Supreme Court of Canada
Bickford v. Chatham (Township), (1889) 16 S.C.R. 235
Date: 1889-01-15
Edward Oscar Bickford & The Erie & Huron Railway Company (Plaintiffs) Appellants;
and
The Corporation of the Town of Chatham (Defendants) Respondents.
1889: October 16; 1889: January 15.
Present: Sir W.J. Ritchie C.J. and Strong, Fournier, Henry, Taschereau and Gwynne JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR ONTARIO.
Railway Co.—Aid to—By-law granting bonus—Conditions of prior agreement—Performance of conditions—Specific performance—Damages.
By an agreement between the E. & H. Railway Co. and the Town of C. the latter agreed to pass a by-law granting a bonus to the company in aid of the construction of a railway subject to the performance of certain specified conditions. The by-law subsequently approved by the ratepayers, and passed by the council of the town, did not contain all the conditions of the agreement. In an action against the town to compel the delivery of debentures for the amount of the bonus the defendants pleaded non-performance of the conditions of the agreement as justifying the withholding of the debentures and, byway of counter-claim, prayed specific performance of such conditions by the plaintiffs.
Held—1. Per Ritchie C.J,. Strong, Fournier and Henry JJ., Taschereau and Gwynne JJ. contra, that the title to the debentures did not depend upon prior performance of conditions in the agreement not included in the by-law, but upon performance of those in the by-law alone, and the latter having been complied with the debentures should issue.
2. Per Fournier J., that the debentures should, nevertheless, be withheld until the damages for non-performance of the conditions in the agreement were paid or secured.
3. Per Ritchie C.J., Strong and Henry JJ., Fournier J. contra, that specific performance was not an appropriate remedy in such a case and the defendants could only claim damages for non-performance.
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4. Per Ritchie C.J., Strong and Fournier JJ., that the claim of defendants for damages could be disposed of in this action under the counterclaim and there should be a reference to assess the same.
5. Per Henry J., that the evidence did not justify a reference and the counterclaim should be dismissed with a reservation of defendant’s rights.
One of the conditions in the agreement to be performed by the railway company was “to construct at or near the corner of Colborne and William Streets (in Toronto) a freight and passenger station with all necessary accommodation, connected by switches, sidings or otherwise with said road” upon the council of the town passing a by-law granting a necessary right of way.
Held—1. That such condition was not complied with by the erection of a station building not used, nor intended to be used, and for which proper officers such as station master, ticket agent, etc., were not appointed. Strong J. dissenting.
2. Per Strong J., that the condition only called for the construction of a building with the required accommodation and connections, and did not amount to a covenant to run the trains to such station or make any other use of it.
3. The words “all necessary accommodation” in the condition required that grounds and yards sufficient for freight and passenger traffic in case the station were used should be provided.
The act incorporating the railway company contained provisions respecting bonuses granted to it by municipalities not found in the Municipal Act.
Held, that such special act was not restrictive of the municipal act, and it was only necessary that the provisions of the latter should be followed to pass a valid by-law granting such a bonus.
Held also, that all defects of form in the by-law were cured by 44 Vic. ch. 24, sec. 28, providing for registry of by-laws and requiring an application to quash to be made within three months after such registry.
APPEAL from a decision of the Court of Appeal for Ontario affirming the judgment of the Common Pleas Division in favor of the plaintiff.
The action in this case was brought to compel the delivery by the defendants of debentures to the amount of $30,000 to which the plaintiffs claimed to be entitled under a by-law of the defendant corporation therefor,
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passed in December, 1883. The conditions of the by-law as to what was necessary to be done by plaintiffs to entitle them to the debentures were as follows:—
“The construction and completion for running of the track and road of the Erie & Huron Railway Company from the town of Chatham to the Canada Southern Railway, on or before the 30th day of June, A.D. 1883, or such later date as the council of said town may by resolution from time to time fix; and the construction and completion, within two years from the date on which this by-law takes effect, of the whole track and road of said Erie & Huron Railway Company from the town of Dresden and the village of Wallaceburg to the Rondeau Harbor, laid with steel rails and with stations and freight houses and other necessary accommodation attached and connected therewith, and with a station and freight house and switches or sidings at the crossing of the track of the Canada Southern Railway Company, so that trains can run off the track of the Erie & Huron Railway Company upon, or parallel with and adjacent to, the track of the Canada Southern Railway Company, with a platform 600 feet long adjacent to and parallel with the said last-mentioned track, and 400 feet long and adjacent to and parallel with the track of the Erie & Huron Railway Company; the construction of a bridge over the Thames with an iron or wooden swing, and an adjoining bridge and way for foot passengers over said river not less than four feet in width; the complete construction of said road in other respects supplied with all necessary rolling stock and materials, so as to connect the said town with Rondeau, Blenheim, the Canada Southern Railway, Dresden and Wallaceburg, to the satisfaction of the Commissioner of Public Works for the time being for Ontario, or an engineer appointed by him; and said company thereafter bonâ fide running said road with
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all necessary accommodation for the public, and with connection at the track of the Canada Southern Railway Company for one week.”
This by-law was duly registered as provided by 44 Vic., ch. 24, sec 28.
Prior to the passing of the by-law an agreement was entered into between the defendants and the Erie & Huron Railway Company, by which the defendants agreed to pass such by-law on conditions similar to the above, and with the following additional clauses:
“And to construct at or near the corner of Colborne and William streets, in the said town, a freight and passenger station with all necessary accommodation, connected by switches, sidings or otherwise with said road of the company, upon the council of said town, within three months from the final passing of said by-law, passing another by-law empowering the said company to make its roads and lay its rails along a highway or highways in the said town to said corner, from where the said road would be if the construction thereof were completed in a direct line through the said town, or upon the said council procuring for and giving to said company a right of way along the northerly side of McGregor’s Creek (one half in the water) for the road of said company to or near said corner and to load from gravel piles, pits or beds purchased by said corporation adjacent to or adjoining the track of said company, and carry gravel over said road to any place required by the said town for the construction, maintenance, and repair of public roads in said town, and for other purposes of the town for a sum and at a rate for loading and carriage not to exceed 3 cents per cubic yard of gravel per mile, for all distances less than ten miles, and 2 cents per mile for all distances of ten miles and over, but under 25 miles,
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and one and-a-half cents per mile for all distances of and over 25 miles.”
The road was completed and in running order, and carrying freight and passengers, long before the time mentioned in the by-law, and was run continuously thereafter to and from the King street station for a week, and has been running ever since.
On 1st November, 1883, Robert McCallum, a civil engineer, appointed by the Commissioner of Public Works for the province of Ontario, gave a certificate in the following words:—“This is to certify that I have examined the Erie & Huron Railway from Rondeau Harbor to the town of Dresden, and from Dresden to Wallaceburg, and find that the said road is completed and at present supplied with all necessary rolling stock and materials so as to connect Rondeau Harbor with the Canada Southern Railway, Blenheim, Chatham, Dresden and Wallaceburg, and, in my opinion, is ready for the conveyance of freight and passengers.”
The same engineer granted a more formal certificate, setting forth that on the 23rd day of December, 1884, he had made an examination and inspection of the Erie & Huron Railway from Rondeau Harbor to the town of Dresden and from Dresden to Wallaceburg, and had in connection with such examination perused the agreement entered into between the Erie & Huron Railway Company and the corporation of the town of Chatham, dated November, 1882; also, the by-law of the town of Chatham, passed in the month of December, 1882, granting a bonus of $30,000 to the railway company upon certain terms and conditions; that he found the said railway was completed and supplied with all necessary rolling stock and materials so as to connect, as arranged, with the Canada Southern Railway Company, Blenheim, Chatham, Dresden and Wallaceburg, and
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was, in his opinion, ready for the conveyance of freight and passengers., and that the railway company had substantially complied with the terms and conditions regarding the work to be performed required by the said agreement and by-law, except as to time, as to which he would give no certificate as he was not aware of the time limited. He also found and certified that the platforms provided for by the said agreement and by-law at the crossings of the Canada Southern Railway were theretofore completed in accordance with the requirements of the said agreement and by-law, but that afterwards a portion thereof was temporarily removed by the Canada Southern Railway for the purpose of enabling the said company to lay a pipe to a water tank, and such portion at the time of inspection had not been restored
No notice was given to the defendants of the appointment of McCallum as the engineer to make the inspection, nor of the time he would make his inspection; and such inspection was made without the presence of any one acting for or on behalf of the town.
After the passing of the bonus by-law the defendants passed another by-law on the 24th of March, 1883, authorizing the railway company to make its road and lay its rails for one single track, or train, along the southerly side of Colborne street, from the main line to William street in said town, and for two tracks, or a double track, between Adelaide and William streets, provided that the said road and tracks should be at least eight feet from the middle line of said street.
The agreement between the Erie & Huron Railway Company and the defendants, and the agreement between the plaintiff, Bickford, and the plaintiffs, the Erie and Huron Railway Company, were made valid and binding by 46 Vic., cap. 52.
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The defence set up by the defendants was, in substance, that the station was not placed at the corner of Colborne and William streets as provided in the agreement; that McCallum was not appointed, and did not make his examination, as the by-law provided; that the road was not completed within the time limited; that the said railway was not constructed and completed on or before the 30th day of September, 1883, with station and freight houses and other necessary accommodation, which they submitted included a freight and passenger station with all necessary accommodation for the defendants, with switches, siding, or otherwise connected with the said road at or near the corner of Colborne and William streets, according to the terms of the alleged by-law and agreements, or either of them; that a platform 600 feet long, adjacent to and parallel with the Canada Southern Railway, and 400 feet long adjacent to and parallel with the Erie and Huron Railway, at the junction of the said two railways was not constructed; that a bridge over the river Thames, with iron or wooden swing, and an adjoining bridge for foot passengers not less than four feet in width, approaches, and other necessaries connected with said bridge, so as to form a way over said river for the public, were not constructed; that a freight and passenger station, with all necessary accommodation, connected by switches, sidings, or otherwise, with said road, was not constructed at or near the corner of Colborne and William streets.
The defendants, by counter claim, set forth the several grounds of defence as causes of action against the plaintiff and prayed that the plaintiff be ordered to construct and maintain a foot-bridge across the Thames with approaches over the flats of the river and lands of the plaintiff on both sides of the river, and perform the other requirements of those agreements and remove
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one of the tracks laid on Colborne street ‘and to erect and establish all necessary workshops and repairing houses or sheds within the town and to remove the station on Colborne street off the line of the street, and to cease to use said street as a switch, or siding cars or trains thereon, and that it be referred to the master to ascertain the damages which the defendants have sustained, and that plaintiffs be ordered to pay the same.
The evidence disclosed that the road was completed and in running order and open for general traffic to the King street station within the time mentioned in the by-law, but there was conflicting evidence as to whether passenger trains had been run to the Colborne street station continuously for one week; that when the iron bridge across the Thames was first completed the footbridge across was not quite the required width, but that afterwards the footbridge was made of the requisite width, except that at one point one of the iron wire guy ropes passed through the footway so as to have the footway obstructed by this rope, but such obstruction did not impair or prevent the convenient use of the footway; that the platform at the southern railway junction was of the specified dimensions but not continuous and was amply sufficient for the requirements of the traffic on the road; that there was a double track on Colborne street and that owing to the state of the street by reason of the encroachment of McGregor’s Creek the rail was not kept eight feet from the centre of the street as required by the by-law allowing the laying of the track on Colborne street, and the station on Colborne street was not placed at the corner of Colborne and William streets but a block away from William street at or near the corner of Colborne and Adelaide streets.
There was conflicting evidence as to whether the
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station could be put nearer to William street so as to be convenient and useful to the public and the company, so there was not a strict compliance with the terms of the plaintiff’s agreement unless the distance between the station and William street was not so great as to prevent it coming within reasonable intendment of the meaning of the word “near.”
The cause was tried before the Chief Justice of the Common Pleas who held that the plaintiffs’ title to the debentures did not depend upon the performance of the requirements of the agreement not provided for in the by-law, and for any breach of the same the defendants’ remedy would be under the counter-claim for damages. His Lordship held the plaintiff bound to perform the following conditions of the by-law before he could succeed in this action:
“First. The construction and completion for running of the track and road from Chatham to the Canada Southern Railway on or before the 30th day of June, 1883.
‘‘Secondly. The completion of the whole track and road with stations and freight houses and other necessary accommodations attached and station, freight house and platform of the stipulated dimensions at the Canada Southern crossing.
“Thirdly. The bridge and foot way over the Thames, with the necessary approaches.
Fourthly. The completion of the road in other respects, supplied with all necessary rolling stock and materials so as to connect the town with the places named to the satisfaction of the Commissioner of Public Works, or an engineer appointed by him, and,
Lastly, upon the company bonâ fide thereafter running the said road with all necessary accommodation for the public and with connection at the track of the Canada Southern for one week.”
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And he held that these conditions were all substantially performed, and that the plaintiff was entitled to the debentures and to a writ of mandamus to compel their delivery.
Another ground of defence set up was that the by-law was ultra vires for not complying with the provisions of the plaintiffs’ charter, which, it was contended, overrides the Municipal Act in respect to aid to railways. His Lordship overruled this contention and held that the special act is not restrictive but only enabling and enlarging the power of municipalities under the Municipal Act, and the latter being complied with the by-law was intra vires of the corporation.
The defendants appealed from the judgment of the Chief Justice and the Court of Appeal varied that judgment by decreeing the defendants entitled to specific performance of the agreement as to the station on the corner of Colborne and William streets, with a reference to the master to ascertain the damages to be paid defendants for want’ of such station to date of judgment. The mandamus was stayed until the master should report. In other respects the judgment of the Common Pleas was sustained. Both parties appealed to the Supreme Court of Canada.
S.H. Blake Q.C. and W. Cassels Q.C. for the appellants.
All the judges in the courts below have found that the conditions in the by-law were complied with and those of the agreement were independent of each other. The plaintiffs have therefore performed all the conditions required to entitle them to the debentures. See Wilson v. Northampton & Banbury Junction Ry. Co.; Jessep v. G.T. Ry. Co.; Mead v. Ballan;
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Lytton v. Great Northern Ry. Co.; Desjardin Canal Co. v. Great Western Ry. Co.; Powell Duffryn Steam Coal Co. v Taff Vale Ry. Co.; Blackett v. Bates.
Christopher Robinson Q.C. and Wilson for the respondents cited Wallace v. Great Western Ry. Co.; Hodges on Railways; Wilson v. Furness Ry. Co,; Rigby v. Great Western Ry. Co.; Hood’s Case; Firth v. Midland Ry. Co.; Green v. West Cheshire Ry. Co.; C.A. Ry. Co. v. County of Ottawa.
SIR W.J. RITCHIE C.J.—The statement of this case is to be found at length in the judgment of Chief Justice Cameron.
Neither party was satisfied with the decision of the learned Chief Justice and both parties appealed to the Court of Appeal for Ontario; that court decreed in substance as follows:—
From this decree both parties also appealed; the plaintiff, however, limited his appeal to that portion of the judgment given upon the counter claim of the defendants construing the covenant in the agreement in reference to the construction of the station at or near the corner of Colborne and William streets and ordering specific performance of such agreement.
The by-law under which the debentures are claimed in this case is as follows:—
The agreement dated the 3rd of Nov. 1882, between the Erie and Huron Railway Co. and the Town of Chatham recites that:—
And whereas the said Co. in order to complete its road and pro-
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vide it with rolling stock and all necessaries, requires a further bonus of $30,000 in debentures from the said town payable on obtaining the certificate of the Government’s Engineer of the completion of the said road, according to the terms of a by-law to be submitted to the electors of said town, and the running thereof for one week, and in order to induce the town to submit and pass the said by-law and give such aid, has offered to execute a binding agreement with the town containing the terms and obligations on the part of the Co. hereinafter set forth.
And whereas the town, upon the consideration of such binding agreement, has agreed to read, submit to the electors, and with their consent finally pass, such by-law to give further aid to said company as in the by-law set forth.
This very clearly shows that the by-law and agreement were to be considered as two separate and distinct instruments, and the certificate, on the obtaining of which the debentures were to be issued, was to be of the completion of the road according to the terms of the by-law to be submitted, and not according to the terms of the by-law and to the stipulations contained in the agreement but not inserted in the by-law and forming no part of it.
On the 1st of Nov., 1883, Mr. C.F. Fraser, Commissioner of Public Works for Ontario, appointed Robert McCallum, C.E., “as engineer under the by-law of the Town of Chatham taking effect on the 30th December, 1882, giving a bonus to the Erie and Huron Railway, for the purpose of certifying as by the said by-law is required.’’
I can discover nothing to impeach this engineer’s certificate. I do not think the engineer, McCallum, acted in any way as a judge or arbitrator between the town and the railway company or Bickford; all he had to do was personally to examine and inspect the road and to certify whether or not in the terms of the by-law (section 1) the road, &c., was constructed and supplied, &c., in accordance with the by-law to his satisfaction. I can see nothing in the nature of his
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office, or the performance of his duties, that required notice to either party, either of his appointment or of the time he would make his inspection. I do not think the by-law requires the engineer’s certificate to say anything outside the by-law which does not refer to nor incorporate with it any agreement; the certificate was to certify as to the completion according to the] by-law and not according to any agreement forming no portion of the by-law. The certificate of the engineer is substantially in accordance with the terms of the by-law and the evidence shows that all that the by-law requires had been performed.
If, then, all the conditions contained in the by-law have been complied with, and I think the learned Chief Justice was right in so holding, why should not the debentures issue? It was on these conditions being complied with that the municipality and ratepayers agreed that the debentures should issue; what right have we to go outside of the by-law and say they should not issue? If the town of Chatham or the taxpayers had wished to make the issue of the debentures on other conditions they should have had them inserted in the by-law.
There appears to have been a great diversity of opinion in the town as to the propriety of establishing the station at Colborne Street; might this not have been the reason why nothing was said about it in the by-law as, if mentioned, the passing of the by-law by the ratepayers might thereby have been jeopardized? Otherwise, why was this not inserted in the by-law if the town and the ratepayers intended that the construction of the station at or near the corner of Colborne and William streets was to be a condition precedent and on the fulfilment of which the debentures were to issue? So far, as a matter of fact, from this by-law being passed because of this particular
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stipulation I think the inference from the evidence is that this was rather kept in the background for fear, by reason of the conflict of opinion, the ratepayers might refuse to pass the by-law.
I think all the evidence as to what was said before the submission to the ratepayers, or during the canvass or discussion at any public meeting of ratepayers or others, in the absence of fraud which is not alleged or proved, was wholly irrelevant and, in my opinion, should not have been received as influencing, in any way, the construction that should be placed on either the agreement or by-law, or both.
The municipality not having chosen to insert in the by-law any provision or condition for the constructing and establishing of a station at Colborne street, and the ratepayers, on the 13th December, 1887, having, by their vote, consented to the issuing of the debentures without any such condition, I am of opinion that the provisions in the agreement, but not inserted in the by-law, must be treated and dealt with as separate and distinct from the by-law and as independent covenants, and, as I have said, the conditions of the by-law having been complied with the debentures should issue, and for any breach of the agreement outside of the by-law the municipality and ratepayers, not having made the issue of the debentures dependent on the fulfilment of the agreement, must seek indemnity for any breach of such agreement in damages and not seek to enforce the agreement by withholding the debentures.
I participate in the doubt expressed by Mr. Justice Osler as to the correctness of the finding, as a matter of fact, that at or near the corner of Colborne and William streets may mean at or near the corner of Colborne and Adelaide streets, in another block and with other streets intervening; the evidence satisfies
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me that there was no impossibility in erecting or working the station at or near the corner named, though no doubt, it may have been a very inconvenient spot for the working of the railway, but I am not disposed to differ from the learned Chief Justice and I entirely agree with him that this station was not essential to the completion of the road in accordance with the by‑law and therefore does not prevent the accruing of the plaintiff’s title to the debentures, because I agree with him that this does not depend upon the performance of stipulations in the agreement not provided for by the by-law; that for the breach of plaintiff’s agreement not covered by the conditions of the by-law the remedy of the defendants is under their counter‑claim for damages for such breach.
The conditions of the by-law, the fulfilment of which are conditions precedent to the right of the plaintiff to the debentures, are:—
The Chief Justice then says:—
There was no dispute as to the completion of the road for running to the Canada Southern by the time stipulated. The evidence satisfies me the second condition was fulfilled, that is to say, the construction of the whole road, with stations, freight houses and other necessary accommodation attached, and platform accommodation stipulated for at the Canada Southern Junction, or crossing. I am also satisfied that the bridge across the Thames was a substantial compliance with the requirements of the by-law in respect thereto. The approaches were sufficient.
In this conclusion, after a very careful perusal of all the evidence in the case, I concur.
I think the construction of the clause of the agreement in relation to the Colborne and William streets station which is as follows:—
involves all the necessary accommodation for the continuous and ordinary use by the public of the station when constructed. How can it be that there is all
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necessary accommodation at a station where there is no station master, ticket officer, baggage master or other servants connected therewith? How can it be said that, there is a freight and passenger station with all necessary accommodation connected by switches, sidings or otherwise with said road of the company to which no trains are to be run or if run then no accommodation for freight or passengers to enable the one or the other to be carried from or to the station? I cannot think that the mere erection of a building called a station, and the abandonment of its use as a station, is a performance of the agreement. It seems to me almost a mockery to say there is a station there with all necessary accommodation to which a train is never run and access to which is impossible by reason of the waiting room and ticket office being closed and no person to attend to passengers or to receive and forward freight. What accommodation is afforded by a room called a waiting room, ticket office and freight room, and a platform, if neither the one nor the other can be used by passengers or for freight? I think the connection by switches, sidings and otherwise with the main road of the company shows that the station to be erected was to be ordinarily worked and used as part and parcel of the road by the company, and I am the more impressed with the correctness of this by reading the by-law which grants to the company the right to make its road and lay its rails “along the southerly side of Colborne street from the main line to William street, &c.,” and which the company and Bickford adopted and acted on. It recites that,
Whereas the said company and Bickford have agreed to construct and establish a station and freight house and other necessary accommodation for said company and the public at the corner of Colborne and William streets upon the council of said corporation passing this by-law; and whereas the council of said corporation desires that such
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station and freight house and other accommodation should be erected and established.
Now, what can be the fair meaning of constructing and establishing a station and freight house with necessary accommodation, not for the company alone but for the said company and the public, if it is not to fix, permanently and unalterably, for the ten years the train was to run, a station and freight house with all necessary accommodation for the use, not only of the company but of the public? And who can say that the erection of a building, not to be used as a station and freight house but locked up, with no necessary accommodation for the public to enable the station to be used as such, is satisfied by a station building where no tickets can be obtained and from which no trains are to come and go? I think it is not. I think the true construction of the contract was to construct and establish a station with all such accommodation for the public as is ordinarily to be found at a station from which trains regularly run, and at which passengers are taken up and freight received and delivered. I think the observations of Chief Justice Hagarty with reference to the provision in the agreement to run the road continuously for at least ten years, and with reference to the clause as to Colborne street station, are conclusive that the whole sense of the words used points to a continuous use, and I agree with him that it would be a monstrous injustice to hold that a company may accept the full consideration as to stations, &c., and refuse to place them in a position to be used.
Assuming that the station was properly located I am of opinion that the station and station accommodations are not sufficient to answer the requirements of the plaintiff’s covenant, being deficient in proper accommodation for loading and unloading freight and the absence of all accommodation for the public.
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The majority of the Court of Appeal have considered that the defendants are entitled to specific performance of the agreement in the pleadings mentioned as to the station on Colborne street in the town of Chatham, as claimed by the defendants in their counter-claim. Now, what have they claimed?
(c) That they may be ordered to construct and maintain a freight and passenger station with switches, sidings and all other necessary accommodation for the defendants upon lands of or to be purchased by the plaintiffs at or near the corner of Colborne and William streets, and to provide and keep a station master, ticket and baggage officer, and other necessary and ordinary servants of the said company thereat, and to stop all ordinary trains thereat, and not to run such trains past said town without going to and staying at said station for the purpose of taking up and setting down passengers or freight, or both, and that they use and establish such station as the principal and main station for Chatham.
This, I think, cannot be so adjudged. This is not the performance of a definite work to be performed once for all. It is clear that the court may exercise a discretion in granting or withholding a decree for specific perfermance, and I think it is equally clear that such a decree will not be made when the terms of the agreement are vague and its effect is to throw on the court the duty of superintending the performance of a series of continuous acts involving the exercise of skill, personal labor and judgment.
I think the case of Wilson v. Northampton & Banbury Junction Railway Co. very distinguishable from the present. There the station mentioned in the schedule, so far as it related to the station to be erected, was in the following words—“a station to be made on lots Nos. 24, 25 and 26, parish of Wappingham, or some part or parts thereof.”
Very different, indeed, from the station which the plaintiff undertook to construct in this case.
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If then, the construction of a freight and passenger station involves the necessity of maintaining it and providing the necessary officers and means of keeping it in a state of accomplishing the purposes \of a freight and passenger station, as the Court of Appeal think and as I think it does, then it necessarily involves the keeping of the station open at suitable times for passengers and freight and the carrying on of the business of a freight and passenger station, requiring the performance of personal acts and duties involving the continuous exercise of skill and judgment as well as good faith and diligence in determining the nature and extent of the facilities required at a suitable station. If so would not this constitute the performance to be decreed and if decreed impose on the court the duty of seeing that the performance was within the intent of the contract, and the non-performance of which could only be punished by repeated attachments?.
The result of decreeing specific performance in such a case as this would compel the court to superintend the execution of this particular stipulation for, at any rate, the ten years that the agreement provides that trains shall run, which, in my opinion, is contrary to the authorities which, I think, conclusively show that the court will not superintend the performance of such continuous acts.
Nothing can very well be more vague and uncertain than this agreement. Upon what land is this station to be constructed? The defendants claim it is to be on lands of, or to be purchased by, the plaintiff at or near the corner of Colborne and William streets. How is the court to determine the exact site and upon what lands of the plaintiffs or, if they have no suitable lands, what lands are they to be required to purchase?
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Then, as there is no certainty as to where the station is to be placed there is no certainty as to the character of the station, no plans, no specifications, no provision as to dimensions, material or workmanship by which the officer of the court, with the agreement, claim and decree in his hands, could determine whether the agreement had been specifically performed or not.
The English and American authorities seem very clear that courts of equity will not enforce the performance of continuous duties, involving personal labor and care of a particular kind which the court cannot superintend. Of the numerous cases to be found in the books I shall notice a very few which seem to me to bear directly on this case.
Marble Company v. Ripley:
Mr. Justice Strong:
Another serious objection to a decree for a specific performance is found in the peculiar character of the contract itself and in the duties which it requires of the owners of the quarries. These duties are continuous. They involve skill, personal labor, and cultivated judgment. It is, in effect, a personal contract to deliver marble of certain kinds, and in blocks of such a kind that the court is incapable of determining whether they accord with the contract or not. The agreement being for a perpetual supply of marble, no decree the court can make will end the controversy. If performance be decreed the case must remain in court forever, and the court to the end of time may be called upon to determine, not only whether the prescribed quantity of marble has been delivered, but whether every block was from the right place, whether it was sound, whether it was of suitable size, or shape, or proportion. Many of the difficulties in the way of decreeing specific performance of a contract, requiring, as this does, continuous personal action, and running through an indefinite period of time, are well stated in The Port Clinton Railroad Co. v. The Cleveland and Toledo Railroad Co.; Fry on Specific Performance
Port Clinton Ry Co. v. Cleveland & Tol Ry. Co.:
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Molson J.:
It is different from the case where the act to be done would produce some tangible result, which could be inspected and compared with the requisitions of the contract. When no such result follows the personal act, but the act involves the continuous exercise of skill, judgment or discretion, the manner and mode of which are, from its very nature, undetermined, the difficulty of a specific performance seems almost insuperable.
Even in cases where there would be a visible and tangible product from the personal act, if the contract does not define and determine the character of that product, the court will not supply that which has been left by the parties as a matter of individual judgment, taste or discretion. Thus, in a class of cases in which there has been a diversity of opinion as to the propriety of a specific performance, the building a house on particular land, the covenant to build must have a definite certainty as to size, materials &c. Story Eq. Jur.
Blanchard v. Detroit and Lake Mich. Ry. Co.:
Graves C.J.:
If, however, it appears, either that the things to be performed are in their nature incapable of execution by the court, or that needful specifications are omitted, or that material matters are left by the parties so obscure or undefined, or so in want of details, or that the subjects of the agreement are so conflicting or incongruous, that the court cannot say whether or not the minds of the parties met upon all the essential particulars, or if they did, then cannot say exactly upon what substantial terms they agreed, or trace out any practical line where their minds met, the case is not one for specific performance.
As the court does not make contracts for parties so it never undertakes to supply material ingredients which they omit to mention, and which cannot be legitimately considered as having been within their mutual contemplation. And where the party to perform is left by the agreement with an absolute discretion respecting material and substantial details, and these are therefore indeterminate and unincorporated until by his election they are developed, identified, and fixed as constituents of the transaction, the court cannot substitute its own discretion, and so by its own act perfect and round out the contract. If the court were to do this it would be to assume a right not belonging to it, but one which the parties reserved to themselves.
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P. 54. It is, first, that defendants shall make and maintain on the premises a depot or station house, suitable for the convenience of the public.
Second, that during all future time, when trains run on the road, at least one train each way shall every day stop thereat, and third, that for all future time freight and passengers shall be regularly received and discharged at such depot.
P. 58. Without going further in this view of the case, it is only needful to say that it seems obvious that the very nature of the provision sought to be enforced is such as to render the remedy impracticable. But if this objection were not insuperable there would be still another in the want of details and lack of particularity and specification. The specific location is not given for the building, nor is there anything certain as to the plan, size, shape, materials or arrangement of the building. All this appears to have been left by the assent of the parties, substantially to the judgment, and discretion of the grantees. The only specification, the only limit upon such judgment and discretion, the parties saw fit to make, was that it should be suitable for the convenience of the public. For many purposes this might be considered definite enough. It would be in a charter in which the end to be obtained would be presented as the object of the legislature, whilst everything in regard to details and means would be rightly and purposely left to the company. But for a building contract or an agreement to be executed by the court, it is not so. If the court were to attempt to decree, what direction could it give as per contract in regard to the plan, size, shape, materials, arrangement and cost? If what would now satisfy the interest of the public were known it might guide as to the present size and arrangement; but it could go no further. What is needful now may be otherwise in time, and future changes in the state of the country or in business may wholly disappoint all present calculations. The public interest may require many alterations. But the reference to the public convenience gives no clue whatever as to the materials, or in regard to other essential matters.
Powell Duffryn Steam Coal Co. v. Taff Vale Railway Co.
Mr. Greene Q.O. and Mr. Marten Q.C. for the appellants:
We have a statutory right to use the railway under the Railway Clauses Consolidation Act, 1845, s.92, and we seek to have that right
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protected. In Bell v. Midland Railway Company the court interfered to protect statutory rights under the act, and in Green v. West Cheshire Railway Company it interfered, by way of specific performance, to make a railway company construct and maintain a siding.
The Lord Justice James:
I doubt whether this court can give effect to the rights Conferred by sect. 92. As far as my experience goes, the court has never ordered anything which involves doing something from day to day for an indefinite period.
The Lord Justice Mellish:
I feel the same doubt, and am disposed to think that a court of common law would feel the same difficulty as to a mandamus, A court can only order the doing something which has to be done once for all, so that the court can see to its being done. The Railway Clauses Act was passed at a time when the working of railways was not well understood. The legislature seems to have considered that there was no more difficulty about running over a railway than along a turnpike road. It is found now that the use of points and signals is required: but how can the court see to the defendants working them day after day for a series of years?
Gervais v. Edwards.
The Lord Chancellor:
If the jurisdiction of this court permitted it, I should willingly grant a specific performance of this agreement, because the merits are altogether on the side of the plaintiff; but I do not see how it is possible specifically to execute this contract. The court acts only, when it can perform the very thing, in the terms specifically agreed upon, but when we come to the execution of a contract, depending upon many particulars, and upon uncertain events, the court must see whether it can be specifically executed; nothing can be left to depend upon chance; the court must itself execute the whole contract.
Waterman on the Specific Performance of Contracts. Contracts incapable of being enforced.
Equity will not inforce the performance of continuous duties involving personal labor and care of a particular kind which the court cannot
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superintend as the working of points and signals on the line of as railroad requiring constant supervision; Powell Duffryn Steam Coal Co. v. Taff Vale Ry. Co., or a contract to build and equip a railroad, Danforth v. Philadelphia, etc., Ry. Co., or to work all the trains on a railroad, and keep the engines and rolling stock in repair; Johnson v. Shrewsbury and B.R.R., or to use the railroad of another company with engines and trains, which the court cannot regulate and control; Powell Duffryn Steam Coal Co. v. Taff Vale Ry. Co. or an agreement by a railroad company to maintain and keep in repair cattle-guards upon the land of the plaintiff; Columbus, &c., Ry. Co. v. Watson, or a covenant in the lease of a coal mine to work the mine efficiently; Wheatley v. Westminster Coal Co., Lord Abinger v. Askton, or an agreement by a street railroad company to run cars along a particular street daily, “at such regular intervals as may be right and proper,” whether the obligation of the company rests in contract, or is derived from the provisions of its charter. McCanny v. South, &c., Ry. Co.
P. 70 S. granted to a railroad company a right of way through his premises on condition that the company would place beside its road on said premises a platform convenient for loading and unloading cars, take therefrom all produce shipped by S., and bring and place thereon all freight shipped by or for him to that point from any other station on the road provided the company had three days’ notice. Held that S. could not compel specific performance. Atlanta, &c., Ry. Co. v. Speer.
P. 70 n. In this case the court said:
We are not asked to compel the plaintiffs in error to transport a particular kind of freight now being on the platform awaiting transportation—we are asked that they shall, in all future time, transport all freight and deliver it as required by defendant in error in the terms of the contract. It is evident that any such decree must be as general and as indefinite in its terms as the contract itself. It cannot specify as to the kind of produce, the quality, the time of performance; nor can the court make a decree, which will be satisfied by any specific act of peformance. After decree made the case must be kept open, and if the defendant in that decree be contumacious, there must be action of the court to enforce it 20, perhaps 50 times a year for all
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time. Besides in regard to each alleged violation of the contract, the other party is entitled to a hearing, He may insist that the freight in question at one time is not of the description contemplated in the contract; at another that it is not the property of the party complaining; at still another, that notice had not been given in the terms of the contract. We are satisfied that this is not a contract of which performance can be compelled by one sweeping decree embracing all time and all instances demanding performance. The party has an adequate remedy at law, and doubtless would be redressed there. The following clause in a deed to a railroad company is incapable of being specifically enforced; this conveyance is made upon the express condition that said railroad company shall build, erect and maintain a depot or station house on the land herein described, suitable for the convenience of the public, and that at least one train each way shall stop at such depot or station each day when trains run on said road, and that freight and passengers shall be regularly taken at such depot. Blanchard v. Detroit etc., R.R. Co. Graves C.J.: Can the court see that in all coming time these requirements are carried out? Can it know or keep informed whether trains are running, and what accommodations are suitable to the public interest? Can it see whether the proper stoppages are made each day? Can it take notice or legitimately and truly ascertain from day to day what amounts to regularity in the receipt and discharge of passengers and freight? Can it have the means of deciding at all times whether the due regularity is observed? Can it superintend and supervise the business, and cause the requirements in question to be carried out? If it can, and if it may do this in regard to one station on the road, it may, with equal propriety, upon a like showing, do the same in regard to all stations on the road, and not only so, but in regard to all stations on all the present and future roads in the state. That any such jurisdiction is impracticable appears plain, and the fault lies in the circumstance that the objects of the parties as they were written down by them, are, by their very nature, insusceptible of execution by the court. In a suit for specific performance by a landowner against a railroad company it appeared that the company, in consideration for the right of way for their track over the plaintiffs’ land, agreed to fence the same, to deliver to the plaintiff certain bonds, and to release him from a subscription to the stock of the company. It was held that the facts alleged entitled the plaintiff to a judgment for damages, but not to specific performance. Cincinnati and
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Chicago Railroad Company v. Washburn. A court of Equity as a temporary measure during the pendency of a litigation, may undertake by means of a receiver to operate a railroad. Coe v. Columbus, &c., R.R. Co. But it will only do this when the demand for the exercise of such a jurisdiction is imperative, and the court can make an order of limited duration, and give precise directions as to the manner in which the order shall be carried out Port Clinton R.R. Co. v. Cleveland & Toledo R.R. Co.; see Richmond v. Dubuque & Sioux City R.R. Co. A demurrer was sustained to a bill filed for the specific performance of an award which required that the defendant should execute to the plaintiff a lease of the right to such part of a railway made by the plaintiff as was on the defendant’s land, and that the defendant should be entitled to run carriages on the whole line on certain terms, and might require the plaintiff to supply engine power, while the latter should have an engine on the road; and that the plaintiff, during the whole time, should keep the entire railroad in good repair. The court remarked that it “had no means of enforcing the performance of daily duties during the term of the lease; that it could do nothing more than punish the party by imprisonment or fine in case of failure to perform them and might be called on for a number of years to issue repeated attachments for default.” Blackett v. Bates,. Specific performance was refused of a contract concerning the use and enjoyment of a quarry providing for “the delivery of certain kinds of marble in good sound blocks of a suitable size, shape, and proportion, and to quarry to order, as might be wanted to keep the mill fully supplied at all times, the amount to be not less than 75,000 feet per annum, and for so long a time as the said Ripley, his heirs, executors, administrators and assigns, might want.” The court said: “The agreement being for a perpetual supply of marble, no decree the court can make will end the controversy. If performance be decreed, the case must remain in court forever, and the court, to the end of time, may be called on to determine, not only whether the prescribed quantity of marble has been delivered, but whether every block was from the right place, whether it was sound, whether it was of suitable size, or shape, or proportion. Meanwhile, the parties may be constantly changing. It is manifest that the court cannot superintend the execution of such a decree. It is quite impracticable. And it is certain that equity will not interfere to enforce part of a contract, unless that part is
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clearly severable from the remainder.” Marble Co, v. Ripley. In a suit to compel the defendant to convey to the plaintiff certain land, it appeared that the defendant and another person owned the land, and that, being desirous of having it partitioned, the defendant employed the plaintiff to do the business, agreeing that for plaintiffs’ services, he would convey to him 320 acres of defendant’s share of the land. A bond was given to secure the performance of this agreement, giving to the plaintiff the right of selection, and making it incumbent on the defendant to convey as soon as the selection was made. A partition having been partly effected, further proceedings therein were postponed until the boundaries of the land could be fixed by proper authorities. This was not done until three years afterwards, when the plaintiff proposed to complete the partition; whereupon he made a selection, and demanded a conveyance. It was held that, as the plaintiff could not be compelled to complete the service he had agreed to perform, nor the defendant to accept them, the contract was not one which could be specifically enforced. Cooper v. Pena. Although usually a contract, relating to personal services, will not be specifically enforced, but the party aggrieved will be left to his remedy at law, yet there is an exception to the rule, when by the contract, something is to be done, on a party’s own land, of such a nature that the opposite party will be deprived of the benefit of labor and materials bestowed thereon, unless the contract is carried out, and the owner of the land is attempting thus to deprive him. Within this principle, a contract between a waver power company and a city, that the former should construct extensive certain water works, of a capacity to supply the city daily with a specified quantity of water, the works having been constructed, was enforced against the city. Columbia Water Power Co v. Columbia.
P. 72. But if the work agreed to be done is definite, and there is no remedy at law, specific performance will be decreed; as the construction by a railroad company of an archway under their road pursuant to their contract. Storer v. Great Western Ry. Co. So specific performance was decreed of a contract between the owner of land and a railroad company that, in consideration of the previous withdrawal by the land owner of a petition to parliament against the company’s bill, the company would construct and forever maintain at their expense a siding of a specified length along the line upon the premises of the land owner and set apart by him for that purpose. Green v. West Cheshire Ry. Co.
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As to the order that the mandamus should not be enforced until after the report of the master, and the damages, if any, paid or security given, but for the limit by the plaintiffs of their appeal, as at present advised. I am at a loss to discover upon what principle we can withhold the delivery of the debentures and make such delivery dependent upon the payment or security of the damages assessed. If the agreement formed a portion of the by-law, or was to be read as a part of it, and so the erection of the station with all necessary accommodation in the way of buildings, appliances, officers and attendants maintained and used in the regular and continuous running of the road, was a condition precedent, as it was not complied with the plaintiffs claim to the debenture should be dismissed. If it is not to be treated as a condition precedent to the giving of the debentures, I am unable to see what right we have, or upon what principle we can allow the defendants to retain the debentures as decreed. If the defendants were not satisfied with the security of the agreement they, it appears to me, should have stipulated for some better security; not having done so I do not see how the dedentures can be withheld without making an entirely new and different agreement from that entered into by the parties and to which the plaintiffs have never assented and for which the defendants, so far as I can see, in the proceedings have never asked.
But, as the plaintiffs have limited their appeal to the construction of the agreement and the order for specific performance I must assume that the retaining of the debentures until the payment, or security was given for the payment, of the damages was considered by the plaintiffs, under the circumstances, a fair and reasonable provision.
I agree with Chief Justice Cameron that section 559
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sub-section 4 of the Municipal Act, R.S.O., cap. 174, the act in force when the by-law was passed, justifies the passing of the by-law; and I also agree that 44 Vic. cap. 24, sec. 28, validates the by-law now in question as passed.
I think there is nothing in the objection that the validating act does not apply when no debentures have been actually issued. By reason of the terms in the validating act “every such by-law so registered and the debentures issued thereunder shall be absolutely valid and binding.”
If the by-law is valid by reason of this section 28 of 44 Vic. cap. 24, as I think it was, then the by-law is good and must be acted on, and if the conditions of the by-law have been complied with the debentures must be issued in accordance therewith, the issue of the debentures depending on the validity of the by-law under which they are to be issued.
The Court of Appeal has not passed on the question of the workshops but has, as the learned Chief Justice in the court below did, reserved the right to the defendants to take such action as they may be advised as to them at some future time.
I agree with the Court of Appeal that as to the wrongful continuance of the track upon the street a claim for damages does not seem to be an appropriate remedy.
I do not think the defendants’ counter-claim should be dismissed but that they should have damages assessed in this suit for the damages they can show have been sustained by reason of the breach of the contract as to the station. I think there should be a reference on the counter-claim to ascertain the amount of the defendants’ damages.
I think the decree in this case should be amended by striking out of the 3rd paragraph the words “that the
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defendants are entitled to a specific performance of the agreement in the pleadings mentioned as to a station on Colborne street, in the said town of Chatham, as claimed by the defendants in their counter-claim” and “up to the date of this judgment,” and by striking out the last clause.
STRONG J.—All the learned judges who have pronounced upon this case in the courts below, as well the four judges in the Court of Appeal as the late Chief Justice of the Common Pleas, before whom the action was tried, have determined that the objections to the validity of the by-law were not sustainable. With them and for the reasons given in the judgments of the Chief Justice of the Common Pleas and of Mr. Justice Burton, which I fully adopt and therefore need not repeat, I am of opinion that the special act of incorporation of the company does not take the case out of the operation of the general municipal law, but that the powers conferred on municipalities by the latter act are applicable. This being so the 28th section of the Ontario Act, 44 Vic., ch. 24, is relied upon as covering any objections which might be made to the by-law upon the ground of non-compliance with the requirements of the municipal act as regards recitals or otherwise. The statute in question, 44 Vic. ch. 24, is an act for the amendment of the general municipal law, and sec. 28 is as follows:—
Every by-law passed by any municipality for contracting any debt, by the issue of debentures for a longer term than one year, and for levying rates for the payment of such debts, on the ratable property of the municipality, or any part thereof, shall be registered by the clerk of such municipality, it a county, in the registry office for the county in which the county town is situate, or in case of callo municipalities in the registry office of the registration division in which the local municipality is situate, within the two weeks after the final passing thereof by such municipality; and every such by‑law so registered and the debentures issued thereunder shall be ab-
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solutely valid and binding upon such municipality according to the terms thereof, and shall not be quashed or set aside on any ground whatever, unless an application or suit to quash or set aside the same be made to some court of competent jurisdiction within three months from the registry thereof.
The Chief Justice of Ontario says in his judgment:
It is conceded that this by-law was registered as directed and no application was made within the three months.
And in the argument at this bar the due registration of the by-law and the omission of any application to set it aside within the prescribed time were conceded as admitted facts by the learned counsel for the respondents. It must therefore now be held that the by-law is valid and binding on the municipality.
The next question to be considered is as to the performance by the railway company of the terms of the by-law which were conditions precedent to the issue of the debentures. In this respect, also, I agree in opinion with the learned judges of the courts below, all of whom considered that the provisions of the contract between the town and the railway company dated the 3rd November, 1882, set out in full in the statement of defence, are not to be imported into or construed as part of the by-law. In the words of the Chief Justice of Ontario I read the covenants in this agreement as independent and not as dependent covenants. Although the agreement was intra vires both of the town and the railway company and therefore binding on the latter we are not to consider the stipulations contained in it as avoiding altering or qualifying the express conditions of the by-law, an instrument of later date. An insuperable objection, in my opinion, to a contrary construction is that the assenting and agreeing parties to the two instruments are different. The by-law is assented to by the body of ratepayers, the agreement, so far as the town is concerned, emanates from
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the council alone. If the by-law had been passed first, no one could contend that any alterations in its terms could have been effected by a contract entered into with the town through the mayor and council. Then the fact that the agreement preceded the by-law so far from being a reason for any difference in this respect makes the objection to such a variation still stronger. Authority to issue debentures could only have been conferred by a by-law assented to by the ratepayers who were never called upon to vote upon a by-law incorporating the terms of the agreement. The railway company to entitle itself to the debentures is therefore bound to show performance of the terms and conditions imposed by the ratepayers, but of no others. The by-law and the agreement being then between different parties, the contract is therefore necessarily entirely collateral to and independent of the by‑law. As regards the contract of the 4th Dec, 1882, between the railway company and the other plaintiff. Bickford, for making the railway,—I know of no principle upon which that can be said to have any influence upon the construction of the by-law. It was between different parties entirely and the railway company never undertook to come under the same obligations to the town as Bickford by this contract had assumed towards them. To read the provisions of this last contract as if incorporated in the by-law would be, in my opinion, to make a contract for the parties which they never entered into, besides being open to all the objections already taken with reference to the agreement of the railway company with the town that it would be an innovation upon the terms of the by-law which the ratepayers never assented to and were never as much as called upon to consider. I quite agree, therefore, that the courts below were right in the view which they took of the principal action,—
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the proceeding instituted by the railway company, and Mr. Bickford claiming under it by assignment, to enforce the delivery of the debentures—viz., that the right of the plaintiffs in this respect depended exclusively on their ability to show that they had performed the conditions precedent set forth in the body of the by-law itself and that they were not bound to go further and show a performance also of the stipulations of the agreement.
Then to consider the plaintiff’s right to recover, in this aspect, we find that so much of the by‑law as specifies the work to be performed by the railway company as preliminary to the issuing of the debentures is contained in the first clause which is as follows:—
That upon construction and completion for running of the track and road of the Erie and Huron Railway Company from the town of Chatham to the Canada Southern Railway, on or before the 30th day of June, A.D. 1883, or such later date as the Council of said town may by resolution from time to time fix; and upon construction and completion, within two years from the date on which this by-law takes effect, of the whole track and road of said Erie and Huron Railway Company from the town of Dresden and village of Wallaceburg, to the Rondeau Harbor, laid with steel rails and with stations and freight houses and other necessary accommodation attached and connected therewith, and with a station and freight house and switches or sidings at the crossing of the track of the Canada Southern Railway Company, so that trains can run off the track of the Erie and Huron Railway Company upon, or parallel with and adjacent to, the track of the Canada Southern Railway Company, with a platform 600 feet long adjacent to and parallel with the said last mentioned track, and 400 feet long and adjacent to, and parallel with the track of the Erie and Huron Railway Company; and upon the construction of a bridge over the Thames with an iron or wooden swing, and an adjoining bridge and way for foot passengers over said river not less than four feet in width; and upon the complete construction of said road in other respects, supplied with all necessary rolling stock and materials, so as to connect with the said town, with Rondeau, Blenheim, the Canada Southern Railway, Dresden, and Wallaceburg, to the satis-
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faction of the Commissioner of Public Works for the time being for Ontario, or an engineer appointed by him; and upon said company thereafter bond fide running said road with all necessary accommodation for the public, and with connection at the track of the Canada Southern Railway Company for one week; the mayor or other head and clerk for the time being, &c., shall forthwith, &c., sign and issue the debentures, &c.
The Chief Justice before whom the case was tried found that the requirements as to time had been complied with, that is to say that the railway had been completed to the Canada Southern Railway before the 30th June, 1883, and that the whole line of railway had been completed within the prescribed period of two years, and further that the company had complied with the last condition that it should bonâ fide run the road with all necessary accommodation for the public and with connection at the track of the Canada Southern Railway C6mpany for one week. As regards the sufficiency of the work, the provisions that the line should be laid with steel rails, and furnished with stations and freight houses and other necessary accommodation attached and connected therewith, and with a station and freight house and switches or sidings at the crossing of the track of the Canada Southern Railway Company so that trains can run off the track of the Erie and Huron Railway Company, upon or parallel with and adjacent to the track of the Canada Southern Railway Company, and the provision as to the platform at this junction with the Canada Southern Railway, and the complete construction of the road in other respects, supplied with all necessary rolling stock and materials all of which was (as in concurrence with both courts below, I construe the by-law) to be done to the satisfaction of the Commissioner of Public Works for the time being for Ontario or an engineer appointed by him, it is sufficient to say that it is all covered by the certificate or report of Mr.
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McCallum the engineer appointed for the purpose by the Commissioner of Public Works. That certificate is as follows:—
This is to certify that on the 23rd day of December, 1884, I made an examination and inspection of the Erie and Huron Railway from Rondeau Harbour to the town of Dresden, and from Dresden to Wallaceburg, and I have in connection with such examination perused the agreement entered into between the Erie and Huron Railway Company and the corporation of the town of Chatham, dated November, 1882, also the by-law of the town of Chatham passed in the month of December, 1882, granting a bonus of $30,000 to the said railway company upon certain terms and conditions.
I find the said railway is completed and at present supplied with all necessary rolling stock and materials, so as to connect as arranged with the Canada Southern Railway Company Blenheim, Chatham, Dresden and Wallaceburgh, and is, in my opinion, ready for the conveyance of freight and passengers.
I also find that the railway company have substantially complied with the terms and conditions regarding work to be performed, required by the said agreement and by-law, except as to the time, as to which I give no certificate as I am not aware of the time limited.
I further find that the platforms provided for by the said agreement and by-law at the crossing of the Canada Southern Railway, were heretofore completed in accordance with the requirements of the said agreement and by-law, but that afterwards a portion thereof was temporarily removed by the Canada Southern Railway for the purpose of enabling the said company to lay a pipe to a water tank and such portion has not yet been restored.
(Signed)OBT. McCALLUM, C.E.,
Engineer appointed by the Hon. theCommissionerof Public Works for Ontario.
It seems to have been assumed that the bridge for foot passengers adjoining the railway bridge was not within the reference to the engineer. In my opinion it was entirely within his competence just as much as the railway bridge itself, and the other works specified by the by‑law, for I read the words “to the satisfaction of the Commissioner of Public Works or an engineer appointed by him,” as applying (as accord-
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ing to the grammatical construction it undoubtedly, does) to all that had gone before, and if this is correct it is covered by the certificate which extends to all the work to be performed required by the by-law, but it seems not to have been so considered by the courts below. They, probably for the reason that this foot-bridge was entirely distinct from the railway works and was an independent matter stipulated for by the town for the convenience of the inhabitants, and that the engineer’s concern in inspecting the road for the purpose of ascertaining the company’s right to receive the provincial bonuses would only be with the railway itself and its appurtenant works, considered the foot bridge an extrinsic matter not coming within the engineer’s competence, and therefore dealt with the question of its sufficient completion as one open upon the evidence. The Chief Justice of the Common Pleas had, however, no difficulty in finding that the terms of the by-law and agreement as regards this foot bridge had been sufficiently complied with; indeed he expresses himself in somewhat strong language as to the objections raised by the defendants on this head, for he speaks of them as follows;—
I am also satisfied that the bridge across the Thames was a substantial compliance with the requirements of the by-law in respect thereto. The approaches were sufficient. The contention of the defendants that the foot bridge should have been continued to Gaol street is not, I think, well founded. Water street if the nearest street to the river and the stairway from the bridge to that street was a sufficient approach, though Water street or a portion of it is sometimes under water, in time of freshet it is a travelled and used highway, and is the street by which the bridge would be ordinarily reached. The contention of the defendants based upon objections to this bridge and the platform at the Southern railway crossing does not appear to me to speak favorably of the business intelligence or honesty of purpose of those who put it forward. It would seem to be an attempt on purely technical grounds to defeat the plaintiff’s claim and to deprive them of the aid which the defendants agreed
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to give them, although by the recital in the agreement it is expressly stated that without such aid the road could not be completed.
In the Court of Appeal the Chief Justice, referring to this point, says:
I think he (the Chief Justice of the Common Pleas) has taken the right view as to the bridge and the four foot way and the company was not bound to connect the bridge on each side with the high ground at some distance from the river.
And the other members of the Court of Appeal seem to acquiesce in this for they say nothing as to it. Even if I had differed very seriously from their findings considered as inferences drawn from the evidence I should not have deemed it proper to interfere with them, for sitting here in a court exercising appellate jurisdiction in the second degree, the authority of the Privy Council in the case of Allen v. The Quebec Warehouse Co. would have seemed to me to preclude the propriety of any such interference on a question of fact on which two courts below had been thus unanimous, in a finding not shown to have been grossly erroneous. But I need not rest the decision on that ground, for the reason assigned by the learned Chief Justice in the passage I have quoted from his judgment entirely commends itself to my judgment, as it will I think to that of every person who considers the evidence. To say that the railway company were bound to carry out the approaches to the bridge to the elevated ground beyond the street traversing the flats immediately adjoining the river would have been to require them to do more than they had covenanted to do, and more than the by-law imposed upon them, for the by-law and agreement only call “for a bridge over the Thames,” and this they have constructed. What the town now insists upon is a bridge not merely over or across the river, but over and across the adjoining
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flats also. Such an enlargement of the obligation of the railway company by mere implication is wholly inadmissible, and therefore I agree with the courts below on this ground also.
The sufficiency and propriety of the engineer’s certificate has been impugned by the defendants upon the ground of want of impartiality. It is alleged that he did not give the defendants notice of his inspection, and that when he went along the line for the purpose of the examination he was accompanied by the company’s engineer. In the first place, this objection is founded on a misconception of the engineer’s duties; he was not an arbitrator or a referee to report either after hearing parties or witnesses, but simply an expert to make an ocular inspection and report on what he saw and not on what he heard; it was his duty to inspect and examine with his own eyes the whole of the line, no matter who accompanied him, and it is to be presumed he performed this duty properly; moreover, he swears he did so.
It is sufficient then to say of this point that it entirely fails on the evidence and that such was the judgment of both the judge at the trial and the Court of Appeal. The Chief Justice of the latter court speaking of the certificate of the engineer and the defendant’s impeachment of his conduct says,
On the best consideration I can give to the point, I think the certificate of the engineer of the substantial completion of the works set out in the by-law sufficiently showed a performance by the company to satisfy its requirements coupled with the actual running of the road for the week. This latter requirement the learned Chief Justice finds to have been complied with, I do not think the defendants have succeeded in impeaching the certificate of the engineer and that the defence, as to that ground, fails.
Therefore all the conditions of the by-law having been expressly found by both courts to have been complied with and the opinion being general in con-.
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formity with the view of the Chief Justice of Appeal who says: “The covenants in the agreements appear to me to be independent and not dependent covenants,” I should have thought it ought to have followed, that the judgment of the Common Pleas Division should have been affirmed without qualification or alteration so far as it related to the original action, that is to say, that the first paragraph of that judgment declaring the plaintiff’s absolute right to the immediate delivery of the debentures and ordering accordingly, and also the second paragraph awarding a writ of mandamus (by which, I, of course understand a mandamus by way of private remedy and not the prerogative writ to be intended) should have stood affirmed and the plaintiffs should have been left free to enforce the judgment to that extent, whatever may have been the opinion of the court as to the propriety of the disposition which the judgment made of the counter-claim. This, however, was not the opinion of the Court of Appeal, for, instead of permitting the original judgment to remain intact, as far as it directed an immediate and absolute delivery of the debentures, it varied the judgment as regards the counter-claim, which by the original judgment had been dismissed, by declaring and ordering that the defendants were entitled to relief by way both of damages and specific performance as regards so much of it as related to the Colborne and William street station, but dismissing it as to the other matters of counter-claim, and the court then proceeded to direct that the order for the mandamus should not be enforced until after the report of the master on a reference as to damages should have been made, and any damages found to be due should be paid, unless the plaintiffs should in the meantime give security to pay the damages or allow them to be deducted out of the debentures.
[Page 274]
The first observation which it occurs to me to make upon this head, is that this variation of the judgment by withholding the debentures until payment of the unliquidated damages, which it was referred to the master to assess, was hardly consistent with the strongly and clearly expressed opinion of the Chief Justice in the passage already quoted from his judgment, that the covenants in the agreement and the provisions in the by-law were entirely independent. If they were so independent, surely to withhold the debentures in this way was to take from the plaintiffs the benefit of such an independence, and to give relief on the footing of dependent covenants, in other words, modifying by the judgment what according to the unanimous judgment of the court was the clear construction and meaning of the contract contained in the two instruments, the by-law and agreement. It was clearly not a case for set oft. There could be nothing of that kind between the two rights of the plaintiffs to the debentures and of the defendant to recover some unliquidated damages in respect of a breach of covenant contained in the agreement of the 3rd November, 1882. I know of no principle either legal or equitable upon which this charging of the prospective damages upon the debentures (for that is what the order of the Court of Appeal really effects) can be supported. No authority has been cited to us either at the bar or in the factum for such a form of judgment or decree and for the reason that it alters the rights of the parties as fixed by contract, I think it cannot be maintained; and I say this irrespective of the proper mode of dealing with the counter-claim, a matter yet to be considered.
As I have said the late Chief Justice of the Common Pleas dismissed the counter-claim, because he thought it could not be conveniently dealt with in conjunction
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with the principal action. Although, on a matter of procedure, with which that learned judge was, of course, much more familiar than I can pretend to be, I should be very unwilling to differ from him, I must say that I have searched in vain for any authority for showing an instance of a counter-claim having been so dealt with at the trial after the evidence had all been taken, and save in very exceptional cases I should think on general principles such a proceeding was to say the least fraught with much danger. Provision is certainly made for striking out a counter-claim which is considered embarrassing in the earlier stages of the action, but the rule does not, (in terms at all events), apply to the trial. Assuming, however, that there was the jurisdiction to strike it out, I agree with the Court of Appeal that the present case was not a proper one for the exercise of such a power. The evidence was all before the court and it was desirable in the interests of all the parties that the question should be at once disposed of, and I incline to think it was just as much the strict right of the defendants at the stage which the action had reached, to have it finally disposed of, as it is the right of a plaintiff in an action to insist upon the trial and adjudication of his cause. This appears to have been the view of the Court of Appeal. The Chief Justice says:—
We can either leave the decree as framed by the learned Chief Justice, or direct a reference on the counter-claim to ascertain the defendant’s amount of damages. I do not see that much will be saved. But, on the whole, I think my learned brother should have decided by reference or otherwise the causes of action in the counter claim which he held established. I do not care generally to interfere with the exercise of a judge’s discretion in such matters, Higgins v. Tweed) but there are reasons, I think, in the case before us, requiring the disposal of the claim of the defendants in the pending suit.
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I am of opinion that this was a proper disposition of so much of the appeal as related to the judgment dismissing the counter-claim.
I cannot, however, bring myself into accord with the Court of Appeal, as regards the proper judgment to be pronounced upon the counter-claim. It should here be stated that the Chief Justice at the trial and also the Chief Justice in the Court of Appeal deal with this counter‑claim, which sets up a variety of heads on which the defendants seek relief, as confined to the single question of the Chatham station, at or near the corner of Colborne and William streets. All the rest, including that portion of it which complains of a breach of the agreement to erect workshops at Chatham, was dismissed by the Court of Appeal, following in this respect the judgment appealed from which dismissed the counter-claim absolutely as to all matters but this station and the right to continue the double track on Colborne street, as to which latter heads the original dismissal was without prejudice though this proviso was applied to other matters by the Court of Appeal. Now, for this dismissal of the counter-claim by the original judgment, the Court of Appeal have substituted the following directions:—
3. And this court doth further declare that the defendants are entitled to a specfic performance of the agreement in the pleadings mentioned as to a station on Colborne street, in the said town of Chatham, as claimed by the defendants in their counter-claim; and doth further order and adjudge that it be referred to a master, to be hereafter named, to ascertain and state the damages (if any) sustained by the defendants up to the date of this judgment in respect of the breach of the said agreement in not keeping open and equipped with all necessary accommodation a freight and passenger station on Colborne street aforesaid, and that as to all other matters referred to in the defendant’s counter-claim, the said counterclaim be and the same is hereby dismissed, without prejudice to any future action or proceedings on the part of the defendants, and that the plaintiffs do pay to the defendants their costs of the said counter claim forthwith after taxation thereof,
[Page 277]
The facts as regards this Colborne and William street station are, if I have rightly apprehended the evidence and the judgment of Chief Justice Cameron, that although it is not placed at the corner of Colborne and William streets it is placed sufficiently near that site to come within the words of the agreement which require it to be placed “at or near the corner of Colborne and William streets.” This is so expressly found by Chief Justice Cameron and as; the Chief Justice of Appeal says:—
I do not see any ground for interference with any of the Chief Justice’s findings of fact either as to the claim or counter-claim;
and as he afterwards adds:—
The learned Chief Justice decided that the company had reasonably complied with the contract in placing the Colborne street station where it now stands;
I take it for granted that as regards the site of the station the Court of Appeal agree with the Chief Justice of the Common Pleas that it was within the terms of the covenant contained in the agreement of 3rd November, 1882.
I apprehend, therefore, that the non-performance of the agreement which the Court of Appeal considered proved, and which it was intended to compel the plaintiffs by their judgment to carry into execution may be distributed as follows: first, the non-user of the station including the providing of ticket sellers, station master and proper officers and servants; and secondly, the sufficiency of the accommodations as regards the buildings and station grounds requisite for freight and passenger traffic. It is to be observed that the judgment of the Court of Appeal does not contain any specific directions as to how this contract is to be performed, beyond referring generally to the counter-claim, in fact it does not do more than declare the right to such relief, it being, I suppose, left to the
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Common Pleas Division to prescribe how this right to specific performance is to be carried out in detail. The words of the order, it will be remarked, are that the defendants are entitled to a specific performance (on this head) as claimed by them in their counter-claim Now, turning to the pleadings, we see that these are very large and comprehensive terms, for the counterclaim asks relief in this respect as follows:—
(c.) That they (plaintiffs) may be ordered to construct and maintain a freight and passenger station with switches, sidings and all other necessary accommodation for the defendants upon lands of or to be purchased by the plaintiffs at or near the corner of Colborne and William streets, and to provide and keep a station master, ticket and baggage officer, and other necessary and ordinary servants of the said company thereat, and to stop all ordinary trains thereat, and not to run such trains past said town without going to, staying at said station for the purpose of taking up and setting down passengers or freight, or both, and that they use and establish such station as the principal and main station for Chatham.
The defendants’ right to retain, as part of the judgment under appeal, this direction for specific performance, and their rights generally under the agreement relating to the station in Colborne street, may be conveniently considered in the following order: It is essential in the first place to determine the true construction of the covenant to erect the station contained in the agreement between the town and the railway company of the 3rd November, 1882, and to ascertain what, according to the true interpretation of the language in which that stipulation is expressed, are the rights of the defendants and the obligations of the company, whether they extend to any thing more than the erection of a station with proper accommodations, whether the plaintiffs in order to comply with its terms are bound to keep the station open, maintain a staff of officers, and run trains as insisted upon by the defendants in their counter-claim, or whether having
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erected a station with all necessary and proper accommodation in the way of buildings and yard room, they are at liberty to use it or not at their own discretion. Next, it is important to inquire how far the contract construed according to its proper legal signification, has been performed and in what respects, if any, it still remains unperformed; and lastly, should it appear that this covenant has not, according to its proper legal construction, been in all respects performed, what relief the defendants are entitled to in respect of such nonperformance, whether they can maintain the judgment directing specific performance, as well as a reference to ascertain damages, or whether they should be restricted to damages.
First, then, as to the proper meaning and construction of the covenant. The clause of the agreement of the 3rd November, 1882, which embodies the terms agreed to respecting the station, is as follows:
And to construct at or near the corner of Colborne and William streets, in the said town, a freight and passenger station with all necessary accommodation, connected by switches, sidings or otherwise with said road of the company, upon the council of said town, within three months from the final passing of said by-law, passing another by-law empowering the said company to make its roads and lay its rails along a highway or highways in the said town to said corner, from where the said road would be if the construction thereof were completed in a direct line through the said town, or upon the said council procuring for and giving to said company a right of way along the northerly side of McGregor’s Creek (one half in the water) for the road of said company to or near said corner and to load from gravel piles, pits or beds purchased by said corporation adjacent to or adjoining the track of said company and carry gravel over said road to any place required by the said town for the construction, maintenance and repair of public roads in said town and for other purposes of the town for a sum and at a rate for loading and carriage not to exceed three cents per cubic yard of gravel per mile, for all distances less than ten miles and two cents per mile for all distances of ten miles and over but under twenty-five miles, and one-and-a-half cents per mile for all distances of and over twenty-five miles.
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Does then a covenant to construct a freight and passenger station, at or near a specified site, with all necessary accommodation, involve a liability, on the part of the railway company so covenanting, to run its trains to the proposed station? If the question was not concluded by authority I should with great deference to the learned judges of the Court of Appeal have thought there could as a matter of construction, according to the plain and ordinary meaning of language, be little difficulty in answering it in the negative. The obligation undertaken by the company being “to construct” and no liability beyond that being in terms imposed upon them, if this obligation is to be enlarged beyond the literal meaning of the words used, it can only be by incorporating some wider undertaking by implication—but what warrant either on principle or authority is there for thus supplying terms by implication in such a case. In what respect does it differ from reforming and remodelling the contract, which is, of course, no part of the duty of a court called on to construe it, thus to speculate on what the intention must have been and to arrive at a conclusion by balancing the utility of the literal construction against that contended for by those who seek to enlarge it? Surely such a mode of dealing with a contract is something more than interpreting the mere words in which the parties have expressed themselves, which we are told by the best authorities ought to be the limit which should bound the jurisdiction of a court of construction. The sound policy of holding parties fairly to the meaning of the language they have used, unless they are able to show fraud or error, considerations which, of course, are altogether out of place here, is, I think, obvious, when it is considered that if the courts were once to admit a mode of interpretation which should permit the
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addition of terms by showing that without them the contract literally construed would be of little use, the greatest uncertainty would be introduced into transactions, and legal interpretation would soon degenerate into conjecture. I maintain, therefore, that when a railway company covenants to erect a station it is bound to build the station, but not to do more. It may well be that the defendants might reasonably have considered it improbable that the railway company would require more than one station at Chatham, and that they would therefore, if compelled to erect this one on the corner of Colborne and William streets, not incur the expenditure of another but content themselves with this, as their only station at Chatham and use it accordingly. But if they speculated on these probabilities, and trusted to the railway company acting in accordance with what it then appeared would be to their interest, that does not constitute any ground for enlarging the words by construction and giving the defendants the benefit of what they never stipulated for. The case, however, is really concluded by that of Wilson v. Northampton & Banbury Junction By. Co., for with great deference I cannot see the distinction between that case and the present which the learned Chief Justice of Ontario seems to recognise. In the case cited the covenant was “to erect, fit up and construct the station, &c.,” and it was distinctly held that no stipulations as to the use of the station were to be implied from such a covenant. The language of the covenant there, it will be observed, is almost identical with that now under consideration. The words “all necessary accommodation” cannot possibly enlarge the scope to the extent contended for as warranting the implication of something not expressed, namely, a covenant to use and
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run trains to the station, and if these words make no difference the cases are identical. I am of opinion that the interpretation of this covenant contended for by the defendants is inadmissible, and that at the utmost it only bound the railway company to build and erect a station with the necessary buildings and yard room for passenger and freight traffic. Further, that as the company were not bound to run trains to or to make any other use of the station, they are not bound to maintain a staff of officers or servants there.
Next such being, in my opinion, the proper meaning of the company’s stipulations the question remains whether construed in this sense, it has been sufficiently performed. The learned Chief Justice of the Common Pleas in the written opinion with which he accompanied his formal judgment seems to say that in his view the company had failed of performance in two respects, one being that they did not keep a proper staff of officers and servants at the station, viz., station master, ticket agent, freight agent, &c. In the view I take, these are not omissions of any agreement binding on the company, for, as already pointed out, they were not in terms bound to provide such officers, and their employment could only be as incidental to the use of the station, and I hold they were under no obligation to run trains or make any other use of it. But the Chief Justice also considered that proper accommodation had not been provided for loading and unloading freight. The learned judges own words are as follows:—
I am of opinion on the evidence that the station accommodation on Colborne street is not sufficient to answer the requirements of the plaintiffs’ covenants, that that station has not been kept open in the usual manner in which stations are kept open for the convenience of the public, and that there should be kept there a person to sell tickets and check baggage at reasonable times before the arrival and departure of trains.
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So far I am unable to agree with the learned judge for the reasons already given, but he proceeds:—
There is no present accommodation for loading or unloading of freight within the yard or grounds of the company and the use of the street for that purpose is an unauthorized use.
I think the words “all necessary accommodation” do require that in addition to suitable buildings to serve as passenger and freight stations and sheds appropriate station grounds and yards should be provided such as would be reasonably sufficient for all the purposes of freight and passenger traffic if the station were in constant and regular use. These, however, have not, according to the Chief Justice, been provided by the company. The Chief Justice having dismissed the counter-claim, his opinion in this respect is not to to be received as a formal finding, but from the evidence I think it may be gathered that his opinion in this respect, though not formally obligatory upon the parties, may well be adopted as a proper inference from the evidence.
Then what should be the relief in respect of this default of performance by the railway company to provide suitable station grounds? The case of Wilson v. Northampton Ry. Co. is here again in point, for it shows that the appropriate relief in such a case is not specific performance, but damages. What use would it be to any one to compel the railway company to buy land and acquire station grounds which they could not afterwards be compelled to make use of? It is manifest therefore that just as in Wilson v. Northampton Ry. Co. a remedy in damages will be more likely to do justice than a decree or judgment for specific performance. All the arguments which Lord Selborne in that case uses in pronouncing for a reference to assess damages in preference to a decree for
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specific performance apply with at least equal force in the present case, and I have therefore no hesitation in following that decision.
In my opinion, the order of the Court of Appeal should be discharged and the judgment of the Common Pleas Division should be varied by striking out the third paragraph and in lieu thereof substituting a declaration of the proper construction of the covenant contained in the indenture of the 3rd November, 1882, respecting the Colborne Street Station in accordance with the opinion regarding the construction before expressed, followed by a direction that it be referred to a master to ascertain what damages had been sustained by the defendants by reason of proper accommodation for the loading and unloading of “freight,” not having been provided by the railway company, and directing the master in making such enquiry to have regard to the declarations to be inserted in the judgment respecting the construction of the stipulation in question as before indicated, and by which declaration it will of course be made to appear that the defendants are not entitled to compel the plaintiffs to run trains to the station or to keep up a staff of servants and officers there. Subject to the foregoing directions the counterclaim should be absolutely dismissed.
As to costs, the plaintiffs should recover the costs of the original action up to the first judgment. There should be no costs of the counter claim, for whilst to some extent the defendants succeed on it, they also to a great extent fail. There should be no costs of the appeal to the Court of Appeal as that was rendered necessary by the error in dealing with the counter claim by the judge of first instance. The appellants should recover their costs in this court. The subsequent costs which will be involved in the reference as to damages should be reserved until after the report.
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FOURNIER J. concurred in the judgment of the Court of Appeal.
TASCHEREAU J.—I concur with Mr. Justice Gwynne.
HENRY J.—I concur in the judgment of the Chief Justice and Mr. Justice Strong with certain differences. I do not think the evidence sufficient to justify a reference, but the counter claim should be dismissed with a reservation to the defendants of their rights.
GWYNNE J.—Upon the facts appearing in evidence I am of opinion that the by-law—the agreement of the railway company with the corporation of the town of Chatham, of the date of the 3rd November, 1882, and the agreement between the railway company and the plaintiff, Bickford, which now bears date the 4th December, 1882, must be all read together for the purpose of determining the true agreement, the fulfilment of the terms of which constituted conditions precedent to the accruing of the right of the railway Co. to receive the debentures of the town of Chatham, authorized by the by-law.
It is said that the by-law and the agreement of the 3rd November, 1882, must be read as wholly independent instruments, having no connection with each other, upon the ground that, as is contended, the contract in the by-law is made between wholly different parties from the parties to the agreement of November, 1882, the ratepayers of the municipality being, as is contended, the parties to the by-law, and the municipality in its corporate capacity the parties with whom the agreement of November, 1882, is entered into. But there is no foundation for this contention for although the approval of the by-law by a majority of the ratepayers voting thereon must be obtained before the by-law can have any validity yet the by-law itself
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is an act of the corporation. It can only become a by-law by the assent of the council of the municipality. It must have the assent of the council before it can be submitted to the ratepayers, it must be first read in the council, and approved by the council to be submitted to the ratepayers and after being approved by the ratepayers it must be read a third time and passed by the council before it becomes a by-law. The corporation of the municipality is therefore the party with whom the contracts in both instruments were entered into. The agreement of November, 1882, recites that it was entered into for the express purpose of obtaining upon the faith of it the assent of the council of the municipality to the introduction of the by-law and to submitting it to the ratepayers and eventually passing it if approved by a majority of ratepayers voting upon it, and, moreover, the evidence shows that this agreement was used as a special lever by which the assent of the ratepayers to the by-law was obtained. It is, however, the council of the corporation which passes the by-law. Both instruments are entered into with the corporation and the one is expressly based upon the other, so that both must, in my opinion, be construed together as forming one complete agreement.
The agreement between the railway company and Bickford notwithstanding that it now bears date the 4th December, 1882, was, in truth the foundation upon which the agreement of the 3rd November, 1882, and the by-law rest. The object of passing the by-law in fact appears to have been to give effect to this agreement between the railway company and Bickford. The evidence shews that both this agreement and that of the 3rd November, 1882, were printed and distributed among the ratepayers before the by-law was submitted, and that at a public
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meeting or public meetings, held in the town for the purpose of inducing the ratepayers to vote for this by-law Mr. Bickford, as indeed he himself admits, assured them that if the bonds should be carried he would perform everything in his agreement with the company (which was then executed conditionally) and in the agreement of the 3rd of November, 1882, and in the by-law. There can, I think, be no doubt that as this was done for the express purpose of influencing the ratepayers in approving the by-law, their approving it is fairly attributable to the matters contained in the agreement, the fulfilment of which was so assured. The by-law referred to in the agreement of the 3rd November was submitted for the consideration of the ratepayers on the 22nd November, 1882, and the day appointed for voting thereon was the 21st December, 1882. A public meeting at which it is established that Mr. Bickford gave the above assurance was held on the 27th November. His agreement with the company which he admits was then already made conditionally was not, it appears, executed under the seal of the company and of Mr. Bickford until the 4th December, of which day it now bears date just seventeen days before the voting on the by-law.
By this agreement, after reciting among other things, that the said Bickford had agreed to commence the completion of the said road, (namely a railway which commenced at Rondeau Harbor in the county of Kent, and running from thence to the village of Blenheim, thence to the town of Chatham, thence to the village of Dresden, with a branch to the village of Wallaceburgh) so soon as the municipalities of Chatham, Blenheim, Dresden and Wallaceburg have voted additional aid to the company to the amount of seventy thousand dollars, and upon the understanding that the company
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should at the time thereinafter mentioned issue and allot to the said Bickford one thousand fully paid up shares of the capital stock of the said company being to the amount of one hundred thousand dollars, and that the said company should agree not to issue any stock beyond the amount then standing in the names of shareholders (but not including that held by Solomon M. Knapp,) and the amount to be issued to the said Bickford as aforesaid without the consent in writing of the said Bickford, and should further agree to hand over to the said Bickford when the same should be received by them, the moneys derived from the government and municipal bonuses or aid, or to authorize the said Bickford to receive the same when payable to the company, and also to deliver first mortgage bonds of the said company to the amount of ten thousand dollars per mile at the time and in the manner thereafter mentioned, the said Bickford covenanted with the company subject to the aforesaid provisions as to the granting of municipal aid and subject to the legislature extending the time as therein provided, that for the consideration therein mentioned he would (among other things) well and truly and in good workmanlike manner, build, construct and finish that portion of the Erie and Huron Railway, commencing at Rondeau and from thence to or near the village of Blenheim, thence via the town of Chatham to or in the village of Dresden, with a branch to the village of Wallaceburg, according to plans and profiles of location already prepared and registered to be one continuous road or line, and that he will furnish and provide such right of way for the said railway in width 50 feet as has not already been purchased, and will also provide the requisite station grounds on said railway at Rondeau, Blenheim, Southern Railway crossing, Chatham, Dresden, Wallaceburg and such intermediate
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stations as are requisite for the proper working of the said railway as the traffic may demand. And will also build a strong and substantial pier of timber work or masonry for the bridge crossing the river at Chatham, with all suitable approaches on each side of the river for railway crossing (to include a footway along one side thereof of not less than four feet in width) the (bridge to be of iron, steel or wood with all necessary wrought iron stays and braces, &c., &c., and will also build suitable stations at each of the said towns and villages and intermediate places as may be necessary for the traffic of the said railway, with platforms and water closets suitably painted. Also, will build one engine stable and all requisite conveniences for water at Chatham and the company’s workshops suitable to its requirements at the same place; also will build two turn-tables and grade over all sidings of stations and station grounds, and will build and fully complete the said road in a good and workmanlike manner, and erect stations equal to those of the Credit Valley railway. The agreement then after the insertion of claims providing for the consideration to be paid by the company, proceeds as follows:—
It is also understood and agreed that notwithstanding anything herein mentioned, the said Bickford shall not be bound to commence the building of the said road or the purchase of the right of way or do anything in connection with this contract unless nor until the additional aid to the amount of $70,000 is granted by the town of Chatham and Dresden and the villages of Blenheim and Wallaceburgh, nor unless the said company shall procure an extension of time until the 1st day of March, 1884, for the completion of that portion of the said road between Rondeau and Dresden, including the Wallaceburgh branch.
It is further provided and agreed that it shall be a condition precedent to the said Bickford entering on and completing the said contract that the corporation of the town of Chatham grant the right of way down McGregor street, in said town, and it is hereby agreed that the station and proper buildings shall be erected at the inter-
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section of the railway with King street in the town of Chatham; provided always that if the corporation of the said town of Chatham desire that said station shall be further up in said town, the station will be so placed if the right to lay the track up Colborne street be granted to the company.
Now, from this agreement it is obvious that but one station in the town of Chatham which should be suitable for all the requirements of traffic in the town was in the contemplation of the parties to this agreement. The company bargained for and Bickford contracted to provide but one station for the town of Chatham, and it was agreed that such station should be equal to the stations on the Credit Valley railway, and that the sidings of the station grounds, and the stations should be graded, and that Bickford should provide the necessary station grounds, and that such station should be erected at the intersection of the railway with King street only in the event of the corporation of the town not desiring that the said station should be further up in the said town and not granting to the company the right to lay their track up Colborne street; but in the event of the corporation of the town requiring the station to be further up in the town than at the intersection of the railway with King street and of their granting to the company the right to lay their track up Colborne street, then their station for the town of Chatham suitable for all the requirements of the traffic at the town should be placed where the corporation of the town should require it to be placed.
[His Lordship then read the recitals and conditions of the agreement between the railway company and the town, the material portions of which are set out on page 238.]
The agreement as to the station being at or near the corner of Colborne and William street is not mentioned
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in the by-law, as, indeed, it could not be for the reason pointed out by Mr. Justice Patterson in the Court of Appeal for Ontario, namely, that it rested with the corporation of the town, whether or not they should require the station to be located there, and in case they should, that they had three months after the passing of the by-law within which to pass the necessary by-law granting to the company the right to lay their track up Colborne street for the purpose. But although not in the by-law, it was by the agreement, upon the faith of which the by-law was passed, made an express condition that in case the corporation of the town should grant to the company such right to lay their track up Colborne street, the station should be located there, and by that agreement upon the faith of which the by-law was passed, the location of the station there, in the event aforesaid, became in my opinion as much a condition precedent to the accruing of the company’s right to receive the debentures as if it had been inserted in the by-law.
It would, in my opinion, be monstrous if the fulfilment of a covenant entered into for the express purpose of procuring the by-law to be passed should not, on the purpose being obtained, be held to be a condition precedent to the accrual of a right to receive debentures authorized by a by-law which was passed only on the faith of the due fulfilment of the covenant. To say that although the covenant has been broken the corporation of the town has no remedy, but by an action to recover such damages as they may be able to prove that the corporation has sustained would be a mere mockery of justice; for, in such case, such an action could not possibly afford any adequate remedy. All the judges of the courts below are of opinion that the covenant has been broken. The corporation were then entitled to the fulfilment of it, and if entitled to the
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fulfilment of it, the erection of the station with all necessary conveniences, &c., being a part of the work necessary to the completion of the work, it was necessary that it should have been executed within the time specified for the completion of the road with stations, freight houses, and other necessary accommodation attached and connected therewith before the company became entitled to the debentures. The agreement of the 3rd of November entitled the corporation of the town of Chatham to the station at or near the corner of Colborne and William street conditional upon their granting the right to the company to lay their track upon Colborne street. The corporation did grant to the railway company this right and thereupon became entitled to have the station with all necessary conveniences constructed there, notwithstanding any difficulty or expense there might be attending its being located there. The agreement between the company and Mr. Bickford, of the fulfilment of which the corporation and the ratepayers were assured in order to induce them to pass the by-law, shows what kind of a station was contemplated by the agreement of the 3rd November, between the company and the town, namely, that it was to be the one station to be provided for the town, and that it should be sufficient for the requirements of all the traffic at the town, and that it should be equal to the stations on the Credit Valley Railway. There was no uncertainty whatever as to the character of the station, and the necessary conveniences attached and connected therewith which were to be supplied in order to the due fulfilment of the company’s covenant. The provision as to the certificate of the Government Engineer has no relation to this part of the agreement: that related to the completion of the road in all other respects than those special-
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ly provided for between the company and the town, and plainly related to a completion of the whole line to the satisfaction of the Commissioner of Public Works or as to be capable of being opened for traffic, and to entitle the company to the government subsidy. Now the company in fulfilment of the agreement as to procuring an extension of time for completing the work which Mr. Bickford had in his agreement with the company, made a condition precedent to his undertaking the work, procured an act of the Legislature of Ontario to be passed in the month of February, 1883, granting the required extension of time, 46 Vic., ch. 52.
There is a clause in that act which appears to me to have a material bearing upon the circumstance that the whole of the agreement between the company and the town upon the faith of which the by-law was procured to be passed, namely, that part relating to the location of the Chatham station was not inserted in the by-law. I am unable to understand for what purpose the clause could have been inserted unless with intent to have the bearing I have alluded to.
The 2nd clause of the act enacts that the several agreements entered into between the said company and the different municipalities passing by-laws granting aid by way of bonus to said company before the passing of such by-laws in consideration or in consequence of which agreements the said by-laws were voted upon or passed and the agreement between the said company and Edward Oscar Bickford for the construction of the said railway are hereby declared to be valid and binding upon all parties thereto from the time of execution thereof.
It cannot have been supposed that there was any occasion to pass an act to make valid, agreements between parties competent to enter into the agreements referred to, and it is not suggested that there was anything illegal or ultra vires in the agreements
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referred to, which rendered necessary legislative interference to make them valid.
The clause, however, declares all agreements between the company and municipalities for granting bonuses in consideration of which or in consequence of which by-laws granting such bonuses have been. passed and voted upon and the agreement between the company and Bickford to be valid and binding on all parties thereto.
Now as it is clear from the evidence that the by-laws of the town of Chatham granting the bonus in question here was submitted to the ratepayers and voted upon and passed by the corporation upon the faith of the agreements of the 3rd November, 1882, and upon the assurance of the plaintiff Bickford that all its provisions as well as all the provisions of his agreement with the railway company should be faithfully fulfilled in every particular if the bonuses should be granted, I think that this clause was inserted for the purpose of assuring municipalities who had passed by-laws upon the faith of such agreements that they should have the same protection as if the provisions of these agreements were inserted in the by‑laws.
However that such a clause was at all necessary for such a purpose, I am by no means prepared to admit, for I am of opinion that it is the duty of a court required to administer justice according to equity and good conscience to give effect to all agreements, verbal or written, upon the faith of which the by-law under consideration here was procured to be passed, and but for which it never would have been passed as I think is the true conclusion to draw from the evidence. It is, in fact, the common equity arising out of the fact that the whole agreement is not to be found in one instrument, but in several, or the case of an agreement
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induced to be entered into by the assurances and promises of the party claiming the benefit of the agreement, which assurances and promises, if not fulfilled, would operate as a designed fraud upon the other party. So thinking, I am of opinion, that the covenant of the railway company as to the station in the town of Chatham at or near the corner of Colborne and William streets has been clearly broken, and that the fulfilment of it was a condition precedent to the accrual of the right of the company, or Mr. Bickford to receive the debentures sued for, and that this condition not having been fulfilled within the time specified for “the completion of the road with stations and freight houses and other necessary accommodation attached and connected therewith,” all claim upon the town corporation for the debentures is gone.
I am of opinion, also, that a foot way along side of the bridge over the river Thames has not been supplied within the meaning of the covenant in that behalf. The cutting it short before reaching the high bank of the river and dropping down by steps to flats, which every spring and autumn are covered by the waters of the river is not, in my opinion, a fulfilment of the covenant in respect of a foot way for passengers requiring to cross the river by the bridge. That foot way should, in my opinion, have been made, as is provided in the agreement between the company and Bickford, along the necessary approaches to the bridge as well as along side of the bridge proper.
Our judgment, in my opinion, should be to dismiss the appeal of the plaintiff with costs, and to allow the cross appeal of the defendants with costs and to order
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the claim of the plaintiffs in the court below to be dismissed with costs.
Owing to the difference in opinion among their Lordships the appeal and cross-appeal were dismissed without costs.
Solicitors for appellants: Blake, Lash, Cassels & Holman.
Solicitors for respondent: Robinson, Wilson, Rankin, & McKeough.
25 Gr. 93; 3 Ont. App. R. 44.
7 Ed. Vol. 1 pp. 39, 40, 41.
L.R. 8 Eq. 666; 5 Ch. App.525.
See Blackett v. Bates 1 Ch. App. 117.
1. Ch. App, 117, per Lord Cranworth.
The appellants applied to case which was refused. See the Privy Council for leave to Canadian Gazette, Vol XIV p. appeal from the decision in this 153.
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