Belyea v. The King, [1932] SCR 279

Supreme Court of Canada

Belyea v. The King, [1932] S.C.R. 279

Date: 1932-02-02

Roy E. Belyea (Defendant) Appellant;

and

His Majesty The King (Prosecutor) Respondent.

Harry Weinraub (Defendant) Appellant;

and

His Majesty The King (Prosecutor) Respondent.

1931: November 17, 18, 19; 1932: February 2.

Present: Anglin C.J.C. and Rinfret, Lamont, Smith and Cannon JJ.

ON APPEAL FROM THE APPELLATE DIVISION OF THE SUPREME COURT OF ONTARIO.

Criminal law—Combine—Conspiracy—Combines Investigation Act, R.S.C., 1927, c. 26—Cr. Code, s. 498 (1) (a) (b) (d)—Sufficiency of findings to establish guilt—Findings of participation in original scheme, but not of participation in subsequent overt acts—Misdirection of himself by trial judge—Appeal by Attorney-General from acquittal at trial—Cr. Code, s. 1013 (4), as enacted in 1980, c. 11, s. 28—“Question of law”—Objection to form of indictment and conviction.

Appellants were acquitted by Wright J., [1931] O.R. 202, on charges of offences against the Combines Investigation Act, R.S.C., 1927, c. 26, and of conspiracy, in violation of s. 498, subs. 1 (a), (b) and (d), of the Cr. Code, but, upon appeal by the Attorney-General under s. 1013 (4) of the Cr. Code, as enacted in 1930, c. 11, s. 28, they were convicted by the Appellate Division, [1931] O.R. 699. They appealed.

Held: The appeals should be dismissed.

The trial judge’s material findings of fact were fully justified on the evidence and established appellants’ guilt. The trial judge misdirected himself, in that, while finding that appellants had taken an active part in the original scheme—the formation of the organizations in question which, as found, amounted to the formation of an illegal combine, and to a conspiracy within s. 498, Cr. Code—yet he acquitted them on the ground that they were not proved to have taken part in subsequent overt acts. The original scheme constituted the conspiracy

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which formed the basis for the prosecution; the overt acts were not the conspiracy, though evidence of its existence. It was not essential to a finding of appellants’ guilt, that they be held to have had actual knowledge of, or to have actually participated in, the subsequent overt acts. Once it is established that a combine or conspiracy existed, it is unnecessary, to warrant conviction for the formation of a combine, or of the agreement to conspire, to shew accused’s complicity in subsequent illegal acts done by, or with the connivance of, the body against members of which conspiracy or unlawful combine is charged; provided there is sufficient proof of their complicity in the original formation of the combine, or in the agreement charged as conspiracy.

While the Attorney-General’s right of appeal, conferred by s. 1013 (4), is confined to “questions of law,” this does not exclude the appellate court’s right, where a conclusion of mixed law and fact, such as is the accused’s guilt or innocence, depends, as in the present case, upon the legal effect of certain findings of fact made, to enquire into the soundness of that conclusion, which must be regarded as a question of law—especially where, as in this case, it is a clear result of misdirection of himself in law by the trial judge.

Held, further, that appellants’ objection to the form of the indictment, based on the ground that there were several offences charged in the alternative, and to the form of the convictions (which strictly followed the form of the indictment), could not be sustained; they expressed the offences in the very terms of the statutes. (Cr. Code, ss. 852 (3), 854, 1010 (2), cited).

APPEAL from the judgment of the Appellate Division of the Supreme Court of Ontario[1], which allowed the appeal of the Attorney-General of Ontario from the judgment of Wright J.[2] acquitting the present appellants on charges of offences against the Combines Investigation Act, R.S.C., 1927, c. 26, and of conspiracy contrary to the provisions of s. 498, subs. (1) (a), (b) and (d), of the Criminal Code. The Appellate Division set aside the acquittal of the present appellants and adjudged them guilty.

W.F. O’Connor K.C. for the appellants.

D.L. McCarthy K.C. and J.C. McRuer K.C. for the respondent.

The judgment of the court was delivered by

ANGLIN C.J.C.—These two appeals were heard together.

The appellants, Belyea and Weinraub, were both acquitted² on trial before Wright, J., without a jury, (R.S.C., 1927, ch. 26, s. 39; Cr. C., s. 581); but, upon appeal by the Attorney-General under s. 1013 (4) of the Criminal Code, as enacted by c. 11, s. 28, of the Statutes of Canada, 1930, the Appellate Division¹ was of the opinion that the

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learned trial judge had misdirected himself, in that he held that, although it was proven, if not admitted, that they (the appellants) “took an active part in the original scheme,—the conspiracy which formed the basis for the prosecution, * * * because (they) were not proved to have taken part in subsequent overt acts,” they should be acquitted, saying of one of the respondents, “There is no evidence that connects him with any of the illegal operations.” The Appellate Division found that

Belyea and Weinraub were most active in carrying out the projects of the conspiracy; were originally united with Singer himself in the conspiracy of which the latter was found guilty. They should have been convicted as were Singer, Paddon and Ward. Their part in the illegal acts was much greater than that of Paddon and Ward, but less than that of Singer.

Having found them guilty, that Court then proceeded to fine each of them one-half the amount of the fine imposed upon Singer.

After careful consideration of the evidence, of the very lengthy argument before this Court, which lasted more than two days, and of the “memorandum of points” and the supplementary factum of the appellants, we are of opinion that the appeals fail and must be dismissed.

In the course of the trial, the learned judge refused the accused leave to move to quash the indictment under s. 898 of the Cr. C., on the ground that ss. 854 and 855 applied to it, and that s. 891 of the Code was directly relevant. No motion under the latter section was made on behalf of the accused. Here, this refusal of leave, although approved by the Appellate Division, was made a substantial ground of complaint. We are of opinion that the objection is ill-founded, being based, as it was, on the ground that there were several offences charged in the alternative. As the Appellate Division said, the indictments “follow the Statutes under which they are laid, and their form is sanctioned by ss. 852, 954 (sic.) and 1010 (2) of the Code.” Having regard to ss. 852 (3), 854 and 1010 (2), the position taken by the accused is hopeless. By s. 1010 (2) it is provided that

* * * the indictment shall, after verdict, be held sufficient, if it describes the offence in the words of the statute creating the offence, or prescribing the punishment, although they (sic.) are disjunctively stated or appear to include more than one offence, or otherwise.

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Upon this statutory provision being stressed by the Court, however, counsel for the appellants sought to turn his objection into a present objection to the form of the convictions which had strictly followed the form of the indictment. It was pointed out to him that, in our opinion, it was not open for him to do so. No doubt s. 852 deals with objections to an indictment; but, as the convictions here strictly follow the form of the indictment, and express the offences of which the accused were found guilty in the very terms of the statutes, this point seems now to be concluded against the appellants. (S. 1010 (2)). As Mr. McCarthy (counsel for the Crown) put the matter to the Court, the convictions by the Appellate Division are in the words of the statutes themselves, the offences of which the accused were found guilty being the formation and operation of an illegal combine contrary to the provisions of the Combines Investigation Act, as therein defined, and conspiracy in violation of s. 498, subs. 1 (a), (b) and (d), of the Criminal Code. The words “or of services,” etc., in the indictment are introduced merely as illustrative of the methods employed by the accused in operating the combine, and in carrying out the conspiracy in question. We are, accordingly, of the opinion that any objection based on the form of the indictment, or of the convictions, cannot now be upheld.

Counsel for the appellants at the outset of the argument stated that the question he intended to raise was whether there was any evidence in the record to warrant the findings of the trial judge; and not at all as to the weight of such evidence. We are, however, of the opinion that—although, no doubt, the position so taken is sound—it is unnecessary to rely upon that as an answer to the appeal, being of the view that the weight of evidence fully justified, if, indeed, it did not require, all the material findings made by the learned trial judge.

The following findings of Wright J., in the course of his judgment, seem to us to be vital and leave no doubt as to the appellants’ guilt. Moreover, they are all supported by the evidence. Indeed, as stated by counsel for the appellant in his memorandum, the fact-finding of the learned trial judge was good.

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After setting out the indictment, and the circumstances leading up to the trial, and discussing the application for leave to move to quash the indictment, the learned judge said that, in the prosecution of this case, being the first case in the province under the Combines Investigation Act, the whole question should be fully considered. We take the following somewhat copious extracts from the judgment of the learned judge. They contain the findings which we consider material:

Prior to March, 1927, there was in existence in Ontario, an Association known as the Ontario Society of Domestic Sanitary and Heating Engineers. This Association had been somewhat dormant for years, but at a Convention held in Guelph in March, 1927, it was resolved to revive the Association with a view to extend its usefulness.

At that Convention the accused Belyea and Weinraub were elected as directors * * * Plans were then laid to hold a meeting at a subsequent date, in order to get all the allied trades into one organization. It was also suggested that a Commissioner with plenary power should be appointed as head of the organization.

Next followed a letter dated March 22, 1927, from Singer to Belyea in which suggestions were made by the former as to holding a conference to discuss the proposed new organization.

On April 9th a meeting was held in the office of Singer at which both Weinraub and Belyea were present. At this meeting it was temporarily arranged that Singer be paid $7,500 to organize and incorporate a new organization. Following this meeting a letter was written by Singer to Belyea under date of April 11, 1927, outlining the proposed objects of the organization.

Next followed a series of speaking tours throughout the Province in which Belyea and Weinraub took a leading part. This was to interest the members of the different trades affected or proposed to be affected by the formation of the new organization.

Windsor, among other centres was visited and a meeting was held of those interested at which the accused, Belyea and Weinraub, were present.

The only objection taken at bar by counsel for the appellants to the accuracy of this set of findings is that he contended that Weinraub was not present at the Windsor meeting. This, however, seems to us to be not very material.

As a result of this campaign a largely attended convention was held at Hamilton on June 11th, 1927, at which * * * it was decided to proceed to form a new association and to have a Commissioner appointed to guide and govern its affairs.

Letters of Incorporation of the Canadian Plumbing and Heating Guild were granted on June 30th, 1927.

It should here be noted that this incorporation is not an incorporation as a trade union under the Trade Unions Act.

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Prior to the granting of this charter, the sum of $7,500 was paid to Singer as his charges for his services in connection with the organization and incorporation of the Guild.

The purposes and objects of the Guild as set forth in the Letters of Incorporation did not disclose the real purposes or objects as shown by the future operations of the Guild. Two of the accused, namely, Belyea and Weinraub, were among the incorporators of this Guild.

The membership in the Guild included manufacturers and wholesalers of plumbing supplies, but shortly after the incorporation these parties became restless owing * * * to a legal opinion received by them to the effect that it was illegal for them to be in the same organization as the Master Plumbers, * * *

At a meeting held on the 24th of August, 1927, by the wholesalers and manufacturers, the following resolution was passed:

That this meeting of manufacturers and jobbers recommend to manufacturers and jobbers of plumbing and heating goods that they become members of the Dominion Chamber of Credits Limited without any further obligation than their subscription.

This incorporation was, likewise, not effected under the Trade Unions Act.

It was also arranged that the application fees already paid by manufacturers and jobbers to the Guild should be transferred to the new organization.

* * * From what appeared in the evidence at the trial, and the subsequent operations of the two organizations, it is quite clear that the new organization was formed for the purpose of having two organizations,—one consisting of Master plumbers, and the other of manufacturers and jobbers, acting under the direction of one Commissioner and in close contact and co-operation with each other.

A Convention was held at Toronto on January 26th and 27th, 1928, which was addressed by O’Connor at considerable length * * *

The only objection taken at bar to the accuracy of this finding was that Singer was not actually named as “Commissioner” for the new, or second, organization. There was, in fact, no “Commissioner” of that body; but Singer was in charge of, and responsible for, its operations throughout, and the burden of his $25,000 salary was equally borne by each body.

Shortly after this meeting, Singer conceived the idea of another organization, and on April 13th, 1928, it was arranged that a new organization to be known as the Amalgamated Builders Council should be registered under the Trade Unions Act, and the same was duly registered on the 8th day of June, 1928, with the Deputy Registrar General of Canada, as required by the Trade Unions Act. Of this organization, the accused Belyea was appointed President, and Weinraub as Secretary.

The President, on the 9th July, 1928, appointed Singer as Commissioner under rule 3 of the By-laws of the new organization.

On July 19th, 1928, Singer and O’Connor interviewed the Department of Labour at Ottawa and submitted in writing a document known

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as Canadian Cartels * * * The document is important not for that reason but for certain statements contained in the draft Cartel relating to the activities of Singer and O’Connor in connection with the formation and operation of the organization.

Certain Master Plumbers residing in Windsor * * * made application for a charter for a local section of the Amalgamated Builders Council and on September 25, 1928, a charter was granted to the branch at Windsor to be designated as Local Section No. 112. * * *

This organization continued to function until the 31st day of December, 1929, when, after an investigation under the Combines Investigation Act, the certificate of registration of the Amalgamated Builders Council was cancelled by the Secretary of State and Registrar General of Canada.

The evidence disclosed that the organizations were the creation and creatures of Singer.

His (Singer’s) was the guiding hand throughout the entire operation of the different organizations.

Under the terms of the by-law which will be referred to, he was invested with wide powers, and the evidence disclosed that he exercised them to the limit.

* * *

The Canadian Plumbing and Heating Guild was the first to be incorporated. By reference to its charter it will appear that its purposes or objects were very wide and embraced almost every conceivable subject relating to the plumbing industry.

* * *

Of these organizations Singer was the Commissioner, Belyea was President, and Weinraub was secretary. * * *

* * * The powers of the Commissioner (were) defined in clauses 2 and 3 of By-law No. 1 (of the Guild) which read as follows:

“(2) The general management shall be entrusted to a Commissioner, who shall establish and maintain the Guild and supervise and control its policies and affairs according to his best judgment, and in that behalf shall do and cause to be done such acts and things as he may from time to time think necessary or desirable and shall employ such help as he may deem necessary. He shall investigate prevailing conditions in the plumbing and heating industry and shall oversee the gathering and distribution of information. He shall examine prospective members as to their eligibility and shall admit to membership those who are eligible and shall expel from membership those who become ineligible.

“(3) The Commissioner shall have the right to veto any resolution or by-law of the Board of Directors or any decision of any officer.”

This organization had officials known as Zone Chairmen in the various centres. In Windsor, one Pragnell was the first of such Chairmen, * * *

* * * The evidence clearly established that the Windsor group was composed solely of members of the Guild and Singer, in his capacity of Commissioner, attended some of the meetings, and delivered addresses to the members. * * * It is quite clear this (Windsor) group was recognized by the chief executive officers of the Guild as a constituent though informal branch of the organization.

Next in chronological order is the Dominion Chamber of Credits, of which Singer was one of the incorporators, and one of the directors. No minutes of this organization were produced at the trial * * * The following significant clause appears among (its) objects:

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“(g) To subscribe to, become a member of, become associated and co-operate with any other association or corporation whether incorporated or not, whose objects or purposes are altogether or in part similar to those of the company and to procure from and communicate to any such corporation such information as may be likely to further the objects of the company.”

As already indicated, this organization was formed so as to permit the manufacturers and jobbers who were members of the Guild, to retain their connection with it under the guise of another body. The fees already paid by them to the Guild were to be transferred to the new organization.

The last organization to be formed was the Amalgamated Builders’ Council * * * Had it confined its operations to those authorized by (the Trade Unions) Act, no objection could well be taken, but from its operations it is clearly evident that the purpose of those responsible for its creation and operation was to avail themselves of any immunity provided by this Act, and, if possible, evade the provisions of the Combines Investigation Act, and the Criminal Code.

Counsel for the appellants fully accepted this finding at bar; indeed, he rather gloried in the attempt so made to evade the law.

Of this organization Singer was the duly appointed Commissioner. Belyea was the first president, and Weinraub was the first secretary-treasurer. * * *

At the convention of September 3rd, 1928, it was decided unanimously that henceforth only members of Amalgamated Builders’ Council actually engaged in the plumbing and heating industry should be eligible to be or to continue members of the Guild. This policy was also stated in a circular letter of September 7th, 1928, by Singer in his capacity as Commissioner, in the following words:

“No member will be admitted to Amalgamated Builders’ Council unless he is a member of the Guild. Membership in the Guild will be conditional upon membership in the Amalgamated Builders’ Council.”

Many of the foregoing findings were referred to by counsel for the appellants, in the course of the argument, as historical in their character. This, however, does not prevent them being findings of fact, fully supported by evidence, and many of them material to the existence or nonexistence of the combine or conspiracy charged.

Summarizing the essential findings of fact contained in the foregoing, they include the following:

(a) That the Canadian Plumbing and Heating Guild was formed as the result of an effort, in March, 1927, to revive a dormant body, called the Ontario Society of Domestic and Sanitary Heating Engineers, of which Belyea and Weinraub were elected as directors; the former becoming President, and the latter, Secretary-Treasurer of the new body;

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(b) That Singer was the prime mover in this and subsequent matters, being paid $7,500 by Belyea and Weinraub and their associates as a fee for the organization and incorporation of the new body known as the Canadian Plumbing and Heating Guild;

(c) That, as a result of a speaking tour, in which Belyea and Weinraub took a leading part, many Master Plumbers and others were interested in the organization, Windsor being amongst the centres visited;

(d) That Singer was appointed Commissioner of the new body in 1927, with absolute powers and to act as the alter ego of the directors;

(e) That the real purposes of the Guild were not those stated in its incorporation; and that Belyea and Weinraub were among the incorporators thereof;

(f) That the Guild membership originally included manufacturers and wholesalers as well as master plumbers; that the former became dissatisfied, and transferred their membership to another organization formed under Singer’s auspices, called the “Dominion Chamber of Credits,” of which all the wholesalers and manufacturers were urged to become members; their subscriptions being transferred from the Guild to the Dominion Chamber of Credits;

(g) That the new organization was formed for the purpose of having two organizations,—the one for master plumbers, the other for wholesalers and manufacturers, both under the full control of Singer, and acting in close co-operation one with the other;

(h) That Singer conceived the idea of a third organization, called the Amalgamated Builders’ Council, to be registered under the Trade Unions Act; of this organization Belyea was elected President and Weinraub Secretary-Treasurer. On the 9th of July, 1928, Belyea, as President, appointed Singer “Commissioner” of this third organization with plenary powers;

(i) That Singer’s was the guiding hand in all three organizations and that he was invested with the widest possible powers, which he exercised to the limit;

(j) That membership in the Guild was essential to membership in the Amalgamated Builders’ Council;

(k) That from the operations of the A.B.C. it was evident that its real purposes were to avail itself of any

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immunity provided by the Trade Unions Act, and, if possible, to evade the provisions of the Combines Investigation Act and s. 498 of the Criminal Code.

(I) That, at a Convention of the A.B.C., on September 3, 1928, it was unanimously decided that, henceforth, only members of the A.B.C. should be eligible to membership in the Guild; and membership in the A.B.C. should be conditional upon membership in the Guild;

(m) That the Windsor group was recognized by the Guild as a constituent, though informal, branch of the organization.

Having made the foregoing findings, the learned judge proceeds to sum up the situation as follows:

From the foregoing it is manifest that these three organizations were formed and operated for the express purpose of controlling the plumbing and heating industry in its various branches, including manufacturing and jobbing, and to further that end absolute control and direction of these organizations were vested in one individual styled “Commissioner,” which in itself was a vicious and indefensible system.

Except as to styling Singer “Commissioner” of the three organizations, an office actually held by him only in two of them, although, in respect to the other, the Dominion Chamber of Credits, he exercised all the powers of “Commissioner,” the accuracy of this finding as to the purposes for which the organizations were formed and operated was not challenged at bar.

The learned judge then proceeds to deal with a number of overt acts which, as Mr. McCarthy informs us, were put into the record merely to show the methods by which the conspiracy and combine was worked out, and not at all to show the existence of the conspiracy or combine, of which, he contends, there was abundant evidence apart from the proof of any such overt acts.

This finding may be regarded as a further summarizing of the nature of the purpose of the combine and conspiracy charged and found to have existed. The evidence supports it and objections, if any, taken to its accuracy would be futile.

The acts complained of in connection with the Windsor group may be summarized as follows:

(a) There was a fixing of a common price both of material and labour, as the method of computing prices of

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material was standardized and the cost of labour was fixed; and also a fixing of a rate of profit to be added to cost;

(b) That the public was forced to pay tribute to the Guild.

The learned judge proceeds:

The evidence established that at one stage of the operations of this organization schedules were adopted by the members whereby 30 per cent. was to be added to the cost of the materials for labour and to the total cost of labour and materials a further addition of 30 per cent. was to be added as profit.

There is also proof of action by the Windsor group towards creating a monopoly or limiting competition in the plumbing and heating industry.

At a meeting of Local Section 112, held on October 4, 1928, at Windsor, a resolution was adopted in the following terms:

“Resolved that the members of this Local ought not to purchase and after communication of this resolution will not purchase from any supplier who directly or indirectly sells plumbing, heating or radiation fixtures, goods, materials or systems in or about or for installation or use in or about the border cities to persons, firms or corporations other than members of this Local.”

The minutes show that the secretary-treasurer was directed to communicate the foregoing resolution to such suppliers as customarily sell within the territory of the local, and this was done accordingly.

This resolution was either drafted by Singer or submitted to him for approval, * * *

The evidence established that this resolution was acted upon in many instances and non-members of the Amalgamated Builders’ Council at Windsor found great difficulty in procuring supplies and were greatly embarrassed in their business operations.

From time to time manufacturers and wholesalers of plumbing and heating supplies were furnished with lists of members of the local Section 112 of the Amalgamated Builders’ Council and there was a tacit, if not an express agreement, that the dealers would refuse to sell to non-members and this was actually done in many instances.

* * *

In order to finance those organizations, a levy was made upon the members * * * If default was made by a member in payment of his assessment, he was liable to expulsion by the Commissioner, Singer, and this power was exercised in several instances. The resulting effect was that the expelled member was precluded from obtaining labour or supplies wherewith to carry on his operations.

These various activities built up an autocratic and despotic organization of the plumbing and heating industry in Windsor, * * *

That the learned judge had in mind the nature of the indictment to which the accused were called upon to answer is evidenced in the following reference. He says:

Section 32 of the Combines Investigation Act, (R.S.C., 1927, c. 26) declared it to be an indictable offence on the part of anyone who is a party or privy to or knowingly assists in the formation or operation of a combine within the meaning of the Act.

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He concludes by saying:

I have no hesitation in holding that the evidence in this case established that there was a combine.

* * *

The deductions I have already drawn from the evidence clearly establish that the combine in this case falls within the class indicated in this subsection (s. 2 (1)).

* * *

To come within the Statute, the combine must also be a merger, trust or monopoly so‑called, or (a) result from any actual or tacit contract, agreement, arrangement or combination which has or is designed to have the effect of any of the results set forth in subsections 1, 2, 3, 4, 5 or 6 of sec. 2.

* * *

The indictment * * * alleges that the combine resulted from an actual or tacit contract, agreement, arrangement or combination which has or is designed to have the effects set forth in subs. 1, 3, 4 and 5 of s. 2.

The evidence in my view, as already indicated, clearly establishes that there was an actual or tacit agreement, arrangement or combination, but it is still open for decision as to the actual or designed effect of such combine.

In my opinion the evidence establishes, and I so find, that the combine did have or was designed to have the following effects:

(a) limiting facilities for supplying or dealing in plumbing and heating supplies within the purview of ss. 1.

(b) fixing a common price within the meaning of ss. 2.

(c) enhancing the price or cost of articles within the meaning of ss. 4.

(d) preventing or lessening competition or substantially controlling within the City of Windsor and adjoining district the purchase, sale or supply of plumbing and heating materials.

Summarizing these findings, the result is that I hold the combine disclosed in the evidence falls within the class of combines prohibited by s. 2 of this Act.

The learned judge then proceeds to deal with the Trade Unions Act and makes the following comment (with which we fully agree):

It would be a travesty on justice if acts and transactions such as those disclosed in the evidence in this case could be justified or excused merely because the offenders were members of a Trade Union.

Taking up the conspiracy charges (counts nos. 5, 6 and 7) under clauses (a), (b) and (d) of subs. 1 of s. 498, the learned judge proceeds:

The evidence applies to these charges as well as to those already reviewed, and the findings of fact will also apply to these counts.

The evidence establishes a conspiracy to unduly limit the facilities for supplying and dealing in plumbing and heating supplies.

I need only refer to the evidence as to the arrangement restricting the sale or supply of materials to members of the organization in question, which clearly establishes an offence under this section.

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The evidence also establishes a conspiracy to unduly prevent or lessen competition in the sale or supply of plumbing and heating materials within the meaning of ss. (d) of s. 498.

I find upon the evidence that there was a conspiracy to restrain or injure trade or commerce as defined in ss. (b).

* * *

It is strenuously argued that the provisions of s. 497 apply to the situation in this case.

It was contended by counsel for the Crown, and I think properly, that the provisions of s. 497 relate only to offences charged under clause (b) of s. 498 (1).

* * *

It is quite evident that it was never intended by Parliament that s. 497 should operate as a complete defence to all the offences created by s. 498 of the Code.

* * *

Having arrived at the conclusion that offences were committed against both the Combines Investigation Act and the Criminal Code, it now becomes necessary to decide as to the complicity or participation of the accused in the offences established.

After disposing of the cases of Singer, Paddon and Ward, whom he found guilty on all the counts in the indictment, the learned judge proceeds to discuss the cases of the other accused who were before him. He says:

The case of the accused O’Connor rests upon a different basis. He was retained by Singer as his counsel and from time to time advised the latter in reference to Guild matters. He gave two written opinions * * *

* * * He also addressed a meeting of the Canadian Plumbing and Heating Guild at its annual convention at Toronto on January 25th, 1928, in which he made an attack upon The Combines Investigation Act and also on section 498 of The Criminal Code but did not directly advise evasion or disregard of the provisions of these Acts. In that address he stated, among other things, that the Commissioner Singer had explained to him his conception of the Guild and further stated he had an intimate connection with the Commissioner and had been since the birth of the Guild in daily contact with its affairs. He further stated that as the result of close scrutiny of the charter documents and actions of the Guild since incorporation, it was a lawful association, lawfully organized, lawfully conducted and that every action thereof up to that time could be shouted from the housetops without fear.

In conjunction with Singer he also appeared before the Department at Ottawa and presented a draft document known as the Canadian Cartels. In that document it was stated that Singer and O’Connor in the beginning conceived and elaborated the idea which Amalgamated Builders’ Council exemplified.

For these statements and declarations by O’Connor the Crown seek to hold him liable as a party or privy to or knowingly assisting in the formation or operation of these combines.

I am of the opinion, however, and so hold, that where the formation of an organization is for professedly legitimate objects but the organization or its members afterwards participate in unlawful operations, the party to the original formation is not criminally liable unless and until

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he participates either as party or privy to or knowingly assists in the illegal operations of the organization and I cannot find on the evidence here any participation by O’Connor in the illegal operations of these organizations or of the members of same.

In arriving at this conclusion I have in mind the provisions of s. 69 of the Criminal Code, but, notwithstanding that section, I cannot find upon the evidence that there was any participation or complicity by O’Connor in the offences established in evidence and therefore a verdict of not guilty must be found in this case.

The provision of s. 70, Cr. C., is also of value in this connection.

These findings are relevant only because they are incorporated by the learned trial judge in the part of his judgment dealing with the present appellants.

The report of the Guild Convention held on the 25th and 26th of January, 1928, was sent out by Belyea. It contained the following significant passage:

ACTING COMMISSIONER: During your Commissioner’s enforced absence through sickness, your President will, at the Commissioner’s request, act in his stead under the guidance and direction of Mr. W.F. O’Connor, K.C.

In the course of dealing with the case against the defendant W.F. O’Connor, the learned judge refers to “an organization * * * for professedly legitimate objects,” thereby implying that the actual objects of the organization, as established by the evidence, were not legitimate.

The learned judge then proceeds to deal with the cases of Belyea and Weinraub. It is true he goes on to speak of subsequent unlawful operations, to which it was necessary, in his opinion, to show that the appellants were either parties or privies, or that they knowingly assisted therein. At the very outset he makes the momentous finding that

Undoubtedly these men took an active part in the formation of the organization under review.

This very important finding may have escaped the attention of counsel because it occurs in the body of a paragraph dealing with other matters. Its significance, however, is too marked to permit of its being overlooked by us. It stands unchallenged and unmet. Presumably on the ground that the purpose of the organization was “professedly” (i.e., ostensibly) lawful, and that there is not sufficient evidence that the appellants participated in, or were privy to, the subsequent admittedly illegal acts of the Windsor group, the learned judge acquitted them.

[Page 293]

Counsel for the appellants, in his memorandum of argument, which is really a long factum of seventy-six pages, has seen fit to divide his argument under some nine heads. I have read the “factum” through and find it unnecessary to follow him in that division. In his supplementary factum (consisting of one hundred closely typewritten pages) counsel proceeds to discuss at inordinate length, though, no doubt, skilfully from his point of view, all the evidence, oral and documentary, in the record. He deals lengthily with many matters quite immaterial, his point of view apparently being that it would aid his clients if he could succeed in showing their innocence regarding matters not really vital to the charge against them; whereas, if the facts found by Wright, J., were true, and the evidence supports such findings, and those findings fairly lead to the conclusion of the guilt of the appellants, all the rest must indeed be immaterial.

In respect to the only finding of fact by Wright, J., in regard to which anything approaching error was shown to have been made by that learned judge, in his supplementary factum counsel for appellants apparently demonstrates that Wright, J., was wrong in holding that, after the institution of the Zone System, all the meetings of “the Windsor Group” were presided over by the Zone chairman.

But it will be noted that, in setting out the material findings of the trial judge above, no allusion has been made to this particular finding. That was because we regarded it as quite immaterial and beside the question. Of course, much is made by counsel for the appellants of this alleged error, but it cannot affect the issue before us, and we allude to it merely to show that the matter has not been overlooked.

Neither do we accede to the argument of counsel for the appellants that, if there be evidence that the accused were not implicated in some particular matters in which Singer or others were involved, that fact would afford an answer to the opinion of the Appellate Division that the findings of the learned judge, and facts admitted by the appellants themselves, sustain the holding

that these respondents (Belyea and Weinraub) took an active part in the original scheme,—the conspiracy which formed the basis for the prosecution,—is admitted;

[Page 294]

That view was not seriously controverted at bar, counsel insisting rather that there was no evidence of actual complicity of the appellants in, or of their privity to, the admittedly illegal acts done by the Windsor group, alleged by the Crown to be merely illustrative of the ways and means adopted—if not directed by the head office (in Toronto) of Singer and the two appellants—to carry out the objects of the organization, which they controlled and over which they presided. On the contrary, if there be evidence to warrant convictions of the appellants for breach of the Combines Investigation Act by actual participation in the formation of a combine within the meaning of that statute, and evidence to justify convictions for conspiracy under s. 498 of the Criminal Code—and we think there was abundant evidence to support the convictions for both offences—we cannot understand the materiality to the validity of the convictions of evidence bearing upon such other matters.

Moreover, we think the Appellate Division was entirely right in its conclusion that the trial judge had misdirected himself when, although it was his opinion that both Belyea and Weinraub had “undoubtedly * * * (taken) an active part in the formation of the organization,” he held that, because there was not sufficient evidence to warrant his finding that they had also actually taken part in the Windsor operations, or were parties or privies thereto, they were not implicated in the conspiracy charged, or in the formation of the illegal combine. We are in accord with the view of the Appellate Division expressed in these words:

That these respondents took an active part in the original scheme,—the conspiracy which formed the basis for the prosecution,—is admitted; the error in law into which the learned judge fell was in not distinguishing between the conspiracy itself and overt acts which, while not themselves the conspiracy, were evidence of the existence of the conspiracy. Because these respondents were not proved to have taken part in these subsequent overt acts, the learned judge acquitted them, saying of one of the respondents, “There is no evidence that connects him with any of the illegal operations.”

We are of opinion that the appeal of the Crown must succeed. Belyea and Weinraub were most active in carrying out the projects of the conspiracy; were originally united with Singer himself in the conspiracy of which the latter was found guilty. They should have been convicted as were Singer, Paddon and Ward. Their part in the illegal acts was much greater than that of Paddon and Ward, but less than that of Singer.

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If sitting as a jury, we should have no hesitation in finding that the illegal acts done at Windsor were a result intended by the defendants and their fellow conspirators when they formed the organizations found to have been a combine and a conspiracy. But we do not proceed on this ground, since to do so would involve making a finding of fact contrary to a finding of the trial judge.

Counsel for the appellants argued at considerable length that the Appellate Division had exceeded its jurisdiction in this case because it reversed the trial judge on what counsel called a finding of fact, i.e., the innocence of the accused of participation in the formation of an illegal combine and of conspiracy within s. 498, Cr. C. This, it seems to us, involves a clear misconception of the true question in issue.

Having determined that the formation of the various organizations in question amounted to the formation of an illegal combine, and to a conspiracy within s. 498, Cr. C., the learned judge proceeded to deal with the questions as to who had incurred criminal responsibility. He convicted Singer, Paddon and Ward on evidence which, in our opinion, clearly implicated Belyea and Weinraub, in much the same manner in which Singer and his companions were involved, in the formation of the combine and conspiracy in question. He fell into error, however, when he proceeded to find that it was essential to a finding of guilt of the accused, that they should be held to have had actual knowledge of, or to have actually participated in, the overt acts at Windsor.

Mr. O’Connor, somewhat ingeniously, argued that, where there is an “inferred conspiracy,” or an “inferred combine,” as he termed them, proof of the existence of which depends largely on certain overt acts, it is necessary to show privity of the accused to, or participation by them in, such overt acts, in order to make them liable for the formation of the combine or the conspiracy. This seems to us to be a fallacy. The moment it is established that a combine or conspiracy existed, it is unnecessary, in order to warrant a conviction of the appellants for the formation of the combine, or of the agreement to conspire, to show their complicity in subsequent illegal acts done by, or with the connivance of, the body against members of which conspiracy or unlawful combine is charged: provided, always, of course,

[Page 296]

that there is, in the evidence, sufficient proof of the complicity of the accused in the original formation of the combine, or in the agreement charged as conspiracy. Here, the learned trial judge apparently had already found facts from which the conclusion was inevitable that there was participation on the part of Belyea and Weinraub in the formation of the illegal combine and the conspiracy, the existence of which he had already found to be proven. On these findings, coupled with the admissions made by Belyea and Weinraub in their testimony, and the documents of which they were proved to have had knowledge, their convictions, as was held by the Appellate Division, were a necessary consequence.

Although counsel for the appellants devotes one entire part of his Memorandum of Points, viz., Part 4, to alleged “Errors of Fact on the Trial,” i.e., errors of fact to be found in the judgment of the learned trial judge, speaking of the trial judge, he, himself, makes this formal admission, in the Memorandum, “His fact-finding was sound.” His clients certainly cannot complain if they be held to this admission, especially so since it appeals to us as being, with the one exception above adverted to, entirely correct.

Upon the material facts found by the learned trial judge, we think that manifestly his conclusion, resulting in the acquittal of the appellants, was erroneous, and that such error was the direct result of a misdirection in law.

The right of appeal by the Attorney-General, conferred by s. 1013 (4), Cr. C., as enacted by c. 11, s. 28, of the Statutes of Canada, 1930, is, no doubt, confined to “questions of law.” That implies, if it means anything at all, that there can be no attack by him in the Appellate Divisional Court on the correctness of any of the findings of fact. But we cannot regard that provision as excluding the right of the Appellate Divisional Court, where a conclusion of mixed law and fact, such as is the guilt or innocence of the accused, depends, as it does here, upon the legal effect of certain findings of fact made by the judge or the jury, as the case may be, to enquire into the soundness of that conclusion, since we cannot regard it as anything else but a question of law,—especially where, as here, it is a clear result of misdirection of himself in law by the learned trial judge.

[Page 297]

Finally,—a point not raised by counsel for the appellants during his two-and-a-half-day argument, or in his Memorandum of Points, or supplementary factum, but which would seem to call for some notice from us, is this.—By s. 1014 of the Criminal Code, the powers of the Court of Appeal, on hearing a criminal appeal by a person convicted, are defined. These powers, under subs. 3 are, in the event of the appeal being allowed, to

(a) quash the conviction and direct a judgment and verdict of acquittal to be entered; or

(b) direct a new trial;

and in either case (it) may make such other order as justice requires.

This section is made applicable on any appeal by the Attorney-General against an acquittal by the provision of s. 28, c. 11, of the Statutes of Canada, 1930, that mutatis mutandis, on the appeal thereby given, the court shall have the same powers as it has on an appeal by the accused. It does seem rather a strong thing to hold that the effect of the words “mutatis mutandis” is that clause (a) must be made to read, on an appeal (by the Attorney-General) being allowed, to

(a) quash the acquittal and direct a judgment and verdict of conviction to be entered;

yet that, apparently, was the construction put upon this provision by the Appellate Division.

It occurred to some members of this Court that, under such circumstances as are here present, the correct course would be to apply clause (b) and to direct a new trial. That idea, however, would seem to involve a lurking suspicion that we are, in fact, reversing the trial judge on a question of fact, whereas, in reality, we do nothing of the kind, but, on the contrary, we affirm the facts found by him, and, upon them, we reach the conclusion that the only course open to the Appellate Division was to allow the appeal and convict the present appellants, giving to the words “mutatis mutandis” the effect given them by the Appellate Division, which we certainly are not convinced was wrong.

For these reasons, we are of the opinion that the appeals fail and must be dismissed.

Appeals dismissed.

Solicitor for the appellants: J. Gerald Kelly.

Solicitor for the respondent: The Attorney-General for Ontario.