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RETURN To an Address to His Honour the Lieutenant-Governor, requesting him to lay before the House all… British Columbia. Legislative Assembly 1902

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 2 Ed. 7 Correspondence Respecting Acts of 1901. 753
RETURN
To an address to His Honour the Lieutenant-Governor, requesting him to lay before
the House all correspondence between the Provincial Government, or any
member thereof, and the Federal Government, or any member thereof, with
reference to the Provincial Statutes of 1901, together with any report on the
same.
D. M. EBERTS,
A ttorney- General.
Attorney-General's Office,
26th March, 1902.
Ottawa, 16th September, 1901.
Sir,—I am directed to enclose, for your information and such observations as you may
desire to submit, a copy of a letter from Messrs. Bodwell and Duff, barristers, of Victoria, B.
C, of the 30th ult., seeking disallowance of an Act passed at the last session of the British
Columbia Legislature, being chapter 45, intituled " An Act respecting certain Railway Land
Grants."
I am to state that the Minister will, in reporting upon this measure, be glad to consider
any reply which you desire to make.
There were some enclosures with the letter, but these relate to proceedings in the cause,
and you are doubtless able to refer to them.
I have, etc.,
(Signed)        E. L. Newcombe,
Deputy Minister of Justice.
The Honourable the Attorney-General
of British Columbia, Victoria, B. C.
[Enclosures.]
Victoria, B. C, August 30th 1901.
Sir,—The undersigned, on behalf of the Nelson and Fort Sheppard and the Kaslo and
Slocan Railway Companies, desire to submit the following for your consideration with reference
to an Act passed at the last session of the Legislative Assembly of the Province of British
Columbia, being chapter No. 45, and intituled " An Act respecting Railway Land Grants."
Section 2 of the Act is in the following words :—
" It is hereby declared and enacted that all grants of Crown land heretofore made to
railway companies by the Lieutenant-Governor in Council in aid of or as a subsidy for construction of railways were subject to the reservation of a royalty to the Crown upon all timber
and other wood cut upon lands to be granted by the Crown and with respect to the power
conferred for the enforcement of said royalty."
The Nelson and Fort Sheppard Railway was incorporated by an Act of the Local Legislature, being chapter 38 of the Statutes of 1891. In 1892 an Act was passed providing a
land subsidy in aid of the said railway. It was thereby enacted that it should be lawful for
the Lieutenant-Governor in Council to grant to the Company lands in the electoral district of
West Kootenay, not exceeding 10,240 acres for each mile of the railway. 754 Correspondence Respecting Acts of 1901. 1902
It was known at the time that these lands were not valuable for agricultural purposes.
All minerals were reserved. Except, therefore, as to such portions of them as would be used
for townsites along the railway the value of the concession depended almost entirely upon the
timber which was to be found thereon.
In the year 1888, a section was introduced in the general Land Act of the Province which
was in force at the time of the passage of the Subsidy Act, and which provided that there
should be reserved for the use of the Crown a royalty of fifty cents per thousand feet, board
measure, in respect of all timber suitable for spars, bolts, saw-logs or railroad ties, which should
be cut upon any Crown lands, patented lands, timber leaseholds, timber lands, "and upon any
lands hereafter granted."
In the year 1896 the Land Act was amended by providing that the royalty should apply
to timber used as props for mining purposes, shingle or other bolts of cedar, and a further
royalty of twenty-five (25) cents on every cord of other wood cut upon Crown lands.
In 1893, the Nelson and Fort Sheppard Railway was declared a work for the general
advantage of Canada, and was reincorporated as a Dominion railway, being Chapter 57 of the
Dominion Statutes of 1893. The railway was built under the Dominion Statute, and after
completion, the lands mentioned in the Subsidy Act of the Local Legislature were duly granted
to the Company. Shortly after a question arose as to whether the timber on the lands so
granted was subject to royalty. The Railway Company contended that they were not liable,
and the Government insisted that the timber on such lands was subject to the provisions of
the Land Act. It was proposed by the Company that the question should be settled either
by a reference to the Supreme Court of British Columbia under the "Supreme Court Reference
Act," or by some other form of litigation, and in the meantime an arrangement was entered
into between the Government and the Company in the following words :—
"Victoria, B. C, January 26th, 1897.
"Sir,—Referring to your conference with the Government on the 13th inst., on which
occasion the following arrangement with reference to royalties on timber and cordwood cut
upon the Nelson and Fort Sheppard Railway Company's land grant was agreed upon, viz :—
" 1st.—You are to make monthly returns to the Provincial Timber Inspector at Vancouver,
giving the particulars of timber and cordwood cut by all and every person whatsoever on the
said land grant, and to remit your cheque therewith in payment of royalties thereon.
" 2nd.—The persons actually cutting timber or cordwood under authority from your
Company are also to make returns to the Timber Inspector at Vancouver, monthly, in
accordance with the provisions of the Land Act.
" 3rd—Official receipts will be forwarded to you for all royalties paid, which will contain
a clause that in the event of its being decided that the said royalties are by law not due to
the Crown the moneys so paid will be refunded to you.
" 4th.—The books of your Company, and those of persons cutting timber by your authority,
are to be open to the inspection of Government officers.
"This letter is to confirm the above arrangement, and those persons who have already
paid royalty on such timber will be notified of the purport of this arrangement and advised
that in future the Government look to you to make payments.
" Some printed forms, for returns of timber, have been mailed to your address.
" I have, etc.,
(Signed)        " Geo. B. Martin,
" Chief Commissioner of Lands and Works.
" D. C. Corbin, Esq.,
"President, Nelson and Fort Sheppard Railway Co.,
" Spokane, Wash."
"Spokane, January 29th, 1897.
"Hon. Geo. B. Martin,
" Chief Commissioner of Lands and Works,
" Victoria, B. C.
" Sir,—I acknowledge receipt of your letter of the 26th instant, and have carefully
noted contents. The monthly accounts will be rendered promptly to the Timber Inspector at
Vancouver, as directed, and in the ordinary course he should receive these statements somewhere from the 8th to the 15th of the following month. 2 Ed. 7 Correspondence Respecting Acts of 1901. 755
" My recollection is, that the law applies to lumber and cordwood only. There are certain
other things, such as timber used in mines for stalls and lagging, which I am inclined to think
would be rated by the cord, possibly by the lineal foot. Will you let me know in regard to
this?
" I trust that prompt notification of the arrangements made will be sent to persons who
have paid royalty, so that no misunderstanding may occur, and in order that the business may
proceed smoothly hereafter.
"The blank timber returns have been received.
" Respectfully,
(Signed)        " D. C. Corbin,
"President."
Various delays occurred in bringing the matter before the Courts. In the meantime the
Company went on paying the royalty under the terms of the agreement. Subsequently, the
Government, of which Mr. Martin was Chief Commissioner, was defeated, and by reason of
the many changes in the administration which have taken place in British Columbia since
1898, it was not convenient to get the matter before the Courts, except by some adverse
proceedings against the Government, which the Company were unwilling to institute except as
a last resort.
The Kaslo & Slocan Company was incorporated by a similar Act of the Local Legislature,
and had a land subsidy in the same words as the Nelson & Fort Sheppard Railway Company.
Its undertaking was completed and the lands were granted to the Company.
The capital stock in both companies was subsequently acquired by representatives of the
Great Northern Bailway Company, and from that date the two local roads were operated as a
part of the Great Northern system. The proceedings which afterwards took place with
reference to timber royalties were, by arrangement, carried on in the name of the Kaslo &
Slocan Company, but it was understood that the decision in respect to one railway should
operate as a settlement of the question in so far as both companies were concerned.
On the 27th of June, 1900, the solicitor for the Kaslo & Slocan Company addressed a
communication to the Attorney-General laying the matter before him and requesting that
some action should be taken. No satisfactory reply having been received the solicitors of the
railway Company drafted a petition of right (which is annexed to this communication and
marked as Exhibit "A") and requested that a fiat should be granted. The solicitor for the
Company also came to Victoria and personally interviewed the Attorney-General. He was
informed by that official that the matter would be considered, and that if the Attorney-General
came to the conclusion that the contention of the Company was well-founded there would be
no necessity to go to the expense of a petition of right, as the Government would refund the
money without suit.
Nothing further was heard, however, from the Attorney-General's Department. In
November, one Martin, a Timber Inspector for the district, demanded further payment of
royalties from the Company. This was refused, and the Inspector then seized two of the
Company's engines and took possession of a round-house. The solicitor for the Kaslo Company
was at that time in Arancouver, and he interviewed the Attorney-General and urged a decision
on the question of the application for a petition of right. It was explained that it had not
been possible to bring the matter to the attention of the Premier, but a decision was promised
in ten days. The Company waited for twenty-seven days, and having then received no reply
from the Attorney-General's Department, issued a writ for trespass against the Inspector,
personally. The statement of claim in the action was delivered on the 8th of January, 1901.
Ten days later an application was made to the Judge to extend the time for defence, on the
ground that it was necessary to consult the Attorney-General. The extension of time was
granted. A defence, prepared by the Attorney-General's Department, was delivered on the
8th of March, 1901. (Annexed hereto and marked Exhibits "B" and "C" are the statement
of claim and the statement of defence as originally filed.)
The Local Legislature convened on the 21st of February, 1901. On the 2nd of March,
1901, Bill No. 7, introduced by the Attorney-General, and which subsequently became the
Act referred to in the first part of this letter, was read the first time. While this Bill was on
the Order Paper for second reading, the following correspondence took place between the firm 756 Correspondence Respecting Acts of 1901. 1902
of Bodwell & Duff, representing the Nelson & Fort Sheppard Railway (and who were acting
in conjunction with the solicitor for the Kaslo & Slocan Railway), and the Attorney-General:—
"Victoria, B. C, March 6th, 1901.
" Sir,—Our attention has been called to Bill No. 7, introduced by you, which amounts in
fact to a declaration that the land subsidies given to the Nelson & Fort Sheppard Railway
Company and the Kaslo & Slocan Railway Company were always subject to the provisions of
the Land Act respecting timber royalty.
" As you are aware, for some years past we have been endeavouring to get this matter
before the Courts in the form of a case stated, for the opinion of the Court as to the construction of the various land subsidy Acts. As we were unable to get the matter brought before
the Courts in that way, the Kaslo & Slocan Railway Company, a short time ago, refused to
pay certain timber dues, in consequence of which one of the officials of the Government seized
certain property of the Company, and we brought an action against him for such act, in which
the question of the construction of these Acts will come up for the consideration of the Court.
It was well understood between the Government and us at the time that this was to be a test
action, and the circumstances were arranged so that the interpretation of the Act might be the
subject of a decision of the Court. In that condition of things, it certainly seems surprising
that the Legislature should now attempt to interfere with this matter, and by an ex post facto
law put a construction on the subsidy Acts which may be different from that which the Court
will pronounce when the matter comes before it. You must know that very little value
attaches to these land grants outside of the timber which is upon them, and that when the
various Acts went through there was no question in the minds of any of the parties to the
transaction but that the railway Companies were obtaining the unrestricted right to the timber
on these lands. It was a matter of considerable surprise to them when the Government first
proposed to collect the royalty, and at the instructions of the Nelson & Fort Sheppard we
immediately applied to you, when you were formerly Attorney-General, for the purpose of
having a case stated in order to test the position. This, however, you did not see your way to
do, and as the Company did not wish to be involved in direct litigation with the Government,
and as it was thought that matters might be arranged later on, we went on paying the royalty
under protest, and with the idea of eventually testing the question in the manner we have
indicated above.
" If it should be that our contention is correct, and that this timber belongs to the
Companies, you will see that the present Act is in the nature of a confiscation by legislative
declaration of a property which has been given to the different railways for the purpose of
assisting their undertaking. We are sure that the Government would not propose any legislation of this kind, and we are bound to assume that the Bill has been introduced by you under
some misapprehension as to the actual facts of the case, and on behalf of the Nelson & Fort
Sheppard Railway Company and the Kaslo & Slocan Railway Company, for whom we are
acting, we have the honour to request that the Government will consider this phase of the case
before putting the Bill through the House, and make such amendments as will be necessary to
protect the rights of the parties, if any.
"In this connection we may mention that a few days ago we addressed a letter to the
Chief Commissioner of Lands and Works on this very subject, requesting him to arrange a
scheme by which purchasers from us could take the timber free of royalty, we agreeing to give
security that in case the decision of the action now pending should support the Government's
contention, all royalties on timber cut in the meantime would be paid.
" We have, etc.,
(Signed)        " Bodwell & Duff.
" To the Honourable the Attorney-General,
" Victoria, B. G."
" Victoria, B. C, March 7th, 1901.
"Re Nelson & Ft. S. Ry. Lands.
" Sirs,—I herewith enclose copy of an official communication which I have sent to the
Provincial Secretary.
" I have, etc.,
(Signed)        " E. V. Bodwell.
" To the Honourable the Attorney-General,
" Victoria, B. C." 2 Ed. 7 Correspondence Respecting Acts of 1901. 757
[Enclosure.] " Victoria, B. C, March 7th, 1901.
" Re Timber Royalties on Nelson & Ft.  S. Ry. Lands.
" Sir,—Referring to the verbal interview which I had with the Government yesterday, I
beg to inform you that I have, since returning to my office, looked up the correspondence in
this matter as far as possible, and I find that in January, 1897, Mr. Corbin and the Timber
Inspector, who was acting under instructions from the Government as our letters from them
show, entered into an arrangement by which the Nelson & Fort Sheppard Railway Company
should collect the timber dues and hand over to the Government the proportion which the
Government claimed, it being understood, however, that the matter was to be brought before
the Courts, and that a refund of the money should be made by the Government if it were
thereafter decided that the lands were not subject to royalties. The original document containing this agreement was forwarded by us to the Attorney-General's Department some time
about the 15th or 16th of January, 1897, and will be found on record there ; so that all
collections made by the Nelson & Fort Sheppard and all payments have been subject to the
arrangement. I also enclose a copy of an official communication signed by Mr. Martin, as
Chief Commissioner of Lands and Works, which was forwarded to Mr. Corbin in pursuance of
the understanding to which I have referred, and which shows clearly the terms upon which
the money was paid.
" I am sending a copy of this letter to the Attorney-General.
" I have, etc.,
(Signed)        " E. V. Bodwell.
" To the Honourable the Provincial Secretary,
" Victoria, B. C."
Note—The enclosure in the above letter was copy of letter addressed to Mr. D. C. Corbin
by the Chief Commissioner of Lands and Works, dated January 26th, 1897, which is found on
page 2 of this communication.
"Victoria, B.C., March 7th, 1901.
Re Timber Dues, Nelson & Ft. S. Lands.
" Sir,—We enclose copies of some correspondence in this matter which we had with you
and Mr. Corbin. If you will follow this line in your office you will see that there was a clear
arrangement made with us as to the question how the liability of the Nelson & Ft. Sheppard
Railway was to be settled, and also that, in collecting the timber dues, that Company was
doing so under a well-understood arrangement with the Government.
" We have, etc.,
(Signed)       "Bodwell & Duff.
" To the Honourable the Attorney-General,
" Victoria, B. C."
[Enclosures.] "7th March, 1901.
" Sirs,—I have the honour to acknowledge receipt of your communication of the 6th
instant, respecting the Bill introduced by me, declaring that the lands granted to railway
companies by the Lieutenant-Governor in Council in aid of the construction of certain railways
in this Province have always been subject to the provisions of the ' Land Act' reserving a
royalty to the Crown upon timber.
It never was the intention of the Government, or the Legislature, to exempt railway aid
lands from the timber royalty clauses of the ' Land Act.' The Government have always taken
the position that this royalty should be paid, and from time to time have taken stringent
measures to enforce payment. In my opinion, a fair construction of these subsidy Acts leads
to the conclusion that these lands are subject to timber royalty, as on all other lands granted
by the Crown since the year 1888. Any other construction would defeat the intention of
the Legislature, and the Crown would be deprived of an important source of revenue.
" I consider it quite proper for the Legislature to reform the Acts authorising railway
subsidies, so that there will be no room whatever for doubt about the reservation of this
royalty.
"You state that it was well understood between the Government and your firm that the
action of the Kaslo & Slocan Railway Company against J. R. Martin, one of the Government 758 Correspondence Respecting Acts of 1901. 1902
collectors of timber royalty, was instituted as a test case. If by this statement you mean that
the Government authorised or encouraged, or was in any way a party to, the bringing of this
action, I must say I do not know on what it is based. I received no intimation from any
source that this railway company contemplated proceedings against Mr. Martin. My first
knowledge of the case was derived from a letter received at this Department on the 3rd of
January of this year from the Provincial Timber Inspector, enclosing a copy of the writ served
on Mr. Martin.
"I have, etc.,
(Signed)        " D. M. Eberts,
" Messrs. Bodwell & Duff, " Attorney-General.
"Barristers, Victoria, B. G."
"Victoria, B. C, March 7th, 1901.
" Re Timber Dues on Kaslo & Slocan and Nelson & Ft. Sheppard Lands.
" Sir,—We have the honour to acknowledge receipt of your letter of the 7th of March,
1901.
" We cannot assent to the proposition that, because the Government have always taken
the position that these lands were subject to timber dues, therefore the present Act is a proper
one to bring in. You must agree that the question is one to be decided by an interpretation
of the former subsidy Acts, and that, as the matter is now pending in the Courts, it is most
improper to forestall the decision by a piece of legislation which gives an interpretation to
these Acts at this date. The question, we think, is one of contract between the companies
constructing the railways and the Government. In consideration of that construction the
Government promised certain things ; that promise was put into writing in the form of an
Act, which was passed by the Legislature—on the faith of that Act the railway was built, and
full consideration for the contract paid by the companies in that way. The suggestion now is
that, by the present legislation, an interpretation is to be put upon that contract which may
be different from the construction which the Courts will place upon the Act in question. The
intention of the parties must, like every other question in a matter of this kind, be determined
by the language which they have used; the ideas which the parties had outside of the
language of the statute cannot now be taken into consideration, even if we could agree on that
point, which is impossible. From our knowledge of the situation as solicitors for the Nelson
& Ft. Sheppard Railway Company, we know that the Company has always contended that the
intention was that they should receive the timber free of dues, otherwise, as we have already
pointed out, the land grant was of very little value. The Government also should remember
that land grant bonds have been sold to innocent parties on the faith of this transaction, and
upon the construction which their solicitors advised them would be placed upon the subsidy
Acts in question. Surely it needs no argument on our part to convince you that to change
this position now is most improper. The companies, of course, must take the Act as it reads,
and if your contention is correct the Courts will hold that the timber dues are payable by
them, but, if the Court should hold otherwise, you surely must agree that it is little short of
confiscation of property to pass an Act now which would compel the Court to construe the
Act according to your contention.
" We hope that you will be able to see the force of these views and comply with our
suggestion to make such amendments as will protect whatever rights are already vested in the
companies who have obtained lands under the subsidy Acts to which we have referred.
"We have, etc.,
(Signed)        "Bodwell & Duff.
" To the Honourable the Attorney-General,
" Victoria, B. C."
Notwithstanding the protests above referred to, the Bill above mentioned passed third
reading, and was assented to with the other Acts of the session.
On the 30th April, 1901, a further defence was delivered in the action then pending in
the Supreme Court of British Columbia against Inspector Martin in the following words :—
" 1. Since the defendant delivered his statement of defence herein, an Act intituled 'An
Act respecting certain Railway Land Grants' was, on the 25th day of April, A.D. 1901,
enacted by the Legislature of the Province of British Columbia, whereby it is declared and
enacted that all grants of Crown lands made prior to the passing of the said Act to railway 2 Ed. 7 Correspondence Respecting Acts of 1901. 759
companies by the Lieutenant-Governor in Council in aid of or as a subsidy for construction of
railways, were subject to the provisions of the Land Act with respect to the reservation of a
royalty to the Crown upon all timber and other wood cut upon lands to be granted by the
Crown, and with respect to the power conferred for the enforcement of said royalty, and that
said grants of land were subject to said provisions as from time to time amended and
re-enacted, and are subject to said provisions as they appear in the Land Act and its amendments now in force."
The bonds which were issued for the construction of the Nelson & Fort Sheppard Railway
were secured on the land grant as well as on the earnings of the road. A part of these bonds
have been retired by the use of proceeds on the sale of lands. There is now outstanding in
the hands of bona, fide holders bonds to the extent of $1,293,000.00. The road has never
earned more than its operating expenses, and the undertaking could not be sold on its merits
for a sum sufficient to pay the outstanding bonds, and except for the land grant the bonds are
of very little value.
There is not to exceed 30,000 acres of agricultural land in the whole grant; the balance
of the land is mountainous, rocky and worthless except for the timber upon it. It is estimated
that there is about five hundred million feet of lumber upon the unsold portion as well as
many thousands cords of wood. The value of the grant is diminished by the amount of
royalty chargeable upon the timber and wood as above.
The Kaslo & Slocan Railway also is bonded and its securities are in the hands of bona
fide holders. As in the ca.se of the Nelson & Fort Sheppard Railway their value is dependent
almost entirely upon the land grant. The amount of agricultural land is small, but there are
many million feet of timber suitable for ordinary purposes and many thousand cords of wood.
We have the honour to request that you will consider whether the Act above referred to—
namely, chapter 45 of the Acts of last session of the local Legislature of British Columbia—
should not be disallowed on the ground that it has prevented a decision of the Courts upon a
question materially affecting Dominion interests. The Nelson & Fort Sheppard is a Dominion
railway; it has been built and put into operation by money advanced upon securities which
were issued upon the assumption that the lands in question were valuable for the reason that
the timber upon them was not subject to royalty. The ground upon which that contention
is based is, shortly, that the Land Act referred only to grants made by the Crown in the
ordinary course of the administration of public lands, whereas the lands in question were
granted to the railway company in pursuance of special legislation, and it was not intended
that the ordinary provisions of the Land Act should apply. Since, therefore, the special Act
under which the lands were granted made no reservation of timber royalties the contention is
that they could not be subject to that duty by reason of the language of the general Land
Act. It will be noticed, also, that the Act passed at the last session of the Legislature,
against which we are now complaining, subjects the lands to duty upon props for mining purposes, shingle or other bolts of cedar, and twenty-five cents a cord for all other wood. These
provisions were not in force at the time the Subsidy Act was passed, but only became law in
the year 1896, long after the railway was built and in operation. It is contended that it never
could have been the intention of the railway company or the Legislature to subject the lands
in question to the provisions of the general law, which, as already seen above, is being amended
from time to time with reference to timber upon ordinary ungranted lands of the Crown.
It is submitted that it would be improper to permit the local Legislature to deal with
the securities of a Dominion railway in the manner above referred to. If the principle is
admitted that, after a railway has become subject to Dominion control, its assets can be
impaired, to the detriment of the holders of its securities, at the will of the local Legislature,
it is possible to conceive of a case in which the undertaking would be completely destroyed by
the caprice of the local authority, although it had been declared a work for the general
advantage of Canada and should be maintained accordingly.
It is clear that the matter in question was the subject of a bona fide dispute, and that the
Government agreed that it should be submitted to the Courts for consideration. The efforts
of the company to have the matter adjudicated upon in a friendly manner were counteracted
by the delays interposed by the Government and the inattention of the Attorney-General's
Department, and the companies were driven at the last to enforce their rights in an ordinary
action of trespass against a Government official. While the action was pending in the Courts,
the Legislature passed a special Act forestalling the decision, and preventing the company
from obtaining a judicial construction of the contract upon which they had built the railway. 760 Correspondence Respecting Acts of 1901. 1902
The amount involved is very large and entails serious consequences upon the company.
We have the honour, therefore, to request that the matter may receive the attention of the
Executive, and, if it is in accordance with the usual practice, the company request that they
may be further heard verbally before the Governor in Council at a time and place which
may be appointed for that purpose.
We have the honour to be, etc.,
(Signed)    Bodwell & Duff.
To the Hon. the Minister of Justice,
Ottawa, Ont.
Victoria, B. C, 20th December, 1901.
The Honourable David Mills, K. C,
Minister of Justice, Ottawa, Ont.
Sir,—I have the honour to acknowledge receipt of a letter bearing date the 16th December
last from your deputy, enclosing copy of certain correspondence addressed to you by Messrs.
Bodwell & Duff, barristers, of this City, urging the disallowance by the Dominion Executive
of an Act passed at the last session of the British Columbia Legislature, being Chapter 45 of
the Statutes of 1901, and being intituled " An Act respecting certain Railway Land Grants."
The disallowance of the Act is sought on the ground that it will compel the Nelson and Fort
Sheppard Railway Company and the Kaslo and Slocan Railway Company to pay to the
Government of British Columbia a royalty upon timber cut upon the lands granted to said
Companies by the Government in aid of the construction of said railways. The railway Companies in question were incorporated by special Acts of the Legislature of the Province, and
by other Acts the Lieutenant-Governor in Council was empowered to grant to the Companies
certain lands as an aid towards the construction of said railways. I am personally aware of
the facts in connection with the grant of said aid, and I know it was the intention of the
Legislature that the lands so granted should be subject to the land laws of the Province
respecting royalty upon timber. It may be that the intention of the Legislature was not
expressed as clearly as it might have been expressed, and, therefore, upon a narrow construction
of the said Acts by the Courts the Government might lose an important source of revenue from
the lands of these Companies. This is a purely local and domestic matter, to be dealt with by
this Legislature. It is essentially a question of the exemption of the timber products of certain
railway aid lands from a species of taxation in view of the way in which the royalty is reserved
or imposed, and from time to time changed by the Legislature. If this Legislature has no
doubt about its intention, it seems to me it is quite proper for it to reform the terms in which
that intention is expressed, so as to render it impossible for the Companies to take more than
they should receive.
In this connection permit me to draw your attention to sub-section (41) of section 10 of
Chapter 1 of the Revised Statutes of this Province, intituled the " Interpretation Act of
British Columbia."    That sub-section is as follows :—
" Every Act shall be so construed as to reserve to the Legislature the power of repealing
or amending it, and of revoking, restricting or modifying any power, privilege or advantage
thereby vested in or granted to any person or party whenever such repeal, amendment,
revocation, restriction or modification is deemed by the Legislature to be required for the
public good."
You will therefore see that the Legislature has merely exercised a reserved power, which
is as much a term of the said aid Acts as if it were expressly embodied therein.
I would also observe that any interference with the impugned legislation would have a
most disastrous effect upon the revenues of the Province, as thereby the Government would be
deprived of the great bulk of the royalty upon timber at present received, which constitutes a
very considerable portion of the income of the Province.
Messrs. Bodwell <fc Duff also seek your intervention on the ground that in 1893 a Dominion
corporation called the Nelson and Fort Sheppard Railway Company was created by Chapter
57 of the Dominion Statutes of that year, and the said railway declared to be for the benefit
of Canada. With that Dominion corporation the Legislature of British Columbia has nothing
whatever to do. The bonus was given to a Provincial corporation. The Provincial corporation
is an entirely different legal entity from the Dominion corporation.    This is a royalty reserved 2 Ed. 7 Correspondence Respecting Acts of 1901. 761
in respect of lands granted by the Province to a Company, and with respect to which lands
the Dominion has not legislated at all. The fact of the Dominion declaring the railway to be
for the general advantage of Canada would regulate the corporation's status quo railway and
possibly the lands included in the right-of-way, but would not prevent the Province from
taxing those lands by way of royalty, or in any other way, or from moulding in any manner it
deems for the public good the aid the Company shall receive. Even if we are now dealing
with a Dominion corporation the Legislature of this Province is certainly acting within the
compass of its powers when it reforms one of its own Acts. You may say you do not approve
of the policy of the amending Act, and therefore you will disallow it although it is intra vires.
In my opinion the power to disallow intra vires legislation is a power which should be
sparingly exercised. In this case the Legislature has considered all the correspondence, facts
and arguments submitted to you as a ground for disallowing the Act, and it has deliberately
decided that it is for the public good that the Act should be on the Statute book.
It seems to me the Dominion Executive should not nullify the action of a Provincial
Legislature acting within its powers, except where it runs counter to some general public
policy or to the legislation of the Dominion. The Dominion, apparently for reasons affecting
Canada as a part of the Empire, has adopted as its policy that Japanese shall be allowed to
enter Canada on the same terms as other foreigners. To carry out its policy it has deemed it
necessary to disallow the " British Columbia Immigration Act, 1900." Although I disapprove
of this particular exercise of the disallowance power, yet I can understand that the Dominion
Executive have overridden the intra vires legislation of this Province pursuant to the dictates
of what they have established as the public policy of Canada.
Should the Dominion Parliament enact an insolvency law, I would consider it a proper
exercise of this power to disallow any Provincial statute which, although clearly intra vires,
would interfere with the operation of the Federal legislation.
In the early days of Confederation, the Dominion Executive appear to have been imbued
with the notion that the relation between the Dominion and the Provinces was analogous to
that existing between parent and child, and to have acted accordingly. That view of the
status of the Provinces has been overthrown by a series of Imperial Privy Council decisions,
which have clearly established that the Provinces, acting within the scope of their powers, are
almost sovereign states, and that they are entitled to exercise all the prerogatives of the Crown
not conferred upon the Dominion. The logical conclusion from these decisions is that the
disallowance power is improperly exercised except in the cases I have above mentioned. Of
late years the Dominion Executive appear to have adopted this view. Although very strong
arguments were advanced for the disallowance of the "Jesuits' Estates Act," yet the power
was not exercised.
By chapter 13 of the Statutes of 1888 the Legislature of Manitoba enacted and declared
that an agreement for public printing between Her Majesty the Queen and Edward Trudel
was to be deemed cancelled as of the first day of February, 1888, and that there should be no
claim against Her Majesty for damages or otherwise in connection with said agreement for
any matter after said first day of February. A petition was presented to His Excellency the
Governor-General, praying that said Act should be disallowed as being an invasion of a
contractual right.    In that case, also, the Dominion authorities declined to interfere.
I therefore most respectfully submit that the legislation complained of by the solicitors
for the above-mentioned railway companies should not be disallowed by His Excellency the
Governor-General in Council.
I have, etc.,
(Signed)        D. M. Eberts,
A ttorney-General.
25th September, 1901.
The Committee of the Privy Council have had under consideration a Report, hereto
annexed, from the Minister of Justice, dated 19th September, 1901, in regard to chapter 73 of
the Acts of the Legislative Assembly of the Province of British Columbia, passed in the first
year of His Majesty's reign (1901), intituled "An Act to incorporate the Crow's Nest Southern
Railway Company." 762 Correspondence Respecting Acts of 1901. 1902
The Committee concur in the said annexed   Report and  the recommendations therein
made, and advise that the said statute be left to such operation as it may have; and that a
certified copy of this Minute and the said Report be transmitted to the Lieutenant-Governor
of British Columbia and to the President of the said railway company for their information.
All which is respectfully submitted for His Excellency's approval.
(Signed)        John J. McGee,
Clerk of the Privy Council.
His Honour
The Lieutenant-Governor of British Columbia.
Department of Justice, Canada,
Ottawa, 19th September, 1901.
To His Excellency the Governor-General in Council :—
The undersigned has had under consideration Chapter 73 of the Acts of the Legislative
Assembly of the Province of British Columbia, passed in the first year of His Majesty's reign
(1901), intituled "An Act to incorporate the Crow's Nest Southern Railway Company."
The Company so incorporated is by the terms of the Act authorised, among other things,
to construct and operate a line of railway from Michel, in the said Province, to a point therein
at or near the International Boundary ; also from that line to a point within the Province at or
near the easterly boundary thereof, and thence again by the route described in the statute to
another point upon the easterly boundary of the Province. The Act thus professes to confer
authority upon the Company to construct and operate railways connecting a point upon the
boundary between British Columbia and the United States with two points upon the boundary
between British Columbia and the North-West Territories. The power of a Provincial Legislature to authorise such works depends first upon the question whether these lines of railway ought
to be regarded as local works or undertakings, and if so, secondly, whether they are not within
the exception to Provincial jurisdiction over local works and undertakings defined as " lines
of steam or other ships, railways, canals, telegraphs and other works and undertakings connecting the Province with any other or others of the Provinces, or extending beyond the
limits of the Province," and thirdly, whether upon the fair construction of all the provisions of
sections 91 and 92 of the British North America Act, a Provincial Legislature can be held to
have authority to provide for the construction and operation of railways running through the
Province and connecting the United States with the Province and other portions of the
Dominion. It would seem to be certain if the lines of railway in question occupied the same
relation to two Provinces of the Dominion which they do to the United States and the North-
West Territories that the Act would be ultra vires, but the United States is a foreign country
and the North-West Territories are not a Province, so that these undertakings do not fall
within the letter of the express exception above quoted unless they may be said to extend
beyond the limits of the Province. It is doubtful, however, whether works making such
connection can be considered local in their character, and, therefore, within the power conferred.
It is to be observed that Parliament has been given exclusive power to legislate with regard to
ferries between a Province and any British or foreign country, or between two Provinces, that
lines of steamships between any British or foreign country are excepted from Provincial
powers, and having regard to the intention and scope of the sections defining the respective
authority of Parliament and the Legislatures it would seem to be anomalous that a legislature
should authorise the construction of lines of railway such as those in question.
Similar objections have heretofore been stated with regard to Provincial railways touching
the International or Provincial boundaries, but it has not been considered in such cases that
the public interest demanded disallowance, because of the facilities afforded for raising these
questions in the Court where they may be judicially determined.
Section 23 of the Act provides that "no aliens shall be employed on the railway during
construction unless it be demonstrated to the satisfaction of the Lieutenant-Governor in
Council that the work cannot be proceeded with without the employment of such aliens."
This provision is manifestly ultra vires and therefore harmless, and inasmuch as the
undersigned has come to the conclusion that he ought not to recommend disallowance for the
other reasons stated in this report he does not consider it expedient to do so, because of the
obvious invalidity of this provision relating to aliens. 2 Ed. 7 Correspondence Respecting Acts of 1901. 763
The undersigned recommends, therefore, that the statute be left to such operation as it
may have, and that a copy of this report, if approved, be transmitted to the Lieutenant-
Governor of British Columbia and to the President of the said Company for their information.
Respectfully submitted,
(Signed)        David Mills,
Minister of Justice.
Extract from a Report of the Committee of the Honourable the Privy Council, approved by
His Excellency on the 17th January, 1902.
The Committee of the Privy Council have had under consideration a Report, hereto
annexed, from the Minister of Justice, respecting certain Statutes of British Columbia,
passed in the first year of His Majesty's reign (1901), viz : Chapters 32, 65, 69, 70, 71, 72,
77, 78, 79, 81, 83, 84, 85, 87, 68, 80, 86.
The Committee concur in the said Report, and the observations and recommendations
therein made, and advise that a certified copy of this Minute and the annexed Report, if
approved, be transmitted to the Lieutenant-Governor of British Columbia, with a request that
he inform the Government of Canada, as soon as convenient, whether these Acts will be
amended within the time limited for disallowance, by repealing the clauses affecting aliens,
and, further, as to the legislation respecting the Victoria Terminal Railway and Ferry Company, by reforming the by-law and agreement therein referred to so as to do away with the
provisions relating to Japanese.
(Signed)       John J. McGee,
Clerk of the Privy Council.
His Honour
The Lieutenant-Governor of the Province of British Columbia.
Department of Justice, Canada,
Ottawa, 27th December, 1901.
British Columbia Legislation, 1901.
To His Excellency
The Governor-General in Council:
The undersigned has had under consideration the following Statutes of British Columbia,
passed in the first year of His Majesty's reign (1901), viz.:
Chapter 32.—" An Act to authorise the loan of five million dollars for the purpose of
aiding the construction of railways and other public works."
Section 10 of this Act authorises the Lieutenant-Governor in Council to enter into
agreements with any person or company undertaking the construction of any railway to which
a subsidy is hereby attached, which may be necessary or convenient for the due construction
and operation of such railway, which agreements shall, in every instance, in addition to other
matters therein provided for, contain the provisions set forth in the said section. These
include, among others, the following :—
" (e.) That the Lieutenant-Governor in Council shall have absolute control of the freight
and passenger rates to be charged by the railway, and that, notwithstanding and in the event
of the railway being or becoming subject to the jurisdiction of the Dominion Government,
the same shall be assumed by the company, and shall be deemed a contract between the
Province and the company."
"(1.) That no aliens shall be employed on the railway during construction, unless it is
demonstrated to the satisfaction of the Lieutenant-Governor in Council that the work cannot
be proceeded with without the employment of such aliens."
Chapter 65.—"An Act to amend the 'Arrowhead and Kootenay Railway Company Act,
1898.'"
Chapter 69.—"An Act to incorporate the Coast-Kootenay Railway Company, Limited."
Chapter 70.—" An Act to amend the ' Columbia and Western Railway Company Act,
1898.'" 764 Correspondence Respecting Acts of 1901. 1902
Chapter 71.—"An Act to incorporate the Comox and Cape Scott Railway Company.' "
Chapter 72.—" An Act to incorporate the Crawford Bay Railway Company."
Chapter 77.—"An Act to incorporate the Imperial Pacific Railway Company."
Chapter 78.—"An Act to incorporate the Kamloops and Atlin Railway Company."
Chapter 79.—" An Act to incorporate the Kootenay Central Railway Company."
Chapter 81.—"An Act to incorporate the Midway and Vernon Railway Company."
Chapter 83.—"An Act to incorporate the Queen Charlotte Islands Railway Company."
Chapter 84.—" An Act to incorporate the  Vancouver and Grand Forks Railway  Company."
Chapter 85.—" An Act to incorporate the Victoria Terminal Railway and Ferry Company "; and
Chapter 87. — "An Act to incorporate the Yale-Northern Railway Company."
Each of these Statutes contains a provision in effect that no aliens shall be employed on
the railway during construction unless it is demonstrated to the satisfaction of the Lieutenant-
Governor in Council, that the work cannot be proceeded with without the employment of such
aliens. Each of these Statutes contains the further provision that the Act shall not come into
force and effect until such time as the Company shall give security to the satisfaction of the
Lieutenant-Governor in Council.
" (1.) That the Lieutenant-Governor in Council shall have the right from time to time to
fix the maximum rates for freight and passanger traffic, and the Company shall not charge
rates higher than those fixed.
"(2.) That in the event of Dominion legislation bringing this Railway Company under
the exclusive jurisdiction of the Parliament of Canada, the foregoing conditions shall be carried
out by the Company so incorporated, as a contract and obligation of said Company, prior to
any other charge thereon."
Chapter 68.—Intituled " An Act to incorporate the Chilcat and Klehini Railway and
Navigation Company "; and
Chapter 80.—Intituled "An Act to incorporate the Lake Bennett Railway."
Each of these chapters contains the provision above quoted with regard to the security to
be given to the satisfaction of the Lieutenant-Governor in Council regarding the fixing of
maximum rates, but they do not contain the clause with respect to aliens.
Chapter 85.—In addition to the objectionable clauses which have been stated, this Act
contains a provision empowering the Company to adopt and carry into effect the draft agreement recited in and incorporated with a By-law passed by the Municipal Council of the City of
Victoria, copy of which is set forth in the Schedule to the Act. This agreement provides,
among other things, that no Chinese or Japanese person shall be employed on any of the works
or undertakings agreed to be carried out by the Company, or in the operation of such undertaking after construction; and in the event of any such Chinese or Japanese person being so
employed, the Company shall forfeit and pay to the Corporation the sum of $50 per day for
every person so employed.
Chapter 86.—" An Act empowering the Corporation of the City of Victoria to lease the
Market Building Premises and otherwise carry into effect the ' Victoria Terminal Railway
By-law, 1900.'"
This Statute declares that the Victoria Terminal By-law, 1900, which is the By-law
already referred to, was duly passed and shall be absolutely valid and binding upon the
Corporation according to the terms thereof, and the Council is empowered to carry out and
give force and effect to all the provisions, agreements, stipulations and conditions in the said
By-law set forth. The By-law recites the agreement containing the clause with respect to
Chinese or Japanese already mentioned.
Dealing first with the provisions above quoted, with regard to the Lieutenant-Governor in
Council fixing maximum rates for freight and passenger traffic, and what shall happen in the
event of Dominion legislation bringing these railway companies under the exclusive jurisdiction
of Parliament, the undersigned has difficulty in understanding what is intended by the Legislature. The words have already been quoted. They would have to be construed having regard
to the Dominion legislation, whatever it might be, affecting the company, if its railway were
brought under the exclusive jurisdiction of Parliament. In so far as consistently with such
legislation the Provincial Statute incorporating the company might operate, the original
charter would probably remain in operation, and the provision in question would give it no 2 Ed. 7 Correspondence Respecting Acts of 1901. 765
additional effect. In so far, however, as it is attempted to follow these companies into
Dominion jurisdiction, and govern them by Provincial enactment intended to come into effect
after they have passed beyond the authority of the Province, the legislation can, in the opinion
of the undersigned, have no effect.
The undersigned has already stated his views upon such legislation with regard to a
similar clause in the British Columbia Acts of 1899, vide Report of undersigned approved by
Your Excellency on 14th December, 1899. So long as these railways are subject to local
jurisdiction there can be no objection to the clause now in question. It is not necessary to
consider whether or not Parliament is likely to take any action in the matter. It is certain
that, if at any time these railways should fall within the exclusive jurisdiction of Parliament,
previously existing enactments with regard to them can have effect only in so far as Parliament
intends, and, therefore, whatever the construction of these clauses, or the intention of the
Legislature with regard to them may be, it seems to the undersigned harmless so far as
Dominion interests are concerned. The undersigned would not, therefore, recommend disallowance of any of these Acts upon the ground, solely, that they contain the clauses upon
which he has already commented.
The undersigned has received a communication from the Japanese Consul, at Vancouver,
objecting to the clause above quoted with respect to aliens, particularly with regard to the
legislation respecting the Victoria Terminal Railway and Ferry Company, and he points to
the clause respecting the Japanese, contained in the agreement set forth in the above-mentioned
by-law. It is unnecessary for the undersigned to review here the correspondence which has
taken place during the last three years between the Imperial Government, Your Excellency's
Government and the Government of British Columbia with regard to legislation respecting
the Japanese. A number of Statutes have been disallowed, and the Government and Legislature of the Province are well aware of the policy of Your Excellency's Government with
regard to such legislation and the reasons for it. Heretofore exception has been made with
respect to Acts incorporating private companies, because of the inconvenience which might
arise if these Statutes were disallowed after the companies had been organised and commenced
operations; but in the Report of the undersigned, approved 24th April, 1900, to Your Excellency in Council, the undersigned referring to the disallowance of previous Acts of British
Columbia for the same reason, and to the Acts then under review, stated : "Inasmuch, however, as certain Statutes of British Columbia were disallowed in 1899 on account of provisions
attempting to render illegal the employment of Japanese, and as certain other Statutes will,
if this report be approved, soon be disallowed for the same reason, the undersigned considers
that by the time of another session of the Legislature it will be safe to hold that the views of
Her Majesty's Government and of this Government, with regard to anti-Japanese legislation,
are generally and sufficiently understood in British Columbia, and, therefore, it may well be
considered, in case of this objectionable section appearing in future Acts of incorporation, or
Acts affecting private companies, that these Companies' Acts ought not to have exceptional
treatment. The applicants may be held to have obtained the legislation at their own risk, and
persons dealing with corporations incorporated by charters attempting to impose disabilities
upon aliens, may also be held to have acted with notice of the views entertained by Your
Excellency's Government, and of the action which would probably be taken with respect to
such measures."
A copy of this Report was duly communicated to the Provincial Government, and, in the
face of the warning so given, the undersigned does not consider that any further exception
should be made. The statutes now in question contain all the objectionable provisions which
led to the disallowance of the former Acts. The objections are in the present instance more
serious, inasmuch as not only Japanese but all aliens are disqualified from employment to the
extent mentioned in these Acts. The subject of aliens is clearly within the exclusive authority
of Parliament.
Immigration is also within Dominion jurisdiction, and it has been, and is, the policy of
Your Excellency's Government to promote immigration, large sums of money being annually
expended from the Dominion treasury to that end. The efforts of Your Excellency's Government would, however, be certainly paralyzed if the immigrant, upon coming to Canada, is to
find the way of employment closed to him by Provincial legislation. The policy of these
enactments is so contrary to that of Your Excellency's Government, and the enactments themselves so manifestly ultra vires, that the undersigned considers that no course is open to Your
Excellency's Government, consistently with the public interest, but the exercise of the power
of disallowance, unless, indeed, the Provincial Legislature repeal these provisions. 766 Correspondence Respecting Acts of 1901. 1902
The undersigned, therefore, recommends that a copy of this Report, if approved, be transmitted to the Lieutenant-Governor of British Columbia, with a request that he inform Your
Excellency's Government, as soon as convenient, whether these Acts will be amended within
the time limited for disallowance by repealing the clauses affecting aliens, and, further, as to
the legislation respecting the Victoria Terminal Railway and Ferry Company, by reforming
the by-law and agreement therein referred to so as to do away with the provisions relating to
Japanese.
Respectfully submitted,
(Signed)        David Mills,
Minister of Justice.
Extract from a Report of the Committee of the Honourable the Privy Council, approved by His
Excellency on the 25th January, 1902.
The Committee of the Privy Council have had under consideration a Report, hereto
annexed, from the Minister of Justice, respecting the Statutes of the Legislature of the Province of British Columbia passed at the recent session of that Legislature.
The Committee concur in the said Report and the observations and recommendations
therein made, and advise that none of the Acts upon which the Minister of Justice has therein
expressed his opinion be disallowed.
(Signed)       John J. McGee,
Clerk of the Privy Council.
His Honour
The Lieutenant-Governor of the Province of British Cohtmbia.
Department of Justice, Canada,
Ottawa, 31st December, 1901.
Legislation  1901.
To His Excellency the Governor-General in Council:
The undersigned has had under consideration the Statutes of the Legislature of the
Province of British Columbia passed at the recent session of that Legislature, and has the
honour to report thereon as follows :—
1 Edward VII., 1901.
These Acts were received by the Secretary of State for Canada, on 24th June last. A
separate report will be made upon the following chapters :—
Chapter 10.—"An Act to amend the 'Companies Act, 1897.'"
Chapter 25.—"An Act respecting the Fisheries of British Columbia."
Chapter 32.—"An Act to authorise the Loan of $5,000,000 for the purpose of aiding the
construction of Railways and other Public Works."
Chapter 37.—"An Act  to   amend the   'Inspection   of   Metalliferous   Mines   Act'  and
amending Act."
Chapter 46.—"An Act to provide for the collection of a Tax on persons."
Chapter 65.—"An Act to amend 'The Arrowhead and Kootenay Railway Company Act,
1898.'"
Chapter 68.—"An Act to incorporate the Chilcat and Klehini Railway and Navigation
Company."
Chapter 69.—"An Act to incorporate the Coast-Kootenay Railway Company, Limited."
Chapter 70.—"An Act to amend 'The Columbia and Western Railway Company Act,
1896.'"
Chapter 71.—"An Act to incorporate the Comox and Cape Scott Railway Company."
Chapter 72.—"An Act to incorporate the Crawford Bay Railway Company."
Chapter 77.—"An Act to incorporate the Imperial Pacific Railway Company."
Chapter 79.—"An Act to incorparate the Kootenay Central Railway Company."
Chapter 80.—"An Act to incorporate the Lake Bennett Railway." 2 Ed. 7 Correspondence Respecting Acts of 1901. 767
Chapter 81.—"An Act to incorporate the Midway and Vernon Railway Company."
Chapter 83.—"An Act to incorporate the Queen Charlotte Islands Railway Company."
Chapter 84.—"An Act to incorporate the Vancouver and Grand Forks Railway Company."
Chapter 85.—" An Act to incorporate the Victoria Terminal Railway and Ferry Company."
Chapter 86.—"An Act empowering the Corporation of the City of Victoria to lease the
market building premises and otherwise carry into effect the 'Victoria
Terminal Railway By-law, 1900.'"
Chapter 87.—"An Act to incorporate the Yale Northern Railway Company."
Chapter 45.—" An Act respecting certain Land Grants."
This Act recites that under the provisions of certain Statutes of the Province, grants of
land have been made from time to time to railway companies to aid in the construction of
certain railways ; that it was the intention of the Legislature and of the Government that
the said grants should be subject to the provisions of the " Land Act" and its amendments
and re-enactments, reserving to the Crown a royalty upon the timber and other wood, and
conferring powers for the enforcement of the said royalty, and that it is desirable to specifically
provide and declare that the said provisions of the " Land Act" apply to lands granted as
aforesaid.    The Statute proceeds to enact accordingly.
Objection to this Statute has been made by Messrs. Bodwell & Duff, Barristers, of Victoria,
on behalf of the Nelson and Fort Sheppard and Kaslo and Slocan Railway Companies, upon
the grounds set forth in the letter of Messrs. Bodwell & Duff of 30th August last, copy of
which is submitted herewith.
The Deputy Minister of Justice, by direction of the undersigned, communicated this
objection, with the correspondence, to the Attorney-General of British Columbia by letter of
16th September last, copy of which is submitted, together with copy of the reply received from
the Attorney-General. The undersigned does not deem it necessary to consider in detail the
remarks of the Attorney-General. He does not acquiesce in all of them, but the undersigned
bases his refusal to recommend disallowance upon the fact that the application proceeds upon
grounds affecting the substance of the Act with regard to matters undoubtedly within the
legislative authority of the Province and not affecting any matter of Dominion policy. It is
alleged that the Statute affects pending litigation and rights existing under previous legislation and grants from the Province. The undersigned considers that such legislation is objectionable in principle and not justified unless in very exceptionable circumstances, but Your
Excellency's Government is not in anywise responsible for the principle of the legislation, and
as has already been stated in this Report with regard to an Ontario Statute, the proper remedy
in such cases lies with the Legislature or its constitutional Judges.
Chapter 73.—"An Act to incorporate the Crow's Nest Southern Railway Company," has
already been reported upon.     Vide Report of the undersigned approved 25th September last.
Respectfully submitted,
(Signed)        David Mills,
Minister of Justice.
Extract from a Report of the Committee of the Honourable the Privy Council, approved by
His Excellency on the 10th Jamtary, 1902.
On a Report dated 28th December, 1901, from the Minister of Justice, stating that he
has received a communication from Mr. R. F. Tolmie, Secretary of the British Columbia
Mining Association, enclosing a petition, copy herewith, from the British Columbia Mining
Association, praying for the disallowance of chapter 37 of the Statutes of British Columbia,
1901, intituled "An Act to amend the 'Inspection of Metalliferous Mines Act' and Amending Act."
The Minister recommends that a copy of the petition and of this Minute be transmitted
to the Lieutenant-Governor of British Columbia, requesting that his Government express their
views upon the matter for the information of His Excellency's Government.
The Committee submit the foregoing for His Excellency's approval.
(Signed)        John J, McGee,
Clerk of the Privy Council.
His Honour the Lieutenant-Governor,
Province of British Columbia. 768 Correspondence Respecting Acts of 1901. 1902
To His Excellency the Governor-General in Council:
The petition of the British Columbia Mining Association sheweth as follows :—
1. That under and by virtue of the provisions of section 9 of Bill No. 28, entitled "An
Act to amend the Inspection of Metalliferous Mines Act and amending Act," passed at the
last session of the Legislative Assembly of the Province of British Columbia, it is provided :
"General Rule 8, as set forth in section 25 of the said Act, is hereby repealed and the
following substituted therefor: In every mine where hoisting is employed either for the
carriage of persons or minerals, the following code of mine signals should be used." (Here
follows the schedule as set out in the said bill).
2. That this Association took occasion before the passing of said Act by the Legislative
Assembly of British Columbia to protest against the passing of said Bill for the following
reasons, amongst others :—
(a.) That in the opinion of the members of this association no good reason presents itself
for repealing General Rule 8, as set forth in section 25 of the Mines Metalliferous Inspection
Act, being chapter 61, Revised Statutes of British Columbia, and to make the additions provided for in section 9 of the said Bill No. 28 will only lead to confusion, and consequently to
accidents.
(b.) That in the opinion of members of this association—such opinion being based on long
and wide experience—it is impossible to devise by legislation a uniform code of signals
adaptable to all mines without interfering with safety and efficiency.
(c.) That from the many years of mining experience which the members of this association
have had in different parts of the world they are unable to recall any accidents in mines that
would have been prevented by the adoption of a uniform code of signals. In the opinion of
the members of this association the addition to the code provided for by section 9 of said Bill
No. 28 will not in any way increase the safety of operating cages and skips, but on the contrary by their complex nature and undue length they will be so dangerous that their use will
be out of the question, having due regard to the safety of employees.
(d.) That in the absence of any demand being made upon the Government for the changes
in the law contemplated by section 9 of said Bill No. 28, the members of this association are
at a loss to understand why such unworkable conditions should be imposed upon mine
operators, especially in view of the fact that from the experience of the members of this
association no legalised code of mine signals of such an extensive nature as that provided for
in section 9 of Bill No. 28 has been ever found beneficial or tended to the safety of employees.
3. That by section 25 of said Chapter 134, Revised Statutes of British Columbia, it is
provided that " The following general rules shall so far as may be reasonably practicable be
observed in every mine to which this Act applies." In the opinion of the members of this
Association—and they state the same here as a matter of fact based upon long years of
experience, the code of mine signals set out and provided in said section 9 of Bill No. 28 cannot
be observed in the mines to which the said Act applies, as the same are not reasonably
practicable.
Your petitioners therefore pray that, for the reasons above stated, the said Bill No. 28
being "An Act to amend the Inspection of Metalliferous Mines Act and Amending Act" be
disallowed by Your Excellency in Council.
And your petitioners, as in duty bound, will ever pray.
(Signed)       The British Columbia Mining Association,
Per R. F. Tolmie,
General Secretary.
Extract from a Report of the Committee of the Honourable the Privy Council approved by
His Excellency on the 10th January, 1902.
The Committee of the Privy Council have had under consideration a Report, hereto
annexed, from the Minister of Justice, respecting the British Columbia Fisheries Act, 1901,
1 Edward VII., Chapter 25, intituled " An Act respecting the fisheries of British Columbia."
The Minister states in said Report that certain provisions of the Statute now in question
cannot be upheld upon any principle arising out of the proprietary interests of the Province,
or the local control over property and civil rights.      That the authority of the Legislatures is 2 Ed. 7 Correspondence Respecting Acts of 1901. 769
very clearly established by the decision of the Judicial Committee in the fisheries case, and he
considers they should not transgress the limits which have been judicially declared."
The Minister considers that certain sections mentioned in said Report should be either
repealed or amended so that they may not affect or authorise the regulation of the fisheries.
The Minister recommends that a copy of this Minute and the annexed Report be transmitted to the Lieutenant-Governor of British Columbia with a request that he inform the
Government of Canada, as soon as convenient, whether the Act will be so amended within the
time limited for disallowance.
The Committee concur in the said annexed Report and the recommendations therein made,
and advise that a certified copy of this Minute, and the annexed Report, be transmitted to the
Lieutenant-Governor of British Columbia.
All which is respectfully submitted for His Excellency's approval.
(Signed)        John J.  McGee,
Clerk of the Privy  Council.
His Honour the Lieutenant-Governor
Province of British Columbia.
Department of Justice, Canada,
Ottawa, 26th December, 1901.
British Columbia Legislation, 1901.
To His Excellency
The Governor-General in Council.
The undersigned has the honour to submit his Report upon the British Columbia Fisheries
Act, 1901, 1 Edward VII., Chapter 25, intituled " An Act respecting the fisheries of British
Columbia."
It is enacted by section 9 that " The Board of Fishery Commissioners, with the approval
and authority of the Lieutenant-Governor in Council may, from time to time, make regulations
for the better management, conservation and regulation of all fisheries in respect of which the
Legislature of British Columbia has authority to legislate to prevent or remedy the destruction
and pollution of streams, to regulate and prevent fishing, to prevent the destruction of fish,
and to forbid fishing except under the authority of leases or licences, and may from time to
time vary, amend, alter or repeal all and every such regulation as may be found necessary or
deemed expedient for the purpose of carrying the provisions of this Act into effect, and all
regulations so made shall have the same force and effect as if herein contained and enacted,
and every offence against any such regulation may be stated as having been made in contravention of this Act, notwithstanding that such regulations extend, vary or alter any of the
provisions of this Act respecting the places or modes of fishing, or the times specified as
prohibited or close seasons."
Section 12 provides that no person shall fish for, take, catch or kill from or in Provincial
waters, except so far as may be necessary to secure a supply for his own use, by any means
other than angling, any fish which inhabits such waters, without first having obtained a lease
or licence signed by the Commissioners or their deputies.
Section 13 prohibits any person, without lawful excuse, from buying, selling or possessing
any fish caught or killed in Provincial waters at a time or in a manner prohibited by law.
Section 14 authorises the Commissioners to issue fishing leases or licences for fisheries and
fishing to be carried on in Provincial waters; subject always to such regulations, conditions and
restrictions as may from time to time be made, ordered, established or fixed in that behalf by
the Commissioners, approved by the Lieutenant-Governor in Council.
Section 19 empowers the Board of Commissioners to appoint guardians to prevent the
taking or killing of fish by illegal means, or in an illegal manner, or at prohibited times.
Section 27 provides that no fish or fish spawn shall be taken in any manner from Pro
vincial waters for the purpose of stocking, artificial breeding or for scientific purposes, without
a written permit from the Commissioners.
Section 28 requires every person fishing in Provincial waters to permit the inspection and
examination of the fish taken by him or in his possession, and the implements by which the fish
were taken, and authorises search if the person refuses to allow such inspection and examination. 770 Correspondence Respecting Acts of 1901. 1902
Section 32 empowers the Fishery Commissioners to determine where nets may be set, and
the distances to be maintained between each and every location of nets.
Section 33 requires nets to be marked with the name of the owner or owners.
Section 34 authorises the local fishery overseer to determine disputes relative to the
position and use of nets and other fishing apparatus.
Section 36 prohibits common carriers or other persons from having in possession, or
shipping, or transporting any fish caught or killed within the Province, at a time or in a
manner prohibited by law.
Section 53 provides that special licences and leases, for any term of years, may be granted
by the Board of Commissioners to any person who wishes to plant or form oyster beds in any
of the bars, inlets, harbours, creeks or rivers of the Province, and that the holder of any
such lease or licence shall have the exclusive right of the oysters produced or found on the
beds within the limits of such lease or licence.
Section 59 enacts a penalty against any person who shall set up, use or employ any fish-
trap, stationary net, or other device of a like nature, for the taking of salmon, or who shall
take or kill any salmon by any such means in Provincial waters.
It is provided that this Act, and the regulations under it, shall apply to all fishing and
rights of fishing, and all matters relating thereto, in respect of which the Legislature of British
Columbia has authority to legislate for the purposes of this Act. The terms "water" or
" waters," or " Provincial water" or " Provincial waters," are defined to mean and include
" such of the waters of the sea, or of any bay or inlet of the sea, or of any lake, river, stream
or water-course wholly or partially within the Province, over or in respect of which the
Legislature of this Province has authority to legislate for the purposes of this Act, and whether
flowing over or covering Crown lands or not, but shall not include any waters in which fish
are propagated and preserved by the owner or tenant of the land covered by such waters."
The undersigned has referred to section 53 because it authorises the Board of Commissioners to grant special licences and leases to plant oyster beds in the harbours of the Province.
These, so far as they are public harbours, belong to the Dominion and are not subject to
Provincial legislative authority.    The section is, therefore, to that extent ultra vires.
The remaining sections above mentioned, and perhaps some of the other provisions of the
Act, are objectionable as being fishery regulations. This Act is not unlike the Act respecting
the fisheries of Ontario, 63 Victoria, Chapter 50, as amended by the Ontario Act of 1901, a
number of the provisions in question having apparently been copied from these Acts. In his
Report upon the Ontario Acts, approved by Your Excellency on 11th May last, the undersigned stated that "it has been finally determined that the enactment of fishery regulations
and restrictions is within the exclusive competence of Parliament and not within the province
of Provincial Legislatures. The kind of legislation which the Provinces may pass, with
respect to fisheries under their authority, over property and civil rights, or the management
and sale of public lands, has also been indicated by the Judicial Committee. It refers to
property, its disposition and the rights to be enjoyed with respect to property, and it is
expressly held that such legislative authority does not extend to any restrictions or limitations
by which public rights of fishing are sought to be limited or controlled. The undersigned
stated that he would have considered it necessary to recommend disallowance of both these
Acts were it not for the fact that the Local Government had expressed its willingness to make
further amendments at the next session of the Legislature to repeal the objectionable
provisions, and Your Excellency's Government received a formal assurance from the Government of Ontario that such amendments would be made. The undersigned considers that the
particular provisions of the Statute now in question, to which he has referred, are principally
regulations controlling or relating to the manner or times of fishing, the appliances with which
fish may be taken, or the manner of disposing of them, having in view the prohibition of the
unlawful taking or killing of fish. Large powers are also conferred upon the Fishery Commissioners, with the approval of the Lieutenant-Governor in Council, to make regulations
respecting the fisheries. These provisions cannot, in the opinion of the undersigned, be upheld
upon any principle arising out of the proprietary interest of the Province or the local control
over property and civil rights. The authority of the Legislatures is very clearly established
by the decision of the Judicial Committee in the fisheries case, and the undersigned considers
that they should not transgress the limits which have been judicially declared. He considers
that the sections which he has mentioned should be either repealed or amended, so that they 2 Ed. 7 Correspondence Respecting Acts of 1901. 771
may not affect or authorise the regulation of the fisheries, and he recommends that a copy of
this Report, if approved, be transmitted to the Lieutenant-Governor, with a request that he
inform Your Excellency's Government, as soon as convenient, whether the Act will be so
amended within the time limited for disallowance.
Respectfully submitted,
(Signed)        David Mills,
Minister of Justice.
Extract from a Report of the Committee of the Honourable the Privy Council, approved by His
Excellency on the 25th January, 1902.
The Committee of the Privy Council have had under consideration the annexed Report
of the Minister of Justice respecting 1 Edward VII., chapter 10, passed by the Legislature of
the Province of British Columbia, intituled "An Act to amend the 'Companies Act, 1897.'"
The Committee, concurring in the said Report, advise that a copy of this Minute and of
the said Report attached be forwarded to the Lieutenant-Governor of British Columbia, with
a request that he inform the Government of Canada, as soon as convenient, whether this Act
will be so amended within the time limited for disallowance.
The Committee submit the same for His Excellency's approval.
(Signed)       John J. McGee,
Clerk of the Privy Council.
His Honour the Lieutenant-Governor,
Province of British Columbia.
Department of Justice, Canada,
Ottawa, 27th December, 1901.
British Columbia Legislation, 1901.
To His Excellency the Governor-General in Council:
The undersigned has had under consideration the "Companies Act, 1897, Amendment
Act, 1901," of British Columbia, 1 Edward VII., chapter 10, intituled "An Act to amend the
'Companies Act, 1897.'"
Section 2 is as follows :—" The term ' Extra-Provincial Company,' under the ' Companies
Act, 1897,' shall be deemed to have included and shall include every corporation, company,
association or society incorporated under any Investment and Loan Societies Act, Loan Corporation Act, or Building Societies Act, or any similar Act thereto of the United Kingdom,
or of the Dominion of Canada, or of the late Province of Canada, or of any Province of
Canada (excepting the Province of British Columbia), and having gain for its purpose and
object, and being empowered to lend money to others than its members only, and any such
corporation, company, association or society having obtained a licence under said ' Companies
Act, 1897,' shall not be deemed to come within the 'Extra-Provincial Investment and Loan
Societies Act, 1900.'"
Section 3 provides that the fee to be paid by any such corporation, company, association
or society for such licence shall be $250.
Section 4 enacts that, on or before 1st March in each year, every corporation, company,
association or society mentioned in section 2, licensed under the "Companies Act, 1897," shall
file in the office of the Provincial Secretary a copy of every return or statement required to be
made during the preceding year by the Act, Statute or Ordinance, or other provision of law
under which it was incorporated or is governed, and in default shall be liable to a penalty not
exceeding $25 for every day during which such default continues. So far as this latter
provision is concerned, it is, in the opinion of the undersigned, not justified in the execution
of any power of taxation vested in the Legislature.    If a Dominion company be by its charter 772 Correspondence Respecting Acts of 1901. 1902
or Act of Incorporation required to file returns at the office of the Provincial Secretary, it
must be subject, it case of default, to the Dominion legislation applying in such cases, but a
Provincial Legislature is not authorised to provide any additional sanction, nor is it authorised
as a measure of taxation to impose a penalty for not filing returns upon which the tax does
not in anywise depend.
While not disputing the power of a Legislature to tax a company incorporated by the
Parliament of Canada, the undersigned considers that Dominion companies ought not to be
subject to differential treatment, and that it is the duty of Your Excellency's Government to
see that taxes are not imposed for Provincial purposes upon Dominion companies, where the
like taxes are not in similar cases imposed upon Provincial companies. This Act, ought,
therefore, to be amended by repealing section 4 and by either repealing sections 2 and 3, or
amending them so as to provide that no licence fee or tax shall be imposed or exigible under
the Statute as against a Dominion corporation, except in so far as under the like circumstances
a similar tax or licence fee is similarly chargeable by the law of British Columbia as against
companies incorporated by or under the authority of a Statute of that Province.
The undersigned has the honour to recommend that a copy of this Report, if approved,
be transmitted to the Lieutenant-Governor of British Columbia, with a request that he inform
Your Excellency's Government, as soon as convenient, whether this Act will be so amended
within the time limited for disallowance.
Respectfully submitted,
(Signed)        David Mills,
Minister of Justice.
victoria, b. c.:
Printed by Richard Wolfenden, Printer to the King's Most Excellent Majesty.
1902.

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