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foreign country. For reasons which will be found discussed in chapter IX., ante, p. 185, et seq., it is submitted that a provincial legislature has no such power, nor indeed has the Dominion parliament, so far as the operation of the road without Canada is concerned. So far as the incorporation of any such company is concerned, sub-section 11 would appear to prevent a provincial legislature from passing any laws in reference thereto. The question of the status and rights of a corporation without the limits of the country under whose laws it is incorporated is not within the scope of this work, being a matter of international, rather than of colonial, law.
A number of very interesting cases have arisen involving consideration of the position occupied by federal “works and undertakings” and federal companies in reference to provincial law upon matters within the legislative competence of a provincial legislature—and vice versa. In reference to the incorporation of companies with objects other than provincial and other than those covered by the exceptions to sub-section 10, no difficulty perhaps should arise. For the very same reasons which led us to limit the scope of the term “municipal institutions,” we submit that a company incorporated under Dominion legislation can exercise no power which its creator could not directly exercise ; its Act of incorporation can confer corporate capacity merely and powers in relation to matters within the legislative competence of that creator. We have already touched upon this question (m) and shall refer in a moment to certain cases which, we think, bear out the view we have ventured to express. As to works and undertakings falling within the exceptions to sub-section 10—whether carried on by a company or by individuals—a somewhat different question arises, namely-what is covered by the term "works and undertakings ” ?—but this question must, it seems to us, be ultimately decided upon the very same prin
(m) See ante, p. 353.
ciple. The difficulty arises from the fact that a work or undertaking may to-day be provincial and to-morrow federal, and, it may be asked, how can the subject matter of such work or undertaking be—as a matter of law—within the legislative competence of a provincial legislature, one day, and within that of the parliament of Canada the next. Without attempting any elaborate discussion we may venture the opinion that the solution of these questions will require a freer application of the rule laid down in Bank of Toronto v. Lambe--that legislation by one legislature may limit the range open to the other (n)-than has yet been attempted. We now proceed to examine the cases.
A railway incorporated under a provincial Act was declared to be a federal railway under clause (c) of subsection 10, by an Act of the parliament of Canada. An Act of the legislative assembly of Quebec amalgamating the company at its own request with another provincial railway, was held ultra vires by the Judicial Committee of the Privy Council (o).
Mr. Justice Killam in Manitoba held in Canadian Pacific Ry. v. North Pacific & Man. Ry. (p), that it is within the competence of the Dominion parliament to enact that no provincial railway shall cross a Dominion railway without the approval of the Railway Committee of the Privy Council. He treats the power to legislate in reference to “crossings” as incidental to the power of the Dominion parliament in relation to general undertakings as well as to the power of the local legislatures in relation to local undertakings within this sub-section. It would seem therefore to depend upon the question—which occupied the ground first ? Unless this is to be the rule for determining these disputes, it must be conceded that, in this
(n; See ante, p. 213, and notes to sub-section 16, post.
instance at least, provincial legislation must be subordinate to Dominion legislation.
Where it is necessary for a provincial railway in Ontario to cross a Dominion railway, the company desiring to effect such crossing, must procure the approval of the Minister of Public Works for Ontario, as well as the approval of the Railway Committee of the Privy Council for the Dominion, and the railway companies concerned cannot waive this provision (q).
The power of a provincial legislature to pass laws as to insurance contracts entered into within the province by a Dominion or a foreign corporation, was considered in Parson: v. Citizens (r), and the view of the Judicial Committee of the Privy Council is thus expressed :
• It was contended, in the case of the Citizens Insurance Company of Canada, that the company having been originally incorporated by the parliament of the late province of Canada, and having had its incorporation and corporate rights confirmed by the Dominion parliament, could not be affected by an Act of the Ontario legislature. But the latter Act does not assume to interfere with the constitution or status of corporations. It deals with all insurers alike, including corporations and companies, whatever may be their origin, whether incorporated by British authority, as in the case of the Queen Insurance Company, or by foreign or colonial authority, and without touching their status, requires that if they choose to make contracts of insurance in Ontario, relating to property in that province, such contract shall be subject to certain conditions." and this, it was held, a provincial legislature had full power to do, under section 92, sub-section 13.
In Colonial Building and Investment Association v. Attorney-General of Quebec (8), the Judicial Committee of the Privy Council, referred to the hypothetical case, put by way of illustration in Citizens v. Parsons, as to the applica
(9) Credit Valley R. R: Co. v. Great Western Ry. Co., 26 Grant, 507. (r) 7 App. Cas, 96. (8) 9 App. Cas. 157.
bility, to a Dominion company, of a provincial mortmain law, and expressed their continued adherence to the view then entertained as to the respective powers of the Dominion and provincial legislatures in regard to incorporated companies. The two cases lay down very clearly that a Dominion company can only exercise its powers subject to the law of the particular province in which any of its transactions may be carried on. In the first named case the matter was merely put by way of illustration in reference, as we have said, to the operation of provincial mortmain laws:
“Suppose the Dominion parliament were to incorporate a company with power, among other things, to purchase and hold lands throughout Canada in mortmain, it could scarcely be contended if such a company were to carry on business in a province where a law against holding land in mortmain prevailed (each province having exclusive legislative power over 'property and civil rights in the province') that it could hold land in that province in contravention of the provincial legislation ; and, if a company were incorporated for the sole purpose of purchasing and holding land in the Dominion, it might happen that it could do no business in any part of it, by reason of all the provinces having passed mortmain Acts, though the corporation would still exist and preserve its status as a corporate body."
This the Committee explain in the later case by saying that they had not in view the special law of any one province, nor the question whether the prohibition was absolute, or only in the absence of the Crown's consent; that their object had merely been to point out that a corporation could only exercise its powers, subject to the law of the province, whatever that may be, in this regard.
In this connection may be mentioned the case of McDiarmid v. Hughes (t), in which the Divisional Court of the Queen's Bench Division (Armour, C.J., and Street, J.), held that the Dominion parliament has power to enact that a license from the Crown shall not be necessary
(1) 16 O. R. 570.
to enable corporations to hold lands within the Dominion; and that a Dominion Act enabling a Quebec corporation to hold lands in Ontario, would operate as a license;—a view difficult to reconcile with the above cases. No doubt, as put by the Chief Justice, an Imperial Act might be passed, extending to all Her Majesty's possessions, providing that thereafter a license from the Crown should not be necessary to enable any corporation to hold lands therein, but it seems to us a non sequitur to say that an Act of the Dominion parliament would have effect throughout the Dominion in relation to matters over which, as between the Dominion parliament and the provincial legislatures, the latter have exclusive jurisdiction. The power of a corporation to hold land is part of the law relating to real property, and governed therefore by the lex loci, and the grant of a license from the Crown to hold lands, non obstante the Mortmain Acts, must be made by the executive head of that government whose legislature has power to pass laws in relation to real property within its territorial limits.
In Monkhouse v. Grand Trunk R. R. (u). it was held that a provincial statute which made provision as to
frog-packing” applicable only “to every railway and railway company in respect to which the legislature of Ontario has authority to enact such provisions,” did not apply to the Grand Trunk R. R. Company, which falls within exception (a) to this sub-section 10. Just what is the scope of legislation relating to a work or undertaking such as a railway connecting one province with another, is left by this case still uncertain. Mr. Justice Patterson puts his decision on the ground that the statute, there in question, “which relates to the management and in some respects to the construction of railways, and deals only with railways as such ” did not apply to the defendant company; and he expressly reserves the question how far
(u) 8 0. A. R. 637.