[Stage Direction]
Bill (No. 180) respecting the Montreal Bridge and Terminal Company.-Mr. Martin.
Bill (No. 181) for the relief of Laura Mc-Quoid.-Mr. Nesbitt.
Bill (No. 182) for the relief of Fleetwood Howard Ward-Mr. Bradbury.
Bill (No. 183) for the relief of Aaron Wm. Morley Campbell.-Mr. W. H. White.
Bill (No. 184) for the relief of John Christopher Cowan.-Mr. Turriff.

[Stage Direction]
Mr. ETHIER moved that the 8th report of the Select Standing Committee on Miscellaneous Private Bills be concurred in as follows:
Your committee have considered the following Bills and have agreed to report the same without amendment, viz.:-
No. 142 (Letter F of the Senate), intituled:
' An Act to incorporate the Governing Council of the Salvation Army in Canada.'
No. 136	(Letters	GG of	the	Senate),	intituled : ' An Act for the relief of Hannah Ella Tomkins.'No. 157	(Letters	00 of	the	Senate),	intituled: 'An Act for the relief of John Dennison Smith.'As no petition was received in the House within the first six weeks of the session in connection with either of the two last-mentioned Bills, the said Bills became liable to the additional charge of $200 under the provisions of Rule 88 (8), which charge was duly levied and paid	in each	case;	as,	however,	thecounsel for both the applicants 6tated before your committee that the omission to present the petitions in the House was the result of	misleading information furnished
him in the Senate, your committee recommend that the said additional charge be refunded in each case.
Sir WILFRID LAURIER.: This is a motion to approve the report of the Select Standing Committee. I beg to move in amendment that the last paragraph of the report be struck out and that the report as amended be agreed to as follows:
As no petition was received in the House within the first six weeks of the session in connection with either of the two last-mentioned Bills, the said Bills became liable to the additional charge of $200 under the provisions of Rule 88 (8), which charge was duly levied and paid in each case; as, however, the counsel for both the applicants stated before your committee that the omission to present the petitions in the House was the result of misleading information furnished him in the Senate, your committee recommend that the said additional charge be refunded in each case.
When the rules were revised, it was provided that the fee on private Bills would be a certain sum, and then, if the Bill were not presented within the time prescribed by the House, there should be an additional charge. This report recommends that the additional fee should not be charged, giving as an excuse that the petitioners were misled by^ the Senate as regards the time within which the petition should be presented. That excuse is not sufficient. We should strictly adhere to the rules.


[Stage Direction]
Amendment agreed to, and report as amended agreed to.

Mr. FOSTER.: May I be allowed to inquire again with reference to the Civil Service Bill. The point between us two months ago was as to the schedules. We agreed on a form which was to be attached in each case. I remember the conversation which took place. It was understood that a great majority of those schedules would elicit no contention, but there might be some regarding which there would be some contention. Is it possible that the schedules could be laid before the House so that we might have a chance to look over them before the Bill comes up?


Mr. FISHER.: All the schedules are prepared, so far as the departments are concerned, and I shall be happy to lay them on the table. The schedules for the employees of the House of Commons, the Library and the Printing Committee are already on the table but not adopted. Those of the departments were adopted and passed by the Governor in Council. Those of the House of Commons and the library employees and the employees of the Printing Committee, who are joint employees of the Senate and the House, are now on the table for approval. The employees of the Senate, we have no control over, and their schedules are before the Senate but not yet approved. I will see that the schedules for the departments are laid on the table this afternoon.


George Eulas Foster: I understood last night our arrangement was that those would be taken up on Monday. How much longer are we to delay or is it possible to go on with the legislation, even if the Senate and the government do not come to an agreement. That need not necessitate the delay of the whole Bill or will it?


Sydney Arthur Fisher: It need not if the House will be willing to have the schedules of the departments put in as the schedules of the Bill and a lump sum granted for the employees of the Senate and this House in those schedules. If the Senate does not adopt the schedules for its employees, we

can make provision for them, as far as we know how.


Mr. R. L. BORDEN.: What is the difficulty? Is there some difference of opinion between the Senate and the government?


Sydney Arthur Fisher: The government have nothing whatever to do with the classification of the Senate.


Robert Laird Borden: Why does the Senate not make the classification?


Sydney Arthur Fisher: I have been speaking to various senators and members of the government in the Senate and have been urging them, but so far without success.


Wilfrid Laurier: As my hon.
friend from North Toronto knows, the Civil Service is. always a difficult matter to deal with.


Robert Laird Borden: If the Senate appropriations are in such a shape that the employees will not be paid until the classification is put through, that might expedite the business.


George Eulas Foster: I see in the press that the difficulty arose because of the objection of the Civil Service Commission to the classification. Has that anything to do with it?


Sydney Arthur Fisher: Not the slightest. Any such rumour, I am sure, is unfounded.



MR. W. T. R. PRESTON.

Robert Laird Borden: I would like to ask whether the government has any information with regard to the proceedings of our trade commissioner in Japan. I have had newspapers sent to me from time to time; and though not disposed to trust implicitly to everything contained, even in a Japanese newspaper, with all deference to my hon. friends the Minister of Labour (Mr. (Lemieux) and of the Minister of Agriculture (Mr. Fisher) our trade commissioner seems to be carrying on most extraordinary antics in this country, according to those journals, and some restraining influence had better be put on him. If the accounts are to be believed he seems to be running amuck with every commercial body and interest he can find willing to engage in combat. The result is that not only the gentleman-himself, but the government he represents, is more or less brought into controversy and conflict with certain important public and commercial bodies in Japan; if these statements are correct.


Wilfrid Laurier: I am pretty sure they are not correct. At all events, we have no information to that effect, either officially or semi-offieially, or of any kind.


Robert Laird Borden: Has my right hon. friend received the newspapers?


Sydney Arthur Fisher: 


Wilfrid Laurier: I receive so many that I cannot undertake to read them all, but I should think that if any of our officers have given offence in the way suggested, we would have received official notification.


Robert Laird Borden: I shall send the right hon. gentleman just one of those which have come to me, and he will be able to judge whether or not my remarks have any foundation, if any credence is to be given the press.


Wilfrid Laurier: Of whom do you speak?


Robert Laird Borden: Of Mr. Preston. I thought he was our trade commissioner in Japan.


Wilfrid Laurier: He was, but he has been transfered to Holland.


Robert Laird Borden: I must apologize to the new trade commissioner in Japan, If there be one. I was referring to Mr. Preston. I was not aware until the Prime Minister spoke, that he had again been translated.


Wilfrid Laurier: That is another reason not to believe in the newspapers.


George Eulas Foster: What is the trouble in Holland that he has been sent there?


Robert Laird Borden: Possibly he has gone there to attend the Hague conference, or perhaps he has gone to assist in arguing the fishery case in that country.


Mr. FIELDING.: Or the celebration of the recent happy event in Holland.



ONTARIO AND MICHIGAN POWER COMPANY.

[Stage Direction]
Mr. CONMEE moved third reading of Bill No. 34 to incorporate the Ontario and Michigan Power Company.
Mr. LENNOX.: I am sorry to have to ask to have this matter referred back for amendment to the Committee of the Whole. In going through the sections yesterday, I called attention to the fact that certain standing provisions respecting telegraphs and telephones were omitted, and it was thought they would be found in subsequent sections of the Bill, but that is not the case. I move that the Bill be referred back to the Committee of the Whole to insert the following two clauses as subsections:
No toll or charge shall be demanded or taken for the transmission of any message or for leasing or using telegraphs or telephones of the company until approved by the Board of Railway Commissioners for Canada who may also revise such tolls and charges from time to time.

3. Part two of the Telegraph Act shall apply to the telegraph business of the company.


[Stage Direction]
Motion agreed to, and House went again into committee.
Mr. CONMEE.: I think my hon. friend is correct, that was the intention and I think that is provided, because the Bill is under the Railway Act; however, I can see no harm in having those subsections in it.


Haughton Lennox: There was a similar provision in the Alberta and Brazeau River Power Company Bill.


[Stage Direction]
Amendment agreed to, Bill reported.
Mr. CONMEE moved third reading.
Robert Laird Borden: Before this motion is carried, I would like to say that a great many objections to the Bill, in the first instance, seem to have been removed. The Prime Minister last evening expressed the opinion that this parliament has power to expropriate land belonging to and used or about to be used by a provincial government. I take absolute issue with him on that point. On principle, I think that this parliament has no power whatever in that respect, and the exercise of such power would lead to most absurd conclusions.
If this parliament, acting within the ambit of its jurisdiction, can expropriate or authorize the expropriation of lands belonging to the provincial government, then the legislature of the province, acting within the ambit of its jurisdiction, can authorize the expropriation of lands belonging to the government of Canada. There is no escape from that. If my right hon. friend's view were correct, the western provinces could get their lands back from Canada by expropriating them. They are the property of Canada, but the western provinces could expropriate them, and probably expropriate them without much compensation; because the ordinary principle of compensation, as any one who has bestowed the slightest attention upon the subject knows, is the value of the land, not to the person who expropriates, but to the person from whom it is expropriated. I have only to recall a very familar instance in which land in the very heart of London, owned by church wardens and vestry and incapable of being used by them except to let it remain as a churchyard, was expropriated by a railway company, to whom it was worth hundreds of thousands of pounds, but the church wardens and vestry could get no compensation for it whatever, because the basis of compensation was the value of it to them, and not the value to the railway company. So, if the power contended for existed, I would invite my friends from the west, who are interested in
the point to seize this opportunity and have the lands expropriated, because I can assure them that under the ordinary principles of valuation in such cases, very little would have to be paid for them. But, as a matter of fact, it seems to me that no such power exists. If it did exist, could not the parliament of Canada authorize the expropriation of the parliament buildings at Toronto, could not the legislature of Ontario return the compliment by authorizing the expropriation of land upon Parliament Hill, including, no doubt, $he site of the new hotel to be built in Major's Hill park. These powers do not exist. Nor, as I understand it, does this Bill purport to confer any such powers. It is an elementary principle of the construction of a statute that the Crown is not bound unless the Crown is named. That is a principle that has prevailed in the construction of statutes in Great Britain for the last six hundred years, and it prevails in the construction of our statutes as well. Therefore, inasmuch as this Bill does not purport to bind the Crown, it does not bind the Crown; it would not bind the Crown even if we had the power to bind it in this regard, which I contend we have not. Under these circumstances, with all deference to the members of the government of Ontario, and to the Attorney_ General of Ontario, I do not think that this Bill is so drafted that the province of Ontario has anything to fear from it in that Tegarcl. I agree with the view expressed by my hon. friend the Minister of Railways and Canals (Hon. Mr. Graham), and I think by the Prime Minister (Sir Wilfrid Laurier), last evening, that the Bill does not purport to do anything of that kind. 1 think the Prime Minister did make an exception with regard to the Nipigon river. But I do not know any authority for that. I think authority must be got from the legislature of Ontario before that can be done. Ontario could take proceedings to prevent trespass upon its lands, notwithstanding the enactment of this statute, and properly so. Why should this parliament undertake to give access to Ontario lands without the authority of the province, when the province, through its government and legislature, could give all necessary powers P Each government is sovereign within the ambit of its jurisdiction. And the principle of home rule in the Dominion of Canada has been carried out to that extent. Not only is the government and parliament of the Dominion of Canada all powerful within the ambit of its jurisdiction, subject, of course, to the legal power-but not the constitutional right-of the imperial government and parliament to interfere, but the provincial government and parliament is all powerful within the ambit of its

jurisdiction, subject to the powers reserved to this government under the British North America Act, especially the power to check provincial legislation -by means of disallowance. So, in that regard, I do not see any difficulty on the part of the government of the province of Ontario. But it does seem to me that the Bill is open to objection in another respect, and that is that the powers of expropriation undoubtedly will enable this company to gather up the interests of private persons in the localities which are mentioned in this Bill, and possibly to make a monopoly of them. I do not know enough of the local conditions to justify one in saying that a monopoly will be created, but it does seem to me that the granting of expropriation powers such as are given in this Bill has a tendency in that direction.


James Conmee: The hon. member (Mr. R. L. Borden) will remember that the company, under the Bill as it is now, is confined to one river, so far as expropriation powers are concerned, and to one point only on that river. Therefore, the idea of monopoly, I think, is eliminated.


Robert Laird Borden: That is the only objection I have to the Bill. I do not think it wise to grant powers of expropriation for purposes such as this, inasmuch as the grant of such powers must inevitably tend to the creation of a monopoly in waterpower, and water-power is the all essentia] thing to be conserved for the benefit of the people of the whole country. If my hon. friend from Thunder Bay and Rainy River (Mr. Conmee) can convince me that the Bill does not tend in any way to the creation of monopoly, then, I think, his Bill in every respect is absolutely reasonable. And I think the hon. member (Mr. Conmee) has been very reasonable indeed in his conduct with regard to .the Bill. He has agreed to eliminate many objectionable features, and I have no fault to find with his attitude on the Bill in -that respect. I dare say that he has very good precedents even in the matter to which I object. At the same time, we must not forget that new ideas and conditions are beginning to obtain in Canada with respect to matters such as this, that whatever the policy may have been in the past, the policy of the future should not in any way tend to the creation of a monopoly in the water-powers of Canada.


Wilfrid Laurier: I said yesterday, speaking upon this Bill, that, in my estimation and judgment-and I still adhere to my position-we have the power in this parliament to expropriate, but not to the broad measures my hon. friend (Mr. R. L. Borden) suggests which would carry the doctrine to an absurd degree. The position Mr. R. L BORDEN.
which I take, and upon which I challenge everything that the hon. member has said, is this:	This parliament has power to
make laws for the peace, order and good government of Canada; this power carries with it all the corollary powers necessary to give effect to our legislation. One of our duties is to provide for public works. If, for instance, we order the construction of a railway, necessarily we have to give to the entity which we create the power which will make this enterprise effective, otherwise our powers would be nugatory, we should be giving a power which we could not enforce. Until it is settled otherwise by judicial authority, I contend that we have the power to enact any law that we think for the best interest of Canada, and the corollary power to do anything necessary to that end. We can even invade civil rights, though vested in the province. I agree with my hon. friend that the provinces have as much power within their authority as this parliament has. This is good Liberal doctrine, and it was fought out in years past, and I am glad to see it accepted to-day. The province is supreme within its authority, as the Dominion is supreme within its authority, and we have a right here to do all that is necessary to carry out any work which we provide for.


Mr. CARVELL.: Before this Bill is carried, I wish to refer my hon. friend the leader of the opposition to a case decided in the Supreme Court of British Columbia, in 1904, which he will find in Volume 11 of the British Columbia Reports. It is the case of the Attorney General of the province of British Columbia vs. the Canadian Pacific Railway Company. I refer particularly to the judgment of Hunter, Chief Justice, found on page 297. This question involved the right of the Canadian Pacific Railway Company to take lands which were admitted to be the property of the province of British Columbia, and the Chief Justice in giving the decision, uses these words:
On the other hand, it has never been doubted, so far as I am aware that parliament, in the exercise of its railway j urisdic-tion, may provide for the expropriation of such private interests in land as may be required for railway purposes. If the interest of one man may thus be taken, then why may not parliament do the same in the case of lands, the beneficial ownership of which is in the inhabitants of a province collectively, i.e., Crown lands.
He goes on and decides that once this parliament has jurisdiction to create a railway company then that company has power to expropriate any land, even Crown lands of the province of British Columbia. The same doctrine is laid down by Martin, Justice, pages 304 and 305, of the same volume.
I will not take up the time of the House in reading these decisions, I will send them

over to my hon. friend, and he will see that I am correct in the doctrine laid down that once the parliament of Canada incorporates a railway company with powers of expropriation, that company has power to expropriate the lands of a province.


Robert Laird Borden: So far as my hon. friend has quoted the decision it is an authority in support of his view. But with all deference to that court, I would like to see the judgment reviewed by the Judicial Committee of the Privy Council.
House divided on motion for third reading.
YEAS:
Messieurs
Alien,
Aylesworth,
Beauparlant,
Beland,
Bickerdike,
Brodeur,
Bureau,
Calvert,
Carvell,
Cash,	.
Chisholm
(Antigonish), Chisholm (Inverness) Clark (Red Deer), Clarke (Essex), Congdon,
Conrnee,
Dugas,
Ecrement,
Emmerson,
Ethier,
Eielding,
fisher,
Fortier,
Gauvreau,
Gladu,
Graham,
Guthrie,
Hunt,
Knowles,
Lapointe,
Laurier (Sir Wilfrid) Laver gne,
Law,
LeBlanc,
Lemieux,
MeCraney,
McGiverin,
McIntyre (Perth), McIntyre (Strathcona),
McKenzie,
McLean (Huron), McLean (Sunbury , Marcile (Bagot), Martin (Montreal, St. Mary's),
Martin (Regina), Martin (Wellington), Michaud,
Miller,
Molloy,
Murphy,
Oliver,
Pardee,
Parent,
Pickup,
Proulx,
Prowse,
Pugsley,
Rankin,
Reid (Restigoucbe), Richards,
Rivet,
Ross,
Roy (Dorchester),
Roy (Montmagny), Rutan,
Savoie,
Sealey,
Sinclair,
Templeman,
Todd,
Turcotte (Nicolet), Turcotte (Quebec County),
Turgeon,
Turriff,
Warburton,
White
(Victoria, Alta)-76.
NAYS:
Messieurs
Armstrong,
Arthurs,
Barker,
Barnard,
Barr,
Borden (Halifax), Bradbury,
Burrell,
Crosby,
Crocket,
Crothers,
Daniel,
Lancaster,
Lennox,
Lewis,
Macdonell,
Maddin,
Magrath,
Marshall,
Northrup,
Paquet,
Perley,
Sharpe (Lisgar), Sharpe (Ontario),
Foster,
Goode ve,
Haggart (Lanark), Haggart (Winnipeg), Henderson,
Herron,
Jameson,
Kidd,
Lake,
Smyth,
StanBeld,
Taylor (New Westminster),
Wallace,
Wilson (Lennox and Addington), Wright.-39.


Mr. CALVERT.: I beg to call attention to the fact that the hon. member for South Oxford (Mr. Nesbitt) has not voted.


Mr. NESBITT.: I was paired with the hon. member for Grenville (Mr. Reid) ,-otherwise, I would have voted for the motion.


[Stage Direction]
Motion agreed to, and Bill read the third time and passed.

[Stage Direction]
House again in committee on Bill (No. 56), respecting the Canada Life Assurance Company.-Mr. A. H. Clarke.
On section 2, expressions used in chapter 71 of the statutes of 1879 defined.
Mr. HENDERSON.: I have, on different occasions, in the standing committees of this House and in the House itself, expressed my opinion of this Bill, and it is only a keen sense of my duty to my constituents, to those whom I represent, that impels me again, at this time, to give my opinion upon the legislation that is offered to the House now. It may be remembered that a few days ago I moved a resolution asking that the Bill be referred back to the Committee on Standing Orders, in order that the House might be informed whether the notices that have been recently published were sufficient or insufficient for the purposes of this Bill. I did so feeling keenly that although the notice had been widely circulated it did not come within the requirements of our standing rules, that, inasmuch as the Bill sought to enact retroactive legislation, the notice to the public to appear and look after their interests did not refer in any way to retroactive legislation. I simply draw the attention of the House to this matter because it goes to show that either intentionally or unintentionally those in charge of the Bill did not give to the public that intimation that I think they ought to have that the rights of the policy-holders were to be taken away from them not only in the future, but in respect to the past thirty years. There is no doubt that the use of the word ' are ' in the notice did not cover what is contained in the Bill in which the words ' were ' and ' are ' are used. The word 'are' would not relate altogether to existing policies. Why the notice was put in that form I cannot say, but this I did regard as



' COMMONS

[Stage Direction]
a sufficient reason for asking the Bill to go back to the committee to be again reported upon. Following that motion, my hon. friend from South Simcoe (Mr. Lennox) moved that the Bill be referred back to the Committee on Banking and Commerce in order that the policy-holders who are so deeply interested in this Bill should have an opportunity of being heard and of expressing their views upon a matter which is of far reaching importance to them and to the dependants of those who have taken out life policies. I do not wish to reflect upon the House, but I regret very much indeed that the House did not see fit to allow the Bill to go back to the committee after so much money had been expended in advertising the Bill so as to permit policy-holders, of whom it is alleged there are 35,000 or 40,000 interested, to appear before the committee and state their reasons why they do not approve of this legislation. This Bill has been discussed in the House. Some weeks ago we had an important discussion and then the hon. Minister of Justice (Hon. Mr. Aylesworth) expressed himself very freely and gave a decided opinion as to what he thought was the main characteristic of the legislation. To my mind, the kernel of the whole matter lies in the question: Was there a mistake in the legislation of 1879? We are now asked to declare that what is contained in an Act of Parliament passed in 1879 means something different from what the ordinary acceptation of the English words used in the Bill would indicate. We have, what I may say, is the highest legal authority in Canada and the highest legal authority in Great Britain for the opinion which we hold.
We do not believe that there was a mistake in the legislation of that day, not a tittle of evidence has been produced before the Committee on Banking and Commerce of any mistake, beyond the mere statement of the solicitor who had charge of a Bill before the Banking and Commerce Committee, Mr. L. G. McCarthy, who was a mere child at that time and could not possibly have any personal knowledge of the matter. I grant that a deep impression was made on the Banking and Commerce Committee by the statement of Mr. McCarthy, the solicitor, that Mr. A. G. Ramsay, who was for a long time manager of the company and who is a man for whom we all have the highest regard, considered that an error had been made away back in 1879. The statement was read hurriedly during considerable confusion, and, I think, very few of the members caught its drift. The moment the statement was read, instead of being handed to the clerk of the committee so that it could be examined it was deposited in the Mr. HENDERSON.
valise of the solicitor and hurried away, so that we had no opportunity of examining the original letter or knowing its contents until recently when it was published. It has been stated that a great deal of force should be given to the fact that the Banking and Commerce Committee had passed the Bill. To my mind no force whatever can be attached to that fact. The committee were misled by the statement of Mr. McCarthy who alleged that a mistake was made. The statement of Mr. Ramsay was not presented to the committee in such a way that they could intelligently understand its meaning, and I say without hesitation that I consider the committee was misled. So keenly did I feel the position at that time that I asked that no division be taken in the committee. I said then and I hold to the same idea now that this is too serious a question to throw into the cauldron of partisan politics, and hence I asked the committee not to divide on the question and there was no division. Hon. gentlemen may say that was a unanimous vote. It was not, because it was decidedly stated that we did not propose to divide the committee for the reason I have given and a number of us in the committee voiced our opposition to the Bill. Consequently when it is said that a great deal of stress should be laid on the position of that committee, I say on the contrary that it should have no weight whatever because it was not an expression of opinion by the committee. That was a strong reason to my mind why the Bill should have been sent back to the committee again foy further consideration after having learned all the facts and especially the fact that the committee had been misled by the statement that a mistake had been made in 1879. We were told the other day by a leading gentleman in the House that the first thing of which we should be satisfied is that there was a mistake. If there was no mistake in the legislation of 1879 then there was no ground on which to pass this Bill. If the legislation of 1879 was what the Canada Life Assurance Company asked for there is no room for the appeal to this parliament to change the wording of that Act of Parliament and substitute some other words. I propose to read section 4 of Mr. Ramsay's letter which to my mind comes the nearest to an explanation of the reason for now asking this legislation. This I apprehend is the clause on which Mr. McCarthy endeavoured to make the committee believe that Mr. Ramsay thought there was an error:
In the year 1879 it was deemed advisable to obtain an amendment to the company's Act of incorporation, and as the division of profits for upwards of thirty years had been made not in strict accordance with that Act, it was decided to apply to have it made clear

in future that the directors might make the allotment and division of profits from the entire business of the company
[Stage Direction]
That is from both participating and nonparticipating policies.
[Stage Direction]
among the persons assured on the participation scale and the shareholders, and might increase the proportion of such profits as between such policy-holders and the shareholders, and that was the object and intention of the recital in the Act passed, 42 Victoria, chapter 71, and of the first section thereof.
The whole business of a life insurance company consists of two things, dealing with participating policies and with nonparticipating policies. The investment of money, the investment of the reserve or capital is simply incidental to the carrying on of the insurance company's business or the issuing of participating and non-participating policies.
Mr. GUTHRIE.: What about annuities?


David Henderson: Annuities if they are profit policies would be included under these too. There was nothing in Mr. Ramsay's letter to indicate that there was a mistake or that parliament had been misled at that time.
I propose to look at the petition presented in 1879 in order to point out where the House and the committee have been misled, and to follow up the declaration of the Minister of Justice that the first thing to be satisfied of is that there was a mistake. If there was no mistake then I say that we have no right to pass this legislation. If the Bill of 1879 was what the company wanted, and if they knew what they wanted, and if people insured on the strength of that charter,_ j>aid their money and obtained their policies, then I say we have no right as a parliament here to-day to change the contracts between the assured and the company even supposing there was a mistake in the Bill the company itself was responsible for it, the policy-holders were not responsible for it there is no reason in the world why the policy-holders should have their rights taken away now, even although the company did make a mistake thirty years ago. But I submit there was no mistake, there is no evidence that a mistake was made. All the evidence direct and inferential is that there was no mistake whatever. The company applied for an amendment to their charter and they obtained what they wanted. Who had to do with this application? Mr. A. G. Ramsay, who was manager, I believe, in the year 1875, was a man of high standing, of good business qualities, who knew all about life insurance, a man who knew what the board of directors wanted.
I do not think he was managing director at that time, I am not sure of that, but at any rate he was on the board from 1875
until the time he left the company, about 1899. No doubt the board consisted of men of high standing, chiefly in Hamilton- men who knew what they wanted, men who knew how to ask for what they wanted, and who would not have asked for anything they did not want. Who was the solicitor of the company at that time? It was Mr. Alexander Bruce, for whom, I assume, every hon. gentleman who knows him has the highest regard. He is a good lawyer, able to advise the board of directors and draft a petition to this parliament. He was a member of the firm of Bruce, Walker and Burton, in Hamilton, as well as solicitor for the Canada Life. Mr. Walker, I believe, is dead. Mr. Burton afterwards became Jus-time Burton, showing the high standard of men who had to deal with this whole matter. They were not second or third class, but high class lawyers.


Mr. A. H. CLARKE.: What do you think of Mr. Bruce now?


David Henderson: Just what I always thought of him.
. ^A. H. CLARKE. He is the man who is asking for this. -


David Henderson: But he does not make the contention that Mr. Cox does-not by any means. I think I know Mr. Bruce's private opinion, and if Mr. Bruce had been willing to say there was a mistake, why did he not come forward in the Banking and Commerce Committee and say so? He did not do it because he is an honest man, and would not make a statement he did not be-"eve- This Bill was put in the hands of Mr. Thomas Robinson, then member for Hamilton, to present to this House. Who was he? He was a good lawyer, who afterwards became judge in the High Court of Ontario. All those who had to deal with this matter were men of high character and ability, who knew what they were doing, and no doubt did exactly what they wanted. And we are asked to-day to review what they did and to say that every one of them blundered.


Mr. LANCASTER.: Parliament must have blundered too.


David Henderson: Certainly, let me read who were in parliament at that time. Were they inferior to the men we have today? Let me take a list of them. I have the journals of the House for 1879 and will give you the list, and probably the hon. gentleman who says that a grievous blunder was committed in 1879 will change his mind when he finds that his own respeeted father was one of the men who assisted to pass the Bill. We find here men like the Hon. David Mills. Did he blunder? I had a very high regard for David Mills. Many a

time I listened to him in this House and I often asked him for advice and counsel, and he was always willing to treat young members fairly and give them the benefit of his experience. The Hon. Wm. Paterson was member for the House then. Did he make a blunder? Did he not know the meaning of the legislation he was helping to pass? Is he willing to come now and say he made a mistake, and that the legislation they passed meant something else than he thought it did. Mr. George A. Kirkpatrick, afterwards lieutenant-governor of Ontario, was one of those who put that measure through. Also Dr. Sproule, and I never heard him say there was a mistake made. There was also the Hon. Mr. Macdougall, who then represented Halton. Will any one say that he was the kind of man who did not know what he was doing?


Alfred Henry Clarke: Does my hon. friend think that Mr. Kirkpatrick was a man who would do what my hon. friend thinks the Act meant?


David Henderson: I think he would do what he thought was right. The company asked for certain legislation and he gave it to them. Then we come to Mr. Thomas Farrow, now Judge Farrow, then member for the north riding 'of Huron.


Mr. M. Y. McLEAN.: Mr. Farrow was not a judge and not a lawyer. He is now postmaster in a village.


David Henderson: I stand corrected. I was misled by the similarity of names. Then we come to the Hon. Alexander Mackenzie. Where is the man on that side who will stand up and say that honest Sandy Mackenzie made a big blunder and did not know what he was doing?


Alfred Henry Clarke: Has the hon. gentleman not often said that Alexander Mackenzie was a great mistake and failure?


David Henderson: I undertake to say that the hon. gentleman never heard me make that statement. I may have thought it sometimes but not always. I do not say he always made mistakes by any means. In a simple matter like this, he would do what was right. Next we find Mr. John Haggart and Sir John Carling, and then we come to another gentleman whom I am sure no one on that side will accuse of wrong doing, the Hon. G. W. Ross. Did he make a blunder? He had not arrived at the age when he blundered, but later on in life, he did go astray. At that time, however, I am under the impression that the Liberals thought he was incapable of committing a blunder, whatever they may have thought later on. Then we come to John Charlton, a man of good judgment, a good business man and thoroughly veTsed in the English Mr. HENDERSON.
language. Did he make a blunder? And the Hon. Peter White, the late respected speaker of the House, in whom we all had confidence as a business man. He blundered too? Then we come to Dalton McCarthy, the late lamented uncle of the gentleman who, up in the committee room, told us that the legislation of 1879 was a mistake. I wonder what his uncle would think if he heard his nephew make a statement of that kind? I do not believe that he did make a mistake. He had too great a command of the English language not to be able to give exact expression to his ideas. Another was Mr. John Beverly Robinson. I never expected to be called on to review his judgments. I never expected to stand in the same class with him, much less to be put in court to declare that J. B. Robinson did not know how to frame an Act of Parliament.


Alfred Henry Clarke: Is that the chief justice?


David Henderson: It is the same name at any rate. He belonged to a family we have always held in respect in Ontario, as men of intelligence and abilty. Then we come to Mr. Hector Cameron, who.represented North Victoria and who was a high class lawyer. Then we have another gentleman I know well, a good lawyer, highly respected for his ability, and yet we are told . that he made a grievous blunder. His own son in the House the other night said a grievous wrong had been done.


Hugh Guthrie: If I be the one to whom the hon. gentleman refers, I would ask him to point out anything I said to that effect.
I said I had my own conclusion on the subject and did not express it.


David Henderson: I am speaking from memory.


Hugh Guthrie: Your memory is bad.


David Henderson: I hope the hon. gentleman will forgive me if I misquote him, but I have a distinct recollection that he made the statement that a grievous wrong had been done.


Hugh Guthrie: Read it again.


David Henderson: I have not now the time to look it up. But the hon. gentleman's father was one of those who did the wrong. If he admits that his father did not make a mistake, he ought to vote against this Bill. I would very much dislike to see him vote against his father. Now, we come to the Hon. Desire Girouard, who is on the Supreme Court bench today, are we, farmers and others from western Ontario and elsewhere, going to sit on his judgment?


Edward Walter Nesbitt: Were there only but lawyers in that House. Will the hon. gentleman hunt up a few farmers?


David Henderson: Yes, I will find a few. If you have a higher opinion of the farmers than you have of the lawyers, I shall endeavour to catch a few of them Mr. Julius Scriver was here then. He was a farmer and a very highly respected member of this House. I come to Joseph Alderic Ouimet, another lawyer, who afterwards became a judge in the province of Quebec. My hon. friend, may excuse me for not giving the names of farmers, because if I did he would tell me that the farmers were not capable of drafting Acts of parliament. It is for that reason I have selected men who are versed in the law, who would know what they were doing. Another of those men who made a blunder -and I would ask the Finance Minister to say whether this man did not know what he was doing-was Sir Wilfrid Laurier, now Prime Minister. He is one of those my hon. friend tells us made a blunder and who did not know what they were doing. He passed legislation he did not know the meaning of, and now we are to sit in judgment on him and declare that in 1879 he was guilty of passing into the statutes words which did not convey the meaning they were intended to convey. I believe that the right hon. gentleman was right then; and if he will only vote that he was I will be perfectly satisfied. There was another member of that parliament, in whom perhaps some hon. gentlemen would not have so much confidence, I refer to the hon. Sir Charles Tupper. He was one of those who made that mistake. Then there was Mr. Frank Killam, of Yarmouth. I am not sure but I think he was the late judge.


An hon. MEMBER.: No.


David Henderson: If not, it must have been his father. But I am told that in southern Nova Scotia all the Killams have a high reputation for ability and integrity. Then we come to another gentleman, I would not expect to make a mistake. I refer to the Rt. Hon. Sir John A. Macdonald. He was satisfied that this statute was correctly drafted.


William Stevens Fielding: Are you quoting from ' Hansard '?


David Henderson: I am quoting from the journals of the House.


William Stevens Fielding: You will not find his speech there.


David Henderson: I am not quoting his speech but I am giving my opinion of him as a legislator, capable of examining an Act of parliament and deciding whether it was in conformity with the petition and
proper legislation to pass. I do not feel disposed to sit in judgment on the actions of men like Sir John A. Macdonald or those others I have named. They were all men of high standing in whose judgment we ought to have confidence. I think I have fairly well established the fact that there was no mistake. Here is what the petition stated as presented in 1879 asking for an amendment of the Bill;
That the directors have heretofore allotted and divided among the assurers upon the participation scale seventy-five per cent of all the profits realized from the entire business of the company, and in view of the increases. business of the company it is deemed desirable that they should be empowered to increase the proportion of such profits which may be allotted to such assurers.
That is what they asked. Did not they get what they asked? They got it exactly; they asked for power to increase the allotment owing to the fact that the business has been increased, and, as they had more money, they were willing that the allotment to policy-holders should be increased from 75 per cent to 90 per cent, retaining not more than 10 per cent for themselves. For the twenty years previous to 1879, the capital of the company stood at $125,000. During that time, the dividends paid amounted to $690,625, an average of nearly 27 per cent. And the directors decided that they would be more liberal with the policy-holders, and, instead of taking 25 per cent for themselves, would take only 10 per cent, giving the policy-holders 90 per cent. Now, they say that all through this business the company credit the shareholders with the interest on capital and then divide the balance in the proportion of 90 to 10. I have here a statement of the Canada Life Assurance Company-I have similar statements for several years-showing the balance sheet as at December 31, 1899. If the company considers that the interest on capital was a liability, it ought to have put it in that statement and let the policy-holders know. But they did not do so. I, will read the liabilities, because I wish to get this on 'Hansard', for it shows that the company did not deal fairly with the policy-holders. If they ever charged the shareholders with this interest, they certainly kept the policyholders in the dark about it. I will undertake to say that no man ever went to an applicant for life insurance; and told him: The shareholders are first going to take the interest on their capital and then you will get 90 per cent of the balance. I never heard of a man who was canvassed in that way. On the contrary, the mode of canvass was to print leaflets and distribute them throughout the country-I have distributed many of them myself-in which appeared in large, black letters '90 per cent for the


David Henderson: morning at ten o'clock. I have no doubt the hon. member for North Essex knows all about it. Here is the affidavit on which that application was based-and I am only going to read one clause of it-here is what the applicant said, being sworn testimony along the line I was referring to:
I had always supposed until recently that the business of the Canada Life Assurance Company was conducted in accordance with the Acts of parliament and the duty of directors in pursuance thereof, and I never had any suspicion that the directors had been taking double dividends as alleged in the particulars of claim, and I never had any notice or knowledge of any such use, taking or appropriation of the money of the policyholders until after the investigation into the subject of life insurance before the Royal Commission.
There is an affidavit made by a business man, a policy-holder to the extent of $35,000, a man who did not know but that he was getting his fair share of the profits of that company, a man who was lulled asleep, as we would be told by accounts published by his c.ompany, not being told that his rights were taken away. No man would suspect for a moment, from that statement of liabilities, that the shareholders were getting their interest first on their capital and then dividing the balance. I have no hesitation in calling it, to use a mild term, decidedly misleading. Now we are told that because the profits have been illegally taken away from us in the past by the shareholders, the practice should continue, that because the policyholders had slept on their rights for 30 years they have no right to redress now. I have shown you that they could not help but sleep on their rights, because they did not know that their rights had been taken from them. And forsooth, we are told that because they have not instituted an action to recover their rights at this late day they have no right to make a demand.	,
Now let me say here and now that the policy-holders to-day are not asking for anything, they are asking for nothing but justice. They come to this parliament and ask for nothing except to be let alone. The policy-holders of the Canada Life Assurance Company are satisfied with their contracts. They entered into those contracts in good faith, they paid their premiums in order to secure something that, at their death, would benefit their wives and children. They say:	Let us alone,
we have made provision for our dependent ones, and we want you to let us alone, and when that policy matures pay the money; we are not troubling you. The policy-holders I believe as a rule think, X know X do, thst th6 C8.ns.d3. Xiifo Assurance Company is able in every respect

financially to pay every claim that will come against it. I believe the insurance reserve they have put aside would be sufficient, under proper management, to meet every claim that would ever be brought against the Canada Life Assurance Company, and I as a policy-holder, and other policy-holders, says :	' Let us
alone. We do not want to be troubled by you, we do not want you to come to parliament and get an Act declaring that the charter under which we made our contract means something different from what it says.' That is all they are asking. We say that these assurances, effected largely for the benefit of women and children, women and children who cannot appear here to defend their rights, women as well as men who were refused the right to appear before the Banking and Commerce Committee to state their grievance. Is it fair to take the bread, to take the widow's mite away simply because it is going to benefit a millionare? I cannot imagine how we can pass legislation of that kind. I respect the widow's mite. It may be small, but yet if it be only $100, if it be only $200, it belongs to her. Don't take it away. The other man has got an abundance, and far more than an abundance, more than he can ever make use of. Let the widow and the orphan have their little pittance, without trying to build up millionaires, making one man enormously wealthy in Canada at the expense of so many others.
I have said what I purposed saying about profits being wrongfully taken. It is alleged that because we had not put in our claim before to-day that we are debarred now. I think I have given you good reasons. I have given you the sworn testimony of one policy-holder, a large policy-holder, that until the Boyal Commission sat, and until this judgment, he was not aware of the fact that he was not getting his rights. After that he took proceedings, he has instituted an action which is pending in the court to-day, as other actions are, and* here we are asked to pass an Act of parliament to put that man out of court, to declare that his action cannot succeed. If we do that are we fit men to sit in judgment on Wilfrid Laurier's actipn in 1879, on Donald Guthrie's action in 1879, on Sir John Macdonald's action in 1879, on John Beverly Robinson's action in 1879? Are we fit men to review their opinions if we are capable of passing an Act of parliament to take away vested rights from helpless women and children in order to make one great millionaire in this country?
Another point I want to refer to, because I have no doubt that the argument will be advanced that other companies do this. I grant there may be a great deal of truth 191
in that. Other life insurance companies do just what the Canada Life has been wrongfully doing. But the other companies were doing what they have a right to do.
I challenge any hon. member to furnish me with the name of an insurance company organized as the Canada Life has been. At any rate if there is one I do not know it). I have searched among the records of Canadian insurance companies, of American insurance companies; I have inquired as to British insurance companies. I haye gone to the head of the insurance department of Canada, and the evidence I get is that there is not another company doing business in Canada who has a charter similar to that of the Canada Life, not another one that compels the company to divide all the profits arising from the entire business of the company.


Alfred Henry Clarke: Not another company with the same system of non-participating policies?


David Henderson: I do not know. It
makes no difference to me, because it was a voluntary act on the Lpart of the company to have their charter drawn in that way. They made the charter very attractive, giving policy-holders 90 per cent of all profits arising from the entire business of the company, no matter where it came from, no matter whether it came from interest or from profits on non-participating policies, it made no difference, because the policy-holders' contract was for 90 per cent on everything, and it is too late _ to say now that the Canada Life is giving something that no other company is giving. It has no bearing with me. Those who took out their policies since 1879 took them out under the charter of 1879, which was emphatic, which was plain, the purest Queen's English, no mistake in the words. Those men paid their money and are paying it now, they made this provision for their dependent ones, for their wives and children whom they leave after them, and I say it is no difference whether these profits were derived from interest, from nonparticipating policies or where they came from, the Canada Life Assurance Company contracted to give 90 per cent of these profits to every man insured on the participating plan. Why not make them fulfil their contract? I am not asking the Canada Life Assurance Company for anything except that they let us alone. Do not take away from us what we have. Leave the legislation of 1879 as it is and, as far as I am personally concerned-I do not speak for others I shall be satisfied. But, do not rob me of my rights. I am not accusing members of parliament. It is the company that come here and ask that our rights be taken



away. Do not take away what belongs to us. If you want to establish a grievance take away what we have as a right. Then, you will create a grievance. But, if you leave us alone the probability is that the majority of the policy-holders would leave the company alone even although they did make a mistake. If you take away from the policy-holders what rightfully and lawfully belongs to them and for which they have paid, you will create a great many grievances.
At one o'clock, committee took recess.
Committee resumed at three o'clock.


David Henderson: In the few minutes allotted to me I propose to answer the challenge to name others than lawyers who adopted the legislation of 1879. I would name Messrs. Timothy Coughlin of Middlesex, William Elliott of Peel, William E. Hessan of Perth, James Trow of South Perth, William C. Little of Simcoe, Robert Hay of Toronto, Hugo Krantz of Berlin, Thomas Bain, our late Speaker, Joseph Rymal, Thomas Christie, Francois Bechard, George B. Baker, now Senator Baker, Alonzo Wright, Sir Leonard Tilley, John Costigan, Dr. Shultz, and Donald Alexander Smith, now Lord Strathcona. These are the men who agreed to that legislation. They knew what it meant when they passed it and why should we sit in judgment on those great men and tell them they made a mistake and did not know what they were doing? As to the interpretation of the legislation then passed, may I quote the legal opinion of Sir Robert B. Findlay, Attorney General of England, as to the rights of policy-holders which we are now asked to declare should be taken away from them? In giving his opinion Sir Robert Findlay said:
1.	The policy-holders on the participation scale have koen since 1879 and are now on any division of profits entitled to at least 90 per cent of all the profits realized by the entire business of the company.
2.	The payments of dividends to the shareholders since 1879 in excess of ten per cent of the profits from the business of the company have been ultra vires payments.
3.	There is no ground for the contention that the shareholders are entitled to interest on capital and also to ten per cent of the profits or to a sufficient part thereof to make up $80,000 a year to be paid to them as dividends, but it is the duty of the directors to make up the accounts of all the profits realized from the entire business of the company, including the interest which may arise from the investment of the money paid in on account of the capital stock of the company and to limit the dividends to shareholders to ten per cent thereof.
And I may say here what every hon. member in this House knows that the highest legal authority in this House, the Min-Mr. HENDERSON.
ister of Justice, endorses that statement to the full. I contend then that we need not hesitate to dispose of this question, fearing that we may be wrong as to the interpretation of the Act of 1879. A judgment of the Privy Council of England could not be more convincing than the opinions that have been given to us.
What is the object of the legislation? The directors of the company themselves had come to the conclusion that they had not been interpreting the Act properly and that they had been taking profits wrongfully. The evidence of that is that they now ask for legislation to condone the offence. I need not argue that point further, it is admitted by the directors that they have been doing what they had no right to do. The proof of it is that they come here for legislation asking that the offence be condoned. In other words they ask us to state in this House, to use the well known words which I believe are taken from Holy Writ : ' Let him that is unjust be unjust still.' They want to continue doing -what they have done wrongfully for the last thirty years, and they ask us to condone their past offence and to give them the right to continue it for the future.
Here is the serious part of this question. A policy-holder who went into the Canada Life Assurance Company probably only two years ago in order to keep up his policy will have to continue paying his premium and if this Bill passes he will pay his premium knowing that the directors are going to take out of that yearly premium a sum of money which they have no right to take. Do you mean to tell me that is not a grievance? Fancy the feelings oi a policy-holder going to the agent to pay his premium knowing that a part of the money he is paying in is not to carry his policy, but to go into the pocket of some rich man who is not entitled to it. If we pass this Bill we simply perpetuate a grievance until every man who is now insured in the Canada Life Assurance Company passes off the scene, which may not be for forty or fifty years. As I said, I intended to discharge a duty which I feel incumbent on me; I feel that I should not retain my seat without making the strongest possible protest against the legislation now proposed. I have made that protest and the matter is now in the hands of the House to deal with.
I wash my hands clean of any attempt to take away from the widows and orphans of those assured in the Canada Life Assur-ence Company anything that properly belongs to them, that their husbands and fathers have paid for in perfect good faith, simply to hand it over to an association of wealthy men.


Mr. CYRIAS ROY (Montmagny).: Translation). Mr. Speaker, before the discussion on this bill is carried any further.

I wish to have certain explanations made, not only for myself personally but for my constituents as well, many of whom are holders of policies in this Company. I did oppose all further progress with this Bill from the very start, and this was at the first meeting of the Select Committee on Standing Orders. This request was granted by the committee. Then the Bill came before the House and a motion was made to refer the Bill back to the Committee on Banking and Commerce. I shall here give a word of explanation. I consider for my part that they new notices having been given, the policy-holders were sufficiently notified that this Bill was before the House and that its object was to ascertain the proper powers vested in the company as between shareholders and policy-holders. That is the reason why I did not see fit to vote in favour of the further reference of the Bill to the Committee on Banking.
I consider in fact that the proper and legal proceedings to secure the discussion '*of a Bill is not by roundabout ways, but by the regular course before the House, and it seemed to me that the sending back again of this legislation before the Banking Committee was tantamount to the six month's hoist. Now, I must confess that I need information, first to satisfy the policy-holders in my county, who have requested me particularly to represent their views in this discussion before the House, and second for my own satisfaction. These explanations I hope willl undoubtedly be given me by the hon. member who is called upon to answer the objections raised by the hon. gentleman who has just sat down (Mr. Henderson). I am forced to say right now that in the event of such explanation failing to enlighten me, I shall vote against this Bill. I am a new member of this House and little conversant with its rules. True I am a lawyer, but I have been out of practice for nine years now, and I am acting as prothonotary of the Superior Court, in my district. In my official capacity, I am held down only to the recording of the decisions and opinions which may be held by the different solicitors before the Court. 1 am forced to admit that I am not sufficiently posted in order to give an accurate decision either for myself or for my constituents on the matter under discussion, until I get certain explanations on the legal aspect of this bill. I might be told that I did not take the trouble to seek the necessary information, but I will answer that a member of this House who has much patronage to look after, and many inquiries from his electors cannot possibly get acquainted with every document which is laid before the House.
The first information I want to have is this; Parliament is called upon to declare 191 i
that certain provisions of a Bill passed in 1879 are not those that were intended to be passed. In the second place, I want to know if subsequent to the law of 1879, that is in 1889, if I mistake not, under an amendment made to the charter of the company, saying that six policy-holders were entitled to sit as directors, I want to know, I say, if in the petition of this company which is now before the House, these six policyholders were consulted; if the request of the shareholders is fair, as alleged, or if the shareholders have had the co-operation of the directors representing the policy-holders who are called upon by law to sit on the board? Now, Mr. Speaker, one more question. This point has already been raised, but I would require for my personal satisfaction that more light be thrown on the subject, so that I might give equal justice both to the promoters of this Bill and to the policy-holders. I see by the preamble of the legislation of 1879, the object of which was to slightly alter the original charter granted to the Canada Life as far back as 1849.
That the directors have so far allotted and divided among the persons assured upon the participation scale 75 per cent of all the profits realized from the entire business of the company, and that in view of the increasing business of the company, it is, or may he desirable to vary the relative proportions in which such profits should be allotted and divided as between the shareholders and such persons assured, and in paragraph 1st of that statute of 1879, it is laid down in accordance with the preamble that the directors are hereby authorized in their discretion to vary or to amend the relative proportions" in which the profits realized from the entire business of the company were heretofore allotted as between the policy-holders under the allotment system, and the shareholders.
I particularly request your attention to the following proviso, Mr. Speaker and gentlemen of the committee, because it seems to me to have a very important bearing:
Provided always that the proportion of such profits allotted to such assured shall not be less than 90 per cent thereof, and the profit to the shareholders shall not exceed 10 per on t thereof.
It is thus evident, at least in my opinion, that up to 1879, the distribution of the profits of the company was made in such a way as to ensure 25 per cent of them to the shareholders and 75 per cent_ to the policy-holders, or assured. But in 1879, under the legislation the preamble of which I have just quoted, the directors of this company were authorized to increase this proportion in favour of the policy-holders, since the following proviso is there stated :
Provide always that the proportion of such profits allotted to such assured shall not be less than 90 per cent thereof, and the profit to the shareholders shall not exceed 10 per cent thereof.

For my part and unless satisfactory explanations to the contrary are given me, I hold that all the profits realized on the entire business of the company mean not only the profits accrued from the premiums of the policy-holders, but also the interest accrued on the capital paid up by the shareholders as well. That is what was being done prior to 1879 as is indicated by the preamble which I just read. It was alleged that the interest upon the capital paid up by the shareholders in the way of stock should be first taken before the rest was apportioned as annual profits. So far I have heard only the explanations given by the hon. Minister of Justice (Hon. Mr. Aylesworth), but I confess that I did not quite understand him, on account of my insufficient knowledge of the English language. I wish he would tell us under his responsibility as Minister of Justice whether or not the legislation of 1879 can be so amended by this Bill as not to interfere in any way with the rights of the policyholders.
There is, as I stated a moment ago, a point of law which arises out of this matter, and it is exactly the point on which I want some information. I am not an expert, and I want to be enlightened. According to me, the profits include everything, unless I am proved the contrary. If I understand aright, the law of 1879 included all profits realized on the entire business of the company, and these profits meant not only those that were realized on the premiums of the policyholders, but also the interest upon the capital itself paid up by the shareholders.
It is stated further that the business of the company having increased, the object of this Bill is to secure an amendment in favour of the policy-holders, but only those who are entitled to the accumulated profits under their policy are there concerned. Under the same statute of ' 1879, the policyholders are entitled to 90 per cent of the profits. That step was unquestionably taken to increase, if possible, the number of risks. It is stated that the business of the company has increased very largely, and that it bas piled up great profits from 1849 to 1879. Thus, in order to increase the number of policy-holders, it was decided to grant a larger proportion of the profits, that is from 75 to 90 per cent to the policyholders. _ Now, I would also like to have the opinion of an expert on the following question?
By section 92 of the British North America Act, provincial legislatures have the sole right to legislate on property and civil rights of the provinces. Well, I consider that since 1879, all those who got insured in this company-because everybody is supposed to know the law, and these policyholders are supposed to have taken cognizance of this amendment of 1879, saying that on all the profits realized by the com-Mr. ROY.
pany the policy-holders will share in the proportion of 90 per cent-I consider, I repeat, that according to section 92 of the British North America Act upon civil rights of individuals to which I have already alluded, that there is some doubt as to the legality of the request of the company in this Bill, and if it is adopted, would it not be possible for a policyholder tc bring this Bill before the courts in order to test its constitutionality.
I want to be informed before giving my vote, because section 92 says that provincial legislatures have the sole right to legislate upon civil rights. Since 1879 all the policyholders come under the amendment made in 1879 to the charter. It is a contract between them and the company, and under the terms of this contract it seems that this House could not decide that these parties have not the right to claim before a court the profits stipulated by the charter.
I am asking this information because I would like as far as possible to do justice to my constituents who have asked me to protect their rights, and because I would like equally to be fair to the promoters of the Bill. I understand very well that when certain parties come before this House to claim certain rights, it is because they believe that they are entitled to them. But, it very often happens that unnecessary and totally irrelevant objections to these requests are made in order to refuse them. This is what has been done in the recent discussion upon the Bill of the honourable member for Thunder Bay and Rainy River (Mr. Conmee). Great many amendments have been moved to that Bill; all the suggestions made by the gentlemen opposite were against the Bill; provincial rights have been mentioned; also the right of expropriation, and all sorts of things were discussed, except the Bill itself. I must say that the promoter of this Bill has accepted that treatment very patiently, in order to shorten as far as possible the long debates which have taken place, and which I, for one, think could have been very well suppressed All these objections, I repeat, had no sense. If the promoter of the Bill could not have acquired the right he was seeking, he was then in the position of being unable to exercise the rights which would have been granted to him by this parliament.
I am making these remarks simply in order to show to this House that I desire to give justice, not only to the policyholders, but also to the promoters of the Bill.
In principle, I must say that whenever somebody asks to this House some rights, and if the facts established before us justify the granting of them, I am ready to grant the request.
I would like, therefore, to have some explanations, and I will guide myself upon

them before giving my vote. But, if I am allowed, I will make a suggestion, not a motion, because I am too young a member for that. As I was saying a few minutes ago, I have seen in the statute, posterior to 1879, a clause giving to six policyholders the right to form a board of directors. I would like to know if these six directors have signed the request to bring this Bill before this House, in order to have us to declare something different to what was stated in the law of 1879. I have another suggestion to make. As some differences of opinion have existed between the shareholders and the policyholders of the_ company-I don't want to delay the passing of this Bill and if my suggestion is not granted I will submit myself-would it not be right tc let the board of directors, which is composed partly of shareholders and partly of policyholders, to discuss this question between themslves, in order to settle their difficulties before coming here? It seems to me that they could come to an agreement so that this House should not be obliged to take a decision which would be detrimental to the one or the others.
Therefore I suggest that this Bill should be read only in six months from this, inorder to give the directors and policyholders during the intervening months time to meet together and discuss the matter between themselves, in order to arrive at some agreement protecting the interests of all.
It has been said if this Bill was not passed at this session, the delay might bring the complete destruction of the company. If I was sure of that 1 would vote immediately in favour of the Bill, but I don't believe it.
The opponents of this Bill have contended that the policyholders have not been notified. For my part, I believe that the facts are >all to the contrary, but, nevertheless, I won't contradict. It seems to me that a legal and reasonable way of disposing of this Bill according to justice would be to postpone it to six months in ordeT to give an opportunity to the directors, both shareholders and policyholders, to discuss the matter between themselves, and to come to an equitable agreement for every one of them.
Next session we will be in better position to give a vote upon the question, and we will be discharged of heavy responsibility when we will be sure of safeguarding the interests of our constituents without doing any wrong to anybody. For my part, it is only a suggestion that I am making, and it is to get some enlightenment before voting on this question, that I have spoken upon this Bill.


The Bight Hon.   S@: (Translation.) Mr. Chairman, I may answer to one of the
questions of my hon. friend, member for Montmagny (Mr. Roy). The object of this legislation is to modify or rectify the amendment to the charter made in 1879. My hon. friend has stated very rightly, that the effect of this law was to divide the profits between the shareholders and policyholders in the following proportion: 25 per cent to shareholders and 75 per cent to policyholders. In putting this law into operation the board of directors of the company have always granted to the shareholders of the company the interest upon the capital itself of the company, though this capital, it is true, was very small, proportionately to the moneys contributed by the policyholders.
Mr. Ramsay, who was general manager at that time, a very competent man in these matters, always thought that the right course to pursue was to allot this interest upon the capital to the shareholders, before dividing the annual profits, the balance of which was divided, as I have said, in the proportion of 25 per cent to shareholders, and 75 per cent to policyholders. It is only after the interest had been paid to the shareholders on the capital invested that the division to which I have alluded is made.
The object of this Bill is to declare that the shareholders are entitled to this interest on their capital before making the distribution of the profits between the shareholders and the policyholders. This is the object of this Bill. There are some doubts and it is asked if under the law of 1879, the practice which has been followed by the company since has always been legal. It is in order to ratify this practice that this Bill has been introduced.


George Eulas Foster: I desire to state in a few words the position I take on this Bill. I am very strongly opposed to ex post facto legislation. It requires in my mind a very strong case to justify a parliament legislating, after a period of ten or fifteen or twenty years, in a manner which takes away from tens of thousands of those who have made contracts with the company rights which under the law under which they made those contracts they possess. That is my first objection. An individual business man has to pay for the mistakes he makes, and it is a question in my mind whether it is not proper that a company should pay for its mistakes, instead of in order to remedy those mistakes trying to have ex parte legislation, to the exclusion of-' one party to the contract, and that party twenty thousand times multiplied, which does not assent to, has no voice in and can make no representations with regard to it. That is the case in this instance. If it had been proved to my satisfaction that there had been a per-

feet agreement between those who were policy-holders and those who were shareholders, resulting in the clause becoming law which did become law, then so far as all those policy-holders were concerned, they had no grievance. But that was not proved to the satisfaction of myself and a good many other members of the committee. But even if it had been absolutely proved, you have another party in the premises. You have the tens of thousands who have made contracts with this company from that time, who knew nothing of that alleged agreement, but who made their contracts under the law as it is to-day; and that very large class of policy-holders have been absolutely uncommunicated with in so far as to have been given an opportunity to signify their attitude towards this Bill. It is hard on the company if such was the agreement, and if by a mistake in legislation that agreement has not been put before those with whom the company has since made contracts. But companies as well as individuals have to bear the brunt of their own mistakes, and it is a great question with me whether, in passing legislation of this kind, we are not going far beyond what we as a legislature ought to do; and I think the promoters of this Bill would be well advised if they acknowledged consent to put this Bill over to another session, Seeing that the original notice was insufficient, and that although the subsequent notice was sufficient, the parties concerned have not had an opportunity to come before the ultimate legislative body and press their views upon it. It has been physically impossible for them to present their views in any shape or form. It may be that out of the multitude of policy-holders, there would not have been a great many to come forward, but you would at least have conformed to the forms of justice. As it is, by no combination of a few or by no knowledge possessed by the many has it been possible for these to get together and present their side of the case. Therefore, I say, though it may be a hardship for the shareholders of the company, yet if they have endured for all these years, they can surely endure for another year. I make a plea for the holding over of this Bill until another session in order that at least we might not contravene that explicit principle of parliament that before legislation is finally passed, all parties interested therein shall have the recognized notice, and the opportunities consequent on that notice for the presentation of their views. I know that the statement is made, but it is hardly an argument, that the same principle for the division of profits is followed in all the other insurance companies. I acknowledge that; but the point I make is that here was a plain article of the law under Mr. FOSTER.
which numberless contracts have been made, and therefore it seems wrong for us to pass legislation in the interest of the few to the absolute and almost necessary exclusion of the many, owing to the short notice that has been given.


Alfred Henry Clarke: My hon. friend from North Toronto evidently was not here the other night when the House very fully discussed the question of allowing this Bill to go over for another year, and decided by a very emphatic vote that the Bill should proceed. My hon. friend admits as every other person does, that if the position which is being taken by the opponents of the Canada Life Company be maintained, a very great injustice and hardship will be committed upon the shareholders of the company. Has it occurred to my hon. friend that, however inconvenient it might be to them, much more inconvenient would it be to the policy-holders, if this matter were not dealt with before the next distribution of profits.


George Eulas Foster: When does that come?


Alfred Henry Clarke: This year. What I pointed out the other night was that the directors are not bound to allot profits. That point was fully discussed in the Ontario courts, in a case with the Aetna Life Insurance Company some years ago. That case was decided in favour of the company in the first court and went to appeal; and in a carefully prepared judgment, the Court of Appeals decided that this question of profits is ji vague one, that the right of the policy-holder to profits is vague, and that in oTder to work out the purposes for which that right is given, the directors must have a free hand with regard to it. The policyholder in that case was Mr. John Bain, a prominent lawyer in Toronto and afterwards partner of Mr. Wm. Laidlaw, who is giving so much opposition to the Canada Life Company at present. The matter was discussed very fully. The Hon. Chancellor Boyd, with two other members of the court, gave the judgment, and according to that judgment:
The contract of insurance is of a vague character as to the division of profits, and for this reason such a construction must be given it as will promote and not frustrate the objects of the undertaking.
That is precisely what I have said. If what is desired by the opponents of this BilLbe accomplished, the very objects of the company would be frustrated instead of promoted. The very right of the policyholder to profits is bound up in the1 prosperity of the company. If the company in any way be prevented from carrying on a prosperous business, true the shareholders may not get as large dividends but the policy-holders will not get anything. To that extent the two are partners and their

interests identical. Because i! the shareholders prosper, to the same extent must the policy-holders benefit as regards the receipt of profits. But coming down to the policy itself, if there be anything in the contract between a policy-holder and the company, there is nothing whatever in the legislation proposed to prevent that contract being carried out. The present Bill does not seek in any way to interfere with the contract which the policy-holders have seen fit to enter into. If hon. gentlemen will look at the policy-and I have looked at mine., and I have two, to make certain- they will find that the company does not agree to pay profits to the policy-holders. It is not a mutual but a joint stock company. What the company say, however, is that if they do allot profits, as they have been doing every five years, then the proportions are established in which such profits are to be'allotted, namely 90 per cent to the policy-holders and 10 per cent to the shareholders.


Edward Arthur Lancaster: That is settled by this Act.


Alfred Henry Clarke: No, all that it is intended to be done by this Bill is to confirm the construction which has been placed on the Act of 1879 by the ablest men in Canada, by judges, by astute businessmen, by every one who has had anything to do with it. It seems to me that insurance is something like the law of merchants. It has grown up, it is the outcome of custom, and has been framed by insurance men. Take the law on promissory notes, that grew up in time out of the customs of those who had to do with these notes, and was established by the general custom of business in the matter. So with insurance, you will not find an insurance man in all Canada who will say that the construction put by the Canada Life on the Act of 1879 is not the proper one. That is Jhe understanding of ali insurance men, and there is a good deal of support for it. If you will look at the Act of 1849, you will see that it is not part of the insurance business to invest the capital stock of any insurance company for the benefit of the policy-holders. The business of an insurance .company is to insure people and get profits from insuring them and not to get profits from the investing of their own money. If that were the object, those investing in insurance companies would instead put their money into loan companies. But we are dealing with an insurance business, and when an insurance company says it will distribute the profits of its business to its [policy-holders, it would be quite foreign to the general understanding and the practice of all companies doing insurance business in Canada that it should include in those profits interest on the investment of capital stock.
My hon. friend from Halton (Mr. Henderson) made a strange argument this morning. He said that the men who framed this Act in 1879 were competent men and ought to have known what they were doing. Well, everybody knows that there are imperfections in the English as in every other language, and the same words often convey opposite meanings to different people. But it is rather singular that Mr. Laidlaw should have crossed the ocean to get the opinion of a solicitor in England, not familiar with insurance practice in Canada. Surely we have men in this country, accustomed to our courts and versed in our jurisprudence, who could give just as good an opinion regarding the construction of a statute enacted by the Dominion parliament. Hon. members must not think that there is only one side to this matter. The Canada Life Company has been advised by one of the most eminent lawyers in Canada that, in his judgment, considering the practice of insurance companies, the construction which the directors have put on the Act of 1879 is quite correct.


George Eulas Foster: Then why ask for this legislation?


Alfred Henry Clarke: The question put by my hon. friend is most pertinent. If it had not been fox the fact that a prominent lawyer in England had raised doubts, there -would be no necessity for this legislation at all. It was not until the doubts had been raised and an attempt made to do away with the practice accepted, not by shareholders alone, but by policy-holders as well, for sixty years since 1847 and for thirty years under the Act of 1879, that the company deemed it necessary to ask for this legislation; and in so doing they are taking a reasonable course, not only in the interests of the shareholders, but of the policy-holders as well. One thing is certain, and that is that, under the construction which the company has put on the Act of 1879, it has gone on prospering and the policy-holders have derived great benefit. What would happen if those who are opposed to this measure should succeed? In my judgment that would ruin the company, and instead of the policy-holders getting ample profits-because the profits given by the Canada Life will compare favourably with those distributed by any other company, mutual or otherwise; I have compared my policy with those of other companies and find I have got better profits even in later years when the profits were not so great-their possibilities of getting profits would disappear. Why is it that the mutual companies are not a success? Who is there in this House who, if he wanted to insure his life, would think of going into a mutual company? In those companies all the profits are divided, but the policy-holders do not get any, and frequently do not get the amounts for which they

were insured. How many sad experiences have there not been of people who have gone into mutual companies and not only have got no profit, but lost all the moneys they paid into them. If you want to have a successful company you must have able business men at its head, and you will not get business men of ability to invest their capital in a business unless they see some possibility of getting adequate returns compared with the hazardous nature of the undertaking. In 1847 the business of insurance companies was considered very hazardous. People were afraid to insure their lives because at that time many thought that life insurance meant sudden death. Since then the business has become profitable, but that is due to the character and ability and management of the men engaged in it. They put the business on such a basis that, with the safeguards thrown around it, any man who puts his money into an insurance policy is assured that whether he dies in ten years or fifty his heirs will get the amount of his policy.
My hon. friend from Halton has talked about the character of the men in parliament in those days, and rpentioned specially the names of Bruce, Burton and Kirkpatrick. But I do not think he quite appreciated the stigma he was placing on their characters by the speech he made. What he says is that the interpretation which has been put on the Act of 1879 by Mr. Laid-law is the interpretation which was intended by the men who were in parliament at that day. He says further that it was the interpretation which was intended by Mr. Bruce, their solicitor at that time, and the interpretation which was; intended by the directors of the Canada Life Assurance Company who applied for that legislation and who knew exactly what they meant. Suppose we accept that view of the caise. According to that, then, the directors of that day never intended, when they asked parliament to enact that Bill of 1879, to pay themselves and their fellow shareholders! interest on the capital stock before distri-1 buting profits. If that be so, then I think they are the most infamous set of men that Canada could produce. If you have a set of men coming to this parliament, misleading parliament, saying to parliament that they are not going to do a certain set of things, and, the very next year, turn around and do those very things, no words of reprobation are sufficient to stamp those menl as most perfidious wretches. That is what was intended by the Canada Life directors, we are told, yet ever since that time they have violated that intention and have kept on declaring the profits in a way parliament did not authorize. Now, who are the men who are such villains ?-and they are


Alfred Henry Clarke: villains if they have done such a thing.
I have a list of the directors of 1879 and a list of the directors who, in 1880, declared profits without giving the policy-holders the interest on invested capital, but first taking the interest on capital and then computing the profits for the policy-holders. The first is Mr. F. Wolferstan Thomas, of Montreal. Then there is Canon Innes, of London, D. Mclnnes, Hamilton, George Hague, Montreal, F. W. Gates, Hamilton, Mr. Justice Burton - who was at the time a judge of the Court of Appeal, and afterwards became Chief Justice of the province of Ontario,-Col. Gzowski, Toronto; N. Merritt, Niagara; Thomas W. Ritchie, Montreal; John Stuart, Dennie Moore, and Wm. Hendrie, of Hamilton;- George A. Kirkpatrick, M.'P., of Kingston,-my hon. friend (Mr. Henderson) lauded him as a most exemplary character, one who would do nothing wrong; yet he is one of the men who perpetrated this great fraud upon the policy-holders according to my hon. friend himself-A. G. Ramsay-whom also my hon. friend lauded and who -also was one of those who took part in this transaction; James A. Harding, St. John, N. B.; J. Osborne, Hamilton, then another Lieutenant Governor, Sir Alexander Campbell-he was another of these villains,-Mr. A. Allan of Montreal, one of the most prominent business men of Canada, and Mr. Thomas Swin-yard, of Hamilton. These were the men who were responsible. This was not done by Mr. Cox, who is now being made the target of attack; he had nothing to do with the directorate of the company in those days; he did not institute the practice now complained of, but followed the practice as he found it and which every person believed to be correct practice. It seems to -me that when hon. gentlemen will rise here and say that these men, not believing they were doing right, did exactly the contrary of what they led parliament to believe they were going to do, they are putting a stamp upon the reputation of prominent men in this country which is not deserved. When we have a Chief Justice of the ability and standing of Chief Justice Burton, who was connected with the company up to the time of his death, this is a pretty good guarantee to the policy-holders that the directors acted in what they thought the best interest of the policy-holders and in accordance with the claims of justice. My hon. friend from Montmagny (Mr. Cyrias Roy) asked a very proper question, and that was, as to the attitude of the policy-holders' directors. For, in 1899, by Act of this parliament, the directorate was changed to some extent, so that six of the directors were appointed by the policy-holders along with nine to represent the shareholders. It is

true that, under the Act, the policy-holders' directors were not to vote on the question of distribution of profits. The company would cease to be a joint stock company if that were done. Parliament, at that time, thought that this was good representation of the policy-holders on the board, and did not see fit to say that the policy-holders' directors should have a right to vote on a matter which affects the distribution of profits. But these men have -other duties to perform. The policy-holders have had their representation on the board ever since 1900. Do we hear any complaint from them? They are the people the policy-holders sent there to represent their interests, and they have acquiesced in every respect, not only in the division of profits made ever since that time, but also, I am informed, in the application to this parliament to have this matter set right in order to prevent costly and, perhaps, never-ending litigation and to preserve the standing of the company. Are these competent men? Who ' are the men appointed to represent the policyholders? I believe the Act was passed in 1899, and I have here a list -of the policyholders' directors in 1900. The first was Mr. Alexander Bruce, who has been referred to in this debate. Besides there were Hon. Donald Maclnnes, Sir Georce W. Burton, William Gibson, M. P., Very Rev. G. M. Innes, of London, and J. W. Plavelle. These men, one would think, ought to be able to protect those whom they represented. They were men of large business experience, large professional experience, and among them was a member of ttie clergy, who, we might expect, if any fraud was intended, would be able to protect those who elected him to the board. This list is changed somewhat. Mr. Maclnnes died, and his place was filled by the election of Mr. Charles Chaput, of Montreal, who, I understand, is a very prominent and astute business man of that city. These men and their successors have been meeting year after year on the board of directors, they have known exactly what is going on, they are interested in the prosperity and success of this company, their interest and duty was to represent faithfully those who elected them. And I submit that the very strongest evidence of the good faith and beneficent character of the legislation being asked for is that these men, appointed for the purpose of representing the policyholders, have approved the manner of distributing the profits which has been followed, and, at a meeting in which Mr. Chaput took part, decided that it was in the interests of all parties that this matter should be set right and no further difficulty raised in connection with it.
Now, what are the tactics against this legislation? A writ was issued. What
would be the effect of that writ if granted? It is brought against the Canada Life Assurance Company, not against the shareholders who have received the profits which some say have been unfairly diverted to them. The action is brought against the company alone. If judgment were given against the company, out of whom will the payment come? Not the men who are dead, the men whose stock has been disposed of, but out of the very fund which the policyholders want for the distribution of profits. Take away by this action the profits which the policy-holders are entitled to, and the policy-holders cannot get those profits. I submit that the policy-holders to-day are entitled to the very moneys which this action is brought to take away from them. Mr. Laidlaw has been discussing this matter for the last three or four years-it is no new matter for him.
My hon. friend from Halton read a paragraph from his affidavit from which he drew the inference that he had been for a long time ignorant of what the profits were. I have his own letter written before that time when he was discussing this question with the president of the company. Go back to the year 1902, and you will find on the files in the records of the government a discussion of this very matter by Mr. Bruce. My hon. friend gives him a good reputation as a man who would do no wrong, and who did not intend to do wrong; yet he endeavoured to say that, although he allowed Mr. McCarthy, the solicitor of the company, to appear before the Banking and Commerce Committee and show what was the meaning of those men, Mr. Bruce being the man who framed the Bill of 1879, who sat there in the Banking and Commerce Committee, ready to corroborate it, yet my hon. friend says although Mr. Bruce was there he would not venture to get up and corroborate it. Is that complimentary to Mr. Bruce, the man who was promoting this Bill? Yet he says he has allowed all this hypocrisy to go on, first of all knowing what the intention of the Act was, the next year taking part in an, act which was one of treachery to the policy-holders. Yet he says that man sat still in the committee because he knew he could not get up and say that any mistake had been made, or that the intention was other than it was claimed to be. Yet I find that Mr. Bruce wrote a letter in the year 1902, when this matter was being agitated, and he explained it in precisely the same way it is being explained here. In 1902 he wrote a letter to the actuary. It is very long, and if any hon. gentleman cares to read it I will send it over to him. What he says in substance is that the reason for the Act of 1879 was this, that up to that time the directors

were not authorized to pay the participating policy-holders any part of the profits except those arising from participating policies. Now, the directors, notwithstanding that, had been going on for years and paying them, not only profits from participating policies, but profits from nonparticipating policies. That was open to objection, because the Act did not authorize it. Therefore, the intention in coming here, as Mr. Bruce points out, and what is apparent from reading the Act of 1879 itself, is to authorize the directors to pay profits to the participating policy-holders from both branches of the business, that is to say from the participating business and also from the non-participating business, and so anxious was he to show that, that he uses the very words that are now held to mean something further than was intended. What he says is that the entire assurance business paid profits, meaning, as he points out in the paragraph, all the business, that is to say, profits from the participating and also profits from the non-participating business; he makes it clear, and points out what the recital in the Act of 1879 shows plainly, that the profits which were to be divided thereafter were the profits which had theretofore been divided. The proportion up to that time time did not include interest on the investment of the capital stock, and it was never pretended at that time that any profits were to be divided except those that had theretofore been divided. Mr. Robertson, of Hamilton, in introducing the Bill, merely said that it was intended to alter the proportion in which the profits were to be divided. The proportion up to that time had been 75 to 25, after that time they were to be 90 to 10, and these profits which were set apart for division previously, have been thus divided ever since that time. Now it is said that Mr. Ramsay never said that. We are agreed in one thing at any rate, that Mr. Ramsay is a gentleman on whose word we can rely. Here is what he says in his certificate:
1.	I came to Hamilton, Canada, in the year 1859 in the capacity of manager of the Canada Life Assurance Co., and entered on that duty in that year and continued in that office until the year 1874, when I was elected a director of the company and was then appointed managing director and continued to fill that position until December, 1899. I was elected as president of the company in the year 1875, and filled that office continuously up to December, 1899, when I resigned my position as a director and thereupon ceased to be president.
I had thus been connected with the company continuously from August, 1859, to December, 1899, in these positions. [DOT]
2.	When I entered on my duties as manager I found that the paid up capital stock of the company was about $100,000, which was by


Alfred Henry Clarke: 1805 increased to $125,000, and I also found that the board of directors, in preparing their statements for the shareholders and policy-holders and dealing with the question of profits (so-called), had in the past, uniformly computed the interest on the paid up capital stock at the average rate of interest earned by the company on its investments during the preceding year and credited the same to the shareholders' account, and after deducting and so crediting such sum, had estimated the profits realized from policies both on the participation and on the nonparticipation scale in one amount and credited the shareholders' account with twenty-five per cent of such amount, and the policy-holders on the participation scale with the remaining seventy-five per cent, thus giving the policyholders on the participation scale a share in the profits of the entire business of the company, and thus crediting them with the profits in a class of profits to which they were not entitled.
3.	The same course of first crediting the shareholders' account with interest on capital at the average rate earned on the company's investments, was pursued during my whole tenure of office, and the amount of divisible profits was arrived at after crediting and setting apart such interest and included profits from policies on both the participation and non-participation scale. The shareholders' account from 1875 onwards was charged with a proportionate amount of the expenses of the company's investments.
Then there is a paragraph which my hon. friend from Halton read this morning, where he says that it was decided to apply to have it made clear in future that the directors might make an allotment of the profits from the entire business of the company, that is both from the participating and the non-participating policies, to make it absolutely clear what the meaning of the words 'entire business' was. Up to 1879 they were not authorized to give it from nonparticipating policies, he says, the intention was to give it from the entire business, that is both the participating and non-participating. He says that was the object and intention of the recital in the Act passed, 42 Vic., chap. 72, in the last paragraph of the certificate. He says:
After the passing of that Act, and during the whole of my connection with the company, the shareholders' account was, from time to time, regularly credited annually with the amount of average interest earned on the paid up capital stock, and it was after such amount was so credited and set apart, that a quinquennial allotment and division of profits was made within the limits of the proportions mentioned in that Act, and no question was ever raised or suggested as to such allotment and division being improper or unwarranted.
That is the statement of a man who is now pretty near the grave, and who has

been associated with this company for many years, and against whose character, business or otherwise, I have never heard a word of criticism. Surely it is rather farfetched for the hon. member for Halton to come out and attack Mr. McCarthy who was before the committee, and charge him with deceiving the committee when he said that the men of those days never intended that the words then used had the effect which it is now claimed they had. Mr. Bruce was there. We have the statement here of Mr. Ramsay. I have also the sworn statement of the actuary to the same effect, and there cannot be the slightest question that the meaning which was attributed in those days to the Act is the very meaning which we now claim it had. It has been said by an eminent judge that the best way to interpret a document or a will is by reference to what has beer done under it. He says in a certain case that came before him, ' Show me what the parties have done under the contract and I will tell you what the meaning of the contract is; in invoking that rule, surely we here have the strongest evidence of what the meaning is, because the directors, among the most reputable men in Canada, who have been associated with this company, came and asked for a certain Act, they explained what they believed they wanted, they acted upon it, and in this way, unless they are the most arrant scoundrels on the face of the earth, I submit that their interpretation is the only one that ought to be adopted at the present day. Surely after thirty years of experience the men who are insured in the Canada Life Assurance Company, many of whom are in this House, men occupying the highest positions in Canada in all walks of life, would have known something about it if a fraud were being perpetrated upon them such as is sipoken of at the present time. It has been said that they did not know what was being done. If they did not know what was being done it is very good evidence that they were not misled. If they were looking for profits from the investment of the capital stock when they entered into their insurance contracts then some one of the 35,000, or 40,000 policyholders and many more who have got their profits would certainly have discovered that they were not getting that which they had contracted to get.
There is one more thing that I want to discuss. It has been said that the company, by the paying up of the capital stock, have taken away profits to which the policyholders are entitled, and in support of that proposition they have invoked a paragraph in the report of the Royal Commission on Insurance relating to this company, which 'will be found on page 13:
But it is equally manifest that if the inherent earning power of the additional capital is only 4 -67 per cent, its engagement in the concerns of the Canada Life without any real need is a simple method of raising that earning power to 8 per cent, the difterence, under whatever name, being unnecessarily taken away from the policy-holders whose accumulations have earned it.
That does not say that the policy-holders have suffered any loss on account of the capital stock being paid up. What they do say is that the difference between the 4-67 per cent and 8 per cent is unnecessarily taken away from the policy-holders. Well, if the Canada Life Assurance Company, or any other company, is doing business for charitable purposes without any attempt to make any profits out of it, then probably it would not be fair to take any of the profits from the insurance business, but I say most emphatically that the payment up of the capital stock has not affected in any way the profits received or which may be received by the policy-holders. Let us look at the facts. Under the Act and under the contract the shareholders are entitled to 10 per ent of the profits from the insurance business, and the policy-holders are entitled to 90 per cent. It does not make a particle of difference what the capital stock is. Whatever the insurance business realizes for distribution, 90 per cent of it has to go to the policy-holders and 10 per cent to the stockholders. Whether or not the stockholders put $10,000 or $1,000,000 or $10,000,000 into the company they are not taking in interest upon the capital stock anything but the 10 per cent of profits which are earned. If they did not pay up the additional $875,000 of the capital stock there would be no earnings upon it. If they had paid in $875,000 they would have paid in not the shareholders' money, but their own money instead of putting it into a loan company or of loaning it at a certain late of interest. They pay up their capital; they invest it in an insurance company, and it is only the money which is realized from the investment of their own money which they pay to themselves as dividends. What difference would it make if they paid $100,000,nnn? That $100,000,000 earns $100,000; it makes no difference at all to the policy-holders. They are only taking the legitimate earnings of their own money. If they were taking from the policy-holders more than ten per cent of the money earned in the insurance business, they would be doing wrong, but it has not been suggested that anything of that kind is being done. So I submit that the evidence is overwhelming that the intention of parliament in 1879 and the intention of the company was to give that section the meaning which has been acted upon by the comnany and acquiesced in by the policy-holders for thirty years. We have never had a man

who has dared to get up and say that ho was misled. If any contract of insurance was obtained by the representation that they were paying interest on the capital stock as well as the profits, the man who entered into such a contract is not harmed, because he has his redress. If any one told him that which was false, which was a misrepresentation, he has the simplest kind of an action to have the contract set aside and get his money back if he wants to. But he does not want to get his money back. Many men went into this insurance company twenty, thirty or forty years ago. They are men who have become too old to get insurance in any other company. If you are going to paralyze this company, if you are going to say:	'You have to give
up an investement which to-day yields you 8 per cent and you can only have an investment which will yield you about 4 per cent,' the result will be that you will ruin this company. If you ruin the company who are the people who will suffer by it? Who are the people who are going to have no profit? They are the policy-holders who went into this company years ago, and who cannot get into any other company now. If the company are going to make any profits at all the policy-holders are going to get profits. It is to their interest as policy-holders to make this company as profitable as possible because, according to the prosperity of the company, will the profits be distributed.
It is quite true that during the last few years profits have been less than they had been hitherto, and it is sought to blame-that upon the payment up of the capital stock. Let me give the committee an illustration of a policy of my own for $2,000. The profits were applied in reduction of premium. In the division of 1895 I had a reduction of $16,60 a year in my premium. It must inevitably happen in this as well as every other company that as the company gets older, as the men who went into it when they were young begin to die, the profits cannot be so large. The rates of interest are going down and for these two reasons it cannot be expected that profits in the later years of the company's existence are going to be as great as they are in the earlier years.


Edward Arthur Lancaster: They ought to be if the actuaries are any good or know their business.


Alfred Henry Clarke: That brings up the question of the reserve.


Edward Arthur Lancaster: What I mean is that if the actuaries properly fix the rates there should not be any difference, because they should know that people will die.


Alfred Henry Clarke: I do not quarrel with that. If the actuaries do their duty Mr. A. H. CLARKE.
they will institute rates and keep up the reserve, so that- those in later years will pay the same as those in earlier years. That is precisely the condition which the directors were confronted with in 1889. It was not only a question which confronted this_ company, but one with which all companies had to deal. Parliament said to the companies:	' The rates of interest are
going down and you must maintain a greater reserve out of profits for your policy-holders than you have been keeping up.' In pursuance of that the Canada Life increased its reserve. If it were not for increasing this reserve the profits would have been greater because a very large sum which was carried to the reserve account had to be taken from the fund which otherwise would have been divided up in the shape of profits. If you keep that as a reserve you cannot pay it in profits. If it had not been for increasing the reserve of this company a large amount of profits would have been divided up and there would not have been the diminution in profits that there was. But, to say that the paying up of the capital stock had anything to do with the amount of profits is absolutely fallacious and I will illustrate that by my own policy. In 1895 the premium on my policy was reduced by $16.60. There was another distribution of profits in 1900. Up to 1900 the capital stock had not been paid up. At the quinquennial division in 1900 there was the largest reduction made in the history of the company. Why was that? . Not because their capital stock was paid up, because it was not paid up until after that time, and yet in the distribution of profits in 1900, instead of having a reduction for the five years of $16.50' there was a reduction of $8.40. It was after that that the capital stock was paid up; but notwithstanding the paying up of the capital stock my profits were increased, because in the distribution of 1904, instead of having profits of $8.40 the profits were increased to $10.30. The reserve now has been made up and that has been my argument and I appeal to those who have any consideration at all for the policy-holders of this company, and now that the company has its reserve made up it is in a position such as it has not been in since 1899. They do not now have to carry anything to make up the reserve to the requirement of the Act of parliament and hereafter all these profits will be carried to policy-holders' account or to the account for the distribution of profits. This is the last year in which the policyholders receive any share of the profits of the five years last past. If we are to get any profits from the last five years we will get them from an allotment made by the directors. The directors are not bound to

make any allotment of profits. If they do not I will have to pay on my small policy $10.30 a year more than I have been paying for the past five years, and when my hon. friends talk about the widows and orphans I wish they would remember that it is the widows and orphans who are to participate in these profits. If these profits are held up, if the directors are not in a position to divide them, it is the widows and orphans who will suffer. It seems to me that the whole matter is so eminently in the interests of the oolicy-holders that this Bill ought to go through without opposition. It would be an outrage upon the company to cut the profits down from 8 per cent to 4 per cent and to put a construction on the Act which neither the directors nor any one else ever contemplated. It is a strange sense of iustice that would impel people to take that view of this matter.


Cyrias Roy: Have any of the policy-holders requested the passage of this resolution?


Alfred Henry Clarke: Yes. My information is that the policy-holders' representative on the board, Mr. Chaput, of Mont real, amongst others, have requested this legislation at a meeting between themselves and the shareholders of the company.


David Henderson: The hon. gentleman read a list of policy-holders' directors. How many of these are shareholders, or arc they all shareholders?


Alfred Henry Clarke: I do not know.


David Henderson: I fancy he will find they are all or nearly all shareholders.


Alfred Henry Clarke: I do not know about that. I know they are the gentlemen whom the policy-holders have chosen to represent them.


Haughton Lennox: That would take away all the force of the hon. gentleman's argument in regard to them. As shareholders they would be interested in the affirmative of this legislation and could not be said to fairly represent the shareholders.


Alfred Henry Clarke: Men of the character of these men appointed to represent the policy-holders would be betraying their trust if they did not do everything which they thought in the interests of the policyholders.


Edward Arthur Lancaster: I do not agree in that, because we all know that individual policy-holders cannot watch everything that is done by the directors. The shareholder directors become associated with the other directors and officials and become deferential to them in regard to what they have
been doing; they get into the way of continuing from year to year certain things which they -might not do if they had to account to their policy-holders. These directors do not account to the policy-holders as such, they only have to go to those meetings and take a part in the allotment of profits. The moment they become shareholders their interest is against the policyholders, in so far as the subject of this Bill is concerned.


Mr. TALBOT.: By whom are they elected?


Edward Arthur Lancaster: By some of the policyholders, not by all, because very few get a chance to ballot. I have been a policyholder for a great many years and have never been asked to vote, have only once received a paper or anything else giving me a right to vote as a policy-holder. I do not say this was done purposely, but I contend there is nothing in the fact that certain people on that board, who are themselves shareholders, are supposed to represent policy-holders more than any one else. If my hon. friend asked a court for a construction of this statute, his arguments would not hold good. All he has said is the best reason why parliament should not interfere. He has argued why a certain construction should be put on the statute of 1879 but he is not content to rely on the virtue of that statute because he asks parliament to prevent a court from construing that Act.
How are we to get away from the precedent we establish if we pass this Bill? This precedent will be used to interfere with established rights in this country and with wrongsi which may occur by reason of the condition of the law. We are asked to say that parliament in 1879 did not mean what it said by its legislation. If we are not asked to do that, we are not asked to do anything. A certain construction would be put upon these words in the Bill of 1879. That is the construction the courts would place upon it, and the moment we interfere with that and pass an Act to say what was intended to be meant we change the rights of the people under that statute. If a very strong and meritorious case were made out it would be bad enough but I believe that even then it would be wrong technically for us to pass such an Act as this. If both parties were before us and they agreed that there had been a mistake, there might be some justification for this legislation, but we are asked here to assume that the Senate and House of Commons of Canada in 1879 passed an Act which was not intended to mean what it says and apparently it does mean. I ask in all fairness of the Prime Minister and every other hon. member whether

there is a particle of evidence in support of such an assumption. There will be endless difficulty if we introduce the principle of not accepting legislation as meaning what it says. We must not seek to place the responsibility for legislation on the draughtsman who prepared it, on the typewriter who wrote it, or on the printer who printed it, the responsibility must rest on the legislative bodies which passed it. It does not make any difference what any body outside the walls of this chamber thinks in regard to an Act passed by this parliament. It does make all the difference in the world what the members of this House or the members of the Senate who passed that Act undertook to say when they passed it. If you say the Bill is to rectify a mistake, you have to say it was the mistake of the legislators themselves not the people asking for the legislation, which would be absurd. A motion might be passed in this House that was right to be passed because the right hon. the Prime Minister might see no harm in it, and let it pass. Does that entitle any one to say that any motion that he presented should be accepted because he asks for it? If that were so there would be no functions for parliament, nothing for parliament to act on, no need of us asembling. So we must say that the legislation passed in 1879 was what was intended to be passed, unless we have evidence that the legislature of that day made a mistake. If any hon. gentleman said that he was present and was one of those who took part in the discussion of that Bill, and showed that something was intended which was not expressed in the Act, we would have some-thng to go upon. But we have here only the statements of those who asked for the legislation and who supported it in their own interest, asking that their action be contra dieted, so there is no reason why we should vote that parliament made a mistake in 1879. The Bill does not allege that as a reason for passing it, which makes it all the more vicious. It simply says boldly that certain language in the Act of 1879 was intended to mean so and so, without any reason being given why it is to be so declared. If we pass this Bill to-day, on the understanding that those who sought for the legislation made a mistake in asking for what they got, we do not save parliament from the consequences of a most dangerous precedent. We do not give any reasons for changing the legislation. We simply say that certain words in a certain Act of parliament passed in 1879, are not only intended to denote so and so, but do denote so and so, and have been denoting it for thirty years. If we were going to say that hereafter the arrangements the Canada Life makes in regard to its profits shall Mr. LANCASTER.
be so and so, and qualify the words of the Act of 1879 for future use, that would be bad enough; but it will be certainly vicious, besides most unfortunate for the credit of parliament, if we enact retroactive legislation which declares that not only shall these words for the future be held to mean so and so, but they will be held to mean the same ever since the Act was passed. If investors in Canadian enterprises once get it into their heads that legislation under which they have acquired rights may be set aside, and retroactively treated, by the influence of somebody upon the government of some future day, it will be a sorry day for this country. Just contemplate it for a moment. Some people may come to parliament and get an Act passed, induce people to invest money on the faith of that Act, and afterwards, if they have influence enough with the government in power, get it changed. People who are invited to invest their money under the authority of our Acts of Parliament will be afraid to do so. If this sort of thing is going to be begun now, it will be expected to be continued hereafter; and we shall have that deplorable condition, that the man who does not want to use political influence, but wants to stand on his merits as an ordinary citizen, will not have any faith in parliament's acting to give him an Act which will protect his rights. But the man who is willing, and who with his associates may be able, to use influence enough with the government that may control parliament for the time being, will be able to get legislation which is deceptive to the country. It will be a most serious blow to good faith in Canada's legislation. It will be more than that. To say that certain words used in a former Act of parliament were and are intended to denote something different from what they do denote in the ordinary meaning of the words, and to say that an Act shall be passed so declaring them, because those who sought that legislation are unanimous in saying that they wanted to get something else, is practically an insult to the intelligence of parliament, especially to the intelligence of the parliament that sat in 1879, because it is equivalent to saying that those who sought that legislation could get anything they asked for. We must suppose that parliament knew the words it was using and used the right language. If the language is so certain to be construed as it is interpreted by the hon. gentleman who promotes this Bill, then he does not need this legislation, and the moment he comes and asks for it, proclaiming that he is certain that the language will be construed in that way in the courts, it makes any body who applies his knowledge of human nature to this Bill believe that those who are interested in this legisla-

tion and who are asking for it, do not believe that the courts would so construe the language. If there is so much certainty that the language will be there held to mean what it is so strongly contended it does mean, that is the best reason for not passing this legislation. If they are wrong in that they still should not have the legislation, because it is establishing a precedent that will strike at the very root of respect for parliament and government in this country. I want as strongly as I can to put on record my views, and what I believe are the views of my constituents, on this matter. I must resent the statement made by the hon. gentleman who is promoting this Bill, that Mr. Cox, I suppose he means Senator Cox, is made the target of the opposition to the Bill.
That is very unfair. It should not have been said and was not justified. It is not the Hon. Senator Cox who is the target,
[DOT] but the people of this country, and Senator Cox is the man who is attacking them. The people have not come here for any legislation; the policy-holders are content to be governed by the statute of 1879, and I resent the insinuation of the hon. gentleman as utterly unfounded. Why do not the promoters of this Bill go before the courts and have the courts decide what this statute really means instead of coming before this parliament? I appreciate the force of the hon. gentleman's remarks that a judge will often take the practice which has been followed under a contract, and construe the contract according to that practice when there is doubt. But I would not go so far as to say that such practice is the primary ground on which a document is construed. That is a course taken only m the last resort. But what I submit is that the matter before us involves property and civil rights and consequently is one in which we have no right to interfere. I want to impress upon the Prime Minister as strongly as I can that this Bill is a serious attack on a fundamental principle, and is calculated to shake the confidence of the people in the parliament of this country. If men come to parliament for legislation which affects other people as well as themselves, and if, in the legislation which they ask parliament to pass, they are unfortunate enough to use language which does not accurately convey the meaning they intended, and if that legislation be adopted, then they must pay the penalty. But if you are going to alter a statute afterwards in the interests of one of the parties concerned, and against the interests of others, you will be committing a great injustice and shake the confidence of our people in parliamen-ary government. My hon. friend speaks of the rights of those people who have invested their paltry $200,000 or whatever it is in this company. And when I use the
word paltry I do so because the amount is of no importance whatever compared with the rights of the mass of the people. The hon. gentleman talks of the $200,000 invested by certain capitalists in the stock of this company. But what is that compared with the amount invested by the policy-holders or with the millions which we expect to be invested in this country, and which are now being invested, in other enterprises? How can we expect people to have any confidence in their investments in this country if at any moment an Act of parliament is liable to be amended which will completely change the conditions under which these investments were made, and especially when such changes are made at the instances of men who have sufficient influence with the government to have the government force through the legislation they desire? iSuppose some ordinary citizen, some poor farmer or merchant or labouring man, or even professional man, had a contract with the Canada Life governed by a certain statute, which is interpreted differently by the company from his understanding of it, does any one believe that he would dare come here and ask for an Act of parliament to change that statute so as to make it beyond doubt suit his interpretation of it? If he did, he would not be listened to. The position is a serious one. It will cause the people to come to the conclusion that the more money a man has, the more influence he can wield and the more rights he has in parliament, and that is the worst belief with which you can innoculate the people of any country. If you want the people to be contented, you should impress them with the conviction that every contract, whether made by rich or poor, shall be held sacred and that this parliament will not interfere with the courts in construing that contract and enforcing it.
We have this session a general Bill before parliament respecting the whole insurance business. That is a Bill in which all classes are interested. When you pass such legislation, are you going in a year or five years later, at the instance of interested parties, to say that certain sections of it do not mean what these parties say it does not, or what the courts might hold it to mean, and have that law amended so as to suit people who have sufficient influence with the government to have their views prevail? How are you going to give any stability to your legislation unless you hold everybody by it once it is adopted, saving those very exceptional instances in which a mistake apparent to everybody is made? In this instance, wc have not a particle of evidence that a mistake was made. We cannot say that the Act which was passed in 1879 would have been passed differently had the contention been raised then which is submitted now. For these reasons I am decidely opposed to this Bill.


Mr. TURRIFF.: It is not my intention to speak at any length, and I have not the slightest idea of obstructing the Bill. The House has decided to force the Bill through this session without giving the policy-holders an opportunity of appearing before the committee, and the House must assume the responsibility. But in view of the fact that the policy-holders are not to be allowed to come before the committee to present their views, it had been my intention to take up the best part of an hour in placing some of my views before the House. However, as the hour is so late, I shall forego saying the greater part of what I had intended to. I find myself in the very unpleasant position of working and debating against all my friends with whom I have worked for years. But I feel keenly on this subject. I feel that this Bill is a rank injustice to the policy-holders, that it is corporation legislation as against the people; and I want to say that when it comes to a question of a corporation against the people, I want to be found- at all events when I know it-standing up for the rights of the people. I have been told by a number of hon. members on this side that this is not the place in which to deal with matters of this kind, and that the proper place is the annual meeting of the Canada Life Company. But you know, Sir, as well as I, that that would be simply an idle farce. There are nine shareholders who are directors in this company, and they are all controlled by one man who owns over 50 per cent of the stock. If he owned the full amount he could not control the company, in selecting the personnel of the directors, any more than he does at present. It has been said by my hon. friend the promoter of the Bill that there are six policy-holders' directors. But how are they elected? Any of us who have had anything to do with the company work know that a lot of directors who own one-fifth of the stock of a company, if that stock is at all widelv scattered, can at any time control the company by getting proxies. So, these shareholders' directors get the proxies at the same time from policyholders all over the country and by casting their votes unanimously they can elect whomsoever they please. So, I say, it would be absurd for any policy-holder to get up at an annual meeting and expect any consideration for the proposal not along the line of what was desired by those in control of the company.
There is one phase of this question that I wish to nut before you and before the legal gentlemen of this House. If this Act is passed, you are taking away the legal rights of some 30,000 or 40,000 Canadian shareholders. But there are many other policy-holders outside of Canada.


Edward Arthur Lancaster: There are British policy-holders and American policy-holders, and this parliament cannot interfere or do away with the rights of these. What position will the Canadian policy-holders be in? They will be charged a high rate for their insurance and the American and British policy-holders will be charged lower rates. This is a very serious matter. The Caandian policy-holders who will build up the company, they put up the $33,000,000 invested at the present time; it is not the shareholders or the directors who did all this, but it was you and I and everybody else who took out a policy, and for years we have been paying premiums not only to carry our insurance but to give us a profit and our accumulations make up all these millions that are invested. Is it fair that the Canadian policy-holders, who built up the company and own nine-tenths of it, should be taxed at one rate and the American or British policy-holders be given their insurance at a lower rate? There has not been very much said about the merits of this Bill. The whole trouble is that there is an uneasy feeling throughout the whole country that the policy-holders are not being fairly treated by the present management.


Edward Walter Nesbitt: May I ask, is the company charging the American or British policy-holders less than it is charging the Canadian policy-holders?


John Gillanders Turriff: No, not at the present, time; but if this Bill passes, not Canadian policy-holder can take action to have returned what has been deducted from his policy, while the American policy-holder can do so.


Some hon. MEMBERS: No, no.


John Gillanders Turriff: I took legal advice on the matter, and I was informed that though this company is in Canada, when it issues policies in another country it must comply with the laws of that country. That has been decided in courts time and again. So, I say, there will be this difference in the position of the Canadian and American policy-holder. There is one very peculiar thing about it, and that is that, during the last fifteen years or so, as the profits of the policy-holders have gone down, the profits of the shareholders have gone up.


Edward Arthur Lancaster: And the salaries of the big men.


John Gillanders Turriff: Yes, and the salaries of the big men. That is one of the fears that exist in the minds of the policy-holders. As the Royal Commission said in its report, there is nothing to prevent this company increasing its dividends. And further-(in-this I am not quoting the report)-there is nothing to prevent them, when they get

this legislation, and have everything fixed up properly, fixing their salaries at double what they are now. There are four men, the president of the company, two of his relatives and the past manager, drawing $60,000 a year, only two of them working actually in the company. That $60,000 is almost fifty per cent annual dividend on the original $125,000 paid up capital of the company, and it is six per cent on the paid up capital of $1,000,000 to-day. What is there to hinder them from making these salaries $100,000 and taking ten or twelve per cent before they make the division? It is this fear which is abroad in the land that is making the policy-holders apprehensive for the future.


Mr. MILLER.: May I ask the hon. member (Mr. Turriff) whether this Bill in any way affects the matter of salaries?


John Gillanders Turriff: No, it does not affect the matter of salaries. But this is the one chance that is given to the policyholders to say to the company: 'You ought to be able to do so and so.' And. if the Bill is so good, and if all we are told by the promoter of the Bill-and I have great respect for that hon. gentleman's opinion and standing, and would like to believe what he has said-is correct, the company has nothirg to fear in waiting another six months for this legislation. This is_ not the year when the profits are to be divided.


Edward Walter Nesbitt: Is the hon. member (Mr. Turriff) sure about those salaries? I do not think he intends to misrepresent from whalj I know of him, but is he sure that four men draw $60,000?


John Gillanders Turriff: The hon. member can find it in the report of the Royal Commission. I have a copy here, and I will send it over to him.


Edward Walter Nesbitt: I would not believe it if I saw it there, because I do not believe it is true.	i "If


John Gillanders Turriff: My hon. friend (Mr. Nesbitt) may be haggling over a technicality. One gentleman draws about $20,000 in commissions,-I was calling it all salaries.	! i! I.


Edward Walter Nesbitt: He earns it.


John Gillanders Turriff: I am not saying he does not. But the policy-holders have a fear that, in one way and another, their profits are still going to some others and not to them. But I would have you understand, Mr. Chairman, that there is a widespread fear in that respect. I have a letter here written by a gentleman who gave me liberty to use it. I have several other letters the writers of which do not give me that permission, so I will not even 192
refer to them further. But here is a letter written prior to the discussion of a week ago. It is addressed to Mr. John Hoskin, vice-president of the Canada Life Assurance Company:
Perth, Out., April 30, 1909. Dear Sir,-Replying to your inclosure of the 3flth inst. in re proposed amendments embodied under 'Bill 56' at present session of parliament, I must confess my surprise that a gentleman of your standing and reputation should endorse and support the action contemplated by the management of the Canada Life as proposed by this Bill.
I have been aware of the malignant influence manifest in the affairs of the Canada Life ever since the inception of the present management and the recklessness with which the funds of the company have been squandered. I can challenge you to assert honestly, or to particularize, any act of import affecting the funds of the company during that period which has not been to the substantial loss and detriment of the policyholders, or otherwise than to the aggrandizement and pecuniary advantage of the Hon. G. A. Cox, some member of his family, or the shareholders of the company, per se in conflict with the reasonable expectations and rights of the policy-holders.
I do not know whether it is of malice prepense with a view to the ruin of the company, as your management has in this part of the country ruined the enviable reputation the company formerly held. I can well recall the period when the Canada Life was a name to conjure with in securing the patronage of the insuring public, and the policy-holders constituted the best agents at the service of the company. Personally no one will invest a dollar in the company whom I can influence, until the company warrants a return of my confidence by a complete reversal of its present policy, of which the scope of the Bill now before parliament affords very small encouragement.
I am enlightened for the first time as to the fact, of which no reports I ever received advised the policy-holders, that the shareholders primarily appropriated the interest -earning power of the assets of the company upon their paid-up stock, a sauce piquante to whet their appetite for voting a 25 per cent dividend. Their honesty was most exemplary under $100,000 paid-up capital, in comparison with the present proposition under an augmented capital of $1,000,000, a totally uncalled for increase, except to satisfy the greed of shareholders in a larger exploitation of the funds for their benefit. ' And they are all honourable men.' I could go into details to show how consistent the policy of the present management has been, to enrich themselves at the expense of those whose trust has been shamelessly betrayed. But you know it as well as I do; if you plead ignorance I shall be happy to afford you a partial insight, as I believe I may unfortunately be incompletely informed.
However, assuming your communication is for the enlightenment of the policy-holders, you will doubtless be pleased to advise me.
1. As to the purport or advantage accruing to the company in assigning the annual meet-



F. MASON.

[Stage Direction]
Then, in the letter inclosing that to me, he says:
Dear Sir,-Thanking you for the stand you have taken in re ' Canada Life Bill' in op-san)®>
I am persuaded three-fourths °* In® Canadian policy-holders will appreciate the efforts of the members opposed to it, and would show a united front in a strenuous opposition to it, if the Bill could be laid over for another session.
I beg to inclose you a protest mailed to Jno. Hoskm, Esq., vice-president of the Canada Life, which has received the endorsation of every policy-holder here to whom it has been submitted. If desirable you are at liberty to make use of the same.
I remain, yours truly,

[Stage Direction]
Now, Mr. Chairman, that gives you an idea of the feeling throughout the country.
I believe myself that the policy-holders have not been getting a proper share of the profits. I have in my hand a policy that belongs to my father-in-law, which was taken out in the year 1860. He is 86 years of -age to-day. For 50 years-the policy is now in existence 50 years-he has been paying regularly his annual payments;
I have been looking after it for him now for a number of years. His annual premium is $28.50, and 30 or 40 years ago that policy, when the company had practically no accumulation of profits, earned $25 or $26 a year. But ever since the present management came in the profits of that Mr. TURRIFF.
policy have gone down, down, until during the last 15 years, it has earned $8 to $10 a year, never more than $10 a year in the last 15 years. I had a long talk the othgr day with the president of the company, who wanted to satisfy me that everything was right. I am anxious to be satisfied that everything is right. Tn order to do that, he sent to Toronto and got a statement of that policy and handed it to me in order to convince me. Well, it has confirmed my opinion more strongly than ever that that policy has not been getting all the profits that belong to it, and I will tell you why. But let me first read this telegram:
Toronto, Ont., April 24, 1909. Hon. G. A. Cox,
The Senate, Ottawa.
Policy number thirty-one ninety, Wilson, age thirty-eight, one thousand dollars issued April, eighteen sixty. Premium twenty-eight fifty, bonus addition end nineteen hundred four, eight hundred forty-nine cash value same seven hundred forty-eight. Permanent reduction same two hundred eleven sixty-four. Applicable this year's premium. Total cash value policy fourteen hundred seventy-nine.
That is to say, Mr. Chairman, that on this policy which I now hold in my hand, Mr. Wilson can go up to Toronto, and draw out on the profits of that policy $748. That $748 is cash lying there that he can draw out to-morrow; it has earned, ac cording to the statement of the company during the last year, $35.15. Ten per cent of that, which belongs to the shareholders of the company, is $3.51, leaving a balance that belongs to Mr. Wilson lying there in the Canada Life Company's hands, over and above the ten per cent to the company, of $31.64. In addition to that you must add what the original policy of $1,000 earns each year. Now that is what it i-s earning, and for 15 years back he has not got over $10 in any one year. That is what makes the policy-holders think something is not right. I am not going to say that everything is not right simply because I do not know. But if the company would leave this Bill over for six months, and if my hon. friend the member for Essex could have the Bill passed through next session in time to make the distribution, because under the quinquennial term it is not due until the end of this year, nothing would be lost. If that were done it would satisfy me, and it would satisfy hundreds and thousands of other policy-holders, and it would do the company, even if there was some reduction, less than one-tenth part of the harm that will be done by the action this House is taking to-day in shutting out the policy-holders from having any voice or right to come before the committee and

before parliament and present their view of the case. As I stated on a former occasion, when you find hundreds and thousands of men thinking they have a grievance, thinking that a wrong has been done them, even if they are altogether mistaken in the matter, if you do not give them an opportunity to satisfy themselves and have the matter explained to them, those men for all time to come will believe that a wrong has been done them, and the company will suffer. There are a good many other things I had intended to mention, but the hour is getting late, and I know it is the wish of the committee to get through with this measure before six o'clock. In deference therefore to the wishes of my hon. friends I will take up no more time. I will only say again, and place my remarks on record, that in justice to the 40,000 policy-holders, in justice to their wives and children, the Bill should stand over, and you should give these policyholders an opportunity to come before this House, or before one of the committees of this House, and present their views of the case.
Mr. S. SHARPE.: It is not my intention at this late hour to discuss the question at any length. I think the position of the policy-holders has been put before this House so well by the hon. member for Halton (Mr. Henderson); the hon. member for North Toronto (Mr. Foster), and the hon. member for Lincoln (Mr. Lancaster) as to leave little more to be said. I am sorry as a member of this House that the hon. member for South Essex (Mr. Clarke), speaking upon the merits of the Bill, did not attempt to reconcile the position he has taken to-day with the position he took in connection with the Cobalt Lake legislation. The substance of the complaint against Cobalt Lake legislation was that it was shutting the doors of the courts to people who believed that they had a grievance and that it was interfering with the inalienable right of every subject to have his grievance re dressed by the courts. The substance of the complaint made against this legislation is exactly the same. In essence this is exactly the same kind of legislation. It shuts the doors of the courts to policyholders who desire to have their rights construed by a competent tribunal. No speech made by any hon. gentleman of this House upon the Cobalt Lake legislation could be used to better advantage in the discussion of this question because it deals with the question of shutting the doors of the courts to the policy-holders.
i92i	1 111 CL*!


Alfred Henry Clarke: What is my hon. friends' opinion of the Cobalt Lake legislation?


Samuel Simpson Sharpe: That is not under discussion at the present time and I do not intend to express any opinion upon it. I desire to refer to the expressions of opinion that were given upon it by the hon. member for South Essex. That hon. gentleman said:
It may he good policy from a financial standpoint to take away the property of people in order to increase the revenues of the province; it is all very well for most people to look on complacently and see the government confiscate the property of certain individuals in order that they may share in the spoils, hut it is not much fun for the people whose property is thus taken away. It is not my intention to go into the merits of the case pro or con. What I say is that this company has been deprived by an Act of the legislature of Ontario, not only of what they say is their property, hut of their privilege which any citizen has to go into the courts and establish their right to that property.
If that language were used in reference to this legisation I think it would be most apropos, because, in substance and in essence, this legislation contains exactly what the hon. gentleman condemned in the Cobalt Lake legislation. We have the opinion of the Minister of Justice, who, in connection with the Cobalt Lake legislation, used these words:
It simply means, in my judgment, speaking as a voter of the province of Ontario, that our present provincial government, that our recent provincial legislature, have arrogated to themselves the right to say to any citizen of the province: 'You shall not litigate; it makes no difference how just you think your claim, we have the right to decide it and to deny you the open door of the courts; we have the right in this particular instance and we choose to exercise it.'
In my opinion the language employed by the Minister of Justice and the language employed by the hon. member for South Essex upon introducing the question of disallowance of the Cobalt Lake legislation is the strongest condemnation that we could possibly have of the present legislation. The Minister of Justice, discussing the question construed, as a qualified legal gentleman, the Act of 1879 in favour of the policy-holders, but he said that if a mistake had occurred it was the duty of parliament to rectify it, adding that it was a question of fact to be decided as any other question of fact, and that that question of fact had been decided by the Banking and Commerce Committee. I contend, Mr. Chairman, that the Banking and Com-

merce Committee was the worst tribunal before which such a question of fact, involving important rights and large interests, could be dealt with. What are the facts ? There was not a particle of evidence brought before the Banking and Commerce Committee. If they had wanted to decide judicially a question of fact of a very important nature and involving so many millions of dollars, it was their duty to have moved to refer it to a special committee with power to call evidence, to put witnesses on oath and allow them to be examined and cross-examined. The only evidence that was submitted before the Banking and Commerce Committee was the evidence of the Hon. G. A. Cox, who is the chief beneficiary of this legislation, and his counsel. That was the only evidence upon which the Banking and Commerce Committee found that there had been a mistake in the legislation of 1879. None of the directors at the time were called. The minutes of the directors' meeting authorizing the promoters to seek that legislation in 1879 were not produced. Surely the Banking and Commerce Committee did not have proper evidence upon which to find as a question of fact that there had been a mistake made in the legislation of 1879. I submit that this legislation does for the policy-holders of the Canada Life Assurance Company that which the hon. member for South Essex declared had been done by the Ontario legislature with reference to the Florence Mining Company, that is that it deprives them of their right to go to the courts. The question that this parliament should decide, according to the contention of the Minister of Justice, is, was there a manifest error in the legislation of 1879? A person reading that Act of 1879 can come to no other conclusion than that the language is so simple that there can be no possible question of an error. The language was the language of the promoters of the Bill. The Bill was drafted by the legal representatives of the company and it was adopted by the company. There were no changes 'made in the Bill before the committee and I submit that there has been no proper judicial determination of the fact that there was an error in the legislation of 1879. I venture to express the opinion that if the paid-up capital had remained at $125,000, as it originally was, this legislation would not have been sought for because 10 per cent on the _ entire profits of the company with a capital of $125,000 would have been a very large profit, whereas 10 per cent on $1,000,000 would be a measurably smaller profit. The promoters of the Bill should have adopted the suggestion made by the hon. Minister of Finance (Mr. Fielding), namely, that if they had paid up the balance of the $1,000,000, or, $875,000 under a mis-Mr. S. SHABPE.
take as to the facts, they were entitled to be repaid. That was a reasonable suggestion. If they paid up the balance of their stock under a mistake as to the facts or as to their rights it would have been proper for them to come and get legislation enabling them to reclaim their $875,000. The policy-holders had nothing to do with the Act of 1879 and if there was a mistake made it was the mistake of the shareholders and not of the policy-holders. If it had been a mutual mistake the position might have been different, but the alleged mistake was on one side only and the shareholders have now no right to come to parliament and ask to have it rectified. But, in addition, there is a far more serious question. Thousands of policyholders have obtained contracts and acquired vested interests in connection with their policies since the date of that mistake. What is to become of them ? Is parliament to violate the (vested interests of subsequent policy-holders, those who have come in since the alleged mistake took place? The question whether there was a mistake has never been judicially decided. The whole matter should be referred to a judge or to a' committee with judicial powers authorized to call witnesses, to put them on oath and to allow them to be examined and cross-examined and upon the report of that committee this parliament should act. The question that might be submitted to such a tribunal would be these: 'Was there a mistake and, if there was a mistake, what rights have since intervened?'
Now I desire to discuss the chief argument of the promoters of this legislation. They say that by this legislation the policyholders get ninety per cent of the profits on the money paid for stock. I do not think that is any injustice at all. That is a part of the charter of the company, that is a term, a condition upon which they do business and which they hold up as a special attraction to prospective policy-holders They get business on the strength of the fact that ninety per cent of the entire profits go to the policy-holders. Another argument was that the profits have always been distributed as provided by this Bill. I have a letter in my possession from a man interested in this legislation and he says that the profits have not always been distributed as provided for in this Bill. However, I contend that practice does not make legal any illegal distribution of profits. We have the instance of the New York Gas Company. The New York Gas Company for years had interprets ed their statute under which they were doing business wrongly and they had charged an excessive rate for gas to the gas users of New York city. Years after the gas users discovered what their rights were and sued for recovery for the price of gas which

they had paid in excess of what they were entitled to pay and judgment was given against the company. Consequently I do not think that it can be contended reasonably that the policy-holders slept upon their rights and agreed to this illegal distribution of profits. The books of the company are not open to the policy-holder, he does not know what his rights are, and he is not likely to go to the Act of incorporation of the company to find out exactly the liabilities of the company or his rights. Consequently the argument that the policyholders have slept upon their Tights should not prevail with this House. Another question was that lawsuits would entail the icompany in disaster. I submit that this parliament has nothing to do with the results to the company of the legislation of 1879. The business of this parliament is not to interpret, but to make laws. Inasmuch as there is -no precedent for this kind of legislation and it is dangerous class legislation, I venture to express the opinion that if any other person or company than the Hon. Geo. A. Cox came to this parliament asking a special Act of this kind, divesting policy-holders of hundreds of thousands of dollars of rights this parliament would refuse to grant such legislation.
The hon. member for Assiniboia (Mr. Turriff) also emphasized the important matter of differentiating the position of the Canadian policy-holders from that of the foreign policy-holders. If the foreign policy-holders' contracts are made in a foreign jurisdiction they will be governed by the law of that foreign jurisdiction and any legislation passed by this parliament will not affect the foreign policy-holders. But even if the contract were to be construed according to Canadian law, and even if this legislation did affect the foreign policy-holders, I say that there is danger of legislation of this kind leading to international complications. The United States policy-holders will not allow their vested interests to be taken away by this parliament without va strong protest to their government and that government may protest against this government passing legislation that would injure the vested rights of citizens of the United States.
I desire to quote a sentence from a letter I received from a policy-holder who says:
In these reports to policy-holders no mention is made of a double dividend to shareholders. Will parliament, elected to protect the people of Canada, set its sanction on this gross diversion of funds from the pockets of the insured to the coffers of the few rich shareholders ? When are citizens to believe in statements of public men and in the rights of private contract if parliament step in at the instigation of a rich corporation and annul agreements made in good faith under the law of the land at a time when the wrongrespectfully urge all interested in honest administration to reject the proposed amendments to the Canada Life charter.
Having made my protest I shall not delay the House longer. I gave notice of an amendment to strike out clause 2 in committee and I now beg to move that amendment.
Amendment negatived.
Section as amended agreed to.


Mr. DEPUTY SPEAKER.: Shall I report the Bill?


Haughton Lennox: Did the Prime Minister obtain the opinion of the Minister of Justice upon this question, and if he did would he either lay the communication on the table of the House or give the committee its purport?


Wilfrid Laurier: The government has had no other opinion from the Minister of Justice than the opinion which he expressed some time ago in this House.


Haughton Lennox: Had the Prime Minister a written communication from the Minister of Justice on the question?


Wilfrid Laurier: No, I did not.
Bill reported, read the third time, on division and passed.
On motion of Sir Wilfrid Laurier, House adjourned at 5.40 p.m.

Monday, May 10, 1909.