Judgments

Decision Information

Decision Content

T-358-75
Manitoba Fisheries Limited and Harry Gordon Marder and Sophia Marder (Plaintiff)
v.
The Queen (Defendant)
Trial Division, Collier J.—Winnipeg, November 8, 9 and 10; Vancouver, December 22, 1976.
Action for declaratory judgment that plaintiff entitled to compensation for property taken and to fair market value of business acquired by Crown — Acquisition of goodwill render
ing plant and equipment valueless Whether legislation intended to deprive plaintiff of goodwill and business — Offers of compensation refused — Whether deprivation of property
unlawful under Canadian Bill of Rights Freshwater Fish Marketing Act, R.S.C. 1970, c. F-13, ss. 21, 23 and 25 — Canadian Bill of Rights, S.C. 1960, c. 44, paras. 1(a) and 2(e).
Plaintiff company seeks a declaration that it is entitled to compensation for the loss of its business and goodwill, which were acquired by the defendant under the Freshwater Fish Marketing Act. It alleges that as a result of losing its goodwill and business, the assets of the business were rendered valueless. Even if the legislation provides for licensing, or regulations permit individuals to carry on their business, no such licences have been issued or regulations made, with the result that its business has effectively been taken away and this in a manner that contravenes the Canadian Bill of Rights.
Held, the action is dismissed. Although the plaintiff company lost its business and goodwill, this was not the intention of the legislation. Paragraph 25(2)(c) of the Act envisages the com pensation of persons whose plant or equipment are made redun dant, which suggests that there is no intent to acquire such physical assets and that "due process" has been provided for in accordance with the requirements of the Canadian Bill of Rights. An agreement between the Government of Canada and the Government of Manitoba was entered into pursuant to section 25 in which the Province undertook to make arrange ments for compensation and compensation was twice offered to the plaintiff and was refused.
Ulster Transport Authority v. James Brown and Sons Ltd. [1953] N.1. 79; Belfast Corporation v. O.D. Cars Ltd. [1960] A.C. 490 and MacAlpine v. Turk (1954) 12 W.W.R. (N.S.) 499, applied.
ACTION. COUNSEL:
K. M. Arenson, D'Arcy C. H. McCaffrey. Q.C., and J. S. Lamont for plaintiff.
L. P. Chambers and S. M. Lyman for defendant.
SOLICITORS:
Arenson & Company, Winnipeg, for plaintiff.
Deputy Attorney General of Canada for defendant.
The following are the reasons for judgment rendered in English by
COLLIER J.: The plaintiff company seeks a dec laration that it is entitled to compensation for property taken.' It alleges its business and good will were statutorily acquired by the defendant by reason of the Freshwater Fish Marketing Act 2 . A further declaration is sought that the
... Plaintiff is entitled to the fair market value of the said business as a going concern as at the 1st day of May 1969....
Most of the relevant and salient facts were admitted or agreed.
In 1920 at Oak Point, Manitoba, one Bercovitch started a freshwater fish business. In 1926 or 1927 he incorporated the plaintiff company (under a different name) and moved the headquarters of the operation to Winnipeg. Bercovitch died in 1948. The business passed to his widow and former employees. The witness Marder married the widow in 1951. Shortly after, the operation of the plain tiff occupied him full-time. His sister, his brother and his wife all worked in the business until May 1969.
The company, from its early days and at the relevant period here, bought fish from fishermen at various lakes in Manitoba. Those fishermen, the initial producers (if I can use that term), were not employees. But, over the years, the plaintiff and other similar fish marketers, in order to obtain their production, financed them. The fish were
' There are pending other actions where other companies
which had carried on freshwater fish businesses in Manitoba
are plaintiffs claiming similar relief against the defendant: Main Fisheries Ltd. v. The Queen (T-1417-75); Canadian Fish Producers Ltd. v. The Queen (T-1419-75); Bodner Fish Distributors Ltd. v. The Queen (T-1420-75); and Keystone Fisheries Ltd. v. The Queen (T-1731-75).
2 R.S.C. 1970, c. F-13. I shall, in these reasons, refer to the Act as "the Act", "the statute", or "the legislation". It was enacted February 27, 1969.
then processed in various ways and sold. The largest volume (approximately 85 to 90%) was sold to customers in the United States. The fresh water fish marketing business was a very competi tive one, particularly in the United States. I am satisfied, from the evidence of Mr. Marder, Mr. Lazarenko and Mr. Page, that the plaintiff com pany and others like it had, even in that highly competitive field, over the years, built up individu al clienteles. Bercovitch and his company enjoyed a good reputation. That reputation, on the evi dence, continued after Marder assumed command. The plaintiff, for understandable financial reasons, had from 1963 to 1969, cut back, somewhat, its operations. Nevertheless, it still retained a com petitive position and individual custom of its own.
The defendant contended that, on the evidence, the plaintiff company, as of May 1, 1969, had (in fact or in law) no "goodwill". Its financial returns for the fiscal years ending March 31, 1964 to March 31, 1969, from an accounting valuation point of view, it was argued, indicated there was no measurable economic goodwill in the company; even if the defendant had, in law, "taken" the plaintiff's business, there was, on the facts, no compensable goodwill; therefore the plaintiff had no cause of action.
I do not accept the contention that the plaintiff had, as of May 1, 1969, no goodwill. The Crown relied primarily on the evidence of Mr. Shields, a chartered accountant. He had examined the plain tiffs financial statements from 1964 to 1969. He was requested by the defendant to calculate, from an accountant's point of view, the "measurable" amount, if any, "... of goodwill which had an economic value to Manitoba Fisheries Ltd. immediately prior to ... May 1969." He said:
... goodwill in a business enterprise is ignored in an accounting sense except when it [the enterprise] is purchased and the amount determined at a particular point in time. [My italics.]
Measurable goodwill arises where a prospective purchaser pays more for the net assets of an enterprise than the fair value of the underlying assets.
He went on to illustrate and apply an accepted accounting mathematical formula, postulating a hypothetical sale. He concluded there was no mea surable goodwill.
In cross-examination however, he agreed that businessmen purchasers do not necessarily use an accountancy technique. He candidly agreed that a practical businessman, with market experience, might well have concluded there was, in fact, goodwill in a business sense and pay for it, though an accountant, using his techniques, might advise there was, mathematically, no goodwill, or even negative goodwill.
The defendant, on this aspect of the case, relied as well on a number of court decisions dealing with the meaning of goodwill and how, in individual cases, it may be calculated 3 . The cases cited arose under the Income Tax Act. They were essentially concerned with how "goodwill" should be treated, in the particular circumstances, for tax purposes.
Goodwill, in my view, must be here looked at in the commercial sense. That includes the approach of the practical businessman and not merely the mathematical dollar-and-cent approach of the chartered accountant. I rely on the following com ments of Lord MacDermott L.C.J. in Ulster Transport Authority v. James Brown and Sons Ltd. ' :
"Goodwill" is a word sometimes used to indicate a ready formed connection of customers whose custom is of value because it is likely to continue. But in its commercial sense the word may connote much more than this. It is, as Lord Mac- naghten observed in Inland Revenue Commissioners v. Muller & Co.'s Margarine Ltd. [1901] A.C. 217, 224, "the attractive force which brings in custom," and it may reside, not only in trade connections, but in many other quarters, such as particu lar premises, long experience in some specialised sphere, or the good repute associated with a name or mark. It is something generated by effort that adds to the value of the business.
3 Losey v. M.N.R. 57 DTC 1097; Dominion Dairies Ltd. v. M.N.R. [1966] Ex.C.R. 397; Butler v. M.N.R. [1967] 1 Ex.C.R. 425; Herb Payne Transport Ltd. v. M.N.R. [1964] Ex.C.R. 1. The classical cases on the subject of goodwill are reviewed in MacAlpine v. Turk (1954) 12 W.W.R. (N.S.) 499 by McPherson C.J.M. at pp. 502-503.
4 [1953] N.I. 79 at 109-110.
When the make-up of a well-established, profitable enterprise providing a special service (such as the respondents' furniture removing service) is examined I think it well-nigh impossible to disentangle the business that has been built up from its good will or to give the latter a single or precise meaning. I therefore approach the question under consideration on the basis that here the relevant loss is really a loss of goodwill in the commer cial sense and as described by Lord Macnaghten in Muller & Co.'s case.
The evidence satisfies me there was goodwill, in the legal and business sense, attaching to the plaintiff's operation. The economic or pecuniary value, for purposes of damages or compensation, may ultimately be small. The parties, in this case, stipulated the amount of compensation would be agreed on by the parties or, failing accord, deter mined by a judge of this Court. On that basis, the plaintiff did not call any evidence to calculate or establish a dollar-and-cent value.
I turn now to the alleged "taking" by the defendant of the plaintiffs business.
Sometime prior to 1969, an inquiry into the freshwater fish business in certain of the provinces and territories had been carried out. A report (referred to as the Mclvor report) was released in 1964-65. The report is not in evidence. I do not, therefore, know what, if any, the precise problems were in the freshwater fishing industry in Alberta, Saskatchewan, Manitoba, Ontario and the North west Territories. Nor do I know what the recom mendations were. In any event, at the request' of the four provinces and territories mentioned, the Freshwater Fish Marketing Act, earlier referred to, was passed.
The plaintiff asserts the legal and practical effect of this legislation, and the manner in which the powers conferred in the Act have been carried out or withheld, was to take from the plaintiff its goodwill and invest it in a government corporation without payment of compensation. It is further asserted the tangible assets, because the goodwill was taken, were rendered commercially valueless; again no compensation has been paid.
5 See Ex. 18.
The plaintiff concedes that in order to found its claim for compensation it must establish a statu tory right 6 . Reliance, however, is placed on the principles stated by Lord Atkinson in Attorney- General v. De Keyser's Royal Hotel, Ltd.':
The recognized rule for the construction of statutes is that, unless the words of the statute clearly so demand, a statute is not to be construed so as to take away the property of a subject without compensation.
and by Wilson J.A. of the British Columbia Court of Appeal in B.C. Power Corp. Ltd. v. Attorney- General of British Columbia 8 :
But I do cite these general statements from Maxwell on Interpretation of Statutes, 11th ed., pp. 275-7:
Statutes which encroach on the rights of the subject, whether as regards person or property, are similarly subject to a strict construction in the sense before explained. It is a recognized rule that they should be interpreted, if possible, so as to respect such rights .... Proprietary rights should not be held to be taken away by Parliament without provision for compensation unless the legislature has so provided in clear terms. It is presumed, where the objects of the Act do not obviously imply such an intention, that the legislature does not desire to confiscate the property or to encroach upon the right of persons, and it is therefore expected that, if such be its intention, it will manifest it plainly if not in express words at least by clear implication and beyond reasonable doubt. It is a proper rule of construction not to construe an Act of Parliament as interfering with or injuring persons' rights without compensation, unless one is obliged so to construe it.
Lord Radcliffe in Belfast Corporation v. O.D. Cars Ltd. 9 set out the approach to be adopted in
6 Sisters of Charity of Rockingham v. The King [1922] 2 A.C. 315 at 322 (P.C.); The King v. Thomas Lawson do Sons Ltd. [1948] Ex.C.R. 44 at 57.
[1920] A.C. 508 at 542.
8 (1962) 34 D.L.R. (2d) 25 at page 44.
9 [1960] A.C. 490 at 523 (H.L.(N.I.)). In the summary of argument on behalf of the respondent, reported at p. 509, the following appears:
Parliament will not be presumed to intend to take away property without compensation. This will influence the courts in their interpretation of Acts of Parliament to the point that they will refuse to credit the legislature with such an inten tion unless the words used are clear and unassailable; though if Parliament expresses such an intention clearly, the courts must, of course, give effect to it.
That seems to me to be a succinct summary of the authorities.
considering whether a particular piece of legisla tion contemplates a "taking without compensa tion":
On the one hand, there would be the general principle, accepted by the legislature and scrupulously defended by the courts, that the title to property or the enjoyment of its possession was not to be compulsorily acquired from a subject unless full compen sation was afforded in its place. Acquisition of title or posses sion was "taking." Aspects of this principle are found in the rules of statutory interpretation devised by the courts, which required the presence of the most explicit words before an acquisition could be held to be sanctioned by an Act of Parliament without full compensation being provided, or imported an intention to give compensation and machinery for assessing it into any Act of Parliament that did not positively exclude it. This vigilance to see that the subject's rights to property were protected, so far as was consistent with the requirements of expropriation of what was previously enjoyed in specie, was regarded as an important guarantee of individual liberty. It would be a mistake to look on it as representing any conflict between the legislature and the courts. The principle was, generally speaking, common to both.
In the present case it seems to me there are two questions to determine, and in the following order:
(1) Was the intention and effect of the legisla tion to "take" the business and goodwill of the plaintiff and of others like it?
(2) If so, was there a clear legislative intent to take without compensation?
It is necessary to consider the Act in some detail. At the outset it established a corporation, the Freshwater Fish Marketing Corporation, having a board of directors 10 . There is one director for each participating province, plus four others" The Corporation is an agent of Her Majesty in right of Canada (the federal Crown). Any prop erty acquired by the Corporation becomes the property of the federal Crown. The Corporation was established
... for the purpose of marketing and trading in fish, fish products and fish by-products in and out of Canada....
For that purpose it was given certain other statu tory powers. 12
10 See s. 3.
11 For "participating province" see s. 2 and s. 25.
12 See paras. 7(a) to (i). An advisory Committee advises the Corporation (s. 18 and s. 19).
I turn to Part III of the legislation. By section 23 the Corporation:
... has the exclusive right to market and trade in fish in interprovincial and export trade and shall exercise that right, either by itself or by its agents, with the object of
(a) marketing fish in an orderly manner;
(b) increasing returns to fishermen; and
(c) promoting international markets for, and increasing interprovincial and export trade in, fish.
The exclusive right is confined to species of fish (set out in a Schedule) fished for commercial purposes in a participating province. 13
Section 21(1) provides:
21. (1) Except in accordance with the terms and conditions set forth in any licence that may be issued by the Corporation in that behalf, no person other than the Corporation or an agent of the Corporation shall
(a) export fish from Canada;
(b) send, convey or carry fish from a participating province to another participating province or to any other province;
(c) in a participating province, receive fish for conveyance or carriage to a destination outside the province; or
(d) sell or buy, or agree to sell or buy fish situated in a participating province for delivery in another participating province or any other province, or outside Canada.
My last reference is to section 25. It authorizes Canada to enter into agreements with Alberta, Saskatchewan, Manitoba, Ontario or the North west Territories 14 providing for, inter alia:
25. (2) .. .
(c) the undertaking by the province of arrangements for the payment, to the owner of any plant or equipment used in storing, processing or otherwise preparing fish for market, of compensation for any such plant or equipment that will or may be rendered redundant by reason of any operations authorized to be carried out by the Corporation under this Part.....
After consideration of the whole statute, I have concluded the legislation does not purport to take any property from anyone in the participating provinces, with or without compensation.
13 See s. 20.
14 Section 22 of the Act permits Canada, by regulation, to exempt from the provisions of Part III any area or region in a participating province, or any transaction, person, or class of transactions or persons.
As I see it, the intent or purpose was to set up a corporation for the purpose of marketing or trad ing in fish, with the object of orderly marketing, increasing returns to fishermen, and promoting markets and trade. To accomplish those objects, the Corporation was given exclusive rights. Licences can, however, be issued to others allowing them to participate in the export of, and interpro- vincial marketing and trading in, freshwater fish.
In my view, any person or company in a business such as that carried on by the plaintiff could continue in the business, provided a licence was obtained from the Corporation, or if the federal government, by regulation, excluded them from the application of Part III of the statute. The legislation envisages the granting of licences to exporters and others. It is silent as to the circum stances under which a particular person might be issued a licence. It is true the licence-granting power is permissive, or discretionary. Nevertheless, it seems to me, when one examines the whole scheme of the Act, there was no intention to take or confiscate, for the Crown, any property. If that is so, then the second question I have posed does not arise.
The plaintiff contends, however, that one must look beyond the black letter words of the legisla tion. If the Corporation refuses to issue any licences and the federal Crown refuses to exempt any persons from the application of Part III, then the practical result is the taking or confiscating of the business of all private freshwater fish exporters and dealers. The plaintiff says one cannot close one's eyes to what actually happened. The Corpo ration went into business on May 1, 1969. Part III, with the prohibitions set out in section 21 (subject to the granting of licences), came into effect at the same time. No licences have ever been issued by the Corporation. No persons have been exempted from the application of Part III 15
The Corporation, from the outset, because there was no other source of supply, obtained the trade of the United States customers of the plaintiff and its Manitoba competitors. Mr. Brooker, the sales manager of the Corporation, frankly conceded that
15 In some manner, only a portion of western Ontario is subject to Part III of the legislation.
to be the case. It is quite true the Corporation did not purchase from the plaintiff and its competitors any property, customers' lists or any other kind of tangible, intangible or commercial rights. Because all competition was effectively prohibited, the spe cialty buyers in the United States looked to, after May 1, 1969, only one producer, one exporter, and one seller.
The plaintiff urges that the natural consequence of this legislation and the exercise of the Corpora tion's power has been to divert to the federal Crown the business (or a substantial part of it) which the plaintiff and others are no longer allowed to transact.
Ulster Transport Authority v. James Brown and Sons Ltd. 16 is relied upon as a strikingly relevant authority. Northern Ireland had a constitutional guarantee prohibiting Parliament from making " ... a law so as either directly or indirectly to . . . take any property without compensation." By legislation enacted in 1935 there was a general transfer, to a public authority, of various private road transport undertakings. The statute provided for payment of compensation to the former owners. They, in turn, were forbidden, to compete with the board. An exception was made in the case of persons carrying on the business of moving and storing furniture. The respondent James Brown and Sons Ltd. had been in that / business since 1898. The legislation was, in 1948, carried further. It transferred all the assets and powers of the former road transport board to the Ulster Trans port Authority (the appellant). At the same time the exemption, which had allowed the respondent and others to operate in competition with the board in respect of furniture /moving, was effec tively repealed. The Authority, as with the previ ous board, could, however, consent (with the approval of the ministry) to the use of motor vehicles on public highways for the moving of furniture. No consent, of course, was given to the respondent. The respondent challenged the legisla tion as violating the constitutional guarantee of "taking property without compensation."
16 [1953] N.I. 79.
It succeeded. Lord MacDermott L.C.J., in respect of the power of the Authority to give consent, said this at pages 105-106:
And, in order to dispose of the point, I may add here that the provision as to consent and approval has, in my opinion, no material bearing on the matters raised by this appeal. If the relevant prohibition would otherwise offend as being ultra vires the Parliament of Northern Ireland, it is not to be redeemed by a dispensing power committed to the unfettered discretion of a Ministry or, a fortiori, of a trade competitor. In James v. Cowan [1932] A.C. 542, 558 Lord Atkin said: "The Constitu tion is not to be mocked by `substituting executive for legisla tive interference' with freedom." This dictum was directed to a different situation, but the underlying principle is the same. The limits of legislative power can no more be evaded by authorising someone to avert at his pleasure the consequence of what transgresses in the statute itself than they can by leaving the doing of what is forbidden to someone's discretion.
As to the intent or purpose of the particular legislation, Lord MacDermott said, at page 111:
The next question is whether the effect of the relevant prohibition is "to take" the property thus lost. This verb was the subject of much argument, most of it referable to two submissions advanced on behalf of the appellants as follows: (1) "to take" means to acquire or take over and thus signifies a transfer or passing of property from one to another, in contra distinction to a taking away without acquisition, as by dissipa tion or destruction; and (2) a mere prohibition is not a taking whatever else "to take" may connote....
Then, at pages 112-113:
I am of the opinion that even on the argument of the appellants the respondents' property would be taken contrary to section 5(1). I think it would be taken over and not just taken away, and I think this would not only be the effect but would also be in accordance with the intention of the impugned legislation. Now if that is right—and I shall say why I think it is right in a moment—then, although the Parliament of Northern Ireland has said nothing in plain terms about the acquisition of any part of any furniture remover's business, section 5 would undoubtedly be contravened because it forbids a taking by indirect as well as by direct means and therefore strikes at any legislative device designed and sufficient to achieve acquisition without compensation though not purporting to do so.
A colourable device of this nature ought not to be ascribed readily to the Legislature, but when the nature of the relevant legislation and of its consequences, as illustrated by the findings in the case, are considered I can see no escape from the conclusions I have mentioned. So far as the statute book is concerned one has first a general acquisition of road motor undertakings on payment of compensation for intangible as well as tangible assets (as the Second Schedule to the Act of 1935 shows). But the undertakings of furniture removers and storers are excepted and the owners are left free to ply their trade. Then, with no further provision as to acquisition with
compensation, these owners are forbidden to carry on a sub stantial part of their business. What is the reason for this change? It cannot lie in the unforeseen consequence of some inadvertent omission or unrecognised slip. The divergence be tween section 15(4)(e)(iii) of the Act of 1935 and section 19(1)(d) of the Act of 1948 is unmistakably deliberate and intentional. But what was the intention? Parliament must be presumed to intend the necessary effect of its enactments, and the answer to this question cannot overlook the fact that in this specialised field—and here the facts are very different from those of Benson's case [1940] N.I. 133—the natural conse quence of the enforcement of the relevant prohibition would be to divert to the appellants the business, or at least the substan tial part of the business, which their erstwhile competitors were no longer allowed to transact. The transfer might not be 100 per cent., but few people can manage more than small lifts for themselves and it is hard to see where the bulk of the business could legitimately go if it did not pass to the appellants. Nor could the appellants well stand aloof from such business, if there was no one else to do it, having regard to the nature of their duty to provide for the needs of the public as imposed by section 5 of the Act of 1948. I think, therefore, that the legislation and the nature of its subject matter justify the answer that the intention was to enable the appellants to capture the prohibited business, and to do so without expense. I can find no other intention which offers a more likely explana tion of the provisions in question; and counsel for the appel lants, when invited to suggest some other view which would fit the circumstances as well or better were unable to advance an alternative.
and again, at page 114:
In my opinion these findings show that the relevant prohibition will have the effect which, according to the view I have expressed, was intended and they therefore support that view. In referring to finding (14) I do not, of course, mean to suggest that the intention of the appellants necessarily reflects that of the Legislature. The relevance of that finding, as I see it, lies in this that it goes to show that the scheme of the challenged legislation was such as to offer the appellants a ready and practical means of acquiring the respondents' goodwill without paying for it.
I should add, before going further, that I see no reason to speculate upon the motives of the Legislature in enacting this particular piece of legislation. Whatever in fact those motives may have been, the intention of the Legislature, as gleaned from its terms, is what must guide the court in this instance.
In my opinion, the Ulster Transport Authority case is distinguishable. There, the clear purpose of the 1948 legislation was, in one form or another, to take over the furniture-moving business. No provi sion was made for compensation and the legisla tion therefore violated the constitutional guarantee.
I am not persuaded there was, in the Freshwater Fish Marketing Act, any attempt, indirectly or by colorable means, to capture or take the existing
property, business or goodwill of the plaintiff and others. The scheme was the setting up of an exclu sive marketing corporation, subject to a licensing system. Unfortunately, and to date, the Corpora tion has, in its wisdom, decided not to issue any licences. The practical effect has been to put the plaintiff and others out of business. I sympathize. I can only interpret the statute, and so apply the law. I cannot alter it.
I have not overlooked paragraph 25(2)(c) of the Act. It envisages a participating province, in this case Manitoba, paying persons such as the plain tiff compensation
... for any such plant or equipment that will or may be rendered redundant by reason of any operations authorized to be carried out by the Corporation....
In my view, that does not indicate an intent to acquire the physical assets of the plaintiff or others. The Corporation has set up its own plant. If that undertaking and its physical facilities have the effect of making, in the production of fish for market, equipment or plant of the plaintiff super fluous, then some kind of limited compensation is contemplated. I note the paragraph does not specifically provide that any persons affected are indubitably entitled to compensation; the inference seems to be there. There is, however, no intention, inference, or suggestion the federal Crown should be the direct source of such compensation. The section merely authorizes the federal minister to enter into agreements with participating provinces for a number of things, including the undertaking by the province of arrangements for compensation payment.
An agreement has been entered into between Canada and Manitoba (June 4, 1969). Section 5 of that agreement provides:
The Province undertakes to make any arrangements neces sary with the owner of any plant or equipment in the Province of Manitoba used in storing, processing or otherwise preparing fish for market, for compensation for any such plant or equip ment that will or may be rendered redundant by reason of any operations authorized to be carried out by the Corporation under the Act.
Finally, the plaintiff relied on the Canadian Bill
of Rights 17 . Paragraph 1(a) provides:
1. It is hereby recognized and declared that in Canada there have existed and shall continue to exist without discrimination by reason of race, national origin, colour, religion or sex, the following human rights and fundamental freedoms, namely,
(a) the right of the individual to life, liberty, security of the person and enjoyment of property, and the right not to be deprived thereof except by due process of law;
Paragraph 2(e) reads:
2. Every law of Canada shall, unless it is expressly declared by an Act of the Parliament of Canada that it shall operate notwithstanding the Canadian Bill of Rights, be so construed and applied as not to abrogate, abridge or infringe or to authorize the abrogation, abridgment or infringement of any of the rights or freedoms herein recognized and declared, and in particular, no law of Canada shall be construed or applied so as to
(e) deprive a person of the right to a fair hearing in accord ance with the principles of fundamental justice for the deter mination of his rights and obligations;
Mr. Lamont made an elaborate and careful argument in respect of the application of those provisions. He contended the effect of the freshwa ter fish legislation was to infringe the right of the plaintiff not to be deprived of property except by due process of law; the legislation appears to authorize, from a practical point of view, the Corporation to do just that; Parliament has not expressly declared the legislation shall operate not withstanding the Canadian Bill of Rights; there fore the Court must construe the statute as not depriving the plaintiff of its property, except after due process; due process includes the right to compensation.
I have already concluded the legislation, when properly construed, does not purport to take, or authorize the taking of, the property of anyone. Nor, on a reasonable and fair interpretation, does it purport to deprive anyone, or authorize a gov ernment corporation to deprive anyone, of the enjoyment of his property. In my opinion, that interpretation is reasonably arrived at, without resort to the principles set out in the Canadian Bill of Rights.
The plaintiff's action must, unfortunately, be dismissed.
17 R.S.C. 1970, App. III. I have underlined the particular portions on which the plaintiff relies.
I cannot conclude without referring to certain other matters put in evidence. In my opinion, they do not make for a change in the legal result.
The plaintiff and its erstwhile competitors, all of whom have, on a realistic view, been put out of business, have endeavoured, short of litigation, to obtain recompense. The Province of Manitoba ini tially offered the plaintiff $1,250. This was for plant and equipment pursuant to the "redundan- cy" provision of paragraph 25(2)(c) of the statute ' 8 . The first offer was $1,250. A second offer, dated Sept. 8, 1972, was for $4,104. It was based on a disposal allowance of 25 per cent of the estimated depreciated value of the plaintiff's equipment. Both were refused. No further offers have been made.
On Jan. 24, 1974, Mr. Davis, then the federal Minister of Fisheries, wrote the plaintiff and other companies as follows:
Ottawa, Ontario
K1A 0H3
Jan. 24, 1974.
Northern Lakes Fisheries Company, 904-99 Wellington Crescent,
Winnipeg 9, Manitoba.
Gentlemen:
Your telex of December 18, 1973, to the Prime Minister, has been forwarded to me for reply.
I share your disappointment at the unwillingness of the Manitoba Government to provide additional compensation to your firm and others who were put out of business as a result of the establishment of the Freshwater Fish Marketing Corpora tion. I disagree with you that we have broken our promise. I am sure you know that the Freshwater Fish Marketing Act was passed at the request of the provincial governments, and although the Act provided for compensation for assets no longer required in the industry, the responsibility for making payments rests with the provinces. In a spirit of partnership, the Government of Canada subsequently offered to reimburse the provinces up to 50 percent of payments made.
18 The terms "redundant" and "redundancy" enjoy, these days, popularity in usage. In paragraph 25(2)(c) I assume the draftsman had in mind the situation where, by reason of the Corporation's operations, other people's plant and equipment became, in the storing, processing, and preparation process, superfluous or unnecessary. In this case, however, the plaintiff's whole operation became "redundant", in the sense of oblitera tion. Redundant, at first blush, appears to be a somewhat innocuous term; it can embrace devastating situations.
Although it was generally agreed that compensation was with respect to assets, the Government is now prepared to accept for purposes of compensation, that the assets could be valued on the basis of an ongoing business; such payments have already been made to the Alberta Government.
With respect to your request that we help you to bring this matter before the Courts, I find it difficult to see how this might be accomplished.
As you know, I have already written to the minister respon sible in Manitoba asking him to review the level of compensa tion and offering to share in the payment of any additional compensation. This offer was refused.
Yours sincerely, Jack Davis.
On the evidence before me the plaintiff and his former competitors, to my mind, have been unfair ly treated. They are taxpayers and citizens of both Manitoba and Canada, entrapped in policy differ ences between two levels of government 19 . They have been economically erased. Redress, I hold, cannot be had against the federal Crown. It seems unlikely it can be had against the provincial Crown. Any recompense, it appears, would be purely ex gratia.
My comments are predicated on the evidence put before me. There may be other facts, unknown to me but known to governments and those in the industry, which could well persuade me to recant my criticisms.
Based only on what I heard in the court room, I suggest the plaintiff ought to receive better treat ment from its governments. This Court cannot change the law. Its function is to interpret, (where necessary), and apply it. I have endeavoured to do that in this case. The law, as I see it, compels rejection of the plaintiff's claim for compensation. It does not follow that justice, in the true sense, has been done.
The action is dismissed. The defendant is en titled to costs.
19 In Alberta, by contrast, appropriate provincial legislation was passed which in some ways complemented the federal statute in respect of compensation for loss of plant and equip ment. The provincial legislation expressly provided for compen sation to be paid (goodwill was not included), and an appeal from the award. See Quality Fish Producers Ltd. v. Minister of Lands and Forests [I973] 4 W.W.R. 720 (App. Div., S.C.A.).
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