Supreme Court of Canada
Miller
v. The King, [1950] S.C.R. 168
Date:
1949-12-05
Frank Miller, Chief Councillor Of The Six Nations Of
The Grand River, On Behalf Of Himself and All Others, Members Of The Said Six
Nations Of The Grand River, and The Said Six Nations Of The Grand River.
(Suppliants) Appellants;
and
His Majesty The King. (Respondent) Respondent.
1949: March 14, 15; 1949: December 5.
Present:—Kerwin, Taschereau, Rand, Kellock and Locke JJ.
ON APPEAL FROM THE EXCHEQUER COURT OF CANADA
Crown—Petition of Right—Whether the Crown in the right
of the Dominion of Canada liable for alleged breaches of trust or debts of (a)
the government of the Province of Canada, (b) the government of the Province of
Upper Canada—s. 111. The British North America Act.
The appellant seeks by Petition of Right to hold the Crown in
the right of Canada liable in damages for breaches of trust and contract. The
breaches alleged fall under three heads: (1) that in 1824 the Parliament of
Upper Canada by statute authorized the flooding by the Welland Canal Co. of
some 1800 acres of lands previously granted to the Six Nations Indians,
appellant's ancestors, by the Crown and although the statute provided for
compensation, the Department of Indian Affairs or its officers as trustees of
the said Indians failed to collect it; (2) that in 1836 the Government of Upper
Canada authorized a free grant of a further 360 acres of said Indians' lands to
the Grand River Navigation Co. and that the said trustees failed to secure
compensation therefor; (3) that in 1798 the appellant's ancestors surrendered
certain lands to the Crown under an agreement whereby the said lands were to be
sold and the purchase moneys held in trust for the said Indians benefit and
that in 1836 the said government without the knowledge or consent of the
Indians and without authority contracted to purchase stock of the Grand River
Navigation Co. for them, and that the said government and, after the Union of
1840, the Government of the Province of Canada, pursuant to such contract paid
out $160,000 from the said Indian funds which on the failure of the company was
lost. Appellant claims that since by s. 111 of the British North America Act
the Crown in the right of the Dominion of Canada assumed liability for the
debts of the former Province of Canada, the said sum with interest should be
restored to the funds held by the present Department of Indian Affairs and the
federal government on behalf of the appellants.
[Page 169]
Held: that as to heads one and two of the Petition, any
breach of trust, if it occured, took place before the Act of Union of 1840 and
appellant had not shown any basis of obligation upon the Crown in the right of
the Dominion of Canada.
As to head three, the appeal was allowed and the matter
referred back to the Court of Exchequer.
The question as to whether the claim was barred by the Exchequer
Court Act or the Statute of Limitations was not dealt with by the
trial judge nor by this Court.
APPEAL from the judgment of the Exchequer Court of
Canada, O'Connor J., answering in the negative the first of
two questions of law set down for argument, viz: (1) Assuming the allegations
of fact contained in the Petition of Right read with the particulars filed by
the Suppliants to be true, does a Petition of Right lie against the Respondent
for any of the relief sought by the Suppliants in the said Petition? (2) If a
Petition of Right would otherwise lie against the Respondent for any of the
relief sought by the said Petition, is the said Petition barred by the Exchequer
Court Act and the Statute of Limitations (Ontario)?
Auguste Lemieux, K.C. for
the appellants.
W. R. Jackett for the respondent.
The judgment of Kerwin and Rand JJ. was delivered by:—
Kerwin J.:—This
is an appeal by the suppliants against a decision of the Exchequer Court (1)
answering in the negative a question of law set down for determination prior to
the hearing. The question is as follows:—
Assuming the allegations of fact contained in the Petition
of Right read with the particulars filed by the Suppliants on October 21, 1943,
and September 5, 1944, pursuant to orders made by the President of this
Honourable Court on June 3, 1942, and December 21, 1943, respectively, to be
true, does a Petition of Right lie against the Respondent for any of the relief
sought by the Suppliants in the said Petition?
The claims in the petition of right may be classified under
three headings. 1. Certain lands in what is now the Province of Ontario were,
on February 5, 1798, surrendered by the Six Nations Indians to the then reigning
Sovereign by a document which concluded:—"and do
[Page 170]
beseech his said Majesty to grant the same in fee to the
Persons in the said Schedule mentioned for the several and respective
considerations to the said Lands annexed which are to receive from the said
Persons, as an Equivalent for the same." The unsatisfactory nature of the
petition has been pointed out in the reasons for judgment in the Exchequer
Court but, giving it the most favourable construction that can be suggested on
behalf of the suppliants, this claim, which is for the value of part of the
lands so surrendered destroyed by flooding, arose before the Act of Union of
1840 and there is no way in which the respondent can be held responsible. The
respondent is His Majesty in the right or interest of the Dominion of Canada
which, of course, came into existence in 1867. The same consideration is
sufficient to dispose of claim 2, which is for the value of lands contained in
a free grant to the Grand River Navigation Company in 1836.
There is more difficulty as to claim 3 as to which it is
alleged that in or about the year 1833 the Government of Upper Canada "and
subsequently the Government of Canada after the Union of 1840" paid out of
the proceeds of the sale of the lands surrendered in 1798, the sum of $160,000
for the purchase of shares of the Grand River Navigation Company. It will be
noticed that the only difference so far as dates are concerned between claims 1
and 2, on the one hand, and claim 3, on the other, is that, in the latter, the
claim is made that the Government of Canada after the Union of 1840 paid money
for the purchase of the shares. The respondent argues that the petition of
right shows, at the most, an obligation of His Majesty in the right of the
Imperial Government. The allegations are contradictory in many respects but, in
disposing of the question of law, they should not be construed too strictly
against the suppliants, and I am therefore disposed to leave the matter as the
facts to be presented to the trial judge would warrant. Whether or not a trial
ensues will depend upon the outcome of the argument of the second question of
law set down for determination, viz., as to whether the claims advanced are
barred by the Exchequer Court Act and the Ontario Statute of Limitations.
The disposition of the present appeal will
[Page 171]
be without prejudice to such question of law being
considered and dealt with so far as the third claim is concerned. The appeal
should be allowed and the answer to the question of law should be
"No" as to claims 1 and 2, and "Yes" as to claim 3. While
the Exchequer Court simply answered the question in the negative, the costs of
and incidental to the hearing were made costs in the cause. That direction
might well stand. The costs of the appeal should be to the appellants in the
cause, subject to this, that, in any event, they should not receive any costs
of or in connection with their factum.
The judgment of Taschereau and Kellock JJ. was delivered by:
Kellock J.:—In
his petition, appellant claims with respect to three separate matters; first,
the flooding of approximately 1,800 acres of land on the Six Nations Indian
Reserve near Brantford, Ontario, by reason of the execution of works pursuant
to the Statute of 1824, 4 Geo. IV, c. 17, and amending
Acts, relating to the Welland Canal; second, the taking by Order-in-Councii of
October 20, 1836, without compensation, of some 368 acres for the purposes of
the Grand River Navigation Company; and third, the use made by or at the
instance of the Crown, before and after 1840, of certain trust moneys belonging
to the said Six Nations Indians in the sum of $160,000.
By his petition and particulars appellant alleges that the
lands in claims one and two, and other lands, were the subject of a patent
dated the 14th of January, 1793, in favour of "the chiefs, women and
people of the said Six Nations and their heirs forever". It is further
alleged that on or about the 5th of February, 1798, certain of the said lands
were surrendered to the Crown by the Indians for the purpose of being
re-granted to certain purchasers, which surrender was accepted by the Crown for
the said purpose, the conveyances to the purchasers to be delivered by the
Crown upon the production of a certificate from certain trustees authorized by the
Indians to receive the mortgages to be given back, certifying that the
purchasers
[Page 172]
had done everything necessary to secure to the Indians and
their posterity the "stipulated annuities and considerations which they
agree to give for the same".
The petition then alleges the passing of the Act of 1824 by
the Parliament of Upper Canada and the flooding in the year 1826 of 1826 4/5
acres by the execution of the works without any compensation at any time having
been made to the Indians, although provision was made by the statute for that
purpose. Section 9 of the statute provided that if the canal should pass
through any land in possession of any tribe or tribes of Indians, or if any act
occasioning damage to their property or possessions should be done under the
authority of the Act, compensation should be made to them in the same manner as
provided by the statute with respect to the property, possession or rights of
other individuals. "The Chief Officer of the Indian Department within this
province" was required to name an arbitrator on behalf of the Indians and
any amount awarded was to be paid to the said Chief Officer "to the use of
the said Indians". It was subsequently provided in 1826 by 7 Geo. IV, c.
19, s. 5, that all matters to be determined by arbitration under section 7 of
the earlier statute should be referred as therein provided "so that the
award or awards of such arbitrators may be made public and declared on or
before the first day of September next (1826) and that all and every sum of
money by such an award or awards directed to be paid by the said company shall
be paid to the party or parties entitled to receive the same on or before the
first day of October next".
The petition further alleges in paragraph 4 that since the
year 1784 the Department of Indian Affairs, through its Superintendent-General
or other officer or officers charged with its control and management, was an
express trustee for the Indians with respect to the control and management of
their lands and property, including moneys received on their behalf. Appellant
claims that it was the duty of the officer named in the Act of 1824, namely,
"the Chief Officer of the Indian Department" to collect the amount to
which the Indians were entitled in respect of the flooding of their lands and
that he failed to take any steps to that end, whereby they have suffered loss.
[Page 173]
The petition also alleges that on the 20th of October, 1836,
an Order-in-Council was passed in Upper Canada declaring 368 7/10 acres of the
Indian lands to be a free grant to the Grand River Navigation Company which had
been incorporated in 1832 by 2 Wm. IV, c. 13. It is alleged that a patent of
the said lands was issued to the company pursuant to this Order-in-Council and
that the Indians at no time received any compensation for the lands so taken
and that the Crown as their express trustee committed a breach of trust in
failing to see that such compensation moneys were paid.
With respect to these first two heads of claim the appellant
is in the difficulty that any breach of trust, if it occurred, took place
before the Act of Union of 1840, and the appellant has not shown any basis of
obligation resting upon His Majesty in the Right of the Dominion of Canada in
respect of such a liability, although with respect to liabilities arising after
that date section 111 of the British North America Act is relevant. I
think therefore that the appeal cannot succeed with respect to these two heads
of claim.
Coming to the third head of claim, it is alleged by the
petition that as a result of the surrender and its acceptance a definite
contractual agreement arose under which the Government of Upper Canada
undertook to take charge of and sell the surrendered lands, receive the
purchase moneys and hold the same intact "for the benefit of the
suppliants' ancestors separate and distinct from the public money of the
province, for the purpose of providing a certain sure revenue for the support
of the suppliants or their ancestors". It is further alleged that in or
about the year 1833 the Government of Upper Canada, depository and in control
of the funds arising from the sale of the Six Nations lands, of which a very
considerable amount was then in the custody and control of the Receiver General
of the said province, contracted to purchase in the name of the Six Nations,
but without their knowledge or consent, 6,121 shares of the par value of $25
each of the Grand River Navigation Company, and that the Government of Upper
Canada, through the said Receiver-General, and subsequently the Government of
Canada after the Union of 1840, paid, without further authority, out of
collections
[Page 174]
made and arising from sales of lands, the sum of $160,000.
It is alleged that these payments were in breach of the contractual agreement
referred to. The suppliants claim that the said sum of $160,000 with interest
should be restored to the funds held by the Department of Indian Affairs and
the present government, on behalf of the Indians, the whole of this money
having been illegally paid away for the said purpose and lost.
It is further alleged that by an Act of the Parliament of
Canada of the 30th of August, 1851, c. 151, the Navigation Company was
empowered to raise 40,000 pounds on debentures of the then town of Brantford by
reason of which there was created in favour of the said town a mortgage upon
all the assets of the said company as a result of which the said assets were
ultimately foreclosed by the said town and lost to the Indians.
As already pointed out, it is also alleged by the petition
that the Department of Indian Affairs from its formation in 1784 to the present
time is an express trustee of the lands and property of the Indians, including
all Indian money paid to it. It is also alleged that, in addition to the relief
claimed on the basis of the "Statutes, Ordinances and
Orders-in-Council" particularized above, the suppliants are "entitled
to succeed on equitable grounds" and the specific claim with respect to
the $160,000 is for "repayment of cash paid on stock of the Grand River Navigation
Company from trust funds of suppliants".
On behalf of the respondent it is first contended that the
allegations of fact in the petition and particulars do not show any agreement
by His Majesty or anything held by His Majesty in trust. It is said that
reference to the Crown (presumably in documents or statutes) as trustee for the
Indians and to the Indians as wards of His Majesty is not a technical use of
such terms but such references are merely descriptive of the general political
relationship between His Majesty and the Indians. It is also contended that the
only fact relied upon to show a trust or agreement is the acceptance by the
Governor-in-Council in 1798 of the surrender of the Indian lands. In addition
to the particular allegation of trust arising out of the surrender and
acceptance in 1798 there is, however, the further allegation in the petition
that the Crown, through the Indian
[Page 175]
Department and its officers, was always
a trustee for the Indians with respect to lands or moneys of the Indians.
In Civilian War Claimants Association v. The King
,
Lord Atkin said:
There is nothing so far as I know, to prevent the Crown
acting as agent or trustee if it chooses deliberately to do so.
In Kinloch v. Secretary of State for India ,
Lord Selbome, L.C., at 623 said:
Still it would not be altogether satisfactory to proceed on
that ground alone * * * if it really appeared that the intention of the Crown,
in the Order in Council and the Warrant which passed from the Crown upon this
subject, was to constitute the person who for the time being might fill that
office of state a trustee in the ordinary sense of the word, liable to account
in a Court of Equity to private persons.
At page 625 the Lord Chancellor further said:
Now the words "in trust for" are quite consistent
with, and indeed are the proper manner of expressing, every species of trust—a
trust not only as regards those matters which are the proper subjects for an
equitable jurisdiction to administer, but as respects higher matters, such as
might take place between the Crown and public officers discharging, under the
directions of the Crown, duties or functions belonging to the prerogative and
the authority of the Crown. In the lower sense they are matters within the
jurisdiction of, and to be administered by, the ordinary Courte of
Equity; in the higher sense they are not. What their sense is here, is the
question to be determined, looking at the whole instrument and at its nature
and effect.
I think the law is correctly stated in Lewin on Trusts, 14th
Ed. p. 25:
The Sovereign may sustain the character of a trustee, so far
as regards the capacity to take the estate, and to execute the trust.
The authors go on to state that doubts have been entertained
whether, the subject can by any legal process, enforce the performance of the
trust. They add at p. 26:
The subject may, undoubtedly, appeal to the Sovereign by
presenting a petition of right, and it cannot be supposed that the fountain of
justice would not do justice.
In Pawlett v. Attorney-General , the
plaintiff had executed a mortgage in favour of a mortgagee who had died and his
heir being attainted of high treason the King had seized the lands. The
plaintiff thereupon exhibited a bill against the King and the executor, seeking
redemption of the mortgage, and the question that arose was whether he could
have any remedy against the King for
[Page 176]
redemption. It was decided by Lord Hale and Baron Atkyns
that the proceedings would lie. In Esquimalt and Nanaimo Rly. v. Wilson
,
the Judicial Committee in referring to the judgment of Baron Atkyns, said:
It was stated in the report that he was strongly of opinion
that the party ought in this case to be relieved against the King, because the
King was the fountain and head of justice and equity, and it was not to be
presumed that he would be defective in either, and it would derogate from the
King's honour to imagine that what is equity against a common person should not
be equity against him.
It is provided by section 18 of the Exchequer Court Act, R.S.C.
1927, c. 34:
The Exchequer Court shall have exclusive original
jurisdiction in all cases in which demand is made or relief sought in respect
of any matter which might, in England, be subject of a suit or action against
the Crown * * *
The effect of this section is to clothe the Exchequer Court
with jurisdiction with respect to claims maintainable against the Crown whether
under the former practice they were maintainable only by petition of right or
otherwise.
With respect to a contention that there was no jurisdiction
in the ordinary courts as to claims against the Crown where a petition of right
would not lie, their Lordships in the Esquimalt case said at page 365:
But there are many cases in which petition of right is not
applicable in which the Crown was brought before the Court of Chancery, and the
Attorney-General, as representing the interests of the Crown, made defendant to
an action in which the interests of the Crown were concerned * * *
At page 367 their Lordships referred to what was said by
Lord Lyndhurst in Deare v. Attorney-General , namely:
I apprehend that the Crown always appears by the
Attorney-General in a Court of Justice, especially in a Court of Equity, where
the interest of the Crown is concerned. Therefore, a practice has arisen of
filing a bill against the Attorney-General, or of making him a party to a bill,
where the interest of the Crown is concerned.
Their Lordships proceeded:
This statement, though made on the equity side of the Court
of Exchequer, is certainly not limited to the Chancery proceedings that were
instituted in that Court; it is of wide and general application. It is in
entire agreement with the principles enunciated by Baron Atkyns in the earlier
authority, and it is recognized as being the existing practice in the Courte today.
[Page 177]
With respect to the procedure by petition of right their
Lordships said at 364:
That procedure is adopted for the recovery from the Crown of
property to which the applicant has a legal or equitable right, as, for
example, by proceedings equivalent to an action of ejectment or the payment of
money.
Section 7, subsection 1, of the Petition of Right Act, R.S.C.
1927, c. 158, is as follows:
If the petition is presented for the recovery of any real or
personal property, or any right in or to the same, which has been granted away
or disposed of by or on behalf of His Majesty, or his predecessors, a
copy of the petition and fiat, endorsed with a notice to the effect of the Form
C in the schedule to this Act, shall be served upon or left at the last or
usual or last known place of abode of the person in possession or occupation of
such property or right.
Their Lordships in the Esquimalt case at page 364
said in relation to the very similar section of the British Columbia legislation:
Sect. 7 shows that where a petition of right is presented bo
recover real or personal estate or any right granted away or disposed of on
behalf of His Majesty, a copy is to be left at the house of the person last in
possession, showing that the main claim is against the Crown, that the
person last in possession is not necessarily a proper party to the suit, but
that, in order that he may be affected with knowledge, provision is made 'that
he should be served in the manner indicated.
In Hodge v. Attorney-General , the
title-deeds of a leasehold estate had been deposited with bankers, by way of
equitable mortgage. The depositor was subsequently convicted of felony and a
bill was filed by the mortgagees against the Attorney-General for a sale of the
property. Alderson B., sitting in equity, held that the court could declare
that the plaintiffs were equitable mortgagees and directed the Master to take
an account of what was due to the plaintiffs and decreed that the plaintiffs
should hold possession of the property until their lien was satisfied. He held
that he did not have any jurisdiction to order a sale or to order the Crown to
reconvey.
I see no more difficulty in the present instance, should the
facts warrant, in making a declaration that the moneys in the hands of the
Crown are trust moneys and that the appellant and those upon whose behalf he
sues are cestuis que trust, even although the court could not direct the Crown
to pay. In this latter event it is inconceivable that at this date, any more
than in the time of Baron Atkyns,
[Page 178]
the Crown, as the fountain of Justice, would not do justice.
I think, however, no such difficulty lies in the way of an order for payment.
In Feather v. The Queen , at 294,
Coburn C.J., delivering the judgment of the court said:
We concur with that court in thinking that the only cases in
which the petition of right is open to the subject are, where the land or goods
or money of a subject have found their way into the possession of the Crown,
and the purpose of the petition is to obtain restitution, or, if restitution
cannot be given, compensation in money * * *
If this is so with respect to moneys of the subject as to
which no trust exists, it cannot be any the less so because the moneys coming
to the hands of the Grown are impressed with a trust in favour of the suppliant
and there can be no objection, as urged by Mr. Jackett, that the Crown has paid
away the moneys. This situation is expressly recognized in section 7 of the Petition
of Right-Act, already cited, and in In re Gosman it was
held that moneys transferred to the Crown by the trustees and executors of the
will of a deceased person where no next-of-kin had been discovered were
recoverable by the next-of-kin, although in the meantime the moneys had been
paid away by the Crown.
As to the moneys received in respect of the sale of the
lands, O'Connor J. construed the petition to allege that they had been received
by the trustees for the Six Nations. In this he has, I think, been misled by a
seeming ambiguity. In a letter of February 20, 1798, to the Duke of Portland,
it is stated that the trustees were "to receive for their use
mortgages and other securities for the payment to them of the several
and respective considerations stipulated". This, in my opinion, means that
the trustees were merely to hold the securities, not collect them; the words
"for the payment to them" describe the obligations for which the
securities were given; "their" and "them" signify the
Indians. This is confirmed by the minute of council of February 5, 1798,
"to secure to the Five Nations and their posterity the stipulated
annuities and considerations which they agree to give for the same". The
same minute speaks of the trustees as "authorized to receive"
mortgages of the said lands. Paragraphs 14 and 15 of the
[Page 179]
petition distinctly allege that the Crown was to and did
receive the money. The reason for putting the mortgages into trustees would
seem to be the obvious one of enabling suit or action to be taken without the
difficulty or inconvenience that would attend them in the name of the Crown.
I take the allegations, therefore, to be: that in
consideration of the surrender, the Crown, whether acting with Imperial or
Colonial advisers, undertook to convey the property to the purchasers named and
to others thereafter to be named, to receive the purchase moneys and to
maintain them as a converted form of the lands sold for the purposes of a
tribal enjoyment equivalent to that to which the Six Nations were entitled
under the grant; and that by transmission this obligation has become assumed by
the Crown in right of the Dominion. Although the matters present relations of
the nature of a trust, they contain likewise the ordinary elements of a
contract.
Under the arrangements of 1798 the persons nominated by the
Six Nations to receive the securities were the Acting Surveyor General, the
Superintendent of Indian Affairs, both officers of the Crown, and one,
Alexander Stewart, a barrister. The petition does not show how long these
persons acted or how it came about that the Department of Indian Affairs became
substituted. Some further light may be obtained from subsequent legislation.
After Union by the Act of 1841, 4 and 5 Victoria, c. 74, it
is recited that:
Whereas three-quarters of the stock of the Grand River
Navigation Company is held in trust and for the benefit of the Six
Nations Indians; and whereas by the provision of the Act incorporating the said
Company, the persons in whose name such Stock is so subscribed and held for
the said Six Nations Indians, have no adequate influence in the appointment
of the Directors! by whom the affairs of the said Company are regulated and
managed * * *
The statute proceeds to enact that it should be lawful for
the Governor of the province by and with the advice and consent of the
Executive Council to nominate and appoint two directors at every election so
long as the proportion of three-quarters of the capital stock should continue
to be held for the use and benefit of the said Six Nations Indians. The reason
for this enactment was that
[Page 180]
it had been provided by section 22 of the Act incorporating
the company that no one person should have more than fifteen votes regardless
'of the number of shares held.
A further development with respect to the holding of these
shares is evidenced by the Act of 1853, 16 Victoria, c. 256. By section 1 the
holding of a special meeting of stockholders of the company was authorized and
by section 2 it was provided that the question to be put at the meeting was whether
the company and all works connected therewith should or should not be placed
under the control and management of the government of the province. The proviso
to the section reads:
Provided always that inasmuch as three-fourths of the Stock
of the Company is held in trust for the benefit of the Six Nation
Indians, the decision so come to by the said shareholders, if in the
affirmative, shall not be valid or binding until ratified and confirmed by the Governor
as Trustee for the said Six Nation Indians.
In 1860 by 23 Victoria, c. 151, section 3, it was provided:
All moneys or securities of any kind applicable to the
support or benefit of the Indians or any tribe or band of Indians and all
moneys accrued, or hereafter to accrue, from the sale of any lands reserved or
held in trust as aforesaid, shall, subject to the provisions of this Act, be
applicable to the same purposes and be dealt with in the same manner as they
might have been applied to or dealt with before the passing of this Act.
And by section 8 it is provided:
The Governor-in-Council may, subject to the provisions of
this Act, direct how, and in what manner, and by whom, the moneys arising from
sales of Indian lands and from the property held or to be held in trust for the
Indians, shall be invested from time to time, and how the payments to which the
Indians may be entitled shall be made, and shall provide for the general
management of such lands, moneys, and property * * *
It does not appear who in 1841 were "the persons in
whose name such stock is so subscribed and held for the said Six Nation
Indians." When the history of the dealings from time to time with the
Indian moneys subsequent to their receipt is disclosed from the official
records, the court will be in a position to say what was and is the position
and obligations in law of the Crown with respect to the moneys in question. For
that purpose the matter must go to trial.
It is also contended on behalf of the respondent that if the
allegations in the petition show any legal obligation on the part of His
Majesty, it is an obligation of His
[Page 181]
Majesty in right of the Imperial Government. It is said that
until 1855, or later, the Imperial Government retained control of the
administration of Indian Affairs in Canada and reference is made to Rex v.
Hill ; St. Catherine's Milling and Lumber v.
The Queen ; and Easterbrook v. The King
.
The statements in these judgments are all, of course, statements of fact and
their applicability to the case at bar will depend upon the evidence to be adduced.
It would at present appear however, from the Act of 1841 and the Act of 1853,
already referred to, that, whatever may have been the general situation,
nevertheless, with respect at least to the moneys here in question, the local
government was purporting to exercise some measure of control. It is sufficient
for the present purposes to say that the Crown's contention cannot be given
effect to at this stage and will depend ulimately for whatever force it may
have upon the evidence.
It is next contended on behalf of the Crown that any legal
claim which might be shown by the allegations of fact in the petition arose
prior to 1840, and therefore, the appellants cannot rely upon the provisions of
section 111 of the British North America Act. I do not read the petition
as thus restricted but as alleging payments out of the moneys in question after
the Union of 1840. It may be that these payments were all made in pursuance of
one contract to buy the shares alleged to have been made in 1833, in which
event it may be contended on the part of the appellant that payments made after
the Union of 1840 cannot be justified on that ground if the contract was
illegal when made. It may be however, that the payments after Union were
independent transactions. That again is a matter for the evidence.
The respondent in its factum, although the point was not
mentioned in argument, contends that the appellant and those on whose behalf he
sues, have not shown that they, as distinct from the original members of the
Six Nations living in 1798, are entitled to any interest in the subject matter
of the petition. No difficulty was felt on this score in Henry v. The
King . Without approving or disapproving of
anything decided in that case I do not think this is an objection which can or
should be dealt with at
[Page 182]
this stage. When the evidence is fully developed the point
may or may not be of importance. I would leave it to be dealt with at the
trial.
I would allow the appeal with respect to the claim for
$160,000 and refer the same back to the Exchequer Court. The learned trial
judge below did not, by reason of the conclusion to which he came on the first
question, deal with the Statute of Limitations which was the subject of
the second question, and the reference back will be subject to the
determination of that question. This will raise the interesting question as to
whether persons with the limited civil rights of the Indians can be barred by
the statute. The matter was not argued before us and I do not deal with it.
As to costs, I agree with the order proposed by my brother
Kerwin.
Locke J.:—The
question set down for argument by an order made under the provisions of Rule
149 of the Exchequer Court states the matter to be determined as being whether,
assuming the allegations of fact contained in the Petition of Right and the
particulars delivered by the suppliant to be true, a petition of right lies
against the respondent for any of the relief sought. This has been treated
properly, in my opinion, as raising also the question as to whether the
Petition of Right discloses any cause of action, and the matter has been
disposed of by the learned trial judge upon this footing.
In so far as the claim of the suppliants is to recover
damages in respect of the lands flooded by the works of the Welland Canal in
the year 1826 and for payment of the value of the lands said to have been
granted to the Grand River Navigation Company in 1832 are concerned, I agree
that the appeal fails. Apart from the unfortunate amendment to the petition
made on April 9, 1943 which, if taken literally, would be fatal to the claim in
respect of the lands submerged, it is disclosed upon the face of the petition
that the acts complained of took place when the administration of Indian
Affairs was in the hands of the Province of Upper Canada. While by section 111
of the British North America Act the Dominion of Canada assumed
liability for the debts of the Province of Canada, it is neither suggested in
the pleadings nor contended in argument before
[Page 183]
us that by the Act of Union of 1840 the Province of Canada
became liable for liabilities of the Province of Upper Canada of the nature
suggested.
As to the claim advanced in respect of the amount of
$160,000 or part of it, said to have been expended out of the funds of the Six
Nations Indians by the Province of Canada for the purchase of Grand River
Navigation Company stock, and the claim for interest, I think there is error in
the judgment appealed from.
By paragraph 13 of the Petition of Right, it is alleged that
on February 5, 1798, Captain Joseph Brant, acting under a Power of Attorney
from certain chiefs of what were then the Five Nations Indians, in pursuance of
arrangements made with the Government of Upper Canada, executed a formal
surrender to the Crown of "the lands to be sold." When asked for
particulars as to the nature of the deed of surrender, the suppliants delivered
a copy of the grant which disclosed that the request advanced on behalf of the
Five Nations Indians was that the surrender of 352,707 acres of land be
accepted for the sole purpose of enabling His Majesty to grant the lands to
certain named purchasers for the consideration stated in a schedule to the
document. The consideration for the purchase which aggregated an amount in
excess of £42,000 was not to be paid to the Crown but to the Acting
Surveyor-General, the Superintendent of Indian Affairs for the District, and
Alexander Stewart, Esq., described in a letter from the Honourable Peter
Russell, President of the Executive Council of Upper Canada to the Duke of
Portland, Secretary for the Colonies dated February 20,1798, as the persons
named by the Five Nations as "their trustees to receive for their use
mortgages and other securities for the payment to them of the several and
respective considerations stipulated." By paragraph 14 the suppliants
alleged that as a result of the negotiations between Brant and the Provincial
Government of Upper Canada an agreement was entered into whereby the Government
was to take charge of and sell the lands and receive the purchase money and
hold the same intact for the benefit of the suppliants' ancestors separate and
distinct from the public money of the Province for the purpose of providing
revenue for the support of the Five Nations.
[Page 184]
By paragraph 15 it is alleged that:—
In or about the year 1833 the Government of Upper Canada,
depositary and in control of the funds arising from the sale of Six Nation
lands, of which a very considerable amount was then in the custody and control
of the Receiver-General in said Government charged with the duty of selling
lands belonging to Suppliants, and receiving the funds arising from such sales
and disbursing the same under the contractual agreement made between Joseph
Brant aforesaid and the Government of the Province of Upper Canada under which
said Government was to hold the proceeds of such lands for the purpose of
assuring to your Suppliants and their posterity an annuity for their future
support, in despite of the terms of said contractual agreement aforesaid,
contracted to purchase in the name of your Suppliants, but without their
knowledge or consent, 6,121 shares of $25 each of the stock of the Grand River
Navigation Company, and said Government of Upper Canada, through the said
Receiver General of its Government and subsequently the Government of Canada
after the Union of 1841, paid without further authority out of collections made
and arising from said sales of lands authorized and directed to be made by the
terms of said contractual agreement with said Brant, the sum of $160,000 from
the proceeds of such sales so illegally contracted for without authority to be
purchased by him in the name of your Suppliants to complete the payment for
such shares, and Suppliants charge that said payment was made in breach of the
contractual agreement to hold the whole of said proceeds of sales for the
support of your Suppliants or their ancestors as occasion might arise.
and by paragraph 16 the suppliants asked that the said
sum should be restored with interest to the funds held by the Department of
Indian Affairs and the present Government of Canada "on which is binding
and effective the contract founded (sic) by said Brant in 1798." When
asked for particulars as to the identity of the person or persons who made the
various payments out of the various funds upon the purchase of the stock, the
suppliants replied that the information was in the possession of the Indian
Affairs Branch of the Department of Mines and Natural Resources.
As pleading, the language of these paragraphs leaves much to
be desired. Paragraph 15 speaks of the Government of Upper Canada being
"charged with the duty of selling lands belonging to suppliants" and
refers to the funds paid for the Grand River Navigation Company stock as being
paid "out of collections made and arising from said sales of lands"
but without further explanation I think this must be taken to refer to the
lands conveyed to the nominees of the Five Nations Indians under the directions
given by Brant in 1798, and not to the proceeds of the sale of other lands.
While the reference to the
[Page 185]
Power of Attorney given to Brant by the
Five Nations Indians referred to in paragraph 13 shows that the lands in
question were surrendered simply for the purpose of permitting grants to be made
to the persons to whom the Indians desired the lands to be sold and the
particulars of the deed of surrender show that the consideration for the
purchase was to be paid over to the individuals named by the Indians as
trustees and these persons are referred to in the communication from Peter
Russell to the Secretary for the Colonies as the "trustees to receive for
their use mortgages and other securities for the payment to them of the several
and respective considerations stipulated" and the pleading does not allege
that these trustees thereafter paid over the consideration to the Crown to be
held on behalf of the Indians, I think when these paragraphs are read together
it is made sufficiently clear that the suppliants claim that the funds realized
from the sale came into the possession of the Crown and were held on behalf of
the Indians. The identity of the trustees, named, two of whom were the
Honourable David William Smith, His Majesty's Acting Surveyor General, and
Captain William Claus, His Majesty's Deputy Superintendent of Indian Affairs,
and the fact that by c. 74 of the Statutes of the First Parliament of the
Province of Canada (4 & 5 Vict.) it was recited that three-quarters of the
stock of the Grand River Navigation Company were held in trust for the benefit
of the Six Nations Indians (presumably by the Crown) and it was provided that
the Governor of the Province, by and with the advice and consent of the
Executive Council, might nominate two of the directors of the company, would at
least indicate either that possession of the funds by the trustees had been
treated from the outset as possession by the Crown or that possession of the
funds had thereafter been taken. These are facts which undoubtedly should have
been more clearly pleaded but that this is what the suppliants really contend
is, in my opinion, evident. It is alleged in paragraph 15 that the Government
of Upper Canada contracted to purchase the shares in the Grand River Navigation
Company and that the said Government prior to 1841 and the Government of the
Province of Canada thereafter paid in the aggregate $160,000 out of the moneys
held in trust for the Indians
[Page 186]
upon the purchase of the stock, without saying what amounts
were paid by the respective Governments. It is further in the same paragraph
alleged that the Government of Upper Canada was to hold the proceeds of the
sale of the lands for the purpose of assuring to the suppliants and their
posterity an annuity for their future support and that the moneys paid out for
the Grand River Navigation Company stock were so paid without authority from
the Indians in breach of the agreement between them and the Crown, and in so
far as this relates to the moneys disbursed by the Government of the Province
of Canada I am of the opinion that a cause of action against that Province is
disclosed. While again the pleading is defective, I think the statement in
paragraph 22 (g) that the suppliants rely upon the British
North America Act should here be construed as meaning that it is claimed
that by virtue of section 111 of that Act His Majesty in right of the Dominion
of Canada is liable for the claim as being a debt of the former Province of
Canada, liability for which was imposed upon the Dominion by the Statute, and
that a cause of action in respect of this part of the claim as against the
respondents is shown. Section 111 reads that "Canada shall be liable for
the debts and liabilities of each province existing at the Union." The
question as to whether this gave a right of action directly against the
Dominion in respect of the liability of the province was not raised before us
and is not, in my opinion, one of the questions set down for argument and I
accordingly express no opinion upon the point.
As to the second branch of the question, I am of opinion
that a petition of right lies for the above mentioned part of the relief
claimed and that there is jurisdiction in the Exchequer Court for the reasons
stated by my brother Kellock.
The question as to whether the claim is barred by the Exchequer
Court Act and the Statute of Limitations was not dealt with by the
learned trial judge and was not argued before us and I do not deal with it.
The appeal should be allowed as to the claim advanced in
regard to moneys said to have been paid out by the Province of Canada after the
date of the Union and as
[Page 187]
to the interest upon these moneys, but as to the remainder
of the claims should be dismissed. I agree with the order as to costs proposed
by my brother Kerwin.
Appeal allowed as to the claim advanced in
respect of moneys alleged to have been paid by the old Province of Canada for
the purchase of shares of the Grand River Navigation Co. out of the proceeds of
the sale of lands surrendered in 1798. The costs of an incidental to the
hearing before the Exchequer Court of the question of law shall be costs in the
cause. The costs of this appeal shall be to the appellants in the cause except
in any event they shall not receive any costs of or in connection with their
factums.
Solicitor for the appellants, Auguste
Lemieux.
Solicitor for the respondent, F. P. Varcoe.
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