May 5, 1904

CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

Yes, but the hon. gentleman (Mr. Fitzpatrick) uses it as if it meant rights during the fifty years and after the fifty years.

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LIB
CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

That expression, I think, refers only to ' ownership ' now or at any time during the fifty years. That is the meaning of the words. They apply to any railway or property owned by the government now or at any time in the future during the fifty years. There is no other reasonable construction of those words. They do not extend the term of the privileges to be acquired one day beyond the fifty years. The words are consistent with the rights lapsing at the end of the fifty years and they are inconsistent with any other construction.

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Would not my hon. friend (Mr. Barker) be disposed to criticise rather the use of the word ' lease ' at the beginning of .section 24. Is the document in the contemplation of the parties there, not a lease agreement rather than a lease ? The lease, as I understand it, properly so called, would be applicable exclusively in all its provisions to property which is the object of this lease. Here it is applicable to properties absolutely beyond the lease at all, and I should imagine that this would be more properly described as a lease agreement, which would contain the usual provisions of a lease and also covenants with respect to other properties.

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CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

It is like the case of two parties with adjoining warehouses. One

migth lease his warehouse to the other for '50 years and put in stipulations affecting the mutual use of each other's property during the 50 years, but if in such an agreement the words ' present ' and ' future ' property were to be construed as affecting for all time the property rights, I think it would be regarded as a very extraordinary interpretation. Here the parties are making a lease for 50 years, but further they are providing for mutual user of their two properties.

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Oh, no.

Mr. BARKER, And that the lease of one party's property to the other shall contain proper and usual conditions for such a lease and providing for mutual accommodation, and the minister says that although the lease shall end, one party shall get his rights, his accommodation, in perpetuity and the other not

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Are there not three properties, the western division which is the property of the company and will continue to be operated by the company, the Intercolonial section which is the property of the government and will continue to be the property of the government and be operated by the government and an intervening section, the eastern section, the property of the government and operated by the company.

Mr. BARKER, Yes.

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

There are three in reality, there is the lease properly so called and in addition to that there are covenants applicable to property entirely beyond the lease.

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CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

Yes, but has the hon. gentleman never seen a lease of a warehouse or premises with rights of way and easements over adjoining properties.

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Yes, such arrangements are very common in our part of the country.

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CON

Samuel Barker

Conservative (1867-1942)

Mr. BARKER.

All proper conditions would be put in such a lease ; but all would end with the lease. I cannot imagine that if the hon. gentleman thought that certain rights or easements were to be in perpetuity, while the lease was for 50 years, he would not have used language that would put it beyond a doubt. It is one of the things I am sorry to say we have had to repeat so often, that where it was possible to use language that would put the matter beyond doubt we are left open to legal construction and the opinions of gentlemen at the bar. I think it is most unfortunate the country should be left in such a position

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

Perhaps my hon. friend (Mr. Barker) would say here in all serioirsness, in "view of his reputation as a lawyer in this country that he has ever seen a legal document, that a lawyer could not twist and distort.

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CON
CON
CON
CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. R. L. BORDEN.

After all there Is not so much difference between the leasing of the eastern division and the granting of these running powers and haulage rights over the western division. My hon. friend the Minister of Justice seems to make a great distinction between the two. You have the leasing to the Grand Trunk Pacific of the eastern division with a reservation to the government of running powers and haulage rights over it. You have the operation of the western division by the Grand Trunk Pacific with the granting of running powers and haulage rights to the government. The two will stand much in the same position. In the one case the Grand Trunk Pacific will own the line, that is the western division, subject to certain running powers and haulage rights in favour of the government. In the other case the Grand Trunk Pacific as lessee will be the owner for 50 years of the eastern division subject to running rights and haulage powers in favour of the government. There is not so very much distinction after all, and all of these rights would be properly contained in the same lease. The term of that lease has been expressly defined in section 20 as 50 years. The rights of the government and the company are fixed in respect of the eastern division beyond doubt for 50 years. Then with the words ' proper and usual ' at the commencement of section 24 there cannot be any doubt that the similar powers-secured to the government 'and the company in respect of the western division are also to endure for fifty years. That is to say that the government for fifty years is to have only haulage rights over the eastern division. The government for 50 years, is to have equal haulage rights over the western division and the object of both provisions is that for 50 years the government, in respect of the Intercolonial which it owns, shall have running powers and haulage rights not only over the eastern division, but also over the western division for the same period in order that during that period of 50 years the government may if it sees fit send its trains from Halifax to the Pacific coast. Now all this is limited by the term in the lease, 50 years, and these provisions never would have been put in the lease as my hon. friend from Hamilton (Mr. Barker) has well remarked, but they would have been embodied in an independent agreement If the view which my hon. friend the Minister of Justice (Mr. Fitzpatrick) put forward to-night were the view which was in the mind of the draughtsman. I am not concerned very much, of course, with the Mr. FITZPATRICK.

mind of the draughtsman. What we are concerned with is the language, but it is an important fact that all these stipulations are contained in a lease which is to be in operation for 50 years. I would put: this to the Minister of Justice : Suppose he comes to make an agreement, suppose he comes to settle the provisions of the lease to the Grand Trunk Pacific. Under the terms of section 24c you are :

Securing to the government, in respect of its ownership as aforesaid, running powers and haulage rights over the western division, or any portion thereof, upon such terms as may he agreed upon between the government and the company.

The Minister of Justice says that these terms are to be secured in perpetuity. The Grand Trunk says : No, these powers are to be secured only for a term of 50 years. What follows ? Under the provision of subsection 2 you are to go to the Board of Railway Commissioners, with the right to either party to appeal to the Supreme Court of Canada. What is the Board of Railway Commissioners to say? They would see that those stipulations are to be contained in a lease for 50 years and it seems to me they would say that in the absence of an express provision to the contrary these powers cannot be created for a term beyond the term of the lease, beyond the period of 50 years, because the first question that would strike any lawyer when he undertook to construe seetioh 24 with section 20 would be this :

Is there from the commencement to the conclusion of section 24 one single word or expression which defines the term for which these running powers and haulage rights over the western division shall be created, except the period of fifty years mentioned in section 20 ? You will not find one single word, one single provision, as to the term, except the provision as contained in section 20.

Where then are you to look for it ? My hon. friend the Minister of Justice says that because no term is mentioned, except the term of fifty years, you must there fore conclude that these rights are to continue indefinitely. Perhaps I am not doing justice to his argument. I am trying to do justice to his argument. My hon. friend puts it forward in some such way as that. You must find the term somewhere during which these powers are to continue. The only term to which you can look is the term mentioned in section 20. If you go beyond that, how is it that you arrive at the conclusion that they are to continue for ever ? Where is there a single line or stipulation from one ond of this contract to the other that shows that these powers are to continue for ever ? If you are not bound by the term of fifty years mentioned in section 20 of the contract, I would say that the only term for which they could be created would be a reasonable term, having regard to the provisions of this contract, and if you were reduced to

trying it by a measure of that kind, you would inevitably come back to the period of fifty years, because, as this lease is granted for fifty years, that would be a reasonable time having regard to all the other provisions of this contract.

There is no expression in this contract which says that these powers shall continue for ev'er. There is a provision which says that the lease shall continue for fifty years. How can my hon. friend, in face of that, argue with any semblance of reason that these powers, indefinite as to time or by this contract limited by a term of fifty years, are to continue for ever ? I certainly think that my hon. friend has not taken the correct view of this case, and I think it is very unfortunate for the country that the point has been overlooked, because, as I pointed out before recess, the result of it is that for fifty years after this lease terminates the Grand Trunk Pacific Railway Company' will have running powers and haulage rights over the eastern division, while the government will not have any corresponding rights over the western division. This may be of very great importance to the government. It may be possible that during this period of fifty years the government, by means of these running powers and haulage rights over the eastern and western divisions, may be able to build up a very important business, and continuity of operation will be of the highest possible importance to the government. The Grand Trunk Pacific realize that that will be of very great importance to them, because they have obtained from the government this amendment :

The company shall he entitled for a further period of fifty years to such running powers and haulage rights as may he necessary to continuity of operation between the said western division and other portions of the company's system and the Grand Trunk Railway system.

That may become equally important to the government. They will have that continuity of operation under the agreement for fifty years, but the company have the right for one hundred years. I have not the slightest doubt that for the government that continuity of operation will come to an end at the expiration of the fifty year term ; whereas, the Grand Trunk Pacific are amply safeguarded by another period of fifty years at least usder the provisions of the clause which we are now discussing. It may be a matter of very great importance, and I regret that it has not received more consideration at the hands of the government, because, knowing the ability and care which are exercised in these matters by my hon. friend the Minister of Justice, I feel sure that if this matter had struck him when the agreement was being drafted in the same way as he apprehends it to-night, we would have had a very different provision indeed in the supplementary

agreement from that which is now before the House for its approval.

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

When I spoke before I wanted to limit my statement to the use of words applicable to the ownership of the Intercolonial Railway, because it is only so long as the government remains the owner of the Intercolonial Railway that we can exercise our rights over the western division.

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CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. R. L. BORDEN.

Yes, but would not those rights pass to a subsequent owner of the Intercolonial Railway ?

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LIB

Charles Fitzpatrick (Minister of Justice and Attorney General of Canada)

Liberal

Mr. FITZPATRICK.

I would be disposed to think that that would affect the western extension, whatever changes might take place in respect to the ownership, because it would be what we call a real right. As to the other, I am not so sure about that.

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CON

Robert Laird Borden (Leader of the Official Opposition)

Conservative (1867-1942)

Mr. R. L. BORDEN.

My learned friend does not, it seems to me, quite get out of the difficulty in that way, because, coming to subsection ([d) of section 24 of the original agreement:

Securing to any railway company, desiring to make use of the same, running powers and ha'ulage rights over the said western division-

my hon. friend is driven to the same

conclusion that these rights, when they are created, are to be created in perpetuity, that they are to be created so that they will exist for ever. My hon. friend argues that without being able to put his finger on one single line of this contract which either expressly, or by necessary implication, says that these rights shall exist for ever. No period is fixed. I would say that, inasmuch as the term of the lease is fixed, you must be limited to that term and you must not say that the rights under the lease will continue for any indefinite period.

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May 5, 1904