City of Vancouver v. Attorney-General of Canada

City of Vancouver v. Attorney-General of Canada
Collection
Supreme Court Judgments
Date
1943-12-15
Report
[1944] SCR 23
Judges
Duff, Lyman Poore; Rinfret, Thibaudeau; Davis, Henry Hague; Kerwin, Patrick; Hudson, Albert Blellock; Taschereau, Robert; Rand, Ivan Cleveland
On appeal from
British Columbia
Subjects
State
Taxation
Decision Content
Supreme Court of Canada
City of Vancouver v. Attorney-General of Canada, [1944] S.C.R. 23
Date: 1943-12-15
City Of Vancouver (Defendant) Appellant;
and
The Attorney-General Of Canada, The Attorney-General For British Columbia And The Canadian Northern Pacific Railway Company (Plaintiffs) Respondents.
1943: October 7, 8, 12, 13; 1943: December 15.
Present: Duff C.J. and Rinfret, Davis, Kerwin, Hudson, Taschereau and Rand JJ.
ON APPEAL FROM THE COURT OF APPEAL FOR BRITISH COLUMBIA
Taxation (municipal)—Crown's interests—Tax levied against owner of land leased to Crown—Buildings erected on such land by the Crown—Valuation of land including value of buildings as improvements—Whether property "vested in or held by" the Crown has been taxed—Whether tax has been levied on Crown's interests—Vancouver Incorporation Act, B.C. Statute, 1921 (2nd session), c. 55, ss. 2 (9) (10) (11), 37, 39, 40, 45, 46, 48, 49, 55, 56, 57, 58, 59, 60, 63, 67, 69, 73, 323—Land Registry Act, R.S.B.C., 1936, c. 140, s. 143—B.N.A. Act. s. 125.
The respondent, The Canadian Northern Pacific Railway Company, owner of a large tract of land within the city of Vancouver, leased a vacant portion of it, on the 1st of January, 1923, to His Majesty represented by the Minister of Agriculture for the Dominion and the Minister of Agriculture of British Columbia jointly; and subsequently, as required by the lease, His Majesty, represented as above, erected thereon a building known as the "Vancouver Fumigation Station Building". On the 1st of May, 1940, His Majesty, represented by the Minister of Munitions and Supply of the Dominion, leased from the respondent company another vacant portion of the same land, and subsequently a building known as the "Boeing Aircraft Building" was erected thereon for and at the expense of the Crown pursuant to a contract made between the Crown and the Boeing Aircraft of Canada Limited. An action was brought by the Dominion and Province for a declaration that these buildings were not subject to taxation and by the railway company for a declaration that it was not liable to be assessed or taxed in respect of these buildings and was entitled to recover back taxes already paid by it thereon. The procedure laid down by the Vancouver Incorporation Act, 1921, (B.C.—12 Geo. V, c. 55) for the taxation of land is outlined in the judgments now reported. Briefly, it is enacted that the City Treasurer, or the Collector of Taxes, "shall make out a tax roll" in which there are set down, inter alia, "the name *** of the assessed owner", "the value at which the land and improvements *** are assessed" and "the total amount of taxes imposed for the current year" (s. 59); it is also enacted that "all rates, taxes or assessments *** shall be due and payable *** by the owner of the property upon which they are imposed *** " (sec. 63); and it is further enacted (s. 46) that "all land, real property, improvements thereon *** shall be liable for taxation, subject to the following exemptions: (1) All property vested in or held by His Majesty or for the public use of the Province *** and either unoccupied or occupied by some person in an official capacity". On behalf of the respondents, it was contended that the buildings were the property of the Dominion and Provincial Governments and as such were non-assessable and non-taxable: their contention being that these buildings had been assessed as improvements and that the taxes had been unlawfully levied and wrongfully collected in respect of them. The trial judge maintained the respondents' action, except that the railway company's claim for repayment was restricted to one year's taxes which had been paid under protest, this decision being based on the Crown's ownership of the two buildings and also on the ground that the buildings were "held by" His Majesty within the meaning of section 46 of the Vancouver charter. The Court of Appeal, Sloan J.A. dissenting, affirmed the judgment of the trial judge.
Held, reversing the judgment appealed from (58 B.C.R. 371), Hudson J. dissenting, that the respondents were not entitled to the reliefclaimed. The provincial statute does not operate by way of attempting to impose any liability on the Crown in respect of any interest under the leases, and there has been no attempt by the city appellant to impose such liability on the Crown. The respondent railway company, as registered owner of the land, is liable to taxation in respect of its value as assessed in conformity with the statute. The provisions of the statute do not contemplate the assessment, as a separate subject, of improvements in an assessed parcel of land. There has been a separate valuation of the buildings as improvements; but the value of the buildings has been taken into account only for the purpose of valuing the parcel of land and calculating the tax to be paid in respect of it, and also in order to permit of the operation of other sections of the statute. The Crown's exemption, provided by section 125 B.N.A. Act or by section 46 (1) of the Vancouver charter, remained unimpaired.
Per The Chief Justice and Rinfret J.—The "assessed owner" is liable for taxation, and he is liable in virtue of his ownership: the "assessed owner", in light of the provisions of the statute, must be construed as meaning the registered owner in fee. The holder of a lease, if registered, and the owner of a structure erected on a land of which he is not the owner, cannot be registered otherwise than as owner of a charge. The property in this case has been valued in precisely the same way as it would have been valued if the lessees had been subjects, and not the Crown.
Per Davis J.—The parcel of land is wholly owned by the respondent railway company and the only levy of rates has been made against it on an assessment of the land and buildings thereon made under the valid provisions of statute. No attempt has been made by the appellant city to assess or levy rates against the rights or interest of the Crown or to tax the Crown in respect of the buildings.
Per Kerwin J.—The proper construction of the provisions of the statute is that what is rateable or taxable is "land" as defined in the interpretation section. Such taxation is founded upon the appearance in the assessment roll of such rateable land, together with the name of the registered owner. The rateable land includes buildings erected on it, but the land and improvements are assessable and taxable as a unit. The levy under the Act is not only a tax on "land", but is also a tax against the owner. As to the former, the statute must be read as not applying to the Crown and the operation of the statute imposing the tax is limited to the respondent railway's interest. As to the latter, there is no constitutional objection to taxing the respondent company on the basis of the total value of the land and improvements thereon, even though the improvements are the property of, or are held by, the Crown and are themselves not liable to taxation.
Per Taschereau and Rand JJ.—The general scheme of taxation provided by the statute is one of imposing, upon the interest of the private owner of the freehold estate or the private person in possession of Crown land, a tax based on the value of the totality of interest in the land, including improvements, thus including the value of the leasehold interest of property rented to private individuals or to the Crown. Assuming that the exemption in section 46 includes a leasehold interest of the Crown, that does not affect the fact that "rateable parcel of land" includes land so leased, or that the valuation of that parcel is without exclusion of the separate or exempt leasehold interest: the latter, possessed by the Crown, is neither taxed itself nor made the subject-matter of a tax lien. Its value is included in that of the owner's interest as if the owner were in occupation, but that circumstance is unobjectionable and not in conflict with section 125 B.N.A. Act. Moreover, the inclusion, in the content of value, of an element created or added to the land by the Crown, does not constitute an indirect taxation of the Crown, contrary to section 125 B.N.A. Act.
Per Hudson J. (dissenting).—As to the Boeing Building: The lease was of vacant land, the building was erected at the sole expense of the Crown and was occupied and used exclusively for Crown purposes, and it was the intention of the parties to the lease that the building should be removed at the end of the term. Thus the Crown had the sole beneficial use and ownership of the building and the latter never became the property of the owner of the land. Therefore the tax levy based upon the assessed value of the building is a tax imposed on property "belonging to" the Crown within the meaning of s. 125 B.N.A. Act and "held by" the Crown under s. 46 (1) of the Vancouver charter. As to the Fumigation Station building: The lease differs in some material respects from that of the Boeing property. It contained a covenant by the Crown to erect the building, but there was no provision as to its disposition at the termination of the lease. The Crown had no more than a right to exclusive possession during the term; but there was sufficient to justify a finding that the property was "held by" the Crown within the meaning of section 46. The legislature has not chosen to make provision for distinguishing the interest of the Crown when a tenant and that of a registered owner of the freehold; nor has the appellant city attempted to make such distinction in the assessment and taxation of the land. When the tangible property is rightfully in the possession of the Crown and "held by" the Crown within the meaning of the statute, then such property is exempt as long as the term and possession continue. What remains, that is the intangible property, be it either legal or equitable, which belongs to the owner, may be taxed but, if it is the intention of the legislature to impose such tax, it should provide for the segregation of such interest and the imposition of the tax by a positive enactment.
APPEAL from the judgment of the Court of Appeal for British Columbia (1), affirming by a majority (Sloan J.A. (1) (1942) 58 B.C. Rep. 371; [1943] 1 W.W.R. 196; [1943] 1 D.L.R. 510. dissenting) the judgment at the trial of Coady J. and declaring that certain buildings either belonged to or were held by the Dominion of Canada and the province of British Columbia and that the respondent railway company was not liable for payment of taxes in respect of these buildings and that the latter should recover from the appellant an amount of $1,178.40 paid under protest by way of taxes.
H. E. Manning K.C. and j. B. Roberts for the appellant.
O. M. Biggar K.C. and W. H. Campbell for the respondents.
The judgment of the Chief Justice and Rinfret J. was delivered by THE CHIEF JUSTICE.—The procedure laid down by the Vancouver Incorporation Act for the taxation of land may, so far as we are concerned with it on this appeal, be outlined briefly.
The assessor is to prepare an assessment roll in every year (section 40) in which he is required to set down in respect to "each and every rateable parcel of land" certain particulars. These include::
(1) A short description by which the parcel of land can be identified on the books of the Land Registry Office.
(2) The name of the registered owner thereof.
(3) The value of the land estimated separately from the value of the improvements on it.
(4) The value of the improvements estimated separately from the value of the land.
The assessment roll is subject to revision, in a manner with which we are not concerned, and when it has been finally revised it is the duty of the Council (section 57) to "pass a by-law for levying a rate or rates on all the rateable property" on the roll. By section 58 the rate or rates shall "in respect of improvements, be levied upon not more than fifty per cent of the assessed value". The process of collection goes forward as prescribed by sections 59, 60 et seq. By section 59 it is the duty of the City Treasurer, or Collector of Taxes, to make out a tax roll or rolls in which there are "set down with respect to each parcel of land upon which taxes have been imposed" the following particulars inter alia:
(1) The name and address of the assessed owner or owners.
(2) The value at which the land and improvements are assessed.
(3) The total amount of taxes imposed for the current year.
Upon the completion of this roll it is the duty of the Collector (section 60) to proceed to collect the taxes thereon set out and "with respect to each parcel of land, transmit by post to the owner" a statement showing "what taxes are due upon such parcel of land". This statement must contain the particulars just mentioned, namely, the name and address of the assessed owner, the value at which the land and improvements are assessed, and the total amount of taxes imposed for the current year.
By section 63 it is enacted:
All rates, taxes, or assessments under this Act shall be due and payable not only by the owner of the property upon which they are imposed, but also by the possessor or occupant of the property, and by the tenant or lessee of such property, to the extent to which the possessor, occupant, tenant, or lessee is indebted to such owner, and the payment by any such person shall be a discharge of the property for the amount so paid, and shall also be a discharge to the possessor, occupant, tenant, or lessee of so much of his indebtedness to the owner as he shall have so paid.
By section 67 the taxes "accrued on any land" are a special lien on such land. By section 69 the Council is required in each and every year to pass a by-law providing for the sale by auction of each and every parcel of land and improvements thereon upon which taxes have been delinquent for a period of two years. By section 73 the Collector is obliged, after selling any land by public auction to any person other than the city, to give a certificate to the purchaser stating inter alia that a certificate of indefeasible title will issue to the purchaser at the expiration of one year from the date of sale on payment of the balance of the purchase money and other sums mentioned.
The statute gives a right of redemption to the owner and certain other persons having an interest in the land during the period of one year succeeding the sale. If the land is not redeemed, the purchaser is entitled to be registered as owner and to have issued to him a certificate of indefeasible title.
The land with which we are concerned on this appeal is described in the assessment roll as Parcel "G", D-L 2037. The letters D-L are an abbreviation of District Lot. This parcel so described admittedly was at the date of the assessment the property of the respondent railway company which was the registered owner in fee simple. Part of the parcel was by a lease dated the 1st of January, 1923, leased to His Majesty the King in right of the Dominion of Canada and to His Majesty the King in right of the province of British Columbia for a period of twenty years from the 1st of January, 1923. Pursuant to the provisions of this lease, certain buildings and erections were placed by the lessees on the premises; and another part of the parcel was by lease dated the 1st of May, 1940, leased to His Majesty the King in right of the Dominion of Canada and on these premises buildings were also erected by the lessee.
In the year 1941 the whole of the parcel of land in question was assessed as the property of the respondent railway company, the value of the improvements being set down as $521,900 and that of the land as $283,650. The Court of Appeal of British Columbia, by the judgment appealed from, held that the respondents are entitled to a declaration that the city of Vancouver was not entitled to assess the buildings mentioned erected on the parcel of land in question by the Crown in the right of the Dominion in the case of the Boeing Aircraft Building and by the Crown in right both of the Dominion and of the province of British Columbia in the case of the Vancouver Fumigation Building. The Court also held that the respondent, the railway company, was entitled to recover from the municipality the sum of $1,178.40, part of the taxes levied for the year 1941 pursuant to the assessment of that year.
On behalf of the respondents it is contended that the buildings mentioned are as to one of them the property of the Dominion Government and as to the other the property of the Dominion and Provincial Governments and as such are non-assessable and non-taxable. The contention is that these buildings have in the assessment in question been assessed as improvements and that the taxes have been unlawfully levied and wrongfully collected in respect of them.
The appeal turns upon the validity of this contention. I think that in considering it it is more convenient to examine the situation first of all as if the lessees were subjects and the interests of the Crown were not in any way involved. The respondent railway company being the registered owner in fee, the assessor rightly entered the company as the assessed owner. If the leases and the rights incidental thereto had been registered as charges, the lessees would have been entitled to give notice under subsection 4 of section 40 requiring notices of assessments and taxation proceedings to be sent to them and they would have been in a position to challenge the assessment before the Court of Revision and would have apparently been invested with a right of redemption on a sale of the property for default in payment of taxes; but the property assessed is, nevertheless, a parcel of land with its improvements. In my opinion, the provisions of the statute, to which I have referred, do not contemplate the assessment (as a separate subject) of improvements in an assessed parcel of land. There is a separate valuation of improvements, because in calculating the tax to be paid in respect of a particular parcel of land the rate is levied in respect only of fifty per cent of the assessed value of the improvements. The language is perhaps not as precise as it might be, but it seems very clear to me that what is assessed is the land as it stands with its improvements. The holder of a lease and the owner of a structure erected upon the land, not being the owner of the land, cannot be registered otherwise than as the owner of a charge. By section 143 of chapter 140, R.S.B.C. 1936, it is enacted:
The owner of the surface of land shall alone be entitled to be or remain registered as owner of the fee simple. The owner of any part of land above or below its surface who is not also the owner of the surface shall only be entitled to register his estate or interest as a charge ***
This view is supported by reference to the provisions of sections 59 and 60 and the terminology thereof, as well as to those of section 40. I think, moreover, that section 63 is conclusive upon this point. I have no doubt that "owner" of property in that section must be construed in light of sections 59 and 60, as well as section 40, and so construed it means the "assessed owner" and, therefore, in such a case as that before us, the registered owner in fee.
The owner, to whom the Collector is required by section 60 to post the notice therein provided for, can be none other than the owner whose name it is the duty of the assessor to set down in the roll under subsection (1) of section 40, that is to say, the registered owner.
As regards possessors or occupants, tenants or lessees, the taxes are due and payable only to the extent to which such person is indebted to the registered owner. The liability is primarily the liability of the registered owner; and where the possessor or occupant, tenant or lessee, is liable, his liability is only to pay out of the property of (his indebtedness to) such owner. The statute imposes no liability upon the owner of a charge, other than this limited responsibility of occupants, possessors, tenants and lessees under section 63. This limited liability is not imposed in respect of the interest of such persons in the property assessed, but is a liability only to discharge to the extent of the owner's monies in his hands the responsibility of the owner which is imposed upon the owner in respect of his ownership. I repeat, it is the rateable parcel of land entered and described in the assessment roll under subsection (1) of section 40 in respect of which the registered owner is liable to assessment and taxation. Emphasis is given to this by reference to the language of section 59 where the Collector is required to make out a tax roll or rolls "which may be an extension of the assessment roll" and in which shall be set down "with respect to each parcel of land upon which taxes have been imposed" the particulars therein mentioned, which include the assessed owner.
In the case I have supposed, therefore, in which, that is to say, the lessees, under such leases as those before us, are subjects, the assessed owner is liable; and section 63 shows that he is liable in virtue of his ownership. I repeat, his lessees are liable to the extent of monies of his they have in their hands. The equities and rights as between the owner and occupants, possessors, tenants or lessees, arising out of his liability to taxation on the full assessed value of the property, including improvements, is left by the statute to be adjusted by the parties themselves. The same principle seems to have been adopted as regards the owners of other charges.
I think counsel for the appellant corporation is right in his contention that for the purposes of the Land Registry Act and the Assessment Act the buildings in question are part of the land and the property of the owner of the registered fee, subject to the rights of the lessees under the leases. But, even if the respondents' contention is right, they are still taken into account only for the purpose of valuing the parcel of land, including the improvements, of which the respondent railway company is the registered owner and, as such, the assessed owner.
The lessees, however, in the case actually before us, are the Crown. In each case there is a term of years, created by an instrument of demise, in which the lessee has certain rights and obligations. It follows, therefore, that the liability imposed on occupants and tenants by section 63 is not operative in this case. It follows also that the enactments of the statute providing for the sale of lands for unpaid taxes and the vesting in the purchaser of an indefeasible title to such lands must equally be inoperative. Section 67 is also inoperative so far as any interest of the Crown is concerned. The statute, that is to say, does not operate by way of attempting to impose any liability on the Crown in respect of any interest under or in relation to the leases in question and, in particular, in respect of the two buildings mentioned.
Moreover, the respondent company is assessed, that is to say, its property is valued, in precisely the same way in which it would be valued if the lessees were subjects. The tax rate is levied upon the assessed value of the assessed parcel of land, including improvements, and it is in virtue of its ownership in fee that, according to the legislative scheme, the rate is computed on this value.
It is perhaps proper to say in passing that there is nothing necessarily unfair or exceptional in such a method of taxation. The legislature may very well have thought it just that the registered owners in fee simple of land which is leased and occupied should be taxed upon a valuation proceeding upon the same basis as if the land were occupied by the owner or were vacant. Similarly the legislature has evidently considered it just to make the owner of the registered fee liable in respect of the full value of the parcel of land, including the improvements, leaving the equities to be adjusted between the owner of the fee and the owner of any charge. In City of Montreal v. Attorney-General for Canada [1], it was held that a provision in the charter of Montreal, under which persons occupying Crown property for commercial or industrial purposes should be taxed as if they were the actual owners of such immoveables, was not constitutionably objectionable.
It is clear enough, I think, from the judgment in Smith v. Vermillion Hills Rural Council [2], and the judgment in City of Halifax v. Fairbanks [3], that section 125 of the British North America Act must always control the enactments of any such statute as that before us, and, moreover, that the provisions of the statute ought to be construed by the light of that section, unless, at all events, there is language which is necessarily repugnant to it. The position of the Crown is dealt with in section 46 and I turn now to the consideration of that section. The pertinent provisions are as follows:
46. Except as otherwise in this Act provided, all land, real property, improvements thereon, machinery and plant, being fixtures therein and thereon, in the city shall be liable to taxation, subject to the following exemptions, that is to say:
(1) All property vested in or held by His Majesty or for the public use of the Province, and also all property vested in or held by His Majesty or any other person or body corporate in trust for or for the use of any tribe or body of Indians, and either unoccupied or occupied by some person in an official capacity:
***
(3) When any right or interest, whether legal or equitable, in any property mentioned in subsection (1) of this section is held, possessed, or enjoyed by any person other than in an official capacity, the owner of any such right or interest therein shall be assessed in respect of such right or interest, and shall be personlly liable to taxation in respect thereof.
I cannot agree that the registered fee in the property in question here is "held by His Majesty" in the sense of subsection (1). In any case, subsection (1) must be read with subsection (3) and, applying subsection (3) to the circumstances in this case, it would appear that if the language of subsection (1) is to be stretched in such a way as to comprehend such a case as this then subsection (3) would quite plainly extend to the ownership of the respondent railway company. The respondents' registered ownership in fee is certainly a "right" and must, therefore, be assessed as such a right is assessed, that is to say, as the registered fee is assessed. I should be disposed to think, however, that reading subsection (1) by the light of the first limb of subsection (3), "property" in subsection (1) must be construed (so far as concerns us now) as extending to any interest in property and that what is exempted by that subsection is any interest in property vested in or held by His Majesty. The interest so held by His Majesty in virtue of the leases before us, or of any rights arising therefrom, is not subject to taxation under this statute, but the registered owner of the land is liable to taxation in respect of its assessed value, in virtue of its registered ownership.
As to section 125 of the British North America Act. I have already referred to that section, but I think it proper to add that, in the view of the statute to which I have given effect, its operation does not involve the imposition of taxation upon any lands or property of Canada, or of the province of British Columbia.
The appeal should be allowed and the action dismissed with costs throughout.
DAVIS J.—This is an appeal by the city of Vancouver from the judgment of the Court of Appeal for British Columbia which affirmed (Sloan J.A. dissenting) the judgment of Coady J. at the trial—holding that the respondents were entitled to a declaration that the city of Vancouver was not entitled to assess for any sum of money two buildings erected on lands belonging to the respondent, Canadian Northern Pacific Railway Company, by the Crown in right of the Dominion in the case of one building and by the Crown in right both of the Dominion and of the province of British Columbia in the case of the other building, and holding further that the respondent railway company was entitled to recover from the city the amount of a payment it made "under protest" of part of the taxes in and for the year 1941, upon an assessment of the respondent railway company for the aggregate of the land and improvements thereon.
The Vancouver Incorporation Act, 1921, and amendments thereto, provides for the annual raising of money for the purposes of the municipality by the levy of rates on land within the municipality. Buildings and other things erected upon or affixed to the land, and all machinery and other things so fixed to any building as to form in law a part of the realty, are by s. 2 (10) of the statute included within the definition of the word "land". And by s. 2 (9), "improvements" shall extend to and mean all buildings and structures erected upon or affixed to the land and all machinery and things so fixed to any building as to form in law a part of the realty.
It was agreed by counsel at the trial (a) that the buildings in question are substantial structures attached to the freehold; (b) that the respondent railway company is and has been the registered owner of the land at all material times; (c) that both buildings are on the property of the said company; and (d) that no question arises in the action as to whether the taxes were regularly levied by the city pursuant to its regular practice. Notwithstanding a rather loose and sometimes interchangeable use by the draftsman of the words "assessment" and "valuation", the effect as I read the statute is that the basis of computation for the assessment of an improved "rateable parcel of land" upon which the annual rate of taxation shall be levied is to take the estimated actual cash value of the land, as if it were unimproved, and then add not more than one-half the amount of the estimated value of the improvements (sections 39, 46 and 58). It is not right, as I see it, to say, as contended by the respondents, that the buildings or improvements are to be taken separate and apart from the land taken by itself; that is the fallacy that undermines, it seems to me, the position taken in the relief sought by the respondents in this action. That there may be different interests or estates held by different persons in rateable property, whether vacant or improved, is recognized by the statute, but that does not involve the levying of rates against buildings or improvements as distinct and separate from the land upon which they are erected or to which they are affixed.
The parcel of land involved in this litigation is wholly owned by the respondent Canadian Northern Pacific Railway Company, and there was but one levy of rates for the year in question, 1941, and that was against the railway company, the owner of the land, on an assessment of the land and buildings thereon. But in respect of two large buildings erected by the Crown upon the land there are certain outstanding leases or agreements with the Crown, either in right of the Dominion or in right of the province of British Columbia. It is unnecessary to detail the provisions of the documents; sufficient to say that it is admitted by the city that the Crown, either in right of the Dominion or in right of the province, has certain rights or interests in the buildings. But no attempt was made by the city to assess or levy rates against the right or interest of the Crown, whatever it may be, or to tax the Crown in respect of the buildings or either of them. The owner of the parcel of land was the only one assessed and taxed and it was a levy of the annual municipal rates in respect of the entire parcel of land, including the improvements erected thereon.
Ample statutory provision is made for a Court of Revision for hearing all complaints against assessments, which Court, after hearing the complaints, as well as the Assessor, and such evidence as may be adduced, shall alter or amend or confirm the assessment roll accordingly (s. 48). Any person complaining of an error or omission or as having been undercharged or overcharged in the roll, may apply to the Court of Revision (s. 49). Then by s. 56 there is the right of appeal from the Court of Revision to a Board of Assessment Appeals and a further right of appeal from the Board to the Court of Appeal, which Court may raise or lower or otherwise correct the assessment of any property in respect of which such appeal is taken. By s. 55 the assessment roll as revised or confirmed and passed by the Court of Revision shall, except in so far as the same may be further amended on appeal, be valid, final, and binding on all parties concerned, subject, however, to such alterations, if any, as are made on appeal to the Board of Assessment Appeals or to the Court of Appeal, as the case may be.
The statement of claim in this action acknowledges that appeals were duly taken by all the respondents to the Court of Revision and to the Board of Assessment Appeals in respect of the assessment of the two buildings and that the said appeals were dismissed. This action then sought a declaratory judgment in favour of the respondents the Attorney-General of Canada and the Attorney-General for British Columbia and the company, and judgment in favour of the railway company for the return of a payment of the taxes made under protest.
The substantial answer to the action is that the city of Vancouver does not and did not assert any right to tax the Crown's interests, and those interests are not in any way affected or touched by the assessment and levy of the rates in question. The Crown's exemption by s. 125 of the British North America Act remains unimpaired; in fact the city's Act of Incorporation specifically provides by s. 46 (1) for the exemption from municipal taxation of all property "vested in or held by His Majesty or for the public use of the Province".
It is contended, however, that if the owner of the land has to pay taxes on the whole parcel, that will necessarily throw a portion at least of the taxes ultimately against the Crown, either by way of increased rental or by virtue of a covenant to indemnify in the leases or agreements between the owner and the Crown. But that argument is not a new one in the field of municipal taxation in this country and has been authoritatively rejected. It is no answer to the statutory liability to taxation that rests upon the owner of the land. Calgary & Edmonton Land Co. v. Attorney-General of Alberta [4]; Smith v. Vermillion Hills Rural Council [5]; City of Montreal v. Attorney-General of Canada [6]; City of Halifax v. Fairbanks Estate [7].
In this view of the case, it becomes unnecessary to consider the question whether the payment of a portion of the taxes that had been made by the owner, the railway company, could be recovered back as an involuntary payment when the payment was made merely "under protest".
I should allow the appeal with costs and dismiss the action. The appellant should have its costs of the action and of the appeal to the Court of Appeal from the Canadian Northern Pacific Railway Company.
KERWIN J.—The defendant in this action, the city of Vancouver, appeals from the judgment of the Court of Appeal for British Columbia affirming the judgment at the trial. The respondents, the Attorney-General of Canada, the Attorney-General for British Columbia, and the Canadian Northern Pacific Railway Company are the plaintiffs in the action. By the judgment complained of, it is declared that the Boeing Building, being on a portion of lot "G", plan 1341, in the city of Vancouver, and assessed as improvements on the said lot by the appellant at the sum of $42,500, is the property of His Majesty the King in right of his Dominion of Canada, or held by His Majesty in the right of his Dominion of Canada within the meaning of section 46 of the Vancouver Incorporation Act, 1921, and that the said building is not liable to taxation by the appellant. It is declared that the building known as the Fumigation Station and being on another portion of said lot "G" and assessed as improvements on the said lot by the appellant at the sum of $6,600, is the property of His Majesty the King, as in the right of his Dominion of Canada and His Majesty the King as in right of the province of British Columbia or held by His Majesty the King as in right of his Dominion of Canada and His Majesty the King as in right of the province of British Columbia within the meaning of section 46 of the Vancouver Incorporation Act, 1921, and is not liable to taxation by the appellant. It is also declared that the respondents are not liable to be assessed and are not liable for payment of taxes in respect of the said buildings.
It is admitted or may be assumed that these two buildings are "property belonging to Canada or any Province" within the meaning of section 125 of The British North America Act or "property *** held by His Majesty" within clause 1 of section 46 of the Vancouver Incorporation Act and are therefore not liable to taxation by the municipality. It should be emphasized, however, that the appellant never contended that it could assess the fabric of either building as land or improvements or that either building qua building was liable to taxation by it. Furthermore, it never claimed that the Attorney-General of Canada or the Attorney-General for British Columbia was liable to be assessed or was liable for payment of taxes in respect of either building.
The position adopted by the appellant is shown by what occurred in 1941. In that year the Vancouver assessor valued the land of the respondent Railway Company (lot G) and the improvements erected thereon, separately. Such improvements included not only the two buildings in question but also other buildings in which the Crown, either in right of the Dominion or province, had no interest. The Railway Company received from the office of the Assessment Commissioner a memorandum showing how the value of these improvements was arrived at and included therein were the sum of $42,500, for the Boeing Building and $6,600 for the Fumigation Station Building. However, neither these two buildings nor any of the other buildings were assessed. The land and all the improvements thereon were assessed as a unit, as appears from the following extract from the assessment roll:
Roll No.
Description of Parcel
Name and Address of Registered owner
Value of Improvements
Land Value
K-9568 9569
Parcel "G" D.L. 2037.
Canadian Northern Railway, c/o R. R. Nichol. Canadian National Railways, Winnipeg, Manitoba.
$ 521900
$ 283650 It is admitted that the respondent Railway Company owns Lot (or parcel) "G" and that it is the Company described as owner in the assessment roll. It is also admitted that no question arises as to whether the taxes were regularly levied by the city pursuant to its regular practice.
Although not put precisely in this form, the contention of the respondents really amounts to this,—that the Vancouver Incorporation Act requires the appellant to assess and tax the fabric of buildings separate and distinct from the land upon which they stand. Whether that contention be right or wrong depends upon the construction of the provisions of the statute relating to assessment and taxation.
It conduces, I think, to a better understanding of the scheme of the Act as to these two matters if reference be made first to taxation. By section 57, the Council of the city shall in each year after