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Prop. 66

No. 2 of sect. 92

A further question however arises with regard to No 2 of section 92 of the British North America Act besides that of the meaning of direct taxation,' namely whether the words 'in order to the raising of a revenue for provincial purposes,' indicate that B.N.A. Act. direct taxation may not be resorted to by a provincial legislature in order to raise a revenue for local or municipal purposes, as distinguished from general provincial purposes. This has been supposed to be the intent of the clause by some judges,1 and colour is lent to such a view by the fact that No. 9 of section 92, expressly authorizes legislation in relation to the licenses there referred to in order to the raising of a revenue for provincial, local, or munici'Provincial pal purposes.' However in Dow v. Black, where the constitutionality of a provincial Act authorizing the inhabitants of a parish to raise by direct taxation, within the parish, a subsidy for a certain railway came into question, and it was contended that

purposes.'

1See e.g. per Weatherby, J., in City of Halifax v. Western Assurance Co., 18 N.S. at p. 392, (1885): per Begbie, C.J., in Regina v. Mee Wah, 3 B.C. at pp. 404-5, (1886). As recently as on the argument in The Brewers and Maltsters Association of Ontario v. AttorneyGeneral for Ontario,[ 1897] A. C. 231, (supra p. 679), Sir R. Couch, no doubt forgetting for the moment the decision in Dow v. Black referred to in the text, is reported as saying: "May it not mean this. By sub-section 2, there is a power of direct taxation for provincial purposes, then by sub-section 9 is not the power of direct taxation by licenses given, not only for provincial purposes, but for municipal purposes. That might reconcile the two:" Manuscript transcript from notes of Marten Meredith and Henderson, at p. 58. And see ibid. at pp. 52-3, where Lord Herschell said in reference to this point, addressing Mr. Edward Blake, who was arguing: "You would say that a local or municipal purpose is a provincial purpose." To which Mr. Blake replied: "Yes, and I may say that the vast mass of the whole of the enormous municipal expenditure of the province of Ontario is borne by direct taxation imposed under the authority of the legislature by the municipalities for municipal purposes. We would go to pieces altogether if that were not so. And Lord Watson shortly afterwards said: "You construe it very reasonably as meaning revenue purposes, arising within the province somewhere"; and Mr. Blake replied: "Yes, I have no doubt about that, and I do not raise any point about it."

2L.R. 6 P.C. 272, 1 Cart. 95, (1875).

1

subsidise

No. 2 of section 92 of the British North America Prop. 66 Act only authorizes direct taxation incident on the whole province for the general purposes of the whole Tax to province, the Privy Council say: "Their lordships a railway see no ground for giving so limited a construction to this clause of the statute. They think it must be taken to enable the provincial legislature, whenever it shall see fit, to impose direct taxation for a local purpose upon a particular locality within the province."2 In the recent Brewers and Maltsters Association case, 3 above referred to, their lordships confined their judgment to the question of the validity of the specific enactment before them, under which the license fee imposed was expressed to be in order to raise a revenue for provincial purposes,' and held it valid as direct taxation under No. 2 of section 92; but did not answer the more academic question submitted to them as to whether the pro- The Brewers vincial legislature could so tax not only in order to sters case. raise a revenue for provincial purposes, but also "for any other object within provincial jurisdiction," further than to give utterance to a dictum in reference to No. 9 of section 92, which will be referred to in connection with what has now to be said in respect to that clause.

No. 9 of section 92, assigns to provincial legislatures the exclusive power of making laws in relation to 'shop, saloon, tavern, auctioneer, and other licenses in order to the raising of a revenue for provincial, local, or municipal purposes,' and up to a recent date it has been very generally supposed that

1L. R. 6 P.C. at p. 282, 1 Cart. at p. 107.

2 Mr. Clement observes, in his Law of the Canadian Constitution, at p. 425, that this decision "is sufficient warrant for the whole system of municipal taxation now operative throughout Canada."

3[1897] A. C. 231. See supra p. 679. As to what is taxation 'within the province' see the notes to Proposition 68.

and Malt

No. 9 sect. 92 B.N.A. Act.

of

Relates to direct taxation.

Prop. 66 such taxation by licenses was indirect taxation, and that the object of this clause was to allow provincial legislatures to tax indirectly in this way, though otherwise confined to direct taxation.1 In more recent judgments, however, as has been already intimated, the view that such taxation was direct and not indirect found much support, and has now been established, as we have seen, by the Privy Council in the recent Brewers and Maltsters Association case, for although they did not find it necessary positively to decide that the license fee imposed upon brewers and distillers which they were dealing with came within No. 9 of section 92, they did decide that it was a direct tax, and this whether it came within that clause or not. So that the suggestion made in a previous part of this work may be again repeated that the probable explanation of No. 9 is that it was inserted to secure this mode of Its probable raising revenue to the provinces, although some doubt might exist as to the direct or indirect character of the taxation. And on the argument in the last mentioned case Lord Herschell is reported as saying: "They may have put in sub-section 9 in. order to make certain that a particular kind of things. would beyond all question be within taxation pow

explanation.

ers."5

1So, eg., per Wilson, J., in Regina v. Taylor, 36 U.C.R. at pp. 195, 201, (1875); per Taschereau, J., in Angers v. Queen Insurance Co., 16 C.L.J.N.S. at pp. 201, 205, 1 Cart. at pp. 141, 147; per Richards, C.J., in Severn v. The Queen, 2 S.C. R. at p. 88, 1 Cart. at pp. 431-2; per Ritchie, C.J., S.C., 2 S.C.R. at p. 98, 1 Cart. at pp. 441-2; per Strong, J., 2 S.C. R. at pp. 105, 108, 1 Cart. at pp. 448, 452; per Fournier, J., 2 S.C. R. at pp. 123-4, I Cart. at pp. 467-8; per Taschereau, J., S. C., 2 S.C.R. at pp. 113-4, I Cart. at p. 457.

2 Supra p. 361, n. 2.

3[1897] A.C. 231.

*Supra p. 377, n. 2.

Manuscript transcript of notes of Marten Meredith & Henderson,

at p. 55.

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licenses

of sect. 92

There is also another point which arises as to the Prop. 66 construction of No. 9 of section 92, and in respect to which it seems probable that the view long prevalent will soon have to be finally abandoned. It concerns the import of the words and other licenses;': Other and in an early page of this work,1 the cases have in No. 9 been referred to in which it has been sought to apply the rule of ejusdem generis to these concluding general words. Cases the other way, however, are also mentioned there, and some words of the Privy Council in Russell v. The Queen" referred to as indicating that the Board were not disposed to confine the words by the application of the maxim alluded to. The difficulty of course is to find the genus which would embrace the four licenses mentioned, and yet not include all other trades and callings, a difficulty felt and expressed strongly by various members of the Board upon the argument in the recent Brewers and Maltsters Association Need they be ejusdem case; and in their judgment therein they went be-generis?" yond what was absolutely necessary to dispose of the appeal to say: "their lordships were not satisfied by the argument of the learned counsel for the appellants that the license which the enactment renders necessary," (sc. a license on brewers and distillers to sell wholesale within the province), "is not a license within the meaning of sub-section 9 of section 92. They do not doubt that general words. may be restrained to things of the same kind as those

66

1Supra p. 27, n. I.

27 App. Cas. at p. 838, 2 Cart. at p. 21, (1882).

[1897] A.C. 231. Thus Lord Herschell is reported as saying: 'They clearly could raise revenue by taxing an auctioneer who carries on his calling. Would you say that there is no other person carrying on a calling whom they could tax, although you find following the words ' auctioneers and other licenses.' Whom could they tax? What is the distinction between whom they could tax and whom they could not tax?" Manuscript transcript of Marten Meredith and Henderson's notes, p. 58. See, also, ibid. pp. 60, 65.

4See supra p. 724.

Prop. 66 particularized, but they are unable to see what is the genus which would include shop, saloon, tavern, and auctioneer' licenses, and which would exclude brewers and distillers licenses;" and thus they destroy the authority of Severn v. The Queen,1 upon the one point on which, if any, its authority remained unimpaired.

Wholesale licenses.

No. 9 of sect. 92, B.N.A. Act.

2

3

In this case then of the Brewers and Maltsters Association, as we have seen, the Privy Council held that the license fees imposed by the Ontario Act before them being direct taxation, the Ontario legislature had power to impose them though those affect. ed were wholesale dealers, selling by wholesale being defined by the Act as selling in quantities of not less than five gallon casks or one dozen bottles, etc., the distinction between wholesale and retail trade being treated, as has always been usual in our

1 2 S.C.R. 70, 1 Cart. 414.

2 See supra p. 27, n. 1. In addition to the cases there cited, City of Halifax v. Western Insurance Co., 6 R. & G. (18 N.S.) 387, (1885), may be referred to, where the provincial legislature was held entitled, under No. 9 of section 92, to require a license for municipal purposes from insurance companies. In the Queen v. McDougall, 22 N.S. 462, (1889), Weatherbe, J., refers to this decision as having been affirmed by the Supreme Court of Canada; but on enquiry from the Registrar it appears the case never came before that Court. In Regina v Mee Wah, B.C. 403, (1886), Begbie, C. J., held against the validity of a license fee on wash-houses and laundries, as not being ejusdem generis with those specified in No. 9 of section 92. In regard to legislation affecting the liquor trade, the line of distinction between enactments looking to the raising of revenue by taxation, and those looking to the regulation of such trade for police and municipal purposes, has perhaps not always been kept in mind in the cases as clearly as it might with advantage have been. In Regina v. Mee Wah, 3 B.C. 403, at pp. 499-15, Begbie, C. J., held the license there in question not within No. of section 92 at all, because not imposed bonâ fide for the sole purpose or even mainly for the purpose of raising a revenue, but for the repression or suppression of Chinese laundries in Victoria. But there would seem no doubt of the provincial power to prohibit Chinese laundries. See supra pp. 399-401. And cf. supra p. 560, n.

3 Supra pp. 718-20.

4 R.S.O. c. 194, s. 2, subs. 4.

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