or
before
the
first
day
of
March,
1933,
and
on
or
before
the
first
day
of
March
in
each
year
thereafter,
pay
to
the
Minister,
in
addition
to
any
other
tax
payable
under
any
other
existing
law
or
statute,
a.
tax
of
ten
per
centum
of
the
net
premiums
paid
or
payable
by
such
person
in
respect
of
such
insurance
for
the
next
preceding
calendar
year.
((2)
For
the
purpose
of
this
section,
every
corporation
carrying
on
business
in
Canada,
shall
be
deemed
to
be
a
person
resident
in
Canada.”
I
have
given
to
the
arguments
advanced
in
support
of
the
validity
of
this
enactment,
as
well
as
to
those
against
it,
the
most
prolonged
and,
I
must
admit,
anxious
consideration.
Some
of
the
arguments
relied
upon
by
the
Provinces
seem
to
open
up
rather
far-reaching
topics
touching
the
powers
of
the
Parliament
of
Canada
concerning
intercourse
with
other
countries.
I
find
it
unnecessary
to
discuss
such
topics,
because
I
think
the
question
raised
by
the
reference
fails
to
be
dealt
with
upon
comparatively
narrow
ground.
I
am
unable
to
accept
the
argument
that
the
enactment
is
prima
facie
valid
as
such
and
that
the
invalidity
of
the
existing
legislation
relating
to
the
transaction
of
the
business
of
insurance
is
immaterial.
In
view
of
the
decision
in
the
Insurance
ease
of
1932
(Re
Insurance
Act
&
Special
War
Revenue
Act,
A.-G.
Que.
v.
A.-G.
Can.,
[1932],
1
D.L.R.
97,
A.C.
41,
53
Que.
K.B.
34),
I
see
no
eseape
from
the
proposition
advanced
by
the
Provinces
that
s.
16
of
the
Special
War
Revenue
Act,
R.S.C.
1927,
e.
179,
as
amended
by
the
statutes
of
1940
to
1941,
is,
in
point
of
law,
so
related
to
the
insurance
legislation
affecting
British
and
foreign
companies
and
extra-Canadian
exchanges
that
if
the
insurance
legislation
is
invalid
s.
16
must
fall
with
it.
In
this
respect
I
see
no
admissible
distinction
between
the
two
cases.
The
point
of
substance,
therefore,
is
whether
this
insurance
legislation
is
invalid
as
a
whole,
or
in
such
degree
as
to
strike
s.
16
with
sterility.
It
is
convenient
first
to
refer
to
the
Act
relating
to
British
companies.
By
s.
2
(b)
a
British
company
is
thus
defined:
‘
"British
company’
means
any
corporation
incorporated
under
the
laws
of
the
United
Kingdom
of
Great
Britain
and
Northern
Ireland
or
any
British
Dominion
or
possession
other
than
Canada
or
a
province
of
Canada
for
the
purpose
of
carrying
on
the
business
of
insurance.’’
Sections
116
and
117
are
in
these
words:
•
116.
There
shall
be
established
and
maintained
in
the
Department
of
Insurance
a
register
in
which
shall
be
entered
the
names
af
all
British
companies
registered
under
this
Part
and
to
which
certificates
of
registry
are
granted.
4117.
No
British
company
shall
transact
the
business
of
insurance
in
Canada,
save
as
hereinafter
expressly
provided,
unless
it
is
registered
and
holds
a
certificate
of
registry
from
the
Minister.
’
‘
Section
118
requires,
inter
alia
as
a
condition
of
registration,
that
a
British
company
shall
make
a
deposit
with
the
Minister
in
any
of
the
securities
specified
in
s.
55
of
the
Act
in
the
following
sums,
namely:
«(i)
for
a
certificate
of
registry
to
transact
the
business
of
life
insurance
or
fire
insurance,
the
sum
of
one
hundred
thousand
dollars,
and
"‘
(ii)
for
a
certificate
of
registry
to
transact
any
other
class
of
insurance
business,
such
sum
as
the
Treasury
Board
may
determine.
’
‘
It
appears
then
that
by
this
legislation
a
British
company
is
prohibited
from
making
any
contract
of
insurance
in
Canada,
that
is
to
say
in
any
Province
of
Canada,
and
from
performing
in
any
such
Province
any
act
of
inducement
to
enter
into
any
such
contract,
or
any
act
relating
to
the
performance
of
any
such
contract,
or
rendering
any
service
connected
with
any
such
contract
in
any
such
Province,
unless
it
is
registered,
and
among
the
conditions
of
such
registration
is
that
just
mentioned.
One
must
consider
the
effect
of
these
enactments
in
practice.
Prior
to
the
passing
of
this
statute
a
British
company
has
an
agency
in
Toronto.
It
has
complied
with
the
provisions
of
the
provincial
law,
whatever
they
may
be,
in
respect
of
giving
security
for
the
benefit
of
its
policy
holders.
The
Dominion
enactment
comes
into
operation
and
the
British
company
and
its
agents
immediately
come
under
the
prohibition
of
s.
117
and
the
company
and
its
agents
become
subject
to
the
penalties
prescribed
by
s.
142,
which
become
exigible
on
the
performance
of
any
one
or
more
of
the
acts
constituting
by
definition
the
"business
of
insurance’’,
unless
and
until
it
becomes
registered
under
the
Dominion
statute.
I
do
not
perceive
any
valid
reason
for
holding
that
it
would
be
beyond
the
powers
of
a.
Province,
in
exercise
of
its
authority
to
regulate
the
business
of
insurance
in
the
Province,
to
require
the
registration
of
insurers,
and
to
exact
as
conditions
of
obtaining
such
registration
the
deposit
of
security
of
a
character
similar
to'that
required
by
s.
118.
Assuming
that
the
Dominion,
in
exercise
of
its
control
of
trade
and
commerce
under
the
second
clause
of
s.
91,
may
regulate
the
business
of
insurance
carried
on
by
British
companies
as
a
branch
of
external
trade
and
commerce,
this
does
not
give
the
Dominion
authority
to
regulate
their
strictly
provincial
business;
and
it
is
my
opinion
that
ss.
116,
117
and
118,
if
valid,
do
effect
the
regulation
of
such
business.
The
general
principle
is
well-settled
and
well-known.
(The
King
v.
Eastern
Terminal
Elevator
Co.,
[1925],
3
D.L.R.
1,
S.C.R.
484;
A.-G.
Can.
v.
A.-G.
Ont.,
Reference
re
Weekly
Rest
in
Industrial
Undertakings
Act
etc.,
[1937],
1
D.L.R.
673,
A.C.
326).
The
judgment
of
Lord
Dunedin
in
the
Insurance
case
of
1932
supra
does
not
explicity
deal
with
the
provisions
of
the
statute
then
under
review
that
correspond
with
ss.
116,
117
and
118.
Nevertheless,
I
think
when
that
judgment
is
read
as
a
whole
its
language
points
rather
to
the
conclusion
that,
in
the
view
of
the
great
and
lamented
Judge
who
delivered
it,
these
provisions
stood
in
the
same
category
as
those
relating
to
the
forms
of
contracts
and
those
governing
transactions
between
an
insurance
company
and
its
agents.
It
is
not
necessary,
however,
to
consider
whether
this
point
is
strictly
ruled
by
Lord
Dunedin’s
judgment
in
the
sense
that
these
particular
provisions
were
passed
upon.
The
principle
of
exclusive
provincial
control
of
the
business
of
insurance
within
the
Province
lies
at
the
foundation
of
the
judgment.
From
this,
it
follows
also
that
the
corresponding
enactments
in
the
Foreign
Insurance
Companies
Act
1932
(Can.),
c.
47
are
not
intra
vires.
Those
enactments,
being
legislation
in
relation
to
the
business
of
insurance
within
the
Province,
are
not
(it
flows
from
the
reasoning
of
that
judgment)
alien
legislation
in
the
sense
contemplated
by
the
judgment
in
A.-G.
Can.
v.
A.-G.
Alta.,
26
D.L.R.
288,
[1916]
1
A.C.
588.
On
this
point
1
think
the
words
of
Lord
Dunedin
in
[1932]
1
D.L.R.
at
p.
105,
A.C.
at
p.
51
are
conclusive
:
"‘What
has
got
to
be
considered
is
whether
this
is
in
a
true
sense
of
the
word
alien
legislation,
and
that
is
what
Lord
Haldane
meant
by
‘properly
framed
legislation.’
Their
Lordships
have
no
doubt
that
the
Dominion
Parliament
might
pass
an
Act
forbidding
aliens
to
enter
Canada
or
forbidding
them
so
to
enter
to
engage
in
any
business
without
a
licence,
and
further
they
might
furnish
rules
for
their
conduct
while
in
Canada,
requiring
them,
e.g.,
to
report
at
stated
intervals.
But
the
sections
here
are
not
of
that
sort,
they
do
not
deal
with
the
position
of
an
alien
as
such;
but
under
the
guise
of
legislation
as
to
aliens
they
seek
to
intermeddle
with
the
conduct
of
insurance
business,
a
business
which
by
the
first
branch
of
the
1916
case
has
been
declared
to
be
exclusively
subject
to
provincial
law.
Their
Lord-
ships
have,
therefore,
no
hesitation
in
declaring
that
this
is
not
‘properly
framed’
alien
legislation.’’
The
case
of
extra-Canadian
exchanges
is
not
distinguishable.
It
follows
that
s.
16
is
ultra
vires.
It
is
perhaps
unnecessary
to
add
that
nothing
I
have
said
is
in
any
way
inconsistent
with
the
principle
which
precludes
a
Provinee
from
impairing
by
legislation
the
status
and
powers
of
a
Dominion
company.
The
interrogatory
referred
to
us
should
be
answered
‘‘
Yes,
in
its
entirety.
”
Email this Content