THE
CHIEF
J
USTICE
:—The
following
questions
of
law,
touching
the
interpretation
of
the
British
North
America
Acts,
1867
to
1949,
have
been
referred
to
the
Supreme
Court
of
Canada
for
hearing
and
consideration
:
1.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada?
2.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of
any
obligation
under
any
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax
?
3.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
license,
permit
or
certificate
for
the
export
or
import
of
goods
?
List
of
Statutes
referred
to
in
the
above
questions:
Newfoundland
1.
6
Geo.
V,
Chapter
4
(1915)
2.
8
Geo.
V,
Chapter
3
(1917)
3.
9-10
Geo.
V,
Chapter
12
(1919)
4.
14
Geo.
V,
Chapter
1
(1923)
5.
15
Geo.
V,
Chapter
27
(1925)
6.
18
Geo.
V,
Chapter
4
(1927)
7.
25-26
Geo.
V,
Chapter
42
(1935)
8.
2
Geo.
VI,
Chapter
53
(1938)
9.
6
Geo.
VI,
Chapter
35
(1942)
10.
6
Geo.
VI,
Chapter
45
(1942)
11.
7
Geo.
VI,
Chapter
56
(1943)
12.
11
Geo.
VI,
Chapter
8
(1947)
Upon
the
Reference,
this
Court
heard
arguments
from
counsel
representing
the
Attorney-General
of
Canada,
the
Attorney-
General
of
Newfoundland
and
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited.
The
Statutes
of
Newfoundland
referred
to
in
the
questions
are
all
statutes
enacted
by
the
Governor,
Legislative
Council
and
House
of
Assembly
of
Newfoundland
or
the
Governor
by
and
with
the
advice
of
the
Commission
of
Government
before
the
Union
of
Newfoundland
with
Canada.
No
question
is
raised
as
to
the
validity
or
effect
of
these
statutes
before
the
Union.
Substantially
all
of
these
statutes
are
concerned
with
giving
effect
to
and
carrying
out
so-called
agreements
between
a
corporation
and
the
Government
of
Newfoundland.
The
1915
to
1919
statutes
were
enacted
in
relation
to
the
Newfoundland
Products
Corporation,
Limited.
The
name
of
this
Company
was
then
changed
to
the
Newfoundland
Power
and
Paper
Company
Limited
and
the
1923
and
1925
statutes
use
this
name.
The
1927
statutes,
amongst
other
things,
confirm
the
substitution
under
the
agreements
of
a
new
corporation
for
the
earlier
one,
the
new
corporation
being
the
International
Paper
Company
of
Newfoundland
Limited.
Thereafter,
the
name
of
this
corporation
was
changed
on
November
9,
1927,
to
"‘International
Power
and
Paper
Company
of
Newfoundland
Limited’’
and
on
August
18,
1938,
to
"‘Bowater’s
Newfoundland
Pulp
and
Paper
Mills
Limited”,
the
present
name
of
the
Company.
Since
all
the
statutes
and
agreements
now
relate
to
the
last-named
Company,
reference
will
be
made
only
to
the
‘‘Company’’,
by
which
is
meant
the
last-named
Company.
The
original
operations
of
the
Company
were
the
utilization
of
water
powers
and
mineral
resources
in
Newfoundland
for
the
manufacture
of
a
fertilizer.
Subsequently,
the
operations
were
extended
to
the
generation
of
power
for
the
manufacture
of
pulp
and
paper
products.
Later
still,
the
operations
of
the
Company
covered
the
cutting
and
export
of
timber
and
related
activities.
The
executive
government
of
Newfoundland
and
the
Company,
apparently,
from
time
to
time
conducted
negotiations
as
to
the
operations
of
the
Company.
The
government
was
interested
in
promoting
the
development
of
industry
in
Newfoundland.
The
Company
was
interested
in
obtaining
water
powers,
lands,
mineral
rights,
timber
rights
and
concessions
for
its
operations.
It
also,
apparently,
needed
the
financial
support
of
the
government
by
way
of
guaranteeing
loans
raised
by
the
Company.
As
a
result
of
these
negotiations
these
so-
called
agreements
were
arrived
at
between
the
Company
and
the
executive
government.
The
agreements,
amongst
other
things,
contained
terms
making
special
provision
as
to
the
taxation
of
the
Company
and
in
respect
of
activities
carried
on
by
it.
The
agreement
of
1927
appears
to
have
supplanted,
for
practical
purposes,
earlier
provisions
for
this
purpose
in
the
agreements
of
1923
and
1915.
Clause
2
of
the
1927
agreement
contains
extensive
provisions
both
new
and
by
way
of
amendment
to
earlier
provisions.
Its
provisions
were
also
later
amended
by
the
1938
agreement.
The
effect
of
the
taxation
provisions
of
these
agreements
and
statutes,
still
in
force
before
the
union
of
Newfoundland
to
Canada,
may
be
stated
generally
speaking
as
follows:
(b)
The
stock
and
shares
and
the
bonds,
debentures,
debenture
stock,
mortgage
and
other
securities
of
the
Company,
and
all
issues,
transfers,
sales
and
other
dispositions
of,
purchases,
holding
and
receipts
of
the
same,
and
the
dividends
on
such
stock
and
shares
and
interest
on
such
securities,
and
the
receipt
thereof
by
the
holder
other
than
holders
(except
the
International
Paper
Company,
a
corporation
of
the
State
of
New
York,
or
any
successor
to
substantially
all
its
property
and
assets
or
any
subsidiary
of
said
International
Paper
Company
or
of
its
said
successor)
domiciled
in
Newfoundland,
shall
be
exempt
from
taxation
for
a
period
of
fifty
years
from
the
date
hereof,
provided
that
the
Company
shall
not
be
exempt
from
any
fees
payable
upon
the
registration
in
the
Registry
of
Deeds
of
a
document,
deed
or
instrument
which
apply
to
all
documents,
deeds
and
instruments
generally.
(1927
Agreement;
cl.
2
para
(b)
unamended
;
Case
p.
60,
1.
12.)
(c)
The
Company
shall
pay
to
the
Government
in
respect
of
its
income
for
each
year,
beginning
with
the
year
1928,
and
ending
with
the
year
1973,
before
deduction
of
interest,
depreciation
and
depletion,
a
tax
of
twenty
per
cent
of
such
income,
provided
that
if
the
tax
in
any
year
so
calculated
would
exceed
the
maximum
tax
below
defined
the
income
applicable
to
the
payment
of
interest
and
to
depreciation
and
depletion
shall
be
exempt
from
taxation
to
such
extent
as
shall
be
necessary
in
order
that
the
tax
shall
not
exceed
the
maximum
tax
below
defined,
and
provided
further
that
if
the
tax
so
calculated
after
exempting
all
income
applicable
to
the
payment
of
interest
and
to
depreciation
and
depletion
would
still
exceed
the
maximum
tax
below
defined,
then
the
rate
per
cent
for
calculation
of
the
tax
shall
be
reduced
to
such
extent
as
shall
be
necessary
in
order
that
the
tax
shall
not
exceed
the
maximum
tax
below
defined.
The
maximum
tax
in
respect
of
the
income
for
each
of
the
years
1928,
1929,
1930
and
1931
shall
be
$75,000,
and
for
each
of
the
years
1932
to
1973,
inclusive,
shall
be
$150,000.
Dividends
and
interest
received
by
the
Company
shall
be
included
in
its
income.
Such
tax
shall
be
payable
on
or
before
March
31
of
the
succeeding
year.
And
except
as
aforesaid
and
subject
to
Section
3
of
the
Act
of
1915
the
Company
shall
be
exempt
from
all
taxation
of
every
kind
whatsoever
other
than
duties
(including
Sales
Tax)
levied
under
the
general
laws
of
the
Colony
on
goods
imported
by
the
Company
and
not
otherwise
exempt.
Provided,
however,
that
nothing
in
this
clause
contained
shall
be
construed
to
exempt
individual
officers,
shareholders
or
employees
of
the
Company
from
any
taxation
otherwise
payable
by
them:
Provided
further
that
this
Clause
shall
remain
in
force
during
the
period
ending
30th
June,
1973,
and
after
that
date
shall
cease
to
have
effect
in
toto,
(1923
Act.
s.
13;
Case
p.
27,
1.
35
as
amended
by
1927
Agreement
cl.
2,
para
(c)
;
Case
p.
60,
1.
27.)
(d)
All
materials,
articles
and
things
required
from
time
to
time
for
construction,
installation
and
equipping
of
the
company’s
water
power,
hydro-electric,
electrical,
ground
wood
pulp,
chemical
pulp,
cellulose,
paper
and
barking
mills,
buildings,
plants
and
works
and
all
buildings
and
plants
incidental
thereto,
wharves,
docks,
quays,
piers,
lights
and
buoys,
warehouses,
woods
and
logging
operations,
fire
protection,
transmission
lines,
railways,
roads
and
towns
(including
all
houses,
buildings
and
structures,
hospitals
and
laboratories
erected
by
or
for
the
Company
on
any
townsite
or
protective
area
around
it
owned
or
controlled
by
it,
sewerage,
water,
heating
and
lighting
systems,
and
any
other
public
amenities
or
utilities
which
may
be
provided
by
the
Company)
vessels,
boats,
mechanical
transport
for
goods,
aircraft,
and
telegraph
and
telephone
equipment
all
for
the
company’s
own
operations
for
original
installation
or
for
additions
or
extensions
but
not
in
substitution
for
old
shall
until
the
2nd
day
of
August,
1952,
be
admitted
into
Newfoundland,
free
of
duties
and
taxes,
subject,
however,
to
any
prohibition
of
general
application
against
the
importation
of
any
articles
and
except
as
provided
below
in
subclause
(g)
of
this
Clause
2.
(1927
Agreement,
cl.
2,
para.
(d),
Case
p.
61,
1.
51,
as
amended
by
1938
Agreement,
el.
25,
Case
p.
99,
1.
22.)
(e)
All
materials
not
procurable
in
Newfoundland
of
quality
and
at
prices
which
shall
be
satisfactory
to
the
Company
required
for
the
purpose
of
the
manufacture
of
the
products
of
the
Companies’
and/or
its
subsidiary
Companies’
electro-chemical,
electro-metallurgical
and
other
electric
industries
not
concerned
with
pulp
and
paper
making
shall
for
the
period
of
twenty
(20)
years
calculated
from
the
date
of
the
entry
into
commercial
operation
of
each
of
such
industries
be
admitted
into
the
Colony
free
of
taxes
and
duty.
(1915
Agreement
el.
12,
Case
p.
19,
1.
19
as
amended
by
1923
Act,
s.
6,
Case,
p.
26,
1.
16,
as
amended
by
1927
Agreement,
cl.
2,
para.
(e)
Case
p.
61,
1.
33.)
(f)
On
materials,
articles
and
things
required
by
the
Company
for
renewals
or
replacements
of
or
repairs
to
or
for
use
in
substitution
for
materials,
articles
and
things
imported
free
of
duty
or
of
or
to
or
for
materials,
articles
and
things
previously
imported
for
renewals
or
replacements
of
or
repairs
to
or
for
use
in
substitution
for
materials,
articles
or
things
imported
free
of
duty
(including
materials,
articles
and
things
required
for
or
in
connection
with
carrying
out
or
effecting
such
renewals,
replacements,
repairs
or
substitution)
the
Company
shall
pay
such
import
duties
and
taxes
of
general
application
(if
any)
as
shall
be
in
force
from
time
to
time
under
the
general
laws
of
Newfoundland
provided
that
until
the
2nd
day
of
August,
1967,
such
import
duties
and
taxes
taken
together
shall
not
exceed
25
per
centum
of
the
value
of
the
material,
article
or
thing
in
question.
(1927
Agreement,
el.
2,
para.
(f),
Case
p.
61,
1.
35
as
amended
by
1938
Agreement,
cl.
27,
Case
p.
100,
1.
14.)
(g)
Provided
that
no
exemption
in
or
to
which
are
applicable
the
provisions
of
the
foregoing
sub-clauses
(d),
(e)
and
(f)
shall
apply
to,
and
the
Company
shall
pay
such
import
duties
and
taxes
of
general
application
(if
any)
as
shall
be
in
force
from
time
to
time
under
the
general
laws
of
the
Colony
on,
the
following
:
(1)
Food,
clothing,
dry
goods
and
hand-tools;
(2)
Moveable
articles
of
household
and
office
furniture
and
equipment
and
camp
utensils,
including
stoves
other
than
furnaces;
(3)
Articles
and
goods
intended
by
the
importer
for
the
personal
and
private
ownership
of
individuals;
(4)
Lumber
of
sizes
and
qualities
manufactured
in
Newfoundland
from
timber
grown
in
Newfoundland,
if
such
lumber
can
be
obtained
in
Newfoundland
as
and
when
and
of
sizes
and
qualities
required
by
the
Company
from
time
to
time;
and
(5)
Windows
and
doors,
and
casings
therefor,
sashes,
mouldings,
mantels,
stairs,
cupboards,
ships,
boats
and
barges
made
or
constructed
mainly
or
entirely
of
wood,
of
kinds,
qualities
and
sizes
manufactured
in
Newfoundland
from
timber
grown
in
Newfoundland,
if
such
windows
and
doors,
and
casings
therefor,
sashes,
mouldings,
mantels,
stairs,
cupboards,
ships,
boats
and
barges
can
be
obtained
in
Newfoundland
as
and
when
and
of
qualities
and
dimensions
required
by
the
Company
from
time
to
time.
(6)
Bricks,
nails,
and
paints
for
use
in
town
construction,
of
sizes
and
kinds
manufactured
in
Newfoundland,
if
such
bricks,
nails
and
paints
can
be
obtained
in
Newfoundland
as
and
when
and
of
the
sizes
and
kinds
required
by
the
Company
from
time
to
time.
(7)
Ropes
and
twines
and
nets
of
kinds
and
sizes
manufactured
in
Newfoundland.
(1927
Agreement,
el.
2,
para,
(g),
Case
p.
62,
1.
6
as
amended
by
1927
Act,
s.
8,
Case
p.
57,
1.
15,
and
1938
Agreement,
el.
28,
Case
p.
100,
1.
30.)
(ga)
Baling
wire,
metal
core
caps,
metal
seals,
metal
strips
and
laminated
heads
to
be
used
in
binding
or
packing
goods,
sulphur,
adhesives,
silicate
of
soda,
hessian,
cores
made
of
paper
or
other
material,
chlorine
for
industrial
purposes
shall
be
admitted
free
of
taxes
and
duties.
(gb)
The
following
materials
if
imported
for
use
as
bleaching
materials
or
in
connection
with
bleaching
shall
be
admitted
free
of
taxes
and
duties,
namely,
caustic
soda,
bleaching
powder
(calcium
hypochlorite),
chlorine,
sodium
thiosulphate,
potassium
permanganate,
sulphuric
acid
and
hydrochloric
acid
and
such
other
bleaching
materials
as
the
Company
may
from
time
to
time
show
to
the
satisfaction
of
the
Government
are
to
be
used
in
the
manufacture
of
bleached
pulp.
(1938
Agreement,
el.
29,
Case
p.
100,
1.
34.)
(h)
On
all
goods,
materials
and
articles,
other
than
those
specified
in
or
to
which
are
applicable
the
provisions
of
the
foregoing
subclauses
(d)
to
(gb)
imported
into
the
Colony
and
for
use
by
the
Company
in
its
business
of
manufacturing
pulp
or
paper
or
operations
incidental
thereto,
or
its
business
of
generating
or
transmitting
electrical
power
or
energy
(1)
the
Company
shall,
for
a
period
of
twenty
years
from
the
date
hereof,
pay
import
duties
and
taxes
of
general
application
(if
any)
in
force
from
time
to
time
under
the
general
laws
of
the
Colony,
provided
that,
in
cases
where
under
the
general
laws
of
the
Colony
now
in
force
a
duty
or
tax
is
payable,
the
Company
shall
not
pay
duties
or
taxes
in
excess
of
those
so
payable
under
the
general
laws
now
in
force,
and
in
cases
where
under
the
general
laws
of
the
Colony
now
in
force
no
duty
or
tax
is
payable,
the
Company
shall
not
pay
duties
or
taxes,
and
provided
further
than
on
kerosene
and
gasolene
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
the
aggregate
be
in
excess
of
five
cents
a
gallon
and
on
coal
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
the
aggregate
be
in
excess
of
fifty
cents
a
ton
and
on
crude
petroleum
and
fuel
oil
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
the
aggregate
be
in
excess
of
such
per
cent
of
the
value
thereof
as
fifty
cents
per
ton
bears
to
the
delivered
price
at
the
mills
of
the
Company
in
Newfoundland
of
coal
of
the
quality
and
from
the
source
ordinarily
used
in
such
mills;
and
(2)
the
Company
shall,
for
a
further
period
of
twenty
(20)
years,
pay
import
duties
and
taxes
of
general
application
(if
any)
in
force
from
time
to
time
under
the
general
laws
of
the
Colony,
provided
that
in
cases
where
under
the
general
laws
of
the
Colony
now
in
foree
a
duty
or
tax
is
payable
the
Company
shall
not
pay
duties
and
taxes
aggregating
more
than
the
sum
of
(i)
those
so
payable
under
the
general
laws
now
in
force,
and
(ii)
ten
per
cent
of
the
value
of
the
goods,
materials
or
articles
in
question,
and
in
cases
where
under
the
general
laws
of
the
Colony
now
in
force
no
duty
or
tax
is
now
payable,
the
Company
shall
not
pay
duties
and
taxes
aggregating
more
than
ten
per
cent
of
the
value
of
the
goods,
materials
or
articles
in
question,
and
provided
further
that
on
kerosene
and
gasolene
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
aggregate
be
in
excess
of
five
cents
a
gallon
plus
ten
per
cent
of
the
value
thereof
and
on
coal
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
the
aggregate
be
in
excess
of
fifty
cents
a
ton
plus
ten
per
cent
of
the
value
thereof
and
on
crude
petroleum
and
fuel
oil
such
import
duties
and
taxes
of
general
application
payable
by
the
Company
shall
not
in
the
aggregate
be
in
excess
of
such
per
cent
of
the
value
thereof
as
fifty
cents
per
ton
plus
ten
per
cent
of
the
value
thereof
bears
to
the
delivered
price
at
the
mills
of
the
Company
in
Newfoundland
of
coal
of
the
quality
and
from
the
source
ordinarily
used
in
such
mills.
(1927
Agree-
ment,
cl.
2(h),
Case
p.
62.
1.
32,
as
amended
by
1938
Agreement,
el.
29(2)
and
(3),
Case
p.
101,
1.
13.)
(i)
Wherever
under
any
provision
of
the
foregoing
subelauses
of
this
Clause
2,
and
for
the
period
that,
any
goods,
materials
or
articles
are
exempt
from
import
duties
or
taxes
and
are
imported
into
the
Colony
in
containers
or
wrappings,
such
containers
or
wrappings
shall
be
admitted
free
of
duties
and
taxes;
and
wherever
under
any
provision
of
the
foregoing
sub-clauses
of
this
Clause
2,
and
for
the
period
that,
any
goods,
materials
or
articles
are
subject
to
limited
duties
or
taxes
and
are
imported
into
the
Colony
in
containers
or
wrappings,
such
containers
and
wrappings
shall
be
subject
to
import
duties
and
taxes
of
general
application
aggregating
not
more
than
such
per
cent
of
the
value
thereof
as
the
aggregate
of
the
duties
and
taxes
on
the
goods,
materials
or
articles
in
such
containers
or
wrappings
bears
to
the
value
of
such
goods,
materials,
or
articles.
(3)
Wherever
the
Company
shall
have
imported
any
article
or
goods
free
of
duties
or
taxes
or
subject
to
limited
duties
or
taxes
under
the
provisions
of
this
Clause
2
and
shall
sell,
give
or
otherwise
transfer
the
same
to
any
person
or
corporation
not
entitled
to
import
such
article
or
goods
free
of
duty
or
taxes
or
subject
to
such
limited
duties
or
taxes,
it
shall
be
the
duty
of
the
vendor,
donor
or
transferor
to
notify
the
Customs
Department
forthwith
of
such
sale,
gift
or
transfer,
and
to
pay
such
duties
and
taxes,
if
any,
as
shall
be
necessary,
in
addition
to
any
duties
and
taxes
already
paid
thereon,
to
make
up
the
full
amount
of
the
import
duties
and
taxes,
if
any,
which
would
be
payable
on
such
article
or
goods
by
such
vendee,
donee
or
transferee
under
the
Customs
Act
and
Tariff
in
force
at
the
time
of
such
sale,
gift
or
transfer,
upon
the
basis
of
the
value
for
duty
of
such
article
or
goods
at
that
time.
(k)
The
Company
shall
be
deemed
to
have
guaranteed
payment
of
duty
to
the
Government
in
the
cases
in
the
foregoing
sub-clause
(j)
provided
for,
and
shall
be
secondarily
liable
for
such
duties
and
shall
pay
the
same
if
the
Minister
of
Finance
and
Customs
shall
have
been
unable
to
collect
the
same
from
the
person
or
corporation
primarily
liable.
(1)
The
expression
"Company’’
wherever
used
in
the
foregoing
sub-clauses
(b)
to
(k),
inclusive,
or
in
the
Sections
of
the
Act
of
1923
or
Clauses
of
the
Agreement
of
1923
to
which
the
foregoing
sub-clauses
(c)
and
(e)
apply,
shall
include
the
Company’s
subsidiary
companies
engaged
in
the
business
of
generating
or
transmitting
electrical
power
or
energy
or
of
manufacturing
pulp
or
paper
or
operations
incidental
thereto
or
in
any
business
of
the
nature
to
which
the
provisions
of
the
foregoing
sub-clause
(e)
apply;
the
expression
‘‘import
duties
and
taxes
of
general
application’’
wherever
used
in
the
foregoing
sub-
clauses
(f),
(g),
(h)
and
(i)
shall
mean
import
duties
and
taxes
(including
sales
taxes
on
imports)
applicable
to
all
importers
into
the
Colony
of
the
goods,
materials
or
articles
in
question,
provided
that
the
existence
of
special
reductions,
exemptions
or
rebates
lawfully
created
in
favour
of
fishermen
shall
not
of
itself
prevent
a
duty
or
tax
from
being
deemed
of
general
application
;
the
expression
"‘now
in
foree’’
wherever
used
in
the
foregoing
sub-clause
(h)
shall
mean
in
force
prior
to
the
present
session
of
the
Legislature;
and
the
expression
‘‘value’’,
wherever
used
in
the
foregoing
sub-clauses
(f),
(h)
and
(1)
shall
mean
the
current
domestic
value
of
the
article
or
material
in
question
in
the
principal
markets
of
the
country
whence
and
at
the
time
when
the
same
was
exported
directly
to
this
Colony.
(1927
Agreement,
cl.
2(1),
(j),
(k)
and
(1),
Case
p.
64,
1.
8.).
In
addition
to
amending
the
provisions
of
the
1927
Agreement,
the
1988
Agreement
added
the
following
new
provisions
:
24.
All
property
of
the
Company
within
the
area
of
any
towns
or
settlements
established
by
the
Company
shall
be
exempt
from
municipal
taxation.
(Case
p.
99,
1.
14).
26.
If
within
five
years
from
the
completion
respectively
of
the
extensions
referred
to
in
Clause
2
of
this
Agreement
or
the
increase
referred
to
in
Clause
3
of
this
Agreement
the
Company
wishes
to
instal
any
plant
of
a
type
contemplated
in
the
original
design
of
such
extensions
or
increase
as
the
case
may
be
which
the
Company
was
unable
to
instal
at
the
time
of
the
original
construction
for
reasons
beyond
its
control,
such
plant
shall
be
treated
as
part
of
the
original
installation
and
be
admitted
free
under
Clause
2(d)
of
the
Agreement
of
1927
as
amended
by
Clause
25
of
this
Agreement.
(Case
p.
100,
1.
3).
30.
Notwithstanding
the
provisions
of
Clause
2(h)
of
the
Agreement
of
1927
the
Company
shall
be
entitled
to
import
coal
for
the
operation
of
the
extensions
to
its
sulphite
plant
and
the
increase
in
the
paper
capacity
of
its
mills
hereinbefore
referred
to
free
of
duties
and
taxes.
For
the
purpose
of
giving
effect
to
this
provision
it
shall
be
assumed
(a)
that
the
coal
consumed
by
the
Company
in
its
Corner
Brook
mills
in
each
year
up
to
but
not
exceeding
20,000
tons
is
coal
imported
otherwise
than
for
such
operation
as
aforesaid
and
the
same
shall
accordingly
be
liable
to
payment
of
duty
under
Clause
2(h)
of
the
Agreement
of
1927
and
(b)
that
the
coal
consumed
by
the
Company
as
aforesaid
in
each
year
in
excess
of
20,000
tons
is
coal
imported
for
such
operations
as
aforesaid
and
the
same
shall
accordingly
be
free
of
duties
and
taxes.
31.
Save
as
mentioned
in
the
foregoing
clauses
of
this
Agreement
no
unmanufactured
timber
exported
by
the
Company
under
this
Agreement
shall
be
subject
to
the
payment
of
any
tax,
duty
or
charge.
32.
The
Government
agrees
that
it
will
not
impose
on
the
Company
nor
shall
the
Company
be
liable
to
pay
at
any
time
hereafter
any
taxes,
duties
or
charges
of
a
special
or
discriminatory
nature.
(Case
p.
101,
1.
20).
The
Act
of
1927
relating
to
the
1927
Agreement
provided
as
follows:
1.
The
Agreement
made
between
His
Excellency
Sir
William
Lamond
Allardyce,
G.C.M.G.,
Governor
of
Newfoundland
and
its
Dependencies,
in
Council,
of
the
one
part,
and
International
Paper
Company
of
Newfoundland,
Limited,
of
the
other
part,
dated
the
2nd
day
of
August,
A.D.,
1927,
and
forming
the
Schedule
of
this
Act,
is
hereby
approved,
confirmed
and
adopted,
and
all
and
singular
the
several
clauses
and
provisions
thereof
are
hereby
declared
to
be
valid
and
binding
upon
the
said
parties
thereto
and
each
of
them
respectively,
and
to
have
the
force
and
effect
of
law,
and
all
and
singular
the
several
acts,
matters
and
things
therein
provided
to
be
done
or
performed
by
or
on
the
part
of
the
parties
respectively
are
hereby
declared
to
be
proper
and
lawful,
and
the
parties
and
each
of
them
shall
have
full
power
and
authority
from
time
to
time
to
do
and
perform
or
omit
to
do
and
perform
all
and
singular
the
several
acts,
matters
and
things
in
and
by
the
said
Agreement
provided
to
be
done
or
not
to
be
done,
as
the
case
may
be,
in
the
manner
and
with
the
effect
and
under
the
conditions
stipulated
and
provided
in
the
said
Agreement.
(Case
p.
55,
1.
17).
The
remaining
provisions
amended
various
provisions
of
the
Agreement
or
dealt
with
related
matters.
(Case
pp.
56-7).
The
Act
of
1938
relating
to
the
1938
Agreement
provides
as
follows:
1.
The
Agreement
made
between
His
Excellency
Sir
Humphrey
Thomas
Walwyn,
K.C.S.I.,
C.B.,
D.S.O.,
Governor
of
Newfoundland
and
its
Dependencies
in
Commission
of
the
one
part
and
Bowater’s
Newfoundland
Pulp
and
Paper
Mills
Limited,
a
Company
incorporated
under
the
laws
of
Newfoundland
and
having
its
registered
office
at
Corner
Brook
in
the
Island
of
Newfoundland
of
the
other
part,
dated
the
29th
day
of
November,
A.D.
1938,
and
forming
the
Schedule
of
this
Act
is
hereby
approved
and
confirmed
and
declared
to
be
valid
and
binding
upon
the
parties
thereto.
‘2.
In
Clause
5
of
the
Agreement
forming
the
Schedule
to
this
Act
there
shall
be
inserted
after
the
words
"‘riots
or
civil
commotions’’
the
words
"‘or
by
adverse
commercial
or
economic
conditions
existing
in
any
season
or
seasons
which
the
Company
shall
show
to
the
satisfaction
of
the
Government
make
it
reasonable
for
the
Company
not
to
comply
with
such
obligations
in
whole
or
in
part’’
and
the
figures
and
words
4
‘25
cents’’
shall
be
struck
out
and
the
words
‘‘two
dollars”
substituted
therefor.
3.
Subject
to
the
amendments
above
set
forth,
all
and
singular
the
several
clauses
and
provisions
of
the
said
Agreement
set
forth
in
the
Schedule
hereto
are
hereby
declared
to
have
the
force
and
effect
of
law
for
all
purposes
as
if
expressly
enacted
herein.
4.
Subject
to
the
amendments
above
set
forth,
the
parties
and
each
of
them
shall
have
full
power
and
authority
from
time
to
time
to
do
and
perform
or
omit
to
do
and
perform
all
and
singular
the
several
acts,
matters,
things
and
agreements
in
and
by
the
said
Schedule
provided
to
be
done
or
not
to
be
done,
as
the
case
may
be,
in
the
manner
and
with
the
effect
and
under
the
conditions
stipulated
and
provided
in
the
said
Schedule.
(Case
p.
84).
Sections
49
and
50
of
An
Act
to
Amend
The
Income
Tax
Act
and
the
Income
War
Tax
Act,
Ch.
25,
Statutes
of
Canada,
1949
(Second
Session),
provide
as
follows:
49.
For
greater
certainty
it
is
hereby
declared
and
enacted
that,
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-nine),
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada.
50.
Notwithstanding
anything
contained
in
this
or
any
other
Act
an
exemption
from
taxation
provided
for
in
an
international
treaty
or
international
agreement
binding
on
Newfoundland
before
the
union
of
Newfoundland
with
Canada
may
be
extended
by
regulation
of
the
Governor
in
Council
to
taxation
by
or
under
any
Act
of
the
Parliament
of
Canada.
The
Attorney-General
of
Canada
submits
that
the
answer
to
each
of
the
three
questions
referred
to
the
Court
should
be
in
the
negative
because:
(1)
The
statutes
referred
to
in
the
questions
ceased
to
operate
at
the
time
of
the
Union
of
Newfoundland
with
Canada;
(2)
Even
if
these
statutes
continued
in
operation
after
the
Union
they
do
not
apply
in
respect
of
Acts
of
the
Parliament
of
Canada
extended
to
Newfoundland
pursuant
to
the
Union
to
confer
any
deduction,
exemption,
immunity
or
privilege
in
respect
of
a
duty,
tax,
obligation
or
requirement
imposed
thereunder
;
(3)
Even
if
these
statutes
continued
in
operation
and
any
of
the
provisions
thereof
apply
in
respect
of
Acts
of
the
Parliament
of
Canada
to
confer
any
deductions,
exemption,
immunity
or
privilege
in
respect
of
a
duty,
tax,
obligation
or
requirement
under
an
Act
of
the
Parliament
of
Canada,
they
have
been
overriden
by
section
49
of
the
Act
to
Amend
The
Income
Tax
Act
and
the
Income
War
Tax
Act
(Ch.
25,
Statutes
of
Canada,
1949—Second
Session),
which
is
validly
enacted
by
Parliament
within
its
authority
under
the
British
North
America
Acts,
1867-1949.
The
Terms
of
Union
of
Newfoundland
with
Canada
approved
and
given
force
of
law
by
the
British
North
America
Act,
1949,
are
Terms
3
and
18:
3.
The
British
North
America
Acts,
1867
to
1946,
shall
apply
to
the
Province
of
Newfoundland
in
the
same
way,
and
‘to
the
like
extent
as
they
apply
to
the
provinces
heretofore
comprised
in
Canada,
as
if
the
Province
of
Newfoundland
had
been
one
of
the
provinces
originally
united,
except
in
so
far
as
varied
by
these
Terms
and
except
such
provisions
as
are
in
terms
made
or
by
reasonable
intendment
may
be
held
to
be
specially
applicable
to
or
only
to
affect
one
or
more
and
not
all
of
the
provinces
originally
united.
18.
(1)
Subject
to
these
Terms,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
shall
continue
therein
as
if
the
Union
had
not
been
made,
subject
nevertheless
to
be
repealed,
abolished,
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946,
and
all
orders,
rules,
and
regulations
made
under
any
such
laws
shall
likewise
continue,
subject
to
be
revoked
or
amended
by
the
body
or
person
that
made
such
orders,
rules
or
regulations
or
the
body
or
person
that
has
power
to
make
such
orders,
rules,
or
regulations
after
the
date
of
Union,
according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946.
(2)
Statutes
of
the
Parliament
of
Canada
in
force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
Province
of
Newfoundland
on
a
day
or
days
to
be
fixed
by
Act
of
the
Parliament
of
Canada
or
by
proclamation
of
the
Governor-General
in
Council
issued
from
time
to
time,
and
any
such
proclamation
may
provide
for
the
repeal
of
any
of
the
laws
of
Newfoundland
that
(a)
are
of
general
application
;
(b)
relate
to
the
same
subject-matter
as
the
statute
or
part
thereof
so
proclaimed;
and
(c)
could
be
repealed
by
the
Parliament
of
Canada
under
paragraph
one
of
this
Term.
(3)
Notwithstanding
anything
in
these
Terms
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.
(4)
Except
as
otherwise
provided
by
these
Terms
all
courts
of
civil
and
criminal
jurisdiction
and
all
legal
commissions,
powers,
authorities,
and
functions,
and
all
officers
and
functionaries,
judicial,
administrative,
and
ministerial,
existing
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union,
shall
continue
in
the
Province
of
Newfoundland
as
if
the
Union
had
not
been
made,
until
altered,
abolished,
revoked,
terminated,
or
dismissed
by
the
appropriate
authority
under
the
British
North
America
Acts,
1867
to
1946.
The
effect
of
Terms
3
and
18
of
the
Terms
of
Union
of
Newfoundland
is
first
that
the
British
North
America
Acts,
1867
to
1946,
will
apply
to
the
Province
of
Newfoundland
in
the
same
way
and
to
the
like
extent
as
they
apply
to
the
provinces
heretofore
comprised
in
Canada,
as
if
the
Province
of
Newfoundland
had
been
one
of
the
provinces
originally
united.
The
only
exceptions
are
if
they
are
varied
by
the
Terms,
or
if
they
are
in
the
provisions
which
may
be
held
to
be
specially
applicable
to
or
only
to
affect
one
or
more
and
not
all
of
the
provinces
originally
united.
Furthermore,
subject
to
the
Terms
of
Union
of
Newfoundland
with
Canada,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
continued
therein
"‘as
if
the
Union
had
not
been
made’’.
Those
laws,
nevertheless,
may
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946.
In
addition,
all
orders,
rules
and
regulations
made
under
any
such
laws
continued,
subject
to
be
revoked
or
amended
by
the
body
or
person
that
made
such
orders,
rules
or
regulations,
or
the
body
or
person
that
has
power
to
make
such
orders,
rules
or
regulations
after
the
date
of
Union
according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946.
In
my
opinion,
the
"‘authority’’
referred
to
in
Term
18(1)
is
the
authority
which
is
given
jurisdiction
on
the
respective
subject-matters
enumerated
in
Sections
91
and
92
of
the
British
North
America
Act,
that
is
to
say,
that
by
force
of
Term
18(1)
the
Parliament
of
Canada
is
thereby
given
the
authority
to
repeal,
abolish
or
alter
any
and
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union,
which
deal
with
the
subject-matters
in
Section
91,
and
the
Legislature
of
the
Province
of
Newfoundland
is
given
authority
to
repeal,
abolish
or
alter
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
which
deal
with
the
subject-
matters
in
Section
92
of
the
Act.
That
proposition
is
further
supported
by
Subsection
(2)
of
Term
18,
which
gives
to
the
Parliament
of
Canada
power
to
put
in
force,
either
by
Act
of
the
Parliament
or
by
proclamation
of
the
Governor
General
in
Council,
all
Statutes
of
Canada
in
force
at
the
date
of
Union
which
are
of
general
application,
or
which
relate
to
the
same
subject-matter
as
the
Statute
or
part
thereof
so
proclaimed,
and
which
could
be
repealed
by
the
Parliament
of
Canada
under
Paragraph
1
of
Term
18.
Likewise
Subsection
(2)
authorizes
the
Parliament
of
Canada
to
repeal
any
of
the
laws
of
Newfoundland
thus
mentioned
in
that
subsection.
It
is
to
be
noted
that
Subsection
(1)
of
Term
18
is
slightly
different,
for
example,
from
the
corresponding
terms
in
the
Acts
of
Union
with
Alberta
and
Saskatchewan.
It
is
said
here
that
the
laws
of
Newfoundland
shall
remain
in
foree
"‘as
if
the
Union
had
not
been
made”
which
means,
to
my
mind,
that
notwithstanding
that
these
laws
may
be
dealing
with
subject-matters
rightly
coming
under
the
jurisdiction
of
the
Parliament
of
Canada
under
Section
91
of
the
British
North
America
Act,
they
might
nevertheless
not
cease
to
operate
immediately
upon
the
date
of
the
Union
until
they
are
repealed,
abolished
or
altered
by
the
Parliament
of
Canada.
But
I
do
not
think
that
we
need
consider
that
possible
interpretation
for
the
purpose
of
answering
the
three
questions
submitted
to
the
Court
and
which
refer
only
to
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited.
I
wish,
therefore,
to
make
it
well
understood
that
any
general
proposition
laid
down
in
the
present
opinion
is
strictly
limited
to
that
company
and
to
the
questions
as
they
are
submitted.
In
this
case,
the
Parliament
of
Canada
by
Section
49
of
An
Act
to
Amend
The
Income
Tax
Act
and
the
Income
War
Tax
Act,
assented
to
10th
December,
1949,
has
legislated
that,
""
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-nine),
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada’’.
The
legislation
contained
in
Section
49
clearly
relates,
in
fact
and
specific
terms,
to
the
Statutes
of
Newfoundland
whereby
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
is
entitled
to
deductions,
exemptions,
immunities
or
privileges
in
respect
of
any
duty
or
tax
and
of
any
obligation;
and
also
to
exemptions
or
immunities
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods.
It
follows
that
by
force
of
Subsection
2(b)
of
Term
18
these
matters
relate
to
the
same
subject-matter
as
the
Statute
or
part
thereof
so
proclaimed
by
Canada
and,
therefore,
that
pro
tanto
Section
49
of
the
Income
Tax
Act
and
Income
War
Tax
Act
(Chap.
25,
8.C.
13
George
VI)
repeals
the
laws
of
Newfoundland
granting
these
deductions,
exemptions
or
immunities
and
privileges
to
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited.
It
clearly
and
undoubtedly
has
that
effect
and
it
must
be
so
held
unless
it
could
be
successfully
contended
that
the
legislation
of
Parliament
is
unauthorized
by
the
Terms
of
Union
and,
accordingly,
ultra
vires.
I
am
of
the
opinion
that
Section
49
was
competently
enacted
both
under
Subsection
(2)
and
Subsection
(1)
of
Term
18.
The
argument
of
counsel
for
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
was
that
the
laws
and
agreements
invoked
by
that
company
were
to
be
looked
upon
as
a
single
indivisible
whole
and
not
severable,
and
that
Subsection
(3)
of
Terms
18,
which
reads:
‘
‘
(3)
Notwithstanding
anything
in
these
Terms
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union’’
therefore
applies.
They
say
it
follows
that
the
statutes
and
agreements
whereby
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
was
granted
its
exemptions,
immunities
and
privileges
could
not
be
done
away
with
or
altered
except
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland.
I
cannot
agree.
Subsection
(3)
is
limited
to
"‘repeal''
and
I
would
go
as
far
as
saying
that
that
subsection
may
be
used
by
the
Parliament
of
Canada
and
the
Legislature
of
the
Province
to
authorize
the
repeal
of
a
law
in
force
in
Newfoundland
at
the
date
of
Union
even
if
it
relates
to
a
subject-matter
under
Section
92
of
the
British
North
America
Act.
Interpreting
it
as
meaning
that
no
laws
of
Newfoundland
can
be
repealed,
except
with
the
consent
of
the
Legislature
of
that
Province,
would
lead
to
an
absurdity.
It
is
only
necessary
to
mention
that
the
statutes
and
agreements
concerning
Newfoundland
grant
immunities
from
customs
and
excise
duties
to
show
that
any
such
intention
can
never
have
entered
into
the
minds
of
the
drafters
of
the
Terms
of
Union,
for
customs
and
excise
duties
clearly
belong
to
Parliament
under
Section
91
of
the
British
North
America
Act,
and,
if
we
suppose
that
Newfoundland
would
refuse
its
consent
to
the
repeal
of
at
least
that
part
of
the
statutes
and
agreements
with
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
the
customs
and
excise
duties
owed
by
the
latter
would
forever
remain
under
the
jurisdiction
of
Newfoundland;
the
Parliament
of
Canada
would
be
helpless
to
remedy
that
situation
and
as
the
whole
organization
of
customs
and
excise
duties
administration
is
with
the
Parliament
of
Canada,
the
whole
matter
would
become
unworkable.
Nor
do
I
think
that
the
principle
or
severability,
as
it
is
expounded
in
several
decisions
of
this
Court
and
of
the
Judicial
Committee
of
the
Privy
Council,
applies
in
the
premises.
It
has
come
into
play
when
the
Courts
had
to
examine
the
validity
of
legislation
emanating
from
one
Parliament
or
Legislature,
but
never
in
a
case
like
the
present
one,
when
we
are
discussing
the
respective
authority
of
Parliament
of
the
one
part
and
the
Legislatures
of
the
other
part.
Above
all,
I
am
of
the
opinion
that
Subsection
(1)
of
Term
18
was
made
precisely
to
cover
the
severability
resulting
from
the
Union.
By
force
of
that
subsection,
Parliament
was
recognized
as
the
true
authority
henceforth
to
repeal,
abolish
or
alter
the
laws,
orders,
rules
or
regulations
having
as
subject-matters
those
which
are
enumerated
in
Section
91
of
the
British
North
America
Act;
and
the
Legislature
of
Newfoundland,
on
the
other
hand,
was
given
the
authority
to
repeal,
abolish
or
alter
the
laws,
orders,
rules
or
regulations
which
deal
with
the
subjectmatters
enumerated
in
Section
92
of
the
British
North
America
Act.
It
could
not
be
otherwise,
and,
if
it
had
not
been
so,
the
Terms
of
Union
could
never
have
functioned.
So
that
the
argument
of
indivisibility
or
sever
ability
not
only
cannot
apply
in
the
operation
of
the
Terms
of
Union
but
it
is
specifically
provided
for
in
Subsection
(1)
of
Term
18.
As
a
consequence
of
that
subsection,
upon
the
Union
being
consummated,
all
subject-matters
under
Section
91
came
under
the
jurisdiction
of
the
Parliament
of
Canada
and
the
subjectmatters
under
Section
92
remained
under
the
jurisdiction
of
the
Province
of
Newfoundland
‘‘according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946’’.
It
seems
to
me,
therefore,
abundantly
clear
that,
upon
the
Union
taking
place,
customs
and
excise
duties
being
properly
in
the
domain
of
the
Parliament
of
Canada,
that
Parliament
became
the
only
competent
body
to
legislate
in
regard
to
them
throughout
Canada,
including
Newfoundland.
As
said
before,
I
do
not
think
that
the
questions
call
upon
the
Court
to
say
what
happens
in
that
respect
during
the
period
extending
from
the
date
of
the
Union
to
the
date
when
legislation
from
the
Parliament
of
Canada
is
made
to
come
into
force
either
for
the
purpose
of
repealing,
abolishing
or
altering.
As
for
taxes,
and
amongst
them,
income
taxes
or
income
war
taxes,
the
situation
is
somewhat
different
for
both
the
Parliament
and
the
Legislatures
have
been
given
the
power
to
tax.
I
would
not
doubt
that
the
exemptions
in
respect
of
taxes
remain
in
force
for
the
benefit
of
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
in
so
far
as
they
apply
to
provincial
taxes
:
but
these
exemptions,
if
sought
to
be
invoked
as
against
federal
taxes,
can,
of
course,
have
no
effect
and
they
become
inoperative.
Under
no
rule
of
interpretation
can
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
be
regarded
as
having
been
given
an
exemption
or
an
immunity
from
the
taxes
imposed
by
the
Parliament
of
Canada.
In
that
sense
they
are
in
no
different
situation
from
any
other
company
in
any
other
province
of
Canada.
The
British
North
America
Act
authorizes
double
taxation
within
the
limits
therein
stated
and
enumerable
examples
could
be
given
of
companies
enjoying
exemption
and
immunity
from
provincial
taxes
and
which,
of
course,
does
not
carry
exemption
and
immunity
from
federal
taxes.
In
the
present
case,
the
imposition
of
federal
taxes
is
only
the
imposition
of
an
additional
tax
upon
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited—a
situation
against
which,
of
course,
the
former
Colony
of
Newfoundland
can
never
protect
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited.
Section
49
does
not
divest
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
of
its
immunities,
exemptions
or
privileges
in
respect
of
taxes
within
the
territory
of
Newfoundland.
It
says
merely
that
the
exemptions,
immunities
and
privileges
granted
by
Newfoundland
do
not
apply
with
respect
to
federal
taxes.
Having
come
to
those
conclusions,
the
answers
to
the
questions
referred
to
the
Court
must
be
in
the
negative.
To
Question
No.
1,
I
answer
no;
To
Question
No.
2,
I
answer
no;
To
Question
No.
3,
I
answer
no,
since
export
or
import
of
goods
are
exclusively
of
the
competency
of
the
Parliament
of
Canada.
I
hereby
certify
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
KERWIN,
J.:—Under
section
55
of
the
Supreme
Court
Act
the
Governor
in
Council
referred
to
this
Court
for
hearing
and
consideration
the
following
questions
:—
"‘1.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemptions
or
immunity
from,
or
any
privilege
in
respect
of
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada
?
2.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemption
of
immunity
from,
or
any
privilege
in
respect
of
any
obligation
under
any
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax?
3.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
license,
permit
or
certificate
for
the
export
of
import
of
goods?”
(Here
follows
a
list
of
the
statutes
referred
to
in
the
questions).
No
question
is
raised
as
to
the
validity
or
effect
of
these
statutes
before
the
Union
of
Newfoundland
with
Canada.
Newfoundland
became
part
of
Canada
as
a
province
thereof
on,
from,
and
after
the
coming
into
force
of
the
Terms
of
Union
between
the
two
countries,
which
were
agreed
to
between
representatives
of
both
and
were
approved
by
the
Government
of
Newfoundland,
and,
by
chapter
1
of
the
Statutes
of
1949
of
Canada,
by
the
Canadian
Parliament,
assented
to
February
18th,
1949.
As
the
British
North
America
Act,
1949
(Imperial),
confirmed
the
Terms
of
Union
and
enacted
that
they
should
have
the
force
of
law
notwithstanding
anything
in
the
British
North
America
Acts,
1867
to
1946,
the
Terms,
by
virtue
of
number
50,
came
into
force
immediately
before
the
expiration
of
March
31st,
1949.
All
of
the
Newfoundland
statutes
listed
were
enacted
before
the
Union
of
Newfoundland
with
Canada
by
the
Governor,
Legislative
Council
and
House
of
Assembly
of
Newfoundland
or
by
the
Governor
by
and
with
the
advice
of
the
Commission
of
Government.
Newfoundland
had
a
Constitution
until
it
was
suspended
by
the
Commission
of
Government
referred
to,
as
of
February
16th,
1934,
and
by
Term
7
of
the
Terms
of
Union
that
Constitution
as
it
existed
immediately
prior
to
that
date
"is
revived
at
the
date
of
Union
and
shall,
subject
to
these
Terms
and
the
British
North
America
Acts,
1867
to
1946,
continue
as
the
Constitution
of
the
Province
of
Newfoundland
from
and
after
the
date
of
Union,
until
altered
under
the
authority
of
the
said
Acts.”
By
Term
3
:—
"3.
The
British
North
America
Acts,
1867
to
1946,
shall
apply
to
the
Province
of
Newfoundland
in
the
same
way,
and
to
the
like
extent
as
they
apply
to
the
provinces
heretofore
comprised
in
Canada,
as
if
the
Province
of
Newfoundland
had
been
one
of
the
provinces
originally
united,
except
in
so
far
as
varied
by
these
Terms
and
except
such
provisions
as
are
in
terms
made
or
by
reasonable
intendment
may
be
held
to
be
specifically
applicable
to
or
only
to
affect
one
or
more
and
not
all
of
the
provinces
originally
united.’’
By
other
Terms
of
Union
provision
is
made
for
the
executive
and
legislature
and
such
special
matters
as
education,
patents,
trade
marks
and
fisheries
but
the
important
Term
is
18,
the
four
paragraphs
of
which
read
as
follows
:—
4
‘
18.
(1)
Subject
to
these
Terms,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
shall
continue
therein
as
if
the
Union
had
not
been
made,
subject,
nevertheless,
to
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946,
and
all
orders,
rules,
and
regulations
made
under
any
such
laws
shall
likewise
continue,
subject
to
be
revoked
or
amended
by
the
body
or
person
that
made
such
orders,
rules,
or
regulations
or
the
body
or
person
that
has
power
to
make
such
orders,
rules,
or
regulations
after
the
date
of
Union,
according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946.
(2)
Statutes
of
the
Parliament
of
Canada
in
Force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
Province
of
Newfoundland
on
a
day
or
days
to
be
fixed
by
Act
of
the
Parliament
of
Canada
or
by
proclamation
of
the
Governor
General
in
Council
issued
from
time
to
time,
and
any
such
proclamation
may
provide
for
the
repeal
of
any
of
the
laws
of
Newfoundland
that
(a)
are
of
general
application
;
(b)
relate
to
the
same
subject-matter
as
the
statute
or
part
thereof
so
proclaimed;
and
(e)
could
be
repealed
by
the
Parliament
of
Canada
under
paragraph
one
of
this
Term.
(3)
Notwithstanding
anything
in
these
Terms,
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.
(4)
Except
as
otherwise
provided
by
these
Terms,
all
courts
of
civil
and
criminal
jurisdiction,
and
all
legal
commissions,
powers,
authorities
and
functions,
and
all
officers
and
functionaries,
judicial,
administrative,
and
ministerial,
existing
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union,
shall
continue
in
the
Province
of
Newfoundland
as
if
the
Union
had
not
been
made,
until
altered,
abolished,
revoked,
terminated,
or
dismissed
by
the
appropriate
authority
under
the
British
North
America
Acts,
1867
to
1946.^
In
pursuance
of
paragraph
(2)
of
this
Term
the
Governor
General
in
Council
by
a
proclamation
dated
April
1st,
1949,
brought
into
force
in
the
Province
as
of
that
date
the
Customs
Act
and
the
Excise
Tax
Act
of
Canada.
By
another
proclamation,
of
May
9th,
1949,
the
Dominion
Income
Tax
Act
was
brought
into
force
in
the
Province
as
of
May
16th,
1949,
the
date
of
the
publication
of
the
proclamation
in
the
Canada
Gazette.
If
there
were
any
doubt
as
to
the
intention
to
make
applicable
the
Customs
Act,
the
Excise
Tax
Act,
and
the
Income
Tax
Act,
of
the
Dominion
such
doubt
is
removed
by
the
provisions
of
Section
49
of
chapter
25
of
the
1949
Canadian
Statutes
(Second
Session).
The
questions
submitted
may
be
answered
by
a
consideration
of
paragraphs
(1)
and
(3)
of
Term
18
when
applied
to
the
listed
statutes
which
I
assume
are
part
of
the
‘
4
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union.’’
These
statutes
deal
with
Bowater’s
Newfoundland
Pulp
and
Paper
Mills
Limited
or
its
predecessors,
all
of
which
will
be
hereafter
included
in
the
term
‘‘Company’’.
They
were
concerned
with
giving
effect
to
and
carrying
out
various
agreements
between
the
Company
and
the
Government
of
Newfoundland.
The
latter
was
interested
in
promoting
the
development
of
industry
in
the
country
and
the
Company
was
interested
in
obtaining
lands,
mineral
rights,
water
rights,
timber
rights
and
concessions.
It
may
be
stated
briefly
that
the
agreements
provide:—
the
stock
and
shares,
and
the
bonds,
debentures,
debenture
stock,
mortgage,
and
other
securities
of
the
Company
are
exempt
from
taxation
for
a
period
of
fifty
years;
the
Company
is
to
pay
the
Government
for
five
years
in
respect
of
its
income
a
tax
of
twenty
per
centum
subject
to
a
maximum;
import
duties
on
certain
articles
are
foregone;
certain
property
of
the
Company
is
exempt
from
municipal
taxation;
the
Government
of
Newfoundland
and
the
Treasury
in
England
agree
to
guarantee
certain
debentures
of
the
Company,
which
guarantees,
we
are
informed,
have
been
given.
On
the
other
hand,
the
Company
agrees
to
establish
and
maintain
certain
water-power
developments
and
manufacturing
establishments,
and
we
are
told
that
its
investment
in
Newfoundland
amounts
approximately
to
eighty-
six
million
dollars.
The
Company
admits
that
the
Dominion
may
require
to
be
taken
out
a
licence,
permit,
or
certificate,
as
referred
to
in
the
questions,
but
denies
that
Canada
may
exact
duties
or
taxes
otherwise
than
as
provided
by
the
Newfoundland
statutes.
Its
first
argument
runs
as
follows.
While
it
is
admitted
that
paragraphs
(1)
and
(4)
of
Term
18
correspond
generally
to
section
129
of
the
British
North
America
Act,
1867,
it
is
pointed
out
that
the
B.N.A.
Act,
1949
(Imperial),
gave
the
Terms
of
Union
the
force
of
law
notwithstanding
anything
in
the
B.N.A.
Acts,
1867
to
1946.
Hence
it
follows,
it
is
said,
that
Term
18
must
be
taken
to
contain
all
the
provisions
relative
to
the
determination
of
the
points
involved
in
this
reference
and,
to
give
full
effect
thereto,
the
laws
of
Newfoundland
in
force
at
the
date
of
Union
must
be
divided
into
three
categories
:—
(a)
those
which
fall
clearly
within
the
Dominion
field
under
the
B.N.A.
Act
and
are
subject
to
be
repealed,
abolished
or
altered
by
the
Federal
Parliament
;
(b)
those
which
fall
clearly
within
the
provincial
field
and
are
subject
to
be
repealed,
abolished
or
altered
by
a
provincial
legislature
;
(ce)
those
not
falling
within
either
of
the
categories
(a)
or
(b)
but
which
are
of
mixed
subject-matter
and
inseverable
such
as
the
Bowater’s
law,
which
is
a
law
in
which
matters
under
Dominion
and
Provincial
control
are
so
interwoven
as
to
constitute
an
indissoluble
mixture
of
consideration
flowing
to
and
from
Bowater’s
as
to
be
inseverable.
If
any
particular
law
falls
within
(a)
or
(b),
then
either
Parliament
or
the
Legislature,
as
the
case
may
be,
is
empowered
to
act
but,
if,
as
is
contended
here,
it
is
within
category
(c),
then
paragraph
(3)
of
Term
18
applies
and
Parliament
may
repeal
it
but
only
with
the
consent
of
the
Legislature.
This
paragraph,
it
will
be
noticed,
does
not
provide
for
a
mere
alteration
and
the
argument
cannot
prevail
since
it
leaves
no
room
for
the
application
of
paragraph
(1)
of
Term
18.
While
the
questions
are
general
in
their
terms
as
to
the
Acts
of
the
Parliament
of
Canada,
the
discussion
at
Bar
centered
around
the
Income
Tax
Act,
the
Customs
Act,
and
the
Excise
Tax
Act.
As
to
these,
I
have
no
difficulty
in
answering
each
of
the
questions
in
the
negative
upon
a
consideration
of
paragraph
(1)
of
Term
18,
taken
in
conjunction
with
paragraph
(3)
thereof,
because
those
fields
are
indisputably
open
to
the
Dominion
under
section
91
of
the
British
North
America
Act,
1867,
and
those
three
Acts
were
brought
into
force
in
Newfoundland
by
proclamations
as
provided
by
paragraph
(2).
The
same
result
follows
with
respect
to
any
duty
or
taxes
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
any
obligation
under
any
such
Act
imposing
any
duty
or
tax,
or
any
such
Act
requiring
a
licence,
permit,
or
certificate
for
the
export
or
import
of
goods
so
long
as
such
Act
relates
to
any
field
allotted
to
the
Dominion.
Whatever
may
have
been
in
the
mind
of
the
draftsman,
the
mere
power
conferred
by
paragraph
(8)
to
repeal
with
the
consent
of
the
Newfoundland
Legislature
cannot
cut
down
the
previous
power
to
repeal,
abolish
and
alter,
that,
in
the
relevant
fields,
is
conferred
by
paragraph
(1)
upon
the
Parliament
of
Canada.
This
conclusion
is
strengthened
by
paragraph
(4)
of
Term
27,
which
appears
under
the
heading
"Tax
Agreement’’.
This
term
provides
for
a
possible
agreement
between
the
Government
of
Canada
and
the
Government
of
the
Province
of
Newfoundland
for
the
rental
to
the
former
of
the
income,
corporation
income,
and
corporation
tax
fields,
and
the
succession
duties
tax
field.
Paragraph
(4)
reads
:—
""
(4)
The
Government
of
the
Province
of
Newfoundland
shall
not
by
any
agreement
entered
into
pursuant
to
this
Term
be
required
to
impose
on
any
person
or
corporation
taxation
repugnant
to
the
provisions
of
any
contract
entered
into
with
such
person
or
corporation
before
the
date
of
the
agreement
and
subsisting
at
the
date
of
the
agreement.’’
The
very
fact
that
in
connection
with
such
a
matter
provision
is
made
whereby
the
Newfoundland
Government
is
not
obliged
to
impose
taxes
repugnant
to
a
mentioned
contract
indicates
that
under
Term
18(1)
the
power
of
Parliament
is
untrammelled
when
acting
within
its
proper
field
of
activity.
The
second
of
the
Company^
arguments
starts
with
the
assumption
that
paragraphs
(1)
and
(4)
of
Term
18
correspond
to
section
129
of
the
British
North
America
Act,
1867,
and
then
proceeds
to
rely
upon
the
decision
of
the
Judicial
Committee
in
Dobie
v.
Temporalities
Board
(1881),
7
A.C.
186,
delivered
by
Lord
Watson,
as
establishing
that
since
the
Canadian
Parliament
could
not
have
entered
into
all
the
terms
of
the
various
agreements
with
the
Company,
and
since
all
the
terms
thereof
are
so
indissolubly
mixed,
Parliament
has
no
jurisdiction
to
enact
legislation
relating
to
any
of
the
terms.
In
that
case
a
statute
of
the
old
Province
of
Canada
had
created
a
corporation
having
a
corporate
existence
and
rights
in
Ontario
and
Quebec,
and
it
was
held
by
the
Judicial
Committee
that
after
Confederation
it
could
not
be
repealed
or
modified
by
the
Legislature
of
either
Ontario
or
Quebec
or
by
the
joint
operation
of
both
but
only
by
the
Parliament
of
the
Dominion.
An
Act
of
Quebec,
which
purported
to
amend
the
pre-Confederation
statute,
did
not
profess
to
repeal
and
amend
the
earlier
Act
only
in
so
far
as
its
provisions
might
apply
to
or
be
operative
within
the
Province
of
Quebec
and
its
enactments
were
apparently
not
framed
with
a
view
to
any
such
limitation.
Lord
Watson
points
this
out
at
page
150
and
states
that
the
reason
for
it
was
obvious
and
that
it
was
a
reason
fatal
to
the
validity
of
the
Act.
He
continues
:—
"The
corporation
and
the
corporate
trust,
the
matters
to
which
its
provisions
relate,
are
in
reality
not
divisible
according
to
the
limits
of
provincial
authority.
In
every
case
where
an
Act
applicable
to
the
two
provinces
of
Quebec
and
Ontario
can
now
be
validly
repealed
by
one
of
them,
the
result
must
be
to
leave
the
Act
in
full
vigour
within
the
other
province.
But
in
the
present
case
the
legislation
of
Quebec
must
necessarily
affect
the
right
and
status
of
the
corporation
as
previously
existing
in
the
province
of
Ontario,
as
well
as
the
rights
and
interests
of
individual
corporators
in
that
province.”
This
extract
clearly
shows
the
distinction
between
that
case
and
the
problem
presented
to
us.
But
the
Company
points
particularly
to
the
following
statement
by
Lord
Watson
in
the
same
case
at
page
147
with
reference
to
section
129
of
the
British
North
America
Act
of
1867:
‘“‘The
powers
conferred
by
this
section
upon
the
provincial
Legislatures
of
Ontario
and
Quebec
to
repeal
and
alter
the
statutes
of
the
old
Parliament
of
the
province
of
Canada
are
made
precisely
co-extensive
with
the
powers
of
direct
legislation
with
which
these
bodies
are
invested
by
the
other
clauses
of
the
Act
of
1867.
In
order,
therefore,
to
ascertain
how
far
the
provincial
Legislature
of
Quebec
had
power
to
alter
and
amend
the
Act
of
1858
incorporating
the
Board
for
the
management
of
the
Temporalities
Fund,
it
becomes
necessary
to
revert
to
sects.
91
and
92
of
the
British
North
America
Act,
which
enumerate
and
define
the
various
matters
which
are
within
the
exclusive
legislative
authority
of
the
Parliament
of
Canada,
as
well
as
those
in
relation
to
which
the
Legislatures
of
the
respective
provinces
have
the
exclusive
right
of
making
laws.
If
it
could
be
established
that,
in
the
absence
of
all
previous
legislation
on
the
subject
the
Legislature
of
Quebec
would
have
been
authorized
by
sect.
92
to
pass
an
Act
in
terms
identical
with
the
22
Vict.
c.
66,
then
it
would
follow
that
the
Act
of
the
22nd
Vict.
had
been
validly
amended
by
the
38
Vict.
ce.
64.
On
the
other
hand,
if
the
Legislature
of
Quebec
has
not
derived
such
power
of
enactment
from
sect.
92,
the
necessary
inference
is
that
the
legislative
authority
required
in
terms
of
sect.
129
to
sustain
its
right
to
repeal
or
alter
an
old
law
of
the
Parliament
of
the
province
of
Canada
is
in
this
ease
wanting,
and
that
the
Act
38
Vict.
c.
64,
was
not
intra
vires
of
the
Legislature
by
which
it
was
passed.”
Furthermore,
the
Company
relies
upon
the
statement
of
Lord
Watson,
delivering
the
judgment
of
the
Privy
Council
in
the
Distillers
and
Brewers
Case,
Attorney-General
for
Ontario
v.
Attorney-General
for
Canada,
[1896]
A.C.
348,
at
page
366,
where
he
says
:—
i
It
appears
to
their
Lordships
that
neither
the
Parliament
of
Canada
nor
the
provincial
legislatures
have
authority
to
repeal
statutes
which
they
could
not
directly
enact.
Their
Lordships
had
occasion,
in
Dobie
v.
Temporalities
Board,
to
consider
the
power
to
repeal
competent
to
the
legislature
of
a
province.
.
.
.
The
same
principle
ought,
in
the
opinion
of
their
Lordships,
to
be
applied
to
the
present
case.’’
But
on
that
Reference
it
was
held
that
in
so
far
as
the
provincial
enactments
came
into
collision
with
the
provisions
of
the
Canada
Temperance
Act
of
1886
they
must
yield
to
Dominion
legislation.
Instead
of
assisting
the
Company’s
present
argument,
the
decision
is
definitely
against
it.
Here
it
is
not
suggested
by
the
questions
that
any
attempt
would
be
made
by
Parliament
to
repeal
the
Newfoundland
statutes
but
the
point
involved
is
whether
Parliament
may
enact
legislation
relating
to
subjects
assigned
to
it
although
such
legislation
may
affect
provincial
matters.
The
rule
that
it
may
do
so
is
well
settled
and
has
been
consistently
followed
and
neither
the
judgment
in
the
Dobie
case
nor
Lord
Watson’s
statement
at
pages
147
and
150,
quoted
above,
are
in
conflict
with
it.
I
therefore
answer
each
of
the
questions
in
the
negative.
I
HEREBY
CERTIFY
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
TASCHEREAU,
J.:—From
1915
to
1947,
the
Government
of
Newfoundland
enacted
several
Statutes
for
the
purpose
of
ratifying
or
modifying
various
agreements
entered
into
with
the
Bowater’s
Newfoundland
Pulp
and
Paper
Mills
and
its
predecessors.
It
is,
I
think,
unnecessary
to
analyze
in‘detail
all
these
laws
and
agreements.
It
will
be
sufficient
to
mention
that
the
Government
of
Newfoundland,
for
the
purpose
of
developing
enterprises
in
the
Colony,
and
creating
new
industries,
made
certain
concessions
and
granted
privileges
to
the
Company,
in
consideration
of
which
the
latter
assumed
specific
and
quite
onerous
obligations.
The
purpose
of
this
Reference
is
to
obtain
the
opinion
of
this
Court,
as
to
whether
or
not
the
Company
is
entitled,
since
Newfoundland
has
become
a
Province
of
Canada,
to
any
deduction,
exemption
or
immunity
in
respect
of
any
duty
or
tax
imposed
by
any
act
of
the
Parliament
of
Canada.
The
Company
has
fulfilled
all
its
obligations,
has
spent
over
$85,000,000.
and
now
claims
that
it
is
entitled
to
the
exemptions
and
deductions
of
income
tax,
customs
and
excise
duties
granted
by
the
agreements
entered
into
with
the
Government
of
Newfoundland,
and
which
in
view
of
the
Statutes
enacted,
have
the
force
of
law.
It
is
of
course
not
contested
that
income
tax,
customs
and
excise
duties
may
be
properly
imposed
by
the
Dominion
Government,
but
the
submission
is
that
by
the
Terms
of
Union,
the
Company
still
enjoys
the
privileges
granted
by
the
Government
of
Newfoundland,
and
that
it
is
therefore
beyond
the
powers
of
the
Dominion
to
deprive
the
Company
of
the
exemptions
conferred
by
the
then
competent
authority.
The
Attorney-General
‘s
submission
is
that
Parliament
has
legislative
authority
to
amend
or
override
laws
of
Newfoundland
that
are
continued
after
the
Union,
to
the
extent
that
the
subject
matters
of
the
laws
fall
within
the
legislative
authority
of
Parliament,
under
section
91
of
the
British
North
America
Act.
This
would
be
expressly
reserved
to
Parliament
by
Term
18
of
the
Union
which
continues
the
laws,
subject
to
the
power
of
Parliament
and
the
Legislature,
to
amend
or
override
them
within
their
respective
spheres.
Section
18(1)
of
An
Act
to
approve
the
Terms
of
Union
of
Newfoundland
with
Canada
and
assented
to
on
the
18th
of
February,
1949,
is
as
follows
:—
4
'18.
(1)
Subject
to
these
Terms,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
shall
continue
therein
as
if
the
Union
had
not
been
made,
subject
nevertheless
to
be
repealed,
abolished,
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946,
and
all
orders,
rules,
and
regulations
made
under
any
such
laws
shall
likewise
continue,
subject
to
be
revoked
or
amended
by
the
body
or
person
that
made
such
orders,
rules,
or
regulations
or
the
body
or
person
that
has
power
to
make
such
orders,
rules,
or
regulations
after
the
date
of
Union,
according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946.’’
Section
18(2)
is
in
the
following
terms:—
"18.
(2)
Statutes
of
the
Parliament
of
Canada
in
force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
Province
of
Newfoundland
on
a
day
or
days
to
be
fixed
by
Act
of
the
Parliament
of
Canada
or
by
proclamation
of
the
Governor
General
in
Council
issued
from
time
to
time,
and
any
such
proclamation
may
provide
for
the
repeal
of
any
of
the
laws
of
Newfoundland
that
(a)
are
of
general
application
;
(b)
relate
to
the
same
subject-matter
as
the
statute
or
part
thereof
so
proclaimed;
and
(c)
could
be
repealed
by
the
Parliament
of
Canada
under
paragraph
one
of
this
Term.’’
It
will
be
observed
that
section
18(1)
is
substantially
similar
to
section
129
of
the
British
North
America
Act,
dealing
with
the
continuation
and
repealing
of
laws.
This
section
129
is
as
follows
:—
1
"
129.
Except
as
otherwise
provided
by
this
Act,
all
laws
in
force
in
Canada,
Nova
Scotia,
or
New
Brunswick
at
the
Union,
and
all
Courts
of
Civil
and
Criminal
Jurisdiction,
and
all
legal
Commissions,
Powers,
and
Authorities,
and
all
Officers,
Judicial,
Administrative,
and
Ministerial,
existing
therein
at
the
Union,
shall
continue
in
Ontario,
Quebec,
Nova
Scotia,
and
New
Brunswick
respectively,
as
if
the
Union
had
not
been
made;
subject
nevertheless
(except
with
respect
to
such
as
are
enacted
by
or
exist
under
Acts
of
the
Parliament
of
great
Britain
or
of
the
Parliament
of
the
United
Kingdom
of
Great
Britain
and
Ireland)
to
be
repealed,
abolished,
or
altered
by
the
Parliament
of
Canada,
or
by
the
Legislature
of
the
respective
Province,
according
to
the
Authority
of
the
Parliament
or
of
that
Legislature
under
this
Act.’’
Pursuant
to
the
powers
granted
to
the
Dominion
under
section
18(2),
the
Governor
General
in
Council
issued
a
proclamation
on
April
1st,
1949,
bringing
into
force
in
Newfoundland
the
Customs
Act
and
the
Excise
Act,
and
on
May
9th,
1949,
another
proclamation
brought
into
force
the
Dominion
Income
Tax
Act.
Furthermore,
in
1949,
the
Parliament
of
Canada
enacted
An
Act
to
Amend
The
Income
Tax
Act
and
The
Income
War
Tax
Act
(Ch.
25,
Statutes
of
Canada,
1949,
2nd
Session),
and
the
relevant
sections
which
are
49
and
50,
provide
as
follows
:—
"49.
For
greater
certainty
it
is
hereby
declared
and
enacted
that,
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-nine),
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada.
50.
Notwithstanding
anything
contained
in
this
or
any
other
Act
an
exemption
from
taxation
provided
for
in
an
international
treaty
or
international
agreement
binding
on
Newfoundland
before
the
union
of
Newfoundland
with
Canada
may
be
extended
by
regulation
of
the
Governor
in
Council
to
taxation
by
or
under
any
Act
of
the
Parliament
of
Canada.
‘
‘
Before
joining
Confederation,
Newfoundland
had
a
unitary
Government
and
by
virtue
of
its
undivided
powers,
had
full
authority
to
enact
laws
concerning
the
various
matters
found
in
the
agreements
with
the
Company.
It
could
competently
deal
with
income
tax,
customs
and
excise
duties,
land
and
water
grants,
mining
concessions,
municipal
taxation,
matters
which
under
the
scheme
of
Confederation
are
not
attributed
to
only
one
authority.
The
validity
of
the
agreements
entered
into
are
therefore
unchallengeable.
However,
by
entering
Confederation,
Newfoundland
renounced
its
rights
to
legislate
on
all
subject-matters
which
are
under
the
British
North
America
Act,
of
the
exclusive
jurisdiction
of
the
Parliament
of
Canada,
and
its
legislative
authority
was
therefore
limited
to
the
narrower
sphere
of
section
92.
This
limited
status
created
an
entirely
new
situation
for
Newfoundland,
and
the
question
now
arises
as
to
which
authority
has
the
power
to
repeal
in
toto
or
partially
the
Statutes
which
have
given
force
of
law
to
the
agreements
entered
into
between
the
parties.
The
Terms
of
Union
contemplate
the
continuation,
amendment,
or
repeal
of
the
laws
of
Newfoundland,
and
the
enforcement
and
application
in
the
New
Province
of
the
laws
of
Canada.
It
is
unquestionable
that
all
the
laws
enacted
by
the
former
Government
of
Newfoundland,
and
dealing
with
matters
enumerated
in
section
91
of
the
B.N.A.
Act,
may
be
repealed,
abolished
or
altered
by
the
Central
Government,
which
is,
by
virtue
of
the
law,
vested
with
the
necessary
authority
to
deal
with
these
matters.
The
case
would
be
an
easy
one
if
we
had
merely
to
decide
that
federal
income
tax,
customs
and
excise
duties
imposed
by
the
Parliament
of
Canada,
apply
to
Newfoundland,
but
the
Statutes
with
which
we
have
to
deal
cover
so
many
different
matters,
of
both
provincial
and
federal
competency,
and
are
so
linked
together
that
an
entirely
new
situation
arises.
They
cover
matters
some
of
which
are
now
within
the
legislative
powers
of
the
Province
of
Newfoundland.
Under
the
Terms
of
Union,
Newfoundland
has
obviously
a
new
status,
but
I
cannot
agree
with
the
submission
of
the
Attorney-
General
for
Canada
that
the
Statutes
referred
to
in
the
questions
submitted
ceased
to
operate
at
the
time
of
the
Union
of
Newfoundland
with
Canada.
By
the
very
terms
of
section
18,
para.
(1)
of
the
Act
to
approve
the
Union,
all
the
laws
in
force
in
Newfoundland,
at
or
prior
to
the
date
of
Union,
continue
as
if
the
Union
had
not
been
made,
subject
to
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature,
according
to
their
respective
authority
under
the
B.N.A.
Act.
It
follows
that
these
Statutes
continue
to
be
in
force,
until
repealed
by
the
competent
authority.
It
cannot
be
contested
that
agreements
of
this
kind
are
given
a
legal
effect
only
because
of
a
statutory
approval,
and
that
they
cease
to
have
such
an
effect
with
the
withdrawal
of
the
approval.
(Attorney-General
for
B.C.
v.
Esquimault
and
Nanaimo,
[1950]
1
D.L.R.
305).
But
with
respect,
I
believe
that
neither
the
Parliament
of
Canada,
by
legislation,
nor
the
Governor
General
in
Council,
by
proclamation,
may
withdraw
the
approval
which
has
been
given
to
the
Statutes
now
under
consideration.
If
all
the
matters
covered
by
the
agreements
were
matters
on
which
the
Dominion
could
competently
legislate
under
section
91,
I
would
not
hesitate
to
answer
the
inerrogatories
in
the
negative,
in
view
of
section
18(1),
because
the
Statutes
would
then
be
repealed,
abolished
or
altered
by
the
competent
authority.
But
these
Statutes
do
not
deal
only
with
matters
of
federal
concern,
but
also
with
matters
which
are
now
clearly
of
the
exclusive
province
of
the
local
Legislature.
They
are
so
closely
interwoven
that
they
form
together
a
complete
unity
that
makes
them
inseverable.
They
must
be
read
together;
they
form
a
group
that
cannot
be
altered
piecemeal,
without
affecting
fundamentally
their
"‘raison
d’être”.
If
so,
they
would
not
have
any
effective
operation,
as
the
whole
scheme
contemplated
would
be
entirely
destroyed.
They
surely
would
not
have
been
adopted,
amputated
of
all
that
is
now
proposed
to
be
repealed.
(Attorney-General
for
Alberta
v.
Attorney-General
for
Canada,
[1947]
A.C.
at
p.
519).
In
Dobie
v.
Temporalities
Board,
[1881]
A.C.
136,
the
Judicial
Committee
discussed
section
129
of
the
B.N.A.
Act,
a
section
which
is
substantially
similar
to
section
18(1)
of
the
Terms
of
Union,
and
at
page
147
their
Lordships
expressed
the
following
views
:—
"‘The
powers
conferred
by
this
section
upon
the
provincial
Legislatures
of
Ontario
and
Quebec
to
repeal
and
alter
the
statutes
of
the
old
Parliament
of
the
Province
of
Canada
are
made
precisely
co-extensive
with
the
powers
of
direct
legislation
with
which
these
bodies
are
invested
by
the
other
clauses
of
the
Act
of
1867.
.
.
.
If
it
could
be
established
that
in
the
absence
of
all
previous
legislation
on
the
subject
the
Legislature
of
Quebec
would
have
been
authorized
by
sect.
92
to
pass
an
Act
in
terms
identical
with
the
22
Vict.
c.
66,
then
it
would
follow
that
the
Act
of
the
22nd
Vict.
has
been
validly
amended
by
the
38
Vict.
c.
64.
On
the
other
hand,
if
the
Legislature
of
Quebec
has
not
derived
such
power
of
enactment
from
Sect.
92,
the
necessary
inference
is
that
the
legislative
authority
required
in
terms
of
sect.
129
to
sustain
its
right
to
repeal
or
alter
an
old
law
of
the
Parliament
of
the
Province
of
Canada
is
in
this
case
wanting,
and
that
the
Act
38
Vict.
c.
64,
was
not
intra
vires
of
the
Legislature
by
which
it
was
passed.’’
Later,
in
Attorney-General
for
Ontario
v.
Attorney-General
for
the
Dominion,
[1896]
A.C.
348),
their
Lordships
said
at
page
366
:—
“It
appears
to
their
Lordships
that
neither
the
Parliament
of
Canada,
nor
the
Provincial
Legislatures
have
authority
to
repeal
Statutes
which
they
could
not
directly
enact.’’
Applying
these
principles
to
the
present
case,
it
would
appear
that
the
Dominion
cannot
legislate
in
any
way
to
modify
these
inseverable
Statutes
in
such
a
way
that
their
purpose
would
be
defeated,
for
the
reason
that
it
could
not,
in
view
of
the
divided
legislative
powers
attributed
by
the
B.N.A.
Act,
directly
enact
them.
If
it
did
so,
it
would
invade
a
field
which
is
reserved
exclusively
to
the
jurisdiction
of
the
Legislature,
and
consequently,
act
beyond
its
constitutional
powers.
Unless
very
extraordinary
conditions
happen,
the
respective
legislative
authority
of
the
Dominion
and
of
the
Provinces
is
found
in
sections
91
and
92
of
the
B.N.A.
Act,
and
the
exclusive
powers
that
belong
to
each
authority
cannot
be
delegated
to
the
other.
But
there
are
cases
where
serious
conflicts
would
occur
if
the
co-operation
of
the
Dominion
and
the
Provinces
was
not
willingly
offered,
to
arrive
at
a
satisfactory
solution.
(Attorney-
General
for
B.C.
v.
Attorney-General
for
Canada,
[1937]
A.C.
at
p.
389).
The
present
case
is,
I
think,
one
of
these,
and
it
seems
to
be
reasonably
clear,
that
it
is
with
the
above
pronouncement
of
the
Judicial
Committee
in
mind
that
the
framers
of
the
Terms
of
Union
incorporated
section
18(3)
in
the
Act
to
approve
the
Terms
of
Union.
It
reads
as
follows
:
"18(3)
Noth
withstanding
anything
in
these
Terms,
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.
‘‘
Of
course,
the
consent
of
the
Legislature
cannot
empower
the
Dominion
to
legislate
on
provincial
matters.
But
the
Imperial
Statute
which
ratified
the
Terms
of
Union
vested
in
the
Dominion
the
necessary
authority
to
do
so,
after
the
consent
has
been
obtained
legally.
At
the
hearing,
the
Attorney-General
for
Newfoundland
who
intervened
to
support
the
stand
taken
by
the
Company,
said
that
this
section
18(3)
was
incorporated
in
the
Act
for
the
very
purpose
of
dealing
with
cases
such
as
the
one
which
is
submitted
to
this
Court.
The
plausibility
of
this
statement
cannot
be
challenged,
for
it
was
common
knowledge
that
the
former
unitary
Government
of
Newfoundland,
being
then
supreme
in
its
legislative
powers,
had
enacted
laws
which
are
now
of
a
mixed
federal
and
provincial
character,
and
that
they
continued
in
force
by
the
Terms
of
Union.
There
being
no
authority
to
repeal
these
inseverable
laws,
the
necessary
power
was
granted
by
the
Imperial
Parliament
to
the
Dominion
to
repeal
them
with,
however,
the
consent
of
the
Legislature
of
Newfoundland.
As
this
consent
has
not
been
obtained,
I
have
come
to
the
conclusion
that
the
Parliament
of
Canada
alone
has
no
power
to
impose
taxation
upon
the
Company
in
contravention
to
the
Terms
of
the
agreements
which
have
been
ratified
by
Statutes.
I
would
therefore
answer
the
interrogatories
as
follows
:
1.
Yes;
the
deductions,
exemptions,
immunities
and
privileges
provided
for
in
the
said
Statutes
of
Newfoundland.
2.
No,
except
in
respect
of
the
obligations
to
pay
duties
or
taxes
otherwise
than
as
provided
by
the
said
Statutes
of
Newfoundland.
3.
No,
except
in
so
far
as
the
acquisition
or
possession
of
any
such
licence,
permit
or
certificate
entails
the
payment
of
duties
or
taxes
otherwise
than
as
provided
by
the
said
Statutes
of
Newfoundland.
I
HEREBY
CERTIFY
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
Rand,
J.:—The
Governor
in
Council
has
referred
to
this
Court
the
following
questions
:—
1.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada?
2.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of
any
obligation
under
any
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax?
3.
Is
Bowater’s
Newfoundland
Pulp
&
Paper
Mills
Limited
entitled
by
reason
of
the
Statutes
of
Newfoundland
listed
hereunder
to
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
license,
permit
or
certificate
for
the
export
or
import
of
goods
?
They
arise
in
the
context
of
a
series
of
instruments
executed
between
1915
and
1942
between
His
Majesty
represented
by
the
Governor
in
Council
of
Newfoundland
and
the
respondent
company
or
its
predecessors
in
title
and
confirmed
in
several
forms
by
the
legislature
of
that
colony.
Those
up
to
and
including
1923
were
"approved
and
confirmed’’:
amendments
in
1927
and
1935
were,
in
addition,
declared
to
"‘have
the
force
of
law’’
and
each
party
to
have
‘‘full
power
and
authority’’
to
carry
out
their
provisions;
and
in
1938,
‘‘to
have
the
force
and
effect
of
law
for
all
purposes
as
if
expressly
enacted
herein.’’
The
legislation
effected
original
modifications,
also,
both
by
way
of
amendment
or
clauses
contained
in
the
instruments
and
in
the
form
of
new
provisions.
The
matter
of
this
convention
was
a
large
scale
industrial
development
at
Corner
Brook,
Newfoundland,
involving
the
extensive
use
of
hydro-electric
power
in
the
production
of
fertilizers
and
allied
substances
and
the
manufacture
of
pulp
and
paper.
The
company
was
granted
lands,
waters
and
water
powers.
The
capital
investment
was
to
be
not
less
than
$20,000,000.00.
The
company
was
to
enjoy
two
concessions
which
raise
the
controversy
here,
one,
an
exemption,
for
periods
specified,
from
customs,
duties
or
taxes
on
certain
imports
and
exports;
the
other,
an
exemption
for
50
years
from
all
other
taxes
by
a
statutory
clause
which
at
the
same
time
provided
for
an
annual
payment
based
upon
a
percentage
of
defined
income
with
a
maximum
of
$150,000.00
per
annum.
The
provisions
governing
the
former
were
in
part
contained
in
the
instruments
and
in
part
in
legislative
amendments
or
original
enactments.
Throughout
the
instruments
and
the
legislation
there
is
preserved
the
conception
of
a
contractual
arrangement.
Its
matter
was
of
a
nature
that
required
legislation
which,
I
think,
has
given
statutory
fixation
to
its
terms.
The
grants
taken
by
them-
selves
may
or
may
not
have
been
within
the
authority
of
the
Crown
to
make;
but
the
exemptions
and
certain
powers
of
administrative
regulation
could
be
carried
out
only
under
legislative
efficacy.
It
is,
to
me,
indubitable
that
the
colonial
Legislature
before
the
Union
could,
of
its
own
motion,
and
regardless
of
the
assent
of
the
company,
have
altered
the
terms
with
which
we
are
concerned
without
affecting
the
validity
or
force,
though
not
necessarily
the
interpretation
or
effect
of
those
then
remaining.
Newfoundland
entered
into
the
federal
system
of
Canada
as
of
the
1st
day
of
April,
1949.
The
Terms
of
Union,
confirmed
by
Parliament
at
Westminster,
and
the
provisions
of
the
British
North
America
Acts,
1867
to
1946,
provide
the
investment
and
distribution
of
legislative
and
executive
powers
in
and
between
the
new
Province
and
the
Dominion
and
the
answers
to
the
questions
depend
on
the
effect
of
those
enactments
upon
the
legislative
contract.
As
has
been
so
often
reiterated
throughout
the
Commonwealth,
His
Majesty
maintains
a
constitutional
identity
as
the
sovereign
source
of
executive
and
legislative
power,
and
in
its
contractual
aspect
the
arrangement
suffered
no
disruption
by
reason
of
the
political
alteration.
In
the
aspect
of
legislation,
section
18(1)
of
the
Terms
of
Union
declares
that
:—
"‘Subject
to
these
terms,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
shall
continue
therein
as
if
the
Union
had
not
been
made,
subject
nevertheless
to
be
repealed,
abolished,
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946
.
.
.”
This,
for
all
purposes
here,
is
identical
in
effect
with
section
129
of
the
British
North
America
Act.
Section
18(3)
introduces
a
further
and
new
provision
:—
"Notwithstanding
anything
in
these
Terms
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.’’
The
legislative
result
of
the
Union
has
been
to
transfer
to
the
field
of
the
Dominion
those
provisions
of
law
which
relate
to
matters
attributed
in
the
constitutional
structure
to
the
Dominion;
from
the
moment
of
Union
they
operate
as
Dominion
laws,
subject
thereafter
to
be
dealt
with
under
section
18(1)
;
so,
likewise,
in
the
case
of
the
Province.
Is
the
exercise
of
these
new
jurisdictions
restricted
by
the
the
contractual
nature
of
the
arrangement
or
on
the
ground
that
the
instruments
and
the
legislation,
or
the
latter
alone,
constitute
a
legislative
entirety
?
At
the
outset,
several
propositions
must
be
postulated:
the
totality
of
legislative
power
exercisable
under
the
federal
constitution
must
be
taken
to
be
vested
in
the
Dominion
and
Province
with
each,
in
its
own
field,
sovereign,
whether
the
effective
exercise
1S
exclusive
or
in
co-operation,
but
always
as
a
several
exercise;
the
effect
of
section
18(1)
of
the
Terms
of
Union
and
section
129
of
the
British
North
America
Act
is
to
maintain
a
continuity
not
of
statutes
but
of
laws,
in
the
sense
of
distributive
provisions
which
take
their
place
in
the
one
or
other
jurisdiction
according
to
their
subject-matter
:
Dobie
v.
Temporalities
Board,
7
A.C.
136
;
and
that
modification
of
the
continued
laws
may
be
by
repeal
or
amendment
or
by
way
of
repugnant
enactment:
Attorney-General
of
Ontario
v.
Attorney-General
for
the
Dominion
[1896]
A.C.
348.
There
is
nothing
in
the
British
North
America
Acts
or
in
the
Terms
of
Union
which
allocates
a
legislative
contract
as
a
subjectmatter
of
jurisdiction.
A
contract
is
a
convention
resting
upon
and
within
limits
allowed
by
law.
It
may
deal
with
matters
regulated
by
laws
of
either
the
Dominion
or
Province.
Its
performance
is
carried
out
by
acts
subject
to
those
laws.
But
here
the
provisions
dealing
with
customs
duties
and
taxes
are
necessarily
legislative
provisions
which
only
the
state
could
undertake;
and
as
the
legislature
cannot
bind
its
future
action,
they
remain
subject
to
the
contingency
of
that
action.
What
in
substance
is
urged
by
the
company
is
that
the
Crown,
exercising
both
executive
and
legislative
capacities,
has
entered
into
a
legislative
bargain
which,
as
an
entirety,
must
be
brought
within
a
single
jurisdiction
as
a
legislative
subject-matter.
Before
the
Union,
the
Crown
as
executive
and
legislature
possessed
totality
of
power.
The
Union
effected
a
division
of
jurisdiction
in
laws
applicable
to
the
several
items
of
the
contract,
from
which
it
followed
that
the
source
of
law
now
necessary
to
the
contract
as
a
whole
is
seen
to
be
in
both
Parliament
and
Legislature.
The
action
of
these
bodies,
then
not
several
but
joint
as
by
one
legislative
organ,
upon
the
total
subject-matter,
is
the
only
means
by
which
the
terms
can
be
altered.
Consistently
with
this,
the
Crown
as
executive
would
now
have
two
sets
of
advisers
acting
jointly
and
each
interested
in
the
whole.
So
conceived,
the
act
of
each
body
requires
as
a
condition
of
its
legislative
efficacy
the
identical
act
of
the
other;
the
contract
has
become
the
subject-matter
of
simultaneous
and
conditional
legislative
jurisdiction
of
Canada
plus
Newfoundland.
This
is,
of
course,
to
be
distinguished
from
an
aggregate
of
several
power,
each
jurisdiction
acting
with
full
efficacy
ab
initio.
Such
a
conception
is
novel
in
the
history
of
federal
constitutionalism,
and
I
am
unable
to
find
anything
in
the
constitutional
enactments
that
gives
the
slightest
countenance
to
it.
Admittedly
the
provisions
are
not
severable
as
terms
of
a
contract,
but
they
are
clearly
so
as
legislative
subject-matters.
If
it
were
otherwise,
the
Province
could
not
now
by
itself
authorize
the
slightest
change
in
the
conditions
of
any
license
or
local
matter
involved
without
the
executive
and
legislative
concurrence
of
the
Dominion:
nor
could
the
Dominion
modify
even
beneficiently
to
the
company
the
customs
or
tax
concessions
and
maintain
them
within
the
integrity
of
the
legislation.
Such
results
would,
I
think,
be
absurd.
It
attributes
to
Parliament
and
Legislature
a
joint
jurisdiction
exceeding
their
several
aggregate.
It,
in
fact,
remits
the
arrangement
to
the
exclusive
Jurisdiction
of
the
Imperial
Parliament.
Section
18(3)
of
the
Terms
of
Union
permits
only
a
repeal
of
any
law.
This
contrasts
repeal
with
repugnancy
but
it
is
a
cumulative
power
and
cannot
be
taken
to
derogate
from
the
jurisdiction
of
Parliament
under
18(1).
The
consequence
of
an
inability
to
repeal,
in
its
strict
sense,
would
be
the
persistence
of
the
colonial
statute
to
which
future
legislation
would
be
related
as
the
underlying
law
:
section
18(3)
enables
that
state
of
things
to
be
eliminated.
But
the
contractual
effect
or
the
internal
relations
of
legislation
are
not
determinative
of
jurisdiction
under
the
Act
of
1867
:
it
is
the
matters
with
which
it
deals.
So
far
as
the
contract
needs
legislative
sustenance,
it
is
dependent
on
appropriate
statutory
action.
There
might,
of
course,
be
matter
which
could
be
dealt
with
affirmatively
under
Union
only
by
aggregate
action.
If,
for
instance,
there
had
been
a
railway
belonging
to
the
company
which
connected
with
that
of
the
Provincial
government
now
by
the
Terms
of
the
Union
passed
to
the
Dominion,
and
between
the
two
lines
a
statutory
traiff
of
joint
rates
had
been
in
force,
then
under
the
ruling
in
Montreal
v.
Montreal
Street
Railway,
[1912]
A.C.
333
the
legislative
authority
to
bring
about
such
a
rate
would
be
in
both
legislatures
acting
concurrently,
although
they
could
not
by
such
action
repeal
the
colonial
law;
but
it
could
not
be
doubted
that
in
such
a
case
either
legislature,,
exercising
its
own
jurisdiction,
could
frustrate
the
colonial
law
by
repugnant
law,
each
operative
independently
from
the
time
of
its
enactment.
But
that
character
of
legislative
action
is
denied
for
the
situation
here.
If
it
were
not
available,
there
would
be
a
lacuna
in
jurisdiction
which
we
have
long
since
excluded
from
our
constitutional
endowment.
The
case
of
Dobie
v.
Temporalities
Board,
supra,
was
strongly
urged
as
governing
the
issues-here.
In
that
case,
the
Legislature
of
Quebec
had
repealed
a
statute
of
the
Province
of
Canada,
continued
in
force
after
the
Union
by
section
129,
which
had
this
peculiarity
that
its
provisions
applied
both
to
Quebee
and
to
Ontario
and
were
incapable
of
being
severed
so
as
to
make
them
applicable
to
one
of
these
provinces
only.
It
was
argued
that
the
matter
applicable
to
two
provinces
was
analogous
to
matter
distributed
between
two
jurisdictions
which
here,
as
in
that
ease,
was
not
severable.
I
think
the
analogy
fails
on
both
grounds.
The
statutory
incorporation
was
obviously
of
a
nature
beyond
the
competence
of
either
province
to
enact
or
to
repeal:
and
the
exemptions
from
customs
duties
and
Dominion
taxation
are
for
legislative
purposes
as
severable
as
if
they
were
contained
in
another
statute.
It
is
only
when
we
consider
them
in
a
contractual
or
an
internal
dependency
aspect
that
any
such
question
arises.
Any
effect
upon
the
remaining
terms
of
the
arrangement
is
an
incidental
consequence
of
the
exercise
of
a
paramount
legislative
jurisdiction.
Results
of
this
nature
may
frustrate
the
original
object,
but
that
is
a
question
for
Parliament
;
with
it
the
courts
have
nothing
to
do.
Mr.
Carson
urged
the
ordinary
rule
of
severability
as
the
test
of
Dominion
jurisdiction,
but
I
cannot
see
its
relevancy.
The
question
is
not
whether
we
can
conclude
that
the
colonial
legislature
would
have
enacted
the
legislation
with
the
clauses
relating
to
duties
and
taxes
omitted;
I
assume
it
would
not;
the
question
is
the
wholly
different
one
of
its
jurisdiction
to
repeal
those
clauses
once
enacted
while
maintaining
the
remainder
of
the
legislation;
and
if
the
colonial
legislature,
as
I
think,
could
have
done
so,
as
certainly
the
Imperial
Parliament
could
have
done,
then
the
Canadian
Parliament,
exercising
its
jurisdiction
over
the
same
matters,
may
do
so
even
if
its
power
is
confined
to
those
items
and
that
of
the
colonial
legislature
was
not.
On
April
1st,
1949,
the
Customs
Act
and
on
May
9th,
1949,
the
Income
Tax
Act
were
brought
into
force
in
Newfoundland
by
proclamation
under
section
18(2)
of
the
Terms
of
Union.
By
chapter
25
of
the
Statutes
of
Canada
1949
(Second
Session)
the
following
amendment
to
the
Income
Tax
Act
was
enacted
:—
"‘49.
For
greater
certainty
it
is
hereby
declared
and
enacted
that,
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-nine),
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada.
‘
‘
The
effect
of
this
amendment,
the
general
application
of
which
was
not
disputed,
is
to
override
any
provision
of
the
legislative
arrangement
before
us
with
which
the
statutes
mentioned
conflict.
I
would,
therefore,
answer
the
questions
as
follows
:
1.
No.
2.
No.
3.
No.
I
HEREBY
CERTIFY
to
His
Exeellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
KELLOCK,
J.:—It
is
not
necessary
to
restate
the
questions
referred
to
this
Court.
The
essential
question
throughout
is
as
to
whether
or
not
the
respondent
company
may
claim
exemption
from
the
provisions
of
certain
federal
legislation,
namely,
The
Income
War
Tax
Act,
The
Customs
Act
and
The
Excise'
Act,
by
reason
of
anything
contained
in
certain
statutes
of
Newfoundland
enacted
prior
to
Union.
The
last
two
mentioned
statutes
were
proclaimed
to
be
in
force
in
the
new
province
as
of
April
Ist,
1949,
pursuant
to
subsection
(2)
of
Term
18
of
the
Terms
of
Union,
and
the
first
named
was
similarly
proclaimed
as
of
the
16th
of
May
following.
By
subsection
(1)
of
Term
18
it
is
provided
that,
subject
to
the
Terms,
all
laws’’
in
force
in
Newfoundland
at
or
immediately
prior
to
Union
shall
continue
therein,
subject
to
be
‘
repealed,
abolished,
or
altered’’
by
Parliament
or
the
provincial
legislature
according
to
the
authority
of
each
under
the
British
North
America
Act,
1867
to
1946.
By
subsection
(2),
already
referred
to,
it
is
provided
that
“statutes”
of
the
Parliament
of
Canada
in
force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
new
province
on
a
day
or
days
to
be
fixed
by
Act
of
Parliament
or
by
proclamation
of
the
Governor
General
in
Council.
Subsequent
to
the
proclamations
with
respect
to
the
three
statutes
already
referred
to,
Parliament
by
13
George
VI,
chap.
25,
sec.
49,
enacted
as
follows
:
“49.
For
greater
certainty
it
is
hereby
declared
and
enacted
that,
notwithstanding
any
other
Law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-
nine),
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada,
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
such
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada.''
Respondent
contends
in
the
first
place
that
nothing
in
the
Canadian
legislation
affects
its
position
under
the
pre-Union
legislation
of
Newfoundland.
It
is
said
that,
since
the
preUnion
legislation
includes
subject-matters
which
are
now
apportioned
for
legislative
purposes
between
Parliament
and
the
provincial
legislature
by
sections
91
and
92
of
the
British
North
America
Act,
and
since
neither
legislature
can
validly
legislate
with
respect
to
these
entire
matters,
neither
can,
of
itself,
‘
"
repeal,
abolish
or
alter’’
such
legislation.
In
support
of
this
argument,
reliance
is
placed
upon
the
judgments
of
the
Privy
Council
in
Dobie
V.
The
Temporalities
Board,
7
A.C.,
136,
and
Attorney-
General
for
Ontario
v.
Attorney-General
for
the'Dominion
(the
Local
Prohibition
case),
[1896]
A.C.,
348.
In
the
second
place,
it
is
said
that
the
only
means
by
which
the
pre-Union
legislation
can
be
effectively
dealt
with
is
by
joint
action
of
the
two
legislatures
under
subsection
(3)
of
Term
18.
With
respect
to
this
last-mentioned
argument,
I
am
of
the
opinion
that
subsection
(3)
in
no
way
limits
the
operation
of
subsections
(1)
and
(2).
It
is
expressly
limited
to
‘‘repeal’’
and,
in
any
event
in
my
view,
merely
provides
one
means
by
which
repeal
of
any
pre-Union
‘law”
may
be
effected.
As
to
the
first
argument,
it
was
held
in
Dobie’s
ease
that
a
pre-Confederation
statute
of
Canada
which
created
a
corpora-
tion
having
its
corporate
existence
and
rights
in
what
su’.
sequently
became
the
provinces
of
Ontario
&.an
Quebec,
could
not
be
repealed
by
the
legislature
of
either
province,
or
by
the
joint
operation
of
both,
but
only
by
the
Parliament
of
the
Dominion,
it
being
there
laid
down
that
the
power
of
a
provincial
legislature
to
alter
or
amend
a
pre-Confederation
statute
is
precisely
co-extensive
with
its
power
to
enact
identical
legislation.
In
the
Local
Prohibition
case,
Lord
Watson,
in
delivering
the
judgment
of
the
Board,
said
at
page
366:
"‘But
the
Dominion
Parliament
has
no
authority
conferred
upon
it
by
the
Act
to
repeal
directly
any
provincial
statute,
whether
it
does
or
does
not
come
within
the
limits
of
jurisdiction
prescribed
by
s.
92.
The
repeal
of
a
provincial
Act
by
the
Parliament
of
Canada
can
only
be
effected
by
repugnancy
between
its
provisions
and
the
enactments
of
the
Dominion.
.
.
.
It
appears
to
their
Lordships
that
neither
the
Parliament
of
Canada
nor
the
provincial
legislatures
have
authority
to
repeal
statutes
which
they
could
not
directly
enact.
‘
‘
The
Board
held
in
that
case
that
The
Canada
Temperance
Act
of
1886,
in
so
far
as
it
purported
expressly
to
repeal
the
prohibitory
clauses
of
the
pre-Confederation
statute
of
1864,
was
invalid.
That
statute
was
purely
local
in
its
nature
and
as
Parliament
could
not
enact
legislation
of
that
character,
neither
could
it
repeal
it.
It
will
be
seen
that
in
both
these
cases
what
the
Board
was
concerned
with
was
the
power
of
repeal
of
statutes
or
sections
of
statutes
in
their
entirety
and
that
the
subject-matters
of
the
same
were
outside
the
legislative
jurisdiction
of
Parliament
under
section
91.
Even
in
the
Dobie
case,
at
page
150
Lord
Watson
had
said
:
"
"
If,
by
a
single
Act
of
the
Dominion
Parliament,
there
had
been
constituted
two
separate
corporations,
for
the
purpose
of
working,
the
one
a
mine
within
the
province
of
Upper
Canada,
and
the
other
a
mine
in
the
province
of
Lower
Canada,
the
Legislature
of
Quebec
would
clearly
have
had
authority
to
repeal
the
Act
so
far
as
it
related
to
the
latter
mime
and
the
corporation
by
which
it
was
worked?
‘
In
Bonanza
Creek
v.
The
King,
[1916]
1
A.C.,
566,
also
Viscount
Haldane,
in
the
course
of
his
judgment,
said
with
reference
to
another
pre-Confederation
statute
of
1864,
at
page
583:
"‘It
was
obviously
beyond
the
powers
of
the
Ontario
Legislature
to
repeal
the
provisions
of
the
Act
of
1864,
excepting
in
so
far
as
the
British
North
America
Act
enabled
wt
to
do
this
in
matters
relating
to
the
province.’’
In
Attorney-General
for
Canada
v.
Attorney-General
for
Quebec,
[1921]
1
A.C.
413
(the
Fisheries
case),
the
Judicial
Committee
had
to
deal
with
the
respective
powers
of
the
Dominion
and
the
provinces
to
legislate
with
respect
to
fisheries.
In
this
ease
their
Lordships
referred
to
their
earlier
decision
in
[1898]
A.C.,
page
700,
which
had
dealt
with
legislation
affecting
the
same
subject-matter.
By
a
pre-Confederation
statute
of
1865
the
legislature
of
Canada
provided
for
the
amendment
of
the
law
relating
to
fishing
and
fisheries,
and
this
statute
applied
to
the
whole
of
Upper
and
Lower
Canada.
Section
3
authorized
the
Commissioner
of
Crown
Lands
to
issue
fishing
leases
and
licenses
while
other
sections
of
the
statute
dealt
with
the
management
and
regulation
of
fisheries,
the
obstruction
and
pollution
of
streams,
and
deep
sea
fishing.
After
Confederation,
in
1868,
the
Dominion
Parliament,
by
31
Vic.
cap.
60,
repealed
the
Act
of
1865
(section
20)
and
in
addition
enacted
a
number
of
provisions
in
many
respects
resembling
those
of
the
Act
of
1865.
The
substance
of
this
last-mentioned
Act
was
subsequently
incorporated
into
chapter
95
of
the
Revised
Statutes
of
Canada,
1886.
Section
4
of
this
statute
was
in
the
terms
of
the
former
corresponding
sections
of
1868
and
1865,
save
that
the
Minister
of
Marine
and
Fisheries
was
substituted
for
the
Commissioner
of
Crown
Lands.
Their
Lordships
point
out
that
the
Board
in
1898
had
held
that
the
Dominion
had
no
power
to
enact
Section
4,
as
it
dealt
with
a
matter
committed
exclusively
to
the
legislatures
of
the
provinces
and
that
this
decision
must
be
taken
to
be
settled
law.
There
is
no
suggestion
in
the
decision
of
1898,
nor
in
that
of
1921,
that
because
of
the
inclusion
of
the
provision
in
section
2
as
to
leases
and
licenses,
with
respect
to
which
the
Dominion
could
not
validly
legislate,
the
repeal
of
the
legislation
of
1865
by
section
20
was
invalid
also.
On
the
contrary,
Viscount
Haldane,
at
page
426,
pointed
out
that
by
reason
of
Section
20
of
the
Act
of
1868,
the
Act
of
1865
had
been
in
force
for
only
three
years
and
that
"Section
91
of
the
British
North
America
Act,
1867,
had
conferred
on
the
Dominion
Parliament
exclusive
authority
to
legislate
in
regard
to
sea
coast
and
inland
fisheries,
and
it
was
under
this
authority
that
the
repeal
was
effected.??
At
page
430
the
following
occurs:
"
1
As
to
s.
3
of
the
Act
of
1865
.
.
.
this
was
obviously
within
the
competence
of
the
Legislature
which
was
then
unrestricted
in
the
scope
of
its
power
to
alter
the
provincial
law.
No
distinction
was,
or
needed
to
be,
contemplated
between
power
of
regulation
and
power
over
proprietary
title.
Bearing
this
in
mind,
their
Lordships
think
that
s.
3
was
in
its
character
as
much
a
regulative
provision
as
it
was
one
directed
to
property.
These
two
aspects
of
its
subject-matter
were
really
then
inseparable.
In
so
far
as
its
powers
were
powers
of
regulation,
they
have
passed
to
the
Dominion
Parliament.”
There
was
no
discussion
as
to
whether,
because
of
the
fact
that
the
subject-matter
of
section
3
of
the
Act
of
1865
had
become
vested
for
legislative
purposes
in
two
different
legislatures,
the
repeal
in
1868
was
ineffective
as
to
that
section.
Perhaps,
consistently
with
the
earlier
decisions,
that
should
have
been
the
result,
but
the
point
was
not
in
issue.
I
therefore
think
that
what
was
said
by
Lord
Watson
in
[1896]
A.C.,
at
page
366,
in
the
passage
already
cited
is
limited
to
that
which
was
before
the
Board
in
that
case,
namely,
the
repeal
as
a
whole
of
a
statute
or
certain
specific
parts.
If
Parliament
cannot
enact,
it
cannot
repeal,
no
matter
whether
the
attempted
mode
is
by
express
repeal
or
by
the
enactment
of
repugnant
legislation.
‘‘For
neither
the
Parliament
of
Canada
nor
the
provincial
legislatures
have
authority
under
the
Act
to
nullify,
by
implication
any
more
than
expressly,
statutes
which
they
could
not
enact;’’
per
Viscount
Haldane
in
the
Great
West
Saddlery
ease,
[1921]
2
A.C.
91
at
page
117.
However,
where,
as
in
the
case
at
bar,
pre-Confederation,
or
pre-Union
legislation
covers
matters
as
to
which
there
has
since
obtained
a
division
of
legislative
jurisdiction
by
reason
of
sections
91
and
92
the
respective
legislatures
may
deal
with
the
matters
competent
to
each
and
thereby
affect
the
position
formerly
existing
under
the
legislation
enacted
prior
to
such
division.
In
the
present
case
there
is
no
‘‘express’’
repeal
but
in
my
opinion
the
three
Dominion
statutes
under
consideration
do
now
effectively
‘‘alter’’
and
(i
abolish”
the
privileged
position
to
which
the
respondent
was
entitled
under
the
legislation
of
Newfoundland
prior
to
1949.
The
word
"‘laws’’
in
Term
18
is
not
synonymous
with
statutes”,
as
it
is
clear
from
subsection
(2)
that
when
the
one
or
the
other
was
intended,
the
proper
term
was
employed.
Accordingly,
any
law,
statutory
or
non-statutory,
may,
by
the
express
terms
of
subsection
(1),
be
dealt
with
by
the
legislature
competent
to
deal
with
the
subject-matter.
There
is
no
question
but
that
Parliament
has
exclusive
jurisdiction
to
deal
with
subjectmatters
of
legislation
embodied
in
the
three
statutes
in
question.
If
the
pre-Union
Newfoundland
statutes
are
to
be
considered
as
continuing
in
force
after
the
proclamation
of
the
Dominion
statutes,
on
the
theory
that
the
Newfoundland
acts
are
special
legislation
and,
therefore,
constitute
an
exemption
from
the
terms
of
the
general
Acts,
section
49
of
the
1949
Act,
already
quoted,
is
effective
to
abolish
the
position
obtaining
under
the
special
legislation.
The
decision
in
this
Court
in
Re
New
Brunswick
Penitentiary
(1880)
Coutlee’s
cases,
page
24,
is
in
harmony
with
the
view
just
expressed.
In
that
case
certain
questions
were
referred
to
the
Court
by
the
Governor
General
in
Council
with
regard
to
the
power
of
Parliament
to
legislate
as
to
persons
to
be
confined
in
the
New
Brunswick
Penitentiary.
That
penitentiary
had
been
constituted,
and
provision
made,
for
the
class
of
persons
to
be
confined
therein,
by
pre-Confederation
legislation.
Subsequent
to
1867
Parliament
passed
legislation
providing
for
a
joint
penitentiary
for
the
provinces
of
Nova
Scotia,
New
Brunswick
and
Prince
Edward
Island,
and
delineating
the
class
of
persons
to
be
confined
therein.
On
a
question
raised
by
the
Government
of
New
Brunswick
as
to
the
power
of
Parliament
to
so
legislate,
it
was
held
that
under
section
91
Parliament
had
power
to
so
enact,
and
that
that
pawer
was
in
no
way
limited,
restricted,
or
affected
by
any
legislation
of
the
province
either
prior
or
subsequent
to
Confederation.
While
the
exemptions
here
in
question
originated
by
way
of
contract,
they
required
for
their
efficacy
the
intervention
of
the
legislature
and,
as
already
pointed
out,
with
respect
to
the
matters
with
which
we
are
here
concerned,
legislative
jurisdiction
passed
upon
Union
to
Parliament.
There
is
no
ground,
in
my
opinion,
upon
which
it
can
be
said
that
Parliament
is
restrained
from
legislating
as
it
sees
fit
with
regard
to
such
subject-matter.
The
questions
should,
therefore,
be
answered
in
the
negative.
I
hereby
certify
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
ESTEY,
J.:—The
Bowater’s
Newfoundland
Pulp
and
Paper
Mills,
Limited,
by
virtue
of
a
series
of
agreements,
concluded
with
the
Government
of
Newfoundland
from
1915
to
1947
assumed
obligations
and
obtained
exemptions
from
certain
taxes
and
customs
duties,
and
in
this
reference
it
claims
that
these
exemptions
were
continued
under
the
Terms
of
Union
between
the
Dominion
of
Canada
and
Newfoundland.
The
said
agreements
were
all
confirmed
by
statutes
and
such
as
were
in
force
at
the
date
of
the
Union
were
continued
by
virtue
of
para.
18(1)
of
the
Terms
of
Union
and
are
hereinafter
referred
to
as
‘‘
Bowater’s
law.”
We
are
in
this
reference
in
the
main
concerned
with
the
provisions
of
the
1927
and
1938
agreements
under
which
it
was
provided
that
Bowater’s
Company
"‘in
respect
of
its
income
for
each
year’’
should
pay
a
tax
between
the
years
1932
and
1973
not
to
exceed
the
sum
of
$150,000
per
year;
that
apart
from
an
exemption
not
material
hereto,,
upon
payment
of
that
tax
"‘the
Company
shall
be
exempt
from
all
taxation
of
every
kind
whatsoever
other
than
duties
(including
Sales
Tax)
levied
under
the
general
laws
of
the
Colony
on
goods
imported
by
the
Company
and
not
otherwise
exempt.
’
’
These
words
‘‘not
otherwise
exempt
‘
’
refer
to
provisions
under
the
agreements
whereby
Bowater’s
were
granted
exemptions
from
customs
duties,
completely
or
partially,
upon
specified
commodities
for
varying
periods.
Under
the
authority
of
18(2)
of
the
Terms
of
Union
(hereinafter
quoted)
the
Governor
General
in
Council
proclaimed
as
of
April
1,
1949,
the
Customs
Act,
the
Tariff
Act
and
other
named
statutes,
and
by
a
further
proclamation
of
May
9,
1949,
the
Income
War
Tax
Act
and
other
named
statutes
were
brought
into
force
as
of
May
16,
1949,
in
the
Province
of
Newfoundland
and
certain
pre-Union
statutes
of
Newfoundland
were
specifically
repealed
by
each
of
these
proclamations.
Bowater’s
law
was
not
included
as
it
did
not
come
within
the
terms
of
18(2)
(a),
(b)
and
(c)
and
therefore
could
not
be
dealt
with
by
proclamation.
These
provisions
of
18(2)
(a),
(b)
and
(c),
however,
do
not
apply
to
statutes
enacted
by
the
Parliament
of
Canada.
Later
in
1949,
the
Parliament
of
Canada
amended
the
Income
War
Tax
Act
and
these
amendments
came
into
force
December
10,
1949
(S.
of
C.,
2nd
Sess.
1949,
e.
25).
The
amendments
relative
to
this
discussion
are
secs.
49
and
50:
1149.
For
greater
certainty
it
is
hereby
declared
and
enacted
that,
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada
(including
a
law
of
Newfoundland
enacted
prior
to
the
first
day
of
April
nineteen
hundred
and
forty-
nine)
no
person
is
entitled
to
(a)
any
deduction,
exemption
or
immunity
from,
or
any
privilege
in
respect
of,
(i)
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada
or
(ii)
any
obligation
under
an
Act
of
the
Parliament
of
Canada
imposing
any
duty
or
tax,
or
(b)
any
exemption
or
immunity
from
any
provision
in
an
Act
of
the
Parliament
of
Canada
requiring
a
licence,
permit
or
certificate
for
the
export
or
import
of
goods,
unless
provision
for
such
deduction,
exemption,
immunity
or
privilege
is
expressly
made
by
the
Parliament
of
Canada.
"50.
Notwithstanding
anything
contained
in
this
or
any
other
Act
an
exemption
from
taxation
provided
for
in
an
international
treaty
or
international
agreement
binding
on
Newfoundland
before
the
union
of
Newfoundland
with
Canada
may
be
extended
by
regulation
of
the
Governor
in
Council
to
taxation
by
or
under
any
Act
of
the
Parliament
of
Canada/’
The
amendments
in
sec.
49
are
intended
to
repeal
pro
tanto
Bowater’s
law
and
as
a
consequence
the
three
questions
under
consideration
were
submitted
to
this
Court.
The
answers
thereto
are
dependent
upon
the
meaning
and
effect
of
the
Terms
of
Union.
The
procedure
contemplated
by
sec.
146
of
the
B.N.A.
Act
for
the
admission
of
Newfoundland
into
Confederation
was
not
followed
as
at
all
times
material
to
negotiation
and
conclusion
of
the
Terms
of
Union
Newfoundland
was
governed
by
a
commission.
The
Terms
of
Union
were
negotiated
and
signed
by
representatives
of
both
Newfoundland
and
the
Dominion
of
Canada
and
were
made
a
schedule
to
legislation
approving
it
in
Canada
(S.
of
C.
1949,
c.
1),
and
Great
Britain
(12
&
13
Geo.
VI,
ce.
22).
This
approval
gives
to
every
clause
of
the
agreement
statutory
validity:
Manchester
Ship
Canal
Co.
v.
Manchester
Racecourse
Co.,
[1901]
2
Ch.
37,
at
p.
50;
31
Hals.,
2nd
ed.,
p.
465,
paras.
569
and
571;
International
Rly.
Co.
v.
Niagara
Parks
Comm.,
[1937]
3
All
E.R.
181,
at
p.
184.
The
Terms
of
Union
contain
the
following
paragraph:
°
3.
The
British
North
America
Acts,
1867
to
1946,
shall
apply
to
the
Province
of
Newfoundland
in
the
same
way,
and
to
the
like
extent
as
they
apply
to
the
provinces
heretofore
comprised
in
Canada,
as
if
the
Province
of
Newfoundland
had
been
one
of
the
provinces
originally
united,
except
in
so
far
as
varied
by
these
Terms
and
except
such
provisions
aS
are
in
terms
made
or
by
reasonable
intendment
may
be
held
to
be
specially
applicable
to
or
only
to
affect
one
or
more
and
not
all
of
the
provinces
originally
united.
’
’
Then
under
the
general
heading
‘‘
Continuation
of
Laws
‘
‘
para.
18
reads
as
follows
:—
4
"
18.
(1)
Subject
to
these
Terms,
all
laws
in
force
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union
shall
continue
therein
as
if
the
Union
had
not
been
made,
subject
nevertheless
to
be
repealed,
abolished,
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland
according
to
the
authority
of
the
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946,
and
all
orders,
rules,
and
regulations
made
under
any
such
laws
shall
likewise
continue,
subject
to
be
revoked
or
amended
by
the
body
or
person
that
made
such
orders,
rules,
or
regulations
after
the
date
of
Union,
according
to
their
respective
authority
under
the
British
North
America
Acts,
1867
to
1946.
(2)
Statutes
of
the
Parliament
of
Canada
in
force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
Province
of
Newfoundland
on
a
day
or
days
to
be
fixed
by
Act
of
the
Parliament
of
Canada
or
by
proclamation
of
the
Governor
General
in
Council
issued
from
time
to
time,
and
any
such
proclamation
may
provide
for
the
repeal
of
any
of
the
laws
of
Newfoundland
that
(a)
are
of
general
application
;
(b)
relate
to
the
same
subject-matter
as
the
statute
or
part
thereof
so
proclaimed;
and
(c)
could
be
repealed
by
the
Parliament
of
Canada
under
paragraph
one
of
this
Term.
(3)
Notwithstanding
anything
in
these
Terms
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.
(4)
Except
as
otherwise
provided
by
these
Terms
all
courts
of
civil
and
criminal
jurisdiction
and
all
legal
commissions,
powers,
authorities,
and
functions,
and
all
officers
and
functionaries,
judicial,
administrative,
and
ministerial,
existing
in
Newfoundland
at
or
immediately
prior
to
the
date
of
Union,
shall
continue
in
the
Province
of
Newfoundland
as
if
the
Union
had
not
been
made,
until
altered,
abolished,
revoked,
terminated,
or
dismissed
by
the
appropriate
authority
under
the
British
North
America
Acts
2
1867
to
1946.’’
On
behalf
of
the
Dominion
it
is
pointed
out
that
sub-paras.
(1)
and
(4)
of
para.
18
are
in
effect
identical
with
the
relevant
portions
of
sec.
129
of
the
B.N.A.
Act
and
are
enacted
in
respect
of
all
laws
in
force
in
Newfoundland
at
the
time
of
the
Union.
Further,
that
sub-para.
18(1)
continues
Bowater’s
law
in
force
and
provides
for
its
repeal,
abolition
or
alteration;
that
sec.
49
of
the
Income
War
Tax
Act
(S.
of
C.
1949,
2nd
Sess.,
e.
25,
secs.
49
and
50)
is
competent
Dominion
legislation
which
specifically
refers
to
a
law
enacted
prior
to
the
1st
day
of
April,
1949,
in
Newfoundland
and
goes
on
to
provide
that
no
person
is
entitled
to
any
deductions,
exemption,
immunity
from
or
any
privilege
in
respect
of
Dominion
duties
or
taxes
as
therein
specified.
On
behalf
of
Bowater’s
it
is
contended
that
when
para.
18
in
the
Terms
of
Union
is
read
and
construed
as
a
unit
that
the
meaning
and
purpose
of
sub-para.
18(3)
can
only
be
given
effect
to
if
the
pre-Union
laws
of
Newfoundland
are
divided
into
three
categories:
"
(a)
those
which
fall
clearly
within
the
Dominion
field
under
the
B.N.A.
Act
and
are
subject
to
be
repealed,
abolished
or
altered
by
the
Federal
Parliament;
"‘(b)
those
which
fall
clearly
within
the
Provincial
field
and
are
subject
to
be
repealed,
abolished
or
altered
by
a
provincial
Legislature
;
"(c)
those
not
falling
within
either
of
the
categories
(a)
or
(b)
but
which
are
of
mixed
subject-matter
and
inseverable
such
as
the
Bowater’s
law,
which
is
a
law
in
which
matters
under
Dominion
and
Provincial
control
are
so
interwoven
as
to
constitute
an
indissoluble
mixture
of
consideration
flowing
to
and
from
Bowaters
as
to
be
inseverable.
’
’
Counsel
for
Bowaters
submits
that
laws
classified
within
the
foregoing
paras.
(a)
and
(b)
are
dealt
with
under
sub-
-para.
18(1)
and
those
within
(c)
under
sub-para.
18(3)
;
further,
that
Bowater’
s
law
is
of
"‘mixed
subject-matter,’’
in
its
nature
"indivisible
or
incapable
of
severance’’
and
as
such
is
classified
under
para.
(c)
and
therefore
dealt
with
only
under
sub-para.
18(3).
It
is
further
contended
that
in
any
event
the
enactment
of
the
above
quoted
sec.
49
did
not
repeal
any
part
of
Bowater’s
law.
It
was
submitted
that
inasmuch
as
the
statute
in
Great
Britain
confirming
the
Terms
of
Union
provided
"The
Agreement
containing
Terms
of
Union
between
Canada
and
Newfoundland
.
.
.
shall
have
the
foree
of
law
notwithstanding
anything
in
the
British
North
America
Acts,
1867
to
1946,’’
that
in
the
construction
of
the
Terms
of
Union
no
regard
should
be
had
to
the
provisions
of
the
B.N.A.
Acts,
1867
to
1946.
The
Canadian
statute
approving
the
agreement
did
not
include
any
such
provision.
These
differences
in
the
respective
enactments,
the
express
provisions
of
para.
3
that
the
B.N.A.
Acts,
1867
to
1946,
"‘shall
apply
to
the
Province
of
Newfoundland
.
.
.
except
in
so
far
as
varied
by
these
Terms,’’
the
repeated
references
to
the
B.N.A.
Act
in
the
Terms
of
Union,
together
with
the
fact
that
Newfoundland
could
not
in
the
circumstances
be
admitted
as
contemplated
by
sec.
146
of
the
B.N.A.
Act,
suggest
that
the
words
in
the
above
mentioned
British
statute
were
inserted
to
remove
any
question
that
might
arise
out
of
the
procedure
followed
not
being
that
provided
for
in
sec.
146
rather
than
that
in
the
construction
of
the
Terms
of
Union
no
regard
should
be
had
to
any
provisions
of
the
B.N.A.
Act,
1867
to
1946.
The
B.N.A.
Act
divides
the
entire
legislative
field
between
the
Parliament
of
Canada
and
the
legislatures
of
the
provinces,
or
as
it
is
stated
by
Lord
Hobhouse
:
H
an
Act
of
Parliament
which
makes
an
elaborate
distribution
of
the
whole
field
of
legislative
authority
between
two
legislative
bodies
.
.
.”
Bank
of
Toronto
v.
Lambe
(1887),
12
App.
Cas.
575,
at
p.
587;
1
Cam.
378,
at
p.
388.
See
also
A.-G.
for
Ontario
v.
A.-G.
for
Canada,
[1912]
A.C.
571,
at
p.
581
;
1
Cam.
723,
at
p.
732.
The
B.N.A.
Act
therefore
defines
the
legislative
power
and
authority
of
the
Dominion
and
the
provinces
to
enact
legislation.
It
has,
however,
been
determined
that
the
power
to
repeal
is
co-extensive
with
that
to
enact.
Dobie
v.
Temporalities
Board,
8
A.C.
136
;
1
Cam.
293
;
A.-G.
for
Ontario
v.
A.-G.
for
Dominion,
[1896]
A.C.
348;
1
Cam.
481;
[1917-27]
C.T.C.
82.
The
respective
jurisdictions
of
the
Dominion
and
the
province
in
respect
to
pre-Confederation
legislation
was
considered
by
the
Privy
Council
in
A.-G.
for
Canada
v.
A.-G.
for
Quebec,
[1921]
1
A.C.
413;
2
Cam.
198.
The
particular
legislation
there
in
question
was
enacted
in
1865,
(29
Vict.,
ec.
11),
and
therefore
prior
to
Confederation,
by
the
Parliament
of
Upper
and
Lower
Canada.
After
Confederation
the
Parliament
of
Canada
by
sec.
20
of
the
Fisheries
Act
(S.
of
C.
1868,
c.
60)
repealed
the
legis-
lation
of
1865.
It
did
not,
however,
follow
that
all
of
the
powers
exercised
by
Lower
Canada
became
thereby
vested
in
the
Dominion.
Referring
particularly
to
sec.
3
of
the
pre-Confedera-
tion
Act
of
1865
their
Lordships
stated:
“As
to
s.
3
of
the
Act
of
1865,
which
enables
the
Commissioner
of
Crown
Lands,
where
the
exclusive
right
of
fishing
does
not
exist
by
law
in
favour
of
private
persons,
to
issue
fishing
leases
and
licenses
for
fisheries
and
fishing
wherever
carried
on,
this
was
obviously
within
the
competence
of
the
Legislature
which
was
then
unrestricted
in
the
scope
of
its
power
to
alter
the
provincial
law.
No
distinction
was,
or
needed
to
be,
contemplated
between
power
of
regulation
and
power
over
proprietary
title.
Bearing
this
in
mind,
their
Lordships
think
that
s.
3
was
in
its
character
as
much
a
regulative
provision
as
it
was
one
directed
to
property.
These
two
aspects
of
its
subject-matter
were
really
then
inseparable.
In
so
far
as
its
powers
were
powers
of
regulation,
they
have
passed
to
the
Dominion
Parliament
.
.
.
the
disposal
of
property
and
the
exercise
of
the
power
of
regulation.
The
former
of
these
functions
has
now
fallen
to
the
Province,
but
the
latter
to
the
Dominion;
and
accordingly
the
power
which
existed
under
s.
3
of
the
Act
of
1865
no
longer
exists
in
its
entirety.
‘
‘
This
illustrates
how
completely
the
field
of
legislation
is
divided
between
the
Dominion
and
the
province
and
the
necessity
of
careful
examination
of
the
statute
and
of
the
individual
sections
thereof
in
order
to
determine
whether
a
particular
provision
should
be
classified
as
within
the
Dominion
or
provincial
legislative
field
within
the
meaning
of
the
B.N.A.
Act.
In
re
New
Brunswick
Penitentiaries,
Coutlee's
S.C.
Cas.
24,
this
Court
held
that
legislation
enacted
relative
to
penitentiaries
by
the
Parliament
of
Canada
superseded
legislation
passed
by
New
Brunswick
prior
to
Confederation
and
continued
in
force
in
that
province
after
Confederation
by
virtue
of
sec.
129
of
the
B.N.A.
Act.
The
foregoing
decisions
were
made
under
the
B.N.A.
Act
of
1867
and
indicate
how
pre-Confederation
legislation
has
been
treated.
It
is
not
contended
that
the
legislative
division
set
forth
in
the
foregoing
paras.
(a),
(b)
and
(c)
exists
under
sec.
129
of
the
B.N.A.
Act,
sec.
16
of
the
Alberta
and
Saskatchewan
Acts,
or
under
any
of
the
express
terms
to
be
found
in
the
admission
of
any
other
province.
It
would
seem,
therefore,
that
if
in
the
Terms
of
Union
it
was
intended
to
introduce
such
a
classification
and
to
effect
so
radical
a
change
in
the
construction
of
18(1)
by
the
inclusion
of
18(3),
appropriate
language
would
have
been
used
to
express
that
intention
in
either
one
or
both
of
sub-paras.
(1)
and
(3);
on
the
contrary,
18(1)
is
expressed
in
clear
and
comprehensive
language
without
any
exception
or
limitation
and
no
such
division
is
suggested
in
either
that
sub-para.
or
sub-para.
(3).
Moreover,
the
acceptance
of
this
submission
on
behalf
of
Bowaters
would
impose
a
limitation
upon
the
Parliament
of
Canada
to
the
extent
that
competently
enacted
legislation
so
far
as
it
would
be
contrary
to
the
pre-Confederation
Bowater’s
law
could
have
no
application
to
that
company
until
such
time
as
Newfoundland
would
give
its
consent
to
the
repeal
of
Bowater’s
law.
In
effect
the
exemptions
from
taxation
and
payment
of
certain
customs
duties
provided
for
in
Bowater’s
law
would
remain
until
such
time
as
Newfoundland
permits
the
Parliament
of
Canada
to
legislate
in
regard
thereto.
No
similar
provision
was
embodied
in
the
Terms
of
Union
of
any
other
province,
and
while
that
is
not
at
all
conclusive,
it
is
significant
in
this
sense,
that
a
provision
so
important,
far
reaching
and
contrary
to
the
general
scheme
of
legislative
jurisdiction
under
the
B.N.A.
Act
would
have
been
expressed
in
language
clear
and
unambiguous.
Sub-para.
3
contains
no
such
language.
Indeed,
its
language
as
ordinarily
construed
does
not
suggest
that
the
legislative
authority
of
either
the
Dominion
or
the
province
is
interfered
with.
The
opening
words
of
sub-para.
18(3)
"‘notwithstanding
anything
in
these
Terms,’’
together
with
its
express
provision
that
it
applies
to
""any
law
in
force
at
the
date
of
the
Union”
indicates
that
its
provisions
are
by
way
of
an
exception
to
the
general
provisions
of
the
Terms
of
Union
rather
than
as
submitted
a
provision
to
deal
with
a
third
(para,
(c),
supra),
classification
of
legislation.
The
language
of
18(1)
is
general
and
all-embracing:
That
of
18(3)
provides
that
notwithstanding
all
that
has
been
provided
"‘the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law.”
These
sub-paras.
18(1)
and
(3)
when
read
and
construed
together
do
not
support
a
construction
that
they
are
dealing
with
separate
and
distinct
portions
of
a
general
classification
of
legislation
such
as
submitted
by
Bowaters
in
paras.
(a),
(b)
and
(c).
Bowater’s
law
is
not
mentioned
in
sub-para.
18(3)
nor
in
any
other
section
throughout
the
Terms
of
Union.
The
absence
of
any
specific
reference
to
this
law
or
any
group
or
type
of
laws
in
which
it
might
be
included
rather
suggests
that
the
classification
of
legislation
such
as
here
submitted
was
not
intended
but
rather
that
all
legislation
should
be
subject
to
the
provisions
of
18(1).
It
may
be
implicit
in
the
submission
for
Bowaters
that
neither
the
Dominion
nor
the
Province
of
Newfoundland
can
legislate
with
respect
to
Bowater’s
law
until
such
time
as
the
province
shall
consent
to
its
repeal
by
the
Parliament
of
Canada
under
sub-para.
18(3).
The
difficulty
is
to
find
language
to
support
such
a
view.
Whatever
opinion
one
may
entertain
of
the
submission
with
respect
to
the
suggested
construction
of
sub-para.
18(3)
in
its
application
to
the
Dominion
it
does
not
contain
language
that
suggests
any
such
limitation
upon
provincial
enactments.
It
would
therefore
appear
that
the
province
might
repeal,
abolish
or
alter
any
part
of
Bowater’s
law
classified
within
provincial
legislation.
Para.
24
of
the
1938
Bowater’s
law
that
‘‘all
property
of
the
company
within
the
area
of
any
towns
or
settlements
established
by
the
company
shall
be
exempt
from
municipal
taxation’’
is
such
a
provision.
If
it
was
intended
that
the
province
in
respect
of
Bowaters
should
not
possess
the
power
to
legislate
within
its
jurisdiction,
again
appropriate
language
to
that
effect
would
have
been
included.
Its
omission
rather
supports
the
view
that
it
was
intended
both
the
representatives
in
Parliament
and
the
Legislature
would
legislate
in
their
respective
fields
without
any
limitation
such
as
that
involved
in
the
submission
on
behalf
of
Bowaters.
Counsel
for
Bowaters
further
contends
that
if
Bowater’s
law
comes
within
the
provisions
of
sub-para.
18(1)
the
Parliament
of
Canada
cannot
repeal
that
law
as
it
has
purported
to
do
by
the
enactment
of
sec.
49
of
the
Income
War
Tax
Act,
supra.
It
is
here
contended
that
Bowater’s
law
is
indivisible
or
incapable
of
severance
and
therefore
its
provisions
cannot
be
divided
between
the
Dominion
and
the
province
as
contemplated
by
the
B.N.A.
Act
and
cannot
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada.
This
impossibility,
as
I
understand
it,
is
not
because
the
provisions
of
Bowater’s
law
cannot
be
allocated
to
the
respective
Dominion
and
provincial
legislative
jurisdictions
but
rather
that
the
subject-matters
of
that
legislation
are
so
"‘inextricably
interwoven
into
what
constitutes
a
single
Newfoundland
law”
that
it
"‘must
be
regarded
as
comprising
the
terms
of
a
single
contract
which
has
been
confirmed
and
given
the
force
of
law
by
legislation,”
that
to
do
so
in
effect
destroys
it
or
makes
it
something
entirely
different.
It
is
not
contended
that
Newfoundland
prior
to
Union
had
not
the
jurisdiction
to
repeal
the
whole
or
any
part
of
Bowater’s
law,
but
though
the
legislative
jurisdiction
of
Newfoundland
was
under
the
Terms
of
Union
completely
divided
between
the
Parliament
of
Canada
and
the
legislature
of
the
province,
neither
acting
independently
can
now
repeal
Bowater’s
law.
Bowater’s
law,
as
already
stated,
is
pre-Union
legislation
enacted
by
a
political
entity
that
no
longer
exists
and
is
carried
forward
as
legislation
in
force
in
the
Province
of
Newfoundland
by
virtue
of
sub-para.
18(1)
of
the
Terms
of
Union.
Under
the
B.N.A.
Act
the
entire
legislative
field
is
divided
between
the
Dominion
and
the
province.
Bank
of
Toronto
v.
Lambe,
supra,
or
as
stated
by
Earl
Loreburn,
L.C.:
"cc
.
the
powers
distributed
between
the
Dominion
on
the
one
hand
and
the
provinces
on
the
other
hand
cover
the
whole
area
of
self-government
within
the
whole
area
of
Canada.’’
A.-G.
for
Ontario
v.
A.-G.
for
Canada,
supra,
at
p.
581.
The
Terms
of
Union
under
sub-para.
18(1)
provide
that
all
pre-Union
legislation
continued
in
force
in
the
Province
of
Newfoundland
shall
be
divided
as
provided
in
the
B.N.A.
Act.
Under
this
provision
Bowater’s
law
is
subject
"
4
to
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
the
Legislature
of
the
Province
of
Newfoundland’’
legislating
within
their
respective
jurisdictions
as
defined
under
the
B.N.A.
Act,
1867
to
1946.
In
fact,
the
provisions
in
respect
to
customs,
excise
and
income
legislation
here
in
question
are
clearly
within
the
legislative
jurisdiction
of
the
Parliament
of
Canada.
The
principle
applied
in
the
Dobie
case,
supra,
that
the
power
to
repeal
is
co-extensive
with
the
power
to
enact
is
applicable
to
Bowater’s
law.
It,
however,
applies
once
the
respective
jurisdictions
of
the
Dominion
and
the
province
are
determined
but
does
not
assist
in
the
determination
thereof.
It
does
not
suggest
that
because
the
statute
cannot
be
entirely
repealed
by
either
the
Dominion
or
a
province
that
either
cannot
repeal
or
amend
that
portion
of
the
statute
which
is
within
its
legislative
jurisdiction.
The
fact
that
such
legislative
action
on
the
part
of
one
or
the
other
may
create
difficulties
to
be
subsequently
dealt
with
does
not
affect
the
question
of
jurisdiction.
Whatever
such
difficulties
may
be
will
no
doubt
in
due
course
be
dealt
with
by
the
appropriate
authorities,
but
those
are
not
matters
to
be
dealt
with
by
the
Courts,
particularly
when
as
here,
this
Court
is
called
upon
to
determine
only
the
question
of
jurisdiction.
Under
the
scheme
of
Confederation
and
under
the
Terms
of
Union
even
if
the
"‘rights
and
obligations
are
inextricably
interwoven
into
a
single
Newfoundland
law”
as
here
contended,
that
would
not
alter
or
affect
the
legislative
classification
of
the
various
portions
of
Bowater’s
law
nor
the
jurisdiction
of
either
the
Dominion
or
the
province
to
deal
therewith.
The
contention
that
the
provisions
of
Bowater’s
agreement
are
not
severable
as
that
term
has
been
used
in
regard
to
contracts
found
to
contain
provisions
in
restraint
of
trade
or
statutes
in
part
ultra
vires
of
the
enacting
body
are
not
relevant
to
this
discussion.
In
those
cases
when
a
portion
of
the
contract
or
statute
has
been
declared
invalid
the
question
arises
as
to
the
disposition
of
the
remaining
portion.
Hals.
2nd
ed.,
vol.
32,
p.
459;
A.-G.
for
Alberta
v.
A.-G.
for
Canada,
[1947]
A.C.
503,
at
p.
518.
Here
Bowater’s
law
as
confirmed
by
statute
is
entirely
valid
and
the
issue
quite
different.
We
are
here
first
concerned
with
the
law
as
a
whole
and
then
with
the
jurisdiction
of
the
Parliament
of
Canada
to
repeal
a
portion
thereof.
The
jurisdiction
of
Parliament
to
enact
legislation
must
be
determined
from
the
nature
and
character
of
the
legislation.
Any
statement
or
declaration
contained
therein
on
the
part
of
Parliament
as
to
its
jurisdiction
is
not
conclusive.
Once,
however,
the
jurisdiction
to
enact
the
legislation
is
found
to
exist,
the
language
thereof
must
be
examined
to
determine
the
meaning
and
intent
of
Parliament
in
enacting
the
same.
The
language
of
sec.
49,
supra,
while
it
makes
no
specific
reference
to
Bowater’s
law,
is
designed
to
and
does
cover
just
such
provisions
as
contained
in
that
law.
It
expressly
covers
any
such
legislation
in
all
of
the
provinces
and
specifically
covers
such
pre-Union
legislation
in
Newfoundland.
The
contention
that
sub-para.
18(1)
should
be
construed
to
apply
only
to
repeal,
abolition
or
alteration
when
the
statute
specifically
so
states
would
impose
an
unwarranted
limitation
upon
the
comprehensive
language
there
used.
The
foregoing
finds
support
in
the
principle
that
one
Parliament
cannot
bind
its
successors.
"That
Parliaments
have
more
than
once
intended
and
endeavoured
to
pass
Acts
which
should
tie
the
hands
of
their
successors
is
certain,
but
the
endeavour
has
always
ended
in
failure.
Dicey,
Law
of
the
Constitution,
9th
ed.,
p.
65.
If
it
were
not
for
this
principle
a
parliament
finding
itself
bound
by
the
legislation
of
its
predecessors
would
be
unable
to
discharge
that
imperative
duty
which
rests
upon
every
parliament
to
legislate
as
in
its
wisdom
it
may
determine
to
be
necessary
or
desirable.
The
enactment
of
the
foregoing
sec.
49
of
the
Income
War
Tax
Act
was
legislation
competently
enacted
by
the
Parliament
of
Canada
and
enforcible
as
regards
the
Bowater’s
Company,
notwithstanding
the
provisions
of
the
Bowater’s
law.
The
questions
here
submitted
should
be
answered
:
(1)
No.
(2)
No.
(3)
No.
I
HEREBY
CERTIFY
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
LOCKE,
J.:—At
the
date
of
the
entry
of
Newfoundland
into
Confederation
Bowater’s
Newfoundland
Pulp
and
Paper
Mills
Limited
was
subject
to
the
obligations
imposed
and
entitled
to
the
benefit
of
certain
rights
and
exemptions
granted
by
a
series
of
agreements
entered
into
by
it
and
its
predecessors
in
title
with
the
Dominion
of
Newfoundland,
and
by
a
series
of
statutes
by
which
they
were
confirmed.
The
company
carries
on
very
extensive
operations
in
the
manufacture
of
newsprint
and
sulphite
pulp
and
other
allied
activities
at
Cornerbrook
and
elsewhere
in
Newfoundland
and
has
extensive
timber
limits
in
the
Province.
The
agreements
were
made
and
the
statutes
which
approved
and
confirmed
then
and
gave
to
their
terms
the
force
of
law
were
enacted
at
various
times
between
the
years
1915
and
1946
and
dealt
with
a
variety
of
matters,
all
of
which
were
then
within
the
legislative
jurisdiction
of
the
Dominion.
Pursuant
to
and
relying
upon
these
agreements,
the
company
and
its
predecessors
have
invested
in
Newfoundland
some
$86,000,000.00
in
the
construction
and
equipping
of
manufacturing
plants,
the
establishment
of
towns
and
settlements,
the
development
of
water
power,
the
acquisition
of
timber
limits,
and
in
other
works
and
plant
necessary
for
the
carrying
on
of
its
activities.
In
consideration
of
the
undertaking
of
these
extensive
developments
which,
it
is
evident,
were
regarded
as
being
of
importance
and
benefit
to
the
state,
and
the
assumption
of
various
obligations
of
a
continuing
character
including
an
agreement
to
pay
to
the
Dominion
in
respect
of
its
income
for
each
year
beginning
with
the
year
1928
and
ending
with
the
year
1973
a
tax
of
twenty
per
cent
of
its
income,
limited
to
a
maximum
of
$75,000.00
for
the
years
1928
to
1931
inclusive
and
$150,000.00
for
each
of
the
years
1932
to
1973
inclusive,
the
Dominion
of
Newfoundland
by
the
said
agreements
and
by
the
various
statutes
undertook,
inter
alia,
that
the
stocks,
shares,
bonds,
debentures
and
other
securities
of
the
company
and
the
dividends
or
interest
payable
in
respect
of
them
and
the
receipt
of
the
same
by
holders
domiciled
in
Newfoundland
(with
certain
named
exceptions)
should
be
exempt
from
taxation
until
the
year
1977,
that
certain
described
goods
and
commodities
imported
by
the
company
should
be
free
of
customs
duties
and
others
subjected
to
duties
limited
in
amount,
and
that
all
its
property
within
the
area
of
towns
and
settlements
established
by
it
should
be
exempt
from
municipal
taxation.
By
section
146
of
the
British
North
America
Act
of
1867,
provision
was
made
for
the
admission
of
Newfoundland,
Prince
Edward
Island
and
British
Columbia
into
the
Union
on
addresses
from
the
Houses
of
Parliament
of
Canada
and
of
the
respective
legislatures
of
what
were
referred
to
as
the
Colonies
or
Provinces
‘
‘
on
such
terms
and
conditions
in
each
ease
as
are
in
the
addresses
expressed
and
as
the
Queen
thinks
fit
to
approve,
subject
to
the
provisions
of
this
Act;
and
the
provisions
of
any
Order-in-
Council
in
that
behalf
shall
have
effect
as
if
they
had
been
enacted
by
the
Parliament
of
the
United
Kingdom
of
Great
Britain
and
Ireland.’’
In
the
case
of
the
Provinces
of
Canada,
Nova
Scotia
and
New
Brunswick,
the
union
of
which
was
effected
by
the
Act,
section
129
provided
that
all
laws
in
force
in
these
provinces
at
the
time
of
Union
:—
"‘shall
continue
in
Ontario,
Quebec,
Nova
Scotia
and
New
Brunswick
respectively
as
if
the
Union
had
not
been
made;
subject
nevertheless
(except
with
respect
to
such
as
are
enacted
by
or
exist
under
Acts
of
the
Parliament
of
the
United
Kingdom
of
Great
Britain
and
Ireland)
to
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
by
the
legislature
of
the
respective
provinces
according
to
the
authority
of
the
Parliament
or
of
that
legislature
under
this
Act.’’
When
Newfoundland
sought
to
enter
the
Union
it
had
no
legislature,
the
power
to
enact
laws
having
since
the
coming
into
operation
of
letters
patent
granted
by
His
Majesty
on
January
30th,
1934,
been
vested
in
the
Governor
and
the
Commission
of
Government
which
it
authorized.
In
these
circumstances,
the
Union
was
brought
about
by
amendment
to
the
British
North
America
Act
passed
in
1949
which,
by
section
1,
provided
that:—
‘‘The
agreement
containing
terms
of
Union
between
Canada
and
Newfoundland
set
out
in
the
schedule
to
this
Act
is
hereby
confirmed
and
shall
have
the
force
of
law
notwithstanding
anything
in
the
British
North
America
Acts
1867
to
1946.’’
Section
3
of
the
Terms
of
Union
provides
that
the
British
North
America
Acts
1867
to
1946
shall
apply
to
the
new
province
in
the
same
way
and
to
the
like
extent
as
they
apply
to
the
provinces
heretofore
comprised
in
Canada
“except
in
so
far
as
varied
by
these
Terms
and
except
such
provisions
as
are
in
terms
made
or,
by
reasonable
intendment,
may
be
held
to
be
specially
applicable
to
or
only
to
affect
one
or
more
and
not
all
of
the
provinces
originally
united/
‘
Subsections
1
and
4
of
section
18
of
the
Terms
of
Union
repeat
in
substance
section
129
of
the
Act
of
1867,
with
the
substitution
of
Newfoundland
for
the
names
of
the
former
provinces
which
then
entered
the
Union.
Section
18
contained,
however,
the
following
further
provisions
governing
the
alterations
of
the
laws
of
the
new
Province
which
are
not
to
be
found
in
the
British
North
America
Act,
or
in
any
of
its
amendments
made
prior
to
March
31st,
1949,
or
in
the
Terms
of
Union
under
which
British
Columbia
and
Prince
Edward
Island
entered
Confederation,
or
the
statutes
which
established
the
Provinces
of
Manitoba,
Alberta
and
Saskatchewan.
These
provisions
read
:—
"‘(2)
Statutes
of
the
Parliament
of
Canada
in
force
at
the
date
of
Union,
or
any
part
thereof,
shall
come
into
force
in
the
Province
of
Newfoundland
on
a
day
or
days
to
be
fixed
by
Act
of
the
Parliament
of
Canada
or
by
proclamation
of
the
Governor
General
in
Council
issued
from
time
to
time,
and
any
such
proclamation
may
provide
for
the
repeal
of
any
of
the
laws
of
Newfoundland
that
(a)
are
of
general
application
;
(b)
relate
to
the
same
subject-matter
as
the
statute
or
part
thereof
so
proclaimed;
and
(c)
could
be
repealed
by
the
Parliament
of
Canada
under
paragraph
one
of
this
Term.
(3)
Notwithstanding
anything
in
these
Terms,
the
Parliament
of
Canada
may
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
repeal
any
law
in
force
in
Newfoundland
at
the
date
of
Union.
‘
‘
By
an
amendment
to
the
Income
Tax
Act
and
Income
War
Tax
Act
(sec.
49,
cap.
25,
13
Geo.
VI),
it
was
provided
that
notwithstanding
any
other
law
heretofore
enacted
by
a
legislative
authority
other
than
the
Parliament
of
Canada,
including
a
law
of
Newfoundland
enacted
prior
to
the
1st
day
of
April,
1949,
no
person
shall
be
entitled
to
any
exemption
or
immunity
from
or
any
privilege
in
respect
of
any
duty
or
tax
imposed
by
an
Act
of
the
Parliament
of
Canada.
By
a
proclamation
made
on
April
1st,
1949,
the
Customs
Act
and
the
Customs
Tariff
Act
were
declared
to
be
in
force
in
the
new
province
as
of
that
date,
and
by
a
further
proclamation
of
May
9th,
1949,
the
Income
Tax
Act
was
declared
to
be
in
force
on
the
date
of
the
publication
of
the
proclamation.
These
proclamations
are
in
terms
stated
to
be
made
under
the
provisions
of
paragraph
2
of
Term
18.
The
amendment
to
the
Income
Tax
Act
was
not
one
made
with
the
consent
of
the
Legislature
of
the
Province
of
Newfoundland
under
the
provisions
of
subsection
3
of
section
18.
If
the
legislation
is
effective,
a
substantial
part
of
the
consideration
which
the
agreements
and
the
confirming
statute
provided
should
move
from
Newfoundland
to
the
company
and
upon
the
faith
of
which
the
latter
and
its
predecessors
entered
into
the
agreements,
expended
these
large
sums
of
money
and
undertook
these
continuing
obligations,
would
be
taken
away.
Newfoundland
was
prior
to
its
entry
into
Confederation
a
unitary
state
:
the
property
and
revenues
of
the
Dominion
were
vested
in
the
Sovereign,
subject
to
the
disposal
and
appropriation
of
the
Governor
and
the
Commission
of
Government.
It
cannot
be
successfully
contended
that
by
amending
or
repealing
the
statutes
which
confirmed
and
gave
the
force
of
law
to
the
various
agreements
made
between
the
company
and
the
Dominion
these
might
not
have
been
either
amended
or
terminated.
Upon
such
entry,
however,
the
powers,
executive
and
legislative,
and
the
right
to
dispose
of
the
said
revenues
were
distributed
between
the
new
Province
and
Canada
in
the
manner
defined
by
sections
91
and
92
of
the
British
North
America
Act,
subject,
however,
to
the
terms
of
the
amendment
of
1949.
Since
the
statutes
in
question
confer
rights
such
as
the
exemption
from
municipal
taxation
and
all
other
provincial
taxation,
which
are
matters
lying
entirely
within
the
jurisdiction
of
the
province,
and
at
the
same
time
grant
exemptions
from
custom
duties
and
taxation
of
a
nature
lying
entirely
within
the
jurisdiction
of
the
Dominion,
the
question
to
be
determined
is
whether
by
unilateral
action
the
Dominion
may
‘‘repeal’’
or
alter
the
statutes
or
the
law
as
declared
by
them
relating
to
matters
clearly
falling
within
section
91.
The
amendment
to
the
Income
Tax
Act
of
1949
and
the
terms
of
the
Customs
Act
and
the
Customs
Tariff
Act
of
Canada
are
repugnant
to
the
terms
of
the
statutes
of
Newfoundland
dealing
with
these
matters
which
have
been
referred
to.
Parliament
has
not
assumed
to
repeal
the
statutes
in
toto
but
merely
to
amend
the
law
as
declared
by
them
in
respect
to
matters
within
the
jurisdiction
of
Parliament.
In
determining
the
question
no
assistance
is
obtained
from
what
transpired
in
the
years
immediately
following
the
Act
of
Union
of
1867.
Parliament
at
that
time
by
a
series
of
enactments
assumed
to
repeal
in
whole
or
in
part
a
large
number
of
statutes
of
the
former
Provinces
of
Canada,
Nova
Scotia
and
New
Brunswick,
but
its
power
to
do
so
was
not
questioned.
In
1880
there
was
a
reference
to
this
Court
in
Re
New
Brunswick
Penitentiary,
reported
in
Coutlee’s
Supreme
Court
Cases,
page
24,
to
determine
whether
the
legislative
jurisdiction
of
the
Parliament
of
Canada
in
respect
of
the
establishment,
maintenance
and
management
of
penitentiaries
could
in
any
way
be
limited,
restricted
or
affected
by
legislation
of
the
Province
of
New
Brunswick,
either
previous
or
subsequent
to
Confederation.
It
was
there
held
that
since
Canada
had
the
exclusive
power
of
legislation
in
reference
to
criminal
law,
except
the
constitution
of
courts
of
criminal
jurisdiction
but
including
procedure
in
criminal
matters
and
also
as
to
the
establishment,
maintenance
and
management
of
penitentiaries,
Parliament
alone
was
vested
with
power
to
decide
what
classes
of
prisoners
should
be
imprisoned
and
maintained
in
the
penitentiary.
I
refer
to
the
case
since
it
was
contended
that
it
gave
some
support
to
the
position
of
Canada
in
the
present
matter.
However,
I
find
nothing
in
the
decision
which
is
of
assistance
in
determining
the
present
questions
and,
so
far
as
I
can
discover,
there
is
no
decision
binding
upon
us
affecting
them
until
the
decision
of
the
Judicial
Committee
in
Dobie
v.
The
Temporalities
Board
(1881),
7
A.C.
136.
The
decision
of
the
main
point
in
that
matter
turned
upon
the
proper
interpretation
to
be
placed
on
section
129
of
the
British
North
America
Act,
1867,
and
that
section
is
not
to
be
distinguished
from
subsections
1
and
4
of
section
18.
Much
reliance
has
been
placed
by
the
company
upon
the
provisions
of
subsection
3
of
section
18
but,
other
than
as
an
indication
that
the
parties
responsible
for
the
drafting
of
the
terms
were
of
the
opinion
that
there
were
laws
in
force
in
Newfoundland
relating
to
matters
within
federal
jurisdiction,
the
repeal
or
amendment
of
which
would
require
the
consent
of
the
new
Province,
I
think
the
subsection
does
not
affect
the
matter.
The
facts
in
Dobie’s
case
are
fully
stated
elsewhere
and
need
not
be
here
repeated.
Lord
Watson’s
judgment,
at
page
147,
says
that,
in
order
to
ascertain
how
far
the
Provincial
Legislature
of
Quebec
had
power
to
alter
or
amend
the
Act
of
the
Province
of
Canada
passed
in
1858,
it
was
necessary
to
consider
whether
it
could
be
established
that
in
the
absence
of
all
previous
legislation
on
the
subject
the
Quebec
Legislature
would
have
been
authorized
by
section
92
to
pass
an
Act
identical
in
its
terms
and
that,
if
it
could
not
do
so,
it
could
not
repeal
or
alter
the
statute
of
1858.
The
statement
is,
however,
amplified
and
explained
by
what
follows.
In
a
later
passage
of
the
judgment,
after
pointing
out
that
the
Quebec
Act
of
1885
dealt
with
the
civil
rights
of
a
corporation
and
of
individuals,
present
or
future,
for
whose
benefit
it
was
created,
Lord
Watson
said
that
if
those
rights
and
interests
were
capable
of
division
according
to
their
local
position
in
Ontario
and
Quebec
respectively,
the
legislature
of
each
province
would
have
power
to
deal
with
them
so
far
as
situate
within
the
limits
of
its
authority,
and
then
said
(p.
150)
:—
"‘The
Quebec
Act
38
Vict.
c.
64
does
not
profess
to
repeal
and
amend
the
Act
of
1858,
only
in
so
far
as
its
provisions
may
apply
to
or
be
operative
within
the
province
of
Quebec,
and
its
enactments
are
apparently
not
framed
with
a
view
to
any
such
limitation.
The
reason
is
obvious,
and
it
is
a
reason
which
appears
to
their
Lordships
to
be
fatal
to
the
validity
of
the
Act.
The
corporation
and
the
corporate
trust,
the
matters
to
which
its
provisions
relate,
are
in
reality
not
divisible
according
to
the
limits
of
provincial
authority.
In
every
case
where
an
Act
applicable
to
the
two
provinces
of
Quebec
and
Ontario
can
now
be
validly
repealed
by
one
of
them,
the
result
must
be
to
leave
the
Act
in
full
vigour
within
the
other
province.
But
in
the
present
case
the
legislation
of
Quebec
must
necessarily
affect
the
rights
and
status
of
the
corporation
as
previously
existing
in
the
Province
of
Ontario,
as
well
as
the
rights
and
interests
of
individual
corporators
in
that
province.”
Thus
in
the
case
of
an
Act
of
the
Province
of
Canada
applicable
to
the
two
Provinces
of
Quebec
and
Ontario,
either
province,
though
it
could
not
have
enacted
it,
could
validly
repeal
it
in
so
far
as
it
applied
to
matters
within
its
own
legislative
jurisdiction,
so
long
as
it
was
left
in
full
vigour
in
the
other
province.
The
decision
in
Dobie
f
s
case
turned
upon
the
point
as
to
whether
the
Quebec
Act
in
question
dealt
with
matters
which
lay
outside
the
powers
given
to
the
Provinee
by
section
92
and,
as
it
dealt
with
the
constitution
and
privileges
of
a
company
having
its
corporate
existence
and
rights
in
Ontario
as
well
as
in
Quebec,
it
was
held
ultra
vires.
The
imposition
of
a
federal
income
tax
and
of
customs
duties
are
within
the
powers
vested
in
Parliament
by
section
91.
It
is
apparently
unfortunately
the
fact
that
in
the
present
matter
to
deprive
the
company
of
these
exemp-
tions
will
be
to
cause
virtually
a
frustration
of
the
contracts.
The
question,
however,
is
as
to
the
right
to
exercise
these
powers
and
not
the
consequences
of
such
exercise.
I
do
not
consider
that
the
decision
in
Dobie
9
s
case
affects
that
right,
or
that
it
is
otherwise
impaired
or
taken
away.
By
the
terms
of
subsection
1
of
section
18
of
the
Terms
of
Union
all
laws
in
force
in
Newfoundland
at
the
date
of
Union
are
to
continue,
subject
to
be
repealed,
abolished
or
altered
by
the
Parliament
of
Canada
or
by
the
Legislature
of
the
Province
of
Newfoundland,
according
to
the
authority
of
Parliament
or
of
the
Legislature
under
the
British
North
America
Acts,
1867
to
1946.
In
enacting
the
amendment
to
the
Income
Tax
Act
and
proclaiming
the
Customs
and
the
Customs
Tariff
Act
and
other
statutes
dealing
with
matters
admittedly
within
federal
jurisdiction
and
which
are
repugnant
to
the
terms
of
the
statutes
in
question,
Canada
has,
in
my
opinion,
altered
the
law
as
declared
by
them
by
a
valid
exercise
of
its
powers
under
the
British
North
America
Act
and
the
Terms
of
Union.
I
would,
therefore,
answer
the
questions
as
follows:
1.
No.
2.
No.
3.
No.
I
HEREBY
CERTIFY
to
His
Excellency
the
Governor
General
in
Council
that
the
foregoing
are
my
reasons
for
the
answers
to
the
questions
referred
herein
for
hearing
and
consideration.
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