COMPANY GARNISHEE May CROTEAU PLAINTIFF. APPEAL from decision of the Court of Kings Bench CLICHE DEFENDANT APPELLANT AND RESPONDENT AND

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1 384 SUPREME COURT OF CANADA 1925 CANADIAN NATIONAL RAILWAY COMPANY GARNISHEE May AND CROTEAU PLAINTIFF AND CLICHE DEFENDANT APPELLANT RESPONDENT Constitutional iaupractice and procedurecanadian National Railways GarnishmentProceedin pfiat-special leave of appealprovinciat appellate courts-jurisdictiondiscretioncanadian National Rail ways Act Geo 13 15Supreme Court Act Geo The discretion conferred on the provincial courts of appeal by section 41 of the Supreme Court Act under which special leave to appeal to this court may be granted is untrammelled and free from restriction save such as is implied in the term special leave writ of garnishment attaching moneys owed by the Canadian National Railway Corporation to judgment debtor in its employment is proceeding within the provisions of 15 of the Canadian Nationat Railways Act and may therefore issue without fiat from the Crown Idington dissenting APPEAL from decision of the Court of Kings Bench appeal side province of Quebec affirming the judgment of the Superior Court and maintaining seizure by garnish ment of defendants wages in the hands of the appellant The material facts of the case are fully stated in thejudgments now reported Gravel K.C for the appellant Lan glais K.C for the respondent The judgment of the majority of the court Anglin C.J.C. and Duff Mignault Newcombe and Rinfret JJ was delivered by PUESENT Anglin C.J.C and Idington Duff Mignault Newcombe and Rinfret JJ

2 S.C.R SUPREME COURT OF CANADA 36 DUFF J.This appeal raises question that chiefly turns upon the scope and effect of 15 of 9-10 Geo 13 CANADLkN which is in the following words Actions suits or other proceedings by or against the company in respect of its undertaking or in respect of the operation or management CROTEAU of the Canadian Government Railways ma/ in the name of the company Duff without fiat be brought in and may be heard by any judge or judges of any court of competent jurisdiction in Canada with the same right of appeal as may be had from judge sitting in court under the rules of court applicable thereto Any defence available to the respective cor porations including His Majesty in respect of whose undertaking the cause of action arose shall be available to the company and any expense incurred in connection with any action taken or judgment rendered against the company in respect of its operation or management of any lines of railway or properties other than its own lines of railway or properties may be charged to and collected from the corporation in respect of whose undertaking such action arose Nothing in this Act shall affec any pending litigation Any court having under the statutes or laws relating thereto jurisdiction to deal with any cause of action suit or other proceeding when arising between private parties shall with respect to any similar cause of action suit or other proceeding by or against the company be court of competent jurisdiction under the provisions of this section Cliche was person employed in the operation of the Canadian Government Railways as defined by 10 of this Act and certain moneys were owing to him as wages earned in his employment when the respondent having recovered judgment against him for $ proceeded to take out writ of garnishment attaching these money in the Superior Court of Quebec The appellant company objected that the proceeding was not competent inasmuch as it was an attempt to garnish the wages of an employee of the Crown nd that 15 did not authorize such proceeding The issue thus raised was decided in favour of the respondent by the unanimous judgments of the Quebec courts The Court of Kings Bench exercising the authority con ferred by 41 of the Supreme Court Act gave leave to appeal to this court It may be observed in passing that the learned judges of the Court of Kings Bench appear to have been under an impression that their jurisdiction under that section was limited by certain rules supposed to be laid down in this court touching the exercise of that jurisdiction This court has no authority and of course never pretended to exercise any authority to lay down rules restricting the scope of the Jurisdiction or governing

3 386 SUPREME COURT OF CANADA 1925 the exercise of the jurisdiction conferred by 41 upon pro- CANADIAN ROTEAU vincial courts of appeal The statute gives discretion to such courts and where statutory discretion is conferred upon court it is not within the authority of any other court to give directions as to the manner in which the dis Duff.T cretion is to be exercised Attorney General Emerson On theother hand one of the learned judges of the Court of Kings Bench would have refused leave to appeal because this case did not in his opinion fall within any of the sub-clauses to of the proviso to 41 of the Supreme Court Act That proviso with its several subclauses has to do only with the granting of special leave to appeal by this court where it has been refused by the provincial court of appeal and in nowise affects the discre tion conferred on the provincial court by 41 That dis cretion is untrammelled as is implied in the term special leave and free from restriction save such The general object of the A.ct of 1919 is stated in the preamble which after reciting that His Majesty on behalf of the Dominion of Canada has acquired control of the Canadian Northern Railway Company and the various con stituent and subsidiary companies comprising the Canadian Northern System proceeds to declare it to be expedient to provide for the incorporation of company under which the railways works and undertakings of the companies comprised in the Canadian Nor thern System may be consolidated and together with the Canadian Gov ernment Railways operated as national railway system In order to effectuate this purpose the Governor in Council is authorized to nominate directors not fewer than five and not more than fifteen with such remuneration as may be determined by the Governor in Council who to gether with their successors shall constitute the corporation known as the Canadian National Railway Company Directors are removable for cause by the Governor in Council by whom also vacancies are to be filled The Gov ernor in Council is authorized also to declare that the com pany shall have capital stock with or without shares such stock being unless otherwise ordered vested in the Minister of Finance on behalf of His Majesty The Act also provides that no director of the company shall be under any personal responsibility to any share 24 QB.D 56 at pp 58 59

4 S.C.R SUPREME COURT OF CANADA 387 holder director officer or employee of the company or to 1925 any other person or except with the approval of the Gov- CANADIAN ernor in Council subject to any pecuniary penalty under the provisions of any statute in respect of his office or any act done or omitted to be done by him in the execution ROTEAU thereof By 11 the Governor in Council is authorized to Duff entrust to the company the management and operation of any lines of railway or parts thereof and any property or works of whatsoever description or interests therein and any powers rights or privileges over or with respect to any railways properties or works or interests therein which may be from time to time vested in or owned controlled or occupied by His Majesty or such part or parts thereof or rights or interests therein as may be designated in any order in council upon such terms and subject to such regulations and conditions as the Governor in Council may from time to time decide such management and operation to continue during the pleasure of the Governor in Council and to be subject to termination or variation from time to time in whole or in part by the Governor in Council Powers are also given to the company with the approval of the Governor in Council to construct and operate rail way lines branches and extensions and to issue bonds de bentures and debenture stock By 13 the provisions of the Railway Act with certain exceptions not material are made applicable to the company and its undertaking and by 14 it is declared that the provisions of the Railway Act respecting the operation of railway shall apply to any of the Canadian Government Railways the operation and management of which may be entrusted to the company and by where any consent or approval by shareholders of company is required by the Railway Act such consent or approval may be given by the Governor in Council Prima facie by force of the provisions of the Interpret tion Act the incorporation of the company itself invests it with the capacity to sue and to be sued in its own name Section 15 appears to proceed upon the assumption that the company when acting within the scope of its powers is responsible for the acts of its employees within the scope of their authority The section on any hypothesis cannot he regarded as very happily framed but there does not appear to be any satisfactory reason for limiting the scope of the word proceedings in the first sentence of it in such way as to exclude the process of attachment It seems difficult to make good any distinction between moneys payable by the company in respect of its under taking and moneys payable

5 388 SUPREME COURT OF CANADA 1925 in respect of the operation or management of the Canadian Government CANADIAN NATIONAL Railways Section 15 recognizes the enforceability of the obligation RAILWAYS in both cases alike True by 16 wages of the employees CROTEAU of the Canadian Government Railways are payable out of Duff moneys which are furnished either directly out of the Con solidated Revenue Fund or from the revenues and re ceipts of the Government Railvays and the surplus of these after providing for the expenses incident to the operation and management of such railways belongs to the Consolidated Fund nevertheless 15 does recognize as already stated an obligation on the company to pay Payment of such debts is one of the purposes for which the fund provided for by 16 is put into the companys hands The real difficulty in attaching moneys payable by the Crown to third person lies in the inability of the courts to make an order against the Crown Generally speaking moneys payable by the Crown are subject to equitable execution the appointment of receiver operating as an injunction prohibiting the judgment debtor from receiving the fund attached The process involves no order against the Crown Only by leave of the court and of course after fiat granted can the judgment creditor proceed to enforce the judgment debtors claim by petition of right The position may be illustrated by reference to sequestration Sequestration will lie to attach moneys payable by the Crown subject to this that no order against the Crown can be made Wilicock Terrell Here again the process operates only inlirectly by precluding the judg ment debtor from receiving payment Now 15 whatever its limitations does contemplate judgments against the company for the payment of money in actions arising out of the operation and management of the Government Railways as well as in other cases Moreover the use of the word suits in addition to actions indicates that equitable proceedings_proceedings of that class which normally culminate in judgment in personam are contemplated by the section The necessary effect of 15 would therefore appear to be that it removes the im pediment which normally prevents the attachment of public moneys owing to judgment debtor and it would there Ex 323

6 S.C.R SUPREME COURT OF CANADA 389 fore appear to be in harmony with the principle and policy of the section to attribute to the word proceedings CADxAN scope which would bring within the ambit of the section JJ7 the kind of proceeding that is in question here As opposed to this view an argument is based ROTEATJ upon the presence in 15 of the words without fiat It is sug- gested that these words point to an intention to limit the operation of the section to proceedings of like character with those which according to the usual practice would be competent to suppliant as against the Crown on fiat being granted Now the phrase without fiat grammatically applies to proceedings by the company as well as to proceedings against the company As applied 1925 IUffJ to the former it seems in this context to be almost if not quite meaningless Even as applied to proceedings against the company it is not very apt expression The more probable inference seems to be that it was introduced ex majori cautela to quiet the apprehensions of some not very highly instructed persona not uncommon thing as Lord Herschell observes in Commissioners of Income Tax Pemsel If the intention was to limit the scope of the section as suggested it seems strange that the meaning of the section should be left to be gathered by doubtful inference and on the whole the better view seems to be that such was not the intention It has not been argued it should be added that by any rule of public policy the wages attached were inalienable and no opinion is expressed upon any such question The appeal should be dismissed with costs IDINGT0N dissenting.the appellant is company incorporated by virtue of 13 of 9-10 Geo of the Domin ion Parliament as an instrument of the Dominion Govern ment to aid it in discharging duties devolving upon the said Government in relation to the management and operation of certain specified railways The respondent Croteau claims that Cliche the above named defendant in the Superior Court of Quebec owes him and that he is entitled to garnishee the appellant in respect of wages due by the Intercolonial Railway Gov A.C 531 at 574

7 390 SUPREME COURT OF CANADA 1925 ernment-owned railway The appellant objects to recog CANADIAN nizing any such mode of execution against it By 18 of 35 of the Revised Statutes of Canada 1906 which reads as follows CROTEATJ 18 Moneys in the hands of an officet employees or servant of the IdingtonJ Minister as an officer or servant of His Majesty due or payable by His Majesty to any person or out of which any payment on behalf of His Majesty is to be made and given to or being in the possession of such officer employee or servant for the purpose of making such payment shall not be subject to any execution attachment or garnishee process If any such officer employee or servant is served with any execu tion attachment or garnishee process in regard to such moneys the same may be set aside with costs by any court of competent jurisdiction it would seem clear that such proceeding is expressly pro hibited The respondent points to 15 of said Act 13 of 9-10 Geo which reads as follows 15 Actions suits or other proceedings by or against the company in respect of its undertaking or in respect of the operation or management of the Canadian Government Railways may in the name of the company without fiat be brought in and may be heard by any judge or judges of any court of competent jurisdiction in Canada with the same right of appeal as may be had from judge sitting in court under the rules of court applicable thereto Any defence available to the respective corpora tions including His Majesty in respect of whose undertakings the cause of action arose shall be available to the company and any expense in curred in coilnection with any action taken or judgment rendered against the company in respect of its operation or management of any lines of railway or properties other than its own lines of railway or properties may be-charged to and collected from the corporation in respect of whose undertaking such action arose Nothing in this Act shall affect any -pend ing litigation Any court having under the statutes or laws relating thereto juris to deal with any cause of action suit or other proceeding when diction arising between private parties shall with respect to any similar cause of action suit or other proceeding by or against the company -be court of competent jurisdicton under the provisions of this section cannot see that this section ever was intended to repeal the said 18 or touch upon such questions as therein re ferred to or in any way to justify such proceeding as the garnishee in question There was no fiat recognizing this proceeding and the local legislature of province cannot give any power to its courts to interfere with the rights of the Crown on behalf of any work done under or by virtue of Dominion legisla tion beyond what that expressly empowers it to do as in and under for example such as above quoted and which as already stated is not wide enough

8 S.C.R SUPREME COURT OF CANADA 391 Nor do think the 14 of the said Act of 9-10 Geo helps respondent CANADIAN would therefore allow this appeal with costs and dismiss said garnishee Appeal dismissed throughout with costs Solicitors for the appellant Pentland Gravel Thompson Hearn Solicitors for the respondent Langlais Lan glais Godbout NATIONAL RAILWAYS CROTEAU Idington