Hon. A. B. AYLESWORTH (Minister of Justice).
Mr. Chairman, I do not know that I am authorized to speak for anybody but myself in reference to this measure; nor do I understand exactly what it is that the hon. member for South Simcoe (Mr. Lennox) or any other hon. member of this House would desire from me in regard to this Bill. As far as the question of the power of this parliament to pass a measure of this sort is concerned, I do not suppose any one will have any question. I do not have any idea that in that respect, or upon what may be called the constitutional aspect of this question, I can say anything which will be an enlightenment, or will add in any way to the knowledge, of any hon. member of this House, whether or no that member happens to be of the legal profession or happens to be an ordinary business man. I think our constitution, the British North America Act, is very plain in its intention and in its expression of that intention in regard to the incorporation of companies. What are the provisions of that Act, that we are concerned about? I take it that they are, the distribution of legislative powers in regard to the incorporation of companies, the assigning to the provinces of the power to incorporate companies of a certain class and the assigning to the Domniion of a like power to incorporate companies of another class. I think it is reasonably clear, upon the language of the British North America Act, what the line of demarcation between the two jurisdictions was and is. The incorporation of a company by Act of Parliament, or by the issue of letters patent under the authority of some general Act, is simply the creation, by the proper authority in that behalf, of a new artiflcal, legal being with power to transact business of the character specified in the articles of incorporation. If here was but one legislative authority in Canada no question could
arise. That legislative authority would have the power to create such an artificial, legal being for any and all 'legitimate purposes. But there being throughout Canada a dual legislative authority the British North America Act sought to define the limits of the authority with respect to the incorporation of companies which each of these legislative bodies had. Certain subjects are declared to be within the exclusive legislative power of the Dominion parliament. Certain other subjects are similarly declared to be within the exclusive legislative power of the provinces. No one would imagine-I have not heard any one suggest-that either of these legislative jurisdictions could encroach upon the authority of the other as to the class of subjects in regard to which or for the purposes of which companies may be incorporated. For instance, no one would suggest that the provincial legislature had any power to incorporate a company for the purpose of transacting business with regard to navigation or shipping, or with regard to banking or any of the other subjects which by the 91st section of the British North America Act are assigned to the legislative jurisdiction of parliament. In a similar way exactly no one would suggest that this parliament had power to incorporate a company whose business was limited to the purposes mentioned in the 92nd section as assigned exclusively to the control of the provinces. But the business which a company desires, when it comes into being, to carry on may be of a general character and may not deal exclusively with regard to banking, navigation, shipping, or any other subject which is assigned exclusively to the jurisdiction of the one parliament or the other, and accordingly there is another line of demarcation pointed out under the statute in the most distinct manner as the one that is to govern, and a boundary line laid down over which neither jurisdiction ought to step in the way of encroaching upon the authority of the other. That boundary line is very clearly and distinctly expressed. In the 91st section it is declared that the parliament of Canada has exclusive jurisdiction to legislate in regard to subjects which are, by the British North America Act itself, taken out of the jurisdiction of the provinces. We look at section 92 to find, with regard to companies, what those subjects are which are excluded from the jurisdiction of the provinces and we find in article 10, paragraph a, of the 92nd section, a provision that the provinces may legislate with regard to local works and undertakings other than such as are of the following classes. Then are mentioned works and undertakings extending beyond the limits of the province. So that, the constitution has very plainly stated that with regard to any work or undertaking which is to extend beyond the limits
of the province, not the province, but the Dominion, has the exclusive power to legislate. With regard to the incorporation of companies that is a line of demarcation between the two jurisdictions which is certainly very clearly expressed in the statute and I think ought not to be -difficult to follow. I am sorry to sav that in practice it seems to have been difficult to adhere to that line of demarcation. In the three years during which I have had charge of the Department of Justice it has been an annual occurrence, and I think the same is true of the past, that legislation of different provincial legislatures has required to be noticed in which by special Act some company has been incorporated with the apparent intention that its business operations should not be limited to the province which had incorporated it. It has been and is not an uncommon thing to see in a special Act of a provincial legislature a provision with regard to a company that its head office is to be within the province, but that it is to "have authority to establish offices and agencies at its pleasure outside the limits of the province. It has been a not infrequent thing that a railway company, for instance, would be incorporated by a provincial legislature with power to build its line of railway from some point in the province to a point mentioned upon the boundary line of the province, nothing being said as to what was to happen to the line of railway when it reached the boundary line, the inference plainly to be drawn being that it was to carry that line farther either into an adjoining province or across the international boundary and that the same company, or the same individuals under a separate incorporation elsewhere, were to carry on their works and undertakings beyond the limits of the province. Indeed so far has this practice gone in provincial legislation or in the operation of provincial general Acts that I am aware of at least one case where a company has been incorporated in one of our provinces with the exclusive and sole object of doing business in another province altogether, and I think that in the forty years of confederation the idea has grown up in the minds of business men, possibly in the minds of lawyers as well, and in the minds of our provincial legislatures, that the authority of the provinces, in the matter of incorporating companies, is practically, if not absolutely, co-equal with the authority of the Dominion parliament, and that a company once incorporated bv a provincial legislature has the power, if it pleases, to do business at its will the wide world over. Lawyers frequently refer to the principle spoken of as the comity of nations, and it is argued that by the comity of nations, by the good fellowship or the neighbourliness of other jurisdictions, a company once incorporated by any competent jurisdiction Mr. AYLESWORTH.
anywhere in the world may transact its business at pleasure anywhere else on the face of the globe. While I think it of the utmost importance that this parliament should not overstep the limits which in the matter of incorporating companies, as in other matters, have been assigned to it by the British North America Act, it is of at least equal importance to the body politic that the provincial legislatures should not on their part overstep those limits either. But no question of course arises, so far as this measure is concerned, of the character I have been adverting to, where provinces for any reason have seen fit to incorporate companies and have conferred upon the companies so incorporated powers apparently to transact business beyond the limits of the province. That is a large question, about which lawyers might differ and it does not arise for consideration here.
The practical question for consideration upon tnis measure is whether or not thi3 parliament ought to exercise the power, which in my humble submission it undoubtedly possesses, to constitute these gentlemen named in the Bill, and others who may associate themselves with them, a new legal being, entitled to do the business which this Bill sets out. This measure, in essence, proposes that a company shall be incorporated which shall have the power, as set out in section 8 of the Bill, to carry on, among other things, the business of manufacturing electricity or electric power, heat and light, and transmitting the same for use in any manner at any place in Canada and the United States. I think it goes without saying that no provincial legislature would have power to incorporate a company with the right to do the business defined in the Bill. I do not think any one would contend that a provincial legislature had that power. If any one does so contend, I can only say that it is entirely contrary to my opinion of what the British North America Act, in plain words, states.
I think that under the British North America Act no provincial legislature has any power to incorporate a company whose works and undertakings are intended to extend beyond the limits of the province. No provincial legislature has the power to incorporate a railway company whose line, is to be laid down in more than one province, nor any railway company or telegraph company or any other company' of like character whose works and undertakings are intended to extend beyond and across the provincial boundary line. The works of this company, as stated on the face of the Bill, are proposed to be carried across the international boundary and into the United States. If that is so, it is from this parliament, and this parliament alone, that such a company can seek and obtain valid incorporation in Canada, and the question reduces itself, I submit, to a simple ques-
tion of the propriety of this parliament taking the action which the supporters of this Bill desire. That is a question of policy in regard to which I do not suppose that my opinion is desired by anybody. 1 think that we ought, in considering a measure of this kind, unless there is some evidence to the contrary, to attribute honesty of intention to those who propose the legislation. If any number of men come to this parliament and declare that they wish to be incorporated for a certain legitimate business purpose, it is perfectly competent for any one who suspects the honesty of the statement which they make as to their business intentions to question that statement and to investigate and to demonstrate if it is possible that the statement is not made in good faith. But unless there is some evidence to the contrary, I think one ordinarily, in common business affairs, takes the statement of intention which any one makes to him in a matter of business as being correct. But, having regard to the stage which this Bill has reached, it would seem to me that this committee ought to consider that any question of the honesty of the intention of the promoters of this Bill had been disposed of by the committee which has considered this measure and reported it to the House. That was the place, when this measure was before the special committee to which it was referred, when inquiry into the bona fides of the applicants for incorporation could have readily been made. I do not know whether that inquiry was made or not, but I have no doubt that this Bill was not reported by the special committee which had it in charge without such questions being there discussed. The necessary inference from the action of the committee in reporting the Bill is that the committee was satisfied that this measure was being put forward in good faith, and that it was the honest intention of the promoters of the Bill to use their power to transmit their product across the international boundary for sale in the United States. Not many years ago there was a precisely similar enterprise at Niagara Falls, a company desiring incorporation for the purpose' of manufacturing electric power upon Canadian soil, but with the intention to export that power to the United States to sell it to United States consumers. That company obtained its incorporation at the hands of this parliament; that company is doing business to-day under that incorporation; and the validity of that incorporation has been authoritatively passed upon by our Supreme Court in the course of litigation, declaring that this parliament had undoubted power to give the incorporation which that company obtained. That decision of the Supreme Court would undoubtedly settle any question, if there were such a question, of the power of this parliament to pass the Bill
now under consideration; and giving credit as I do to the promoters of this Bill for honesty of intention, in stating that the powers which they wish and which they consider to be of vital consequence to their enterprise, should go the length of authorizing them to transmit their electric energy across the line into the United States, and that they should have power to construct and operate lines of telegraph and telephone along with their lines for the transmission of electric energy beyond the limits of the province, it seems to me that all questions fall to the ground as ito whether or not this parliament has the power to pass the Bill which it is desired to enact, and as to whether or not this parliament is the proper place to which the promoters of this measure ought to come. With regard to the special provisions of the Bill, no doubt other considerations arise. I do not suppose at this stage of the discussion it is necessary or would be appropriate for me to go into the details of the measure. As to those details, opinions may differ. This House in its wisdom may not see fit, even though the Bill itself is passed, to grant the company all the powers which it asks here. That is a question simply of policy, upon which every member of the committee will make up his own mind and vote according to his views. I might mention one feature of the Bill which stares one in the face the moment he looks at it-the second section, which declares that the works authorized by this Act shall be for the general advantage of Canada. That is a declaration which no other body than this parliament has power to pronounce. It is a declaration which probably we all think has in the past been too freely made, a declaration which it would be well in the general interests of Canada should not be made unless clear reason was shown for it in any individual case. I must say, so far as my individual opinion goes, that I cannot see any reason on the face of this measure, or in considering its provisions and details, for making that declaration in this case. It would not seem to me to be the truth. I cannot see how this undertaking, which appears to be entirely local in its character, so far as its area of operation is concerned, can be truthfully said to be for the general advantage of Canada. It is no doubt for the advantage of all Canada in the same sense that any new undertaking or enterprise, no matter where in the Dominion it may be situate, is for the general advantage. But I cannot see anything special about the undertakings described in this measure which would make those undertakings any more for the general advantage of Canada than the establishment of any manufactory in any town or city between the Atlantic and the Pacific. It, is primarily at any rate
for the advantage of the immediate locality in which it exists, and it can only be, I think, in the most remote degree that these works can be said to be for the general advantage of the whole of Canada. I am not able to see, I must say, any advantage there is to anybody in making the declaration in question. Of course, we all know its effect. Once this parliament sees fit to declare that any undertaking, no matter what its character, is one for the general advantage of Canada, thenceforward this parliament, and this parliament alone, has power to legislate in regard1 to that undertaking. That undoubtedly is the jurisdiction which was conferred upon this parliament of Canada by the imperial parliament in the British North America Act. But the question whether or not in any given case we ought to make that declaration is for us to consider, and in my humble opinion is a question which we ought always to consider with the utmost care. This Bill proposes an undertaking which in my opinion this parliament alone has the power to sanction, because the proposition is to extend its operations beyond the limits of the country. If this parliament agrees in that view and passes this Bill without the declaration that the works are for the general advantage of Canada, the undertaking will remain one in regard to which this parliament and this parliament alone can legislate hereafter.