Prop. 66 they speak as though the provincial legislatures could raise a revenue only by direct taxation.

But it does not seem to follow that the provincial legislatures may not have a limited power to inpose indirect taxation, either under No. 16 of section 92, in which case it would have to be imposed under such circumstances and conditions as to make its imposition a merely local matter in the province;1 Provincial or as incidental to one of their other express powers. Some of these seem to forcibly suggest taxation, as No. 4, the payment of provincial officers,'-No. 6, the maintenance' of public and reformatory prisons in and for the province,'-No. 7, the maintenance' of hospitals, etc.,-No. 14, the maintenance' of provincial courts; and there is not a word. in them to limit such taxation to direct taxation.

indirect taxation.

Debates before Confederation.

The only decision on the point would seem to be that of the Quebec Court of Queen's Bench in Bank of legislatures are confined to direct taxation: 2 S.C. R. at pp. 108, 123, 138, 1 Cart. 452, 467, 483; and so, per Wurtele, J., in Lamonde 7. Lavergne, R.J.Q. 3 Q.B. 303, (1894), at p. 311; per Lacoste, C.J., S.C. at p. 304; and the report of Sir John Thompson, as Minister of Justice, of January 28th, 1889: Hodgins' Provincial Legislation, 2nd ed., at p. 581. It would certainly seem as though the founders of Confederation supposed that the provincial legislatures would, in the matter of taxation, be confined to direct taxation and the licenses under No. 9 of section 92, which, as has been seen, (supra pp. 723-4), themselves constitute direct taxation. Cf. the speech of the Hon. A. T. Galt in the Debates on Confederation, p. 68. And cf. per Taschereau, J., in Angers v. The Queen Insurance Co., 16 C.L.J.N.S. at pp. 201-3, 1 Cart. at pp. 145-7, (1877); per Dorion, C.J., Bank of Toronto v. Lambe, M. L. R. IQ.B. at pp. 136-8, 4 Cart. at pp. 35-6. So also when the British North America Bill was before the British Parliament, Lord Carnarvon in the House of Lords and Mr. Cardwell in the House of Commons both spoke as though the only provincial power of taxation was to be that of direct taxation: Hans. 3rd ser., Vol. 185, at pp. 564, 1179. But as to these debates being no authority on the interpretation of the Act, see per Ramsay, J., in Bank of Toronto v. Lambe, M.L.R. 1 Q.B. at p. 186, 4 Cart. at p. 77; per Moss, J.A.. in Smiles v. Belford, 1 O.A.R. at p. 450; per Burton, J.A., S.C. at p. 445, who, however, merely says that "at any rate little or no weight can be attached to them."

1See the words of the Privy Council in the Liquor Prohibition Appeal, 1895, [1896] A.C. at p. 371, quoted supra p. 657.

indirect

Toronto v. Lambe,1 where after deciding that the Prop. 66 taxes there in question were direct taxes, the Court, as would appear from the report, went beyond what was necessary to add a clause in the formal judgment that, even assuming they were not direct taxes, the legislature had power to impose the same, inasmuch as the said taxes were 'matters of a merely local or private nature in the province.' And as will Provincial presently be seen there are more judicial dicta in taxation. favour of the provinces having this limited power of indirect taxation than against it; and the Privy Council certainly seem to countenance the claim, at all events under No. 14 of section 92, in AttorneyGeneral of Quebec v. Reed, where after deciding that a Quebec Act imposing a stamp duty of ten cents upon every exhibit filed in Court, the fund so created to be applied as part of the general revenue of the province, was ultra vires as indirect taxation, they add3:"One of the things which are to be within the powers of the provincial legislatures— No. 14 of within their exclusive powers-is the administration B.N.A. Act. of justice in the province, including the constitution, maintenance, and organization of provincial Courts, and including the procedure in civil matters in the Courts. Now it is not necessary for their lordships to determine whether, if a special fund had been created by a provincial Act for the maintenance of the administration of justice in the provincial Courts, raised for that purpose, appropriated to that purpose, and not available as general revenue for general provincial purposes, in that case the limitation to direct taxation would still have been appli

1M.L.R. 1 Q.B. 122, 199, 4 Cart. 24, 90, (1885).

210 App. Cas. 141, 3 Cart. 190, (1884).

10 App. Cas. at pp. 144-5, 3 Cart. at pp. 194-5.

sect. 92,

General of

Quebec v.
Reed.

Prop. 66 cable. That may be an important question which will be considered in any case in which it may arise; but it does not arise in this case. This Act does not relate to the administration of justice in the province; it does not provide in any way, directly or indirectly, for the maintenance of the provincial Courts; it does not purport to be made under that power, or for the performance of that duty. The subject of taxation, indeed, is a matter of procedure Attorney in the provincial Courts, but that is all. The fund to be raised by that taxation is carried to the purposes mentioned in the second sub-section," (sc. of section 92, of the British North America Act); "it is made part of the general consolidated revenue of the province. It, therefore, is precisely within the words taxation in order to the raising of a revenue for provincial purposes.' If it should greatly exceed the cost of the administration of justice, still it is to be raised and applied to general provincial purposes, and it is not more specially applicable for the administration of justice than any other part of the general provincial revenue. Their lordships, therefore, think that it cannot be justified under the 14th subsection."1

Indirect

1It is clear from this passage that Gwynne, J., is mistaken when taxation by he says, (S.C., 8 S. C. R. at p. 433, 3 Cart. at p. 210):—“The judglaw stamps. ment of the Privy Council in The Attorney-General of Quebec v. The Queen Insurance Co., 3 App. Cas. 1090, i Cart. 117, in effect decides that the provincial legislatures cannot by any Act of theirs, authorise the raising a revenue by any mode of taxation other than direct." See supra pp. 713-4, and infra p. 736. But notwithstanding these words of the Privy Council, the Manitoba Court of Queen's Bench decided in Dulmage v. Douglas, 4 M. R. 495, (1887), over-ruling the decision of Dubuc, J., 3 M.K. 562, that a provincial Act, 49 Vict., c. 50, imposing taxation by law stamps in order to provide for the maintenance of the administration of justice in the,Courts, and of the Court houses and goals in Manitoba, and providing that the proceeds of the sale of the law stamps by the provincial treasurer, should pass, not into the general revenue of the province, but should form a special fund, to be respectively called "The Administration of Justice Fund," and "The Building Fund," was nevertheless ultra vires. The Court held that 'maintenance in No. 14 of section 92 does not warrant such indirect taxa

indirect

Now it will be seen that the Privy Council in this Prop. 66 case make no mention of No. 16 of section 92, as possibly authorizing indirect taxation in certain. cases. And yet, as has been seen in a former part of this work,1 a subject matter of legislation may be of a 'merely local or private nature in the province,' Provincial within the meaning of that clause, and yet may ex- taxation. tend in its operation over the whole province. Therefore if in any case indirect taxation were justifiable under this clause it would, it is submitted, be no objection to it that the proceeds of such taxation. were to be applied as part of the general revenue of the province. But on the other hand to come within No. 16, the taxation would have to be of such a character as to be a matter of merely local or private nature, in which the people of the province alone have an interest2; and it might well be argued that a tax upon legal proceedings in a province was a matter in which the whole Dominion was interested, No. 16 of as the residents of all the other provinces might B.N.A. Act. have at times to resort to the Courts of the province imposing the taxation. However it does not appear from the abbreviated argument as reported in Vol. 10 of Appeal Cases, that the question of whether the taxation in question was supportable under No. 16 was at all raised before their lordships. For these reasons it would not seem that the judgment in Attorney-General of Quebec v. Reed can be properly tion, but means "maintenance in such manner and by the exercise of such powers as are within the scope of the authority of the legislature," and so must be by direct taxes or licenses, which it regarded as an exceptional form of indirect taxation allowed to the province. But see supra pp. 723-4. See also, supra pp. 417, n. 2, 482, and the report of the Minister of Justice of November 2nd, 1895: Hodgins' Provincial Legislation, 2nd ed., pp. 244a, 244b.

1Supra pp. 651-5.

2 Supra pp. 655-61.

3

3 There does not appear to be a verbatim report of this argument.

sect. 92,

Prop. 66 considered as deciding anything for or against the right of the provinces to impose indirect taxation in certain cases under No. 16 of section 921; nor can the previous judgment in Attorney-General of Quebec v. Queen Insurance Co., where in like manner no attempt appears to have been made to support the tax under any other clauses of section 92 than Nos. 2 and 9.

Provincial indirect taxation.

However in Attorney-General of Quebec v. Queen Insurance Co., in the Supreme Court of Canada,3 Gwynne, J., holds against any right whatever of indirect taxation being possessed by the provinces, firstly, on the ground that No. 2 of section 92, while it authorizes the provincial legislatures to make laws in order to the raising of

revenue for provincial purposes by taxation, limits the exercise of the authority thus conferred to direct taxation, and thus, in his judg ment, "very clearly excludes the power of raising a revenue by any species of taxation other than direct;" "' and, secondly, because, “this implied power of raising revenue by indirect taxation, which it is contended the legislatures have, being exercised, as it might be if they have the power, to raise sufficient revenue to defray all the expenses of the government and legislatures in respect of all the several matters under their control and jurisdiction,

1 Nor do the words of the Privy Council in reference to this clause, quoted supra p. 652, from their recent judgment on the Liquor Prohi bition Appeal, 1895, [1896] A.C. at p. 365, appear to affect this question. And see Dow v. Black, L. R. 6 P.C. 272, 1 Cart. 95, (1875), as referred to infra pp. 739-40.

23 App. Cas. 1090, I Cart. 117, (1878).

38 S.C.R. at pp. 431-3, 3 Cart. at pp. 208-10, (1883), sub nom. Reed & Mousseau.

4 And so per Jetté, J., in Bank of Toronto v. Lambe, M. L. R. 1 S.C. at p. 42, 4 Cart. at p. 98.