Supreme Court of Canada
Noble et al. v. Alley, [1951] S.C.R. 64
Date: 1950-11-20
Annie Maud Noble
(Vendor) and Bernard Wolf (Purchaser) Appellants;
and
W.A. Alley, et
al. Respondents.
1950: June 13, 16; 1950: November 20.
Present: Kerwin, Taschereau, Rand, Kellock,
Estey, Locke and Fauteux JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR
ONTARIO.
Real Property—Restrictive Covenant—Covenant
not to sell land to persons of Jewish or Negro race—Validity—Certainty.
A restrictive covenant in a deed drawn in
1933 provided that the lands therein described should never be sold to any
person of the Jewish, Hebrew, Semitic, Negro or coloured race or blood and that
the restriction should remain in force until August 1, 1962.
A motion made in the Supreme Court of Ontario
for an order declaring the covenant invalid was dismissed, the Court holding
the covenant valid and enforceable. The decision was affirmed by the Court of
Appeal.
Held: (Locke
J. dissenting), that the appeal should be allowed.
Per Kerwin,
Taschereau, Rand, Kellock and Fauteux JJ.—The covenant has no reference to the
use or abstention from use of the land.
Per Kerwin and
Taschereau JJ.—It would be an unwarrantable extension of the doctrine expounded
in Tulk v. Moxhay, 2 Phil. 774; 41 E.R. 1143, or in subsequent cases, to
say that it did.
Per Rand,
Kellock and Fauteux JJ.—By its language the covenant is not directed to the
land or some mode of its use but to transfer by act of the purchaser and on its
own terms it fails in annexation to the land. On its true terms it is a
restraint on alienation.
[Page 65]
Per Rand, Kellock, Estey and Fauteux JJ The covenant is void for
uncertainty; from its language it is impossible to set such limits to the lines
of race or blood as would enable a court to say in all cases whether a proposed
purchaser is or is not within the ban. Clavering v. Ellison 11 E.R. 282
at 289; Clayton v. Ramdsen, [1943] AC. 320.
Locke J., dissenting, would have dismissed
the appeal on the ground that the application of the equitable principle in Tulk
v. Moxhay (1848) 2 Phil. 774, not having been raised before Schroeder J.,
and the Court of Appeal having in the exercise of its discretion declined to
consider the point on that ground, this Court should not interfere in a matter
that was one of practice in the Ontario courts. As to the remaining points of
law he agreed with the reasons of the Chief Justice of Ontario.
APPEAL from the judgment of the Court of
Appeal for Ontario,, affirming the judgment of Schroeder J.,, on a motion under s. 3 of The Vendors and
Purchasers Act, R.S.O., 1937, c. 168.
J.J. Robinette K.C. and W.B. Williston
for the appellant Noble.
J. Shirley Dennison K.C. and Norman
Borins K.C. for the appellant Wolf.
K.G. Morden K.C. and J.C. Osborne for the
respondents.
The judgment of Kerwin and Taschereau JJ. was
delivered by:
KERWIN J.: This is an appeal against a judgment
of the Court of Appeal for Ontario1 affirming the judgment of
Schroeder J.2 on a motion under s. 3 of The Vendors and
Purchasers Act, R.S.O. 1937, c. 168. That section, so far as relevant,
provides that a vendor of real estate may apply in a summary way to the Supreme
Court in respect of any requisition or objection arising out of, or connected
with, a contract for the sale or purchase of land. The motion was made by the present
appellant, Mrs. Noble, as the vendor under a contract for the sale by her
to the purchaser, her co-appellant Bernard Wolf, of land forming part of a
summer resort development known as the Beach O’Pines.
[Page 66]
This land had been purchased in 1933 by
Mrs. Noble from the Frank S. Salter Company, Limited, and in the deed from
it to her appeared the following covenant:
And the Grantee for himself his heirs,
executors, administrators and assigns, covenants and agrees with the Grantor
that he will carry out, comply with and observe, with the intent that they
shall run with the lands and shall be binding upon himself, his heirs,
executors, administrators and assigns, and shall be for the benefit of and
enforcible by the Grantor and/or any other person or persons seized or
possessed of any part or parts of the lands included in Beach O’Pines
Development, the restrictions herein following, which said restrictions shall
remain in full force and effect until the first day of August, 1962, and the
Grantee for himself, his heirs, executors, administrators and assigns further
covenants and agrees with the Grantor that he will exact the same covenants
with respect to the said restrictions from any and all persons to whom he may
in any manner whatsoever dispose of the said lands.
* * *
(f) The lands and premises herein
described shall never be sold, assigned, transferred, leased, rented or in any
manner whatsoever alienated to, and shall never be occupied or used in any
manner whatsoever by any person of the Jewish, Hebrew, Semitic, Negro or
coloured race or blood, it being the intention and purpose of the Grantor, to
restrict the ownership, use, occupation and enjoyment of the said recreational
development, including the lands and premises herein described, to persons of
the white or Caucasian race not excluded by this clause.
Although the deed was not signed by
Mrs. Noble, I assume that she is bound to the same extent as if she had
executed it.
Each conveyance by the Company to a purchaser of
land in the development contained a covenant in the same form. The present
respondents, being owners of other parcels of land in the development, were
served with notice of the application either before Schroeder J. or the Court
of Appeal, and they and their counsel affirmed the validity of the covenant,
its binding effect upon Mrs. Noble, and that any of the respondents are
able to take advantage of the covenant so as to prevent by injunction its
breach. While before the judge of first instance the vendor and purchaser apparently
took opposite sides, each of them appealed to the Court of Appeal and, there,
as well as before this Court, attacked the contentions put forward on behalf of
the respondents.
In the Courts below emphasis was laid upon the
decision of Mackay J. in Re Drummond Wren,
and it was considered that the motion was confined to the consideration
[Page 67]
of whether that case, if rightly decided,
covered the situation. The motion was for an order declaring that the objection
to the covenant made on behalf of the purchaser had been fully answered by the
vendor and that the same did not constitute a valid objection to the title or
for such further and other order as might seem just. The objection was:
REQUIRED in view of the fact that the
purchaser herein might be considered as being of the Jewish race or blood, we
require a release from the restrictions imposed in the said clause (f)
and an order declaring that the restrictive covenant set out in the said clause
(f) is void and of no effect.
The answer by the vendor was that the decision
in Re Drummond Wren applied to the facts of the present sale with the
result that clause (f) was invalid and the vendor and purchaser were not bound
to observe it. In view of the wide terms of the notice of motion, the
application is not restricted and it may be determined by a point taken before
the Court of Appeal and this Court, if not before Mr. Justice Schroeder.
That point depends upon the meaning of the rule
laid down in Tulk v. Moxhay. This
was a decision of the Lord Chancellor, Lord Cottenham, affirming a decision of
the Master of the Rolls. The judgment of the Master of the Rolls appears in 18
L.J.N.S. (Equity) 83, and the judgment of the Lord Chancellor is more fully
reported there than in Phillips’ Reports. In the latter, the Lord Chancellor is
reported as saying, page 777:
That this Court has jurisdiction to enforce
a contract between the owner of land and his neighbour purchasing a part of it,
that the latter shall either use or abstain from using the land purchased in a
particular way, is what I never knew disputed.
In the Law Journal, the following appears at p.
87:
I have no doubt whatever upon the subject;
in short, I cannot have a doubt upon it, without impeaching what I have
considered as the settled rule of this Court ever since I have known it. That
this Court has authority to enforce a contract, which the owner of one piece of
land may have entered into with his neighbour, founded, of course, upon good
consideration, and valuable consideration, that he will either use or abstain
from using his land in any manner that the other party by the contract
stipulates shall be followed by the party who enters into the covenant, appears
to me the very foundation of the whole of this jurisdiction. It has never, that
I know of, been disputed.
[Page 68]
At p. 88 of the Law Journal, the Lord Chancellor
states that the jurisdiction of the Court was not fettered by the question
whether the covenant ran with the land or not but that the question was whether
a party taking property, the vendor having stipulated in a manner, binding by
the law and principles of the Court of Chancery to use it in a particular way
will not be permitted to use it in a way diametrically opposite to that which
the party has covenanted for. To the same effect is p. 778 of Phillips’s.
In view of these statements I am unable to gain
any elucidation of the extent of the equitable doctrine from decisions at law
such as Congleton v. Pattison and Rogers
v. Hosegood. It is
true that in the Court of Appeal, at p. 403, Collins L.J., after referring to
extracts from the judgment of Sir George Jessel in London & South
Western Ry. Co. v. Gomm, said
at p. 405:
These observations, which are just as
applicable to the benefit reserved as to the burden imposed, shew that in equity,
just as at law, the first point to be determined is whether the covenant or
contract in its inception binds the land. If it does, it is then capable of
passing with the land to subsequent assignees; if it does not, it is incapable
of passing by mere assignment of the land.
This, however, leaves untouched the problem as
to when a covenant binds the land.
Whatever the precise delimitation in the rule in
Tulk v. Moxhay may be, counsel were unable to refer us to any case where
it was applied to a covenant restricting the alienation of land to persons
other than those of a certain race. Mr. Denison did refer to three
decisions in Ontario: Essex
Real Estate v. Holmes; Re
Bryers and Morris; Re
McDougall v. Waddell; but
he was quite correct in stating that they were of no assistance. The holding in
the first was merely that the purchaser of the land there in question did not
fall within a certain prohibition. In the second an inquiry was directed,
without more. In the third, all that was decided was that the provisions of s.
1 of The Racial Discrimination Act, 1944, (Ontario), c. 51
would not be violated by a deed containing a covenant on the part of the
purchaser that certain lands or any buildings erected thereon should not at any
time
[Page 69]
be sold to, let to or occupied by any person or
persons other than Gentiles (non-semitic (sic)) of European or British or Irish
or Scottish racial origin.
It was a forward step that the rigour of the
common law should be softened by the doctrine expounded in Tulk v. Moxhay but
it would be an unwarrantable extension of that doctrine to hold, from anything
that was said in that case or in subsequent cases that the covenant here in
question has any reference to the use, or abstension from use, of land. Even if
decisions upon the common law could be prayed in aid, there are none that go to
the extent claimed in the present case.
The appeal should be allowed with costs here and
in the Court of Appeal. There should be no costs of the original motions in the
Supreme Court of Ontario.
The judgment of Rand, Kellock and Fauteux JJ.
was delivered by:
RAND J.:—Covenants enforceable under the rule of
Tulk v. Moxhay, are
properly conceived as running with the land in equity and, by reason of their
enforceability, as constituting an equitable servitude or burden on the
servient land. The essence of such an incident is that it should touch or
concern the land as contradistinguished from a collateral effect. In that
sense, it is a relation between parcels, annexed to them and, subject to the
equitable rule of notice, passing with them both as to benefit and burden in
transmissions by operation of law as well as by act of the parties.
But by its language, the covenant here is
directed not to the land or to some mode of its use, but to transfer by act of
the purchaser; its scope does not purport to extend to a transmission by law to
a person within the banned class. If, for instance, the grantee married a
member of that class, it is not suggested that the ordinary inheritance by a
child of the union would be affected. Not only, then, it is not a covenant
touching or concerning the land, but by its own terms it fails in annexation to
the land. The respondent owners are, therefore, without any right against the
proposed vendor.
[Page 70]
On its true interpretation, the covenant is a
restraint on alienation. The grantor company which has disposed of all its
holdings in the sub-division has admittedly ceased to carry on business and by
force of the provisions of The Companies’ Act, R.S.O. 1937, c. 251, s.
28 its powers have become forfeited; but by ss. (4) they may, on such
conditions as may be exacted, be revived by the Lieutenant-Governor in Council.
Assuming the grantor would otherwise be entitled to enforce the covenant in
equity against the original covenantor—and if he would not the point falls—it
becomes necessary to deal with the question whether for the purposes of
specific performance the covenant is unenforceable for uncertainty.
It is in these words: (See clause (f) p—?
The lands and premises herein described
shall never be sold, assigned, transferred, leased, rented or in any manner
whatsoever alienated to, and shall never be occupied or used in any manner
whatsoever by any person of the Jewish, Hebrew, Semitic, Negro or coloured race
or blood, it being the intention and purpose of the Grantor, to restrict the
ownership, use, occupation and enjoyment of the said recreational development,
including the lands and premises herein described, to persons of white or
Caucasian race not excluded by (this clause.
If this language were in the form of a
condition, the holding in Clayton v. Ramsden, would be conclusive against its
sufficiency. In that case the House of Lords dealt with a condition in a devise
by which the donee became divested if she should marry a person “not of
Jewish parentage and of the Jewish faith” and held it void for uncertainty. I
am unable to distinguish the defect in that language from what we have here: it
is impossible to set such limits to the lines of race or blood as would enable
a court to say in all cases whether a proposed purchaser is or is not within
the ban. As put by Lord Cranworth in Clavering v. Ellison, at p. 289 the condition “must
be such that the Court can see from the beginning, precisely and distinctly, upon
the happening of what event it was that the preceding estate was to determine.”
The effect of the covenant, if enforceable,
would be to annex a partial inalienability as an equitable incident of the
ownership, to nullify an area of proprietary powers.
[Page 71]
In both cases there is the removal of part of
the power to alienate; and I can see no ground of distinction between the
certainty required in the one case and that of the other. The uncertainty is,
then, fatal to the validity of the covenant before us as a defect of or
objection to the title.
I would, therefore, allow the appeal and direct
judgment to the effect that the covenant is not an objection to the title of
the proposed vendor, with costs to the appellants in this Court and in the
Court of Appeal.
ESTEY J.:—The appellants Noble as vendor and
Wolf as purchaser were negotiating relative to a summer residence in an area
known as the Beach O’Pines on Lake Huron. In the course thereof questions were
raised as to the validity of clause (f) (hereinafter quoted) in the
agreement under which the appellant Noble acquired the premises on the 16th of January, 1933, from the Frank S.
Salter Company Limited. The appellant Noble, therefore, brought a motion under
the Vendors and Purchasers Act (R.S.O. 1937 c. 168) for an order, inter
alia, that the restrictive covenant (clause (f)) did not constitute
a valid objection to the title. Mr. Justice Schroeder held the covenant to
be valid and his judgment was affirmed by the Court of Appeal for Ontario.
The appellants contend this clause (f) is
contrary to public policy, constitutes a restraint upon alienation and is void
for uncertainty.
Clause (f) is a subparagraph in the
following clause:
And the Grantee for himself, his heirs,
executors, administrators and assigns, covenants and agrees with the Grantor
that he will carry out, comply with and observe, with the intent that they
shall run with the lands and shall be binding upon himself, his heirs,
executors, administrators and assigns, and shall be for the benefit of and
enforceable by the Grantor and/or any other person or persons seized or
possessed of any part or parts of the lands included in Beach O’Pines
Development, the restrictions herein following, which said restrictions shall
remain in full force and effect until the first day of August, 1962, and the
Grantee for himself, his heirs, executors, administrators and assigns further
covenants and agrees with the Grantor that he will exact the same covenants
with respect to the said restrictions from any and all persons to whom he may
in any manner whatsoever dispose of the said lands.
* * *
(f) The lands and premises herein
described shall never be sold, assigned, transferred, leased, rented or in any
manner whatsoever alienated to, and shall never be occupied or used in any
manner whatsoever by any
[Page 72]
person) of the Jewish, Hebrew, Semitic,
Negro or coloured race or blood, it being the intention and purpose of the
Grantor, to restrict the ownership, use, occupation and enjoyment of the said
recreational development, including the lands and premises herein described, to
persons of the white or Caucasian race not excluded by this clause.
This restrictive covenant literally construed
would prohibit any person possessing the slightest degree of race or blood
specified purchasing any land in this area. So construed it would be necessary
to determine whether it constituted such a substantial restraint upon
alienation as to make the clause void “as being repugnant to the very
conception of ownership.” Cheshire’s Modern Real Property, 5th Ed. p. 528.
It is, however, submitted that the parties never
intended that the language should be so strictly construed. Once, however,
another or more liberal construction be given the issue becomes one of what
degree of race or blood would be permitted. As to what degree the contract is
silent. A judge, therefore, called upon to determine this issue, finds in the
contract no standard or other assistance that would constitute a basis upon
which the issue might be determined. His position would be analogous to that of
the Earl of Halsbury in Murray v. Dunn,
where he stated:
I confess I have been looking in vain for
some definite guide as to what is suggested to be the real meaning. Both the
learned counsel who have addressed your Lordships have, I think, failed to give
any definite meaning to the words.
In Sifton v. Sifton, the testator provided for certain
payments to be made to his daughter subject to a condition subsequent that “the
payments to my said daughter shall be made only so long as she shall continue
to reside in Canada.” This was
held to be void for uncertainty. It was agreed that the testator did not intend
that his daughter should remain absolutely in Canada, but for what period and for what purpose she might remain outside
of Canada could not be
ascertained from the terms of the will.
In Clayton v. Ramsden, the testator bequeathed a pecuniary
legacy and a share of the residue upon trust for his daughter subject to a
condition subsequent that if his
[Page 73]
daughter “shall at any time after my death
contract a marriage with a person who is not of Jewish parentage and of the
Jewish faith then * * * all
the * * * provisions * * * shall cease
and determine * * *” Lord Romer, with whom Lord Atkin and Lord
Thankerton agreed, was of the opinion that “Jewish parentage,” as used in this
will, meant of the Jewish race and that the condition subsequent was void for
uncertainty. At p. 333 he stated:
It seems far more probable that the
testator meant no more than that the husband should be of Hebraic blood. But
what degree of Hebraic blood would a permissible husband have to possess? Would
it be sufficient if one only of his parents were of Hebraic blood? If not,
would it be sufficient if both were? If not, would it be sufficient if, in
addition, it were shown that one grandparent was of Hebraic blood or must it be
shown that this was true of all his grandparents? Or must the husband trace his
Hebraic blood still further back? These are questions to which no answer has
been furnished by the testator. It was, therefore, impossible for the court to
see from the beginning precisely or distinctly on the happening of what event
it was that Mrs. Clayton’s vested interests under the will were to
determine, and the condition is void for uncertainty.
Lord Romer’s decision is based upon Clavering
v. Ellison, where
at 725 Lord Cranworth stated:
that where a vested estate is to be
defeated by a condition on a contingency that is to happen afterwards, that
condition must be such that the Court can see from the beginning, precisely and
distinctly, upon the happening of what event it was that the preceding vested
estate was to determine.
The foregoing are cases of conditions subsequent
providing for the divesting of vested estates. It is contended that such
precise and distinct language is not required in restrictive covenants. On the
contrary, both upon principle and authority, the same clarity would appear to
be essential.
Restrictive covenants constitute “an equity
attached to land by the owner,” Lord Cottenham in Tulk v. Moxhay; and in Hall v. Ewin, Lord Lindley states: “The principle of Tulk
v. Moxhay * * * imposes a burden on the land
* * *” This burden passes with the land against all but purchasers
without notice thereof and parties interested are entitled to ascertain from
the covenant the exact nature, character and extent of the restriction.
[Page 74]
Moreover, these covenants constituting a burden
upon the land must, in general, interfere with the right of disposition
thereof. Lord Dunedin, in speaking of a condition restricting land, and the
same rule of construction would apply to a covenant, stated, in Anderson v.
Dickie at
227:
Far earlier than this it had been held that
all conditions restricting the use of land must be very clearly expressed, (the
presumption being always for freedom;
In Murray v. Dunn, a covenant, by way of a servitude,
provided that “any building of an unseemly description” should not be erected
upon the premises. Lord Kinnear in the First Division of the Court of Session
for Scotland delivered a
judgment which was approved of in the House of Lords. In the course of his
judgment he stated that the bond of servitude “provides no standard for the
specific application of the terms * * *” and at 287:
So far as my opinion goes, I cannot say
that it is unseemly; the utmost that can be said for the pursuers’ case is that
that is a matter of opinion, and if there may be a reasonable difference of
opinion as to the specific application of the terms in which a servitude is
expressed to the facts of a particular case, it is not a well-defined
servitude.
In Brown—Covenants Running with Land, at
p. 126, the author states:
A restrictive covenant as to letting or
user of property will be construed strictly; the Court will not extend it on
the ground of presumed intention.
See also Jolly—Restrictive Covenants Affecting Land, at p. 77 and p. 79.
These authorities support the view that the
language of a restrictive covenant must set forth clearly and distinctly the
intent of the parties. The general language in clause (f), with great
respect to those learned judges who hold a contrary view, fails to indicate the
intention of the parties as to the amount or degree of the prohibited race or
blood that might be permitted. It must, therefore, upon the authorities, be
held void for uncertainty.
The appeal should be allowed with costs here and
in the Court of Appeal. There should be no costs of original motion in the
Supreme Court of Ontario.
[Page 75]
LOCKE J. (dissenting):—The proceedings in this
matter were initiated by an application made by the appellant Noble to the
Supreme Court of Ontario under the provisions of The Vendors and Purchasers
Act (R.S.O. 1937, c. 168) and The Conveyancing and Law of Property Act (R.S.O.
1937, c. 152) in the following circumstances. By deed dated January 10th. 1933,
the Frank S. Salter Company Limited granted to the said appellant a plot of
land situate in a summer resort known as Beach O’Pines in the Township of
Bosanquet on the shores of Lake Huron, together with a right-of-way over
certain lands described in a deed of land from that company to Beach O’Pines
Club Limited, for the purpose of ingress and egress from and to the public
highway and the water’s edge of Lake Huron. By the conveyance it was recited, inter
alia, that the grantee covenanted for herself, her heirs, executors,
administrators and assigns to carry out, comply with and observe, with the
intent that they should run with the lands and be binding upon her and upon
them and be for the benefit of and enforcible by the grantor and any other
persons seized or possessed of lands included in the Beach O’Pines Development,
the restrictions thereafter recited which were to remain in force until
August 1, 1962, and that she would exact the same covenants with
respect to the said restrictions from any person to whom she might dispose of
the lands of the various restrictions thereafter recited. The only one with
which we are concerned is in a clause lettered (f) and provided that the
lands should never be sold, rented or in any manner alienated to and never be
occupied or used in any manner by any person of the Jewish, Hebrew, Semitic,
Negro or coloured race or blood, it being the declared intention and purpose of
the grantor to restrict the ownership, use, occupation and enjoyment of the
said recreational development, including the described lands, to persons of the
white or Caucasian race. While Mrs. Noble apparently did not execute the
conveyance she took possession under it and it is not contended on her behalf
that if otherwise enforcible against her she is not bound by its terms.
By an offer to purchase dated April 19, 1948, the appellant Bernard Wolf
offered to purchase the property from
[Page 76]
Mrs. Noble and while the fact was not
proven it is apparently common ground that this offer was accepted in writing.
The proposal stipulated that Wolf should be allowed twenty days from the date
of its acceptance to investigate the title and if within that time he should
present any valid objection to the title which the vendor should be unwilling
or unable to remove, the agreement should terminate. Thereafter, by letter
dated the 5th day of May, 1948, the solicitor for Wolf submitted the following
requisitions to the solicitor for Mrs. Noble:
Required in view of the fact that the
purchaser herein might be considered as being of the Jewish race or blood, we
require a release from the restrictions imposed in the said clause (f)
and an order declaring that the restrictive covenant set out in the said clause
(f) is void and of no effect.
Mrs. Noble’s solicitor replied to that
requisition by a letter dated May 6, 1948, stating:
In our opinion the decision rendered in the
case of re Drummond Wren, 1945 Ontario Reports p. 778 applies to the
facts of the present sale, with the result that the clause (f) objected
to is invalid and the vendor and purchaser are not bound to observe it.
In a letter written on the same date the
purchaser replied insisting upon an order of the court being obtained in which
it would be declared that the said restrictive covenant was “void and of no
effect.” These proceedings were then initiated by a notice of motion given on
behalf of Mrs. Noble:
for an order declaring that the objection
to the restrictive covenant made in writing on behalf of the purchaser dated
the 5th day of May, 1948, has been fully answered by the vendor and that the
same does not constitute a valid objection to the title.
In view of the subsequent course of these
proceedings it is of importance to consider the nature of the material filed on
the application and the identity of the persons who were notified of the
proceedings and took part in the argument. In support of the motion there was
filed an affidavit of one of the solicitors for Mrs. Noble reciting the
purchase of the property by her, the registration of the deed, the terms of the
requisition made by the solicitor for Wolf, the terms of the subsequent
correspondence, and stating that she had been advised by the solicitors from
the Beach O’Pines Protective Association that if the sale to Wolf was to be
concluded they were instructed to commence proceedings at once to enforce the
restriction set out
[Page 77]
in clause (f). On May 8, 1948, on the
joint application of the parties MacKay J. directed that a copy of the notice I
of motion to be served on the Beach O’Pines Protective Association and upon the
Frank S. Salter Company Limited at least ten days before the hearing of the
application. This Association is apparently an unincorporated body formed by
some 35 persons owning and occupying property in the Beach O’Pines Development
who had associated themselves together for the purpose of improving the
property and of safeguarding the rights, privileges and quiet enjoyment of
their members. Apparently on its behalf an affidavit of one of its members,
James Burgess Book, was filed stating, inter alia, that the community
had been developed as a summer recreational area, that the improvements made by
the Association and the congeniality of its members had to a large extent improved
the value of the lands, and that unless the restrictions and conditions
concerning the lands were enforced it was his opinion and that of the Committee
of the Association that the character of the community would be changed, with
the result that the desirability of the locality as a summer residence for the
present owners would be lessened and the value of the lands depreciated. On
behalf of Wolf an affidavit of one of his solicitors was filed stating that he
had searched the file of the Frank S. Salter Company Limited in the office of
the Provincial Secretary at Toronto, that the last named address of Salter was
in Detroit and producing what was stated to be a true copy of a statutory
declaration made by Salter, said to be filed with the Provincial Secretary
dated April 1, 1937, in which it was said, inter alia, that the company
had held no meeting of directors or shareholders during the past four years and
that “by reason that the company has not used its corporate powers for three
and a half consecutive years such powers have become forfeited under
section 28 of the Companies Act.” This apparently was intended to be proof
of the facts stated in the copy of the declaration. In addition, there was an
affidavit showing that all of the conveyances of lands in the development made
by the Salter Company contained the same restrictive covenants and conditions
as those in the deed to Noble.
[Page 78]
When the matter came before Mr. Justice
Schroeder he considered that a representation order should be made and directed
that the interests of other land owners interested but not represented should
be represented by six named persons, presumably land holders in the
development. Both Noble and Wolf were represented by counsel on the argument.
It is clear from the reasons for judgment delivered by Schroeder J. that the
only questions argued were that the restrictive covenant was unenforceable as
being contrary to public policy, as being void for uncertainty and on the
further ground that it was an unlawful attempt to restrain the alienation of
property conveyed in fee simple. These issues were those which had been
considered and decided by MacKay J. in the Drummond Wren case and these Schroeder J. decided adversely
to the contention of the vendor. When the matter came before the Court of
Appeal other counsel represented Wolf and a further question of law was raised
which had not theretofore been argued or considered. Stated briefly the point
is that the covenant contained in clause (f) is neither a covenant which
would run with the land and therefore bind Wolf or subsequent owners, nor did
it create a negative easement binding upon him or subsequent purchasers from
him, whether with or without notice of its existence. The equitable principle,
the extent of which is to be decided if the question is before us, is that
stated by Lord Cottenham in Tulk v. Moxhay. This question is entirely distinct from
the three issues which were submitted for the opinion of Schroeder J. and the
Chief Justice of Ontario with whom Aylesworth J.A. agreed, and Hogg J.A.
declined to consider it. Henderson and Hope JJ.A. gave written reasons but did
not refer to the point, directing their attention to the matters that had been
raised before Schroeder J.: I would, however, assume that they also considered
the matter should not be dealt with. As the matter comes before us a majority
of the court at least, if not all of its members, have declined to consider
this point of law upon which the opinion of the learned judge in chambers has
not been obtained.
[Page 79]
Speaking generally, it has not been the practice
of this court to interfere with the decisions of courts of appeal in matters of
their own procedure. In Toronto Railway v. Balfour, the court refused to interfere with a
decision of the Court of Appeal for Ontario in a matter of procedure,
Taschereau J. saying that the matter was but a question of practice and
consequently one with which, in accordance with the jurisprudence, the court
would not interfere and referring to O’Donnell v. Beatty; Williams v. Leonard and Sons, and Price v. Fraser. In Finnie v. City of Montreal, Girouard J. pointed out that in matters
of mere procedure when no injustice is shown the court will not interfere with
the action of the court below. See also Laing v. Toronto General Trusts. Where, however, a grave injustice has
been inflicted upon a party to a suit the court has interfered for the purpose
of granting the appropriate relief, though the question may be one of procedure
only as in Lamb v. Armstrong, and Eastern
Townships Bank v. Swan. The
question as to whether a court of appeal should hear questions of law not
raised in the court below frequently is a difficult one to determine. Some of
the objections to permitting the practice are pointed out in the judgment of
Lord Finlay L.C. in Banbury v. Bank of Montreal, at 661-2. In S.S. “Tordenskjold” v.
S.S. “Euphemia” at
163, Duff J. as he then was said:
The principle upon which a Court of Appeal
ought to act when a view of the facts of a case is presented before it which
has not been suggested before is stated by Lord Herschell in The “Tasmania”,
at p. 225, thus:
My Lords, I think that a point such as
this, not taken at the trial, and presented for the first time in the Court of
Appeal, ought to be most jealously scrutinized. The conduct of a cause at the
trial is governed by, and the questions asked of the witnesses are directed to,
the points then suggested. And it is obvious that no care is exercised in the
elucidation of facts not material to them.
It appears to me that under these
circumstances a court of appeal ought only to decide in favour of an appellant
on a ground there put forward for the first time, if it be satisfied beyond
doubt, first, that it has before it all the facts bearing upon the new contention,
[Page 80]
as completely as would have been the case
if the controversy had arisen at the trial; and next, that no satisfactory
explanation could have been offered by those whose conduct is impugned if an
opportunity for explanation had been afforded them when in the witness box.
The settlement of the question involves the
exercise of a discretion (Banbury v. Bank of Montreal,). It is, I think, of importance that when
the matter was brought before the Court of Appeal, as noted in the judgment of
the Chief Justice of Ontario, there was doubt as to whether the representation
order made by Schroeder J. was authorized by the Rules of Court and that 37
additional interested parties were notified of the proceedings so that they
might, if they wished, be heard. If under the practice the representation order
was not properly made these persons were apparently not represented at the
first hearing. Whether if the point now sought to be argued had been raised
before Schroeder J. these persons or the six individuals who were then
represented by Mr. Morden, K.C. would have considered that further
evidence might be given which would affect the determination of the matter, I
do not know and I must decline to speculate. The learned judges of the Court of
Appeal for Ontario had
exercised their discretion and declined to consider the matter and I think we
should not interfere with their decision.
As to the remaining matters argued so fully
before us, I agree with the learned Chief Justice of Ontario.
In my opinion this appeal should be dismissed
with costs.
Appeal allowed with costs.
Solicitors for the appellant (Vendor):
Carrothers, McMillan and Egener.
Solicitors for the appellant (Purchaser):
Richmond and Richmond.
Solicitors for the Respondents: Day,
Wilson, Kelly, Martin and Morden.
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