Province of Ontario v. The Dominion of Canada and Province of Quebec. In re Indian Claims

Province of Ontario v. The Dominion of Canada and Province of Quebec. In re Indian Claims
Collection
Supreme Court Judgments
Date
1895-12-09
Report
(1895) 25 SCR 434
Judges
King, George Edwin; Gwynne, John Wellington; Taschereau, Henri-Elzéar; Sedgewick, Robert; Strong, Samuel Henry
On appeal from
Federal Court of Appeal
Subjects
Constitutional law
Decision Content
Supreme Court of Canada
The Province of Ontario v. The Dominion of Canada and the Province of Quebec (1895) 25 SCR 434
Date: 1895-12-09
The Province of Ontario
Appellant
And
The Dominion of Canada and the Province of Quebec
Respondents
In re INDIAN CLAIMS.
1895: May 15, 16; 1895: Dec. 9.
Present:—Sir Henry Strong C.J., and Taschereau, Gwynne, Sedgewick and King JJ.
ON APPEAL FROM AN AWARD IN AN ARBITRATION RESPECTING PROVINCIAL ACCOUNTS.
Constitutional law—Province of Canada—Treaties by, with Indians—Surrender of Indian lands—Annuity to Indians—Revenue from lands—Increase of annuity—Charge upon lands—B.N.A. Act s. 109.
In 1850 the late province of Canada entered into treaties with the Indians of the Lake Superior and Lake Huron districts, by which the Indian lands were surrendered to the Government of the province in consideration of a certain sum paid down and an annuity to the tribes, with a provision that "should all the territory thereby ceded by the Indians at any future period produce such an amount as will enable the government of this province, without incurring loss, to increase the annuity hereby secured to them, then, and in that case, the same shall be augmented from time to time."
By the B.N.A. Act the Dominion of Canada assumed the debts and liabilities of the province of Canada, and sec. 109 of that Act provided that all lands, &c., belonged to the several provinces in which the same were situate "subject to any trust existing in respect thereof, and to any interest other than that of the province in the same."
The lands so surrendered are situate in the province of Ontario and have for some years produced an amount sufficient for the payment of an increased annuity to the Indians. The Dominion Government has paid the annuities since 1867 (from 1874 at the increased amount) and claims to be reimbursed therefor.
Held, reversing the said award, Gwynne and King JJ. dissenting, that the provision in the treaties as to increased annuities had not the effect of burdening the lands with a "trust in respect thereof" or "an interest other than that of the province in the same," within the meaning of said sec. 109, and therefore Ontario held the lands free from any trust or interest, and was not solely liable for repayment to the Dominion of the increased annuities, but only liable jointly with Quebec as representing the province of Canada.
Appeal from an award of the arbitrators appointed to adjust the accounts between the Dominion of Canada and the provinces of Ontario and Quebec respectively.
The circumstances under which this appeal came before the court were the following:
Prior to and in the year 1850 the Ojibeway Indians inhabited large tracts of land on the eastern and northern shores of Lake Huron, and on the northern shore of Lake Superior, which tracts of land were at that time within the boundaries of the then province of Canada, but since the year 1867 are within the province of Ontario. At the date first above mentioned, 1850, the administration of Indian affairs within the province of Canada was in the hands of Her Majesty the Queen, and the management of the business with the said Indians was conducted by officers and agents appointed by the Government of Great Britain.
In the said year 1850 the Honourable William Benjamin Robinson was duly authorized by Her Majesty, represented by the Government of the province of Canada, to negotiate and enter into agreements with the above named Indians for the extinguishment of their title to, and to obtain cessions of, portions of the tracts of land occupied and inhabited by them, for the purpose of opening up the said lands for settlement, and developing the mineral resources of the same, and on the 9th day of September. 1850, an agreement was entered into between the said Hon. W. B. Robinson on behalf of the Queen and the Ojibeway Indians of the Lake Huron district, which agreement is in the words and figures following: "This agreement made and entered into this ninth day of September, in the year of Our Lord one thousand eight hundred and fifty, at Sault Ste. Marie, in the province of Canada, between the Honourable William Benjamin Robinson of the one part, on behalf of Her Majesty the Queen, and (naming them) principal men of the Ojibeway Indians, inhabiting and claiming the eastern and northern shores of lake Huron, from Penetan-guishene to Sault Ste. Marie, and thence to Batchewanaung Bay, on the northern shore of Lake Superior, together with the islands in the said lakes opposite to the shores thereof, and inland to the height of land which separates the territory covered by the charter of the Honourable Hudson Bay Company from Canada; as well as all unconceded lands within the limits of Canada west to which they have any just claim on the other part, witnesseth:"
"That for and in consideration of the sum of two thousand pounds of good and lawful money of Upper Canada, to them in hand paid, and for the further perpetual annuity of six hundred pounds of like money, the same to be paid and delivered to the said chiefs and their tribes at a convenient season of each year, of which due notice will be given at such places as may be appointed for that purpose, they, the said chiefs and principal men, on behalf of their respective tribes or bands, do hereby fully, freely and voluntarily surrender, cede, grant and convey unto Her Majesty, her heirs and successors forever, all their right, title and interest to and in the whole of the territory above described, save and except the reservations set forth in the schedule hereunto annexed, which reservations shall be held and occupied by the said chiefs and their tribes in common, for their own use and benefit; and should the said chiefs and their respective tribes at any time desire to dispose of any part of such reservations, or of any mineral or other valuable productions thereon, the same will be sold or leased at their request by the Superintendent-General of Indian Affairs for the time being, or other officer having authority so to do, for their sole interest and to the best advantage; and the said William Benjamin Robinson of the first part, on behalf of Her Majesty and the Government of this province, hereby promises and agrees to make, or cause to be made, the payments as above mentioned; and further to allow the said chiefs and their tribes the full and free privilege to hunt over the territory now ceded by them, and to fish in the waters thereof, as they nave hitherto been in the habit of doing, saving and excepting such portions of the said territory as may from time to time be sold or leased to individuals, or companies of individuals, and occupied by them with the consent of the provincial Government."
"The parties of the second part further promise and agree that they will not sell, lease or otherwise dispose of any portion of their reservations without the consent of the Superintendent-General of Indian Affairs, or other officer of like authority, being first had and obtained. Nor will they at any time hinder or prevent persons from exploring or searching for minerals or other valuable productions in any part of the territory hereby ceded to Her Majesty as before mentioned. The parties of the second part also agree, that in case the government of this province should before the date of this agreement have sold, or bargained to sell, any mining locations or other property on the portions of the territory hereby reserved for their use, then and in that case such sale, or promise of sale, shall be perfected by the government if the parties claiming it shall have fulfilled all the conditions upon which such locations were made, and the amount accruing therefrom shall be paid to the tribe to whom the reservation belongs." "The said William Benjamin Robinson on behalf of Her Majesty, who desires to deal liberally and justly with all her subjects, further promises and agrees that should the territory hereby ceded by the parties of the second part at any future period produce such an amount as will enable the government of this province, without incurring loss, to increase the annuity hereby secured to them, then, and in that case, the same shall be augmented from time to time, provided that the amount paid to each individual shall not exceed the sum of one pound provincial currency in any one year, or such further sum as Her Majesty may be graciously pleased to order; and provided further, that the number of Indians entitled to the benefit of this treaty shall amount to two-thirds of their present numbers (which is twelve hundred and forty) to entitle them to claim the full benefit thereof, and should their numbers at any future period not amount to two-thirds of twelve hundred and forty the annuity shall be diminished in proportion to their actual numbers."
A similar treaty was entered into with the Lake Superior Indians in which the annuity to be paid was £600 and the number in the tribe was stated to be fourteen hundred and twenty-two.
On the union of the provinces in 1867 the Dominion became liable for the debts of the several provinces as provided in sections 111, 112 and 142 of the British North America Act, which are as follows:
"111. Canada shall be liable for the debts and liabilities of each province existing at the union.
"112. Ontario and Quebec conjointly shall be liable to Canada for the amount (if any) by which the debt of the province of Canada exceeds at the union sixty-two million five hundred thousand dollars, and shall be charged with interest at the rate of five per centum per annum thereon." "142. The division and adjustment of the debts, credits, liabilities, properties and assets of Upper Canada and Lower Canada shall be referred to the arbitrament of three arbitrators, one chosen by the government of Ontario, one by the government of Quebec, and one by the government of Canada; and the selection of the arbitrators shall not be made until the parliament of Canada and the legislatures of Ontario and Quebec have met; and the arbitrator chosen by the government of Canada shall not be a resident either in Ontario or in Quebec."
In accordance with the last named section arbitrators were chosen, and on the third day of September, 1870, two of them, namely, Hon. John Hamilton Gray and Hon. D. L. MacPherson, gave their award, paragraphs 1 and 13 of which are as follows:
"I. That the amount by which the debt of the late province of Canada exceeded on the thirtieth day of June, one thousand eight hundred and sixty-seven, sixty-two millions five hundred thousand dollars, shall be and is hereby divided between and apportioned to, and shall be borne by, the said provinces of Ontario and Quebec respectively, in the following proportions, that is to say—the said province of Ontario shall assume and pay such a proportion of the said amount as the sum of nine millions eight hundred and eight thousand seven hundred and twenty-eight dollars and two cents bears to the sum of eighteen millions five hundred and eighty-seven thousand five hundred and twenty dollars and fifty-seven cents; and the said province of Quebec shall assume and pay such a proportion of the said amount as the sum of eight millions seven hundred and seventy-eight thousand and seven hundred and ninety-two dollars and fifty-five cents bears to the sum of eighteen millions five hundred and eighty-seven thousand five hundred and twenty dollars and fifty-seven cents."
"XIII. That all the lands in either of the said provinces of Ontario and Quebec respectively, surrendered by the Indians in consideration of annuities to them granted, which said annuities are included in the debt of the late province of Canada, shall be the absolute property of the province in which the said lands are respectively situate, free from any further claim upon, or charge to the said province in which they are so situate by the other of the said provinces."
In 1891 the Parliament of Canada passed the Act 5 & 55 Vic. ch. 6, which contained the following provisions:
"An Act respecting the settlement of accounts between the Dominion of Canada and the provinces of Ontario and Quebec, and between the said provinces."
[Assented to July 10th, 1891.]
"Whereas certain accounts have arisen or may hereafter arise in the settlement of the accounts between the Dominion of Canada and the Provinces of Ontario and Quebec both jointly and severally, and between the two provinces, concerning which no agreement has hitherto been arrived at; and whereas it is advisable that all such questions of account should be eferred to arbitration: Therefore Her Majesty, by and with the advice and consent of the Senate and House of Commons of Canada, enacts as follows:"
"1. For the final and conclusive determination of such accounts, the Governor General in Council may unite with the Governments of the Provinces of Ontario and Quebec in the appointment of three arbitrators, to whom shall be referred such questions as the Governor General and the Lieutenant-Governors of the said provinces shall agree to submit." "2. The arbitrators shall consist of three judges, one to be appointed by the Governor General in Council and one by each of the said Provincial Governments, and all three shall be approved of by each Government."
"3. The arbitrators shall not assume to decide any disputed constitutional question, but if any are raised they will note and report them with their award but without delaying the proceedings."
"4. Any two of the arbitrators shall have power to make an award."
"5. The arbitrators, or any two of them, shall have power to make one or more awards, and to do so from time to time."
"6. The arbitrators shall not be bound to decide according to the strict rules of law or evidence, but may decide upon equitable principles, and when they do proceed on their view of a disputed question of law the award shall set forth the same at the instance of either or any party. Any award made under this Act shall be, in so far as it relates to disputed questions of law, subject to appeal to the Supreme Court of Canada and thence to the Judicial Committee of Her Majesty's Privy Council, in case their Lordships are pleased to allow such appeal."
"7. In case of an appeal on a question of law being-successful the matter shall go back to the arbitrators for the purpose of making such changes in the award as may be necessary or an appellate court shall make any other direction as to the necessary changes."
"8. The appointment of the said arbitrators by Order in Council and their award in writing shall be binding on Canada, save in case of appeal on questions of law, in which case the final decision thereon shall be binding on Canada."
"9. In case of a vacancy by death or otherwise among the arbitrators, the same shall be filled in the same manner as the appointment was first made, any such appointment to be approved of by the other two Governments."
In the same year the legislature of Ontario passed an Act 54 Vic. ch. 2, and the legislature of Quebec passed 54 Vic. ch. 4, each of which was identical in terms with the above Dominion statute.
In accordance with the provisions of the said statutes the Hon. John A. Boyd, Chancellor of Ontario; the Hon. Sir Louis Napoleon Casault, Chief Justice of the Superior Court of Quebec; and the Hon. George W. Burbidge, Judge of the Exchequer Court of Canada, were appointed arbitrators and the counsel for the three governments entered into an agreement of submission which provided that certain matters should be referred to said arbitrators including:
"1. All questions relating to or incident to the accounts between the Dominion and the Provinces of Ontario and Quebec, and to accounts between the two Provinces of Ontario and Quebec."
"2. The accounts are understood to include the following particulars":
"(d) The claims made by the Dominion Government on behalf of Indians, and payments made by the Government to Indians, to form part of the reference."
"(e) The arbitrators to apportion the liability of Ontario and Quebec as to any claim allowed the Dominion Government, and to apportion between Ontario and Quebec any amount found to be payable by the said Government."
The arbitrators made and published an award in respect of the claim of the Dominion for re-payment of the sums paid to the Indians under the above mentioned treaties, which award with the reasons given by the several arbitrators for the conclusion reached therein is as follows: "AWARD ON INDIAN ROBINSON TREATIES, HURON AND SUPERIOR.
13th February, 1895.
"To all to whom these presents shall come:
"The Honourable John Alexander Boyd, of the city of Toronto, and province of Ontario, Chancellor of the said province; the Honourable Sir Louis Napoleon Casault, of the city of Quebec, in the province of Quebec, Chief Justice of the Superior Court of the said' province of Quebec; and the Honourable George Wheelock Burbidge, of the city of Ottawa, in the said province (of Ontario), Judge of the Exchequer Court of Canada,—Send greeting."
"Whereas it was in and by the Act of the Parliament of Canada, 54 & 55 Victoria, chapter 6, and in and by an Act of the Legislative Assembly of Ontario, 54 Victoria, chapter 2, and in and by an Act of the Legislature of Quebec, 54 Victoria, chapter 4, among other things provided that for the final and conclusive determination of certain questions and accounts which had arisen or which might arise in the settlement of accounts between the Dominion of Canada and the provinces of Ontario and Quebec, both jointly and severally, and between the two provinces, concerning which no agreement had theretofore been arrived at, the Governor General in Council might unite with the Governments of the provinces of Ontario and Quebec in the appointment of three arbitrators, being judges, to whom should be referred such questions as the Governor General and Lieutenant-Governors of the provinces should agree to submit;"
"And whereas we, the undersigned John Alexander Boyd, Sir Louis Napoleon Casault, and George Wheelock Burbidge, have been duly appointed under the said Acts and have taken upon ourselves the burdens thereof;" "And whereas it was provided in and by the said Acts that such arbitrators, or any two of them, should have power to make one or more awards, and to do so from time to time;"
"And whereas certain questions respecting a claim made by the Dominion of Canada against the provinces of Ontario and Quebec in respect of Indian claims arising out of the Robinson treaties, and respecting a certain other claim made by the Dominion of Canada against the province of Ontario for certain immigration expenditure, and a certain other claim made by the province of Ontario against the Dominion of Canada in the first instance, and by notice to the province of Quebec against that province, for the recovery of a balance of the Upper Canada Municipalities' Fund, have been submitted to such arbitrators, and they have heard the parties thereto;"
"Now, therefore, the said arbitrators exercising their authority to make a separate award at this time respecting the said matters, do award, order and adjudge in and upon the premises as follows, that is to say:"
"I. In respect of the claim made by the Dominion of Canada against the provinces of Ontario and Quebec in reference to the Indian claims arising under the Robinson treaties:"
"1. That if in any year since the treaties in question were entered into the territory thereby ceded produced an amount which would have enabled the government, without incurring loss, to pay the increased annuities thereby secured to the Indian tribes mentioned therein, then such tribes were entitled to such increase not exceeding $4 for each individual."
"2. That the total amount of annuities to be paid under each treaty is, in such case, to be ascertained by reference to the number of Indians from time to time belonging to the tribes entitled to the benefit of the treaties. That is, that in case of an increase in the number of Indians beyond the numbers named in such treaties, the annuities, if the revenues derived from the ceded territory permitted, without incurring loss, were to be equal to a sum that would provide $4 for each Indian of the tribes entitled."
"3 That any excess of revenue in any given year may not be used to give the increased annuity in a former year in which an increased annuity could not have been paid without loss, but that any such excess or balance of revenue over expenditure in hand at the commencement of any given year should be carried forward into the account of that year."
"4. That any liability to pay the increased annuity in any year before the union was a debt or liability which devolved upon Canada under the 111th section of the British North America Act, 1867, and that this is one of the matters to be taken into account in ascertaining the excess of debt for which Ontario and Quebec are conjointly liable to Canada under the 112th section of the Act; and that Ontario and Quebec have not, in respect of any such liability, been discharged by reason of the capitalization of the fixed annuities, or because of anything in the Act of 1873, 36 Vic. c. 30."
"5. That interest is not recoverable upon any arrears of such annuities."
"6. That the ceded territory mentioned became the property of Ontario under the 109th section of The British North America Act, 1867, subject to a trust to pay the increased annuities on the happening, after the union, of the event on which such payment depended, and to the interest of the Indians therein to be so paid. That the ultimate burden of making provision for the payment of the increased annuities in question in such an event falls upon the province of Ontario; and that this burden has not been in any way affected or discharged."
"7. That interest is not recoverable on the arrears of such annuities accruing after the union, and not paid by the Dominion to the tribes of Indians entitled."
"8. That in respect to the matters hereinbefore dealt with the arbitrators have proceeded upon their view of disputed questions of law."
"9. That as respects the increased annuities which have been paid by the Dominion to the Indians since the union, any payments properly made are to be charged against the province of Ontario in the province of Ontario account as of the date of payment by the Dominion to the Indians, and so fall within and be affected by our previous ruling as to interest on that account."
"That Mr. Chancellor Boyd dissents from so much of the proposition contained in this paragraph as relates to the date at which such payment should be charged."
"II. With respect to the claim made by the Dominion of Canada against the province of Ontario for certain immigration expenditure:"
"1. That the Government of Canada recover against the province of Ontario the amount claimed for the year 1878, but that in reference to the claim made in respect of the years 1879 and 1880 the province of Ontario be discharged, and that this award is without prejudice to any question as to whether or not the province has paid more than was actually due in any year."
"III. With respect to the claim made by the province of Ontario against the Dominion of Canada, and by notice against the province of Quebec, for the recovery of a balance on the Upper Canada Municipalities' Fund:" "1. That the province do recover against the Dominion $15,732.76, parcel of the sum of $21,488.74 claimed, which said sum of $15,732.76 is to be credited to the province of Ontario in the province of Ontario account as of the date of the 1st of July, 1872; and, that as to the balance of the said claim, amounting to $5,755.98, the Dominion be discharged, and that the province of Quebec be discharged in respect of the whole claim."
"In witness whereof we, the said John Alexander Boyd, Sir Louis Napoleon Casault and George Wheelock Burbidge, have hereunto set our hands and seals this thirteenth day of February, A.D. 1895."
J. A. Boyd,
L. N. Casault,
Geo. W. Burbidge.
"Witness: L. A. Audette."
(The award was published and decision given on 14th February, 1895.)
"In the matter of the arbitration between the Dominion of Canada, the province of Ontario and the province of Quebec, pursuant to Statute of Canada, 54 & 55 V. c. 6, Statute of Ontario, 54 V. c. 2, and Statute of Quebec, 54 Y. c. 4."
"On motion of counsel for the province of Ontario, and on hearing what was alleged as well by counsel for the province of Ontario as by counsel for the Dominion of Canada and the province of Quebec, we, the undersigned arbitrators, do, with reference to a certain award and decision dated on the thirteenth and published by us on the fourteenth day of February, eighteen hundred and ninety-five, certify and declare that, in respect of the question of the liability of the province of Ontario for the increased annuities which have been paid by the Dominion to the Indians since the Union, as in such award is mentioned, the arbitrators proceeded upon their view of a disputed question of law, but that in respect of the question of interest on such increased annuities so paid, which question was dealt with in the ninth paragraph of the first part of such award by determining the time when such annuities should be charged against the province of Ontario in the province of Ontario account, the majority of the arbitrators did not proceed upon their view of a disputed question of law."
J. A. Boyd,
L. N. Casault,
Geo. W. Burbidge.
"Dated at Quebec,
this 26th day of March, 1895."
The Honourable Mr. Chancellor Boyd's Reasons for Award of February 13th, 1895, Delivered 14th February, 1895.
"I. This broad question as to the obligation of Ontario with respect to the Indians of the "Robinson treaties" may fairly and properly be dealt with as if the provisions of the Treaty and the sections of The British North America Act relating to lands were placed in juxtaposition.
"Then arises the inquiry: Does any interest in respect of these Indians attach to the lands belonging to Ontario under the 109th section of British North America Act?"
"The course of construction applicable both to constitutional Act and Indian treaty is not that a literal and strict meaning be given to the words, but that they shall be construed liberally and comprehensively so as to further the reasonable scope of the provisions. This benignant construction obtains with added force in the construction of a treaty wherein the rules of international rather than of municipal law are to be regarded." "Now in these transactions with the aborigines from the earliest colonial times in North America the Government has assumed the status of the Indian tribes to be that of distinct political communities. When the dealing has been by the Crown for the cession of territory over which some legal possessory right by the tribes in actual occupation has always been recognized, then the form of the transactions has been that of a treaty. Superadded to this, it is to be taken into account that the Indians relatively to the whites are in a state of dependency or pupilage, and that the nearest legal analogy as to the relationship between their tribes and the Government is that of guardian and ward."
"Hence arises the doctrines well established in American jurisprudence, and dating from the era of British colonization, that treaty stipulations are to be carried out with the utmost plentitude of good faith and with even generous interpretation in favour of these public wards of the nation."
"I cite the language of Mr. Justice McLean, in Worcester v. Slate of Georgia[1]: 'The language used in treaties with the Indians should never be construed to their prejudice. If words be made use of which are susceptible of a more extended meaning than their plain import, as connected with the tenor of the treaty, they should be considered as used only in the latter sense. * * * How the words of the treaty were understood by this unlettered people, rather than their critical meaning, should form the rule of construction.'
"This language is quoted and approved of by Mr. Justice Mathews, giving the opinion of the court in Choctaw Nation v. United States[2], and he continues thus: The recognized relation between the parties to this controversy is that between a superior and an inferior, whereby the latter is placed under the care and control of the former, and which, while it authorizes the adoption on the part of the United States of such policy as their own public interest may dictate, recognizes on the other hand such an interpretation of their acts and promises as justice and reason demand in all cases where power is exerted by the strong over those to whom they owe care and protection. The parties are not on an equal footing, and that inequality is to be made good by the superior justice which looks only to the substance of the right, without regard to technical rules framed under a system of municipal jurisdiction formulating the rights and obligations of private persons equally subject to the same laws.'"
"'The rules to be applied are those which govern public treaties, which even in the case of controversies between nations equally independent are not to be read as rigidly as documents between private persons governed by a system of technical law, but in the light of that larger sense which constitutes the spirit of the Law of Nations.'"
"On the face of the treaty of 1850 are found indicia of generous intentions contemplated and liberal dealings promised. Fixed annuities are given, as to which no question now arises. Then comes the provision for the augmentation of the annuities, 'should the territory ceded at any future period produce such an amount as will enable the government, without incurring loss, to increase the annuity;' That is to say, if the rents, issues and profits (whether from sales, leases, mining royalties, timber licenses or other sources of revenue derived from the surrendered land) shall yield a surplus after payment of all outlay in connection with the development and improvement of the territory, then that surplus shall go to augment the annuities from time to time. True, the mere words used do not say that the increased annuity is to be paid out of the proceeds of the land, but that is the plain and reasonable implication. In a dealing between guardian and ward, if the guardian took all the ward's property and undertook to maintain him, besides the general remedy equity would affix a trust to that effect upon the property so taken. Here the Indians would seem to have a right to an accounting even on the words of the treaty, so as to ascertain whether the event had arisen upon which the annuities were to be augmented. If upon such accounting a proper surplus appeared natural equity would impose a charge upon that surplus for the benefit of the Indians. That surplus would be in truth in the eye of equity the primary fund for the payment of the augmentations. The legislature (that includes the government) appears to treat even the fixed annuities as charges on the properties surrendered, and this though the payments are to be punctually made before any of the lands may have been realized. This no doubt is a proper fiscal arrangement (12 Vic. c. 200, s. 3). Even as to the fixed annuities, it would seem more obviously right where the annuities, as in the case of the augmentation, were only to be paid when a surplus arises out of the administration of the lands."
"In this latter case it would be not only a matter of finance and ordinary book-keeping, but also a conclusion of proper administration, that the revenue for the payment of the augmented annuities should be derived from the surplus outcome of the lands, and should be regarded as a charge upon that revenue, and so earmarked as applicable under the 'Robinson Treaties.'"
"This charge upon the proceeds of the lands which between individuals would have been looked for (especially where the weaker party was granting his property to the stronger) is here not expressed, because the undertaking of the Crown to make the payments afforded ample security, but nevertheless the real nature of the transaction involves the existence of an interest in the Indians in and upon the proceeds of the territory surrendered."
"The term, 'interest' used in the statute is of large enough import to include this latent charge, as put by Mr Justice Kay In re Thomas[3], an interest in the proceeds of land sold is 'an interest in land in contradistinction to an estate in land.'"
"The making of a treaty usually implies that the nation will by its municipal laws do all that is necessary to carry the provisions of the treaty into effect. (Per Anderson, B., in Reg. v. Serva[4]. If the parts of this treaty were thus extended, one proper term would be to charge the augmentations of the annuities upon the surplus revenues of the territory after the deduction of all proper outlays."
"By analogy to the equitable doctrine laid down in Waring v. Ward[5], it appears to me that there is an implied obligation to pay the increased annuities out of the proceeds of the lands which passes with the lands as a burden to be borne by Ontario."
"II. I think the treaty provides for an increase in the number of Indians who shall share in the augmented annuities as individuals, and that the increase is not to go to the Indians as a tribe but to the several members per capita at the time of payment. This is applying the liberal construction to the language used, so as to give the greatest possible benefit to the party least able to protect their own interests. The provision as to diminution of the annuity has reference only to the fixed sums, and does not impair the meaning given to the language used as to the augmentations. It is likely that the treaty was shaped with reference to the then prevalent idea that the tribes were dying out, but the intent of the treaty was to assist the Indians to change their state in bringing them a step nearer to civilization. If, however, the tribes increase in number the only limit of future payment is when they become entirely civilized so as to cease to be Indians."
"III. It is not desirable to define with minuteness who are Indians entitled to share, in advance of any particular case which arises for decision. It would appear from the despatch (a letter of Mr. Robinson, the Commissioner), which accompanies the treaty that half-breeds were then embraced in and numbered with the tribe in the approximate totals given. The recognition of these half-breeds as members of Indian tribes by the government appears to be manifested in contemporaneous and subsequent statutes."
"When the statute of Canada (13 & 14 Vic. ch. 74, passed 10th August, 1850), permitted none but Indians and those who may be intermarried with Indians to reside upon Indian lands (unless under special license from the government officer), and the act altogether seems to contemplate as Indians those of pure or mixed blood and those intermarried with and living among Indians (no distinction being made to sex). Then coming down to 1857, the statute of that year (20 Vic. ch. 26), gives a definition of Indians as meaning persons of Indian blood or intermarried with Indians, who shall be acknowledged as members of Indian bands, residing upon un-surrendered lands, or upon lands specially reserved for tribal use in common, and who shall themselves reside upon such lands; that is, one of other blood married to one of Indian blood, acknowledged as a member of the tribe and living on the tribal land with the tribe (whether man or woman) is accounted a member of that tribe. And the descendants of such marriage would be Indians as long as the tribal relation and residence lasted."
"This appears to be a more comprehensive category than would be the case if the matter rested on common law or on international law, for in such case, the maxim parlus sequitur patrem, governs cases as to Indians. (See judgment of Parker J., in Ex parte Reynolds[6]. "There is the observation also to be made that the government of Canada, before 1867, had always power to regulate the inhabitancy of Indian lands by excluding all whites therefrom, and their marriage and residency on the part of white people must have been with the sanction of the government."
"I would therefore favour generally the application of the rule so as to include among Indians those of other blood who are not only married to Indians, but were adopted and acknowledged by the tribe as members, and as such lived in tribal relation with the other members at their common place of residence. If all these conditions did not exist (as to the males anyway) I should say the person of other blood and his descendants was and were not included in those entitled under the treaties."
"IV. A similar difficulty arises as to the definition of what outlay should be taken into account before the right to increased annuities arises. All expenses connected with the survey and administration of the lands and the keeping of the accounts and all outlays going to develop and advantage the territory so as to induce settlement and sale would appear to be properly charged against the income from their lands, but it is better to deal with disputed items as they arise specifically than now to attempt to exhaust all details by way of anticipation." "V. In case it appears that surplus revenues existed sufficient to pay increased annuities and that there has been paid by the Dominion Government pursuant to the suggestion of Attorney-General Mowat made in 1873, these payments should be recouped to the Dominion as of this date and without interest."
"The nature of annuities is such as not to carry interest and the offer of the Attorney-General then to submit the matter in dispute as to liability to judicial tribunal should preclude the Dominion from getting interest during the period of delay from then till now." The Honourable Sir Louis Napoleon Casault:
"I would like to say one word about the interest, and about the responsibility of the provinces for the annuities subsequent to confederation. I have had occasion to consider the question before now, a good many years ago, and was firmly of the opinion that for all annuities, and even the capitalization subsequent to confederation, that it should be borne by the province of Ontario. I have had no occasion to change my mind—far from it—and I am glad to say that my two brother arbitrators are to-day of the same opinion. But there is a distinction to be drawn between the annuities payable after confederation, and those which became due before confederation. Of course, those which became due before confederation were due by the province of Canada to the Indians, and formed the debt of the province of Canada, and for those, if any there be, they should be paid both by Quebec and Ontario, in the proportion held by the first arbitration."
"As to interest, we have come to the conclusion, which was not adopted by the learned Chancellor, that the interest should be paid upon a balance of about $900,000 and $500,000, say $1,500,000 by Ontario, and by Quebec upon $625,000, if the balance against each province amounted to these amounts, and if by the final settlement of the accounts the balance was made less the interest should be for the less amount. I think this is nothing but a sequence of what we have decided. Of course, it should go with interest if the final settlement of the accounts diminishes the amount for which we have said that the Dominion was entitled to interest as against the province of Ontario, and if not, of course there would be no interest."
THE HONOURABLE MR. JUSTICE BURBIDGE:
"The case was presented to us by counsel with such completeness and lucidity of argument, and the learned Chancellor has, in the opinion that he has just delivered, and to which we have all listened with so great interest, dealt so fully with the principal issues involved, that I shall content myself with stating, as briefly and with as little discussion as possible, the conclusions to which I have come."
"I am of opinion, and as to that I do not know that there is any controversy between the parties, that if in any year since the two treaties in question were entered into the territory thereby ceded produced an amount which would have enabled the government of the province of Canada, or its successor, without incurring loss, to pay the increased annuities thereby secured to the Indian tribes mentioned therein, then such tribes were entitled to such increase, not exceeding four dollars for each individual. So much they were entitled to as a matter of law and right. Any increase beyond that would have been a matter of grace."
"I am further of opinion that the total amount of annuity to be paid under each treaty is in such a case to be ascertained by reference to the number of Indians from time to time belonging to the tribes entitled to the benefit of the treaty; that is, that in case of an increase in the number of Indians beyond the number of 1,240 named in one treaty, and 1,422 in the other, the annuity, if the funds permitted, was to be equal to a sum that would provide four dollars for each Indian of the tribes entitled. The only difficulty I have had on this point arises from the provision for the diminution of the annuity in case the number of those entitled fell below two-thirds of the numbers mentioned. In that case they were not to have 'the full benefit' of the treaty, and the annuity should be diminished in proportion to the actual members. If this provision, however, be taken to have reference only to the fixed annuities, which at the moment were for all parties the more important matter, the difficulty disappears. That clause probably was intended to operate in reduction in the case provided for of the perpetual and fixed annuities that were payable quite apart from any consideration of the amount of the revenues to be derived from the ceded territory, leaving the other provision as to increase to depend upon the excess of such revenues over the charges referable to the opening up and administration of such territory. That, on the whole, it seems to me, must have been the intention of the parties."
"Then as to 'the individuals' who in case the increase can be made without loss are to be reckoned in ascertaining the amount of the annuity, it is clear of course that they are to be Indians belonging to the tribes or bands entitled, and no one should be counted who was not by law or well-established custom a bonâ fide Indian of the tribe or band."
"I agree with what was said by Mr. Robinson of the danger of attempting at present an abstract definition of the word "Indian." With reference to the period before the union I do not see that there can be any difficulty. Whatever government is now liable to pay or make good any amounts that were payable but not paid before the union, is so liable as the successor or successors of the old province of Canada, the government of which appears to have kept a record or list of the names of the Indians entitled to share in the fixed annuities. Generally speaking the 'individuals' whose names appear on such lists would be those to be taken into account in computing any increased annuity that should have been paid. The onus of showing that the names of any individuals entitled to be reckoned were improperly omitted from such lists should now be on the Indians, or those who act for them, and in like manner no names should, I think, be struck off, except for good reason shown by those whose interest it is to keep the numbers down."
"With reference to the period after confederation, neither Ontario nor Quebec would be in any way affected or precluded by the action of the Parliament or Government of Canada, or of any of its officers, either in prescribing a definition of who are Indians or in adding to the lists the name of any 'individual' as an Indian of a tribe or band entitled to the benefit of either treaty. The burden of showing that the names of any Indians so added since the union to such lists were rightly added, would be, it seems to me, on the Government of Canada."
"I should be equally unwilling to attempt a definition of the expenses and charges for the opening up, settlement and administration of the ceded territory that should be taken into account in determining whether or not the annuities could be increased 'without incurring loss.' In a general way they must, I think, be fairly referable to the administration of the particular territory and not of the class of expenditures that are incurred by governments for the general advantage of the whole country. During the argument certain expenditures by the Government of Canada since the union were mentioned; but on the whole they did not appear to me to be such as should be taken account of. If, however, there should happen to be any expenditure directly made or incurred by the Government of the Dominion for the purpose of the opening up of, and enhancing the value of, the particular territory in question, I am not at present prepared to say that it should not be taken into account."
"Then as to the question raised by Mr. Robinson as to whether or not any excess of revenue in any year might not be used to give the increased annuity in a former year in which an increased annuity could not have been paid without loss, I see no reason to change the view I expressed at the hearing, that that could not be done. If in any year the condition prescribed by the treaties did not happen the Indians have in respect of that year no claim. Of course any such excess or balance of revenue over expenditure in hand at the commencement of any given year should be taken into the accounts of that year. But if in any year the increased annuity could not be paid without loss after taking any such existing excess or balance into account, then there was as to that year no liability to pay any increased annuity."
"I think there can be no doubt that any liability to pay the increased annuity in any year before the union was a debt or liability which devolved upon Canada since the 111th section of the British North America Act, 1867."
"I am also of opinion that this is one of the matters to be taken into account in ascertaining the excess of debt for which Ontario and Quebec are conjointly liable to Canada under the 112th section of the Act."
"I do not think that Ontario and Quebec have, in respect of any such liability, been discharged by reason of the capitalization of the fixed annuities, or because of anything in the Act of 1873 (36 Vic. ch. 30). The matter was never considered or taken any account of in such capitalization or in any of the proceedings leading up to the award of Sept. 3rd, 1870, or in the award itself."
"With respect to the Act of 1873, its effect, so far as it is necessary now to consider it, was to substitute the sum of $73,006,088.84 for the sum of $62,500,000.00 in the 112th section of the British North America Act, 1807, the result being that Ontario and Quebec became and remained conjointly liable to Canada for any excess of debt over the former instead of the latter sum. That is the clear construction of the Act itself, and it is one that has been acted upon without question by all parties since the Act of 1873 was passed. The contention for a different construction is now raised for the first time. It is now said that the Act of 1873 was conclusive of the amount of the debt with which the old province of Canada entered the union. If so, the province of Canada account was closed in 1873, and the negotiations between the parties that have occurred since the agreement of 1888 (Exhibit Z, Report of Conference, 1888, p. 4), the settlement of particular items of that account coming in or ascertaining between the years 1873 and 1888 (id. pp. 19 to 22), and our awards in respect to that account and interest thereon all go for nothing. The question is not, it seems to me, open to fair debate."
"With reference to the question of interest on any increased annuities that may be now ascertained to have been payable prior to the union to the Indians under the treaties in question, it is obviously necessary to distinguish between the rights of the Indians to interest, and the question of interest as between the Dominion and the provinces of Ontario and Quebec as the successors in liability to the old province of Canada. The latter question has been concluded by the agreement of 1888, and our award following that agreement. The question as to whether or not interest should be computed on any arrears of such annuities is another matter depending upon the right in law or equity of the Indians to interest as against the Crown, and it seems to me that they have no case either at law or in equity. I regret that I cannot see my way to a different conclusion. But I have no doubt that the debts and liabilities for which Canada became liable under the 111th section of the British North America Act are legal debts and liabilities, and that the excess of debt for which, under the 112th section, Ontario and Quebec became conjointly liable to the Dominion, cannot, without the conjoint consent of Ontario and Quebec, be increased by any debt or liability not enforceable in law or equity."
"If there is to be any consideration of any claim of the Indians to interest on any arrears of annuities payable before the union in recognition of any moral obligation or as a matter of good conscience, it is for Ontario and Quebec to consider the matter and admit or deny the claim as they see fit. The Dominion can collect from them only what they legally owe, and cannot by discharging moral obligations make Ontario and Quebec liable; and there is, if I may express an opinion on that point, obviously no obligation, legal or moral, on the Dominion to do more than collect for the Indians from Ontario and Quebec whatever amount of arrears the province of Canada owed to them, and to pay it over to the tribes entitled."
"Unless Ontario and Quebec will consent that in computing the amount of arrears due to the Indians at the union, such arrears shall be computed with interest, they must, it seems to me, be made up without interest."
"With reference to the period subsequent to the union, the case presented by the Dominion for the tribes of Indians interested in the treaties in question is, that the ceded territory became the property of Ontario under the 109th section of the British North America Act, 1867, subject to a trust to pay the increased annuities on the happening after the union of the event on which such payment depended, and to the interest of the Indians therein. The other question as to whether or not Ontario and Quebec are conjointly liable under the 112th section of the Act to the Dominion for such increased annuities with or without a right on the part of Quebec to be indemnified by Ontario against the same, is not now raised. That question is reserved to come up in some future proceeding or not, as the Dominion may think proper."
"Now, looking to the particular matter, my mind lends a ready assent to Mr. Robinson's argument that it is equitable that this burden should fall upon Ontario. Ontario has the advantages resulting from the ownership of the lands, and it should bear the burden. I agree to that; considered as a matter by itself it is highly inequitable that any part of the burden should fall upon Quebec, and even in a greater degree inequitable that Nova Scotia or New Brunswick or any of the provinces that came into the union since 1867 should be called upon as a part of the Dominion to contribute anything towards making good to the tribes entitled the increased annuities payable to them under the treaties mentioned; and were it not for the consideration to which I am about to refer I should for myself have little or no hesitation in joining in making an award upon the 'equitable principles' mentioned in the sixth section of the Acts under which we are sitting. But the union of the provinces was a large matter involving many issues and considerations of great moment, and the compact to which expression was given in the Act by which the union was consummated is one which should, I think, be guarded and maintained with great watchfulness and care. What one might think to be fair and equitable with respect to a particular matter dealt with in the Act, abstracted from other provisions therein, might in conjunction with such provisions be in fact and reality unfair and inequitable. So it seems to me that the only safe way is to adhere strictly to the compact or treaty that was made by the province that entered into the union; and that the highest fairness and equity will be found in giving to each the advantages, and imposing upon each the burdens, it has bargained for. The case is one in which we ought, I think, to proceed upon our view of 'a disputed question of law,' and I am better satisfied to follow that course as it will save to the party against whom any award is made a right of appeal to the Supreme Court of Canada, and thence to the Judicial Committee of the Privy Council [54 & 55 Vict. (D.), c. 6, s. 6]."
"Now with reference to the question of law in dispute, it seems to me clear that in a narrow and strict sense the Indians for whom this claim is made by the Dominion had at the union no interest in the lands constituting the ceded territory, other than the right or privilege of hunting thereon or fishing in the waters thereof so long as such lands were ungranted. These Indians were no doubt interested in such lands in the sense that it would be to them an advantage to have them managed with a prudence and forethought that would at the earliest possible time and for the longest time possible give them the increased annuities for which the treaties made provision. But the very object of the surrender was to give the Crown a free hand in the settlement and administration of the land and to divest the Indians of any title thereto or interest therein. And so too, looking to the parties to the treaties in question, the Crown on the one side and the several tribes of Indians on the other, it is possible that the Crown did not, after the surrender, hold the ceded territory on any trust that would be enforceable in law. But in a broader sense, and I agree fully with the learned Chancellor in thinking that the treaties in question and the British North America Act should be construed in a large and liberal way, it seems to me that the Indians, in entering into such treaties, reposed a confidence in the Crown that it would manage the ceded lands fairly for the advantage of all concerned, and so as to raise there out, if that were fairly possible, the moneys to pay the increased annuities, and that there was a corresponding duty resting on the. Crown to do so. In that sense the lands were at the union, it seems to me, subject to a trust or interest existing in respect of the same. It is objected that it was not the lands constituting the ceded territory, but the proceeds of the lands, that were impressed, if at all, with any such trust, or in which the Indians had any such interest, and it is 'lands' and not 'proceeds of lands,' that are mentioned in the 109th section of the British North America Act, 1867. But that objection does not, it seems to me, present any great difficulty in view of the facts of the case. These lands were, before the surrender, and have since been vested in the Crown. There was no change of title at the union. The Crown continued to hold them. Before the union the beneficial interest in such lands and the right to take and appropriate the revenues arising therefrom was vested in the province of Canada, and by the 109th section of the British North America Act, 1867, that right passed to the province of Ontario. The lands themselves did not pass in the sense that the title thereto was transferred. What passed was the right to administer and take the proceeds, the revenues arising from such lands. This is clear, I think, from two passages of the judgment of the Judicial Committee, delivered by Lord Watson in the St. Catharines Milling and Lumber Company v. The Queen[7], cited by Mr. Justice King in Farwell v. The Queen[8], and from what the same learned Lord said in delivering their Lordships' judgment in the 'Precious Metals' Case,' the Attorney-General of British Columbia v. The Attorney-General of Canada[9]."
"In the former case, referring to the effect of the Imperial statute, 3 & 4 Vic. c. 35, Lord Watson said:—.
"'There was no transfer to the province of any legal estate in the Crown lands which continued to be vested in the Sovereign, but all moneys realized by sales, or in any other matter, became the property of the province. In other words, all beneficial interest in such lands within the provincial boundaries belonging to the Queen, and either producing or capable of producing revenue, passed to the province, the title still remaining in the Crown.'"
"And then with reference to the distribution of property under the British North America Act, 1867:
"'It must always be kept in view that, whenever public land with its incidents is described as 'the property of' or as 'belonging to' the Dominion or province, these expressions merely import that the right to its beneficial use, or to its proceeds, has been appropriated to the Dominion or the province, (as the case may be), and is subject to the control of its legislature, the land itself being vested in the Crown.'"
"The following are extracts from the judgment in 'The Precious Metals' Case.':—
"'The title to the public lands of British Columbia has all along been, and still is, vested in the Crown; but the right to administer and to dispose of these lands to settlers, together with all royal and territorial revenues arising therefrom, has been transferred to the province before its admission into the federal union. Leaving the precious metals out of view for the present, it seems clear that the only ‘conveyance' contemplated was a transfer to the Dominion of the provincial right to manage and settle the lands, and to appropriate their revenues. It was neither intended that the lands should be taken out of the province, nor that the Dominion Government should occupy the position of a freeholder within the province.'"
"'In British Columbia the right to public lands, and the right to precious metals in all provincial lands, whether public or private, still rest upon titles as distinct as if the Crown had never parted with its beneficial interests; and the Crown assigned these beneficial interests to the Government of the province, in order that they might be appropriated to the same state purposes to which they would have been applicable if they had remained in the possession of the Crown. Although the provincial Government has now the disposal of all revenues derived from prerogative rights connected with land or minerals in British Columbia, these revenues differ in legal quality from the ordinary territorial revenues of the Crown. It therefore appears to their Lordships that a conveyance by the province for 'public lands,' which is, in substance, an assignment of its rights to appropriate the territoral revenues arising from such lands, does not imply any transfer of its interest in revenues arising from the prerogative rights of the Crown.'"
"That view of what lands mean when vested in the Crown in the right of or for the use or benefit of the Dominion or of a province relieves us, I think, of any difficulty that might otherwise arise in respect to any distinction between a trust or interest in such lands and in the proceeds of or revenues arising out of such lands."
"I think the ultimate burden of making provision for the payment of the increased annuities in question falls upon the province of Ontario, and that that burden has not, as against the Dominion or these Indians, been in any way affected or discharged. I express no opinion as to the effect of the award of 1870 on the respective rights of Ontario and Quebec. That question would arise in a case presented by the Dominion against the two provinces under the 112th section of the British North America Act, but does not arise here."
"With reference to interest on arrears of annuities accruing due after the union and not paid to those entitled, it seems to me that they stood in the same position as those that accrued before the union and that interest should not be computed without consent of Ontario. But as to the increased annuities paid by the Dominion to the Indians in 1874 and since, the Dominion should, I think, have interest on any amounts so properly disbursed, if our award as to interest on the province accounts permits thereof. The payments were made after notice and after certain negotiations between the Dominion and Ontario, in which, without determining on whom the burden should ultimately fall, it was admitted the Indians were entitled. The question, then, is not one of interest on unpaid annuities, but of interest on moneys paid by the Dominion in respect of a legal liability, for which it is entitled to indemnity against Ontario"
"I think any such moneys so properly paid should be charged against the province in the province of Ontario account as of the date of payment by the Dominion to the Indians, and so fall within and be affected by any previous ruling as to interest on that account."
The province of Ontario appealed from said award to the Supreme Court of Canada.
Æmilius Irving Q.C, S. H. Blake Q.C. and J. M. Clark appeared for the appellant, the Province of Ontario.
Christopher Robinson Q.C. and W. D. Hogg Q.C., for the respondent, the Dominion of Canada.
D. Girouard Q.C. and Hon. J.S. Hall Q.C, for the respondent, the Province of Quebec.
Irving Q.C. With your Lordships' permission, my learned friends Mr. Blake and Mr. Clark appear on behalf of Ontario; I am also in the case but I shall not address the court. My learned friend Mr. Blake will lead.
Blake Q.C. Ontario claims that there was no trust in respect to these lands; that no trust could have been declared in regard to them; that any trust would have absolutely defeated what the parties were endeavouring to arrange, which was that the lands were to be placed in the possession of Canada, so that they might deal absolutely with them. If there was to be any trust in favour of the lands it would have absolutely defeated what the province of Canada was desirous of carrying out. For what the province of Canada wanted to do was at once either absolutely to give away or absolutely to sell, or absolutely to deal with, these lands. If there had been any trust, or if there had been any interest retained in favour of the Indians, then the province would have been utterly unable to do what it desired to carry out. The arrangement was one to do away with any right, to do away with any interest, to do away with anything that in any possible way might check the freest dealing with this property. The Indians, of course, are perfectly satisfied, because, instead of the illusory charge which they had of fishing and shooting, they get absolutely as much of the land as they felt they could possibly deal with. They retain—and it is specified in the treaty as all that they do retain—the right to fish and shoot on all the other lands until the Government chooses to sell them; but the moment it gives them away, or sells them, or leases them, that ends it. They take a certain sum of money down, and they take the promise of the Government, which embraces the honour of the Crown, which embraces all, it may be, that might come from the lands, which embraces all the revenues of the Government. They take that promise and set absolutely free all these lands; and if these lands are not set absolutely free from any trust and from any interest, then the whole object of the treaty is utterly and entirely defeated.
Trusts or charges, or anything of that kind, would be out of the question because it binds or touches the land; the very object of what was being entered into is utterly defeated, because the person that takes the land must take it with the trust or with the charge, and the land is not land absolutely free to be dealt with, as was the intention of those parties. I think that that should be emphasized, because while both the learned Chancellor and Mr. Justice Burbidge say that, taking this as an ordinary instrument, and construing it as an ordinary instrument, construing it so as to 'further the reasonable scope of the provisions, they are able to stretch it in such a way as to create upon the land that which did not exist. Now, my Lords, you will find that the learned Chancellor says:
"The course of construction applicable both to the constitutional Act and Indian treaty is not that a literal and strict meaning is to be given the words, but that they shall be construed liberally and comprehensively, so as to further the reasonable scope of the provisions." I have no objections whatever to the reasonable scope of the provisions being followed out; but is not the true scope here that the lands are not to be charged? Is not the true scope of the provision that the Government is to take the lands freed from any interest or charge?
It is only by the one solitary means that Ontario can be made responsible and that is by holding that they have taken the lands subject to a trust and holding the lands under the trust must discharge it; and in discharging it, must pay these annuities. Ontario alone did not enter into this bargain; Ontario was not known then. There was no contract with Ontario; it was a contract with the provinces composed of Upper and Lower Canada, and the only way that Ontario can be made responsible is, not by carrying out the reasonable scope of the instrument, but by freely and entirely negativing what is its scope, altering it entirely, altering it entirely to the detriment of Ontario, altering it entirely not to the betterment of the Indians. And this has not been stretched in order to help the Indian, because the Indian knows perfectly well that he has got the whole of the Dominion behind his back in this payment. But what I do submit is that here the true scope is that the lands are not chargeable. The true scope is that there is to be a personal payment by the Crown to the Indians; and if there is to be any such enlargement must not the enlargement be according to the scope of the instrument, and not to defeat the instrument? If you turn round now and say there is to be a trust—and it is admitted that that is an enlargement—why, my Lords, it is an enlargement that defeats the instrument and does not carry it out.
Then again, it is said that there is an implied obligation to pay them out of the revenue from the lands. I submit not; no implied obligation to pay them out of this at all; a distinct bargain made for certain benefits on the one side and certain benefits on the other; that there will be, in case I make well out of my bargain, a certain additional sum or an augmentation in your favour.
So, I say there was no charge, no right, no interest, and one of my strong arguments is the language that has been used by these two learned judges, showing that the language, taken as it usually is taken, does not warrant it, and showing that the very object that was had in view would be utterly defeated if the language was so broad. But then they say "because these are Indians, you are to deal liberally with them," forgetting, my Lords, that it does not give the Indians one cent more or one cent less. The Indians are not dissatisfied with their paymaster; and, forgetting that, they are making this change in this bargain—for virtually it is a change—not in favour of those that they say are entitled to consideration, but in order to charge the one province as against the other.
I went through the cases that have been referred to, but I did not find that there was anything whatever in them which negatived the position taken by the province of Ontario here.
The case well known to his Lordship, the Chief Justice of the court, of the Canada Central Railway v. The Queen, in which his Lordship gave judgment in the first instance[10], was referred to. Well, my Lords, I gladly take the conclusion of his Lordship, Chancellor Sprague, there, at page 314, where it was urged there should be, even in an Act of Parliament, an extension or the like. He says: "I am in doubt whether the consequences were appreciated by the legislature, but our duty is to interpret it, and that is our only function." And then your Lordships will find at pages 326 and 328 of that judgment, a citation of cases in regard to the construction of Acts of Parliament. In that case of the Central Railway Company there was the express statement—and your Lordships will find that at page 275—that the company was to be entitled to a grant of land. I am simply referring to the cases cited, and referring to the fact that there is nothing in those cases which would warrant what the learned arbitrators have done. By section 18 of the Act there certain lands were set apart, and at page 289 it is said that it is taken for granted that, as between individuals, the right to that specific land existed. The only question was the making a selection out of four million acres of lands that were granted; and the court came to the conclusion that if there was a sale of 5 acres out of 100 that the party might make a selection of it. But there was the most absolute trust as declared by the Act of Parliament in favour of the Railway Company that was presenting the petition. And in Booth v. McIntyre[11], another case cited, it was held that the company had the power untrammelled by any restrictions to enter upon the lands of the Crown, and that that was not taken away but reserved by section 109 of the British North America Act. But there the right existed; it was plain and specific; no question about it.
Then there was a case in Maclean's Reports, as to the treaties with Indians and the tribes and others, and I do not find anything there. On the contrary it was held that the distinction was not authorized by the constitution; that is, to deal in treaties with Indians in different ways from other treaties. They are treaties within the meaning of the constitution, and as such should be laws of the land. Mr. Hallock, whose book was also referred to, says that they are to receive a fair and liberal interpretation, according to the intention of the contracting parties. That is all that is to be kept in view, according to the intention of the contracting parties—which I say would be utterly defeated by the interpretation put here—and be construed in good faith. Their intention is to be governed by the same rules which we apply to the determination of contracts. That is the third edition of Hallock's International Law, 296. Whitton says they are to be construed in the same way; and Story also, vol. 2, page 44.
I submit, therefore, my Lords, that the true conclusion in respect to this matter was that Ontario is not individually liable for the payment of this amount; that nothing has transpired to place upon Ontario any additional responsibility; and that this is a debt either of the old province of Canada in the augmentation of it, as well as in the original amount; and that it must either be discharged by that province, or else discharged by the Dominion of Canada.
Clark follows for the appellant. In the present appeal before your Lordships, and in the argument before the learned arbitrators, the whole question was as to whether there was a sole liability of the province of Ontario for payment of these annuities subsequent to confederation; the other question was not raised. Ontario asked before the arbitrators that the whole matter should be settled at once, but the Dominion reserved their right to make a claim afterwards against the province of Canada under section 112, if the present claim failed; but your Lordships will see that that matter is not adjudicated upon at all in the award, and was purposely left out by the arbitrators, and that matter, namely, the liability of the old province of Canada, as to whether the Dominion was liable under section 111, and had any right over against the province of Canada under section 112—that is against Ontario and Quebec jointly—is entirely left in abeyance, and is not the subject of the present appeal.
Then the whole question now before your Lordships is as to the construction of these treaties and of section 109, of course taken in connection with section 111, and so on, so far as they throw light on section 109.
First, I would like to call your Lordships' attention to the suggestion made in the factum of the Dominion and in the judgment of the learned Chancellor, namely, that all the meaning of these sections could be obtained by construing the British North America Act, or at least the sections in question, as if the treaties, which are the subject of the present bill, had been incorporated in them by way of preamble.
If we consider it in that way, we hare first the treaties in question mentioned in the case, and of which my learned friend read sufficient to illustrate the present argument. Then we have the treaties declaring that the Indians surrender, and so on, using the largest possible words of grant, all their right, title and interest—using the very words of the British North America Act—in the lands in question, and give up all their right, title and interest in the land.
And what I submit is that the only interest that the Indians expressed on the face of the treaty—I shall deal afterwards, if necessary, with the question of the implication—refers to the reservations mentioned in the treaty, which are not in question, and to the rights to shoot, and so on, given to the Indians under the words of the treaty.
I submit that the previous arbitrators, in 1870, having dealt with the matter there should not now be an award which is in direct conflict with the previous award, especially when your Lordships bear in mind that there was an appeal from the previous award to the Privy Council, and that the Privy Council confirmed the award so far as the objections then taken. In the special case which is referred to in paragraph 6 of the judgment of the Privy Council, (your Lordships will find that special case printed in the Ontario Sessional Papers of 1878, number 42) your Lordships will see that this identical section, 109, is made part of the case. So that if there was anything in the award of 1870 which was in conflict with section 109, then that was the objection appearing on the special case before the Privy Council, and is, I submit, concluded in favour of Ontario by the judgment of the Privy Council, that so far as any objection was made to the award in the special case the award is valid.
Before the learned arbitrators, and in the factum of the Dominion, they argue in favour of the principle that Ontario getting the benefit of the lands should bear the burden of these annuities, and in support of that contention they rely, apparently, on the direction of the Privy Council in St. Catharines Milling Company v. The Queen[12]; but all the decisions of all the courts are collected in the 4th volume of Cartwright, the cases under the British North America Act at page 107 and subsequent pages, commencing with the decision in the Privy Council. Now, your Lordships will see from the whole of the reports, and from the way in which the matter was discussed in the Supreme Court[13], that originally it was a matter entirely between the Attorney-General for Ontario and the St. Catharines Milling and Lumber Company. That was decided in that way by the Chancellor of Ontario, the Court of Appeal for Ontario, and this court. And it was only on the application for leave to appeal to the Privy Council that the question of the right of the Dominion came in at all; and the Dominion was allowed, on a special order made in that case, to intervene, and it is pointed out in the citation in the factum that the whole of the question in regard to the effect of that treaty then in question in 1873, was to be decided on the appeal to the Privy Council; and at page 60 of that case, in the judgment, Lord Watson says that, seeing that Ontario gets the benefit of the land there in question, that Ontario must recoup the Dominion the money payments which are there referred to; but what I point out to your Lordships is that the circumstances in that case were entirely distinct from the present case, and that that case can have no application to the decision here. Your Lordships will observe that the treaty there in question, being the North-west Angle Treaty, no. 3, was made in 1873, subsequent to confederation, so that the position was that at the time that treaty was made in 1873, Ontario took those lands, as was held in all the courts, subject to the burden of the Indian interest, whatever that interest may be.
There is a case in 31 Common Pleas which construes the word interest, and I submit the considerations there are entirely in favour of Ontario, and that only the class of matters which are referred to are intended to be covered by the words "trust and interest" in section 109.
Robinson Q.C. for the Dominion of Canada. There are two or three considerations, which may be put very shortly, which it seems to us is almost conclusive in favour of the constructions which the arbitrators have adopted. In the first place, as I understand, those principles which apply, and which my learned friends seek to apply, with reference to the legal authorities, as to the existence or non-existence of a vendor's lien, and different cases of that kind, and as to the existence or non-existence of a trust, are not relevant to the issue; there is no vendor's lien here; the Dominion is not seeking to retain a vendor's lien; it is a transaction sui generis; you cannot find any transaction like it. The reason of it is this: this land undoubtedly, in the hands of the old province of Canada and before confederation, was certainly land in which the Indians had an interest. It was land subject to a trust for their benefit.
What would have been the position of things before confederation? Canada would have had to pay this debt out of the proceeds of this land. Well, now, does not Ontario, getting this land, hold it from Canada just as Canada held it? What is the difference? The Crown held it before for the benefit of the old province of Canada. There has been no sale and no transfer of title, as we all know. The Crown hold it now for the benefit of the province of Ontario. Why should the Crown hold it for the benefit of the province of Ontario in any different way or different position or free from any claims which attached to it while they held it for the province of Canada? I hold land for A. and hold it for A., with this interest which B. has in it, namely, to get the proceeds from it over and above a certain sum; I make an arrangement instead of holding it for A. I shall hold it for C.; why should I not hold it for C. under the same conditions as I hold it for A? Why should the interest in the land be changed by reason of a difference to the cestui qui trust? Because that is what it means. We submit the whole arrangement shows that plainly.
Now, then, let us consider for a moment clause 13 of the aw