Supreme Court of Canada
In re Branch Lines Can. Pac; Ry. Co. (1905) 36 SCR 42
Date: 1905-04-06
In The Matter of "An Act Respecting The Canadian Pacific Railway," 44 Vict. Ch. 1, and The Construction of the Sudbury Branch of the said Railway.
The Canadian Pacific Railway Company
Applicants
And
The James Bay Railway Company
Contestants
1905: Mar. 17, 20, 21; 1905: April 6.
Present:—Sedgewick, Girouard, Davies, Nesbitt and Idington JJ.
ON A REFERENCE FROM THE BOARD OF RAILWAY COMMISSIONERS FOR CANADA.
Railways—Branch lines—Canadian Pacific Rway. Co's. charter—44 V. c. 1, (D), and schedules—Construction of contract—Limitation of time— Interpretation of terms—"Lay out", "Construct", "Acquire" — "Territory of Dominion"—Hansard debates—Construction of statute— "The Railway Act, 1903."
The charter of the Canadian Pacific Railway Company, [44 Vict. ch. 1, (D.)] and schedules thereto appended imposes limitations neither as to time nor point of departure in respect of the construction of branch lines they may be constructed from any point of the main line of the Canadian Pacific Railway between Callender Station and the Pacific Sea board, subject merely to the existing regulations as to approval of location, plans, etc., and without the necessity of any further legislation.
On a reference concerning an application to the Board of Railway Commissioners for Canada for the approval of deviations from plans of a proposed branch line, under section 43 of "The Railway Act, 1903 it is competent for objections as to the expiration of limitation of time to be taken by the said Board, of its own motion, or by any interested party.
Special CASE submitted by the Board of Railway Commissioners for Canada for hearing and consideration, under the provisions of the forty-third section of The Railway Act, 1903.
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The statement of the case was as follows:—
"1. The Canadian Pacific Railway Company was incorporated in 1881 by Letters Patent issued by the Governor General under the Great Seal of Canada pursuant to section 2 of the Act 44 Victoria, chapter 1.
"2. The said Letters Patent are in the form set forth as schedule A to the said Act and the contract between Her late Majesty and the syndicate whose rights were subsequently acquired by the Canadian Pacific Railway Company, is also set forth as a schedule to the said Act, which will be found in the statutes of Canada for the year 1881 on pages 3 to 30 both inclusive.
"3. On 14th November, 1902, the said company deposited in the Department of Railways and Canals at Ottawa a map and plan of a proposed branch line of railway from a point near Sudbury, on the company's main line of railway, to a point near Kleinburg, on the Ontario and Quebec Railway, all in the Province of Ontario, together with profile and book of reference.
"4. On the 18th day of November, 1902, the said map and plan, profile and book of reference were duly sanctioned by the Minister of Railways as appears by his certificate indorsed thereon.
"5. Subsequently an application to the Board of Railway Commissioners for Canada was made by the Canadian Pacific Railway Company for the approval of certain deviations from the said proposed route.
"The James Bay Railway Company was incorporated by statute 58 & 59 Victoria (Canada), chapter 50 and thereby authorized to construct a railway from Parry Sound in the Province of Ontario to French River, thence northerly to the easterly side of Lake Wahnapitae and thence to James Bay, and by statute 60 & 61 Victoria (Canada), chapter 47 the James Bay Railway
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Company was authorized to extend its line from Parry Sound to the City of Toronto or to a point adjacent thereto.
"7. Upon the said application to the Board of Railway Commissioners, the James Bay Railway Company filed a protest with the said Board, and being notified of the hearing of the application by the said Board appeared and objected to the approval of the said deviations upon the ground that the Canadian Pacific Railway Company had no power to construct the branch in question for two reasons::—
"(a) That the period within which branch lines of railway could be constructed by the Canadian Pacific Railway Company under its statutory and charter authority had expired; and—
"(b) That no such authority empowered the construction, at any time, of branch lines in the Province of Ontario.
"The following questions, being in the opinion of the said Board of Railway Commissioners questions of law, are submitted by the said board for the opinion of the Supreme Court of Canada:
"I. Has the Canadian Pacific Railway Company, under the legislation, schedules and charter aforesaid, now power to construct the branch line referred to, or has the time expired within which such branch line might be constructed?
"II. Do such legislation, schedules and charter authorize construction by the said company of the proposed branch line, it being altogether situated in the Province of Ontario?
"III. Is it open to the James Bay Railway Company or to the Board of Railway Commissioners to take the objection that the time within which the said company may build branch lines under its charter has expired?
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"8. All statutes and orders-in-council, also the said maps, plans, profiles and books of reference may be referred to on the argument of the case subject to all objections as to their admissibility in evidence.
"9. All the statements in the schedule hereto for the purpose of this reference are admitted by the parties to be correct and may be used on the argument subject to all objections as to their admissibility in evidence.
"SCHEDULE."
"REFERRED TO IN THE FOREGOING STATEMENT OF CASE."
"(1) At the date of the Canadian Pacific Railway Charter (1881) the territory through which its main line was to be constructed was, with the exceptions to be mentioned, almost completely uninhabited and Only by its general characteristics had become known to the people of Canada. The exceptions to this statement are:—
"(a) A small settlement existed at Port Arthur and Fort William:
"(b) Southern portions of the Province of Manitoba and as far west at the present western boundary of the Province had been surveyed and were sparsely settled, particularly in the neighborhood of Rat Portage and the Red River District where the "Winnipeg settlement was:
"(c) Some portions of the country between such western boundary and British Columbia had been surveyed into blocks of sixteen townships each:
"(d) A small settlement on the British Columbia coast.
"(2) From year to year after the date of the contract the Government of the Dominion of Canada caused portions of Manitoba and the Northwest Territories to be surveyed and set off into townships and sections
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but it was not until the year 1901 that the last of the townships in the North/West Territories and western part of Manitoba through which the railway runs was surveyed and set off into sections. Some of the territory in the eastern part of Manitoba and the western part of Ontario, and in British Columbia, together with large tracts in Manitoba and the North-West Territories through which branch lines of the Canadian Pacific Railway may at some time run (if the contentions of the Canadian Pacific Railway in in question herein are sustained) have not yet been surveyed even into townships by the Government.
"(3) At the date of the Canadian Pacific Railway charter the main line of the railway north of Lake Superior had been projected to run some distance north of the Lake and join the line between the Lake and Selkirk. The accompanying sketch marked Plan No. 1, (partial copy of a map attached to the report of the then Engineer-in-Chief of the Department of Railways—Mr. Sandford Fleming—dated 26th April 1878), shows the projected junction of the eastern and Lake Superior sections of the railway and the line to Fort William as then contemplated. After that date the route of the main line was changed. The part of it lying north of Lake Superior was brought more to the south so as to skirt the Lake and the western end of the eastern section was made to join the eastern end of Lake Superior section at or near Fort William as shown in the accompanying sketch marked Plan No. 2 which is a partial copy of a map.
"(4) Prior to 1st May, 1891, the Canadian Pacific Railway Company, without any other legislative authority than that contained in the legislation of the Parliament of Canada appearing in the said statute 44 Vict., ch. 1, and the schedules thereto and the charter issued in pursuance thereof, constructed and
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equipped the branch lines of railway or extensions of branches in List A, in paragraph 5. hereof. Subsequent to said first May, 1891, the Canadian Pacific Railway Company have constructed, without any such other authority, the branches or extensions of branches set out in List B in paragraph 5 hereof. In respect of the branches or extensions of branches set out in the said lists, those which are accompanied by the word "(Inspected)" were inspected by a Government Engineer and permission granted to the Company to open such branches respectively for the public conveyance of passengers.
(5) For the information of the court the following lists have been prepared:—
"LIST A"
BRANCHES OF THE COMPANY'S MAIN LINE CONSTRUCTED PRIOR TO MAY 1st, 1891."
"1. Ontario: The Algoma Branch from Sudbury to Sault Ste. Marie, 18.2.1 miles. Constructed 1883-6 (Inspected).
"2. Ontario: The Stobie Branch from Sudbury to Copper Mines, 5 6 miles. Constructed 1887.
"3. British Columbia: The New Westminster Branch from New Westminster Junction to New Westminster, 13 7 miles. Constructed 1887. (Inspected).
"4. British Columbia: The Port Moody Branch from Port Moody to Vancouver, 13 miles. Constructed 1887.
"5. Manitoba: The Pembina Mountain Branch from Winnipeg to Manitou, 110.1 miles. Constructed 1882. (Inspected).
"6. Manitoba: The Gretna Branch from Rosenfeld to Gretna, 13 7 miles. Constructed, 1882.
"7. Manitoba: The Selkirk Branch from Winnipeg to West Selkirk, 24 miles. Constructed 1883. (Inspected).
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"LIST B. "
"BRANCHES CONSTRUCTED SUBSEQUENT TO MAY 1st, 1891."
"8. Ontario: The Dyment Branch from Dyment to Ottamine, 7 miles. Constructed 1900. (Inspected.)
"9. British Columbia: The Mission Branch from Mission Junction to Mission, 10 miles. Constructed 1895.
"10. British Columbia: The Arrow Lake Branch, from Revelstoke to Arrowhead, 27.7 miles. Constructed 1897.
"11. British Columbia: The Coal Harbour Branch from Vancouver to Coal Harbor, 1.2 miles. Constructed 1903.
"12. Manitoba: An extension of the Stonewall Branch, from Stonewall to Teulon, 19 miles. Constructed 1898. (Inspected.)
"13. Manitoba: The Lac du Bonnet Branch from Molson to Lac du Bonnet, 27 miles. Constructed 1900. As to this branch the Dominion Statute 63 & 64 Vict., ch. 55, sec. 3, gives such authority as is contained in that section, (Inspected.)
"14, Manitoba: The McGregor Branch from McGregor to Brookdale, 36 miles. Constructed 1900-02, As to this branch the Dominion Statute 63 & 64 Yict., ch 55, sec. 3, gives such authority as is contained in that section. (Inspected.)
"15 Manitoba: Extension of Souris Branch from Souris to Glenboro, 45.7 miles. Constructed 1891-2. (Inspected.)
"16. Manitoba: Extension of Souris Branch from Napinka to Deloraine, 18.6 miles. Constructed 1892.
"17. Manitoba and North-West Territories: The Pheasant Hills Branch from Kirkella in Manitoba to
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Haywood in the North-West Territories, 146 miles. Constructed 1903-4. (Inspected.)
"18. Manitoba and North-West Territories: The Souris Branch from Kemnay to Estevan, 156.2 miles. Constructed 1891-2. (Inspected from Kemnay to Melita.)
"19. North West-Territories: The Portal Branch from North Portal to Pasqua, 160.3 miles. Constructed 1893."
The statement then referred to Dominion legislation and action respecting subsidies for branch lines or extensions thereof constructed by the Canadian Pacific Railway Company under its charter; and certain Parliamentary references thereto, that is to say;
As to the Algoma Branch, in Ontario:— 47 Vict., ch. 1 (sanctioning a Government loan), sec. 5. (At this time the Algoma Branch Line had been constructed to Algoma on the Georgian Bay.)—48 & 49 Vict., ch. 57, secs. 1, 3 and 10; 49 Vict., ch. 9, secs. 2 and 3; 50 & 51 Vict., ch. 56, sec. 4. The Company enacted bylaws in connection with the issue of the branch bonds, and, on 19th May, 1887, an order-in-council was passed approving of such by-laws.
As to the Dyment Branch, in Ontario, 63 & 64 Vict., ch. 8, authorized a cash subsidy. "The subsidy has been paid by the Dominion Government to the Canadian Pacific Railway Company. The subsidy agreement between the Crown and the company, dated 28th August, 1902, and signed on behalf of Her Majesty by the Acting Minister of Railways, contains the following recital:—'Whereas the company was incorporated and authorized to build the railway hereinafter mentioned by the Act or Acts following, namely, Canada 1881,chapter 1, section 14' This section is the clause in the company's original charter authorizing the construction of branch lines."
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As to the Arrow Lake Branch, in British Columbia. 55 & 56 Vict., ch. 5, sec. 3, authorized a cash subsidy. "The subsidy has been paid by the Dominion Government to the company."
As to the Pheasant Hills Branch, in Manitoba and North-West Territories, by 3 Edw. VII., ch. 57, a cash subsidy was authorized. "Nearly all of this subsidy has been paid by the Dominion Government to the Canadian Pacific Railway Company. The subsidy agreement is dated 14th January, 1904, and the recital contains a reference to the company's original charter similar to that in the Dyment Branch."
As to the Souris Branch, in Manitoba and North-West Territories, by 53 Vict, ch. 4, sec. 1, "the Governor-in-Council may grant subsidies in land hereinafter mentioned to the railway companies and towards the construction of the railways also hereinafter mentioned, that is to say:—To the Canadian Pacific Railway Company, Dominion lands to an extent not exceeding six thousand four hundred acres per mile for a branch line to be constructed from Glenboro' westerly a distance of about sixty miles, to a point on the proposed branch railway of the said company running from Brandon, south-westerly.—To the Canadian Pacific Railway Company, Dominion lands to an extent not exceeding six thousand four hundred acres per mile for a branch line of railway from a point at or near Brandon, on the main line of the Canadian Pacific Railway, south-westerly to or near township three, range twenty-seven, west of the first principal meridian, and thence westerly a total distance of one hundred miles; and also a similar grant, at the same rate per mile, for the said company's proposed branch railway from a point on the line just described at or near township three, range twenty-seven, west of the first principal meridian, easterly to Deloraine, a
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distance of about twenty-five miles,—making the total length of railway to which this grant is applicable one hundred and twenty-five miles."
"The order-in-council of 18th of May, 1899, providing for this grant of land states that: 'It is the intention of the company to build these extensions under the powers conferred upon It in relation to the building of branch lines.' The order-in-council of 7th February, 1891, sets apart the reservation of land required to meet the above grant. Orders-in-council were made in 1890 and in 1891 (after 1st May) extending the time for completing this branch. The order-in-council of 24th August, 1894, provides for a land grant of 6,400 acres per mile, for the extension of the Souris Branch from a point in the vicinity of Souris in a westerly direction, a distance of about 32 miles. The order-in-council of 22nd August, reports that the company has earned 1,408,704 acres of land by the construction of the Souris Branch and provides for grants thereof; 54 & 55 Vict., ch. 10 authorizes the Governor in Council to grant the land subsidies for another branch in Manitoba; 54 and 55 Vict., ch. 71, "authorizes the issue of Consolidated Debenture Stock to use in acquiring or satisfying bonds issued in respect of the Souris Branch and contains the following words in sub-section (a) of section 1; The company being at the time of the passing of this Act empowered by its charter to construct the same.' All this stock has been issued and sold by the company and is now outstanding."
The statement continues:—
"The only reference in the statutes to the Sudbury Line is contained in 51 Vict. ch. 51 (1888), which is the Act increasing the company's bonding powers on branch lines from $20,000 to $30,000 a mile. The preamble to this Act is as follows:—"Whereas the Canadian
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Pacific Railway Company has, by its petition, represented that the branch line, to be known as the Toronto Branch of the Canadian Pacific Railway, which it proposes to construct under its charter from a point at or near Sudbury to a point at or near Claremont, will be unusually expensive; that an issue of twenty thousand dollars of bonds per mile thereon would not constitute a sufficient aid towards the construction thereof; and that a similar state of things will probably occur in respect of other branches to be hereafter built by the said company, and it has prayed that the maximum amount of bonds to be issued on any such branch, be fixed at thirty thousand dollars per mile, and it be authorized to issue debenture stock in the place and stead of such bonds; and it is expedient to grant the prayer of the said petition.
"8. The route map of the James Bay Railway Company was duly filed and approved by the Minister of Railways and Canals pursuant to section 122 of the 'Railway Act 1903' on the 2nd day of April 1904. Plans, profiles and books of reference showing the James Bay Railway Company's location through the districts of Nipissing, Parry Sound and Muskoka and the County of York were duly submitted to and sanctioned by the Minister of Railways and Canals prior to the coming in force of the said Act and thereafter by the Board of Railway Commissioners at various dates between January 26th, 1904, and December 14th 1904, and all requirements of the several Railway Acts applicable thereto preliminary to the commencement of construction have been duly complied with.
"9. The locations of the two railways in the District of Nipissing for some distance occupy identical areas and at other places throughout the locations they overlap and cross each other. By the deviations of the Canadian Pacific Railway in question herein that company
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is seeking to occupy a line which will cross the line of the James Bay Railway Company.
"10. At the dates of the passing of the Act 44 Vict. ch. 1, the entering into the agreement and the granting of the charter referred to in the said Act, the North-West Territories were governed by the Parliament of Canada by virtue of The Imperial Act 34 & 35 Vict. ch. 28, sec. 4."
"11. On or about the 13th day of November, 1897, at the request of the then Minister of the Interior, Sir Oliver Mowat, then Minister of Justice, after hearing counsel for those interested including the Canadian Pacific Railway Company, gave a written opinion which deals with the power of the Canadian Pacific Railway Company to build branches under the statute 44 Vict. ch. 1. The following is the whole of such opinion in so far as it relates to the power of the Canadian Pacific Railway Company to build branches."
"I think, though the point is not free from difficulty, that the time for building branch lines was limited to the time mentioned in clause 4 of the contract. That clause stipulates for the completion, on or before the 1st May, 1891, of the works therein described as the east section and centre sections of the road and the 15th section of the Act provides for the company's constructing "the main line," and an existing branch described in the Act, and also other branches to be located by the company from time to time as provided by the said contract * * * 'the said main line of railways and the said branch lines of railway shall be commenced and completed as provided by the said, contract.' This language is so clear and explicit that it is out of the question to suppose it not to have been intended that there should be a limit of time as regards the branches. Not only does the Act expressly state the contrary, but to give an unlimited time for commencing
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or completing a railway authorized by any Act would have been contrary to the whole course of railway legislation. It would be contrary also to the policy of the General Railway Act of 1879 s. (6) which Act is referred to in the 22nd clause of the contract as applying to the Canadian Pacific Railway so far as applicable thereto and as not inconsistent with the Act relating to that company.
"Now it is true that the 4th section of the contract does not expressly mention branch lines. But it being quite clear from the 15th section of the Act that it was intended there should be a limit of time both for commencing and for completing these, that Parliament interpreted some provision in the contract as containing a limit or as showing a limit when read with the 15th section of the Act, and that the only provision on the subject of such a limit is the 4th clause of the contract, that clause is to be construed accordingly. The words 'the said main line of railway and the said branch lines of railway shall be commenced and completed as provided by the said contract' may be read as including in the eastern and centre sections named the branch lines which the company should build therefrom under the authority of the Act; or the 15th section may be read as if it said "provided for by the contract in respect of the works therein specified. It was evidently intended by Parliament to put the main line and the branch lines on the same footing in this respect.
"It has been suggested that the 15th section may be read as limiting time for those branch lines only which the company had contracted to build, but these are no more provided for by the words than other branch lines are; and if the 4th clause may in the light of the 15 th section be read so as to embrace the branch lines contracted for, these may be read in like manner as
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embracing the branch lines located by the company from time to time."
The date fixed by the contracts referred to in section six of the agreement in the schedule to 44 Vict. ch. 1 for the completion of the construction of the Lake Superior section, were all prior in time to the first of May, 1891.
The statement then refers, with extracts to the following statutes namely,—33 & 34 Vict. ch. 3 (D), (preamble and sec. 1); 34 & 35 Vict. ch. 28 Insp. (preamble, enacting clause and secs. 1, 3 and 4); 46 Vict. ch. 34 (D), sec. 6; and 47 Vict. ch. 1 (D.) preamble; 44 Vict. ch. 1 (D), with schedules, and "The Consolidated Railway Act, 1879" ch. 9, sec. 28, sub-sec. 6.
The principal questions referred to upon the arguments at the hearing of the case are discussed in the judgments now reported.
Ewart K.C., Aylesworth K.C. and Creelman K.C., for the Canadian Pacific Railway Company. As to the meaning of the word "territory" generally:— "From the fundamental doctrine of territorial sovereignty * * flows the corrollary that territory and jurisdiction are co-extensive;" Hannis Taylor, International Law, 206:—"The whole space over which a nation extends its government becomes the seat of its jurisdiction and is called its territory;" Vattel, Droit des Gens, I, c. 18, sec. 205; Hannis Taylor, International Law, 206:— "A dependency is a territory placed under a subordinate government;" Cornewall Lewis, Government of Dependencies, 9:—"The entire territory subject to a supreme government possessing several dependencies (that is to say, a territory formed of a dominant country together with its dependencies) is sometimes styled an Empire;" Cornewall Lewis, Government of Dependencies, 73; "The territorial
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property of a state consists of all the land and water within its geographical boundaries, including all rivers, lakes, bays, gulfs and straits lying wholly within them * * The non-territorial property of a state consists of such possessions as it may hold in its public capacity beyond its own limits;" Hannis Taylor, International Law, 263: "Territory of the state acquired by prescription;" Ib., 275: "One sovereign power is bound to respect the subjects and rights of all other sovereign powers outside of its own territory The Queen v. Jameson: "Every state possesses the power of regulating the conditions on which property within its territory may be held or transmitted Fœlix, Droit Int. Privé, sec. 9; Hannis Taylor, International Law, 206.: "The jurisdiction of the nation within its own territory is necessarily exclusive and absolute;" per Marshall, C. J. in The Schooner Exchange v. McFaddon, (1812).: "It is a principle * * universally recognized that the power of legislation in constituting offences * * is primâ facie local, limited to the territory over which the legislature has jurisdiction;" Re Criminal Code Bigamy sections (1897), at pages 469, 470, 471, 472, 476, 477, 484, 488, 489: "If the legislature of a particular country should think fit by express enactment to render foreigners subject to its laws with reference to offences committed beyond the limits of its territory;" Reg. v. Keyn,: 'Straits only, or less than, six miles wide are wholly within the territory of the state or states to which their shores belong;" Haanis Taylor. International Law, 279: "The jurisdiction of colonies is confined within their own territories, and the maxim * * * extra territorium fus dicenti impune non paretur would be applicable to such a case;" Macleod
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v. Attorney-General for New South Wales: "The laws of a colony cannot extend beyond its territorial limits;" Low v. Rutledge; Reg. v. Mount; Reg. v. Brierly: "But since states are not accustomed to permit another state to enter their territory for the sake of exacting punishment;" Grotius, Bk. II, c. 21, sees. 3, 4; Clarke, Extradition, 2: "Assassins, incendiaries and robbers are seized everywhere at the desire of the sovereign in whose territories the crime was committed;" Vattel, Bk. II, sec 76; Clarke, Extradition, 3: "He ought to be delivered up to those against whom the crime is committed, that they may punish him within their own territories;"Rutherford, Bk. II, c. 9, sec. 12; Clarke, Extradition, 8: ''There ought to be laws on both sides giving power * * * to each government to secure persons who have committed offences in the territory of one and taken refuge in the territory of the other;" Lord Brougham in the House of Lords, 14th Feb. 1842; Clarke, Extradition, 10: "The law of nations embraces no provision for the surrender of persons who are fugitives from the offended laws of one country to the territory of another;" United States v. Rauscher; Hannis Taylor, International Law, 255: "Statutes relating to the removal of persons from the territory of the law maker;" Lefroy, Legislative Power in Canada, pp. 322-338: "Territorial waters of Her Majesty's Dominions" does not mean. North-West Territory waters, in the Dominion of Canada; see 41 & 42 Vict. (Imp.), ch. 73, sec. 7; Hannis Taylor, International Law, 277: "Charles the Second made a grant to Lord Clarendon and others of the territory lying on the Atlantic ocean;" Story on the Constitution, (ed. 1891,) 93: "A project was formed for the settlement of a colony
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upon the unoccupied territory between the rivers;" Ibid, 101: "At the time of the first grants of the colonial charters, there was not any possession or occupation of the territory by any British emigrants; Ibid, 107.
The treaty between Great Britain and the United States of 9th August, 1842, is styled "A treaty to settle and define the boundaries between the territories of the United States and the posessions of Her Britannic Majesty in North America * * * and for the giving up of criminals," etc. But the word "territories" here does not apply to Oregon, but to the State of Maine principally. In the recital of the treaty are the words: "The prevention of crime within the territories of the two parties." Section 4 provides for the case of "grants of land heretofore made by either party within the limits of the territory which," etc. And section 5 provides for the "Disputed Territory Fund." So also, in the Treaty of 1846 establishing the boundary west of the Rocky Mountains, the desire is recited for "An amicable compromise of the rights mutually asserted by the two parties over the said territory. And see articles 1 and 3 of the treaty.
As to whether or not the James Bay Railway Company can raise objection as to time of construction see Roy v. La Compagnie du Chemin de Fer Quebec, Montmorency & Charlevoix, per Cassault J.; Morawetz on Corporations, secs. 1006, 1015; Re New York Elevated Railway; Thompson on Corporations, sec. 6598, 6602; Chesapeake & Ohio Canal Co. v. Baltimore & Ohio Railroad Co., per Buchanan C. J. at page 121; Becher v. Woods; McDiarmid v. Hughes; Doe d. Hayne v. Redfern; Doe d. Evans v. Evans.
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The following cases and authorities were also cited: —Am. & Eng. Encycl. vol. XCIII, p. 677; Chicago and Western Indiana Railroad Co. v. Dunbar; Rochester H. & L. Railroad Co. v. New York Lake Erie & Western Railroad Co.; Trester v. Missouri etc. Railroad Co.; New York & Erie Railroad Co, v. Young; Williamsport & N. B. Railroad Co. v. Philadelphia & Erie Railroad Co.; Major v. The Canadian Pacific Railway Co., per Ritchie C. J. at pages 237-240 and The North Eastern Railway Co. v. Lord Hastings at page 268.
S. H. Blake K. C., Walter Cassels K. C. and W. A. H. Kerr for the James Bay Railway Co. In order to arrive at the rights of the Canadian Pacific Railway Co. in view of the legislation which has been enacted, it becomes essential to consider what rights were granted to the contractors by section 14 of Vict., ch. 1. The company stand in the place of the contractors, they are the contractors, and their right to construct branch lines is a right given them "from time to time." It must be limited to the time within which their contract had to be performed. No right could exist after they had received the consideration for the fulfilment of their contract, within the time limited, after the expiration of their contract and after the time had expired.
No such right can be inferred from the provisions of section 15 of the charter. The opinion of Sir Oliver Mowat, on this question, is obviously correct and we refer to it as part of our argument). It is obvious that if the general powers to build branches, as claimed, existed there could be no necessity for the
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specific powers given as to building branches mentioned in clause 15 of the charter.
It was never contemplated or intended that the Dominion should infringe the rights of the provinces to incorporate railways having their terminal points within the provincial boundaries, in virtue of the British North America Acts, 1867 and 1871. At the time of the contract the powers subsequently taken by the Dominion, by 46 Vict, ch. 24, sec. 6, as to legislation in regard to railways intersecting or crossing railways chartered by the Dominion, did not exist nor was any such right then claimed by the Dominion. The "territory" within which the Tights were granted respecting branch lines was, obviously, only that territory over which the Dominion had sole jurisdiction under the British North America Act, 1871. It is impossible to place any construction upon clause 14 of the contract which might extend its meaning so as to include other parts of Canada.
The only other clause which can be relied upon by the company as giving them the powers claimed as to the construction of branch lines is clause 15 of the charter, and this still leaves them subject to the condition that any branches or branch lines, including those specifically named, must be completed within the time limited for the construction of the main line according to the contract. If there was such power conferred as is now claimed by the company as to the construction of branch lines, then there would have been no necessity of giving specific powers as to the branches particularly mentioned. These particular branches were named and power given to construct them for the reason that they would not be covered by section 14 of the contract, their terminal point not being within the territory of the Dominion.
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It is obvious that, when the contract was entered into, the contractors were to have the right to layout and equip, etc., branch lines to any point or points within the territory of the Dominion, what was meant by the word "territory" was what was known by the British North America Act of 1871, as the territory of the Dominion. It would seem an absurd contention that these words should be construed as meaning any point or points within the Dominion of Canada.
The contractors were constructing two sections; quû contractors they would have the right to build branch lines. The Government were constructing the other sections of the railway, and the words "to any point or points within the territory of the Dominion" cannot be held to mean more than they say, and have reference only to as the territory over which the Dominion had exclusive legislative jurisdiction, and in which the Dominion owned the Crown lands. This is manifest from the provision of the clause 14, providing that the Government shall grant to the company the lands required for the roadbed of such branches, for the stations, etc., in so far as such lands are vested in the Government. How can it reasonably be contended, having regard to this language, that a general power to construct east from Winnipeg to the Atlantic Ocean, or west from Winnipeg to the Pacific Ocean, could be conferred upon these contractors?
We also submit that if, in point of fact, any particular branches have been sanctioned by the Parliament of Canada, although we do not admit that any have been so sanctioned, such a thing as estoppel could only be set up in regard to the particular branches so sanctioned. There is no ambiguity whatever as to the meaning of the statute, 44 Vict., ch. 1. There is no power in the Government to vary or alter the
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terms of the contract and such a thing as an estoppel against the Crown and the public of Canada, by an acceptance of certain lines constructed even if beyond the powers of the company, could have no possible effect in enlarging the powers conferred by the statute and contract hereinbefore set out.
As to our rights of contestation, we do not require to bring in the Attorney General for Ontario; we can sustain our position alone as our lands and rights are imperilled. Grahame v. Swan, at page 559. As to the interpretation of the words "time to time" see 26 Am. & Eng. Encycl (2 ed.), and at page 167 as to stare decisis being a wider term than res judicata. This is not a case for scire facias, there is no question of a forfeiture of any kind.
New combe K.C., Deputy of the Minister of Justice, and A. S. White K.C. held a watching brief on behalf of the Attorney General for Canada.
Formal answers were rendered by the Supreme Court of Canada, as follows:—
"In the matter of application No. 590 of the Canadian Pacific Railway Company for approval of certain deviations from the original plan of the route of the Sudbury Branch of their railway, referred by the Board of Railway Commissioners for Canada for the opinion of the Supreme Court of Canada, under the statute of Edward VII., chapter 58, section 45, being 'The Railway Act, 1903,' the following questions were submitted to the court for hearing and consideration:
"I. Has the Canadian Pacific Railway Company, under the legislation, schedule and charter aforesaid, now power to construct the branch line referred to, or has the time expired within which such branch line might be constructed?
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"II. Do such legislation, schedule and charter authorize construction by the said company of the proposed branch line, it being altogether situated in the Province of Ontario?
"III. Is it open to the James Bay Railway Company or to the Board of Railway Commissioners to take the objection that the time within which the said company may build branch lines under its charter has expired?
"The court, having heard counsel on behalf of the Canadian Pacific Railway Company, as well as on behalf of the James Bay Railway Company (the Attorney General for Canada also represented by counsel who stated that he was taking no part in the argument), and having considered the questions submitted as aforesaid, certifies to the said Board of Railway Commissioners for Canada that, for the reasons contained in the documents hereunto annexed, the following are the answers of the said court:
"To the first question;—Yes, the Canadian Pacific Railway Company has now power to construct the said Sudbury branch of its railway, Idington J dissenting.
"To the second question;—Yes, Idington J. dissenting, on ground of time having expired.
"To the third question;—Yes, as to both the James Bay Railway Company and the Board of Railway Commissioners; Girouard and Davies JJ. taking no part in this answer, because the answers to the first and second questions render any answer to the third question unnecessary."
(Signed) "Robt. Sedgewick J."
"D. Girouard J."
"L. H. Davies J.
"Wallace Nesbitt J."
"John Idington J."
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Reasons for foregoing answers were delivered by Their Lordships, annexed to the formal opinion, as follows:—
Sedgewick J.—This is a reference to this court from the Board of Railway Commissioners for Canada by virtue of the Dominion Railway Act, 1903 Some years ago the Canadian Pacific Railway Co. had located a branch line from Sudbury in the Province of Ontario to Toronto, and had obtained, before the passing of the Railway Act of 1893, the approval of the Minister of Railways to the location and plans thereof. Subsequently, after the passing of that Act, the Canadian Pacific Railway Co. applied to the Board for approval of certain deviations from the proposed route of this Sudbury branch. The James Bay Railway Co. opposed the application on the ground that the Canadian Pacific Railway Co had no authority to construct the branch cither under its original charter or by any subsequent legislation. These are the questions:
1. Has the Canadian Pacific Railway Company, under the legislation, schedules and charter aforesaid now power to construct the branch line referred to; or has the time expired within which such branch line might be constructed?
2. Do such legislation, schedules and charter authorize construction by the said Company of the proposed branch line, it being altogether situated in the Province of Ontario?
3. Is it open to the James Bay Railway Company, or to the Board of Railway Commissioners, to take the objection that the time within which the said Company may build branch lines under its charter has expired?
Section 15 of the Canadian Pacific Railway Go's charter is as follows:
15. The Company may lay out, construct, acquire, equip, maintain and work a continuous line of railway, of the gauge of four feet eight and one-half inches, which railway shall extend from the terminus of the Canada Central Railway near Lake Nipissing, known as Callander Station, to Port Moody in the Province of British Columbia; and also, a branch line of railway from some point on the main line of railway to Fort William
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on Thunder Bay; and also the existing branch line of railway from Selkirk, in the Province of Manitoba, to Pembina in the said Province; and also other branches to be located by the Company from time to time as provided by the said contract,—the said branches to be of the gauge aforesaid; and the said main line of railway, and the said branch lines of railway, shall be commenced and completed as provided by the said contract; and together with such other branch lines as shall be hereafter constructed by the said company, and any extension of the said main line of railway that shall hereafter be constructed or acquired by the company, shall constitute the line of railway hereinafter called The Canadian Pacific Railway.
This section contemplates two classes of branch lines, namely, branches such as that from Selkirk to Pembina, and another from a point on the main line of railway to Fort William. These two branches may be called the Government branches to distinguish them from the other branches to be located by the company from time to time, which may be called the company branches.
I take the meaning of this clause to be that the company might "acquire" (it certainly was not intended that they should "lay out" or "construct") the two sections of the main line which the Government were to build and those Government branches which were either in process or in contemplation of being built; and that they might "construct" the other two sections of the main line and other branches "to be located by the company from time to time."
The first question then is: Has the time expired for the construction of branch lines? The controlling word is in clause 15 above set out, wherein it is provided that the company may construct other branches to be located by the company from time to time, and that the whole, namely, the said main line of railway and the said branch lines of railway (Government branch lines and company branch lines) shall be commenced and completed as provided by the said contract. There is a time specified when the main line is to be
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commenced and also when it is to be completed, but there is no provision in the contract which can with any certainty lead to the conclusion that any time was ever fixed for the commencement or completion of the company's branch lines. The contestants, the James Bay Railway Co., seek to eliminate the words "shall be commenced and completed as provided by the said contract," and to insert in lieu thereof words which may have, and which I think have as a matter of fact, a different meaning: They propose to read the provision that branch lines must be commenced and completed as provided by the said contract, as if it said that branch lines "shall be commenced and completed within the same time as is provided by the contract for the commencement and completion of the two sections of the main line by the company." I have not sufficient boldness to venture upon such judicial legislation as this. Judicial legislation may be necessary where we have to delve into the common law to obtain some precedent for a state of affairs involving legal rights the like of which is new in the experience of mankind, but I have never yet been able to see any necessity for a resort to that method when we are endeavouring to interpret a written instrument, whether it be a statute, a contract, or any other document. No matter what the intention may have been, unless that intention can be unequivocally drawn from the language which the parties have used in the instrument under consideration, it is all the same as if there had been no intention at all.
The contestants contend that the contract must be construed so as to make the commencement of the branch lines co-incident with those of the two sections of the main line, but one section of the main line is to be commenced by the "first July next" and the other not later than the "first May
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next." Which of these dates applies to branch lines?
Several considerations in addition to those arising from a study of the mere words themselves will, I think, lead to the conclusion that it could not have been the intention of Parliament to provide a definite period beyond which the company would lose their power of building branch lines.
Consider the condition of the North West Territories at the time this contract was made. A vast, practically unknown country, the fertile belt of which was in round numbers nearly 1000 miles in length, and nearly 500 miles in width. It was practically unsurveyed. The road was intended to be not only a great international highway extending from the Atlantic to the Pacific, but a great colonization railway as well, its main object being to open up to the world that magnificent area of wheat growing country, the wealth and potentialities of which we have even yet hardly begun to appreciate.
The Government had entered into an obligation with British Columbia pursuant to the "Carnarvon Terms" to complete the road at the earliest possible moment, and the whole power of Parliament, practically the whole revenues of the country, and every energy the Canadian people possessed, were cheerfully given to attain the end in view, the national honour of Canada being to a certain extent involved. The first great aim of the government, of Parliament and of the company must therefore have been to finish the main line first; branch lines to be built by the company might well afford to wait. They could not be built anyway for any practical purpose, particularly through the fertile belt so called, without previous survey and considerable settlement. What concession would it have been to give the company the right to build branch lines only during the ten years
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during which the main line was being built? They could not touch branch lines. It would be an illusory gift at the best. It has been suggested to us that the power contended for by the Canadian Pacific Railway Co. that, they have the right in perpetui y to build branch lines from their main line was such a tremendous power, a power so fraught with danger to the state and the exercise of which might prevent the building of other railways by competing companies, that any construction other than that must be resorted to. I have yet to see anything very extraordinary in the grant of this power, especially when we consider the other grants which Parliament in its wisdom was induced to make for the purpose of completing the railway and of thus cementing together the theretofore scattered fragments, the disjecta membra of the Dominion.
Parliament had contributed $25,000,000 in cash and 25 million acres of land. It had given gratuitously to the company the two main sections ready to be operated, at a cost I suppose as great as that of the sections built by the company. It had made them a perpetual corporation, and eliminated from the general Act section after section which might be supposed to interfere more or less with the carrying on of the enterprise and with the borrowing of money for that purpose. It had also, (and this may be deemed to be an extraordinary concession, necessary doubtless in the interests of the enterprise, but still extraordinary,) enacted that the Canadian Pacific Railway, and all stations, station grounds, work shops, buildings, yards and other property, rolling stock and appurtenances required and used for the construction and working thereof, and the capital stock of the company, should be forever free from taxation by the Dominion or by any province thereof to be established or by any municipal corporation therein, and it had as well
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exempted the company's lands from taxation for twenty years after the grant thereof from the Crown. Thus Parliament had given the company chartered powers to last forever. It had given them the right to operate forever a line of railway from the Atlantic to the Pacific, assuming the company took advantage as it has since done of this special provision in the charter for the acquirement of railways east of Sudbury. It had exempted the company's property, so far as it was within the North-West Territories and was used for railway purposes, from taxation forever. Why should it be thought a strange thing, an abnormal thing, a thing so unthinkable that the words of the contract must be twisted out of shape to obviate the difficulty— why should it be thought a strange thing that Parliament should give to the company along with these other perpetual rights, the perpetual right of building branch lines from any part of its main line to any other point within Canadian territory? The whole state of affairs at the time of the charter must have indicated that for many years, perhaps for generations, the Canadian Pacific Railway could be successfully operated only by the opening up of the North-West for settlement and by the building of branch lines by this parent road for the purpose of making the most of the country and developing its innumerable magnificent resources. One can easily imagine that it would have brought a smile to the cheek of those illustrious gentlemen whose daring and patriotism, and whose pluck and fortitude (along with that of others,) accomplished the work, had some law officer of the Crown in treaty with them suggested "Oh, but if you want to build any branch lines you must begin and complete them at the same time as you begin and complete the main line." Short work,
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one can readily conceive, would be made of such a proposition as that.
I take the liberty of adding here an epitome of the Canadian Pacific Railway Company's argument on this branch of the case, as set out in their factum:
1. The contract does not fix any date for completion of branch lines.
2. The dates fixed for the commencement and completion of the main line cannot apply to the company's branches;
(a.) Because there are several such dates, and there is no reason for selecting one rather than the other.
(b.) Because the short periods for the commencement of the main line would be absurdly inadequate for the location of the necessary branches.
(c.) And still more inadequate for the comencement of construction.
(d.) Because the speedy construction of the main line was the paramount object of the contract.
(e.) Because the main line itself (from which branches were to be built) was not itself fixed by the contract and was not definitely settled until the year 1882 or afterwards.
(f.) Because the clause itself speaks of "other branch lines" to be "hereafter constructed by the said company."
I am now come to the second question: Has the Canadian Pacific Railway Company power to build branches in Ontario? The contestants say— "No. That they cannot build branches except to a point within what is known as the North-West Territories," basing their argument upon section 14 of the contract which provides that:
The company shall have the right from time to time to lay out, construct, equip and maintain and work branch lines of railway from any point or points along their main line of railway, to any point or points within the territory of the Dominion.
They argued that the word "territory" there must mean immovable property owned by the Dominion. This argument appears to me to be so, shall I venture to say, far-fetched, that the very statement of it is its own contradiction.
They also argue that "territory of the Dominion" means "The North-West Territories."
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A third argument is that the Canadian Pacific Railway Company is empowered to build branches from the eastern and central sections only. To my mind nothing can be more unlikely or inconceivable than this. Even admitting the contention, nothing can be derived from it, for the branch which is under consideration is admitted to commence at a point upon the eastern section.
I simply propose to assert that the territory of the Dominion has no connection whatever with the phrase "The North-West Territories of Canada," except in so far as the North-West Territories are part of that territory. The territory of the Dominion, I take it, is all those lands and lands covered with water which form part of or are under the Parliamentary control of the Dominion. The phrase has no reference whatever to the dominium or ownership of the Crown, but to those British Dominions beyond the seas, known under the constitutional Act by the name of Canada. The point, however, seems to me so insignificant that the elaborate argument given by counsel for the Canadian Pacific Railway Company is all that need be referred to.
As to the third question I concur in the judgment of my brother Nesbitt.
GiROUARD J.—This reference—the first from the Board of Railway Commissioners for Canada—involves very important questions of construction of the powers of the Canadian Pacific Railway Co., to construct branch lines. It has been said that franchises of this character are to be construed most strictly against the corporation and in favour of the public; but it is now well settled both in England and the United States that the powers may be implied as well as expressed, and that their construction must be reasonable, that is,
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consistent with and following a reasonable view of the general scope and purpose of the legislative grant, viewed in the light of surrounding circumstances. Attorney General v. Great Eastern Railway Co.; The Government of Newfoundland v. Newfoundland Railway Co.; Jacksonville Railway Company v. Hooper. It will not, therefore, be out of place at the outset to give a short history of the Canadian Pacific Railway and inquire into the circumstances which gave rise to the construction and operation of this transcontinental line.
The Canadian Pacific Railway does not owe its existence to the ambition of individual adventurers, but to the national policy of Canada, as expressed in several Acts of its Parliament. The very preamble of the Act we are now requested to consider, 44 Vict. ch. 1, declares that by the terms and conditions of the admission of British Columbia into the Dominion of Canada
the Government of Canada has assumed the obligation of causing a railway to be constructed, connecting the seaboard of British Columbia with the Railway system of Canada.
The immense western country known as Rupert's Land, which had recently been acquired from the Hudson Bay Company, had not been surveyed; it was very little known and, as stated in the printed case, "was almost completely uninhabited.". The Canadian Government, however, was so satisfied that the obligation assumed in favour of British Columbia would easily be accomplished, that it agreed to do so within ten years from the date of the union, that is in 1881.
The stated case, settled by the Board of Railway Commissioners and agreed to by the parties, refers us to many statutes and other public documents. I think
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that in a case of public interest, I may say of Government or parliamentary contract or agreement like the present one, we ought to carefully consider not only the parts of the documents quoted, but also the whole, and in fact all the public documentary records which may affect the case, and which, under the Evidence Act of 1893, courts of justice can take official notice of without causing any surprise or injury to any party. In many past cases of this description this court and the Privy Council have even referred to opinions expressed in Parliament as reported in Hansard.
In 1872 the Parliament of Canada passed the first Canadian Pacific Railway Act and granted a subsidy of 50 million acres of land, and 30 million in cash; 35 Vict. ch. 71. Although two companies were incorporated to carry out the scheme, and one of them was accepted and obtained the contract, nothing came out of this first effort. In 1874 another offer was made, which will be found in 37 Vict. ch. 14. Briefly stated, it provided for a subsidy of 20,000 acres of land, and $10,000 cash per mile, and a Government guarantee of 4 per cent for twenty-five years upon such sum as might be necessary to secure the construction of the road. There was no provision for any branch line except the Georgian Bay and the Pembina branches, which were also generously subsidized. The second scheme also failed, and to keep faith with British Columbia an extension of time had to be demanded and the Government set to work by commencing to build two of the heaviest sections of the entire line, extending over about 644 miles of a mountainous country, namely, the Lake Superior section, from the head of Lake Superior near Fort William to Selkirk, and the western section from Kamloops to Port Moody. While these extensive works were in progress under Government contracts a new project was proposed, and
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approved of by Parliament, the meaning of which we are called upon to determine, as to branches to be constructed. This statute is 44 Vict. ch. 1, and was passed in 1881, although the contract which led to it was signed in October, 1880. The Government undertook to finish and deliver to the company the two sections commenced, and the company promised to build the eastern section from Callander Station to the Lake Superior section, and also the central section from Selkirk to Kamloops, on or before the first day of May, 1891, the company receiving a cash subsidy of 25 millions of dollars and a land subsidy of 25 millions of acres, valued at that time at about $1.50 per acre. This statute is composed of three parts. 1st. "An Act respecting the Canadian Pacific Railway;" 2nd. The said contract; and, 3rd. the charter or Act of incorporation. I presume the three documents must be read together, but if there is any discrepancy between them the contract must give way. I believe there is none, at least as to the point before us.
As it may easily be understood from the past experience most extensive and, in fact, unprecedented powers were demanded and obtained. To do so the whole policy of the country, as expressed in the Railway Act of 1879, had to be set aside and a new and exceptional one adopted. More liberal subsidies and concessions had to be granted. The two Government sections, which were estimated to cost about $28,000,000, but did actually cost a little over $31,000,000, were to be delivered free of charge. The lands required for the Toad bed, for stations, station grounds, workshops, dock ground and water frontage at the termini on navigable waters, buildings, yards, if vested in the Government, were granted to the company. It was also agreed that all this property and the railway, its rolling stock and the capital stock of the company were
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to be forever free from taxation by the Dominion or the Territories, or any province or any municipal corporation to be established therein, and that the land grants were also to be free from taxation for 20 years from the date of the Crown patent, unless sooner sold or occupied. The selection of these lands was entirely left with the company instead of the Government. The importation of the rails and all railway and telegraph material to be used in the original construction was declared to be free from customs duty. The company might at any time, whether within ten years or after, operate lines of steamers over seas, lakes and rivers, which it might reach or connect with, although in doing so it might damage or even destroy similar lines already existing. Finally, to come to the matter which is the subject of this reference, unlimited powers to build branch lines were given to the railway company by merely depositing the plan of location, without the sanction of the Governor in Council.
Notwithstanding these extraordinary concessions and privileges, the company soon almost came to grief, and in 1884 had to come to Parliament for relief. It was granted in the form of a temporary loan for nearly $30,000,000, which was satisfied and settled a few years afterwards, and before maturity, partly in cash or its equivalent, and partly by selling to the Government 6,793,014 acres of its land grants at $1.50 an acre. (47 Vict. ch. 1., 49 Vict. ch. 9.) Ever since the company's success has been constant and on the increase, so much so that it has added 4,785 miles of extensions and branches to its original main line, and has finally become one of the greatest railway corporations in the world, with a paid-up capital of $407,000,000, and nearly $133,000,000 of bonded debt, according to the blue books published by the Government, from which and the Acts of Parliament all the above figures have been collected.
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Now railway charter holders who are always to be found in every progressive and prosperous country, are quarrelling with it over the power, which it has at all times exercised, of building branch lines any where within the Dominion under their charter and without a special Act of Parliament.
At the argument I was very much impressed with the magnitude of the powers claimed by the Canadian Pacific Railway Co., as it would strike the mind under existing circumstances, but viewed in the light of the above circumstances it is not extraordinary. Parliament and the country, it seems to me — for its action was sanctioned by the people the following year — were prepared to grant almost anything to meet its obligation to British Columbia. But let us go now to the pure legal aspect of the case.
The charter, clause 15, enacts:
The company may lay out, construct, acquire, equip, maintain and work a continuous line of railway, of the gauge of four feet eight and one-half inches, which railway shall extend from the terminus of the Canada Central Railway, near Lake Nipissing, known as Callander Station, to Port Moody, in the Province of British Columbia; and also a branch line of railway from some point on the mainline of railway to Fort William, on Thunder Bay; and also the existing branch line of railway from Selkirk, in the Province of Manitoba, to Pembina, in the said province; and also other branches to be located by the company from time to time, as provided by the said contract – the said branches to be of the gauge aforesaid; and the said, main line of railway, and the said branch lines, shall be commenced and completed as provided by the said contract; and, together with such other branch lines as shall be hereafter constructed by the said company, and any extension of the said main line of railway that shall hereafter be constructed or acquired by the company, shall constitute the line of railway hereinafter called the Canadian Pacific Railway.
Clause 18 of the charter, para, (d), enacts that
the map or plan or book of reference of any part of the main line of the Canadian Pacific Railway made and deposited in accordance with this section, after approval by the Governor in Council, and of any branch of such railway hereafter to be located by the said company, in respect of which the approval of the Governor shall not be necessary, shall avail, etc.
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Clause 31 of the charter also provides for the issue of bonds in place of land grant bonds
on the main line of the Canadian Pacific Railway and the branches thereof hereinbefore described, but exclusive of such other branches thereof, etc.
Clause 14 of the contract reads as follows —
14. The company shall have the right, from time to time, to lay out, construct, equip, maintain and work branch lines of railway from any point or points along their main line of railway to any point or points within the tevritory of the Dominion. Provided always, that before commencing any branch, they shall first deposit a map and plan of such branch in the Department of Railways. And the Government shall grant to the company the lands required for the road bed of such branches, and for the stations, station grounds, buildings, workshops, yards and other appurtenances requisite for the efficient construction and working of such branches, in so far as such lands are vested in the Government.
I was first inclined to think that the power to build the branch lines was limited to the North-West Territories, which were the property of the Dominion. After carefully examining all the clauses of the contract I soon became convinced that the word "territory" (without a capital T) in section 14 must be taken in, its ordinary sense, that is, jurisdiction. Whenever Parliament intends to use it as indicating the country known as the "Territories," it generally uses that expression, or sometimes that of "Territory," as in section 9 of the charter and the preamble of the Act, or more often that of "North-West Territories," as in sections, 11, 14, 15 and 16 of the contract. Such is, moreover, the name which Parliament had previously given to that country. 32 & 33 Vict. ch. 3, s. 1.
Likewise, as to time, I fail to find any limitation. It is contended that branch lines, like the main line, must "be commenced and completed as provided by the said contract." But the contract does not impose any limitation as to the commencement or completion of their location or construction; it has a limitation in clause 4 as to the main line only and also "the said
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branch lines of railway" contracted for, namely, the Fort William branch—which was never built in consequence of a deviation of the main line — and the Pembina branch, which, although finished, had to be maintained and worked. As to the other branches to be located, which the company may or may not immediately construct, the charter, section 15, and the contract, clause 14, both provide that they may be constructed from time to time, that is, at any time the company deems it expedient. This is the only reasonable construction which can be placed upon these enactments. It is, in fact, necessary to the working out of the land grant arrangement.
It is stipulated in the contract, section 11, that these land grants are to extend back 24 miles deep on each side of the main railway from Winnipeg to Jasper House; but if they are not fit for settlement the deficiency is to be made up in the fertile belt or elsewhere "at the option of the company * * * extending back 24 miles deep on each side of any branch line or lines of railway to be located by the company." It would take years, certainly more than ten years, before the company might be called upon to make this option and select its land grants; in fact the parties have admitted in the stated case that it was not till 1901 that the last townships through which the mainline of the railway runs were surveyed and set off into sections. They also admit that large tracts of land through which branch lines of the company may run under the charter have not yet been surveyed into townships by the Government. There is no limitation of time as to the option or selection; it could not be commenced before some years, and certainly could not be completed before the necessary surveys were made; parties agree that it cannot be completed even at the present time. How can it be contended that the company could possibly
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locate or build branch lines necessary to the development of these lands before they are selected and probably patented by the Crown?
Clause 6 of the contract provides for the completion and delivery of the Government sections partly by the 30th of June, 1885, and the whole at the latest by the 1st of May, 1891. I cannot understand how the company could possibly complete all its branch lines from these sections before the latter date, for, as I understand clause 7 of the contract and clause 15 of the charter, these sections form part of the Canadian Pacific Railway from which the company can construct branch lines as well as from the sections constructed by the company. As a matter of fact only seven branches were built prior to the 1st of May, 1891, in order to give railway facilities to distant settlements or to industrial establishments in close proximity, whereas nineteen have been built since that date. In all cases of railway development, especially in an immense and wild country like that traversed by the Canadian Pacific Railway, almost entirely uninhabited on its entire length of about 2,644 miles west of Callander Station, near Sudbury of to-day, the necessity of branch lines is not generally felt till the main line is built and operated, and for many years afterwards.
If any doubt be possible upon the point, which I do not, however, entertain, courts of justice should hesitate before denying a power which has often been recognized by the highest authorities. We have no expression of judicial opinion exactly in point except as to location, but we find, in the case of the Canadian Pacific Railway Co. v. Major decided by this court in 1886, and reported in 13 Can. S. C. R., at page 237, dicta and propositions as to time, which seem to sustain the contention of the company in the present instance.
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Chief Justice Ritchie, referring to a certain limitation enacted by the Railway Act of 1879, and to section 14 of the contract, said, speaking for the court:—
From which (section 14) it is abundantly clear that the right conferred on the railway company from time to time to lay out, construct, equip, maintain and work branch lines of railway from any point or points along their main line of railway to any point or points within the territory of the Dominion is entirely inconsistent with any such limitation; and therefore I think the company had a right to construct a branch from any point or points on the railway to English Bay as well as to any other point or points within the territory of the Dominion.
And further on the learned judge adds (at page 240):—
No court has a right to reject, or refuse to give effect to, the words of the legislature if a reasonable construction can be placed on the language used, and, therefore, I am constrained so to construe this statute as to give effect, if possible, to this, to my mind, very plain language of the legislature, and I can give no effect to it if it was not the intention of the legislature to authorize such branches and such extensions of the main line as might be found expedient to complete and make available this great national undertaking, the construction of a railway connecting the sea-board of British Columbia with the railway system of Canada, a construction not only reasonable but one which, in my opinion, harmonizes with the subject of the enactment and the object which the legislature had in view.
When the contract was under discussion in the House of Commons Mr. Blake, the leader of the Opposition, demanded its rejection upon the ground, among others, that
by the contract, power is given to the company forever to build branch lines in various parts of the Dominion. (See Votes and Proceedings, (1881) p. 159).
From the time of its approval by Parliament to the 1st of May, 1891, no less than seven branch lines were constructed within the limits of the old provinces, and after that date to the year 1903 eighteen more were built and operated within the old provinces, two of them extending through the Territories and only one being entirely in the latter country, the
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whole without any objection being raised by any one, and in almost every case, after due Dominion inspection and authorization.
In 1884 Parliament expressly recognized the Algoma branch, then in course of construction from Sudbury to Sault Ste. Marie, in the province of Ontario, under the general powers of the charter and authorized a large issue of bonds (47 Vict. ch. 1). Parliament has also granted cash and land subsidies to branch lines of the company constructed before and since 1891. A full list of all these branch lines is given in the stated case, and it is not necessary to repeat it here. I will, however, reproduce the preamble of a Canadian statute passed in 1888, 51 Vict. ch. 51, which is the Act increasing the company's bonding power on branch lines generally, and one of the Sudbury branches in particular, from $20,000 to $30,000 per mile, as expressing the views of Parliament both upon the location and time of their construction:
Whereas, the Canadian Pacific Railway Company has, by its petition, represented that the branch line, to be known as the Toronto branch of the Canadian Pacific Railway, which it proposes to construct under its charter from a point at or near Sudbury to a point at or near Claremont, will be unusually expensive; that an issue of twenty thousand dollars of bonds per mile thereon would not constitute a sufficient aid towards the construction thereof; and that a similar state of things will probably occur in respect of other branches to be hereafter built by the said company, and it has prayed that the maximum amount of bonds to be issued on any such branch be fixed at thirty thousand dollars per mile, and that it be authorized to issue debenture stock in the place and stead of such bonds; and it is expedient to grant the prayer of the said petition, etc.
It may be said that implied recognition of power by the legislature is not sufficient to confer that power, although very high American authorities can be quoted to the contrary, which will be found collected in American and English Encyclopcedia, (2 ed.) vol. 7, p. 708; I refer especially to the case of Society vs Pawlet,
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decided by the United States Supreme Court. But it cannot, I submit, be seriously contended that the subsequent action of Parliament is not sufficient to remove any possible doubt in the matter. And finally, when we consider the disastrous consequences which a decision adverse to the Canadian Pacific Railway Company would bring upon its millions of bonds and debenture stock distributed all over the world, which would not be binding upon the so-called branch lines, I think we should come to the conclusion that it has at least that effect, unless forced to do otherwise by clear terms of the statute. For the reasons already advanced I think the statute supports this conclusion. Without wishing to add anything to the judgment of the House of Lords in Attorney-General vs. Great Eastern Railway Co. which I believe fully covers the case, I would be inclined, under the special circumstances of the case, to treat the charter of the Canadian Pacific Railway Company in a liberal manner, like any other statute, in accordance with the principle laid down in the Interpretation Act, namely, that every Act of Parliament must receive such fair, large and liberal construction and interpretation as will best insure the attainment of the object of the Act, and of every provision or enactment thereof according to its true intent, meaning, and spirit; 31 Vict. ch. 1, s. 1, par. 39; R. S. C., ch. 1, s. 7, par. 56.
With these explanations, I shall now proceed to answer the questions submitted:
To the first question I answer;—Yes, the Canadian Pacific Railway Company has now power to construct the branch line referred to, as under section 14 of the contract and section 15 of the charter it may construct any branch line at any time.
To the second question, answer;—Yes.
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To the third question:—In consequence of the above answers the answer to this question is unnecessary.
Davies J—After the fullest consideration and repeated conferences with my colleagues. I have reached the conclusion that the first two questions should be answered in the affirmative These answers render it unnecessary to give any answer to the third question, and I express no opinion with regard to it.
I have read with great care the opinion prepared by Mr. Justice Nesbitt and, as I find myself in full accord alike with his reasoning and his conclusions with respect to these two main questions, I will content myself with concurring with his judgment so far as it relates to these two questions and their answers.
Nesbitt J.—This is a case submitted by the Board of Railway Commissioners for Canada under the 43rd section of the Railway Act, 1903. The following are the questions submitted:
1. Has the Canadian Pacific Railway Company, under the legislation, schedule and charter aforesaid, now power to construct the branch line referred to, or has the time expired within which such branch line might be constructed?
2. Do such legislation, schedule and charter authorize construction by the said company of the proposed branch line, it being altogether situated in the Province of Ontario?
3. Is it open to the James Bay Railway Company or to the Board of Railway Commissioners to take the objection that the time within which the said company may build branch lines under its charter has expired?
In the year 1874 an Act was passed, chapter 14 of 37 Victoria, intituled: "An Act to provide for the construction of the Canadian Pacific Railway." This Act recites the admission of British Columbia into the union with the Dominion of Canada. It recites the fact that by the terms of the admission the Government of the Dominion were io construct a railway
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from the Pacific to connect the seaboard of British Columbia with the railway system of Canada. It then provided that a railway to be called the Canadian Pacific Railway should be made from some point near to and south of Lake Nipissing to some point in British Columbia on the Pacific Ocean. It provided for the division of the said railway into four sections. It also provided for certain branches of the railway to be constructed, such branches to form part of the Canadian Pacific Railway. Section 8 of the said statute provided for the construction of the said railway in subsections by contractors, and, after providing for the construction and the consideration to be paid therefor, subsection 10 of the said section 8 provided that in applying the said Railway Act to the Canadian Pacific Railway or any portion thereof the expression '''the railway" shall be construed as meaning any section or subsection of the said railway the construction of which has been undertaken by any contractors, and the expression "the company" shall mean the contractors for the same. The said statute sets out further provisions for the construction of the railway.
Subsequent to this statute the Act in question (and upon which mainly this case turns) being chapter 1 of 44 Victoria, assented to on the 15th of February, 1881, was enacted. It recites that by the terms and conditions of the admission of British Columbia into union with the Dominion of Canada the Government of the Dominion has assumed the obligation of causing a railway to be constructed connecting the seaboard of British Columbia with the railway system of Canada. It also recites:
That whereas certain sections of the said railway have been constructed by the Government and others are in course of construction, but the greater portion of the main line thereof has not yet been commenced or placed under contract, and it is necessary for the development of the North-West Territory and for the preservation of the good faith of the
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Government in the performance of its obligations, that immediate steps should be taken to complete and operate the whole of the said railway.
It then recites:
And whereas in conformity with the express desire of Parliament a contract has been entered into for the construction of the said portion of the main line of the said railway and for the permanent working of the whole line thereof, which contract with the schedule annexed has been laid before Parliament for its approval, and a copy thereof is appended hereto, and it is expedient to approve and ratify the said contract and to make provision for the carrying out of the same.
The statute then enacts under section 1 as follows:
The said contract, a copy of which with schedule annexed is appended hereto, is hereby approved and ratified, and the Government is hereby authorized to perform and carry out the conditions thereof, according to their purport.
The second section of the said statute provides that
for the purpose of incorporating the persons mentioned in the said contract and those who shall be associated with them in the undertaking, and of granting to them the powers necessary to enable them to carry out the said contract according to the terms thereof, the Government may grant to them, in conformity with the said contract, under the corporate name of the Canadian Pacific Railway Company, a charter conferring upon them the franchises, privileges and powers embodied in the schedule to the said contract and to this Act appended, and such charter being published in the Canada Gazette with an Order in Council relating to it shall have force and effect as if it were an Act of the Parliament of Canada.
The contract by its first clause inter alia provided:
The individual parties hereto are hereinafter described as the company.
I read this clause as a conveyancing description applicable to the contractors until after the necessary steps were taken by them to complete the incorporation authorized by the charter when the rights, franchises and privileges conferred by the contract on the incorporators became vested in the "corporate entity" to be known as the Canadian Pacific Railway Company. This was complete as I understand after the 9th April, 1881. See Gazette of that date.
The 13th clause provided that the company should have the right to lay out and locate the line of railway
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contracted for preserving the terminal points from Callander Station to the point of junction with the Lake Superior section and from Kamloops and from Selkirk to the junction with the western section. The work was divided into four sections and two branches, and the company were to build the central and Eastern sections which were to be commenced respectively by the 1st May and the 1st July, 1881, and to be completed by the 1st May, 1891. See fourth clause of contract. The Government, by the sixth clause of contract, were to complete the Western and Lake Superior sections by the latest by May, 1891. There were also two branch lines, one from Selkirk to Pembina and one from some point on main line to Fort William. These the Government were to construct the Fort William branch as part of the Lake Superior section, as a reference to the first clause of the contract and the map on page 16 of case will shew.
By the 14th clause of the contract it was provided:
The company shall have the right, from time to time, to lay out, construct, equip, maintain and work branch lines of railway from any point or points along their main line of railway, to any point or points within the territory of the Dominion. Provided always, that before commencing any branch they shall first deposit a map and plan of such branch in the Department of Railways. And the Government shall grant to the company the lands required for the road bed of such branches and for the stations, station grounds, buildings, workshops, yards and other appurtenances requisite for the efficient construction and working of such branches, in so far as such lands are vested in the Government.
And by the 15th clause of the charter it was provided:
The company may lay out, construct, acquire, equip, maintain and work a continuous line of railway, of the gauge of four feet eight and one half inches; which railway shall extend from the terminus; of the Canada Central Railway near lake Nipissing, known as Callander Station, to Port Moody in the Province of British Columbia; and also a branch line of railway from some point on the main line of the railway to Fort William on Thunder Bay; and also the existing branch line of railway from Selkirk, in the Province of Manitoba, to Pembina in the said province; and
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also other branches to be located by the company from time to time as provided by the said contract,—the said branches to be of the gauge aforesaid, and the said main line of railway, and the said branch lines of railway, shall be commenced and completed as provided by the said contract; and together with such other branch lines as shall be hereafter constructed by the said company, and any extension of the main line of railway that shall hereafter be constructed or acquired by the company, shall constitute the line of railway hereinafter called The Canadian Pacific Railway.
It is upon the construction of these two clauses that the contest mainly turns. Mr. Blake and Mr. Cassels for the James Bay Railway Company argued that the contract was one between the Government and the incorporators described as "The Company" and was only for the Eastern and Central sections and that the incorporators must complete building within ten years, and had only the right contemporaneously with their building of such sections to carry out and locate branches; that the "corporate entity" only became assignee of the privileges and franchises granted to the incorporators and could enjoy no higher rights than granted to the incorporators under the contract, and such rights were only, so far as we are here concerned, to locate branches up to May, 1891, and only from some point on the eastern and central sections to some point on land owned by the Dominion. I think this is a fair statement of the position taken by the counsel for the James Bay Railway Company. The Canadian Pacific Railway Company's counsel, Mr. Ewart and Mr. Aylesworth, contended that the "corporate entity," the Canadian Pacific Railway Company, had the right for all time to lay out and locate branches from time to time from any point on the main line between Callander and the Pacific sea-board subject, at the present time, to the filing of plans and approval required by the Railway Act, 1903; that from Callander eastward the rights of the company were governed by section 25 of the charter with which we are not now concerned. A great deal was said in argument
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as to the previous railway policy of the Parliament of Canada and the policy since in respect to other railways, and as to the public danger involved if a construction such as contended for by the Canadian Pacific Railway Company was adopted. We are not in one sense concerned with that construction. The purpose is expressed by the terms of the statute which are absolutely controlling as to the legislative intent, and while a construction which will produce a consequence so directly opposite to the whole spirit of our legislation ought to be avoided, if it can be avoided without a total disregard of those rules by which courts of justice must be governed, yet if Parliament has explained its own meaning too unequivocally to be mistaken the courts must adopt that meaning. We have only to declare what the law is, not what it ought to be, and I feel relieved from any doubt in this case which I might entertain (though I entertain none whatever) by the fact to which I attach considerable importance that successive Acts of Parliament have been passed by which Parliament itself has assumed as the correct one the construction I adopt. (I shall refer to these later.) The courts too have expressly in one case and by implication in another adopted one phase, viz., the right to build anywhere from the main line from Callander to the Pacific. I will also refer later to these more at length. On the question of the construction contended for by the James Bay Railway Company being likely to place the territory tributary to the main line from Callander to the Pacific in the grasp of a monopoly I would only say that in practice no such result has followed. Numerous railway charters have been obtained and railways actually built in many places where, if my construction of the charter and contract is correct, the fear of the right of the Canadian Pacific Railway
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Company to parallel, &c, would have deterred the application for the charter or the construction of the railway if capital was likely to be deterred by such fear. It is to be borne in mind also that in the United States, in most if not all of the states, the location of the line of its road is entrusted by law to the company alone, and that where a corporation has been organized in compliance with the conditions of the statute and has made a map and profile of the route intended to be adopted by the company, it has acquired a vested and exclusive right to build, construct and operate a road on the line which it has adopted subject to the right of other road companies to cross its route and lands in the way and manner provided by law. It would scarcely be urged that this policy, the very opposite to the one adopted here, has deterred railway building in the United States. It is to be further borne in mind that in this country all branches built by the Canadian Pacific Railway Co. to develop territory or to acquire traffic as the needs of the country arise, have to be approved as to the general route by the Minister of Railways and as to deviations, etc., by the Railway Committee and the public rights thus fully conserved; This of course has no bearing on the construction of the charter but is, I think, an answer to the argument of future monopoly which has been advanced as a reason for a different construction being the proper one to arrive at.
The general rule which is applicable to the construction of all other documents is equally applicable to statutes and the interpreter should so far put himself in the position of those whose words he is interpreting as to be able to see what those words related to. He may call to his aid all those external or historical facts which are necessary for this purpose and which led to the enactment and for those he may consult contemporary
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or other authentic works and writings. This however, does not justify a departure from the plain reasonable meaning of the language of the Act. The best and surest mode of expounding an instrument is by construing its language with reference to the time when and circumstances under which it was made, and next to such method of exposition is the rule that if an Act be fairly susceptible of the construction put upon it by usage, the courts will not disturb that construction. The authorities for these statements are too well known to render lengthy citation necessary. I refer, however, to Read v. The Bishop of Lincoln; Herbert v. Purchas; Maxwell on Statutes, (3 ed.) pp. 32-39, inclusively, pp. 423 and following; Broom's Legal Maxims (7 ed.) pp. 516-579. As to reference to House of Commons records for purposes of historical exposition, see The Attorney General of British Columbia v. The Attorney General of Canada; The Fisheries Case; pages 456-465 et seq.; In re Representation in the House of Commons, pages 497, 581-593. To apply, then, contemporaneous historical reference and. legislative and judicial exposition, the recital in the Act under consideration establishes that the Government of Canada was under obligation to construct a. railway connecting the sea-board of British Columbia with the railway system of Canada. The stated case contains the following admissions:—
(1) At the date of the Canadian Pacific Railway charter (1881) the territory through which its main line was to be constructed was, with the exceptions to be mentioned, almost completely uninhabited, and only by its general characteristics had become known to the people of Canada The exceptions to this statement are:
(a) A small settlement existed at Port Arthur and Fort William;
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(b) Southern portions of the Province of Manitoba and as far west as the present western boundary of the province had been surveyed and were sparsely settled, particularly in the neighbourhood of Rat Portage and the Red River district, where the Winnipeg settlement was;
(c) Some portions of the country between such western boundary and British Columbia had been surveyed into blocks of sixteen townships each;
(d) A small settlement on the British Columbia coast.
(2) From year to year after the date of the contract the Government of the Dominion of Canada caused portions of Manitoba and the North-west Territories to be surveyed and set off into townships and sections, but it was not until the year 1901 that the last of the townships in the North-West Territories and western part of Manitoba through which the railway runs was surveyed and set off into sections. Some of the territory in the eastern part of Manitoba and the western part of Ontario and in British Columbia, together with large tracts in Manitoba and the North-West Territories through which branch lines of the Canadian Pacific Railway may at some time run if the contentions of the Canadian Pacific Railway Company in question herein are sustained, have not yet been surveyed, even into townships, by the Government.
(3) At the date of the Canadian Pacific Railway charter the main line of the railway north of Lake Superior had been projected to run some distance north of the lake and join the line between the lake and Selkirk. The accompanying sketch marked plan No. 1 (partial copy of a map attached to the report of the then Engineer-in-chief of the Department of Railways—Mr. Sandford Fleming—dated 26th April, 1878) shows the projected junction of the eastern and Lake Superior sections of the railway and the line to Fort William as then contemplated. After that date the route of the main line was changed. The part of it lying north of Lake Superior was brought more to the south so as to skirt the lake, and the western end of the eastern section was made to join the eastern end of Lake Superior section at or near Fort William, as shown in the accompanying sketch marked plan No. 2, which is a partial copy of a map.
(4) Prior to the 1st May, 1891, the Canadian Pacific Railway Company, without any other legislative authority than that contained in the legistion of the Parliament of Canada appearing in the said statute 44 Vict. ch. 1, and the schedules thereto and the charter issued in pursuance thereof, constructed and equipped the branch lines of railway or extensions of branches in list A in paragraph 5 hereof. Subsequent to said 1st May, 1891, the Canadian Pacific Railway Company have constructed without any such other authority the branches or extensions of branches set out in list B in paragraph 5 hereof. In respect of the branches or extensions of branches set out in the said lists, those which are accompanied by the word "inspected" were inspected by a Government engineer and permission granted to the company to open such branches respectively for the public conveyance of passengers.
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LIST "A."
Branches of the Company's Main Line Constructed Prior to May 1st, 1893.
1. Ontario: The Algoma Branch from Sudbury to Sault Ste. Marie, 182.1 miles. Constructed 1883 and 6. (Inspected.)
2. Ontario: The Stobie Branch from Sudbury to Copper Mines, 5.6 miles. Constructed 1887.
3. British Columbia: The New Westminster Branch from New Westminster Junction to New Westminster, 13.7 miles. Constructed 1887. (Inspected.)
4. British Columbia: The Port Moody Branch from Port Moody to Vancouver, 13 miles. Constructed 1887.
5. Manitoba: The Pembina Mountain Branch from Winnipeg to Manitou, 110.1 miles. Constructed 1882. (Inspected.)
6. Manitoba: The Gretna Branch from Rosenfeld to Gretna, 13.7 miles. Constructed 1888.
7. Manitoba: The Selkirk Branch from Winnipeg to West Selkirk, 24 miles. Constructed 1883. (Inspected.)
LIST "B."
Branches Constructed Subsequent to First May, 1891.
8. Ontario: The Dyment Branch from Dyment to Ottamine, 7 miles. Constructed 1900. (Inspected.)
9. British Columbia: The Mission Branch from Mission Junction to Mission, 10 miles. Constructed 1895.
10. British Columbia: The Arrow Lake Branch from Revelstoke to Arrowhead, 27.7 miles. Constructed 1897.
11. British Columbia: The Coal Harbour Branch from Vancouver to Coal Harbour, 1.2 miles. Constructed, 1903.
12. Manitoba: An extension of the Stonewall Branch from Stonewall to Teulon, 19 miles. Constructed 1898. (Inspected.)
13. Manitoba: The Lac du Bonnet Branch from Molson to Lac du Bonnet, 27 miles. Constructed 1900. As to this branch the Dominion statute 63 & 64 Vict. c. 55, sec. 3, gives such authority as is contained in that section. (Inspected.)
14. Manitoba: The McGregor Branch from McGregor to Brookdale, 36 miles. Constructed 1900-02. As to this branch the Dominion statute 63 & 64 Vict. c. 55, sec. 3, gives such authority as is contained in that section. (Inspected.)
15. Manitoba: Extension of Souris Branch from Souris to Glenboro, 45 7 miles. Constructed 1891-2. (Inspected.)
16. Manitoba: Extension of Souris Branch from Napinka to Deloraine, 18.6 miles, Constructed 1892.
17. Manitoba and North-West Territories: The Pheasant Hills Branch from Kirkella in Manitoba to Haywood in the North-West Territories, 146 miles. Constructed 1903-4. (Inspected.)
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18. Manitoba and North-West Territories: The Souris Branch from Kemnay to Estevan, 156. 2 miles. Constructed 1891-2. (Inspected from Kemnay to Melita.)
19. North-West Territories: The Portal Branch from North Portal to Pasqua, 160.3 miles. Constructed 1893.
The undertaking was of a very exceptional speculative character and in turning to the Act, contract and charter we find unprecedented clauses. The Government bound itself to complete two sections, the Fort William Branch and the Selkirk and Pembina Branch, and hand same over to the contractors, to pay a cash subsidy of twenty-five million dollars and to give a land grant of twenty-five million acres to be fit for settlement and to be in alternate sections; the land grant to be free from taxation for twenty years from the grant from the Crown; the capital stock of the company and its stations, station grounds, workshops, buildings, yards, rolling stock, etc., to be exempt from taxation forever. There are other marked benefits conferred, a masterly summation of which may be found in Hansard, 1881, vol. 5, p. 517. I refer to this latter only to show that the undertaking was thought to be so hazardous that exceptional privileges were deemed necessary to induce the contractors to enter upon the undertaking and to give point to the consideration that it was extremely unlikely any person contemplated that branches would be required prior to May 1891; that the road was a colonization road and branches would be built as the country developed and the future revealed along what lines trade developed making the location and construction of branch lines feasible and practicable. This being the situation of the parties the contract was made with the incorporators and a charter was granted creating the corporate entity which, after the incorporators had performed the initial requirements, came into existence on the 9th April, 1881. As I have before indicated, in my view after that date
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it was such corporate entity which is described by the word company when that word is used in the contract and charter. This is apparent when section after section is examined.
Section 7. The railway constructed under the terms hereof shall be the property of the company.
(This must mean the corporate entity not the incorporators who are also as I have said referred to as the company). The same section provides "and the company shall thereafter and forever efficiently maintain, work and run the Canadian Pacific Hallway."
Section 9 The Government agree to grant to the company a subsidy in money of twenty-five million dollars and in land of twenty-five million acres.
Section 10 grants the road-bed to the "company." Section 11 grants the land to the company, and further on the grant of land is to be
on each side of any branch line or lines of railway to be located by the company.
Section 16 exempts forever from taxation the capital stock of the company and the lands of the company for twenty years from the Crown grant. As I have stated, according to Mr. Blake's argument, the word ''company" meant incorporators, and the incorporators' obligations ceased in May, 1891, and the rights acquired by the contract by them were by the Act and charter at that date and then only vested in the corporate entity. In sections 17, 18 and 20 the word "company" is also used in a sense wholly inappropriate to the incorporators described as such as it would scarcely be argued that when the company may issue land grant bonds, etc., the incorporators as contractors were meant and not the corporate entity. If then the corporate entity is intended to be described when the word "company" is used in the contract when section 14 says
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The company shall have the right from time to time to lay out, construct, equip, maintain and work branch lines of railway from any point or points along their main line of railway to any point or points within the territory of the Dominion
a sensible construction can be placed on the language. If the argument is acceded to that the contractors (the incorporators) are thus described the result follows that as the gentlemen named were only to build and own the eastern and central sections "their" line of railway is only the eastern and central part of the railway, and branch lines can only be built from such sections. Mr. Blake and Mr. Cassels urged this most strenuously pointing to section 13 which says:
The Company shall have the right * * * to lay out and locate the line of railway hereby contracted for
and as the only line contracted for was that part comprised in the eastern and central section, the language used in section 14 must be construed as I have indicated, and further that the words "within the territory of the Dominion" meant within land owned by the Dominion and not the area over which the Dominion Parliament exercised legislative jurisdiction. I may describe this as the argument of "place" as opposed to that of "time" with which I will deal later. To deal with "place" first. In my view the contract means that the company, the corporate entity at any rate up to May, 1891, could built branches anywhere from the main line of railway between Callander and the Pacific sea-board, and in using the words "territory of the Dominion" Parliament meant within the area over which the jurisdiction of the Parliament of Canada extended as to the whole main line of railway from Callander to the Pacific. If the construction argued for is to be placed on these sections it would lead to such obviously absurd results that' some other construction must be sought for. In pointing to these results 1 cannot do
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better than adopt some of the arguments of the counsel for the Canadian Pacific Railway Company upon this point:—
(1) A branch may commence at "any point or points along their main line of railway "—anywhere in any province—but it must end in the North-West Territory.
(2) For example, a branch may (indisputably) commence at Portage la Prairie in Manitoba and run south-west; but it cannot stop until it gets beyond the boundary of the province. It must finish in the Territories.
(3) Conversely a branch may (indisputably) commence at Regina in the North-West Territories and run north-east; but it must stop before crossing the Manitoba line. It must finish in the Territories.
(4) What more absurd provision than that a branch line may start anywhere along a 2,500 mile line of railway, but must always run towards its centre, and must finish there within a fixed limit of a few hundred miles.
Objection: Points "within the territory of the Dominion" means points upon land owned by the Dominion.
Pursuing the line or reasoning just submitted, it would appear that the effect given by the present objection to the clause under consideration is that although a branch may begin anywhere on the main line it must always finish upon Government property. It must not stop a mile short on Jones's land, or go a mile beyond to Smith's land. Some Government property must always be picked out for one of the termini.
So that if the Government did not happen to own a lot or two in a certain town, no branch could have its terminus there. And if in the town the Government did own a lot, the railway would have to lay the last
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rail upon it however inaccessible it might be—or stay away altogether.
And what if the Government sold the lot before the railway reached it?
I would also add, I find in the contract the draftsman there describing the North-West Territories says:
The company may, with the consent of the Government, select in the North-West Territories any tract or tracts of land. (Contract, sec. 11).
In the establishment of any new province in the North-West Territories. (Contract, sec. 15).
The lands of the company in the North-West Territories shall be free from taxation. (Contract, sec. 16).
Mr. Cassels also argued that if the company already possessed the power 10 construct branches in Ontario, why was it necessary to get special provision inserted in clause 15 of the charter in reference to the branch line from Fort William to the main line? This branch was to be built by the Government and acquired by the company, so that argument fails.
These considerations would be sufficient in my view to determine that the argument as to the places from which branch lines would be built could not be limited as to point of commencement to the eastern and central sections and, as to terminals, to land owned by the Dominion. But, when one sees how the court and Parliament have dealt with the subject, it makes the conclusion to be now arrived at irresistible.
This court has already held in The Canadian Pacific Railway Co. v. Major that the company had power to build a branch from Port Moody to Vancouver, and this branch was on the western section and in the area of the Province of British Columbia, but within the legislative jurisdiction for the purposes of railway authorization of the Dominion Parliament. It is true the present argument was not advanced to the court but it must be assumed that the
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court would not overlook so obvious a want of legislative authority as is contended for here. In the case of Ontario etc. Railway Co. v. Canadian Pacific Railway Co. the point urged as to the meaning of "within the territory of the Dominion" was, if correct, so complete an answer that one can scarcely understand if it was tenable if the court could say, at page 443,
no question was raised as to the authority of the defendants (the Canadian Pacific Railway Co.) to construct a line of railway to the Sault Ste-Marie,
and it is to be observed that the counsel now raising the question were engaged for the plaintiff in that case. For the action of Parliament, I refer also on this point to the list "A" before referred to, and to the list "B," 8 to 16 inclusive, as to the points from or to which branches could be built, all of which acts are opposed to the construction contended for.
I have therefore come to the conclusion I have above indicated that as to section 14, the line of railway referred to is the line from Callander to the Pacific seaboard, and that the words "territory of the Dominion" mean the area along such line or railway over which the Dominion Parliament had legislative jurisdiction.
I come now to deal with the time within which the right to build branches so authorized must be exercised. The clause pointed to under which it is claimed no branch could be built after May, 1891, is 15 of the charter before set out. The clause used the words "lay out, construct and acquire" and these have to be divided and made applicable to the subject matter. The company was not to "lay out or construct'' either of the branches nor two sections of the main line, but was to "acquire" these. That is the Government were under obligation to build two sections of the railway or two branches for the company and, as to these, the words "lay out" or "construct" are inapplicable to
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the company. There were other branches to be located from time to time by the company as provided by the contract. (Clause 14). When the draftsman says in clause 15 of the Act (schedule A),
the said main line of railway and the said branch lines of railway shall be commenced and completed as provided by the said contract
I take it he is referring to the various sections and described branches for the completion of which an obligation existed both on the part of the Government and the company under the contract, and when he refers to other branches to be located from time to time he refers to the branches under clause 14 which the, company have the privilege of building but as to which no contractual or other obligation existed. No time was fixed by the contract either for the commencement or completion of such branches and it is a misdescription to refer to them as having a time limit under the contract. The express right to lay out, locate and build from time to time given by the contract cannot be cut down by mere surmise that a power to build from time to time could not be contemplated because it would be out of harmony with existing railway policy. The contract was very keenly debated; the effect of this provision was drawn in the most marked manner to the public attention and denounced as mischievous. See Hansard vol. 5, p. 503. I refer to this not as throwing any light upon the meaning of the clause but as shewing the attention of Parliament was drawn to the existence of such a clause and that it was open to the construction claimed for it. The clause was passed and the list I have referred to shews the branches built since 1891 and the action of Parliament thereon from that date until the present time.
In a case decided by the Supreme Court of the United States in 183 [Illegible Text], in a court in which both those great jurists Chief Justice Marshall and Justice Story
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sat, and the opinion of the court was delivered by Mr. Justice Story, it was held that the naming of a society in a royal charter was a plain recognition by the Crown of the existence of a corporation and of its capacity to take the land in controversy and further that such a recognition would confer the power to take the land even if it had not previously existed. See 4 Peters, 480, at p 502, where the argument of Mr. Daniel Webster is given effect to by the court. I cite this case not as an authority but as entitled to great weight on account of the eminence of the counsel and Bench concerned in it. It seems to me to be on the same principle as the cases referred to by me before collected in Maxwell on Statutes, (3 ed.) pp. 428=429, and as Parliament has over and over again recognized the right to build branches after 1891, that great importance is to be attached to such Parliamentary interpretation or recognition. It is to be borne in mind also that on the faith of the contract being ample authority to build at any time branches within the limits described, large sums of money it was stated had been borrowed solely on the security of such branch lines and Parliament must have known that such would have been the inevitable result. It is said that Sir Oliver Mowat, in 1897, when Minister of Justice, advised that no such power existed, but, it seems tome, that the fact of Parliament subsequently disregarding and ignoring his advice and again recognizing the right to build both as to time and place, strengthens the position of the Canadian Pacific Railway Company in appealing to the doctrine of recognition embodied in the case in 4 Peters before referred to. It appears to me, therefore, that the time limit in clause 15 is only as to branches contracted for and has no application whatever to such branches as the company was privileged to build at its option.
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The third question it is perhaps unnecessary to answer in view of the opinion I have formed of the proper answers to the first two.
Assuming that ten years was the limit within which branch lines were to be built, I am of opinion nevertheless that as there are no words in the Act, charter or contract expressly providing that at the end of the ten years all power to built shall cease such as were used in Montreal Park and Island Railway Co. v. The Chateauguay and Northern Railway Co., that the power still exists until a forfeiture of such power is declared in properly constituted judicial proceedings. This is the rule in the United States. See Morawetz on Corporations, ss. 1006-1015; Thompson on Corporations, Vol. 5, ss. 6598-6602. In England I find no direct authority but if I am correct that the power still exists it would seem to follow that only in a suit to which the Attorney General is a party plaintiff (or if he refuses he may be made a party defendant) can the question be successfully raised. I do not decide this, however, as it is very doubtful where, as in this case, the James Bay Railway Company will be crossed and otherwise interfered with by the building of the branch and it has, therefore, a special and peculiar interest, whether it cannot raise the question. Hinckley v. Gildersleeve; Town of Guelph v. Canada Co.; Stockport District Waterworks Co. v. Mayor of Manchester; Pudsey Goal Gas Co. v. Corporation of Bradford, would seem to indicate that in such case the James Bay Railway Company would be entitled to be heard in a suit brought by it to restrain the Canadian Pacific Railway Company entering upon its lands. In this proceeding, however, ss. 3 and 5 of the general
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Railway Act, 1903, should be read in with clause 14 of the contract and as additional to it, and as the Canadian Pacific Railway Company have to file plans and obtain approval of them, the James Bay Railway Company would have a right to appear and appeal to the discretion of the Minister of Board on such application. It is doubtful if the court could compel the Minister or the Board to act if in his or its bond fide discretion approval of plans was declined Attorney General v. Toronto Junction Recreation Club; In re Massey Manufacturing Co. shew when the court can interfere and compel executive action.
I think the Minister or Board has more than ministerial powers and represent the Crown, and it seems to me that this distinguishes the case from a mere action by a private party when, even with his special interest, he might be precluded from raising the question as to which I do not think we are called upon to decide. I think, in this application to the special tribunal created by the Act, the James Bay Railway Co. may be heard.
I would therefore answer to the first question:
The Canadian Pacific Railway has power to construct the branch referred to and the time within which such branch ought to be constructed has not expired.
To the second question; Yes.
To the third question; Yes
Idington J.—Under the Railway Act of 1903 the Board of Railway Commissioners submit for the opinion of this court the following questions:
1. Has the Canadian Pacific Railway Company, under the legislation, schedules and charter aforesaid, now power to construct the branch line referred to. or has the time expired within which such branch line might be constructed?
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2. Do such legislation, schedules and charter authorise construction by the said company of the proposed branch line, it being altogether situated in the Province of Ontario?
3. Is it open to the James Bay Railway Company or to the Board of Railway Commissioners to take the objection that the time within which the said company may build branch lines under its charter has expired.
The legislation, schedules and charter aforesaid consist of 44 Vict. ch. 1, and the schedules annexed thereto, of which latter the first is a copy of the contract between Her Majesty and certain gentlemen who undertook thereby to build parts of the Canadian Pacific Railway, and the second is a copy of the legislation that became the authority for the issue of the letters patent creating the Canadian Pacific Railway Company.
It is the extent of the corporate powers of this company as to building branch lines that is now called in question. The questions asked must be answered by the meaning given to sec. 14 of the contract schedule just referred to.
To interpret it properly regard must be had not only to the rest of the contract and the enactment that gives it vitality, but also to the history leading up to it and the conditions immediately surrounding it.
Whilst all must be looked at and the whole considered together, we must bear in mind that the one schedule contains a temporary contract and the other the foundation for a chartered corporation that was to have a perpetual existence.
The contract was with certain parties who could not, save by the creation of the corporation, transfer their rights to any one else.
The corporation was to consist not only of such parties, but also of such others as they might associate with them as shareholders. The contract was only to be binding in the event of the Act of Incorporation being granted to the company in the form of schedule "A."
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Section 21 of said contract that shews this, is as follows:—
21. The company to be incorporated, with sufficient powers to enable them to carry out the foregoing contract, and this contract shall only be binding in the event of an Act of incorporation being granted to the company in the form hereto appended as schedule "A."
This legislation having been passed providing the Act of incorporation, the contract became thereupon immediately binding and the contractors then might or not as they saw fit seek for the immediate issue of the letters patent creating the corporation. They were not bound to do so. No part of this contract expressly rendered it necessary to do so.
"Whatever may have been the design of this cumbrous method and the hiatus that was to exist between the legislation providing for, and the incorporation of, the company, it is important to mark the existence of this hiatus for it enables one more clearly to observe by the actual segregation of the contract from the incorporation and incorporating enactments that there may, and perhaps must, be attached to each of the provisions of the contract a meaning quite independent of anything else in schedule A which might never have been called into active existence.
I have no doubt that the parties who provided this condition of things had some real purpose in view and that it did not come about as mere accident.
Its resultant effect on the meaning we must give to the provisions of the contract is not to be waived off by saying that the promoters, though contractors, never intended or were intended to construct the railway. Their legal position by virtue of this contract was that they must, and that there was no other means of escape from its obligations than by and through the creation of a corporate body which the contract did not render by its express terms at all obligatory on them to bring into being.
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Let us, therefore, interpret this contract as we can, and as far as we can, by itself as an independent document, but of course to be interpreted in light of what had gone before and the then surrounding conditions.
The first clause thereof interprets "The Canadian Pacific Railway" to mean the entire railway as described in 37 Vict. ch. 14, and the individual parties thereto as described by the words "The Company."
The words "The Company" being a term that might appropriately be applied to the corporation to be formed, when formed may have been used in anticipation thereof and designed to bear a reference as occasion called for it to the syndicate body or the corporate body, but this possible double use or meaning in no way ought to be permitted to confuse us.
The primary meaning of the term "The Company" in this contract, and particularly in every place where present contractual obligation or present privilege or franchise is designed to be expressed, must mean the individuals as contractors.
When those privileges and franchises have been transferred to and those obligations imposed on the corporate body by the occurrence of certain events, and the operation of the enactments that anticipated such events, and the Parliamentary assignment resultant therefrom has taken effect, the term "The Company" may be read then and thereafter in the same clauses or some of them as descriptive of or meaning the corporation.
Meanwhile the term "The Company" designates contractors who have undertaken certain work. It means no one else.
The Canadian Pacific Railway which is in question in this contract and interpreted therein as I have pointed out by reference to 37 Vict. ch. 14, is by sec. 1 thereof defined as follows:
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1. A railway, to be called "The Canadian Pacific Railway," shall be made from some point near and south of Lake Nipissing to some point in British Columbia, on the Pacific Ocean, both the said points to be determined and the course and line of the said railway to be approved of by the Governor in Council.
3. Branches of the said railway shall also be constructed as follows, that is to say:
First. A branch from the point indicated as the proposed eastern terminus of the said railway to some point on the Georgian Bay, both the points to be determined by the Governor in Council.
Secondly. A branch from the main line near Fort Garry, in the Province of Manitoba, to some point near Pembina, on the southern boundary thereof.
And by sec. 4 thereof it is enacted that
the branch railways above mentioned shall, for all intents and purposes, be considered as forming part of the Canadian Pacific Railway.
This railway was in process of construction by the Government when this contract was entered into.
The road to be built has been divided into four sections, of which the terminal points were in this contract more accurately defined than in 37 Vict. ch. 14. Two of these sections had been partially constructed and were by this contract allotted to the Government to complete, and the other two, called respectively the eastern and central sections, were by the contract assigned to the company for construction.
The Selkirk branch, from Selkirk to Pembina, was then completed. Sections 13 and 14 of the contract are as follows:
13. The company shall have the right, subject to the approval of the Governor in Council, to lay out and locate the line of the railway hereby contracted for, as they may see fit, preserving the following terminal points, namely: from Callander station to the point of junction with the Lake Superior section; and from Selkirk to the junction with the western section at Kamloops by way of the Yellow Head Pass.
14. The company shall have the right, from time to time, to lay out, construct, equip, maintain and work branch lines of railway from any point or points along their main line of railway to any point or points within the territory of the Dominion. Provided always, that before commencing any branch they shall first deposit a map and plan of such branch in the Department of Railways. And the Government shall grant to the
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company the lands required for the road bed of such branches, and for the stations, station grounds, buildings, workshops, yards and other appurtenances requisite for the efficient construction and working of such branches, in so far as such lands are vested in the Government.
It is this right from time to time to lay out, etc., branch lines of railway, etc., that is now said by the Canadian Pacific Railway Company here to continue for all time as theirs.
The question has been approached and argued as if the company had always existed, and as if it had been owner or in some way master of the main line from end to end of the original project, and as if the words "their main line" in sec. 14 meant the whole main line.
Had that been the case, and the corporate company had an existence when this contract was entered into, one could understand the reason for asserting that the term "their main line" means what is now claimed by that company.
Not only, as I have pointed out, is this not the case, but it was certain contractors only who were given the rights there and now in question. These contractors had by said sec. 13 only the right, subject to the approval of the: Governor in Council, to lay out and locate two sections of the main line, and the subsidies of $25,000,000 and 25,000,000 acres of land that they were to get by sec. 9 of the contract were mainly given for that work, and were to be paid and granted as the work of construction proceeded. The subsidies were by subsec. (a) of sec. 9 appropriated in relation to said central and eastern sections on the respective bases as to land and money as therein appears.
What concerns us here is to observe that those subsidies were to be paid or granted as the work of construction of those two. sections progressed and became in twenty mile sections completed, so as to admit of the running of regular trains thereon. These subsidies
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would by this process be exhausted by the time of the completion of these two sections, which time was fixed at 1st May, 1891.
If we remember the limited authority given the company by sec. 13 and that their contract for construction had nothing to do with what was beyond their two sections, and that, though by sec 7 they became entitled to running rights over the other sections being constructed and to be constructed by the Government as same were completed, they were not to have any right of property therein until the eastern and central sections had been completed by them, and then only as Government had completed its parts, which need not be until 1st May, 1891, we will be able to understand the very peculiar words "their wain line" in this sec. 14. We see thus why what at first blush seems a strangely inapt expression is used. "Their main line" were the central and eastern sections built by them.
Its true meaning being thus seized, it is plain that their rights to build branch lines were limited to that part of which they were in a limited sense masters. This also furnishes obvious common sense reasons for giving powers to build branches from their main line, when one reflects on the probable needs of construction and the anticipated colonization of the country that the contractors were becoming so deeply interested in.
Without giving to these words "their main line" a meaning that they will not bear in light of what I have adverted to or attributing to the man who drafted this contract a poverty of language or ignorance of its precise meaning that he nowhere else indicates as one of his failings, 1 think these words must be held to refer only to the two sections that were then, as they
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were constructed, to become the property of the company of contractors.
We find on turning to sec. 11 provision for selecting lands along and for 24 miles deep "on each side of any branch line or lines of railway to be located by the company and to be shown on a map or plan to be deposited with the Minister of Railways."
This indicates nothing beyond a plain intimation that at least some branch lines of the nature indicated were expected to be built during and within the time when the company had to have their contract finished and be in a position to select their lands.
It is said, however, that all this does not, and that the contract does not, in express terms put a limit of time or place upon the expected construction of branch lines. I have indicated why I think the part or place was limited. If I am right in that limitation, I am unable to comprehend why it should exist in that limited way only unless we are to construe the grant of this power as one to be exercised only as incident to and during and not beyond the period fixed for the construction of those two sections in relation to which the parties were speaking and contracting, to be known as the eastern and central sections. "Within such limits one could understand such a grant being made. Time and the existing condition of things would keep is exercise within reasonable bounds. If it were intended as a general power for all time I can see many more reasons for its creation or existence in relation to the other sections after construction than I can in relation to those to which my interpretation confines it.
And why, if intended in the sense now contended for, should the extension of the then existing Selkirk and Pembina branch and branches from such an important branch have been omitted?
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We thus find the probable limitation of time, without imputing absurdity either in language, intention or construction.
Without formulating any rule or pushing any canon of construction too far for this complex matter of a grant, a contract and a Parliamentary concession rolled into one to bear, I think I am safe in saying that we need to seek for a reasonable meaning or intention and to avoid, if possible, that which would be repugnant to the then mode of thought and strangely inconsistent with the remainder of the contract.
That which I now suggest would not be unreasonable.
We find it by considering the contract as a whole, and the legislation before and with it, including Schedule A as a whole. We are forbidden by considering the Consolidated Railway Act of 1879, which was the deliverance of this same Parliament as to the general policy, of that time, in regard to railways and especially as to their branch lines, and the time within which main lines should be constructed, and in the application of that Act to the undertaking in question, to give this paragraph the meaning now contended for by the Canadian Pacific Rly. Co.
The lines upon which this contract was framed had been laid down by 37 Vict. ch. 14, in every essential feature.
Except in regard to the extent of the subsidies and the financial arrangements based thereon, speaking in a comprehensive and general sense, there was no material departure from those lines unless we are to interpret this contract as conferring upon the contractors the right (as now asserted) forever to build branch lines.
Why should we suppose such a radical change of purpose or of policy? Why when decided upon, if
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ever decided upon, should we find it conferred by a grant of a personal and non-assignable franchise and not expressly given to the perpetual corporation as such?
I think we should be slow to attribute to Parliament an assignment forever of all right of control over the power of a railway company, building a line of such magnitude as this one, to build when, where and how it saw fit such branch lines as the company should decide to build. The aspect of national importance, from both the political and commercial points of view, seems also to forbid such a purpose, and especially such a sudden change of purpose.
Of course, even if the purpose, so repugnant to all this, and the thought of that time, were yet plainly expressed we must give effect to it. It has not been so expressed unless we impute to the words "from time to time" as used here the meaning of "forever." The contrary to my mind was intended, if not expressed in words, and the power of building branches was limited to those sections that the contractors undertook personally to build, and to the time of limitation for that building, and incidental thereto, as part of the whole, that whole being the completion and delivery over of the parts and branches so built to the future controlling power that from the 1st May, 1891, if not earlier, was to use the whole road.
It would seem from all this not only that the intention of the parties to the contract is discovered by reading it with regard to these limitations of time and space for the operation of the powers given by sec. 14 but also that full effect is given to the words "from time to time" when read to mean so long as the constructive period that these contractors might possibly have something to say in regard to the subject matter, and not to mean from time to time forever.
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A remarkable feature of this matter is that in so far as affecting the then present and soon or immediately to become operative contractual obligations, privileges or franchises this contract and the Parliamentary transfer thereof are implicitly relied upon to execute the purpose of the parties, but when it comes to the exercise of a right that would come into or might only come into being, or rather that the parties intended should have a right to exist and become at a later period a perpetual right, vested in the corporate company, the parties to this contract do not rely upon this contract, ample as are its powers, but in regard to its accruing future rights of paramount and permanent importance they are careful to repeat the provisions therefor in the legislation.
See for example the repetition in sec. 3 of the Act, of the contract conditions in regard to the perpetual and efficient operation of the railway and the money and land grants, and in sec. 5 of the Act of the future running rights over the road and ownership of same as completed, and of the whole when completed.
The deposit, the standard of construction, the times for completion, the grants of land for road bed &c, the extinction of Indian title, the restriction of competitive lines, some of the bonding provisions, and the right to build branch lines, are all treated alike as of a temporary character and permitted to rest upon the contract, also temporary, and are not repeated elsewhere. That which is not necessarily legislative in its character but merely contractual is governed by the contract. That which is to abide for all time is as one would expect treated as needing direct legislation.
I recognize that this line of distinction is not adhered to in every respect and literally, but when we look at the contract and the legislation I think there exists a clear line of demarcation such as I have indicated
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between what was temporary in character and that which was to be permanent, and we find such an important matter as the construction of branch lines omitted entirely from the permanent side of the line of demarcation. Why should it from its importance and permanency not find its place there?
All the Syndicate had acquired by this contract was transferred by the operation of sees. 3 and 4 of schedule "A," as soon as the letters patent were issued and the provisions of that schedule became operative, but that transfer did not enlarge the power to build branches beyond what had been possessed by the contractors. It transferred a right which at best could not have extended beyond the lives or surviving life of those to whom it was granted as a personal right, license, or franchise. I have to repeat that it could never extend by this contract to their assigns, for they were not named in the instrument framing the personal grant.
This being the only alternative limitation of the grant indicates again in another way the intention of the contracting parties that the right to build such branch lines should exist only in relation to and during the process of construction of what they had respectively undertaken should be done by each.
Now, coming to the consideration of sec. 15 of schedule "A," which is as it were a summing up of the whole matter, and seems conclusive upon close analysis thereof as binding us to adopt a temporary and not a perpetual time for the existence of the right to build those branch lines, sec. 15 is as follows:—
15. The company may lay out, construct, acquire, equip, maintain and work a continuous line of railway, of the gauge of four feet eight and one-half inches; which railway shall extend from the terminus of the Canada Central Railway near lake Nipissing, known as Callander Station, to Port Moody in the Province of British Columbia; and also a branch line of railway from some point on the main line of railway to Fort William on
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Thunder Bay; and also the existing branch line of railway from Selkirk, in the Province of Manitoba, to Pembina in the said province; and also other branches to be located by the company from time to time as provided by the said contract,—the said branches to be of the gauge aforesaid; and the said main line of railway and the said branch lines of railway, shall be commenced and completed as provided by the said contract; and together with such other branch lines as shall be hereafter constructed by the said company, and any extension of the said main line of railway that shall hereafter be constructed or acquired by the company, shall constitute the line of railway hereinafter called The Canadian Pacific Railway.
This, analysed, provides as follows:
(1.) "A continuous line of railway" &c.
(2.) "A branch line of railway from some point on the main line of railway to Fort William on Thunder Bay."
(3.) The existing branch line of railway from Selkirk in the Province of Manitoba to Pembina in the said province.
(4.) And also "other branches to be located by the Company from time to time as provided bp the contract"
4a. "The said branches to be of the gauge aforesaid."
(5.) "And the said main line of railway and the said branch lines of railway shall be commenced and completed as provided by the said contract.
(6.) "And together with such other branch lines as shall be hereafter constructed by the said Company, and any extensions, &c......... shall constitute the line of railway hereinafter called the Canadian Pacific."
Observe that there are only two specific branches named, of which one is already existing and not needing "to be located" or built.
When we ask the meaning of the 5th paragraph of this analysis we find the plural—"branch lines of railway"—used. It cannot, therefore, only refer to the specified branches preceding it, as there is only one "to be commenced and completed." It must, therefore, of necessity include another or others.
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What other or others? Those that "shall be commenced and completed as provided by the said contract, is the only possible reply, to begin with. And they can, in the next place, only be those (in the 4th paragraph of analysis) "other branches to be located by the Company from time to time as provided by the contract"
Whether I have made my meaning clear or not, this seems to me as simple as the simplest mathematical problem. It is said, however, that though this be taken as the correct rendering of the language used, the words "commenced and completed as provided by the said contract", do not refer to branches, or at all events to those "to be located" branches. It cannot refer to any branches unless it be those branches to be located, for the contract does not name or refer by name to the branch here specified to Fort William at all.
Moreover, the Fort William branch was not off or from the eastern or central section at all, and if what is now contended for by the Canadian Pacific Railway Company ever was supposed to have a foundation in fact, there was no necessity for referring in this incidental way to the Fort William branch. If the company had a right by the terms of the contract to build any branches they saw fit, there was no necessity for specially describing or apparently thus enabling them to build the Fort William branch.
No other branch is, or I submit can be, in question if those here referred to as "to be located" do not answer the description.
Are we then, not being able to find something to which to apply those words (in paragraph 5 of this analysis) to read the paragraph as if the words "and the said branch lines of railway" had no existence or meaning?
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Is it to escape, as the only way of escape, from the imperative words "shall be commenced and completed as provided by the said contract" that we are to resort to that alternative?
I think that they should be read in light of what I have adverted to as applicable to what may or shall have been done within sec. 14 of the contract, and that only. We thus, and only thus, can give effect in a reasonable and natural way to every word in this sec. 15.
And when we have done so, we look back to the contract to find what is meant by these words completed as provided by the said contract," which plainly imply a period of completion.
I think the 6th paragraph of this analysis relates to the branch lines which the Railway Act gives power to construct, and such other lines as might lawfully be constructed by or acquired by the corporate company.
Such anticipatory words are in such legislation useful and were appropriately used here.
I am in this view not troubled about the Algoma branch legislation, the Sudbury branch legislation, or any other legislation relating to those branches built or partly built within the time limit I have suggested, nor am I in this result troubled about small branches within the powers given by the Railway Act of 1879.
What is relied upon as happening since May, 1891, as confirmatory of the pretentions now put forward by the company, is for the most part thus disposed of and what remains is of an administrative character that ought not to influence any court in the interpretation of an Act of Parliament. I am unable to understand why some of these incidents have been allowed to trouble us at all. The branches running off the
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branch lines, as, for example, the Souris Branch, surely cannot help us to interpret the powers of the company in regard to branch lines running from a point on their main line.
What was done in relation to these subsidiary branches illustrates when closely examined a variety of cases such as a parliamentary beginning within the time, a carelessness or audacity as to whether powers had or had not existed after the time expired, and finally a statute expressly granting the power by 63 & 64 Vict., ch. 55, to build just the same sort of branch lines if not the same as are here expressly put before us as exemplifying alleged parliamentary recognition, or extensions thereof.
The company petitioned Parliament for this grant of new powers, and in this same Act there is provided, expressly as it seems to me, that two lines off and from the main line shall be built by virtue of the powers therein given.
It looks very much as if in 1900 the company had abandoned, if indeed it ever seriously had before then put forward, the contention here in question.
The Arrow Lake branch is apparently part of the Kootenay railway scheme, for which there was independent legislation, and by 54 & 55 Vict. ch. 71, s. 2, as well as a preceding section, this company is empowered and protected
The Pheasant Hills Branch grant was to be commenced within two years from 1st August, 1903, completed before the end of four years from that date, or as fixed by the Governor in Council, and to be constructed according to the description, conditions, and specifications approved by the Governor in Council on report of the Minister of Railways and Canals, and specified in a contract with the Minister, who is empowered, with approval of the Governor in Council, to make it,
[Page 118]
and the location of the line is to be subject to the approval of the Governor in Council, and by sec. 6, the Governor in Council may at all times secure to other companies running powers and reasonable facilities for enjoying same equally, etc. And the Governor in Council is to have control over all tolls, etc.
Indeed much time spent on this branch of the case following up the data given, so far as given, leads me to the conclusion that all the grants relied upon as some recognition of the existence of the powers now claimed were conditional upon terms to be imposed by the Governor in Council. And where the branch line involved a bonding power, as in the case of the Kootenay and other companies, no reliance was placed upon the powers now claimed and existing, but parliamentary sanction or confirmation was sought and got for what was to be done.
I am quite aware that much of the reasoning I have adopted in reaching the conclusions I have is not in accord with that by which some of the former members of this Court arrived at their conclusions in the case of Canadian Pacific Railway Co. v. Major, which might have been supported on other grounds, and also does not necessarily govern us in this case.
With great respect and regard for those who decided that case, I take the liberty of thinking here that in some respects the arguments presented to us now were not presented then. It was admitted by counsel that if the time had elapsed within which the power to build branches was given, the question of the extent of that power need not be answered.
I therefore confine myself on this point, without concealing my opinion, to saying in reply to question No. 1, that the time has expired within which such branch line might have been constructed.
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And as to the third question, I think in view of the great length of time that has elapsed, in my judgment, since any such power existed in the company and nothing as to the work in question here done under it, or asserting it, save filing of plans in question here, that it became the duty of the Board of Railway Commissioners to consider and determine the question of right, or extent of right, existing in the company when they applied to that Board and within their exercise of powers to determine, and that the Board could hear any one interested as the James Bay Railway Co. seemed to be here; and that Company as well as the Board had the right to take the objection taken.
This is a case of the limitation of the company's powers by time and space that were as I find defined.
It raises none of the questions that might have arisen in regard to work that had been only partly done when the time expired.
Solicitor for the Canadian Pacific Railway Co.: A. R. Creelman.
Solicitors for the James Bay Railway Co.: Blake, Lasli & Cassels.
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