Supreme Court of Canada
Robertson v. City of Montreal, (1915) 52 S.C.R. 30
Date: 1915-10-12
Donald Robertson
(Plaintiff) Appellant;
and
The City of
Montreal and The Canadian Autobus Company (Defendants) Respondents.
1915: May 26, 27; 1915: October 12.
Present: Sir Charles Fitzpatrick C.J. and
Idington, Duff, Anglin and Brodeur JJ.
ON APPEAL FROM THE COURT OF KING’S BENCH, APPEAL SIDE, PROVINCE OF
QUEBEC.
Municipal corporation—Powers of
council—Highways—Exclusive privilege—Necessity of by-law—Validity of contract—Right
of action—Status of plaintiff—Shareholder in joint-stock
company—Ratepayer—Special injury—Public interest—Prosecution by
Attorney-General—Practice—Art. 978, C.P.Q.
Assuming to act under authority of an
existing by-law regulating traffic by autobusses and in virtue of a special
statute (2 Geo. V., ch. 56 (Que.)), and the general powers conferred by the
city charter the municipal council passed a resolution authorizing the
corporation of the municipality to enter into a contract granting a joint stock
company the exclusive privilege of operating autobus lines on certain streets
in the city and charging fares for the carriage of passengers. An action was
brought by a shareholder in a tramway company (which held similar privileges),
who was also a municipal ratepayer attacking the validity of the by-law and of
a contract made by the municipal corporation in pursuance of the resolution on
the grounds that there was no authority for the granting of such exclusive
privileges, that such powers, if they existed, could only be exercised by means
of a by-law, and that a provision in the contract whereby the municipality
became entitled to certain shares in the stock of the autobus company was ultra
vires of the municipal corporation.
Held, affirming
the judgment appealed from (Q.R. 23 K.B. 338), Idington and Anglin JJ. dissenting,
that in the absence of evidence
Note.—Leave to appeal to the Privy Council was refused on the 18th of
December, 1915.
[Page 31]
of special injury sustained by the plaintiff,
he had no status entitling him to bring the action.
Per Idington
J., dissenting.—The plaintiff was entitled to institute the action by virtue
either of his quality as a shareholder in the tramway company, the privileges
of which might be injuriously affected, or as a ratepayer of the municipality.
Per Anglin J.,
dissenting.—The plaintiff could bring the action in his capacity as a ratepayer
of the municipality.
Per Fitzpatrick
C.J. and Duff and Brodeur JJ.—An appropriate remedy in such a case would be by
action prosecuted by the Attorney-General of the province under article 978 of
the Code of Civil Procedure.
Per Duff
J.—Such an action might be prosecuted either by the municipal corporation
itself or by an authority representing the general public.
Validity of the by-law, resolution and
contract in question discussed by Idington, Duff and Anglin JJ.
APPEAL from the judgment of the Court of King’s Bench, appeal side, affirming the judgment of
Demers J., in the Superior Court,
District of Montreal, dismissing the plaintiff’s action with costs.
The material circumstances of the case are
stated in the judgments now reported.
Lafleur K.C. and R. Taschereau K.C. for
the appellant.
Atwater K.C., Bisaillon K.C. and J. A.
Archambault K.C. for the respondents.
The Chief Justice.—In my opinion, the appellant is not qualified to bring suit. A
ratepayer who has not suffered any special injury, but only such as is public
in its nature and affects all the inhabitants alike, has no interest entitling
him to bring action against the city. It is against public policy that he
should be permitted to do so.
[Page 32]
It is undoubtedly the law in England that such a
suit can only be brought with the permission and in the name of the
Attorney-General representing the Sovereign, the parens patriœ. Apart
from any presumption to which this fact may give rise in favour of the
principle the grounds on which it is based seem clear. Rule in France,
Garsonnet, vol. I., No. 376.
It would be difficult for public business to be
carried on at all if every individual in a city with a population of half a
million persons could sit in judgment on all the actions of the civic
authorities and any crank were at liberty to drag them at any time before the
courts. The city would never be free from litigation with its attendant expense
when, as would probably be often the case, the complainants were men of straw.
But there is more than this. That which is for
the general benefit of all the ratepayers may cause an injury to the private
interests of any particular ratepayer which would far outweigh any advantage
which he might gain simply as one of the body of ratepayers. This injury may or
may not be actionable. If, for instance, his property is taken for the common
purposes he will have a right of action, but if it is merely in his capacity as
a rival trader that he suffers loss this may well give rise to no cause of
action.
The appellant is the private secretary of the
Montreal Tramways Co. and, as found by the trial judge, is only the “prête-nom”
of a rival company. He originally claimed qualification as holder of a few
shares in the company transferred to him for the purpose of the action. This
clearly gave him no title to sue and in the course of the proceedings he
abandoned the claim. His claim as a ratepayer is not bonâ fide as
[Page 33]
such. The contract is not against the interest
of the ratepayers generally, but in their favour and the appellant is using his
interest as a ratepayer not for the benefit of the whole body of ratepayers,
but in the interests of his private business. This claim as a ratepayer is an
attempt to do indirectly what he cannot do directly.
Nevertheless, it is necessary to consider
carefully what is the law, since if it permits the bringing of such actions,
the courts have to give effect to it whatever inconvenience may result from
such a course.
Article 77 of the Code of Civil Procedure
provides that
no person can bring an action at law unless
he has an interest therein.
This is merely a formal statement of a rule that
is elementary in every system of law. The difficulty that may arise is in
determining what is an interest in the particular case.
In a Scotch case recently before the House of
Lords (Dundee Harbour Trustees v. Nicol), Lord Dunedin in his
judgment said:—
By the law of Scotland a litigant must
always qualify title and interest. * * * I am not aware that any one of
authority has risked a definition of what constitutes title to sue. I am not
disposed to do so.
There is, I think, similarity as to this between
the Quebec and the Scotch law and I do not myself propose to attempt any
definition of what constitutes an interest within the meaning of article 77,
C.P.Q.
It seems clear that there must he some
limitation placed upon the word. Farmers in the west of Canada
[Page 34]
whose produce is all sent to be shipped from the
Port of Montreal must certainly have an interest of a kind in the affairs of
the city. Indeed, every Canadian might be said to have an interest in the good
government of the commercial metropolis of the country.
When the interest which the individual has is no
greater or other than that of the rest of the public he has not, in my opinion,
an interest in the action within the meaning of article 77, C.P.Q.
But no one is on this account without remedy. An
individual can always inform the Attorney-General who can, and, in a proper
case, must, take action thereon (art. 978, C.P.Q.). If the Attorney-General
does not consider the case a proper one for him to intervene in he can permit
the complainant to use his name and the action is then brought in the name of
the Attorney-General on the relation of the individual informant. There is in
this practice the advantage that the Attorney-General can impose such terms for
security for costs being given as in the circumstances of the case he may deem
proper.
Then it must not be forgotten that section 304
of the charter of the City of Montreal (62 Vict. ch. 58) provides a special
remedy in favour of any individual ratepayer. In the
manner provided in this section
tout contribuable peut,
par requête libellée, en son nom,
présentée à la cour supérieure, demander l’annulation d’un règlement pour le
motif d’illégalité.
This provision does not necessarily imply either
that there would be otherwise no remedy or that any previous right of action is
superseded. There might, however, be some presumption that the latter
alternative was the intention of the legislature. It is common
[Page 35]
where the intention is otherwise for the
legislature to state explicitly that the remedy it provides is to be in
addition to, and not in lieu of, any existing remedies. I do not doubt,
however, that but for this provision individual ratepayers would have had no
right to take action such as this section expressly confers upon them.
When we come to examine the jurisprudence on the
subject, I think it is doubtful whether the courts have given any decisions
that conflict with the principle under consideration.
I do not wish to enter at tedious length into a
discussion of any that may be supposed to do so; most of them, at any rate,
can, I think, he distinguished. There is, however, one class to which the
majority probably belong to which I must call attention. There are cases in
which property is involved on which the courts fastening a trust have held that
fiduciary relations existed between the parties. It is on this ground that a
corporation in the capacity of a trustee is allowed to be sued by an individual
inhabitant as one of the cestuis que trust.
In the United States this right and the doctrine
on which it is based are distinctly recognized. Thus, in Dillon, on Municipal
Corporations (5 ed.), vol. IV., p. 2763, sec. 1579, it is said that in the
United States the right of property holders or taxable inhabitants to resort to
equity to restrain municipal corporations under such circumstances is
established; the origin of the equitable doctrine is explained in the following
sections. In the much quoted judgment of the United States Supreme Court in the
case of Crampton v. Zabriskie,
it was said:—
[Page 36]
Of the right of resident taxpayers to
invoke the interposition of a court of equity to prevent an illegal disposition
of the moneys of the county or the illegal creation of a debt which they in
common with other property holders of the county may otherwise be compelled to
pay, there is at this day no serious question.
It will be observed that in the United States
the proceeding is one in equity. Whether the courts in this country would in
like cases assume to exercise a similar equitable jurisdiction need not be too
closely inquired into. The present case offers no occasion for the raising of
any trust or the jurisdiction flowing therefrom.
To this class of cases belongs the case to which
I have already referred, of the Dundee Harbour Trustees v. Nicol, though the principle on
which it depends may not be so expressly recognized. In that case the
appellants had been constituted by statute a body of trustees to be elected in
part by the shipowners and harbour ratepayers of Dundee, and the Act vested in
them certain property and rights. They made a use of part of their property for
purposes not authorized by the Act and which involved the risk of its loss. It
was held that they could be restrained from so doing and that the respondents,
who were shipowners and harbour ratepayers, had a good title to maintain the
proceedings. The Lord Chancellor said:—
Reading the sections together I think that
the effect of the statute is to establish a trust comprising a fund made up of
rates, ferry dues and other sources of income as well as of sums authorized to
be borrowed. * * * It appears to me that the respondents have an interest as
beneficiaries in the fund so constituted and in the undertaking. * * * I see no
reason in point of principle to doubt that this beneficial interest in the
trust funds and undertaking, which are vested in the appellants as a
corporation with limited
[Page 37]
powers, is sufficient to enable the
respondents individually to claim to restrain dealings which are ultra vires
with the trust funds and undertaking.
And, after referring to the usual and proper
practice in England to invoke in such a case the assistance of the
Attorney-General, he said that he thought it probable that even in England a
harbour ratepayer in such a case
whose interest in the undertaking and funds
is apparent ought to be treated as within the analogy of the principle, which
enables a single shareholder to sue in his own name to restrain an ultra
vires action.
Lord Dunedin, who delivered the principal
judgment on the point, insists on the argument that the respondents being
persons for whose benefit the harbour is kept up have a title to prevent an ultra
vires act of the appellants which directly affects the property under their
care.
So that it was really as trustees of the
property to which the respondents had contributed and in which they were
beneficially interested that the appellants were sued, and it was to prevent
the loss of that property through their improper acts.
There can be no analogy between such a case and
that of a ratepaper suing to prevent acts which neither involve any property in
which the ratepayers are interested as cestuis que trust, nor impose any
taxation or burdens upon them, but on the contrary are for their common
advantage.
If I have dealt more fully with this case than
its concern with the present case calls for, it is because it is the most
recent case on the subject and has the authority of the final Court of Appeal
for the United Kingdom. It illustrates well, moreover, the character
[Page 38]
of the class of cases in which a single
individual can sue as one amongst a number of beneficiaries a corporation in
whom property is vested in trust for all such beneficiaries.
As regards cases in the Canadian courts,
particularly those of the Province of Quebec, I do not desire to say more than
that I think the foregoing remarks apply with force to them. Perhaps, however,
it must be admitted that there is difficulty in reconciling all the decisions
in the Quebec courts.
Under these circumstances I think the matter must be treated as
one that, in view of its importance, has not yet been sufficiently discussed
and, at any rate, not conclusively decided. I
think on all grounds it is open to this court to give a clear and final
decision upon this point.
Since for the above reasons I consider that the
appellant was not qualified to bring suit I
express no opinion upon the merits of the questions raised in the suit.
The appeal is dismissed with costs.
Idington J. (dissenting).—The respondent, the City of Montreal, a municipal
corporation, entered into a contract with the other respondent whereby an
exclusive franchise was attempted to be given the latter to establish and
operate lines of autobusses to be operated over certain streets of said city in
the way of carrying passengers for hire for the period of ten years.
The contract rests upon a by-law of the city,
which it is said delegates the power to the city council to enter by way of
resolution into such a contract, and upon such a resolution passed by the said
council.
[Page 39]
The contract is dated 22nd August, 1912, and is
expressly made in virtue of the authority conferred upon the city hy 2 Geo. V.,
ch. 56, sec. 12, sub-sec. 137, as well as all the municipal regulations of said
city which can relate to the exploitation of autobus lines of the company.
The appellant is a ratepayer of the city and
claims that the whole proceeding is illegal.
The questions thus raised must be determined by
the consideration of a few sections of the city charter as amended by some of
the numerous amendments that exist and of a few elementary principles of
municipal law.
The amending sub-section 137, being that alone
upon which the parties could have proceeded and must have supposed their
proceedings rested, is as follows:—
137. To permit, under such conditions and
restrictions as the city may impose, the circulation of autobusses and the
establishment, maintenance and operation of autobus lines in the City of
Montreal; to prescribe on which streets they may circulate and be established
and from what streets they may be excluded; subject to the provisions of arts.
1388 to 1435 of the Revised Statutes, 1909, governing motor vehicles,
respecting speed limits, the registration of vehicles and the licences of
owners and chauffeurs.
To understand this we must observe in what
connection it is used and how intended by the amendment to be applied. We find
in tracing back the matter thus that it is made supplementary to sections 299
and 300 of the charter as consolidated in A.D. 1899 by 62 Vict., ch. 58, which
enabled the city council to enact by-laws for the purposes defined and
specified.
In the schedule of subjects contained in section
299 there is specified item, No. 17, which is as follows:—
The granting of franchises and privileges
to persons or companies.
[Page 40]
Section 300, so far as bearing upon this
subject, is as follows:—
300. And the city council, for the purposes
and objects included in the foregoing article, but without limitation of its
powers and authority thereunder, as well as for the purposes and objects
detailed in the present article shall have authority: * * * 74. To regulate and
control, in a manner not contrary to any specific provisions on the subject
contained in this charter, the exercise, by any person or corporation, or any
public franchise or privilege in any of the streets or public places in the
city, whether such franchise or privilege has been granted by the city or by
the legislature.
Let us read sub-section 137, introduced and put
in Connection with the foregoing by 2 Geo. V., ch. 56, above referred to and
quoted, as if it followed this, and we see what gives it vitality, and upon and
subject to what conditions the power which it contains is given.
It is a power to enact a by-law and nothing less
and does not authorize the council to act by a mere resolution.
Surely, it is elementary that any one given a
power to do a particular thing, in a strictly specified way, must follow the
allotted path and is not at liberty to try to accomplish what he believes to be
the same result by some other method, and then claim he is exercising the
powers given.
I find, therefore, that the power given to do
that contemplated by the amendment quoted above, whatever may be the scope and
purpose thereof, must be exercised by by-law.
There was no by-law adopting the contract in
question and, hence, it cannot rest upon this amending section; for the mere
resolution of the council cannot maintain anything dependent thereupon.
It is argued that the amended powers of the
[Page 41]
commissioners enable this contract to be entered
into by a resolution of the council. Sub-section 3 of section 21, enacted by 1
Geo. V., ch. 48, as follows:—
It shall devolve upon the council, on the
commissioners’ report, to grant franchises and privileges, by by-laws,
resolutions or contracts, as the case may be; to issue debentures and to effect
loans,
is relied upon.
With great respect I cannot see how such an
interpretation can be placed upon this sub-section.
It clearly indicates that where “as the case may
be” a by-law is the appropriate method, then a by-law must be adopted, and
where a resolution is a suitable mode of executing the proposals of the
commissioners, that may be adopted.
It would surprise some people to be offered
debentures resting merely upon a resolution of the council even if the
commissioners had recommended such an issue.
Again, it has been argued that, as there may be
a general power given municipalities relative to franchises for running cars
for the conveyance of passengers, and, as clause 4650(a) and following
sections, restraining the like grants beyond ten years, unless sanctioned by a
vote of the municipal electors, use the phrase “by-law or resolution” in
dealing therewith, it may he implied first, that an exclusive franchise for the
ten years can be granted and that when the term of any such contract is less
than ten years, then the use of a resolution may be resorted to.
Such far-fetched reason for resting an
implication of any kind upon hardly deserves serious consideration in relation to
the matter now in hand.
These general provisions are intended to be
comprehensive and to cover not only the actual, but also
[Page 42]
the possible by virtue of any existing, or by
way of anticipation of any future regulation, enabling the use of either by-law
or resolution in the cases referred to. How can the suggested implication rest
thereupon unless and until legislative authority had been given to use
resolutions as such basis of action?
Moreover, I venture to think that a municipal
corporation bas only such powers as are expressly given it by statute or as may
arise from the necessary implication involved in the obligation to discharge
some statutory duty imposed upon the corporation. And in the discharge of any
such duty the usual methods appropriate to the execution of such business must
be adopted.
When such corporations find they cannot, by
acting within these limitations, efficiently promote the supposed purposes had
in view in their creation, they usually apply to their legislative creators to
confer further powers.
Such, I take it, was the origin of the amendment
above quoted and relied upon. It never was, I imagine, supposed that there
existed any such implication till the hard exigencies of arguing to maintain
this contract suggested a resort thereto.
Starting out in any direction to solve the
problems involved herein we are always driven back to the realization of the
hard legal facts that the only semblance of power ever given in relation
thereto was to enact a by-law relative to
the circulation of autobusses and the
establishment, maintenance and operation of autobus lines in the City of
Montreal.
And this has not been adhered to.
Again, the contract proposed was to constitute
an exclusion of others than the respondent company from
[Page 43]
operating upon the streets selected. No such
power is given in this section or elsewhere.
To begin with the streets are open to use by
everyone for travelling over with suitable vehicles and whether carrying either
passengers or freight for hire, or only for private business or comfort. An
express enactment is required to take away any part of this public right.
In the next place the mere regulation of the
traffic on the streets which is vested by the charter of the city in its
authorities seems to have been the purpose of, and at least is clearly the
nature of, what this amendment is provided for, and it cannot he extended by
by-law, or otherwise, to the creation of an exclusive right in any man or firm
or corporation to use the streets for any specific purpose. All must be treated
alike unless by virtue of some express legislation taking away such right.
The section enables the council to prescribe the
streets on which autobus lines may circulate, but does not enable the
preference of one line over another.
I think it may be well, respectfully, to point
out that those depending upon the argument of implication in legislation, would
do well to consider the chapters in Hardcastle on Statutes dealing with
implications and enabling statutes, and the many authorities collected therein.
The respondent being a ratepayer and constituted
by the city charter a member of the corporation is entitled to take this
action. It is one sort of security the law gives (as it does to each member of
a corporate body) for keeping the municipal authorities in their acts
[Page 44]
within the limitations of the law, or often
municipal government would be quite intolerable.
The statute gives, it is true, a summary method
for attacking by-laws, but that is not inconsistent with the right each member
of a corporate body has by law. And the provision does not purport to exclude
any other remedy, though giving a summary method.
The appeal should be allowed with costs
throughout, the contract declared illegal and void, and the by-law and resolution
also, so far as designed and, if possibly valid, capable of being applied to
support such a contract.
There are a number of the paragraphs in the
bylaw which are general and in themselves complete and inoffensive as they
trench upon no man’s right.
I had written the foregoing opinion before the
re-argument, which recently took place, touching the right of the appellant to
institute such proceedings as presented herein, was directed.
That right of appellant must depend upon whether
or not he falls within article 77 of the Code of Civil Procedure for Quebec,
which is as follows:—
77. No person can bring an action at law
unless he has an interest therein.
Such interest, except where it is otherwise
provided, may be merely eventual.
The new part indicates (whatever else it may
have been intended for) as fairly arguable the proposition that the
shareholders of the Montreal Tramways Company having an eventual interest in
the decision of such a question as agitated herein, may be qualified to sue.
The value of the interest is immaterial. It might happen to be, in any case,
either that of the
[Page 45]
owners of almost the entire shareholding
property, or of only a single share.
The probably tenable answer is that generally
speaking the shareholders are not as such entitled to apply to the courts
unless and until shewing that by reason of the existing conditions of the
company or its directorate, who should act but will not, there is no means left
to any number of shareholders to obtain justice, or that the company is doing,
or attempting to do, that which is ultra vires.
That brings the matter back to the other ground
taken in this action by the appellant as an inhabitant and ratepayer, in other
words as a corporator, that the contract he attacks is ultra vires of
the corporation of which he is a member and that in having it so declared he
has an interest entitling him to sue. English practice might suggest or
require the suit to be on behalf of all the ratepayers. Passing that minor
point not raised in argument, I return to the proposition just enunciated,
which I maintained in what I have already written, and still maintain (more
confidently) as result of the re-argument,
“The inhabitants and ratepayers of the City of
Montreal and their successors” were, by section 4 of the charter, incorporated.
The charter, by section 304, specifically
recognizes a ratepayer as having the right to apply to the Superior Court to
annul any by-law. And a similar provision is made in the “Cities and Towns
Act,” para. 5623 of the Revised Statutes of Quebec, and article 698 of the
Municipal Code.
All these provisions indicate that the
legislature considered ratepayers to be in fact persons interested.
I think these enactments merely provide a
summary
[Page 46]
remedy by petition, in addition to such remedies
as already were existent, for the enforcement of the legal right thus,
apparently as matter of course, assumed to exist and to be grounded upon
obvious interest.
And the almost entire abstention on the part of
the Attorney-General from interference in such matters would seem to indicate
that reliance is not to be placed as in England upon such officer, but upon the
vigilance of the ratepayers for the purpose of protecting the members of
municipal corporations against attempts on the part of those in authority to
act ultra vires.
Then why should we assume under such a condition
of things that an article of faith, as it were, which anciently existed in
England must prevail in Quebec?
Surely in the absence of English faith and
practice there, and where reason alone is our guide, it is expressive of our
common sense to hold that every “inhabitant and ratepayer” has a direct
interest in keeping his municipal rulers within their legal boundaries. It is
not a question of every such man having a right to interfere with the acts of
the class of men whom the legislature has designated, and from whom the people
have chosen those to transact the business of the corporation. It is simply the
question of restraining such men from misrepresenting those who put them there
going beyond the line of their authority that is now in question.
Why, for example, should shareholders of a
corporate company impliedly have this right and it be denied to the municipal
corporator?
Why should a shareholder be told, as he was by
[Page 47]
Bacon V.C. in Hope v. The
International Financial Society,
at page 332:—
But he is a shareholder also, and, as a
shareholder, it is his right, and it is also his duty, to see that the moneys
of the company are applied to their legitimate purpose.
This seems to me sound law and sense and so was
upheld in appeal. The plaintiff there had an interest as a creditor, but that
was expressly discarded. The case is cited in Buckley on Companies, etc. (9
ed.), at page 613, where the legal distinctions applicable to cases in which a
shareholder may, and those in which he may not, have a right to invoke the
action of the courts to control a company, are dealt with.
Or take the doctrine as laid down by Sir George
Jessell in Russell v. Wakefield Waterworks Co., at pages 479 and 480, and
especially foot of latter page, when quoting with approbation the language of
Sir J. Wigram in Foss v. Harbottle,
where he ends by attributing to Lord Cottenham the saying that
the claims of justice would be found
superior to any difficulties arising out of technical rules respecting the mode
in which corporations are required to sue.
What is dealt with there is not exactly what we
have to deal with here, but the mode of thought and speech touches what may
well have been had in mind by those amending the article 77 of the Code of
Civil Procedure already quoted.
It all comes back to what that article covers
and enables or impliedly denies.
If the attitude taken in England towards the
supposed needs of resorting to the Attorney-General as
[Page 48]
sole repository of the right and duty to invoke
the powers of the court to restrain corporations from transgressing the limits
of their powers, has been correctly reflected in these dicta as what obtained
half a century ago, can we rely much upon the merely technical doctrine
transmitted thence as a guide to interpret said article 77?
The Attorney-General of Quebec has, by article
978 of the Code of Civil Procedure, imposed upon him the respective duties,
therein expressed, either absolutely or conditionally, as the case may be. Does
that take away from the interest, right or duty of the “inhabitant and
ratepayer”?
I do not find therein any such necessary
implication.
Then in articles 713, 714, 715, and 716 of the
Revised Statutes of Quebec, 1909, there is defined his legal functions, duties
and powers.
Amongst these article 716 gives him the
functions and powers which belong to the office of Attorney-General and
Solicitor-General of England, in so far as the same are applicable to this
province, etc.
When we fail to find an active use of such
powers in relation to such subject matters, should we not conclude that the
same have not been found in that respect applicable to the province?
If he is supposed to act only upon the application
of some one indemnifying against costs under article 978, then who has the
right to so demand?
If the ratepayer or inhabitant has no interest,
how can he demand such action? It seems over refinement to say he has an
interest which entitles him to set the law in motion, yet no interest entitling
him to sue.
[Page 49]
Let us turn to article 50 of the Code of Civil
Procedure, which reads as follows:—
50. Excepting the Court of King’s Bench,
all courts, circuit judges and magistrates, and all other persons and bodies
politic and corporate, within the province, are subject to the superintending
and reforming power, order and control of the Superior Court and of the judges
thereof in such manner and form as by law provided.
Who is to move the court to invoke the exercise
of this visitorial power? If intended to limit it to those moving by and
through the Attorney-General, the article likely would have said so. We do know
that such has not been the interpretation given it in many cases. Even before
this legislation the power was exercised apparently as if inherent in the
court, though not as accurately defined.
The courts have continually acted upon the
application of those interested and the only difference of opinion has been as
to the interest a ratepayer, merely as such, may have. We find many cases in
which the objection has been taken that he applying had no interest, and that
often answered by shewing he had some possible financial interest more or less
remote. From this counsel for the company seems to ask us to infer those cases
are the limit. I fail to find in the very numerous cases of that sort any such
doctrine as he argues for to be necessarily implied.
I do find, however, something to warrant the
inference that a confusion of thought has often existed in the minds of those
pressing such objections, between the right of a member of the corporation to
restrain it acting ultra vires and that of a member of the general
public in such cases as arise out of what is intra vires the municipal
authority.
[Page 50]
For example, some obstruction may exist on a
highway, obnoxious to the safety or general sense of propriety, and a member of
the public may complain. Unless, however, he is able to shew he suffers
particularly beyond the rest of the public same injury therefrom, he is held
not entitled to bring a suit therefor. The subject is within the administrative
powers of the municipal authorities. No private right is invaded is the answer
to the action. I do not think the cases are at all analogous in law.
We find, however, a line of cases where the
suitor had obviously no interest but that of a ratepayer or other member of the
corporate body.
The following cases have been cited to us by
counsel for appellant, in the recent argument, as some of those in which the
element of interest other than simply as a ratepayer or otherwise, as member of
the corporation, clearly did not exist, or was in effect eliminated, by the
view taken by the court, as to such right and interest.
The case of Allard v. La Ville de
Saint-Pierre et al.,
is one where the question arose of the right of a ratepayer to bring an action
before the Superior Court to have a by-law quashed which had been passed ultra
vires which was maintained in appeal. All the questions involved herein
relative to the right of a ratepayer to sue in the Superior Court instead of
proceeding by way of petition as an elector were dealt with therein.
Then in the case of Aubertin v. La
Ville de Maisonneuve,
it was first decided by Mr. Justice Curran that the action should be dismissed
purely on the
[Page 51]
ground that there was no right in the plaintiff
to sue in his quality of proprietor of immovables situated within the limits of
the municipality defendant; and that he did not shew any grievance not suffered
by other proprietors and electors. In appeal to the court of appeal the
judgment was reversed, the majority of the court holding distinctly that there
was error in the said holding of Mr. Justice Curran. Many cases are cited in
the notes thereto; some relevant to the point in question, others not so
relevant.
In the case of Lennon v. La Cité de Westmount, the exception was taken,
that the plaintiff should have proceeded by way of petition and it was held
that where the by-law was ultra vires the ratepayer need not proceed by
way of petition.
In the case of Corporation of Arthabasca v.
Patoine,
the right seems to have been recognized although the Chief Justice, Sir A.
Dorion, dissented from the result, holding that in that case proceedings were
not open to he taken by anybody, because it was a matter for the administration
of the municipality in which there might be a mere irregularity. He expressly
distinguishes that case from the case where the council has acted beyond its
jurisdiction and seems to have recognized that then any party injured could
proceed in virtue of the provisions of the Code, or, in certain cases, by
direct action in the ordinary form. Unfortunately the exact question of whether
the individual ratepayer would in such a case necessarily be injured, was not
by him touched upon. The case is valuable for the consideration given therein
to the general principles which ought to govern those managing
[Page 52]
municipal affairs, and govern the court in
supervising their conduct and rectifying wrong, if any.
In Guay v. The Corporation of Malbaie, the court seemed to
recognize the right of an elector or ratepayer as having sufficient interest in
certain cases.
In Jacob v. La
Cité de St. Henri,
Judge Pagnuelo clearly holds the ratepayer had sufficient interest.
The case of Tremblay v. The City of Montreal proceeds on article 304 of
the charter, but St. Pierre J. distinguishes between that which is intra
vires and that which is ultra vires, as to the extent of this
remedy.
In Trudel v. Gité de Hull, the right of a
ratepayer to have a mandamus to compel the corporation to observe the law was
clearly recognized. That case concerned the finances of the city, but turned on
the question of the plaintiff having an interest to bring the suit therefor.
The plaintiff clearly had no such right as where given expressly the power as
in the last mentioned case. Yet he was held entitled to sue. The form thereof
or kind of relief sought or got cannot affect the question of his right or
interest. If he had no interest he could not sue in any form.
The case of Farwell v. Corporation of Sherbrooke clearly lays down the law
that the ratepayer is not confined as to his right to relief to the provisions
contained in specific articles enabling him to sue, but may have a by-law
passed ultra vires quashed by taking
[Page 53]
the proceeding in an ordinary action. Many of
the leading cases in Quebec are discussed in the judgment.
I may also refer to the case of Piché v. La
Corporation de Portncuf,
where the Court of Review confirmed, for the reasons given by Routhier J.,
the judgment given by him granting relief against the action of the council in
regard to roads, where he relied upon article 2329 of Revised Statutes of
Quebec, 1888, which gives very wide powers Over all courts, magistrates and
judges, and circuit courts and corporations in the province, and now appears as
article 3085 of the Revised Statutes of Quebec, 1909.
I do not think we should discard and overrule
such a mass of authority simply because we find in some other cases a different
rule has been observed.
I have examined all such cited and many others,
for the subject is an interesting one. I think, however, when we have under
consideration any branch of the law where there has been a development,
indicating a process of discarding that which is no longer serviceable, and
substituting therefor that which tends to the furtherance of justice and
judicial control over those who are determined to exceed the limits of their
authority, we should at least lend a sympathetic ear to such decisions as tend
to aid and promote such beneficent development.
In this instance it turns upon the meaning to be
given the “interest” of him who, if he has regard to what is going on about
him, must be most deeply interested in seeing that the bounds of authority in
his local rulers are not exceeded.
It does not occur to me that the term can only
relate
[Page 54]
to financial interests. In the ultimate result,
assuredly, misgovernment always tends to affect even those interests. In this
case there are financial provisions dealt with in the contract proposed. If the
contract is ultra vires it is void and the corporation may run many
merely financial risks of which the end may be difficult to see. Is such a
thing to be tolerated?
In the case of Paterson v. Bowes, the Court of Chancery in
Upper Canada held a ratepayer entitled to sue as plaintiff therein did, and we
in this court in the case of MacIlreith v. Hart, followed that and other
like cases.
The principle involved in the latter was the ultra
vires nature of the act of payment complained of. Here it involves money
and much else that concerns the right and duty of the citizen.
There is nothing peculiar to French law in the
doctrine that a man who has no interest in the subject matter giving rise to
litigation shall have no right to bring an action. That doctrine is common to
all legal systems. It has been unduly pressed by its application to a condition
of things arising out of the development of corporate activities, both of an
industrial and municipal character.
Those fond of technicalities may approve of so
doing. Those caring less for technicalities, seeing the trend of events and
having more regard for the useful application of the principles of law than the
form or mode of such application, should find no difficulty in discovering that
he who has as the result of such development a very real interest in
restraining
[Page 55]
those he has placed in power from exceeding the
limits thereof.
Counsel for the city urged that the business of
the city would be hampered by permitting the exercise of such a right. The
contrary seems to me to be the correct way of looking at it. If the municipal
authorities keep within their powers they have nothing to fear. If they exceed
them the sooner it is so determined the better. For what is done by such excess
leads only to confusion and loss of efficiency and money.
An obiter dictum of Lord Watson in the
judgment of the Judicial Committee of the Privy Council in Déchène v. City
of Montreal,
at middle of page 642, was referred to in argument. He said there, referring to
some legislative provisions enabling any municipal elector to attack by-laws:—
They confer upon each and every municipal
elector the right, which he had not at common law, to challenge, on the score
of illegality, any corporate appropriation of money to meet the expenses of the
current year, subject to the condition that the right shall prescribe, if not
exercised within three months from the time when the appropriation comes into
force.
What he had in mind is made to appear at foot of
page 643, where he says:—
To begin with the first of these pleas, it
is true that an incompetent resolution must be illegal; but it does not follow
that an illegal resolution must be beyond the competence of the council. In
this case, the resolution sought to be impeached was plainly within their
competence, seeing that it exclusively relates to matters committed to the
council by statute. Even if it had been incompetent, that circumstance could
not enable the appellant to bring a petition for its annulment after the expiry
of the three months. After the lapse of that period, the right conferred upon a
municipal elector by 42 & 43 Vict. ch. 53, sec. 12, is at an end; though
the incompetent resolution remains open to challenge, at the instance of
persons who have a proper title.
[Page 56]
Who the persons having a proper title might be
is not stated. An elector might be a corporator or not according to the statute
incorporating.
As against this dictum we have the recent
decision (in 1915) in the case of Dundee Harbour Trustees v. Nicol and
others,
holding that appellants, who were constituted a board of trustees under the
“Dundee Harbour and Tay Ferries Consolidation Act,” 1911, to be elected in part
by the shipowners and harbour ratepayers of Dundee, were liable to be
restrained by proceedings, taken at the suit of shipowners and ratepayers, from
acting ultra vires. And the neat point was raised as to the right of
those parties to complain without the necessity of the Lord Advocate being made
a party to take the proceeding.
Lord Haldane, mindful of the analogy according
to English practice which might suggest the single shareholders’s right upon
which I have relied alone, instead
of the Attorney-General who, in a like English case might be a proper party to
so act, said:—
In England it may well be that it would be
in accordance with the usual and proper practice to invoke, in a case such as
this, the assistance of the Attorney-General, who, as representative of the
Sovereign the parens pa trice, has the capacity to interfere. But even
without invoking the Attorney-General I think it probable that, in a case such
as the present, a harbour ratepayer in the position of the respondents, whose
interest in the undertaking and funds is apparent, ought to be treated as
within the analogy of the principle which enables a single shareholder to sue
in his own name to restrain an ultra vires act.
It is not necessary to decide this question
of English law, and the judgment in the present case will leave it open; yet I
have thought it right to say what I have said in order to shew that I do not
overlook the analogy. But whatever would be the position in England, the case
for recognition of the individual title to sue of a person in the situation of
the respondents is materially
[Page 57]
stronger in Scotland, inasmuch as the Lord
Advocate does not, under the law and practice which obtain there, usually
intervene as representing the parens patrice excepting when some statute
casts on him the duty of doing so. I have come to the conclusion that the
respondents had a good title to maintain these proceedings.
Then in the same case we have (if I might be
permitted to say so) a most instructive judgment by Lord Dunedin citing many
cases and shewing the development of judicial thought in regard to the very
question we have in hand.
If the ratepayers can be upheld by the House of
Lords in maintaining such a right as involved herein in Scotland, where so much
of the mode of legal thought depends on the principles of the civil law, surety
the Province of Quebec need not dread the adoption of what, as shewn by the
cases cited above, so many of their able judges have held to be law.
In the United States opinion seems to have been
much affected by the local condition of things relative to the exercise of the
powers of supervision by the Attorney-General. Where by statute or otherwise
that officer continuously undertook to see to the enforcement of law and order,
he often was looked to as the proper party to bring the action, but in states
where that officer has ceased to act, the tendency seems to have been to hold
the ratepayer had the right, in other words, the interest, qualifying him to
act.
In the case of Crampton v. Zabriskie, at page 609, the Supreme
Court of the United States held that at that day (1879), no serious question
existed of the right.
Of course, all this is predicated upon the
hypothesis that the contract in question is ultra vires and the
[Page 58]
mode or condition of doing anything like
thereunto has not been adopted.
If I am mistaken in the opinion of its being ultra
vires, this supplementary opinion has no bearing on the appeal.
Duff J.—On the 10th of June, 1912, the council of the City of Montreal
passed a by-law containing the following provisions:—
Sec. 2. Les autobus
destinés à transporter des
“passagers” seront exclus de toutes les rues, avenues et autres voies publiques
qui ne sont pas mentionnés dans la cédule ci-annexée.
Sec. 16. Aucune personne ou compagnie ne devra faire circuler des autobus ou
établir, maintenir ou exploiter des lignes d’autobus dans la Cité de Montréal,
dans les rues mentionnées dans le présent règlement, sans avoir préalablement
obtenu un permis à cet effet de la cité.
On the 22nd of August of the same year the mayor
on behalf of the municipality made a contract with the Canadian Autobus Co.
Ltd. in pursuance of a resolution passed by the council on the 14th of the same
month, by which (inter alia) the Autobus Co. was given the right to run
autobusses for the transportation of passengers for hire on certain parts of
the public highways mentioned in these two sections. The
contract contains the following provisions:—
La Cité de Montréal s’engage durant une
période de dix années à compter de la mise en exploitation des lignes désignées
dans les articles 1, 26, et 27, du présent contrat, à n’accorder aucun
autre permis pour l’établissement, le maintien et l’exploitation de lignes
d’autobus sur ces dites lignes,
the effect of this contract, if valid, being
that for the period of ten years following “la mise en exploitation” the
Autobus Co. acquires the right to run its vehicles as above mentioned, while
the municipality disables itself from granting permits under the by-law of the
[Page 59]
10th of August to possible competitors for any
of the same routes. On the same assumption it is also probable that the council
is disabled from abrogating the regulation contained in the 16th section of the
by-law. It is not necessary, however, in the view I take, to consider that
point.
The validity of the contract is attacked upon
three grounds:—
(1) That the City of Montreal has no authority
to grant an exclusive right to run autobusses in the city streets.
(2) That assuming such a power to be vested in
the municipality it is a power which can only be exercised under the authority
of a by-law and admittedly no by-law was passed authorizing the contract of the
24th of August.
(3) That the contract provides for a transfer to
the municipality of shares in the Autobus Co., and the taking shares in such a
company is ultra vires of the municipality.
The first ground raises, among others, the
important question of how far the council can by contract bind its successors
in respect of regulating the use of the city streets; Ayr Harbour Trustees v.
Oswald;
Staffordshire and Worcestershire Canal Proprietors v. Proprietors of
Birmingham Canal,
but I think the appellant has no title to impeach the resolution of the council
or the contract upon either the first or the second of these grounds. I shall
state my reasons for this as briefly as possible, but a summary reference is
unavoidable to the powers and authorities
[Page 60]
with which the municipal corporation of the City
of Montreal is invested by its present charter—of the year 1899 (62 Vict., ch.
58). By section 4 it is provided (inter alia) that the inhabitants and
ratepayers of the City of Montreal and their successors shall continue to be a
municipal corporation under the name of the City of Montreal,
and as such shall have * * * all the
powers of legislation control and administration commonly possessed by
municipal corporations and in addition thereto all the powers specially granted
to the said city by-law and by the provisions of this Act.
The description of these “powers of legislation”
and “control,” in so far as they are material for the present purpose is found
in sections 299 and 300 of the charter and in an enactment, passed in 2 Geo.
V., and specially referred to in the contract by section 12, sub-sec. 137, ch.
56, of the statutes of that year. Section 299 of the charter which is the
general provision on the subject of “powers of legislation” had better be
quoted substantially in full, and is as follows:—
299. It shall be lawful for the city
council to enact, repeal or amend, and enforce by-laws for the peace, order,
good government and general welfare of the City of Montreal, and for all
matters and things whatsoever that concern and effect, or that may hereafter
concern and effect the City of Montreal as a city and body politic and
corporate, provided always that such by-laws be not repugnant to the laws of
this province or of Canada, nor contrary to any special provisions of this
charter.
And for greater certainty, but not so as to
restrict the scope of the foregoing provision or of any power otherwise
conferred by this charter, nor to exceed the provisos herein above mentioned,
it is hereby declared that the authority and jurisdiction of the said city
council extends, and shall hereafter extend to all matters coming within and
affecting or affected by the classes of subjects next hereinafter mentioned,
that is to say:—
3. Streets, lanes, and highways, and the
right of passage above, across, along or beneath the same;
6. Licenses for trading and peddling;
[Page 61]
8. Health and sanitation;
12. Nuisances;
14. Decency and good morals;
17. The granting of franchises and
privileges to persons or companies.
The provisions of section 300 are more specific;
sub-sections 1, 29, and 74 have some bearing upon the question before us. They
are as follows:—
300. And the city council, for the purposes
and objects included in the foregoing article, but without limitation of its
powers and authority thereunder, as well as for the purposes and objects
detailed in the present article, shall have authority:—
1. To regulate the use of and prevent and
remove encroachments into, upon or over streets, alleys, avenues, public
grounds and public places, municipal streams and waters, and to prevent injury
thereto and prohibit the improper use thereof;
29. To license and regulate hackmen,
draymen, expressmen, porters, and all other persons or corporations, including
street railway companies, engaged in carrying passengers, baggage or freight in
the city, and to regulate their charges therefor, and to prescribe standing
places or stations within the streets or near railway stations, where the same
may remain while waiting for business, and to prohibit the same from standing
or waiting at any other places than the places so prescribed;
74. To regulate and control, in a manner
not contrary to any specific provisions on the subject contained in this
charter, the exercise, by any person or corporation, of any public franchise or
privilege in any of the streets or public places in the city, whether such
franchise or privilege has been granted by the city or by the Legislature.
The statute of 2 Geo. V. is in these terms:—
137. To permit under such conditions and
restrictions as the city may impose, the circulation of autobusses and the
establishment, maintenance and operation of autobus lines in the City of
Montreal; to prescribe on which streets they may circulate and be established
and from what streets they may be excluded; subject to the provisions of arts.
1388 to 1435 of the Revised Statutes, 1909, governing motor vehicles,
respecting speed limits, the registration of vehicles and the licences of
owners and chauffeurs.
It is evident that in passing the by-law of the
10th of June and the resolution of the 14th of August the council was
attempting to exercise one or more of the
[Page 62]
“powers of legislation” and “control” described
in these enactments. The soil of highways within the municipality is declared,
it is true, by another enactment to be vested in the municipality (Municipal
Code, art. 752); but as “highways they are dedicated to a public use and the
municipality holds its title subject to the public right. The municipal council
in professing to regulate the exercise of the public right (as in prohibiting
the running of autobusses for hire without licence) is not acting as proprietor
in the administration of the private property of the corporation. In Mr.
Dicey’s phrase, it acts herein as a “subordinate law-making body” in a matter
which concerns not only the ratepayers or the inhabitants, but all persons who
as the subjects of His Majesty are primâ facie entitled to use the
highways. And the “law-making” function it thus exercises may be assumed to
have been committed to it in the interests of the whole public understood in
that sense.
I have been unable to convince myself that,
apart from special enactment, the relation between the municipality and a
ratepayer or an inhabitant as such imports in itself the possession by each of
them of an “interest” within the meaning of article 77, Code of Civil Procedure,
entitling each of them as an individual to call the council of the municipality
to account in a court of law for excess or abuse of authority in the exercise
or professed exercise of functions of this description.
Although the phrase has perhaps countenance from
the highest judicial authority (see Bowes v. City of Toronto, at p. 524), it is only in
a broad sense that
[Page 63]
a municipal council exercising such powers can
be said to act as “trustee” for the inhabitants or for the ratepayers as individuals.
Between them as individuals, and the council, there is no fiduciary relation in
the legal sense; but it is urged that since the inhabitants and ratepayers are
constituted the Corporation of the City of Montreal by section 4 of the charter
the law confers upon each of them a status to maintain such an action as this
as a member of the corporation and the analogy of the shareholder in a joint
stock company and his right to attack ultra vires acts of the
corporation is invoked. J think that is straining the analogy. The governing
body of a municipal corporation exercising law-making powers affecting the
rights of all His Majesty’s subjects presents a very different hypothesis from
a corporation administering private property only. For excess of power in the
first case (which is a wrong against the corporation or against the public as a
whole) the appropriate remedy seems to be by way of some proceeding at the
instance either of the corporation itself or of an authority representing the
public. The law of Quebec provides the machinery. Article 978, C.P.Q.
What I have said has, of course, no necessary
bearing upon any right a ratepayer might be supposed to have to impeach
proceedings of the council to impose a tax or rate exigible from such
ratepayer.
The decisions relied upon give little help to
the appellant. The ratio of Dundee Trustees v. Nicols is stated in this passage
of the judgment of Lord Dunedin, at pages 568 and 569:—
I now turn to the circumstances of this
case. As I said at the outset. I do not think any general pronouncement can be
made as to
[Page 64]
when there is title and when there is not.
But when I find that the respondents in the capacity of harbour ratepayers
are members of the constituency erected by the Act of Parliament to elect the
trustees, and as such, are also persons for whose benefit the harbour is
kept up, I cannot doubt that they have a title to prevent an ultra vires
act of the appellants, which ultra vires act directly affects the
property under their care. It is not only that loss of that property
through improper acting may have the effect of imposing heavier rates on the
respondents in the future, but, in the words of Lord Johnston in the Stirling
County Council Case,
at p. 1293, as they have contributed to the funds which bought the
property, “they have an interest in the administration of a * * * fund to which
they have contributed,” and a title flowing from that position and interest.
This passage, of course, has no application to
the present case. The Lord Chancellor, at page 558, suggests an analogy between
the ratepayers whose rights were being considered and that of a shareholder in
a joint stock company under the English law. His Lordship’s language makes it
plain that he has in mind a case where the right which is being asserted is in
the nature of a “beneficial interest in trust funds”; and I think I am not
misreading his Lordship’s judgment in interpreting it as giving no countenance
to the proposition that the analogy of the shareholder in a joint stock company
extends to a case in which the act complained of is not an act dealing with or
directly affecting corporate property, but an act done in professed exercise of
law-making powers exercisable in the interests of the public as a whole. In Bowes
v. The City of Toronto
the action in the form in which it ultimately succeeded was an action by the
municipality and the complaint was that certain city officials had made a
profit out of business transacted for the municipality and for this they were
[Page 65]
compelled to account. McIlreith v. Hart was a case of ultra
vires payments to members of the council. I concurred in the judgment of
Mr. Justice Davies, but I must admit I have always had my doubts about the
decision.
There is, moreover, the observation of Lord Watson
in Dechène v. City of Montreal,
which, as I read it, affords an argument of considerable weight in favour of
the respondents. In that case the appellant sought to attack the annual
appropriation as illegal. The charter of Montreal as it then stood (37 Vict.,
ch. 51, amended by 42 & 43 Vict, ch. 53), gave a right to any municipal
elector in his own name to impugn by-laws, resolutions and appropriations on
the ground of illegality within a delay of three months. At pages 642 and 643,
Lord Watson explicitly says for the Judicial Committee that in his view a
municipal elector, as such, would have no title to atack the resolution even if
incompetent except under the authority of this provision. The provisions of the
charter then in force in relation to the qualification of voters seem to shew
that all classes of persons qualified to vote would fall within the category of
“ratepayers” as that term is used in the charter of 1899. It would not be easy
to reconcile the positions (1) that a voter (necessarily a ratepayer) has no
status to attack even an incompetent resolution or by-law authorizing an
appropriation except by special enactment, and (2) that a ratepayer as such has
such a status even where the resolution or by-law does not directly affect the
municipal property or impose a tax or rate.
It should be noted that this observation by Lord
[Page 66]
Watson was made in 1894 and that the present
charter which is a revision and consolidation of the statutes relating to the
City of Montreal was passed five years later. A comparison of the enactment
under review by the Privy Council in 1894 in Dechène’s Case, with section 304,
which was substituted for it in the present charter, would hardly support a
suggestion that the law as stated by Lord Watson had been intentionally
changed. There is, therefore, some ground for saying that, having regard to the
course of legislation and the discussion in the judgment referred to, section
304 ought not to be read as a regulation or a limitation of an existing right,
but as conferring a new right which would not otherwise have existed even as
regards incompetent resolutions dealing directly with corporate property.
As to the second ground, namely, that the
council proceeded by resolution and not by by-law. If a bylaw was strictly
required, the objection, assuming as it does the power to act by by-law, must,
I think, be rejected on the additional ground that as the council may be
assumed to have been ready to pass a by-law had they been advised that a by-law
was necessary, and as the corporation itself as represented by the council
stands by the resolution and the contract entered into pursuant to it the
nature of the procedure followed by the council is not a matter in which the
courts ought to interfere at the suit of an individual ratepayer. The
resolution on this same assumption is not ultra vires in the sense of
the rule which enables an individual shareholder to attack the ultra vires acts
of a joint stock company. If the analogy of the
[Page 67]
shareholder is to be appealed to I can see no
good reason why the principle of Foss v. Harbottle should not be put into
effect.
I have had more difficulty with the third ground
of objection, but I have come to the conclusion that, assuming the transaction
otherwise competent, section 4 read together with these words of section 299,
namely:—
It shall be lawful to enact by-laws for all
matters and things whatsoever that concern and effect or that may hereafter
concern and effect the City of Montreal as a body politic and corporate
and with the statute of 2 Geo. V., are
sufficient to invest the municipality with authority to take shares in such a
company as that in question here which are fully paid up and in respect of
which the municipality can incur no liability on account of the conduct of the
company’s affairs. If it be said there is no by-law then that objection has
just been answered. I reserve my opinion on the question whether assuming the
taking of such shares to be ultra vires, the transaction would on that
ground be open to attack at the instance of a ratepayer after the expiration of
the delay prescribed by section 304.
Anglin J. (dissenting).—I am, with great respect, of the opinion that this
appeal must be allowed.
Under the alleged authority of a by-law and of a
subsequent resolution of its council, the corporation of the City of Montreal
entered into a contract purporting to give to its co-defendant the Canadian
Autobus Company, Ltd., an exclusive privilege to operate lines of autobusses on
certain named streets in the
[Page 68]
city. The by-law prohibited the operation of
lines of autobusses on any other of the city’s streets on the ground that they
were not suitable for such traffic. The effect, if the contract were valid,
would be to confer a monopoly upon the respondent company.
The appellant, a ratepayer of the city, attacks
the by-law, resolution and contract on the grounds that
(1) The defendant corporation has not the power
to grant such an exclusive privilege;
(2) If the defendant corporation has that power,
it can only be exercised by by-law;
(3) The by-law in question does not purport to
authorize a contract conferring such an exclusive privilege.
The status of the plaintiff to maintain this
action as a ratepayer has been the subject of much controversy. The numerous
authorities cited to us indicate some uncertainty on this question in the
jurisprudence of Quebec. The proceedings of the municipal corporation are
attacked in the present action not merely as being illegal, but as beyond its
competence. I do not think that section 304 of the city charter (62 Vict., ch.
58), excludes any common law right of action which a ratepayer may have to
prevent abuse of its powers by the municipal corporation of Montreal. (Compare
42 & 43 Vict, ch. 53, sec. 12; and see Dechène v. City of
Montreal;
Comté d’Athabasca v. Patoine;
Coriveau v. St. Valier;
Aubertin v. Ville de Maisonneuve;
Lennon v. Cité de Westmount;
and Farwell v. Corporation of Sherbrooke.) The weight of authority
seems to
[Page 69]
me rather to favour the view that the
ratepayer’s interest is sufficient under article 77, C.P.Q.; Allard v. Ville
de Saint-Pierre;
Tremblay v. City of Montreal;
Quay v. Corporation of Malbaie;
Jacob v. Cité de St. Henri; and Trudel v. Gift
of Hull.
No doubt there are not a few cases in which the contrary opinion has been
expressed. Although the contract in question does not involve a direct
expenditure of municipal funds, it deals with and ties up municipal property
and the control of the city streets in a manner that may result in serious loss
of revenue to the municipality in future years, and may thus materially affect
to their detriment the interests of the ratepayers in the finances of the city.
The case would, therefore, seem to fall within the ratio of the judgment in Paterson
v. Bowes,
and of the decision of this court in MacIlreith v. Hart, as stated in the judgment
of Maclennan J.A., concurred in by my Lord, the Chief Justice, although it
would have been more clearly within these authorities had the plaintiff sued on
behalf of himself and all the other ratepayers and inhabitants of the city.
See, too, Black v. Ellis.
But this objection to the form of action was not taken in the courts below or
at bar in this court and should not at this stage be allowed to defeat the plaintiff’s
claim. I express this opinion in favour of the plaintiff’s status with some
hesitation induced by respect for my learned colleagues from the Province of
Quebec, who hold the contrary view. I should, however, deem it a misfortune if
such an
[Page 70]
action as this could not be maintained by a
ratepayer. Having regard to the many difficulties in the way of securing
intervention by Attorneys-General, a very useful, if not in many instances, the
only practical safeguard- in this country against improper exercise of their
powers by municipal corporations would be taken away.
A careful examination of the provisions of the
charter of Montreal has not disclosed to me anything in them which empowers the
municipal council to confer such an exclusive privilege as that here in
question. In this country the power to grant exclusive privileges on its public
streets does not exist in a municipal corporation unless it is conferred by
legislative authority, either expressly, or by necessary implication. Dillon on
Municipal Corporations (5 ed.), pars. 1215-8, 1234, 1308; 28 Cyc. 874; see,
also, Ottawa Electric
Co. v. Hull Electric Co.. This restriction is due to
the public interest in the user of the streets and exists whether the ownership
of the land they occupy is vested in the Crown, the riparian proprietors, or
the municipality itself.
The subject of the
licensing of autobus lines (art. 300, sub-sec. 137) and the granting of
franchises and privileges (art. 299, item No. 17) having been expressly
provided for in the charter of the City of Montreal, I rather incline to the
view that art. 4650 (a) of
the Revised Statutes of Quebec (7 Edw. VII., ch. 48), relied on by the respondents, is not applicable to such
matters in that municipality. But, if it is, I fail to find in its terms
warrant for the implication that
the municipal corporation has the power to grant
[Page 71]
an exclusive privilege such as that under
consideration, assuming it to be, as I think it may be deemed (at res magis
valeat quam pereat), limited in duration to ten years notwithstanding the
provisions of the seventeenth clause of the contract and their apparent
conflict with the first clause.
By sub-section 137 of article 300 of the
charter, the municipal council is empowered to license and regulate autobus
traffic in the streets of the city. The impeached by-law was passed under that
provision as appears upon its face. The by-law is general in its provisions.
It provides for the licensing and regulating of autobus lines. Nothing in it
purports to authorize the granting of any exclusive privilege. The subsequent
resolution approving of the contract made between the respondents, in so far as
that contract purports to hind the municipal corporation not to grant autobus
privileges to any other autobus proprietor, is not based upon and cannot be
supported by the by-law. Having regard to the provisions of articles 299 and
300 of the chapter, I have no doubt that, if the municipal corporation had
power to grant such an exclusive privilege as the contract in question purports
to confer, it could exercise that power only by by-law. There is nothing in the
statutory provisions creating the Board of Control and defining its powers
which dispenses with the necessity of a by-law in such a case. On the contrary,
as I read those provisions, by article 21 of the Act of 62 Vict., ch. 51, as
replaced by the statute 1 Geo. V., ch. 48, the requirement of a by-law in such
a case is expressly continued.
It follows that, in my opinion, although the
by-law is unobjectionable, the subsequent resolution authorizing
[Page 72]
the contract in question and that contract
itself are ultra vires of the defendant corporation and should be set
aside and vacated.
The appellant is entitled to his costs
throughout.
Brodeur J.—Deux
questions se présentent dans cette cause-ci: la première est de savoir si le demandeur a
un intérêt suffisant pour lui permettre d’instituer la présente poursuite; et par la seconde on soulève la validité de
certaines ordonnances municipales et d’un certain contrat.
La conclusion à laquelle j’en suis venu sur la
première question, c’est-à-dire sur le droit de poursuite du demandeur, me
dispense de discuter la seconde.
Le demandeur veut faire annuler par action directe:
1°. Un règlement de la cité
de Montréal permettant la circulation des autobus;
2°. La résolution qui
déterminait les conditions auxquelles
la compagnie intimée pouvait s’établir à Montréal;
3°. Le contrat fait entre
la cité et cette compagnie en exécution de ce règlement et de cette résolution.
La cité de Montréal est régie par une loi spéciale
adoptée en 1899 (62 Vict. ch. 58).
En vertu de cette loi (article 304) les règlements municipaux peuvent être
attaqués par un contribuable par voie de requête qui devra être présentée à la
Cour Supérieure dans les trois mois de leur mise en vigueur.
Il n’y est dit nulle part que les résolutions du
conseil municipal ou que les contrats exécutés par la corporation peuvent être
attaqués par un contribuable.
[Page 73]
Dans la cause actuelle le demandeur aurait pu procéder
par la voie expéditive de la requête en cassation (motion to quash); mais il a
préféré avoir recours à l’action directe afin de contester en même temps la
résolution et le contrat.
Je considère qu’il n’a pas prouvé avoir un intérêt
suffisant pour lui permettre de réus.sir dans sa poursuite.
Il ne démontre pas qu’il soit personnellement
affecté par le règlement, la résolution ou le contrat en question.
Il avait d’abord allégué qu’il était actionnaire
dans une compagnie rivale de celle qui a eu le privilège de faire circuler ses
autobus mais lors de l’audition devant nous il a abandonné ce point.
Son intérêt est celui de tous les contribuables de
la municipalité.
Cette question d’intérêt a fait l’objet de
plusieurs décisions.
Nous avons d’abord le Conseil Privé qui, dans les
causes de Brown v. Gugy,
et de Bell v. Cité de Quebec,
a décidé que le droit d’un propriétaire riverain de poursuivre pour des
obstructions placées dans une rivière ne pourrait être exercé qu’au cas où il
souffrirait des dommages spéciaux.
Il est bien vrai qu’il ne s’agissait pas d’une
affaire municipale; mais la distinction est tout de même faite entre l’intérêt
personel et l’intérêt général.
En 1879, dans une cause de Bourdon v. Benard, la cour d’appel a déclaré
que le droit de faire disparaître des obstructions et empiétements sur les
[Page 74]
chemins appartient exclusivement aux municipalités
et que les particuliers ne possèdent pas ce droit d’action à moins qu’il ne
leur en résulte des dommages réels et spéciaux.
In 1892, 1893 et 1894, le même principle a été suivi par l’Honorable juge
Doherty, aujourd’hui ministre de la justice, dans les causes de Sénécal v.
Edison Electric Go.,
et de Bélair v. Maisonneuve, et par l’honorable juge-en-chef suppléant Archibald dans la cause de Bird v. Merchants Telephone Co..
En 1907, la Cour de Revision, composée
des Honorables juges Tellier, Lafontaine et. Hutchison,
a confirmé le jugement de l’Honorable juge Mathieu dans la
cause de Emard v. Village du Boulevard St. Paul, qui avait décidé que
l’action en nullité d’une résolution du conseil municipal ne peut être intentée
trente jours après la mise en force de cette résolution que par un contribuable
ayant un intérêt direct et spécial.
En 1909, dans la cause de Allard v. Ville de Saint Pierre, quatre honorables juges de
la Cour Supérieure se sont également divisés sur cette question, la majorité de
la Cour de Revision étant
d’opinion que tout contribuable peut demander par action directe la cassation
d’un règlement ultra vires nonobstant le recours spécial par voie de
requête prévu dans l’acte.
Dans une cause de Aubertin v. La ville de
Maisonneuve, décidé en 1905, les juges se sont aussi là également, divisés sur la question de savoir
si l’action directe pouvait être exercée par un contribuable qui n’avait pas
d’intérêt spécial.
[Page 75]
Enfin dans la cause actuelle l’hon. juge Lavergne,
qui a rendu le jugement de la cour, dit dans ses notes que—
Robertson ne pouvait faire maintenir son
action sans démontrer un préjudice personnel et spécial. Les moyens de nullité
au d’illégalité qu’il pourrait peut-être faire valoir comme requérant ne
peuvent être invoqués par lui dans une instance ordinaire où il se porte
demandeur.
La jurisprudence des cours provinciales dans ces dernières années est donc assez
incertaine.
Les décisions du Conseil Privé, que j’ai
mentionnées plus haut, et de la cour d’appel dans la cause de Bourdon v.
Benard, démontrent clairement que les droits d’un
particulier de poursuivre n’existent en vertu de la loi que s’il est personnellement
et directement intéressé.
C’est la principe suivi en France et je relève
da,ns Dalloz, Répertoire Pratique, les passages suivants: Vo. action
No. 39. C’est un principe fondamental qu’on ne peut exercer une action qu’en
autant qu’on y a intérêt. * * * L’absence
d’intérêt exclut la recevabilité de l’action.
Vo, Commune,
No. 505. Pendant longtemps le Conseil d’Etat a décidé en termes généraux qu’un
contribuable n’a pas en l’absence de tout intérêt direct et personnel qualité
pour demander au préfet de déclarer la nullité d’une délibération.
Dalloz, 1887-3-72; Dalloz, 1889-3-68; Dalloz,
1892-5-128; Dalloz, 1902-3-33.
Mais des arrêts plus récents ont décidé qu’un
contribuable d’une commune a intérêt en cette qualité de faire déclarer la
nullité d’une délibération par laquelle le conseil a inscrit une dépense au
budget de la commune.
Je comprends la raison de ces arrêts récents dont
parle Dalloz. Le contribuable a un intérêt personnel à ce que le budget d’une
municipalité ne soit pas illégalement
[Page 76]
augmenté parce qu’alors il sera appelé à payer un
plus fort montant de taxes.
Au No. 506 Dalloz, vo. Commune, ajoute qu’:—
Un contribuable n’est pas recevable à demander
que les délibérations relatives à l’érection d’une statue et à la dénomination
d’une rue soient déclarées nulles alors qu’il ne justifie d’aucun intérêt
personnel et que les délibérations attaquées n’engagent pas les finances
municipales.
Le droit pour un contribuable de demander
l’annulation d’ordonnances municipales sort des bornes ordinaires de la loi
commune.
On ne peut avoir recours aux tribunaux en principe
général que pour la conservation de nos droits personnels. Mais dans le cas
d’une demande en cassation de règlements municipaux, le contribuable exerce une
action populaire et s’il réussit ils seront cassés et annulés non-seulement
quant à lui mais aussi quant à tous les autres contribuables. On plaide alors
non-seulement pour soi-même mais aussi pour autrui. Il est d’ordre public que
ce droit de poursuite ne soit exercé que conformément aux règles prescrites par
la loi qui l’a créé.
On dira peut-être que ces restrictions pourraient
avoir pour effet de faire perdre aux tribunaux le contrôle que l’art. 50 du Code de Procédure leur donne sur les
corps municipaux.
Cette objection ne saurait être fondée car si une
corporation municipale adoptait une résolution ou’exécutait un contrat
entièrement ultra vires le contribuable pourrait alors avoir recours au
Procureur-Général sous l’article 978, C.P.Q., pour avoir un redressement de ses griefs.
Pour toutes ces raisons j’en suis venu à la
conclusion que le demandeur n’avait pas le droit dans les cir-
[Page 77]
constances de prendre une action directe. Son appel
doit être renvoyé avec dépens.
Appeal dismissed with costs.
Solicitors for the appellant: Perron,
Taschereau, Rinfret, Genest, Billette & Plimsol
Solicitors for the City of Montreal,
respondent: Laurendeau, Archambault, Lavallée, Damphousse, Jarry, Butler &
Saint-Pierre.
Solicitors for the Canadian Autohus Co.,
respondent: Bisaillon, Bisaillon & Pepin.
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